MGMT20001 Final: MGMT20001 Exam Notes - Enron Case Study

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copperspider388

7 Jun 2018

School

University of Melbourne

Department

Management

Course

MGMT20001

Professor

Victoria Roberts

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ENRON

Culture:

Identifyaculture:

ObservablesymbolsPhysicallayoutEnrontradersalllookedverysimilargoatee,cleancut

outdoorsylook,allwearblueshirt,samelanguage.

CommunicationpatternsLaywasdescribedasa‘revolutionary’whileSkillingwasknownas

DarthVadermasteroftheenergyuniverse.Luredovertothe‘darkside’.Similarnicknames

wereproudlyadoptedbyotherexecutives.‘Enronians’,‘waterwalkers’

Stories‘MarktheShark’engagedinmajorspectacles,usingtheatricalcostumesandsettings.

Skillingevendressedforthepartatsomecompanygatherings,referringtohistradersas‘storm

troopers’

Practicesandbehavioursgruellingrecruitmentprocess,highlevelsofworkintensity,

ranking/’rankandyank’system.

Values,beliefs,assumptions,feelingsUnderlyingvalueofchange‘laboratoryforinnovation’.

Internalculture:unwrittenruleof‘nobadnews’.fierce,competitiveculturecutthroat.



Integrationisttheoryofculture:uniformculture,commonsetofvaluestoenableorganisation’s

memberstoworktogetherreducesneedforformalrules.Consensusonexternal

(environment,specificgoals,howtoaccomplishgoals,howtomeasuringresults)andinternal

adaptation(commonlanguage,corevalues,boundaries,criteriaforrelationships).Patternsare

easytolookfor,canbemanagedtopdown,somesuccessfulcompanieshavestrongcultures,

HOWEVER:patternswillnotalwaystellthewholestory,noevidenceforrelationshipb/wculture

andperformance,strongculturesmaynoteasilychange,canbedysfunctional.



DifferentiationisttheoryofCulture:‘I’dratherhearthenewsfrommymanageranyhow’...a

clusterofsubculturesrelatedtoaparticularchallenge,task…consensusfoundinsubcultures.

RelationsbetweenSCsmaybecomplementary,conflictingorindependent.middlemanagers

shouldmanageculture.emphasizescommitmenttotheworkgroup,moremeaningfultothe

individual,allowsformiddlemanagerstomanageculture.HOWEVER,nowclearhowdifferent

subculturesaremeanttofittogether.Conflictsamongsubcultures.

Power&Politics:

Thefirstdimensionofpower:MobilisingRESOURCEStoDEFEATconflict:

ReferentpowerEnronemployeeshadunquestioningfaithinbothleaders,whowere

surroundedbyanauraofcharisma.Didnotquestionauthority.

Authoritypower/rewardpowerEmployeeswererankedC’sweretoldtoshapeuporshipout

‘rankandyank’systemsmeantthat15%ofemployeeswereregularlyfiredorquit.Top

performersrewardsofhighcashbonusesandstockoptiongrants.Employeeswerenot

encouragedtocommunicateupwardsandcertainlynotintheformofnegativeinformation

criticismofthecompanywasnottolerated.Anyonewhoqueriesaccountancypracticeswas

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MGMT20001 Final: MGMT20001 Exam Notes - Enron Case Study

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