Management and Enron Employees free essay sample

Another organizational behavior theory that Enron failed to portray was the contingency theory. Contingency theory views conflict as inescapable but manageable. This theory suggests that effectiveness should be a manager’s function in order to adapt to environmental changes. â€Å"Company officials used secret investments and tricky math to make Enron appear stronger that it was† (Bauman, 2002). Enron management abused this theory. The insiders, who knew the truth, sold their stock when the price was high and made millions of dollars. The employees were not so fortunate. The employees stock, which was mainly invested in their 401(k) retirement plan, became worthless when the stock market of Enron crashed. The organizational behavior of Enron was misleading and unethical. â€Å" Organizational behavior is a field of study that investigates the impact that individuals, groups, and structure have on behavior within organizations for the purpose of applying such knowledge toward improving an organizations effectiveness† (Judge, Robbins, 2007). We will write a custom essay sample on Management and Enron Employees or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page The management of Enron never communicated the truth to their employees or the people of the public. They were only looking out for themselves and not the company or the employees. Their organizational behavior was unethical and didn’t do anything to improve the company, only their wallets. The company was growing at a fast rate and it began to borrow money to invest in new projects to keep up. They created partnerships, which allowed them to keep $600 million in debt off the books and kept the government, investors, and employees in the dark. This unethical organizational behavior would soon catch up to management. In October of 2001, Enron announced a loss of $638 million, which they could not pay off. Tragically, it resulted to be the largest company, in the United States, to ever go bankrupt. Managers are concerned about order, performance, and getting things done. While, leaders tend to be more flexible and care about the people and their needs. Enron did not endure great manager skills or leadership qualities. Management within this company operated in an unethical behavior. As a leadership role, this company did not protect their employees and did not protect their best interests. Therefore, Enron’s ineffectiveness as a manager and a leader led to the failure as a company. The organizational structure formed around the accounting system failed to provide a clear picture of Enron’s true condition (Jickling, 2002). The company’s collapse and failure was also based on the independent auditors and board of members who were unwilling to challenge Enron’s management team. Wall street stock analysts and band raters some how missed the signs, the rules governing employer stock in company pension plans, and the unregulated energy derivatives trading that was the core of Enron’s business (Jickling, 2002).