So far, I used to think that numerous companies experienced financial crises and even bankruptcy because their CEOs had failed to provide viable solutions to problems. In addition to this, as my work dealt with public sector administration, I firmly believed that the governance strategies were applied to non-profit and governmental administrations.
During the lectures, I have realized the actual meaning and definition of corporate governance, which can be defined as an integral system embracing policies, people, and processes, that serves stakeholders’ needs by controlling and assisting in business activities directed at objectivity, integrity, and accountability. More importantly, I have learnt other related definitions, like globalization, integration, and market magic that are closely connected with corporate governance and leadership policies. Finally, in the course of study, I have also understood the main peculiarities and recent tendencies of conducting business as well as possible types of legal violation. I have also concluded that the creation of multinational corporations provides some challenges for managers since they should take into account ethical and cultural issues to prevent communication problems and to encourage company’s productivity and sustainability.
Relying on this theoretical framework, I have defined that the Vodafone-Mannesmann case reveals the problems connected with corporate culture established within the company (Clarke, 2005, p. 402). The case has disclosed the encounter of two strategic policies of corporate governance on the part of Germany, which is in favor of collective decision-making and mutual agreement and on the part of British mergers, which are more concerned with the stakeholders’ interests and investments. Being concerned with internal policies, the merged Mannesmann has given way to Vodafone that has managed to pay more attention to the foreign policy. This is why I think the weak chain of German companies was lack of transparency and absence of sufficient connections and partnership with other competent organizations. Certainly, I cannot but admit that German company had a rich history of corporate culture development, where the managers were primarily concerned with the employees’ welfare and their involvement with the production process. All their resources, hence, were directed to creation and improvement of a well-structured system of support and communication within the company. In my opinion, this imbalance has lead to the frustration of the company’s strategies.
On the other hand, the analysis of Vodafone policies also uncovers some gaps in treating the employees. To be more exact, Vodafone’s executive branch has failed to consider the essential employees’ needs since it is more focused on the development of foreign policy.
With regard to the Enron case revealing inappropriate corporate governance policy in terms of information management and financial speculations, Vodafone-Mannesmann case outlines certain problems with organizational and corporate strategies. However, the similarities between the cases are revealed through the consideration of ethical problems but in different spheres of management. Hence, Mannesmann’s hidden information exchange has lead to negative consequences for the company’s image. In its turn, Enron’s company has been involved into illegal financial operations and ignored ethical and cultural concerns. Anyway, the case in question provides consistent approaches to the corporate governance of the company being the largest international organization.
During the previous week, I became the forth member of a project team. My group and I decided to select the Vodafone-Mannesmann case as the core case for investigating the main principles of corporate governance and organizational culture.
The case study may help us to develop necessary research skills for further understanding the main aspects of corporate governance as well ethical and legal problems connected with this case. Also, it is not of minor importance to consider how the process of globalization is associated with the problems of organizational management and what shifts it bears to the company in question. Our group will plan to divide the questions among the members. For this assignment, we will divide our group in two to consider global and ethical questions. My partner and I will answer the second question. Each question will be split into several issues that will be tackled individually.
Plan for the Next Two Weeks
In order to foster the accomplishment of the assignments, I have decided to read the textbook by Thomas Clark (2004), an effective companion to the International Corporate Governance analyzing the global tendencies in development and improvement of corporate strategies.
Reference List
- Clarke, T. 2004. Theories of corporate governance: the philosophical foundations of corporate governance. NY: Routledge.
- Clarke, T. 2005. Vodafone-Mannesmann Case. International Corporate Governance: A Comparative Perspective. NY: Routledge, pp. 402-417.