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📄 Contents

  1. Management Reference Guide
  2. Table of Contents
  3. Introduction
  4. Strategic Management
  5. Establishing Goals, Objectives, and Strategies
  6. Aligning IT Goals with Corporate Business Goals
  7. Utilizing Effective Planning Techniques
  8. Developing Worthwhile Mission Statements
  9. Developing Worthwhile Vision Statements
  10. Instituting Practical Corporate Values
  11. Budgeting Considerations in an IT Environment
  12. Introduction to Conducting an Effective SWOT Analysis
  13. IT Governance and Disaster Recovery, Part One
  14. IT Governance and Disaster Recovery, Part Two
  15. Customer Management
  16. Identifying Key External Customers
  17. Identifying Key Internal Customers
  18. Negotiating with Customers and Suppliers—Part 1: An Introduction
  19. Negotiating With Customers and Suppliers—Part 2: Reaching Agreement
  20. Negotiating and Managing Realistic Customer Expectations
  21. Service Management
  22. Identifying Key Services for Business Users
  23. Service-Level Agreements That Really Work
  24. How IT Evolved into a Service Organization
  25. FAQs About Systems Management (SM)
  26. FAQs About Availability (AV)
  27. FAQs About Performance and Tuning (PT)
  28. FAQs About Service Desk (SD)
  29. FAQs About Change Management (CM)
  30. FAQs About Configuration Management (CF)
  31. FAQs About Capacity Planning (CP)
  32. FAQs About Network Management
  33. FAQs About Storage Management (SM)
  34. FAQs About Production Acceptance (PA)
  35. FAQs About Release Management (RM)
  36. FAQs About Disaster Recovery (DR)
  37. FAQs About Business Continuity (BC)
  38. FAQs About Security (SE)
  39. FAQs About Service Level Management (SL)
  40. FAQs About Financial Management (FN)
  41. FAQs About Problem Management (PM)
  42. FAQs About Facilities Management (FM)
  43. Process Management
  44. Developing Robust Processes
  45. Establishing Mutually Beneficial Process Metrics
  46. Change Management—Part 1
  47. Change Management—Part 2
  48. Change Management—Part 3
  49. Audit Reconnaissance: Releasing Resources Through the IT Audit
  50. Problem Management
  51. Problem Management–Part 2: Process Design
  52. Problem Management–Part 3: Process Implementation
  53. Business Continuity Emergency Communications Plan
  54. Capacity Planning – Part One: Why It is Seldom Done Well
  55. Capacity Planning – Part Two: Developing a Capacity Planning Process
  56. Capacity Planning — Part Three: Benefits and Helpful Tips
  57. Capacity Planning – Part Four: Hidden Upgrade Costs and
  58. Improving Business Process Management, Part 1
  59. Improving Business Process Management, Part 2
  60. 20 Major Elements of Facilities Management
  61. Major Physical Exposures Common to a Data Center
  62. Evaluating the Physical Environment
  63. Nightmare Incidents with Disaster Recovery Plans
  64. Developing a Robust Configuration Management Process
  65. Developing a Robust Configuration Management Process – Part Two
  66. Automating a Robust Infrastructure Process
  67. Improving High Availability — Part One: Definitions and Terms
  68. Improving High Availability — Part Two: Definitions and Terms
  69. Improving High Availability — Part Three: The Seven R's of High Availability
  70. Improving High Availability — Part Four: Assessing an Availability Process
  71. Methods for Brainstorming and Prioritizing Requirements
  72. Introduction to Disk Storage Management — Part One
  73. Storage Management—Part Two: Performance
  74. Storage Management—Part Three: Reliability
  75. Storage Management—Part Four: Recoverability
  76. Twelve Traits of World-Class Infrastructures — Part One
