Enron: The Smartest Guys In The Room
Viewing this documentary, provides a look at what can happen when an organizations culture is not based on values, but on productivity alone (Ferrell, Fraedrich, & Ferrell, 2013). Leaders of the organization set the tone for the entire company, and in this case, many of the stakeholders, as well (Enron: The Smartest Guys in the Room, 2005).
Sometimes, examples of what does not work, is an excellent way to understand more clearly why something does work. Insight into Enron provides just such an example. Top management it clear that the only important aspect was to make money and continually grow the stock prices (Enron: The Smartest Guys in the Room, 2005). Even though several employees questioned, if even in their own minds, the methods that were being employed, the corporate culture …show more content…
In fact, asking too many questions, was met with harsh criticism, and anyone not meeting their financial goals were fired. A strong ethical culture, with the appropriately aligned decisions, would never have ignored the importance of caring for its’ stakeholders and the community. This exacting culture certainly produced rapid results and high financial return, in the short term, but without the values based core, it was not sustainable. By rewarding unethical behavior, Enron was able to get numerous employees, suppliers and investors to “drink the Kool-Aid”, if you will. Studies have shown that when people are confronted with unethical behavior, it is likely they will make unethical decisions, rather than their values having a positive effect on the unethical group. Consequently, it is imperative that upper management develop, embrace, train, communicate and monitor an ethical program that will guide the entire organization in making ethical decisions. Interestingly enough, certain character traits of people in the upper echelon of the company, can help to identify where problems may arise. As with Jeff
Sometimes, examples of what does not work, is an excellent way to understand more clearly why something does work. Insight into Enron provides just such an example. Top management it clear that the only important aspect was to make money and continually grow the stock prices (Enron: The Smartest Guys in the Room, 2005). Even though several employees questioned, if even in their own minds, the methods that were being employed, the corporate culture …show more content…
In fact, asking too many questions, was met with harsh criticism, and anyone not meeting their financial goals were fired. A strong ethical culture, with the appropriately aligned decisions, would never have ignored the importance of caring for its’ stakeholders and the community. This exacting culture certainly produced rapid results and high financial return, in the short term, but without the values based core, it was not sustainable. By rewarding unethical behavior, Enron was able to get numerous employees, suppliers and investors to “drink the Kool-Aid”, if you will. Studies have shown that when people are confronted with unethical behavior, it is likely they will make unethical decisions, rather than their values having a positive effect on the unethical group. Consequently, it is imperative that upper management develop, embrace, train, communicate and monitor an ethical program that will guide the entire organization in making ethical decisions. Interestingly enough, certain character traits of people in the upper echelon of the company, can help to identify where problems may arise. As with Jeff