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    04 - Act Strat 02

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    chester.deft11
    Friedman's Traditional View holds that businesses should primarily aim to maximize profits for shareholders within legal boundaries. This promotes clear decision making but can ignore other factors. In contrast, Carroll's Four Responsibilities of Business provides a framework that includes economic, legal, ethical and discretionary responsibilities. Meeting these responsibilities in areas like community involvement can build trust and relationships leading to long term success, providing a more holistic approach. While balancing multiple objectives can be challenging, Carroll's model considers societal and environmental impacts alongside financial goals for greater sustainability.

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    04 - Act Strat 02

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    chester.deft11
    10 views2 pages
    Friedman's Traditional View holds that businesses should primarily aim to maximize profits for shareholders within legal boundaries. This promotes clear decision making but can ignore other factors. In contrast, Carroll's Four Responsibilities of Business provides a framework that includes economic, legal, ethical and discretionary responsibilities. Meeting these responsibilities in areas like community involvement can build trust and relationships leading to long term success, providing a more holistic approach. While balancing multiple objectives can be challenging, Carroll's model considers societal and environmental impacts alongside financial goals for greater sustainability.

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    Friedman's Traditional View holds that businesses should primarily aim to maximize profits for shareholders within legal boundaries. This promotes clear decision making but can ignore other factors. In contrast, Carroll's Four Responsibilities of Business provides a framework that includes economic, legal, ethical and discretionary responsibilities. Meeting these responsibilities in areas like community involvement can build trust and relationships leading to long term success, providing a more holistic approach. While balancing multiple objectives can be challenging, Carroll's model considers societal and environmental impacts alongside financial goals for greater sustainability.

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    Download as DOCX, PDF, TXT or read online from Scribd
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    10 views2 pages

    04 - Act Strat 02

    Uploaded by

    chester.deft11
    Friedman's Traditional View holds that businesses should primarily aim to maximize profits for shareholders within legal boundaries. This promotes clear decision making but can ignore other factors. In contrast, Carroll's Four Responsibilities of Business provides a framework that includes economic, legal, ethical and discretionary responsibilities. Meeting these responsibilities in areas like community involvement can build trust and relationships leading to long term success, providing a more holistic approach. While balancing multiple objectives can be challenging, Carroll's model considers societal and environmental impacts alongside financial goals for greater sustainability.

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    of 2

    Friedman’s Traditional View

    Plus (Advantages) - Friedman's Traditional View asserts that businesses should primarily aim to
    maximize profits for shareholders while operating within legal boundaries, prioritizing economic
    concerns. This approach promotes clear decision-making and efficient resource use. By focusing on
    profit, companies can invest in growth, innovation, and competitiveness. This clear objective aligns
    stakeholders and directs strategic decisions, leading to sustained financial health and growth.

    Minus (Disadvantages) - Friedman's Traditional View, which prioritizes profit maximization as a


    business's primary objective, can impede success in today's environment. This singular focus on profits
    might cause companies to ignore essential elements like employee welfare, customer contentment, and
    sustainable practices. Consequently, this limited perspective can result in flawed choices, neglect of
    societal and environmental obligations, and harm the company's reputation and competitive edge in the
    future. Therefore, strict adherence to Friedman's approach may actually hinder rather than promote
    organizational success.

    Interesting - Friedman's Traditional View emphasizes that the main objective of a business is to
    maximize shareholder wealth. This involves prioritizing profit generation and efficiency to achieve
    organizational success. Essentially, businesses should focus on activities that increase profitability,
    improve operational efficiency, and benefit shareholders financially. Adhering to this profit-centric
    approach, according to Friedman, allows businesses to thrive sustainably and fulfill their fundamental
    purpose in the market.

    Caroll’s (4) Four Responsibilities of Business


    Plus (Advantages) - Friedman's Carroll's Four Responsibilities of Business provide a clear framework for
    organizations to achieve success. These responsibilities include economic, legal, ethical, and
    discretionary aspects. Prioritizing economic responsibilities, like profitability, ensures sustainability and
    growth. Meeting legal obligations maintains compliance and stability. Embracing ethical responsibilities
    builds trust and reputation. Addressing discretionary responsibilities, such as philanthropy, benefits
    society and strengthens relationships, leading to long-term success.

    Minus (Disadvantages) - Carroll's Four Responsibilities of Business, encompassing economic, legal,


    ethical, and discretionary aspects, can pose challenges to achieving organizational success due to
    potential conflicts. Balancing economic objectives with legal compliance, ethical conduct, and
    discretionary efforts can be difficult, diverting resources from core functions. Interpretations of ethical
    duties may vary among stakeholders, leading to ambiguity and potential conflicts. Emphasizing
    discretionary responsibilities could strain finances without immediate returns, impacting profitability
    and overall success. Achieving long-term organizational success requires balancing these responsibilities
    while ensuring profitability and sustainability.

    Interesting - Carroll's Four Responsibilities of Business highlight key areas for companies to focus on for
    success: economic, legal, ethical, and philanthropic. These include making profits and growing
    (economic), adhering to laws (legal), operating with fairness and integrity (ethical), and contributing to
    communities and addressing social issues (philanthropic). Meeting these responsibilities can build trust,
    foster positive relationships, and lead to organizational success.
    Decision - Carroll's approach to business responsibilities appears more effective than Friedman's
    Traditional View. While Friedman focuses on profit maximization, Carroll's model includes economic,
    legal, ethical, and philanthropic responsibilities, providing a more holistic framework. Carroll's approach
    considers societal and environmental factors alongside financial goals, promoting long-term
    sustainability and positive stakeholder relationships. Implementing Carroll's four responsibilities can
    enhance organizational reputation, reduce risks, and drive success in both local and global contexts.

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