Business Bluffing Essay

The moral status of business bluffing is a controversial issue. On the one hand, bluffing would seem to be relevantly similar to lying and deception. Because of this, business bluffing can be taken to be an activity that is at least prima facie morally condemnable. On the other hand, it has often been claimed that in business bluffing is part of the game and that therefore there is nothing morally questionable in business bluffing (Allhoff,2006). An attitude of extreme arrogance permeates the business world today.

In the wake of the post-modern discretion of most independent standards of moral behaviour, capitalists the world over are relatively free to worship at the hollow idol of the Market, unhindered by the ethical standards that inform the rest of society. In South Africa this estrangement from the moral has, in one instance, resulted in the mass reduction of permanent positions available to workers in favour of unstable short-term contracts or, what anti-corporate globalisation activists refer to as, McJobs.

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By ignoring the deep psychological effects that this sort of insecure existence has on employees, the business world has shown itself to be arrogant and indifferent to the ethical standards of the society “outside” of itself. It is often argued whether business bluffing is ethical or not. Defining business bluffing According to Encarta World English Dictionary bluffing means to deceive, mislead, or instill fear or doubt in somebody by a false show of strength or confidence and business means commercial activity involving the exchange of money for goods or services.

Having to incorporate the two definitions one can define business bluffing as misleading within the boundaries of business. The moral status of business bluffing is a controversial issue. On the one hand, bluffing would seem to be relevantly similar to lying and deception. Because of this, business bluffing can be taken to be an activity that is at least prima facie morally condemnable. On the other hand, it has often been claimed that in business bluffing is part of the game and that therefore there is nothing morally questionable in business bluffing . Abstract

Carr gives the example of a Cornell honour graduate who, in a psychological test, has to indicate which publications he reads regularly. The graduate, however, is concerned that by indicating the actual “progressive” publications he reads he will be considered as a radical and, thus, put himself at a disadvantage. He finally chooses to lie and selects several conservative publications which he thinks will be more in sync with the policies of his employers – his hunch turns out to be right, and he gets the job. According to Carr, the graduate has made a game player’s decision which is consistent with business ethics.

A recent film also provides another example of this sort of dilemma. In Jerry Maguire, Cuba Gooding, Jr. plays a football player approaching retirement, and Tom Cruise plays his sports agent. Throughout his football career Gooding’s character has always played the game to the best of his ability and is regularly featured on the scoring list. However, his on-field ability has never been reflected in monetary terms, as the contracts he signs with the football teams inevitably see him earn less than more popular and less skilled players.

His agent advises him that his problem is not with his skill level but rather with the fact that he doesn’t entertain the crowd, as other players do, when he scores a touchdown. This causes him to be unpopular with crowds as he appears to be arrogant which subsequently is reflected negatively on his pay-slips. The solution, Cruise tells him, is to forget about his pride and do a touchdown dance like all the other players. In the films climatic ending Gooding’s character scores the game-winning touchdown but is subsequently knocked unconscious.

The crowd cheers for him, and when he eventually awakes, ball still in hand, he is faced with a decision – to dance and get a bigger pay day or to walk away as usual and face a penniless retirement. In the end he decides to dance and the million-dollar offers start rolling in. This clearly is what Carr wants business people to do. To play the game means dancing when and how people tell you to. It means forgetting about personal values and integrity, all in the effort to make money by conforming to questionable standards. The Cornell honours graduate and Cuba Gooding Jr. ay have been financially rewarded by deciding to play the game through their acts of deception, but in the long run they have sacrificed something greater, namely, their sense of personal integrity, values and identity. In short, they have given up their individuality for the benefits and warm safety of conformity. To conform, in the Heideggerian sense of the word, means to lose oneself in the crowd, it is a losts of identity and is ultimately a form of self-deception. In the classic existential language, this might also be categorised as a manifestation of bad faith.

This extremely useful philosophic concept has been strangely under-utilized by most contemporary philosophers, with the possible exception of several notable critical race and liberation theorists who have used it to explain the situation of the oppressed in a racist/colonial/neo-colonial world. Most executives from time to time are almost compelled, in the interest of their companies or themselves, to practice some form of deception when negotiating with customers, dealers, labor unions, government officials or even other department of their companies.

By conscious misstatements, concealment of pertinent facts, or exaggeration-in short, by bluffing-they seek to persuade others to agree with them. I think it is fair to say that if the individual executive refuses to bluff from time to time-if he feels obligated to tell the truth, the whole truth, and nothing but the truth-he is ignoring opportunities permitted under the rules and is at a heavy disadvantage in his business dealings. But here and there a businessman is unable to reconcile himself to the bluff in which he plays a part.