  77. Twelve Traits of World-Class Infrastructures — Part Two
  78. Meeting Today's Cooling Challenges of Data Centers
  79. Strategic Security, Part One: Assessment
  80. Strategic Security, Part Two: Development
  81. Strategic Security, Part Three: Implementation
  82. Strategic Security, Part Four: ITIL Implications
  83. Production Acceptance Part One – Definition and Benefits
  84. Production Acceptance Part Two – Initial Steps
  85. Production Acceptance Part Three – Middle Steps
  86. Production Acceptance Part Four – Ongoing Steps
  87. Case Study: Planning a Service Desk Part One – Objectives
  88. Case Study: Planning a Service Desk Part Two – SWOT
  89. Case Study: Implementing an ITIL Service Desk – Part One
  90. Case Study: Implementing a Service Desk Part Two – Tool Selection
  91. Ethics, Scandals and Legislation
  92. Outsourcing in Response to Legislation
  93. Supplier Management
  94. Identifying Key External Suppliers
  95. Identifying Key Internal Suppliers
  96. Integrating the Four Key Elements of Good Customer Service
  97. Enhancing the Customer/Supplier Matrix
  98. Voice Over IP, Part One — What VoIP Is, and Is Not
  99. Voice Over IP, Part Two — Benefits, Cost Savings and Features of VoIP
  100. Application Management
  101. Production Acceptance
  102. Distinguishing New Applications from New Versions of Existing Applications
  103. Assessing a Production Acceptance Process
  104. Effective Use of a Software Development Life Cycle
  105. The Role of Project Management in SDLC— Part 2
  106. Communication in Project Management – Part One: Barriers to Effective Communication
  107. Communication in Project Management – Part Two: Examples of Effective Communication
  108. Safeguarding Personal Information in the Workplace: A Case Study
  109. Combating the Year-end Budget Blitz—Part 1: Building a Manageable Schedule
  110. Combating the Year-end Budget Blitz—Part 2: Tracking and Reporting Availability
  111. References
  112. Developing an ITIL Feasibility Analysis
  113. Organization and Personnel Management
  114. Optimizing IT Organizational Structures
  115. Factors That Influence Restructuring Decisions
  116. Alternative Locations for the Help Desk
  117. Alternative Locations for Database Administration
  118. Alternative Locations for Network Operations
  119. Alternative Locations for Web Design
  120. Alternative Locations for Risk Management
  121. Alternative Locations for Systems Management
  122. Practical Tips To Retaining Key Personnel
  123. Benefits and Drawbacks of Using IT Consultants and Contractors
  124. Deciding Between the Use of Contractors versus Consultants
  125. Managing Employee Skill Sets and Skill Levels
  126. Assessing Skill Levels of Current Onboard Staff
  127. Recruiting Infrastructure Staff from the Outside
  128. Selecting the Most Qualified Candidate
  129. 7 Tips for Managing the Use of Mobile Devices
  130. Useful Websites for IT Managers
  131. References
  132. Automating Robust Processes
  133. Evaluating Process Documentation — Part One: Quality and Value
  134. Evaluating Process Documentation — Part Two: Benefits and Use of a Quality-Value Matrix
  135. When Should You Integrate or Segregate Service Desks?
  136. Five Instructive Ideas for Interviewing
  137. Eight Surefire Tips to Use When Being Interviewed
  138. 12 Helpful Hints To Make Meetings More Productive
  139. Eight Uncommon Tips To Improve Your Writing
  140. Ten Helpful Tips To Improve Fire Drills
  141. Sorting Out Today’s Various Training Options
  142. Business Ethics and Corporate Scandals – Part 1
  143. Business Ethics and Corporate Scandals – Part 2
  144. 12 Tips for More Effective Emails
  145. Management Communication: Back to the Basics, Part One
