Abstract
Strategic management is the identification and description of the strategies that managers implement in order to achieve their organizational long-term goals via better performance and gaining competitive advantage in the process. Corruption, on the other hand, is known as dishonest or fraudulent conduct by the people/managers in power. In this sense, it becomes inevitable in organizations, where there is always a conflict of interests, not to experience corruption behavior. At this point, preventing and coping with corruption constitutes importance. In this context, the purpose of this chapter is to scrutinize the literature in the frame of strategic management, strategy, organizational policies, corruption, and the strategies and policies that are effective for coping with corruption. In addition, the chapter also consists of some international corruption scandal examples.
TopBackground
Strategic management refers to the strategies that serve for achieving long term goals via competitive advantage, which requires an effective human resource. Organizational policies are documents that present guiding principles on a particular topic (e.g. human resources, IT use) and that are established by senior management to shape employees’ actions and perceptions in regard to this topic (Foote et al., 2005; Six & Sorge, 2008). In this sense, when the classical approaches and precautions are inadequate, corruption in organizations can be prevented or eliminated via professional organizational policies. In this context, the purpose of this study is first to draw a general frame of strategic management, organizational corruption and organizational policies. Upon drawing a general frame of the mentioned concepts, it is aimed to scrutinize the literature in terms of today’s organizations and it is also aimed to present some examples from the organizations that try to cope with corruption and/or implement effective policies and strategies. The effective strategies and organizational policies that are thought to be effective in eliminating and/or preventing corruption in organizations are also aimed to be presented in detail.
Key Terms in this Chapter
Strategy: A plan of action designed to achieve a long-term or overall aim.
Strategic Management: Identification and description of the strategies that managers can carry so as to achieve better performance and a competitive advantage for their organization.
Enron Scandal: The Enron Scandal involves Enron duping the regulators by resorting to off-the-books accounting practices and incorporating fake holding. The company utilized special purpose vehicles to hide its toxic assets and large debts from the investors and creditors.
Favoritism: The practice of giving unfair preferential treatment to one person or group at the expense of another.
WorldCom: WorldCom has revealed a further $3.3bn in accounting errors, doubling the size of the accounting scandal at America’s second largest long distance phone company to more than $7 billion.
Transparency: The quality of being done in an open way without secrets.