His conscience, perhaps spurred by religious idealism, troubles him. He feels guilty; he may develop an ulcer or a nervous tic. Before any executive can make profitable use of the strategy of the bluff, he needs to make sure that in bluffing he will not lose self-respect or become emotionally disturbed. If he is to reconcile personal integrity and high standards of honesty with the practical requirements of business, he must feel that his bluffs are ethically justified.

The justification rests on the fact that business, as practiced by individuals as well as by corporations, has the impersonal character of a game-a game that demands both special strategy and an understanding of its special ethics. The game is played at all levels of corporate life, from the highest to the lowest. At the very instant that a man decides to enter business, he may be forced into a game situation, as is shown by the recent experience of a Cornell honor graduate who applied for a job with a large company: This applicant was given a psychological test hich included the statement, “Of the following magazines, check any that you have read either regularly or from time to time, and double-check those which interest you most. Reader’s Digest, Time, Fortune, Saturday Evening Post, The New Republic, Life, Look, Ramparts, Newsweek, Business Week, U. S. News ; World Report, The Nation, Playboy, Esquire, Harper’s, Sports Illustrated. ” His tastes in reading were broad, and at one time or another he had read almost all of these magazines.

He was a subscriber to The New Republic, an enthusiast for Ramparts, and an avid student of the pictures in Playboy. He was not sure whether his interest in Playboy would be held against him, but he had a shrewd suspicion that if he confessed to an interest in Ramparts and The New Republic, he would be thought a liberal, a radical, or at least an intellectual, and his chances of getting the job, which he needed, would greatly diminish. He therefore checked five of the more conservative magazines. Apparently it was a sound decision, for he got the job.

He had made a game player’s decision, consistent with business ethics. A similar case is that of a magazine space salesman who, owing to a merger, suddenly found himself out of a job: This man was 58, and, in spite of a good record, his chance of getting a job elsewhere in a business where youth is favored in hiring practice was not good. He was a vigorous, healthy man, and only a considerable amount of gray in his hair suggested his age. Before beginning his job search he touched up his hair with a black dye to confine the gray to his temples.

He knew that the truth about his age might well come out in time, but he calculated that he could deal with that situation when it arose. He and his wife decided that he could easily pass for 45, and he so stated his age on his resume. This was a lie, yet within the accepted rules of the business game, no moral culpability attaches to it. Critical discussion According to Carr, business peoples all, at one time or another, feel the pressure to deceive. They are compelled, in the interests of their company or themselves, to practice some form of deception when engaged in negotiations with others (e. g. ustomers, unions). This deception by conscious misstatements, concealment of facts, or exaggeration is undertaken with the strict purpose of seeking to persuade others to agree with them. Agreement, of course, implies a host of benefits for either the individual or the company or for both. if the individual businessman or executive refuses to engage in these acts of deception from time to time – if he feels an obligation (by way of his personal ethics) to tell the whole truth – then he is ignoring opportunities permitted under the rules of the game and effectively putting his business at a heavy disadvantage.

Thus, to forego these personal ethical obligations and misgivings about deception and to realise the effectiveness of the “bluff” as a legitimate tool within the game of business involves first and foremost recognition by the businessman that in bluffing he will not lose self-respect or become emotionally troubled. What this means is that if the businessman is to achieve a harmonious unity between his personal integrity and high standards of honesty, on the one hand, and, on the other hand, the practical requirements of business, then he must feel that his acts of deception are ethically justified.

This justification comes from the fact that “business, as practiced by individuals as well as corporations, has the impersonal character of a game – a game that demands both special strategy and an understanding of its special ethics. ” (Carr 1968:101, italics added) Once the individual enters into a business situation, one is thus necessarily in a game situation and success or failure depends largely on one’s ability, whatever one’s position in the company, to play the game in the appropriate way. More often we refer to the game of business but what exactly is the game and what does it involve?

The analogy Carr draws on to illustrate his argument is one of business as a game of poker. According to Carr, we can learn a great deal about the nature of business by comparing it with poker. Both rely largely on elements of chance, but in the long run it is the player with the most consistent skill level that wins. Carr claims that to achieve victory in both “games” requires an intimate knowledge of the rules, self-discipline, insight into the psychology of the other “players”, and the ability to respond swiftly and decisively to opportunities provided by chance.

