Mgmt 210

Problem Symptom- The primary symptom is the repeated appearance of impropriety in the actions of the CEO Mr. Joe Ryan.   The latest issue is the public appearance of the CEO with a junior employee at the grand opening of what could be considered to be a nightlife attraction.   There is also the recent loss of his secretary of two years Ms. Ulin.   Senior managers who happen to be female have become more vocal in their disapproval of Mr. Ryan’s behavior, while at least three members of the Board have questioned him reference questionable actions.   Most egregious is what appears to be an unwarranted promotion to Factory Manager for Ms. Crogan despite her not appearing to have any of the prerequisite training or experience for the position.
Problem Cause- The root cause of the symptoms is that the Board of Directors has failed in their responsibilities of ensuring that the CEO’s behavior exemplified his integrity as well as vision, strategy and competence.   A leader should have all four components and a deficiency in any one presents significant challenges for both the organization as well as the leader.   Mr. Ryan’s behavior has been largely ignored because the company has exceeded both financial and operational performance goals while attaining record growth under Mr. Ryan’s leadership.   Mr. Ryan possesses a combination of business sense and charisma that has enabled him to drive Glamor-a-Go-Go employees to achieve results that the company would not likely have been able to attain without his presence and efforts.
Alternatives-   The first alternative is to do nothing and continue to enjoy the record profits and growth.   If a large shareholder, then ensure you diversify your portfolio just in case Mr. Ryan’s behavior destroys significant shareholder value.   The second alternative is for the Board to confront Mr. Ryan with the list of transgressions to date.   In addition the Board should direct the Ethics Committee and Human Resources to develop an official policy on...