Q2.

Explain terminal and instrumental values of a dynamic business

firm. How does value system develop in an organization?
Values are the basic convictions that give us a sense of right and wrong, good and
bad. Thus values form the basis of ethical behavioral value system is a set
of consistent ethic values and measures used for the purpose of ethical or
ideological integrity. A hierarchy based on a ranking of an individuals values in
terms of their intensity forms his/her value system. Values are beliefs that affect an
individuals judgmental ideas about what is good or bad. Ethics is the way the
values are acted out. Ethical behavior is acting in ways consistent with ones
personal values and the commonly held values of the organization and society.
Ethics is a set of moral principles or values which is concerned with the
righteousness or wrongness of human behavior and which guides your conduct in
relation to others. Ethics involves learning what is right or wrong, and then doing
the right thing

Terminal Values refer to desirable end-states of existence. These are the goals that
a person would like to achieve during his or her lifetime. These values vary among
different groups of people in different cultures.
The terminal values are:
1. True Friendship
2. Mature Love
3. Self-Respect
4. Happiness
5. Inner Harmony
6. Equality
7. Freedom
8. Pleasure
9. Social Recognition
10.Wisdom
Instrumental Values refer to preferable modes of behavior. These are preferable
modes of behavior, or means of achieving the terminal values.
The Instrumental Values are:
1. Cheerfulness
2. Ambition
3. Love
4. Cleanliness

5. Self-Control
6. Capability
7. Courage
8. Politeness
9. Honesty
10.Imagination
Attributes of Values- There are two attributes of values that can be used to rank
order an individuals values into a hierarchical value system.
1. Content. This is how important the mode of conduct or end-state of existence is
to the individual.
2. Intensity. This is how important this value is in relation to other values.
Values lay the foundation of understanding
Attitudes (what ought & what ought not to be)
Perceptions (Right & Wrong)
Motives
which shape the behavior of individuals. A system of shared values of the
organizational members helps in developing the organizational culture.
Organizational values which are ethical and in the interest of the society enhance
the image of the organization.