Business Analysis: WorldCom Inc.

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Imagine if you would, being a brand new business school graduate and being offered the opportunity to work for one of the largest and most prestigious company in the United States. Not only that, at WorldCom, you may be "granted compensation beyond the company's approval salary and bonus guidelines."(Kaplan & Kiron, p. 3) If you are exceeding more talented, you could be like the CEO who "in addition to his full-time job [...] was managing several unrelated businesses."(Kaplan & Kiron 2007, p. 11) It is fair to say that a majority of job seekers, to say the least, would jump at the opportunity to perform in that role and within that culture of aggressive performance and rewards. After all, being in a reputable organization that has an identifiable culture or "shared values, principles, traditions, and ways of doing things that influenced the way organizational members act," (Robbins & Coulter, 2009, p. 46) while making a comfortable living, would be a dream come true. However, things are not always what they seem once you go beyond the surface. The organizational culture promoted flexibility in shady decision-making and a doing whatever-it-takes attitude towards hitting their Wall Street financial forecast. This very nature of unscrupulousness contributed to the well-known ethical accounting breaches that are forever associated with WorldCom. When you have a culture or a group that rewards employees who do whatever is necessary, regardless of who they hurt, an environment filled with mistrust and immoral practices develops. The ethical boundaries were also blurred and the other "employees [who] knew about or were concerned about fraud were too afraid to report it."(Accountingweb, 2003) Additionally, "employees felt that they di... ... middle of paper ... ...For-Profit Organizations. Retrieved March 20, 2011, from Di Stefano, T. (2005, August 19). WorldCom's Failure: Why Did it Happen? Retrieved March 23, 2011, from http://www.ecommercetimes.com/story/45542.html?wlc=1300920819 Kaplan, R. S., & Kiron, D. (2007). Accounting Fraud at WorldCom. Boston: Harvard Business School Publishing. Maclagan, P. (2007). Hierarchical Control or Individuals’ Moral Autonomy? Addressing a Fundamental Tension in the Management of Business Ethics. , 16(1), 48-61. Niskanen, W. (2002). Enron, WorldCom, and Other Disasters. Retrieved March 23, 2011, from http://www.cato.org/pubs/handbook/hb108/hb108-22.pdf Robbins, S.P., & Coulter, M. (2009). Management (10e ed.). Upper Saddle River, NJ: Pearson Prentice Hall. Sox-Online. (2006). Sarbanes-Oxley Essential Information. Retrieved March 19, 2011, from http://www.sox-online.com/basics.html

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