Business ethics and its impact on SCA

Published Date: 23 Mar 2015

The article uses a case study analysis of Amazon.com's strategy to develop an understanding of the e-commerce competitive environment and the importance of building a sustainable competitive environment to create value for the firm, its customers, and its shareholders. Business ethics are becoming more and more topical and important. Ethics are very important to all business people. Yet, many neglect ethics as an important concept that has a major impact upon a person's success as an entrepreneur and investor. In this paper we aimed to provide some evidences to support the idea that being ethical, transparency, and morality can make a firm much different from competitors. This paper is trying to present a model for relationships between ethics and SCA and connect it to amazon.com situation to show how this web site cares about ethics and transparency to keep customers satisfied. We applied interview as a qualitative method to gather data from consumers. We conclude that the need for ethics in any kind of business like amazon.com has never been greater, precisely because the power of business was never so manifold and as extensive as it is today. In a global business environment, responsible marketers discover what consumers want and respond with marketing offers that create value for buyers in order to capture value in return. Some marketing companies use questionable practices and some marketing actions that seem innocent in them but strongly affect the larger society.

Introduction

Amazon.com began by selling books directly to customers over the Internet and by passing the traditional industry channels. Customers who valued the time saved by shopping from home rather than driving to physical retail outlets flocked to Amazon.com¿½s Web site to buy books. Industry competitors Barnes and Noble and Borders Books were forced to develop their own Web sites, thus driving up their cost of doing business.

According to Efuture center (2008) some types of goods are ideal for selling over the Internet; others are less suitable. For example, Amazon.com aims to make book buying fast and easy. Most people buy books based on the information contained on the jacket, or after reading a book review. Or, they may simply like the previous work of the author. Because all of this information can be displayed effectively on an e-business site, selling books over the web works well.

To survive, it is critical that online retailers create a sustainable competitive advantage in their e-commerce strategy and plan for long-term strategic positioning. Ethical issues are becoming very important in today¿½s competitive market. Transparency and ¿½honesty is the best policy¿½ still have their prominent roles not only in daily lives, but also in business. All people care about ethics in their business. Still there are many ignored ethics that have a major impact on a person¿½s success whether an entrepreneur or an investor. Here we are talking about business which is, in fact, dealing with money, either one¿½s own or borrowed. It also involves building successful money based relationships with clients and customers. Such relationships must be built on trust - and having ethical foundations are imperative to the building of trust. Therefore ethics constitute the core factor in a business.

An employee bribing somebody, even to further his employer's interests, is likely to be dismissed. Many multinationals refuse to conduct business in countries where bribes are commonly given and taken. These are examples of the applied side of ethics in business. In respect to the subject, we know that industries and some of the companies globalize because of changes in technology, innovation, customer needs, government policy, or country infrastructure make main differences in competition position among firms from different nations. These differences can give a competitive advantage to the company over its competitors. As porter (1998) point out that firms are engaged in an international competition. So they must compete in a global arena. Sustainable competitive advantage has proved elusive for companies in the 1990s. While making enormous investments in technology, research and state¿½of¿½the art marketing, Pfeiffer (1994) argue that most of the today¿½ managers have forgotten the single most important factor in achieving and maintaining competitive advantage: People.

In respect to ethical perspective we have seen sometimes philanthropic activities which have, in many cases, not been connected to the day-to-day business activity. As we mentioned earlier in the current international climate of interest in social issues, which can bridges business and wider societal concerns, most of the firms are trying to embed CSR in their activities. The underlying proposition of using term ethic in business is that the responsibility of a business is not just to focus on maximizing shareholder return.