He adds that poker has its own brand of ethics that is different from the ethical ideals of civilised human relationships. Furthermore, nobody who plays poker expects it to be played on the basis of the ethical principles that are espoused in churches. It is well within the rules of poker to bluff a fellow player and if that bluff is successful the winning player ought not to feel any sympathy for the loser, as it was up to him (the loser) to protect himself from losing. The implication, of course, is that poker isn’t a game for people with weak constitutions.

If any sympathy is shown for the loser it is regarded as personal gesture which must be separated from the rules of the game. Thus, it is game that necessitates a certain distrust of the other players and which must also ignore any claims to friendships. In a game like poker, which has many well-established rules, the most skilful player is not necessarily the player who has the best comprehension of these rules, but is rather the player who can best maneuver within these boundaries. The poker player who is adept at bluffing is considered skilful precisely because he is capable of deceptive maneuvering within the confines of the game.

Deception, of course, is a vital part of most games. This is primarily because, once all game players reach a certain level of technical proficiency, it becomes difficult to gain victory over opponents using abilities that the other player possesses in equal amounts – the trick in such a situation is to bluff. In that regard boxing – a game with which South Africans are much more familiar – is perhaps one of the leading exponents of the strategy of the bluff. Faking left when you want to punch right or using deceptive foot movement to upset the stance of the other boxer are just some of the instances where the bluff is used to great effect.

As an interesting aside, who could forget Mohammed Ali’s famous “roper-dope” strategy employed during his fight against George Foreman. Ali, who was much older than his opponent, played possum for most of the fight, while at the same time using the ropes as support against the onslaught of Foreman before he knocked the tiring boxer out – surely claiming the mantle of the greatest bluff in sport history. But, although deception plays an important part of most games it is seldom frowned upon by other players. Indeed, many game players will compliment their opponents on successfully deceiving them.

In such instances the deceived player will often call the deceiver a “sneaky bastard” or tell him that he “really pulled the wool over my eyes”, and on such occasions most deceivers will smile slyly and thank the opponent for the compliment. But in our everyday lives no person wishes to be called a “sneaky bastard” or to have the wool pulled over their eyes primarily because to be called sneaky implies that you are a person who is dishonest or untrustworthy, while having the wool pulled over your eyes implies that you have been unfairly mislead.

So why do we accept such “compliments” in the game arena? Precisely because it is a game arena, that is, games are occasions where we suspend the rules of society to participate in artificial or constructed scenarios. These constructed scenarios are morally sterile and deliberately distant from the situations we find ourselves in everyday. After all, games are meant to be fun and to offer a relief from our, very often, mundane lives. This is why games are often called a “suspension of reality”. For a few hours we forget about our lived reality to participate in activities that are distant from it.

Findings We live in what is probably the most competitive of the world’s civilized societies. Our customs encourage a high degree of aggression in the individual’s striving for success. Business is our main area of competition, and it has been ritualized into a game of strategy. The basic rules of the game have been set by the government, which attempts to detect and punish business frauds. But as long as a company does not transgress the rules of the game set by law, it has the legal right to shape its strategy without reference to anything but its profits.

If it takes a long-term view of its profits, it will preserve amicable relations, so far as possible, with those with whom it deals. A wise businessman will not seek advantage to the point where he generates dangerous hostility among employees, competitors, customers, government, or the public at large. But decisions in this area are, in the final test, decisions of strategy, not of ethics. Given business people’s mandate to serve the interests of their company, there is pressure to bluff if it leads to a profitable result.

Sometimes this leads them to act in one way on the job and another way in their personal lives. Carr considers this to be a normal part of the business world (Carr 1968). The rules of ethical behaviour in business differ from those in personal life, making something wrong at home not necessarily wrong at work (Allhoff 2003). It might be considered shrewd business tactics to tell two suppliers that they can both have one’s account, for instance, but would be considered cruel to tell both one’s children they can go on a trip, if in reality only one can do so.

Similarly, parents often tell their children to do unto others as they would have done to them, also known as the golden rule, yet will be rewarded for taking advantage of a situation that presents at work. Business bluffing like bluffing in general is not really can be considered unethical. Bluffing is considered to not be telling the truth which in sense makes for bad business. An individual within a company often finds it difficult to adjust to the requirements of the business game. He tries to preserve his private ethical standards in situations that call for game strategy.

