The paper “ Enron Corporation - How Executives Develop a Reputation for Ethical Leadership” is an outstanding example of a case study on management. Leadership is defined as the ability of the superiors in an organization or society to control the subordinates. Leaders are people who have influence and control the behavior of their subordinates in the organization. Leaders, therefore, can control their subordinates to a course of action the want them to follow. The purpose of this report is to explore and clearly explain what happened in the Enron and related it to leadership theories and concepts learned in class.
The report therefore critically analyzes all the occurrences that took place at Enron. This case study aims at relating the leadership theories and concepts to the happenings at Enron. Findings will be explained and used to make conclusions. Necessary recommendations will also be indicated at the end of the case study (Sarros and Santora, 2001 p. 245). The field of research here is Enron. Enron Corporation was an American commodity, energy, and services company. The company was based in Houston, Texas. Enron Corporation was among one of the most notable companies in the world.
It was popular in its production of natural gas, electricity, and other services. The commodities, energy, and services that the company offered created an enormous number of job opportunities. Statistics and records reveal that the company employed around 20,000 staff in the business. However, the company due to various reasons that this case study will highlight ceased operation on the 2nd of December 2001 (Sinha, 2008 p. 15). There are several issues and findings that the case study has analyzed in detail.
Major questions that affected Enron Corporation include poor leadership, bankruptcy, and discrimination of employees, corruption, and lack of integrity. Most of the transactions that were conducted were unfair and dubious. The theory that will be used is participative leadership. Participative leadership theory is based on the following assumptions: a. Involvement in decision‐making improves the understanding of the issues involved by those who must carry out the decisions. b.There is more commitment to decisionsc. Joint goals and objectives attract more collaborationd. When people make decisions together, the social commitment to one another is greater and thus increases their commitment to the decision. e.
Better decisions are made by many people FindingsNumerous problems have been found in the case study. These problems are all that contributed to the fall of Enron Corporation. One of the major issues in the Enron Corporation is the lack of proper rules, regulations, and laws. The company had no standards and regulations governing duties and responsibilities for all the staff in the organization. Part of the Enron story reveals the following information: “ The rules in California are terrible'', but then once you see what the rules are, you guys push those rules to the edge in an effort to make a buck” .
From the above information, it is clear that not set rules and policies were established to govern the employees. Even leaders should be governed by rules and regulations of the company. The second problem in the case study is corruption. The Enron story reveals a lot of information that gives a clear indication that the company had a lot of instances of fraud. Superb evidence of corruption from the Enron story is indicated below.
It is stated that: “ One example of unethical practices was the transfer of energy out of California to create blackouts thus raising the price of electricity. " The transfer of power to California to create blackouts was a very unethical practice. Such practices amount to the corruption that leads to bankruptcy and hence falls of the company (Brown and Trevino, 2006 p. 598).