Literature review

First of all we should say that businessmen need to consider ethical issues in their daily activities. As Mahoney mentioned (1997) the need for morality and ethics in business has never been greater and precisely because the power of business has never been as extensive as it is today. Ethics has been used very much referring mostly to the rules and empirical aspects of right and wrong operation. Aldag and Steams (1991) believe that it, ethics, deal to morality and or good and bad conduct. DiPiazza (2002) says ¿½I see ethics as a mission-critical issue¿½. deeply embedded into who we are and what we do. It¿½s just as important as our product development cycle or our distribution system¿½it¿½s about creating a culture based on integrity and respect, not a culture based on dealing with the crisis of the day¿½We speak to ourselves every day, ¿½Are we doing the right things?¿½ Sheth, Gardner and Garret (1988) opine that to make an ethical decision is so complicated, and sometimes some of the business practitioners who are guilty in some cases have mentioned that they did not think that their activities could create ethical problems.

Arthaud-Day, 2005; Buller and McEvoy, 1999; Falkenberg, 2004; Windsor, 2004 demonstrate that Business organizations operating at international levels often find that many countries differ in what is considered as wrong or right in a business market. Therefore, here some certain fundamental questions will rise on the issues of international business ethics that are of concern in the current change of policy and in particular; the global business environment. For instance, which ethical norms should be applied and followed at global business environment?

Growing literature in international business ethics indicate that managing across borders involves dealing with ethical challenges that are complex and multifaceted They range from varying legal, political, economic and cultural conditions that provide a challenge for business executives who want to satisfy moral expectations across different countries and aim to integrate an ethical dimension into their strategic decision-making processes.

Bowie (1996) says almost all of the countries in the world are different in different ways like, physical setting, economic development and literacy rates and he argues that even if we accept an universal ethical and moral principle, we should believe they must be related to different cultures and background. Hence ethical behavior would still differ among cultures even though they may agree on fundamental universal moral principles.

Following the economic growth does not necessarily lead us to social development. In many cases as Leonard and McAdam, (2003) opine it may actually leads to bad physical environment, unsafe workplace, discrimination, urban decay and other social problems.

These environmental concerns have been expressed often than not. For instance, in one hand Beauchamp and Bowie (2004) report that there are other fundamental ethical issues associated with international business ethics, which include bribery, extortion, facilitation payments and human rights. On the other hand, Ferrell, Fraedrich and Ferrell (2002) describe global ethical issues as encompassing human rights, sexual and racial discrimination, price discrimination, bribery, harmful products, pollution and telecommunications issues. In this scenario, Hazarika, (1998) stated that it is no wonder that the attention of top management, governments and society are being directed towards corporate governance, corporate accountability and corporate social responsibility (CSR).

In a global business environment, responsible marketers discover that buyers want and respond to those offers which create value for sides, buyers and marketers. Sometimes people try to find a market for their products they think they are innocent but their products or their actions may affect a large part of the society. Consider the sale of cigarettes. Parker (1998) writes that the way corporations go about their business activities, with respect to business ethics performance, is increasingly important to their customers as well as all stakeholders of the corporation and the society in general. Customers in the marketplace are becoming increasing aware of and increasingly discriminating against corporations that fail to meet the customers¿½ criteria of acceptable versus unacceptable ethical business activities and management principles.

Norton Jouster, as cited by Hartman (2005), stated that, ¿½From here that looks like a bucket of water, but from an ant¿½s point of view, it¿½s a vast ocean; from an elephant¿½s point of view, it¿½s just a cool drink; and to a fish, of course, it¿½s home.¿½ Jouster¿½s statement is to imply, if we really are going to make a great change in the way that we handle our customers, we should consider different views of stakeholders and as we know the company itself is the most interested one in its success.

However, strict reporting, detailed codes of conduct rules and regulations are certainly necessary but not sufficient. Geoghegan & Azmi, (2005) argued that a company that has a well-known brand is like an individual who has a good name that enables him to make very good and strong relationships when he needs. Verhezen, (2005) says a corporate reputation shows and reflects the organization¿½s strategy, culture, and values.

As we mentioned earlier a good corporate reputation confirms the high level of trust in a company. It can make a strong relation with a number of stakeholders either emotional or intellectual and beside it can act as a source of authority and credibility for the company.

