Lessons coming from Lehman Siblings: Will We Ever Master?
September 9, 2013
Lehman Brothers financial services filed bankruptcy upon September 12-15, 2008, in the New York The southern part of District U. S. Bankruptcy Court. Leading to an immediate 500 point drop in the Dow Jones (Did Ernst & Young Actually Assist Economic Fraud? 2011). This day started to be known as вЂвЂDark Monday'' (Donaldson, 2012). This is to date, the greatest bankruptcy filing in history unleashing a " crisis of confidence that threw monetary markets worldwide into hardship, sparking the worst crisis since the 1930s. вЂќ However this financial icon's show up is no surprise. The bankruptcy examiner unveiled reports saying that the business executives and auditor, " lambastedвЂќ for what they did to cause the collapse from the firm (Robbins & Coulter, 2010). The Lehman Sibling culture was one of risk and incentive. At the firm, " Abnormal risk currently taking by personnel was honestly lauded and rewarded handsomely. Employees understood they may give risky ideas and so they would get rewards for them. Persons making sketchy deals were hailed and treated because вЂconquering heroes'. вЂќ (Robbins & Coulter, 2010, pp. 147-148). If anyone would issue decisions manufactured or speak out in disagreement, executives will not listen. In addition , the professionals would overrule and go with the least attractive decision. Additional would be wary of taking a lot of risks and later give incentive after that risk had confirmed to be a good decision. For the Lehman Siblings if the risk turned out to be negative and the organization was actually in a dropped, they would hide it. Lehman was once reputed for its " FamilyвЂќ like culture. What exactly happened? According to Greenfield (2009), " the mistake lay down in adding too much hope in an outmoded culture and failing to find out how its very power undermined the businessвЂќ. Additionally , the tradition was afraid of change and variety. This also led to the company's downfall. " A tradition that is...
References: Did Ernst & Small Really Assist Financial Fraud? (2011). Ideal Finance, 92(9), 14-17. Recovered from http://search.proquest.com/docview/857240730?accountid=458
Donaldson, To. (2012). 3 ethical beginnings of the economic crisis. Journal of Business Ethics, 106(1), 5-8. doi: http://dx.doi.org/10.1007/s10551-011-1054-z
Greenfield, They would. (2009, В Fall). Culture Battle. The Meeting Board Assessment, pp 60-65
Robbins, Coulter, S. (2010). Management (11th ed). Pearson Learning Solutions. Retrieved via http://online.vitalsource.com/books/9781269357937/id/pg147
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