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White Collar Crimes: Using Sources of Power Ethically

Leadership Challenge: Using Sources of Power Ethically

The CEO of a large company has retained you as a management consultant to look into an area of concern that she has. With all of the recent corporate scandals like Enron, WorldCom, Tyco, and ImClone, she is wondering how she can avoid these sorts of problems within her company. She has asked you to research and prepare a report that summarizes the various kinds of power she has at her disposal and how this power could be effectively utilized to avoid these sorts of problems within her own company.

There are a myriad of leadership models, most of which discuss sources of power. Using the model presented in your text and accessing other sources as supporting material, list and explain the sources of power that the CEO of a large company typically has at her disposal.

Describe how these powers can be used to avoid the various operational, administrative, and ethical problems experienced by companies. Please respond to this question by identifying three specific business problems that can be addressed through the use of "influence tactics." For each specific problem, describe the influence tactic that should be used, the source of power behind that influence tactic, and why you believe that this influence tactic will effectively address that problem.

Use the Library or other Web resources to support your argument. Be sure to cite your sources using APA Style 5th edition guidelines.

Explain the role of individual differences and traits in leadership.
Apply ethical reasoning skills and ethical theories to business situations.
Recognize situations that present potential legal and ethical issues and develop solutions for those issues.
Apply critical thinking skills to analyze business situations.

Solution Preview

Apply ethical reasoning skills and ethical theories to business situations.

The Greek word "Ethos" is the origin of the word Ethics. The meaning of the word is Character. Knowing this, those who have ethics have character and those who do not ethics do not have any character. Society has recently seen how businesses practice with little or no ethics at all.

Sources of Professional Ethics Examples and How They Impact Career Success - When a company's employees follow the code of ethics, the employees generally ensure that all statements, communications and representations are accurate and truthful; they do not disrespect the company at corporate events or when with a client on behalf of the company; they do not use or divulgence of confidential information by an employee for the profit or other benefit of any part other than the company itself is a violation; and they do not discriminate due to race, color, religion, age or disability. These ethics are the backbone of the majority of businesses. While many businesses and employees today appear to be unethical, the majority of today's employees and businesses are the ones that follow the ethical guidelines and the ones that do not make it to the news. Those who follow ethical guidelines have character. When character is apparent, the individual will succeed. When deception is apparent, the individual will succeed then falter, as deception can only hide for so long.

Recognize situations that present potential legal and ethical issues and develop solutions for those issues.

Specific Examples of Ethical Violations - One of the most recent and most publicized examples of unethical behavior in a business is ENRON. This company filed falsified financials leading the employees, shareholders and potential investors and creditors to believe the company was financially stable when it was not. The auditing firm, Arthur Andersen, put its reputation on the line and certified the falsified financials and after an employee leak, the situation spiraled. Employees lost their jobs and their retirement 401Ks, Stock plummeted and creditors lost millions in bad debt. The severity of this situation produced the Sarbanes-Oxley Act. This Act now protects employees, investors and the world from faulty financial filings in the hope to prevent another ENRON.

AIG, the insurance giant is our second focus of unethical behavior. "The bonuses granted to American International Group officials have become a lightning rod for public anger over the past and present excesses of executives in the financial industry. They also have energized the debate over whether the $170 billion federal bailout of the insurance giant has been effective or defensible. New York Attorney General Andrew Cuomo ...