Boatwright, 2005; White, (2006) have explained that business ethics as a competitive advantage includes making good and permanent relationships with stakeholders and try to keep this relation based on honesty and integrity. Ethical relations in business is like human relations together and as all we know it is nothing but a two ways traffic line not a one way and it is based on mutual respect and trust. Successful business must treat the parties affected by the corporation¿½s actions as constituents to be consulted rather than spectators to be ignored. Doing so was just smart business. This was a novel step that was among the first attempts to characterize the impact of ethical behavior on a company¿½s financial performance.

Burgelman and Meza, (2001) argued that from the customers? perception, the illusion was real enough to draw tens of thousands of visitors per day from all corners of the globe to browse Amazon¿½s virtual bookshelves Today, Luftman et al., (1999) say Amazon¿½s state-of-the-art, highly-coupled supportive ICT infrastructure provides apparent seamless integration between internal and external databases of all kinds.

Also Gillenson et. Al, (1999) investigated that it¿½s sophisticated software that enable Amazon to predict customer interests in other products, based on the order profile of individual customers and of all others exhibiting similar product interests and purchasing patterns. Sing, (2002) believed while other online booksellers compete for a small piece of market share, Amazon uses its technological sophistication to promote continued expansion of the firm.

We should consider ethics in business as an important part regardless of the size of the business and or organization. Also it doesn¿½t matter whether your customers are many or few; the relevance of adhering to high ethical standards is the same. There are many organizations in the business world which, have put compulsory ethical standards.

Wolfe, (1994; Hendriks, (2001); Senge, (2001; Meyronin, (2004) all pointed out that organizations like Amazon, Dell, EBay, Google, numerous banks (e.g. Chase.com and Citibank.com), retail chains (e.g. LLBean.com, WalMart.com, and BestBuy.com), the travel industry (e.g. JetBlue.com, Avis.com, Orbitz.com, and Expedia.com), and price search engines (e.g. PriceGrabber.com, NextTag.com) are led by senior management teams who not only recognize the greater efficiencies that can be gained by leveraging new ICT technologies, but they actually create entirely new ways of marketing services based on ethical standards. These firms distinguish themselves by mixing aspects of marketing with their strategic operational approach that consider ethical issues as a necessity for this era of business and, in sum, bring about causal responses from consumers that may be deterministic responses. They recognize that by using ICT in a focused and deliberate fashion, they can create and leverage opportunities to provide accompanying marketing services while sustaining operational efficiency. What we are going to address here is to evaluate how important is for a company like amazon.com to be ethical from consumers¿½ angle. And what makes this research unique is to interview people directly.

What is business ethics?

Whichever way one looks at it, then, there appears to be good reason to suggest that business ethics as a phenomenon, and as a subject, is not an oxymoron. Whilst there will inevitably be disagreements about what exactly constitutes ¿½ethical¿½ business activity, it is possible at least to offer a fairly uncontroversial definition of the subject itself. So in sum, here we provide some statements to show what we mean by business ethics:

-Business ethics is an area of study which deal with situations, activities and decisions where right and wrong are the issues to be addressed. We should stress by right and wrong we mean not only morally right and wrong but also strategically, financially or commercially right and wrong. Moreover, by ¿½business¿½ ethics, we do not mean only commercial businesses, but also government organizations, pressure groups, NGO based businesses, charities, and other organizations. For example, questions about how to manage employees fairly, or what constitutes deception in advertising, are equally as important for organizations such as Green peace, the University of Stockholm, or the German Christian Democrat Party as they are for Shell, Volvo, or Deutsche Bank. However, given the high profile of ethical issues in relation to commercial businesses, it is on these types of businesses.