When he is obliged to carry out company policies that challenge his conception of himself as an ethical man, he suffers. It disturbs him when he is ordered, for instance, to deny a raise to a man who deserves it, to fire an employee of long standing, to prepare advertising that he believes to be misleading, to conceal facts that he feels customers are entitled to know, to cheapen the quality of materials used in the manufacture of an established product, to sell as new a product that he knows to be rebuilt, to exaggerate the curative powers of a medicinal preparation, or to coerce dealers.

There are some fortunate executives who, by the nature of their work and circumstances, never have to face problems of this kind. But in one form or another the ethical dilemma is felt sooner or later by most businessmen. Possibly the dilemma is most painful not when the company forces the action on the executive but when he originates it himself-that is, when he has taken or is contemplating a step which is in his own interest but which runs counter to his early moral conditioning.

Temptations of this kind constantly arise in business. If an executive allows himself to be torn between a decision based on business considerations and one based on his private ethical code, he exposes himself to a grave psychological strain. This is not to say that sound business strategy necessarily runs counter to ethical ideals. They may frequently coincide; and when they do, everyone is gratified. But the major tests of every move in business, as in all games of strategy, are legality and profit.

A man who intends to be a winner in the business game must have a game player’s attitude. As we have established, a game ceases to be a game once its standards of right and wrong clash with the standards of the society outside it. Perhaps we should examine a subtler example: an executive deceives an employee into thinking that in one years time he will receive a promotion and a suitable pay increase. The employee was initially reluctant to stay on at the company because he received lucrative offers rom other companies, but, once the executive assured him of his future at the company, he made the decision of staying on at his present company. The executive, however, has no intention of promoting this particular employee as he is indispensable in his current position – what he hopes to achieve by his deception is to buy some time to train somebody else to take over in a year’s time. A year later the employee is no longer in demand, as the glut in the market has been filled, and he is actually fighting for his position in his present company.

This might, on face value, appear to be a case where the consequences of the executive’s deception are restricted within the business scenario – after all his act of deception was a necessary step that had to be taken to save the company money and the employee is always welcome to stay on in his old position, provided he accept that he will not be promoted. In the business game arena, the winner would obviously be the executive and the loser the employee – in this regard in appears to be a neat end to a game situation.

But it is clear that the employee is a loser not only in the business arena, but also in the private arena for all his future plans for a prosperous life are now decidedly bleak. If the employee calls the executive a “sneaky bastard”, he is quite obviously not paying him a compliment on his skilful deception, but is rather saying that the executive acted in an unfair manner – i. e. he makes recourse to ethical standards outside of the game scenario. This clearly indicates that he has been affected on a private or personal level.

The consequences of the bluff thus move beyond the “game” arena and, as such, this cannot be called a game player’s decision. We have now established that Carr’s analogy of business as the game of poker is at best very tenuous as it fails to grasp the notion that the consequences of business decisions or deceptions very often move beyond the business arena. CONCLUSION The concept of bluffing in business ethics is a complex issue with many offering different opinions about it and a variety of applications in real life situations. Some contend that bluffing is just part of the game of business (Carr 1968).

For others, it is a moral responsibility of persons hired to contribute to company profits. Still others consider it morally questionable and advocate a departure from game analogy by the business community (Allhoff 2003). Regardless of opinions, however, bluffing will continue to be used in many business transactions, and the wise and ethical business person will do so only in situations where human lives are not at stake. I agree that the basis of private morality is a respect for truth and that the closer a businessman comes to the truth, the more he deserves respect.

At the same time, I feel that most bluffing in business might be regarded simply as game strategy-much like bluffing in poker, which does not reflect on the morality of the bluffer. We can learn a good deal about the nature of business by comparing it with poker. While both have a large element of chance, in the long run the winner is the man who plays with steady skill. In both games ultimate victory requires intimate knowledge of the rules, insight into the psychology of the other players, a bold front, a considerable amount of self-discipline, and the ability to respond swiftly and effectively to opportunities provided by chance.

BIBLIOGRAPHY

Carr, A. Z. 1968. “Is Business Bluffing Ethical? ” Harvard Business Review, Jan. /Feb. : 143 –153. Allhoff, F. 2006. Journal of Business Ethics, Volume 65, Number 2, May 2006, pp. 163-171(9) Gordon, L. R. 1995. Bad Faith and Anti-Black Racism. New Jersey: Humanities Press. Allhoff, F. 2003. Business bluffing reconsidered. Journal of Business Ethics, Vol. 45, Iss. 4; July 2003, pg. 283-289 Bluffing. Retrieved September 14, 2010, Microsoft Encarta World Dictionary [World English Edition] 2010 from http:/encarta. msn. con/dictionary186181654/bluffing. html