  146. Management Communication: Back to the Basics, Part Two
  147. Management Communication: Back to the Basics, Part Three
  148. Asset Management
  149. Managing Hardware Inventories
  150. Introduction to Hardware Inventories
  151. Processes To Manage Hardware Inventories
  152. Use of a Hardware Inventory Database
  153. References
  154. Managing Software Inventories
  155. Business Continuity Management
  156. Ten Lessons Learned from Real-Life Disasters
  157. Ten Lessons Learned From Real-Life Disasters, Part 2
  158. Differences Between Disaster Recovery and Business Continuity , Part 1
  159. Differences Between Disaster Recovery and Business Continuity , Part 2
  160. 15 Common Terms and Definitions of Business Continuity
  161. The Federal Government’s Role in Disaster Recovery
  162. The 12 Common Mistakes That Cause BIAs To Fail—Part 1
  163. The 12 Common Mistakes That Cause BIAs To Fail—Part 2
  164. The 12 Common Mistakes That Cause BIAs To Fail—Part 3
  165. The 12 Common Mistakes That Cause BIAs To Fail—Part 4
  166. Conducting an Effective Table Top Exercise (TTE) — Part 1
  167. Conducting an Effective Table Top Exercise (TTE) — Part 2
  168. Conducting an Effective Table Top Exercise (TTE) — Part 3
  169. Conducting an Effective Table Top Exercise (TTE) — Part 4
  170. The 13 Cardinal Steps for Implementing a Business Continuity Program — Part One
  171. The 13 Cardinal Steps for Implementing a Business Continuity Program — Part Two
  172. The 13 Cardinal Steps for Implementing a Business Continuity Program — Part Three
  173. The 13 Cardinal Steps for Implementing a Business Continuity Program — Part Four
  174. The Information Technology Infrastructure Library (ITIL)
  175. The Origins of ITIL
  176. The Foundation of ITIL: Service Management
  177. Five Reasons for Revising ITIL
  178. The Relationship of Service Delivery and Service Support to All of ITIL
  179. Ten Common Myths About Implementing ITIL, Part One
  180. Ten Common Myths About Implementing ITIL, Part Two
  181. Characteristics of ITIL Version 3
  182. Ten Benefits of itSMF and its IIL Pocket Guide
  183. Translating the Goals of the ITIL Service Delivery Processes
  184. Translating the Goals of the ITIL Service Support Processes
  185. Elements of ITIL Least Understood, Part One: Service Delivery Processes
  186. Case Study: Recovery Reactions to a Renegade Rodent
  187. Elements of ITIL Least Understood, Part Two: Service Support
  188. Case Studies
  189. Case Study — Preparing for Hurricane Charley
  190. Case Study — The Linux Decision
  191. Case Study — Production Acceptance at an Aerospace Firm
  192. Case Study — Production Acceptance at a Defense Contractor
  193. Case Study — Evaluating Mainframe Processes
  194. Case Study — Evaluating Recovery Sites, Part One: Quantitative Comparisons/Natural Disasters
  195. Case Study — Evaluating Recovery Sites, Part Two: Quantitative Comparisons/Man-made Disasters
  196. Case Study — Evaluating Recovery Sites, Part Three: Qualitative Comparisons
  197. Case Study — Evaluating Recovery Sites, Part Four: Take-Aways
  198. Disaster Recovery Test Case Study Part One: Planning
  199. Disaster Recovery Test Case Study Part Two: Planning and Walk-Through
  200. Disaster Recovery Test Case Study Part Three: Execution
  201. Disaster Recovery Test Case Study Part Four: Follow-Up
  202. Assessing the Robustness of a Vendor’s Data Center, Part One: Qualitative Measures
  203. Assessing the Robustness of a Vendor’s Data Center, Part Two: Quantitative Measures
  204. Case Study: Lessons Learned from a World-Wide Disaster Recovery Exercise, Part One: What Did the Team Do Well
  205. (d) Case Study: Lessons Learned from a World-Wide Disaster Recovery Exercise, Part Two