People still haven¿½t stopped to ask questions responding to statement about business ethics. Some people cannot even believe that it exists! Collins (1994) believes that business ethics is like a complicated term that has been used very much. By this we mean that we use this term to bring two apparently contradictory concepts, such as in ¿½cruel kindness¿½. To say that business ethics is an oxymoron suggests that there are not, or cannot be, ethics in business: that business is in some way unethical (i.e. that business is inherently bad), or that it is, at best, amoral (i.e. outside of our normal moral considerations). For example, in the latter case, Albert Carr (1968) argued that the standards for business game are not the same moral standards as the rest of society, but should be considered as an equal to a poker game where deception and lying were perfectly permissible.

To some extent, it is not surprising that some people think this way. Various scandals concerning undesirable business activities, such as the despoiling of rivers with industrial pollutants, the exploitation of sweatshop workers, the payment of bribes to government officials, and the deception of unwary consumers, have highlighted the unethical way in which some firms have gone about their business. However, just because such malpractices take place, this does not mean that there are not some kinds of values or principles driving such decisions. After all, even what we might think of as ¿½bad¿½ ethics is still ethics of a sort. And clearly it makes sense to try and understand why those decisions get made in the first place, and indeed to try and discover whether more acceptable business decisions and approaches can be developed.

Anything we get from corporate malpractice should not be interpreted to mean that even thinking about ethics in business can make trouble and is entirely redundant. Collins (1994) and Watson (1994) argued as various writers have shown, many everyday business activities require the maintenance of basic ethical standards, such as honesty, trustworthiness, and co-operation to make a situation in which people can work together get a SCA over competitors. Business activity would be impossible if corporate directors always lied; if buyers and sellers never trusted each other; or if employees refused to ever help each other.

Similarly, it would be wrong to infer that scandals involving corporate wrongdoing mean that the subject of business ethics is in some way naive or idealistic. Indeed, on the contrary, it can be argued that the subject of business ethics primarily exists in order to provide us with some answers as to why certain decisions should be evaluated as ethical or unethical, or right or wrong. Without systematic study, how are we able to offer anything more than vague opinions or hunches about whether particular business activities are acceptable?

Why business ethics are important for Amazon.com?

Nowadays business ethics is a very dominant business issue, and the debates, arguments, and dilemmas around business ethics topic have tended to gather a huge amount of attention from various sources. At the beginning stage buyers and pressure groups seem to be demanding that firms should seek out more ethical and ecologically ways in dealing with them and doing the business activities. From another angle we should care about media that is also constantly keeping spotlight on corporate abuses and malpractices. Even now firms themselves know that being ethical or at least being seen to be ethical actually is good for them. In recent years we have seen protesters in some of the big cities in the world for example in Seattle, London, Genoa, and elsewhere in fact challenging the nature of capitalism and the impact of global corporations on society. There are therefore many reasons why business ethics might be regarded as an increasingly important area of study, whether for students interested in evaluating business activities, or for managers seeking to improve their decision-making skills. Here there are the main reasons why we think that a strong understanding of business ethics is important:

1 .Importance, power, and business affect in the community is greater than ever. Bernstein based on evidence suggests that many people in the public don¿½t feel like these kind of developments. By business ethics we can better understand why this is happening, what are the contributions, and how we should handle this situation?

2. Business abuse has a great potential to hurt individuals, communities, and environment. To helping us to get a clear understanding about the causes and consequences of these abuses, in fact as Michalos (1988) cited business ethics, as founding editor of the journal of business ethics has suggested, seeks ¿½to improve the human condition¿½.

3. Business itself already has got the demand to be ethical. And it is becoming more complex and more challenging. Business ethics provides the means to appreciate and understand these challenges more clearly, in order to firms can meet these ethical expectations more effectively.

4. A few numbers of people in Europe and elsewhere have passed formal education on business ethics. Business ethics can help us in making ethical decisions by providing us suitable knowledge and some useful means that allow us to recognize, diagnose, analyze, and get solutions to those ethical issues correctly.

