Leadership Effect on Organisations Culture and Ethics

Background:

In the Module 5 Case, you will be performing a critical analysis of the role assumed by an organization's culture in determining the organization's ethics.  You may complete the Module 5 Case and SLP in any order you prefer.

Required Reading:

Please read the following articles related to Enron:

Madsen, S. & Vance, C. (2009). Unlearned lessons from the past: an insider's view of Enron's downfall. Corporate Governance,9(2), 216-227. Retrieved from ProQuest.  

Free, C., Macintosh, N., & Stein, M. (2007). Management Controls: The Organizational Fraud Triangle of Leadership, Culture and Control in Enron. Ivey Business Journal Online. Retrieved from ProQuest.

Meisinger, S. R. (2012). Examining organizational ethics. Human Resource Executive Online (June, 2011). Retrieved on November 19, 2012 from: http://www(dot)hreonline(dot)com/HRE/story.jsp?storyId=533348507

Assignment:

In a well-written, 5-7 page essay, please address the following:

Discuss the ways in which a company's leadership and culture influence its business ethics.

Keys to the Assignment:  

• Define "organizational culture." Please be very specific (and be sure that you provide references for your description of culture). 
• Evaluate Enron's sense of business ethics and business operations in the context of the organization’s culture? Specifically, what went wrong?
• What should have been the role and responsibility of company leadership (the Board of Directors, the CEO Ken Lay and others)? In what ways did key executive players (e.g., Lay, Skilling, and Fastow) work to negatively reshape the culture, and with what adverse consequences?
• How might Human Resource Management (HRM) have played a central role in setting the "moral compass" at Enron, helping to form and shape the organizational culture (perhaps avoiding the Enron debacle altogether)?

Assignment Expectations:

Your paper will be evaluated on the following seven criteria:

• Precision - Does the paper address the question(s) or task(s)? 
• Breadth - Is the full breadth of the subject (i.e., the Keys to the Assignment) addressed?  
• Depth - Does the paper address the topic in sufficient depth and include the background reading and other background resources as references? 
• Critical thinking - Is the subject thought about critically (i.e., accurately, logically, relevantly, and precisely)?
• Clarity - Is the writing clear and are the concepts articulated properly? Are paraphrasing and synthesis of concepts the primary means of responding to the questions or are points conveyed through excessive use of quotations? 
• Organization - Is the paper well written?  Are the grammar, spelling, and vocabulary appropriate for graduate-level work?  Are headings included in all papers longer than two pages? 
• Referencing (citations and references) - Does the paper include citations and quotation marks where appropriate?  Are the references from the background reading and assignment present and properly cited?  Are all the references listed in the bibliography present and referred to via citation? 

Tips and Suggestions:

1) For this final Case essay, use at least four additional scholarly sources.

2) Cite all sources using proper APA style, and use proper in-text citations.

3) Follow the Well-Written Paper guidelines.

4) An excellent article on Enron's culture as well, the following may also be useful to you in your analysis of the Case:

Sims, R. R. & Brinkmann. J. (2003). Enron ethics (or: Culture matters more than codes). Journal of Business Ethics,45(3), 243-256. Retrieved from ProQuest.

5) Finally, I highly recommend the movie Enron: The Smartest Guys in the Room. You may be able to view parts of the movie on YouTube. Following is the movie trailer: http://www(dot)youtube(dot)com/watch?v=0zMakN-EMLg

MANAGEMENT CONTROLS: THE ORGANIZATIONAL FRAUD TRIANGLEOF LEADERSHIP, CULTURE AND CONTROL IN ENRON

by Clinton Free; Norman Macintosh; Mitchell Stein

Content Type

Journal Article

Abstract

This article draws on a vast database of public records, testimonies at the various Enron-related trials and insider accounts concerning Enron's rise and fall to answer the question: how did a sophisticated and comprehensive set of management controls fail to prevent and detect widespread and continued corporate-wide fraud, information manipulation and dishonesty. This article focuses on the cultural environment surrounding Enron's management control systems, and the influence of a powerful-risk taking culture on Enron's controls. Enron offers a number of important insights for managers. Firstly, it underlines the vital role of top management leadership in fostering organizational culture. Secondly, within organizations, the impact of culture and leadership on even most the sophisticated management control system must not be overlooked or minimized. Finally, the Enron saga speaks to the importance of not abandoning professional integrity.

Publication Title

Ivey Business Journal Online

Publisher

University of Western Ontario

Date

07/2007

Start Pag

Unlearned lessons from the past: an insider's view of Enron's downfall

by Madsen, Susan and Vance, Charles

Content Type

Journal Article

Abstract

Purpose - The purpose of this paper is to capture an insider's view of the organizational culture and management practices that contributed to the downfall of Enron. In light of the current worldwide financial and economic crisis, this article aims to highlight some of the unlearned lessons from the past. Design/methodology/approach - A qualitative interview case study was used for the basis of this paper. Findings - This article shares an insider's (former vice president's) insights related to the practices and culture that led to Enron's unethical decisions and strategies. It discusses one man's view of the history of Enron, as well as what should have been learned and applied to the global financial industry to help to minimize or even avoid today's painful economic crisis. Practical implications - Six main causes of unethical behavior for individuals in organizations are outlined, and important lessons learned are presented. The article also discusses the importance of reflecting and remaining inwardly vigilant, while outwardly thinking of and serving others. Originality/value - The information for this article was based upon an original interview.

Publication Title

Corporate Governance

Publisher

Emerald Group Publishing, Limited

Date

2009

Volume

9

Issue

2

Pages

216 - 227

ISSN

1472-0701