This is the first of a two-part article on business ethics and some of the major recent corporate scandals that resulted in part from a lack of such ethics. In this first part provide some general background on the topic of ethics and then described two of the four major scandals looked at in this series.

Before initiating any discussion on ethics, it is helpful to first distinguish between personal ethics and business ethics. I define personal ethics as the set values an individual uses to influence and guide his or her personal behavior.

The personal ethics of an individual are usually developed early in one's life. The values of honesty, trust, responsibility and character are typically instilled in a person during childhood. But the degree to which these values are reinforced and strengthened during the trying years of adolescence and early adulthood will vary from person to person. In some cases these early life traits may not always win out over the temptations of power, greed and control.

Business ethics, on the other hand, tend to focus on the behaviors of an individual as it pertains to his or her work environment. The differences between personal and business ethics may be at once both subtle and far-reaching.

For example, individuals who are unfaithful to their spouses will have compromised their personal ethics of trust and honesty. The number of people affected by such discretions may be few but the intense impact of the actions may very well be devastating, life altering and even life-threatening. But if these same individuals embezzle huge sums of money from a corporation, the impact on a personal level may be felt less while the number of people affected — employees, investors, stockholders — could be substantial.

Following the boom and bust dotcom craze of the first few years of the new millennium, a record number of major business scandals occurred in the United States. Tempted with over-inflated stock values, a lack of close government regulation and a booming, optimistic economy, executives with a questionable sense of ethics took advantage of their situations. In 2002 alone there were no less than 28 Fortune 500 companies found to be engaged in significant corporate scandals. The downfalls of the executives from these firms became very public in their coverage, devastating in their effect, and in a few cases stunning in their scope. As details of the criminal acts of these individuals emerged, it became apparent that corporate officers used a wide variety of accounting irregularities to enact their illegal schemes. Listing 1 includes some of the more common of these uncommon practices.

Listing 1 Accounting Irregularities

  • overstating revenues
  • understating expenses
  • inflating profits
  • underreporting liabilities
  • misdirecting of funds
  • artificially inflating stock prices
  • overstating the value of assets

Any number of fraudulent firms from this time period could be held up as instances of unethical business practices, but the following four serve as especially good examples: RadioShack, Tyco, WorldCom and Enron.

The RadioShack Case

The RadioShack Corporation, headquartered in Forth Worth, Texas, offers consumer electronics through hundreds of its retail stores. In May 2005, David Edmondson became RadioShack's Chief Executive Officer (CEO) after having been groomed for the job for years prior. The company did not fare well under Edmondson. Sales and stock price both dropped. Employee morale was low, both for non-supervisory personnel whose employee stock purchase plan was cancelled, and for managers who were subjected to a controversial "Fix 1500" initiative in which the lowest rated 1500 store managers out of 5000 were on notice to improve or else.

Edmondson's final undoing was due less to his corporate performance and more due to a personal lack of ethics. Police arrested Edmondson for driving under the influence in early 2006 at about the same time reporters learned he had misstated his academic record on his resume. Edmondson claimed he had earned degrees in theology and psychology from the Heartland Baptist Bible College when, in fact, school records showed he had attended only two semesters and was never even offered a course in psychology. On February 20, 2006, a company spokesperson announced that David Edmondson had resigned over questions raised by his falsified resume. The company struggled through all of 2006 attempting to recover its financial health.

Edmondson's civil indiscretions are small in comparison to the criminal behavior of other executives described in this section. Still, it points out how unethical behavior by even one key individual can have far reaching effects on a company and its employees, including all those working in the IT department.

The Tyco International Case

The scandal at Tyco International, a diversified manufacturing conglomerate whose products include toys, plastics and household goods, was far more significant than that experienced by RadioShack and eventually led to criminal prosecutions. CEO L. Dennis Kozlowski and Chief Financial Officer (CFO) Mark Swartz had both enjoyed highly regarded business reputations before their fall from grace. Business Week magazine, in its January 14, 2002 edition, even listed Kozlowski as one of the top 25 corporate managers of 2001. By September 2005 both were being led away in handcuffs to begin serving between 8-1/3 to 25 years in prison.

On June 17, 2005 a Manhattan, New York jury found Kozlowski and Swartz guilty of stealing more than $150 million (U.S. dollars) from Tyco. Specific counts included grand larceny, conspiracy, falsifying business records and violating business law. Judge Michael J. Obus, who presided over the trial, ordered them to pay back to Tyco $134 million. In addition, the judge fined Kozlowski $70 million and Swartz $35 million.

The case came to represent the pervasive impression of greed and dishonesty that characterized many companies who enjoyed brief periods of prosperity through devious means. When some of Kozloski's extravagances came to light during trial, they only served to fuel this notion. These included him buying a shower curtain for $6,000.00 and throwing a birthday party for his wife on an Italian island for $2 million, all paid for with Tyco funds.

Summary

This concludes part one of the two-part series on Ethics and Scandals. In this initial segment I discussed the issues of personal and business ethics, and then described two recent corporate scandals involving RadioShack and Tyco International. In part two I look at two even larger recent scandals involving WorldCom and Enron.

References

  1. http://www.usatoday.com/money/industries/manufacturing/2005-06-17-tyco-timeline_x.htm
  2. http://www.cheatingculture.com/tyco.htm
  3. http://money.cnn.com/2005/09/19/news/newsmakers/kozlowski_sentence/

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