As we know in most European countries there is quite a dense network of regulation on most of the ethically important issues for business. Workers¿½ rights, social and medical care, and environmental issues are only a few examples where European companies could be said traditionally do not have to consider so very much moral values which should guide their decisions. All these regulations have been tackled, first time, by the government which tried to set up a tight organizational framework for businesses. Therefore we can claim in Europe all people who involve in business from, governments, trade unions, and corporate associations are the key actors in business ethics. In USA the situation is a bit different because in most of the areas, the organizational framework based in ethical issues in the business has been dramatically looser, so the key actor mostly tended to be corporations. Generally as we know even in USA when the law has not yet codified the ¿½right¿½ or ¿½wrong¿½ of a certain action, this would also seem to partially explain the longer legacy of the subject in the USA. However, Vogel (1992) says that the identification of the corporation as the key actor in the USA also means that corporate misconduct tends to face greater enforcement and harsher penalties. In sum we can say that all the people as stakeholders have an important role that sometimes those roles may make them key actors in the business so as we mentioned earlier firms must care about all partners. This is the situation in amazon.com as well where they put every action based on what their costumers want. They think about what makes their costumers satisfied. If we suppose that there are three important factors for every business: profit, planet and people, for amazon.com the role of people are dominant. Still it doesn¿½t mean that they ignore the other factors but the way that they do their activities show the key factor is the people.

Amazon.com and SCA planning

In their work Scott et al. (2000) opine that the development of the social perspective on sustainability has tended to trail behind that of the environmental and economic perspectives and remains a relatively new development. The explicit integration of social concerns into the business discourse around sustainability can be seen to have emerged during the 1990s, primarily; it would seem, in response to concerns regarding the impact of business activities on indigenous communities in less developed countries and regions. It would be wrong to assume though that this means that, until this time, local community claims on business (and other social issues) went entirely unheard by business, or unexamined by business ethics scholars. However, the inclusion of social considerations such as these within the specific domain of sustainability marked a significant shift in the way that notions of sustainability were conceptualized.

The key issue in the social perspective on sustainability is that of social justice. Despite the impressive advances in standards of living that many of us have enjoyed, the UN (2001) report on the World Social Situation identified growing disparities in income and wealth within many countries, including much of Latin America, Eastern Europe, and almost two-thirds of OECD countries. Similarly, the report identified a continued widening in the distance between richer and poorer countries. Business ethics of a firm has been defined as one of the invaluable intangible assets for competing. In general, intangible assets are assuming increasingly competitive significance in rapidly changing domestic and global markets. As the speed of comparable tangible assets acquisition accelerates and the pace of imitation quickens, firms that want to sustain distinctive global competitive advantages need to protect, exploit and enhance their unique intangible assets, particularly integrity. Petrick & Quinn, (2001) claim that: Firms must understand stakeholders¿½ interdependence, explain ethical awareness, and give effective reaction to moral issue. Management they believe that must put themselves in a position of a competitive advantage in comparison to other companies by making a list of ethics capacities. International organizational leaders can and should be held accountable for enhancing the intangible strategic asset of integrity capacity in order to advance global organizational excellence. The situation makes us to do something different which makes us distinguishable from other companies like Svensson & Wood, (2004) expressed that the marketplace with globalization is becoming increasingly aware of, and increasingly discriminating against, corporations that fail to meet the criteria of ethical business operations and ethical management principles. Also SCA needs change, as porter (1998) argued it demands that a company invest to close off the way along which competitors could attack. Regardless of the size, nowadays, firms are very clear about ethical issues and their importance in the era of globalization thus they are developing their strategies to use their resources ethically to get their goals and objectives. In amazon.com planners believe that business ethics program helps owners and managers improve their business performance, make profits, and contribute to the economic progress of their communities ethically by meeting the reasonable expectations of their stakeholders.

From their point of view program can help them to achieve specific expected program outcomes, such as increasing awareness of ethics issues, improving decision-making, and reducing misconduct. To be effective over time, amazon.com business ethics program aims to be a formal plan, because it touches on all aspects of the enterprise¿½operations, human resources, communications, and marketing to name but a few. Formally planning a business ethics program ensures that owners and managers give due consideration to the enterprise¿½s relevant context, organizational culture, and reasonable stakeholder expectations.

