Tyco Company: Communication, Collaboration, and Conflict Management

An exploration of the what went wrong with the Tyco management strategies, resulting in such unethical and illegal corporate behaviors.

Ethical behavior and quality workplace culture has gained public attention from the multiple scandals that were prosecuted in 2002. Training In all aspects of governance, leadership behavior, ethics, and compliance review are more prominent today. Training policies for Tyco will provide all staff with the knowledge and skills necessary to take action and improve the responsibility of their individual work areas. Ethical leadership from the top is necessary to define and provide the commitment to quality and culture at Tyco.

Tyco could certainly benefit from training on working effectively as a team, not just individual work. Group decisions, contributions, and communication are important skills of good value to Tyco. This training will be a part of all new hires and their orientation process as well as annual refresher training for all current positions, corporate and non-corporate alike.

Any group of people or workers can form a team and the size can be small or large. Teams are the working and performance units in most companies. The size of the team is not as important as the style that they adopt for basic success. Teams that adopt an overall supportive and collaborative theme are generally more successful. Good communication between the individuals of a group is the foundation for success and key to functioning smoothly with significant and tangible performance that exhibits quality and ethics in team behavior.

The General Management at Tyco was not truly committed to quality behavior and ethical practice. Support and belief in the company mission statement that not only reflects quality and professional ethics, but also practices these principles through aggressive training and orientations will reduce the probability of financial misconduct. By providing avenues for employees to practice good behavioral ethics that support the public trust, through proactive training and comprehensive new hire orientations, Tyco will again enjoy public confidence and prosperity.

Annual training in basic business ethics and behavior is needed for all levels of Tyco employees, from the top of upper management and down through the departments that are involved with financial reporting and individual accounting for all sales and service documentation. This type of ethics training should also be included in every orientation as part of the Tyco vision for standard and acceptable business practice. Reinforcing an approach for good ethical behavior practices should start from the initial stages of new hire education.

One of the reasons that Tyco senior management failed to participate actively in the review of acceptable corporate governance to provide reasonable assurance for ethical and approved business practice regarding financial tax reporting and overall corporate governance was that it was not a subject of focus in the early decades of aggressive acquisition and growth enjoyed by Tyco. Worry about internal ethics had not gained the attention it has today. Quality of governance and internal review changed significantly with the enactment of the SOX requirements.

Establishing good compliance policies and an oversight system to make sure that policies are followed correctly is important for all companies. Goals are established to accomplish an organizations mission and vision for future conduct. Tyco’s mission statement to surpass customers’ expectations and achieve operating excellence in the company, indicates that every intention for ethical practice was present, but the policies to assure this type of behavior were inadequate to prevent it from happening. Therefore, a certified and documented training program to review the standards and accepted guidelines of generally accepted auditing standards (GAAS) and internal financial tax reporting is certainly recommended. This is a good way to stay in compliance, as audit reports are recommended to include if the financial statements have been prepared in conformity with the generally accepted accounting principals (GAAP). The auditor further needs to provide and express an opinion on the financial statements. (Studyworld, 2009) Training programs to address these recommended guidelines, will ensure that financial staff can proceed in a direction consistent with financial reporting guidelines based on the (GAAP). Achieving such goals would have required executives to define better oversight policies for behavior review that would have better served and protectd the company.

Individual training is necessary for all staff involved in financial reporting and internal review. Annual training courses for all financial executives, internal auditors, CPA’s, and tax accountants and their staff must be implemented and monitored. This training will be more regulatory and cover basic legal compliance for finance staff. This will cover the staff’s technical training and proficiency to help meet the public trust. This might best be proctored by an outside agency for various reasons, to meet SEC and SOX standards. The PCAOB is charged with regulating and inspecting the employed accounting firms that perform in the auditor capacity for public companies. They also have the option and authority to make recommendations to set standards for auditing and accounting, internal control reporting and quality control, and require CPA firms that accept public audit contracts to register with them (PCAOB) and obtain a license to perform in a public capacity. (Rittenberg and Schwieger, 2005)The corporate policies for Tyco were not implemented with effective oversight capability for corporate tax governance. Internal control methods were inadequate and had no procedures for review of financial reporting. The company enjoyed continuous expansion that began in the 1970s, when little focus was directed toward ethical behavior training for corporations. This likely contributed to the inadequate corporate governance at Tyco, regarding financial reporting as well as insufficient review procedures for ethical behavior at the executive level. The result was a costly oversight for Tyco. Through group collaboration, consensus indicates that a mandatory training course in business ethics should be included at orientation and as an annual refresher course. Additionally, in an effort to avoid misdirected peer pressure in the financial divisions, similar courses in conflict management and resolutions should also be included as part of the annual corporate refresher training. Necessary for global operations today is mandatory training in cultural diversity and communications, annually and at orientation. A portion of the diversity training should be devoted to difficult personalities. Tyco will be far better prepared and positioned strategically to fend off any potential threats to future prosperity and success through implementation of comprehensive training courses made available and provided to the correct levels of personnel at optimum times.

ReferencesRittenberg and Schwieger (2005). Auditing: Concepts for a Changing Environment (5th ed.) Thomson. Mason. OH. Retrieved April 2, 2009Sarbanes-Oxley Act 2002. Retrieved April 1, 2009, from online document search, http://www.soxlaw.com/index.htmStudyworld. Generally Accepted Auditing Standards (Retrieved April 3, 2009, from http://www.studyworld.com/newsite/reportessay/Science/Technical%5CGenerally_Accepted_Auditing_Standards-34746.htm