Company Overview Of Enron Corporation
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Added on 2019-09-20
Company Overview Of Enron Corporation
Added on 2019-09-20
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Company OverviewThe rise and fall of Enron deal with the collapse of Enron Corporation resulting from the criminal trials for various top executives of the company during their Enron Scandal depicting the involvement of Enron traders in the crisis of California electricity. Enron Corporation was an American commodity, energy, and Services which was based in Houston, Texas. The company employed around 20,000 employees before bankruptcy and was considered as the major natural gas, electricity, pulp and paper companies and communication in the world and has revenues of $111 billion. It was termed as America's Most Innovative Company by Fortune for around six consecutive years.The financial conditions were seen to be sustained substantially in 20012 by the systemic, institutionalised and creatively planned accounting fraud was terming the organization as Enron Scandal. Since then the company is a well-known name in the cased with corruption and willful corporate fraud. The accounting practices and related activities were brought into questions in the whole United States. The scandal by Enron was seen to affect the greater business which caused a dissolution in the Arthur Andersen accounting company. During late 2001, a bankruptcy protection was filed by Enron in the Southern District of New York and selected Manges, Gotshal and Weil as their bankruptcy counsel. During 2004, the organization ended in bankruptcy and is considered as the most complex bankruptcy cases in U.S. history (Gibney, A., 2005).The paper discusses the success and failure of organizations using the three theories/ models which are:
Competing Values FrameworkMintzberg management modelandTrait and Transformational Theories of LeadershipDiscussionVarious management theories related to the organization help in offering a lens by which the organizations and managers of the organization can be viewed. These theories help in reflecting a perspective on the management and the organization and help in mobilizing the arguments, ideas and explanations for making sense of practice along with influencing the practices. A framework is provided using the theories for analyzing the strengths and weakness of the managerial system. Therefore the case of rising and fall of Enron Corporations has been discussed by using the three management theories.The Competing Values Framework (Goodman, E.A., Zammuto, R.F. and Gifford, B.D., 2001) along with the management model by Mintzberg’s (1976) are highly valuable at examining the failures and success of the organizational culture. The CVF model depicts four quadrants namely, control, compete, create and collaborate. This model has integrated various managementmodels and assists the organization and their managers in order to balance the managerial concepts like efficient activities versus innovation and change in an organization, stability, and control versus flexibility and adaptability; respecting the employee versus setting the objectives and goals. Both the models will emphasize on the skills required by the management. However, the Mintzberg's model will focus entirely on the roles of managers and their need for action in the internal and external planes and CVF focuses on integrating the competing skills and values for developing a balanced individual approach.
Each model was applied to the Enron corporations to seek unique vintage ideas that highlight various strengths and weaknesses. A wide range of skills for the managers was selected from the given models like encouraging compliance, leading teams, managing oneself and others, scheduling and leading the unit or the organization and compared with the skills of management of Enron Corporation. The model of management by Mintzberg focuses primarily on managing the places and position in the organization and the roles and sub-roles played by a manager. The model is highly prescriptive, detailed and action-orientated in nature. On applying the model to the managers and staff of Enron Corporation, it can be suggested that the managers were highly excelled at competencies like project managing, negotiating, managing change, firefighting, and politicking. This lead to the achievement of commendable success of the corporation in a short span of time.Through the Competing Values Framework, it was suggested that the managers of Enron were not rated highly on the basis of their ability to communicate honestly and clearly as they were seen to withheld information and data from their workers and staff thereby neglecting the essence of communication as the true states of the organization. These skills were not even adapted in the hour of crisis and on the eve of bankruptcy. Although the managers were good andeffective communicators when it came explaining the goals and objectives of business. In spite of wielding their power in an effective manner while making profits, the managers and staff wereseen to lack the ability to use power ethically and ended up using their authority and power for retaliation in the crisis time. This explains the abrupt fall of the organization even after attaining the highest position in the market. Both the models are seen to present convergence between the competencies explained by each one of the models. Both the models help in offering the different perspective and explain the
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