Busy managers need not fear that formal planning for a business ethics program will overwhelm daily operations because, as discussed before, they already have many elements in place. The planning process requires targeted stakeholder participation more than a large staff. However, once an enterprise announces its intention to design and implement a business ethics program, it needs to plan well and to base its plan on its core beliefs. Hediger (1999) noted that the concept of sustainability is generally regarded as having emerged from the environmental perspective, most notably in forestry management and then later in other areas of resource management. Indeed, it would probably be true to say that, at the present moment, there is still a fairly widespread conception within business that sustainability is a purely environmental concept. But for amazon.com the issue is somehow different because they care either people or planet.

The basic principles of sustainability in the environmental perspective concern the effective management of physical resources so that they are conserved for the future. Whereas in amazon.com managers are more concern about trust, delivery and security beside they vie to make a competitive advantage based on lower prices as well. It doesn¿½t mean they don¿½t care about environmental issues. Amazon.com has several sustainable competitive advantages (SCAs) that arise from strategic positioning that should contribute to sustained profitability if executed correctly. Amazon.com has patented one-click ordering, an SCA that cannot easily be copied or duplicated as Amazon.com holds the patent. Amazon.com¿½s innovation to automatically suggest other items based upon previous purchases has become valuable both to customers and the company. Amazon.com also owns a patent on the Associates program, allowing consumers to have access to online stores from which it draws royalties. Amazon.com simply handles the transaction processes for these retailers. It can be argued that by allowing the sale of used books on its Web site, Amazon.com has created a SCA by creating a sense of community. Amazon.com mirrors EBay¿½s business model which aims to create a sense of community, a bond per se, that keeps people coming back to do business. Amazon.com makes it extremely easy for consumers to sell or buy books online. The company handles the payment transaction and then deposits the money, minus the fee, into the seller¿½s bank account. EBay, the Web¿½s most popular and profitable online auction, implemented a similar process. Theoretically, the strategy helps Amazon.com sell more items by allowing a customer with limited funds to purchase more items instantly. This generates repeat customers. Bezos describes Amazon.com¿½s marketing strategy as one that is designed as Qu, Zhonghua and Michael Brocklehurst (2003) find out to, ¿½strengthen and broaden the Amazon.com brand name, increase customer traffic to our websites, encourage customers to shop in many product categories, promote repeat purchases, and develop incremental product and service revenue opportunities.¿½ An emphasis is placed on improving the total customer experience through the delivery of personalized Web pages and services, ease of use, selection, availability, free on-time shipping and of course the lowest prices possible.

Qu¿½au, Philippe (2002) expressed that Amazon.com uses a variety of online and traditional advertising, including sponsored links, e-mail, print media, direct marketing, television, and other offline advertising campaigns to reach customers. Bezos feels that the company¿½s direct marketing efforts are unique and effective: ¿½I would claim that Amazon.com is one of the few companies that really have put a huge amount of effort into one-to-one marketing with the personalization features on our website.¿½

Senge, P. M., G. Carstedt, et al. (2001) cited that in 2001, Amazon.com¿½s CEO stated that, ¿½People had higher expectations for the next couple of years than are likely to be realized ¿½And people have much lower expectations for the next couple of years than are likely to be realized over the next 10 years.¿½

Industry analysts assert that the greatest challenge facing e-retailers is the ability for consumers to click from one site to another in search of the lowest price. Only 10 years ago, finding the best price for a book or movie meant driving from store to store. However, Zaheer, Srilata (1995) says now buyers can go online and compare prices for new and used books on at least 10 different Web sites. This one characteristic of the Internet retail industry exemplifies the challenge facing Amazon.com and demonstrates the threat of all five competitive forces identified by Porter:

1) The entry of new competitors

2) The threat of substitutes

3) The bargaining power of buyers

4) The bargaining power of suppliers

and 5) the rivalry among the existing competitors.

