How Cronyism is Analogous to being an [Organ]izational Cancer.
Employee Favoritism is synonymous to a plague within the organization, and for most established companies, it is a violation of the organization's Code of Business Conduct. Such unethical acts giving preferential treatment to less-qualified employees essentially creates a morale Cancer within the department. It is considered cancer because it causes the sickness of the workplace environment and slowly erodes the competitive position of a company or at worst - literally destroys the potential of companies.
Cronyism Will Jeopardize Organizational Success
Cronyism is the other side of nepotism. It is the act of hiring friends regardless of qualifications. One of the main problems with cronyism is the feeling of entitlement that employees hired under these circumstances feel. Because of their close relationship to the top executive, they feel they deserve raises and promotions that should be reserved for more qualified staff members. Besides feeling of entitlement, these groups feel powerful and can influence other people in the organization and top executive. These groups are feared by other group and may create conflict in the workplace and can result in losing qualified personnel.
When a supervisor continually favors one or a few employees over the others, he or she may be missing out on the talents and skills the others bring to the table. This can lead to promoting someone who is not ready for more responsibilities over someone who is ready and able to take on a challenge.
There is a general sense of unfairness when employees perceive that there is favoritism in the way in which they are treated by management. This brings down company morale because favoritism leads employees to believe that no matter what they do, their efforts won’t be rewarded if they are not one of the favored few.
Favoritism can cause employees to begin to resent the supervisor who is unfairly favoring employees who may not be the most deserving, as well as resent the favored employees who are taking advantage of the situation.
If the resentment reaches a certain point, the company may be at risk of losing some potentially excellent employees who won’t want to stick around where they’re not appreciated.
With a decline in morale, growing resentment, and overlooked potential, a supervisor who unfairly favors one group of employees is also hurting the company overall by stunting the growth that would come from moving the best employees forward to management positions. This also is a consequence of losing employees who may have been of great value.
1. Decline company performance
When the employees are hired because of family relationship, friendship and not because of certain skill qualifications and then not being able to perform the job, then nepotism becomes counter-productive. And if the executive staff begins hiring family members because they need jobs, not because of their qualifications and ability, and then such practices can affect the company's profitability or performance. Therefore, the top management should consider skill qualifications in hiring and not favoritism.
2. Resentment and demoralization.
Favoritism is not going to rest well with other employees. One of the primary effects of workplace favoritism on employees is resentment. Workers feel that, no matter how hard they work, it won’t matter because preferred employees will always get better benefits, more attention and greater opportunities. Such situation can demotivate other employees to do their job to the best they can. They feel not recognized and appreciated. They feel bad and discouraged. Not only that, employees often resent the special worker, treating her with unkindness and gossiping about reasons for preferential treatment. Workers also resent their employer, becoming less willing to participate actively in the company mission. If employees feel that they’re being passed over for new responsibilities or promotions because all goodies are funneled toward favorite workers, lower motivation results. Employees slack off, taking less care with assigned duties and being more reluctant to volunteer for additional tasks. This results in lower productivity, missed deadlines and lower overall morale.
3. Organizational Conflict
When employees perceive the favoritism to be widespread, such situation may lead to organizational conflict. It would not only be conflict between other employees and favored employees but also with the executive or management and employees. If such situation happens, then working environment becoming not conducive for other people to work. The situation may lead to some employees take legal action against employers who engage in egregious favoritism, citing preferential treatment based on gender or ethnicity. If workplace favoritism is widespread, for example, an employer offers preferential treatment to workers based on sexual favors, employees could cite a hostile work environment. This can lead to serious repercussions, including court fees, restitution awards and loss of professional reputation.