Examining a Business Failure
Tori Jordan
University of Phoenix
Organizational Leadership LDR/531
Dr. Michael A. Barker SPHR
January 14, 2009
Examining a Business Failure
Today’s business world is filled with many organizations’ that have been successful, and with the right leaders in place will continue to be successful, because of ethical decisions that are made at inception, and are continuously followed throughout the history of the organization. In order for a organization to be successful, there must be managers in place that know how to lead, and will make sure others like themselves, are protecting company information, and making sure nothing illegal is going on within the organization. This paper will analyze how the organization of “Daewoo” could have been protected if organizational behavior standards were up to par.
At the end of 1999, one of the largest conglomerates in the world, the Daewoo Group, collapsed in spectacular fashion. During its peak, Daewoo was a sprawling enterprise with over 320,000 employees in 500 domestic and foreign companies that operated in over 110 countries. Its management received widespread praise and academic recognition for its success. Yet, when the financial crisis hit, it managed to commit 22.9 trillion won ($15.3 billion) in deception that was termed the “biggest accounting fraud in history, surpassing WorldCom and Enron. Years later, inner-workings of the conglomerate are finally coming to light. After hiding as a fugitive overseas for over six years, Daewoo’s chairman, Woo Choong Kim, returned to Korea in June 2005 to face criminal charges. In 2006, he was sentenced to eight and a half years in prison and disgorgement of a staggering 17.9 trillion won ($ 17.9 billion). This juncture serves as an opportune time to assess the ramifications of the Daewoo debacle. Around the world, corporate governance has emerged as a focal point in the reform of companies. In Asia, a...