One is creating an SCA that will give a business enough time to build customer loyalty and profits. The second is positioning. If a company creates a competitive advantage, it must continue to improve upon that strategy. A competitive advantage is a living, breathing entity. To maintain a sustainable competitive advantage requires constant nurturing and encouragement to grow and adapt to its environment.

There is actually quite a lot people can do at Amzaon.com other than buy a book. we can create wish lists, write reviews, manage our one-click account, we can sell books, or music, or videos, and we can have our books printed on-demand. A non-store retailer such as Amazon.com is poised to be successful globally with the increasing spread and prevalence of the Internet and World Wide Web. The success of Amazon.com's global strategy would come from utilizing technological and global efficiencies of scale, lower costs of operations, enhanced customer service at lower costs due to better customer information and relationship management, and better adaptability to local tastes and preferences due to superior information collection and analysis. What competitive advantages does Amazon.com bring to each of these businesses? While Amazon.com may compete well on price on non-perishable food items in small size that can be shipped easily, as books can, they are less well prepared to compete on other types of grocery purchases. In terms of apparel retailing online, there are many players in this market and the prices may not be much lower on Amazon's site as compared to those offered by other players in these markets. Apparel shopping on Amazon.com is most likely to succeed with those consumers who want a one stop shop for clothing, books, entertainment, small appliances, etc.

A model that shows the importance of ethic in SCA regarding to amazon.com case

As we emphasized all above, firms must be clear about their interdependence to stakeholder. Because it is all about stakeholders and the way how firms handle them. Although we know conceptions of ethics and what is right and wrong in different countries are different but still we believe that there is a globally accepted understanding of what is ethical in the business. Therefore we make our model based on those factors that are very important in getting the CA over competitors. First of all, in our opinion, governments must set up rules and regulations to prevent any kind of self interpretation by firms in using the resources and providing services just for their own profit. When the rules are made firms must be as transparent as possible because they are seen by controlling systems, trade unions, pressure groups and mostly by community so they will fell that they need to be moral persons and moral leaders. They will understand that they need to compete in a market in which people know a lot more than before about business and products¿½ quality.

Even nowadays people really care about environment therefore, a firm that wants to get CA must try to enhance its own quality regarding to ethical issues and try to give useful information to its customers. Based on ethical theory every single firm must keep its relations to its internal and external environment because all of them are important.

Sometimes each one can play an important role for the company if a firm cares about its reputation and at the same time pays more attention to its stakeholders and try to satisfy them it can be hopeful to get a sustainable competitive advantage over competitors if it ignores the basic rules in business ethics it will not survive in mean time. So as we consider in our paper firms must understand stakeholders¿½ interdependence, explain ethical awareness, and give effective reaction to moral issue. Management they believe that must put themselves in a position of a competitive advantage in comparison to other companies by making a list of ethics capacities. International organizational leaders can and should be held accountable for enhancing the intangible strategic asset of integrity capacity in order to advance global organizational excellence. The situation makes us to do something different which makes us distinguishable from other companies like Svensson & Wood, (2004) expressed that the marketplace with globalization is becoming increasingly aware of, and increasingly discriminating against, corporations that fail to meet the criteria of ethical business operations and ethical management principles.

There are myriad ways in which this phenomenon may be explained but most often, they usually differ because of the fundamental differences dominating the mentality that each firm maintains oward ICT as well as the perceived strategic direction these firms assume ICT will take them. For example, competitor firms Amazon.com, BarnesandNoble.com and BooksAMillion.com ach have more or less the same user interfaces and overall processing capabilities, yet neitherhas a market share anywhere near that of the Amazon.com, the industry leader.

Model of relations between ethics and SCA in Amazon.com

Input

Out put

DISCUSSION AND CONCLUSION

Nowadays most of the firms are going to be sustainable organizations through building value for stakeholders in long term. At the same time they want to be responsible corporate citizen.

