Business Failure of Worldcom in the Light of...

Running Head: Examining Business Failures Business Failure of WorldCom in the Light of Organizational Behavior Theories Abstract Business failures occur usually due to lack of organizational leadership and unethical practices prevalent within an organization. Managers and leaders tend to be a lighthouse for any organization and if they adopt unethical ways, then the entire organization suffer from extreme loss and disgrace. WorldComs bankruptcy scandal is a big example of business failure which was linked to leadership, management style and organizational behavior prevalent within the organization. The failure could not be attributed to poor financial position or downfall of telecommunication, but it was due to poor corporate governance and companys growth strategy through acquisitions. However, these drastic failures could have been predicted if organizational behavior theories and leadership and management styles were utilized properly. This paper discusses what failure was actually encountered by WorldCom and how several leadership techniques and organizational behavior techniques could have used to prevent the failure. WorldComs Business Failure WorldCom used fraudulent account practices for more than four years which lead the company towards the biggest bankruptcy in American history in 2002. WorldCom successfully acquired 65 companies and accumulated a debt of $41 billion. The company suffered a loss of $73.7 billion before it declared bankruptcy inShow MoreRelatedDavid Myers, Worldcom1778 Words   |  8 PagesIntroduction WorldCom was America s second largest telecom company in 2000 (The WorldCom Accounting Scandal, 2002). Making a modest beginning in the hinterland of Mississippi in 1983 with a meager capital of less than 100,000 USD it reached the pinnacle of corporate success reporting more than USD 39 billion in revenue and USD 150 million in MCAP (The WorldCom Accounting Scandal, 2002). 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