Bernie Ebbers
A Review of Bernie Ebbers and His Leadership
Bernie Ebbers had an amazing rise to power followed by a catastrophic fall. Early in his rise many saw him as a great leader. TIME magazine described Bernie during that time as “It was Ebbers who gave LDDS its mojo --and a mission to democratize U.S. long-distance service. ” (Padgett & Jackson, 2002). His charism and aggressive business made him a leader that many wanted to follow. Eventually he was seen very differently, during his trial one writer said “Ebbers was portrayed as one helluva lousy leader, distrusting of employees and micromanaging ridiculous details.” (FCS, 2005). Here we will review some of the positive and negative aspects of his leadership.
Discussion
Bernie Ebbers first big business opportunity came with the breakup of the telephone companies and his part in creating the telecom company LDDS (Trevino & Brown, 2005, p. 90). It was during that time that people saw the charismatic leader that they wanted to follow, Trevino and …show more content…
Brown noted that he had a “maverick image as an industry outsider in cowboy boots leading his troops to the top of the mountain” (2005, p. 89). Often employees are not only seeking good leader, but sometimes they are seeking change and someone from the outside who is going to shake things up looks like a good thing. Ebbers filled that role and many people were probably excited by his new ideologies for the growth of the company and how he continually pushed it forward. By setting a defined business plan of growth and pushing his people to achieve it he showed that not only did he have charisma, but he was also leading the company to achieve their goals. However soon people realized the dichotomy of their leader. To the public he seemed to be a very good, open and generous person, but within his own company he seemed to be taking cost reductions to extreme levels in daily operations while encouraging executives to take loans from him to buy company stock and he was consolidating power to just a few executives (Trevino & Brown, 2005, pp. 90–93). These actions are not inherently wrong, but they probably set the foundations for the problems to follow.
Ebbers had now set two key standards, the first that power and control is fully centered at the top of the organization (and carried out with a heavy hand) and the second is the dichotomy of his personal and business behaviors.
So should we expect the same behavior from the rest of the employees, according to Trevino and Brown we should because “If leaders are observed “cooking the books,” enriching themselves at the expense of others, or lying to customers or suppliers, followers learn that such behavior is expected.” (2005, p. 72). Probably without knowing it Ebbers was setting the example for the rest of the company to act the same way, hold onto the power, micromanage and don’t worry if our personal ethics and your business ethics are different. In the after math of the WorldCom collapse reports showed that the accounting fraud occurred at the executive level and was clearly allowed by and caused by the culture that Ebbers had created in the staff (Ackman, 2003)
.
Conclusions
The leadership of the company probably had difficulties working in an ethical manner because they knew what results were expected because success was expected, no matter what the cost. From that viewpoint it is clear that his leadership influenced people to do the wrong thing. Not everything was done in an unethical manner in the business, but it was likely clear that the boundaries could be pushed at any time if needed to achieve a goal. If he had built teams on trust, inclusion, teamwork and appropriate accountability he may have been able create a sustainable business that would not collapse under the weight of its own ethical mistakes.
Bernie Ebbers had an amazing rise to power followed by a catastrophic fall. Early in his rise many saw him as a great leader. TIME magazine described Bernie during that time as “It was Ebbers who gave LDDS its mojo --and a mission to democratize U.S. long-distance service. ” (Padgett & Jackson, 2002). His charism and aggressive business made him a leader that many wanted to follow. Eventually he was seen very differently, during his trial one writer said “Ebbers was portrayed as one helluva lousy leader, distrusting of employees and micromanaging ridiculous details.” (FCS, 2005). Here we will review some of the positive and negative aspects of his leadership.
Discussion
Bernie Ebbers first big business opportunity came with the breakup of the telephone companies and his part in creating the telecom company LDDS (Trevino & Brown, 2005, p. 90). It was during that time that people saw the charismatic leader that they wanted to follow, Trevino and …show more content…
Brown noted that he had a “maverick image as an industry outsider in cowboy boots leading his troops to the top of the mountain” (2005, p. 89). Often employees are not only seeking good leader, but sometimes they are seeking change and someone from the outside who is going to shake things up looks like a good thing. Ebbers filled that role and many people were probably excited by his new ideologies for the growth of the company and how he continually pushed it forward. By setting a defined business plan of growth and pushing his people to achieve it he showed that not only did he have charisma, but he was also leading the company to achieve their goals. However soon people realized the dichotomy of their leader. To the public he seemed to be a very good, open and generous person, but within his own company he seemed to be taking cost reductions to extreme levels in daily operations while encouraging executives to take loans from him to buy company stock and he was consolidating power to just a few executives (Trevino & Brown, 2005, pp. 90–93). These actions are not inherently wrong, but they probably set the foundations for the problems to follow.
Ebbers had now set two key standards, the first that power and control is fully centered at the top of the organization (and carried out with a heavy hand) and the second is the dichotomy of his personal and business behaviors.
So should we expect the same behavior from the rest of the employees, according to Trevino and Brown we should because “If leaders are observed “cooking the books,” enriching themselves at the expense of others, or lying to customers or suppliers, followers learn that such behavior is expected.” (2005, p. 72). Probably without knowing it Ebbers was setting the example for the rest of the company to act the same way, hold onto the power, micromanage and don’t worry if our personal ethics and your business ethics are different. In the after math of the WorldCom collapse reports showed that the accounting fraud occurred at the executive level and was clearly allowed by and caused by the culture that Ebbers had created in the staff (Ackman, 2003)
.
Conclusions
The leadership of the company probably had difficulties working in an ethical manner because they knew what results were expected because success was expected, no matter what the cost. From that viewpoint it is clear that his leadership influenced people to do the wrong thing. Not everything was done in an unethical manner in the business, but it was likely clear that the boundaries could be pushed at any time if needed to achieve a goal. If he had built teams on trust, inclusion, teamwork and appropriate accountability he may have been able create a sustainable business that would not collapse under the weight of its own ethical mistakes.