Leadership Failure at Tyco

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  • Topic: Dennis Kozlowski, Tyco International, Management
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  • Published : April 8, 2012
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Lessons of Tyco: Just Say No

OCTOBER 6, 2008

FORMER GENERAL COUNSEL TO REAGAN, TYCO DISCUSSES ETHICS AT VLS

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William B. Lytton speaking in the Chase Center at Vermont Law School.

William B. Lytton remembers the aura of working in the White House in 1987, amidst the power and the personalities that surrounded President Ronald Reagan. Lytton had taken leave from his Philadelphia law firm for six months to act as Deputy Special Counselor for Reagan during the Iran-Contra investigation. “I would mentally pause and think of how fortunate I was to be there,” Lytton recalled. But as if to check that emotion, he would summon the lessons of John Dean, the young White House lawyer who found himself caught up in the Watergate scandal after allowing himself to become “dazzled,” as Lytton put it, by the blinding light of power. Speaking to several hundred Vermont Law school students, Lytton recommended they readBlind Ambition, Dean’s memoir about the Watergate years. The book, he said, would serve as a vehicle for young lawyers to question themselves on how they might behave in such a situation. Lytton’s Oct. 6 lecture, entitled “Just Say No,” laid out the ethical challenges faced by lawyers in a culture where it is often difficult to speak up to power, whether it be in a politically charged atmosphere such as the White House or in a corporate culture such as Tyco International. Lytton stepped in as general counsel at Tyco in 2002 as the company was enmeshed in a multi-billion accounting fraud scandal. Lytton’s role was to resolve the legal issues and clean up the culture, no small feat in a $38 billion company that employed 260,000 people worldwide. His friend was among those under indictment. In the Tyco failure, Lytton said, “They failed as leaders. They forgot that leadership was about serving others and not themselves.” But it was also a failure of those who follow the leaders, the corporate lawyers who failed in their duty to keep the leaders in check. Like John Dean during Watergate, Tyco lawyers wanted to please their bosses. When the scope of the corporate corruption became clear, Lytton said, the remaining questions were, “Where were the lawyers? Where was the harsh spotlight of scrutiny?” Yet while the public clamors for criminal prosecutions in such cases, Lytton maintains that it is not illegal intent, but rather the culture of the corporate world and the pressure “to make your numbers” that often drives corporations into such scandals. “Most of the people who became infamous for their misdeeds&helip;were not evil people,” said Lytton, who also serves as a VLS Trustee. As he sees it, they lost sight of the cultural boundaries, blinded by their own career advancement goals. That, he said, is where the role of the corporate lawyer becomes critical. “As a lawyer, you have a greater and a different responsibility than everyone else,” he said. While it might prove difficult to stop bad things from happening, “Sometimes,” he said, “you do need to just say no.”

A leader plays very important role in the success of the organization. Good leader has vision and he can take the organization forward, a not so good leader finds himself unable to influence the employees and lacks vision and he may cause the failure of the organization. A good leader has exceptional quality to influence his followers . A leader has extraordinary effect on followers and followers become committed to the leader. So, if leader is taking his followers towards the organizational goal, it is positive for the organization. A good leader has power to motivate the followers to contribute individually and hence collectively to the organization. Leader helps the followers (employees) to achieve the goals and objectives set for the organization. A participative leader includes the employees in decision making process. He encourages the employees to share their ideas and views which is considered in decision making process. It makes the...
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