Enron's Organizational Failure

Enron’s Organizational Failure Aretha Gonzalez University of Phoenix LDR 531 Elliot Ser, PhD. 8/16/2009 Enron’s Organizational Failure Enron’s organizational rule as well as its creative accounting and temporary leadership lead to one of the biggest corporate scandals in advertise (docstoc.com, 2008). To understand how such a promising and diverse alinement was lead into bankruptcy, one has to understand the effect upper direction’s direction and terminations played into the gild’s downfall. In 1985, InterNorth merged with Houston Natural Gas to formEnron. By 1989, Enron began trading in natural gas commodities. Chief Executive Officer Kenneth address was in charge. By December 2000, Lay was the Chair profane concern of Enron and Jeffrey Skilling took everywhere as Chief Executive Officer. Skilling contain his position until he resigned in August 2001 (Corportaenarc.com, 2009). Whereas, Lay returns as CEO. The corpo rate structuring of Enron do such corporate musical chairs possible. decentralization was the key construction Enron used to operate. Emphasis was placed on flexibility and creative thinking not accountability and restrict (docstoc.com, 2008). According to Mintzberg, decentralization is the sprinkling of power among many individuals inside an organization.

Due to Enron’s dissimilar units, all the information involve to operate the company could not be comprehended by the CEO. Therefore, division heads had a broad deal of autonomy. However, the CEO and president of Enron still should have been sure of m ajor decisions which affected the company (M! intzberg, 2003). One such decision which had far-reaching consequences for Enron was made by Jeffrey Skilling in 2001. On February 12, 2001, Skilling became CEO of Enron and received $132 million dollars for the year. Skilling, who was known as an arrogant and brash man by associates, adopted the rehearse of adopting mark to market accounting. This is tabulating expect profits...If you want to get a full essay, order it on our website: OrderCustomPaper.com

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