Examining a Business Failure Paper A leader is “the person expected to perform the specialized leadership role,” (Yukl. 2006. p. 4). Not all leaders are effective and their leadership leads to business failures. Questions arise about what leadership is and how it relates to the success or failure of an organization such as Tyco. Leadership in an organizational role involves establishing a clear vision, sharing that vision with others so that they will follow willingly, providing the information, knowledge, and methods to realize that vision, and coordinating and balancing the conflicting interests of all members or stakeholders,” (Business Dictionary. 2010. para. 1). This paper will explain how the failure of leadership led to the failure of Tyco in 2002. A good leader will not only direct his or her followers but will also motivate those followers to contribute to the best of their ability for the success of an organization.
A leader is put in place to help an organization move forward and not only make a profit but also to become a well rounded organization in all aspects. In order for a leader to do this, he or she must encourage his or her followers to become an active part of the organization. Active participation by employees will give the leader the insight needed to see in what direction the organization is going and what changes need to be made to keep it on or bring it back on track in order to meet the goal set forth by the organization. “Tyco International Ltd.
Is a diversified, global company that provides vital products and services to customers in more than 60 countries,” (Tyco. 2010. para. 1). Tyco consists of five business segments including fire protection, safety, electrical, and metal products, and flow control. Today, Tyco is a successful organization under the leadership of “Ed Breen, Chairman and CEO,” (Tyco. 2010. para. 3). This wasn’t always the case for Tyco, in 1992 Dennis Kozlowski became CEO of Tyco and proceeded to run the company into the ground over the course of the next 10 years.
Kozlowski failed as a leader, he did not use the strategy, execution, or communication skills necessary to be an effective leader, instead he allowed greed to control his decisions and that greed lead to the downfall of Tyco. Theories of organizational behavior could help explain what happened with the leadership at Tyco and why greed caused the company so many problems. Psychology, sociology, and social psychology can all help explain what happened at Tyco. Psychology studies the individual and contributes to one’s perception and individual decision-making, (Yukl. 2010. p. 13).
Kozlowski had poor decision-making skills as is evidenced by his need to serve himself instead of serving and motivating his employees. This is seen again in his need to take loans and benefits from the company without proper authorization and approval. Sociology contributes to OB through power, conflict, and organizational culture. Social psychology contributes to the study of OB through behavioral change, attitude change, and communication, (Yukl. 2010. p. 13). Each of these theories can be seen and evaluated to help explain what happened to Tyco because of Kozlowski’s greed and personal ambition.
Ed Breen, was appointed CEO of Tyco in 2002 after Kozlowski’s resignation. Under Breen’s leadership Tyco has recovered from the scandals and is once again a company held in high esteem. Breen seems to realize that he is their to lead and motivate his employees instead of himself. Because Breen implements solid leadership strategies and communication skills, he has turned Tyco around and brought it back from failure. In conclusion, poor leadership contributed to the failure of Tyco under the leadership of Kozlowski but under the solid leadership of Breen Tyco has turned around and is once again on top of the corporate world.