Download Behaving Badly: Enron`s Excessive Corporate Culture

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Corporate Mismanagement and Unethical Behavior at Enron
Instructor Discussion Notes
Discussion Notes
Answers will vary. Enron whistle-blowers would have had an easier time in an
adaptive organization culture where management values individuals—customers,
shareholders, and employees alike. In an adaptive organizational culture,
managers would have been open to changing processes within the company that
would have made it easier for employees to report wrongdoing. Employees who
tried to come forward were either ignored or harassed because the culture was
nonadaptive, with management protecting itself at the expense of others,
including employees and shareholders.
Enron’s espoused values—what the organization said it valued—were respect,
integrity, communication, and excellence. Its enacted values—the way the
organization actually behaved—appear to have been greed, deceit, and misleading
its employees, investors, and customers with off-the-books financial reporting.
Leaders create or strengthen the corporate culture by how they behave, what they
deem important, how they reward people, how they deal with employees, and
how they respond to crises. The behavior of Enron’s top leaders modeled a culture
of greed and focus on self—what’s in my best interest instead of what’s in the
best interest of the organization. They focused on covering up facts with off-thebooks reporting instead of providing employees and investors with a clear, honest
look at the company’s performance. They rewarded themselves—walking away
with millions in assets—at the expense of their employees and investors, many of
whom were financially devastated by the company’s bankruptcy.