In my sixth post of this series, Cost Benefit Analysis Net Effect, we were provided with an overall final view of the analysis. However, we were left to wonder what the implications might be. I hope to cover that issue with this post.
To this point, we have defined the cost-benefit analysis, learned how government initiatives were the main driver in the proliferation and standardization of the tool, reviewed the inherent pros and cons, and witnessed the logical distortions that can and do occur by using the analysis in practice.
Indeed, most discussion regarding cost-benefit analysis involves the government use for decision-making, decision-justifying, and as a tool for regulation (or deregulation, for that matter). But what happens when this debatable tool replaces, in part or whole, the individual decision making process at entrepreneurial institutions?
Granted, some firms do have to place value on moral commitments, but most do not. Most use this analysis to justify, in the realm of their stakeholders, major decisions on firm direction or actions, or to assist employees in making firm beneficial practical, everyday decisions.
Almost without exception, these justifications will appear to be logical and coherent. And an overwhelming percentage of the time, they will be legal – or later found to be legal. The daily question we face as decision-makers or implementers is whether this justification is ethical and/or moral. To ignore this question, is to ignore the context of the original question being posed.
In the financial, medical, non-profit and education industries especially, the integrity of ethics and morality are key considerations – not to be taken lightly. Rarely, however, is the line in the sand actually drawn as to what this integrity actually consists of in these fields. Integrity then typically defaults to where a single individual’s, or a group of individuals collective, values lay. To that end, consider:
Where do your values as a leader lay? What happens if your values are not in congruence with the current/local laws? What if your values are not in line with your company’s? What happens when laws are not logical and coherent? What happens when values you disagree with influence logic and laws? Can this puzzle ever produce a successful result?
What would happen if this author removed his own integrity to his own values and analyzed my efforts on this document as follows?
Benefit = millions of copies distributed x $0 price = $0
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Opportunity Cost = 80 hours x $500 billing per hour = $40,000