Management Planning at World Com

Introduction

The company was formed in the US in 1983.  The company became quoted in the stock exchange in 1989.  The company’s growth was mainly by acquisition, in  1999 it acquired MCI to become one of the biggest communication giants in the world.  Bernard Ebbers become the company’s chief executive in 1985.  In 1998, the telecommunication industry in the US was in the decline performance wise Mr. Ebbers was ousted, from the position in 2001.

Between 1999 and 2002 world com was involved in a series of fraudulent accounting practices in order for the company to portray profitability whereas the telecommunication industry was performing poorly.  The directors carried out this activities so as to maintain the high share price of the company in which they held many shares.  The internal audit department at world com uncovered  the more than $3.8 billion fraud, and alerted its main external auditors who were KPMG.  Subsequently in July 2002 the company filled for bankruptcy.  However, the company emerged from bankruptcy in 2004 .

Planning involves evaluating the impact of present decisions on the future.  The other managerial functions are carried out only after planning function has been carried out.  Planning is relevant to all managerial levels.  Planning involves coming up with the vision mission, objectives and goals.  A vision communicates where the firm should be in 5- 10 years time while the mission is the rationale for business existence objectives on the other hand convert the mission, into achievable tasks.

Goals used to further express the objectives.  The goals in order to be acceptable should be SMART that is they should be specific, should be measurable, should be attainable; they should be rewarding and should be timely.  World com has developed tactics which describe how, who, what and when activities will occur to enable the goals to be accomplished. World com carries out strategic planning.  Strategic planning helps the firm know where it is now, where it wants to be and how it will get there.

World com has been unable to efficiently plan its operations.  This is because  strategic planning process requires a lot of resources.  .  In 2002 the company was involved in a number of accounting scandals.  This made it file for bankruptcy.  The company had to pay more than $750 million, to the authorities to compensate investors.  The legal issues have affected world com since it can no longer attract competent managers, who can effectively and efficiently handle management planning at world com. {Ghallab 2004}

In 2004, the company was able to come from bankruptcy but still it could not carry out management planning effectively.  World com had to pay its previous bond holders the value of their bonds, this payments affected the operations of the company.  World com also faced a number of contingent liabilities since it had very many suits pending in court; this meant that the management at world com could not be able to effectively carry out management planning

Ethics refer to ethical principles and moral that can suffice in corporate set up.  In world com a number of unethical practices have occurred.  Since companies aim at maximizing shareholders wealth, but at world com major corporate governance lapses have occurred in that, the directors art world com, contracted on improving their persona interests making the shareholders incur major losses.  In world com, directors were not able to follow the prescribed code of corporate governance leading to major losses in the organization, and consequently the management was not able to carry out management planning

Corporate social responsibility refers to the organization looking at the interests of other stakeholders.  It involves the organization, caring  for the community are large.  World com was not a good corporate citizen since it did not look at the affairs of stakeholders like the government, shareholders and the general public.  A company which manages effectively its social responsibility programs enjoys a good corporate image in the eyes of the community.  World com lacks the effective resources to carry out sound social responsibility programs and this affects the management planning process, since, the objective set in the social responsibility department will not be met.  World com had too much power that the directors could control the share prices at the stock exchange.