Ethics

There are critical leadership virtues that leaders should posses so as to be effective in their leadership roles, failure in leadership caused Enron to fall, had it embraced good leadership the mistakes that cost it dearly would have been thwarted.

Leadership involves organizing people or an organization in a manner that is aimed at achieving the goals of that particular organization. Not just anybody can be a leader, because one has to have some special qualities to be able to carry out this task effectively and efficiently. This is especially true in the case of corporate organizations with evidence of several organizations being declared bankrupt or closing down due to poor management practices. It is therefore important to note that leadership qualities and management qualities are two different things though they are related to an extent. Leadership qualities constitute of the skills and values that enhance ones ability to organize and run the activities of a group that are inborn.

These are personal qualities that change only after a long period of time, and can never be taught. Management skills on the other hand are able to be taught to individuals and they comprise of certain specific aspects of the practice. Due to the fact that they can be taught they are easy to acquire over a short period of time. One of the challenges that managers in todays corporate world face include managing complexity. To be a successful leader in the corporate world, there are a couple of leadership and management qualities that one has to posses. These qualities are what will define the level of management within an organization and will also determine the success or the failure of the organization being managed. In Aristotles code of ethics of leaders, he states that it is hard to be a good leader. He further talks of doing the right thing, to the right person, at the right time, to the right extent, with the right tight motive and in the right way is not always right for everyone nor is always easy.

Managers believe that competencies comprises of the abilities and skills that they practice in their daily responsibilities, the understanding, knowledge and experience that aid them in their decisions and the personal values  attitudes that they posses. These components assist in understanding the manner in which a manager works and acts in order to implement corporate responsibilities in decision making. Incompetence can either be conscious or unconscious. There are thus four different stages that lead to incompetence. The first one being unconscious incompetence where at this level, a person has no idea on how to do something, nor is he  she unaware that they cannot undertake a particular skill. Thus without knowing that they are defunct in a certain area, they are more likely to deny the importance of that skill that they lack in that particular area that they are dealing with. There is also the conscious incompetence where an individual does not know how to do something due to the inability to perform a certain skill and he  she recognizes the fact and so is aware that in order to improve his  her effectiveness in this area, they need to improve their skills (Miner 56). There is also conscious competence where the individual progresses to this stage after having acquired the relevant skill that is required, but then, practicing this skill again requires concentration due to the fact that the skill is yet to be second nature. This is the stage where this individual is able to teach the skill to someone else or demonstrate it. Another stage of this is the unconscious competence where an individual has had enough practice with the skill such that it becomes second nature to him  her, and performance of this skill is done easily.

A closer look at Enron, which was at one point one of the largest leader in electricity, communications and natural gas company, before it was declared bankrupt in the year 2001, October. It is also claimed that it is one of the biggest audit failures ever. There were a couple or factors that led to the collapse of this mighty company, but as it is known wherever there is a failure the leadership is the one to blame. Hence if it was a case of poor policies, it is the leadership that suggests such policies and even implements them.

King Solomon who ruled Israel for a long period of time is an ideal leader that most leaders can borrow a leaf from, one of his policies was focusing on his initial mission, and thus he built a temple for the name of the Lord which was a major achievement. Thus, one of the qualities of a good leader is the ability to have a clear vision or picture of where the organization is headed, and also an idea on what success is and means of achieving it. Having vision is in most cases not enough for leaders and thus they must be able to share it with the rest of the organization and consequently act upon it. The management at Enron lacked the vision, when things started going wrong. If the management at Enron had a vision and acted on it, then they could have mitigated the factors that led to the bankruptcy of the company that cost shareholders millions of dollars. Thus the management should have communicated their vision if they had any, both clearly and passionately. Once a vision is set, a good leader should be able to work towards attaining this vision, through discipline, single-mindedness and appropriate direction of the team towards the goals set. A mark of a good leader is action, since leaders should not suffer from action paralysis. The management at Enron seemed to suffer from this syndrome considering how events unfolded to the demise of the company. There was a claim by an analyst that she had spotted transactions that seemed strange but the management brushed off these claims, instead of setting a vision to deal with this problem and clear the claims.

Integrity is a very important quality that a leader should be able to posses. A leader that shows high levels of integrity should be able to do so both internally and externally. Thus, customers and employees alike tend to trust such leaders who exhibit integrity on the inside and the outside because they never tend to steer away from their values no matter how expeditious it may be to do so. Thus it is paramount that a leader displays integrity and owns it, so as to have the trust of his  her followers. Integrity from leaders includes the ability to engage in honest dealings for example the management at Enron was accused of being involved with the Taliban and Dick Cheney the American Vice President was also involved in the allegations. Integrity also enables a leader to show predictable reactions especially in the case when the stocks at the NYSE for Enron started underperforming, the management should have acted accordingly to protect the shareholders from losing their money. This should have involved reacting as the shareholders would have expected them to act for the good of the company. Another show of integrity from a leader is the ability to act in the most sensible manner even when in the face of adversity. This means that a leader should be able to avoid being in unreasonable and having senseless verbal outbursts due to anger. This makes it easier to approach such leaders by their followers. At the time that the Enron scandal was unfolding, the then CEO attacked a Wall Street analyst by the verbally, after the analyst questioned the companys questionable accounting practice. This was due to the fact that Enron did not release a balance sheet and the analyst had noted that fact and in a press conference when he asked the CEO, the CEO showed his lack of integrity by retorting back that he appreciated that fact and called the analyst an Asshole. This lack of integrity on the part of the CEO is what was the beginning of a downward fall for the company owing to its deceptive practices.

Another good quality of a leader is magnanimity, which simply means being able to give credit wherever it is due. This means that a good leader is able to spread credit throughout the company as widely as possibly whenever there is success within the organization. This means that the leader should also be able to take responsibility for mistakes and failures within the company. This is meant to make the other people within the organization to feel good regarding themselves and even increases the cohesive nature of the team. In other words, spreading the fame, taking the blame should be the policy that a quality leader should be able to adopt. In the case of Enron, the CEO, Skilling quite his post as the CEO, with his reasons being that he had some personal issues. Kenneth was quoted as saying that there were no issues within the company be it accounting, trading or even reserve that were known or unknown. This was a mark of poor leadership, and it came back to haunt the company, following its collapse. It was in August that he made these statements and less than two months later, the company was declared bankrupt. It is humility within a leader that defines his ability to be able to effectively drive the team towards set goals, as humility will enable a leader to recognize that he  she is no better than the members of his  her team. A leader who is considered to be humble will try not only to ensure that his  her needs are elevated first, but will try to elevate the status of everyone including the company. It is also important that leaders recognize the fact that status within an organization or a company does not make them a super human being, so as to treat their employees as they wish, and it is only through humility that they will be able to acknowledge that fact.

There are numerous qualities that a good leader should have to ensure that the organization that he leads heads in the right direction in terms of the goals that they had set forth to meet. Poor leadership as stated in this paper was one of the main reasons why Enron was declared bankrupt and it was all avoidable. Thus this paper highlights the connection between success within an organization and quality leadership and thus, safe to assume that quality leadership within an organization leads to the achievement of goals and ultimately success of the company. Enron management failed its shareholders and subsequently failed in its duties as leaders of the once mighty corporation.