It is globally believed that the only way to achieve that is to incorporate economic, social and environmental codes of conduct into business strategy. Furthermore, being in global business involved organizations with different cultures and social systems that definitely require more attention to managing the activities in a diverse business market. With this development, ethical considerations become more important.

Thus, the importance of building a strong ethical culture is integral to the reputation, growth and finances of any organization. If firms work in this way their brands will be in positive situations that can attracts the best talent and make long live trust among the stakeholders. Although all companies initially are focused on the benefit for stakeholders, but they have actually a wide ranging set of responsibilities to their own suppliers, customers and employees, to the communities in which they are operating. Most corporations recognize these responsibilities and make a serious effort to fulfill them while trying to utilize their business ethics as a source of competitive advantage. In current competitive business market companies are heavily engaged in a universe of relationships with multiple stakeholders.

With the globalization the scenario in which companies operate has become even more complex, given the emergence of global groups of stakeholders. Furthermore, Friedman (2000) investigated that globalization has also increased the levels of competition among firms, which look for new a creative ways to create a competitive edge. There is also an argument that ethics are natural market consequence of business ¿½ customers, clients, employees all want their companies to be ethical, so it is the company¿½s best interests to be so.

Last but not the least, there is another face of business ethics that could be managed also to gain a competitive advantage, which is corporate ethics. On the one hand, business ethics has an external emphasis. Business ethics considers the gap between the corporation¿½s ethical behavior and the market place¿½s perception of the corporation¿½s ethics in its business operations. Corporate ethics, on the other hand, has an internal emphasis and this could be well managed toward a unique competitive advantage as anything related to people (corporate ethics through people) is very difficult to imitate and this raises the chances of achieving a sustainable competitive advantage. Future researches are needed in this particular issue of corporate ethics as sustained competitive advantage. Business ethics can provide us with the ability to assess the benefits and problems associated with different ways of managing ethics in organizations.

Finally, business ethics is also extremely interesting in that it supplies us with knowledge that transcends the traditional framework of business studies and confronts us with some of the most important questions faced by society. The subject can therefore be richly rewarding to study because it provides us with knowledge and skills which are not simply helpful for doing business, but rather, by helping us to understand modern societies in a more systematic way, can advance our ability to address life situations far beyond the classroom or the office desk.

This is not to say there are not problems with the subject of business ethics, and these have prompted writers such as Andrew Stark (1994) to pose the question ¿½what¿½s the matter with business ethics?¿½ and Tom Sorrell (1998) to pronounce on the ¿½strange state of business ethics¿½.

After all, despite many years of business ethics being researched and taught in colleges and universities, ethics problems persist and the public remains skeptical of the ethics of business.

Yet for those consumers interested in purchasing and owning DVDs, Amazon.com will bring a competitive advantage to selling DVDs mainly through their name recognition over many other dot.com companies. Also, Amazon has an amazing database system that will be able to better target their customers and keep track of their purchases. Amazon¿½s distribution system will be able to deliver the goods in minimal time at a minimal cost. Thus, instead of costly packaging and stocking at retail stores, Amazon could simply offer the product for immediate download, thereby also providing the immediate gratification that is typically lacking for most products purchased over the Internet.

If Amazon.com offers an equal or lower price than a conventional bookstore and free or subsidized shipping, why not try it as an experiment? Sooner or later, though, some customers can be expected to return to more traditional modes of commerce, especially if subsidies end, making any assessment of customer loyalty based on conditions so far suspect. Finally, some ¿½revenues¿½ from on-line commerce have been received in the form of stock rather than cash. Much of the estimated $450 million in revenues that Amazon has recognized from its corporate partners, for example, has come as stock. The sustainability of such revenue is questionable, and its true value hinges on fluctuations in stock prices. When Amazon and other rivals entered the business, offering free auctions, eBay maintained its prices and pursued other ways to attract and retain customers. As a result, the destructive price competition characteristic of other on-line businesses has been avoided. It deterred the on-line store from capitalizing on the many advantages provided by the network of physical stores, thus playing into the hands of Amazon.