Corporate Governamce and the Fall of Enron Ethical Analysis

Utility Ethics: Enron

Utility Ethics at Enron

Why utility ethics is a valid way of deciding right and wrong

Utility ethics are considered to be universal, growth-driven, and offer service to the organization with the only consideration of the right and the wrong. Utility ethics is a valid way of deciding the right and wrong because growth does not always mean that it is right. The same perspective does not apply to failing: failure to grow does not mean the bad. Ethics touches on the best and universally acceptable interactions between the resources, human resource and tools for growth and development within an organization. Utility ethics are universal, with no bias, and always poised for higher chances of growth within an organization. Moreover, utility ethics consider the result and not the immediate results. They are founded on the basis that the process has to be good to have a better result hand (Madsen & Vance, 2009). In the end, the results will not make way to the process. The process does not matter until the result is obtained (Velasquez et al. 2008), as applied at Enron below.

Apply the test

Step 1: Identify the alternative actions that are possible and the persons and groups (the stakeholders) who will be affected by these actions.

Enron's culture is so to blame for the massive fall of its production processes. The cultural setup and the standards issued to cater for the employees and the management teams are not considered culturally and ethically up-to-date. First, it is important to relook at the employment strategy since it is a recipe to the fall of Enron. Employment should have been permanent no matter the result. Secondly, financial objectives and goals are good for Enron. Nonetheless, their pursuance should assure a good path that will give a progressive prediction process into a better result with the financial goals being made. Good profits are worthwhile if the process is not sustainable (Free et al. 2007).

From the two actions, some people will be affected. The management team will have to bear with these new strategies. The CEO, if he or she was for the current production process, will have to adjust to the new ways production that are not just looking at the product but considerate of the process. The employees will benefit with the chance of not being eliminated as unproductive at the end of the year. Moreover, the customers will not be so much bothered but will experience a change in the state of the quality of products at hand (Madsen & Vance, 2009).

Step 2: For each of the most promising alternatives, determine the benefits and costs to each person or group affected.

In this case, there are two most promising alternatives. These are the alternative to having a consideration of the means towards the end and the alternative of making employment permanent. The benefit of the first alternative is that being goal-oriented regarding finances is good but being the objective of the method will prove to be a way to have a sustainable business. This alternative is costly to the result. There is a likely chance that the result will have to be affected, probably in a negative way hand (Madsen & Vance, 2009). The later strategy is of its merits to the employees in that they will consider a better approach, contrary to the utilitarian approach of the result. Rather, the process will be deemed good, which will also, in a scenario of a high chance to likelihood, lead to better performance of Enron. Sustainability of the company would have been procedural and strong to date. This strategy will be costly to the employer, who will have to consider endurance as a way of monitoring minimal but growing performance of the company (Free et al. 2007).

Step 3: Select the action in the current situation that produces the greatest benefits over costs for all affected.

The best action in the current situation that will produce the greatest benefits over costs for all the affected is the action of permanency of employment for the employees at Enron. This will rather appear to deepen so much the benefits gained by the employer. Nonetheless, stringent measures of growth to meet the previous levels of production will be a hard task for the employees. Permanency of employment is a benefit to both of the parties. The employer will have to be content with the new rates of the product and consider the benefits of sustainable productivity on an average scale. On the other hand, the employees will benefit from the permanency and security of the job. Nonetheless, they will be forced to increase their capacity to build and work with the new rates of the product. At the same time, both of the parties will have to adjust to the demands of the new system of production. The employees will have to increase their work rate, although with a more assurance of continued efforts and productivity. The employer will have to cherish the new rates, likely lower than the initial ones, but benefiting Enron at the end (Madsen & Vance, 2009).

One of the other production processes that will ensure more benefits than the costs incurred in production will be to have a growth objective that is geared towards increasing the returns on the expenditures. For instance, it would work better if Enron decides to have all of its employees on a permanent basis, notwithstanding the main features that lead to greater production. Rather, it is important to have a consideration of the process as a sustainable endeavor that benefits through maximum results. Some of the considerations must appreciate the fact that suppliers, customers, financiers, or local communities did not contribute to the fall of Enron (Madsen & Vance, 2009).

Step 4: Discuss what would happen if the action were a policy for all similar situations

If this action were a policy for all similar situations, the product analysis would be instrumental in assessing the process or the way to the result. A utilitarian approach must be adopted as a way of considering the process or the way to the end. With job permanency and deliberated emphasis of the end process and not the result, the situations of functionalism within Enron will be affected. All the situations within Enron will have to get back to the basics of the ethical pathways of productivity. With consideration of utilitarianisms, it is empirical to have a closer look at the result to better the course of action. It is important to have a centralized place where the result will always make ways for change or improvement of the process (Sims & Brinkmann, 2003). In a utilitarian setup, the end should be able to bring about the necessity of the process consideration.

Making the action as a policy will force the entire organization to cling to better and more ethical processes before getting to the result. The employees would engage better production skills and expertise, which lie within the prescribed ethical chores of production. Moreover, it is necessary to have a weighted option of clinging to the product to emphasize the means. Ideally, the employer will not be bothered a great deal, rather, he will be focused and growing regarding the assurance of growth that is sustainable and within the confines of the ethical processes of production (Madsen & Vance, 2009). A policy has to stand with the support of the implementation process. While seeking to foster a better and structured way of promoting a common good and lesser bad, the activity has to be made as policy. All will follow the policy and hence the desire to have a common good will is a better way to ensure universal growth and sustainable development within the organization.