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Arthur Andersen's Management

Management planning is a skill that is undervalued when planning goes well but whose true value becomes evident when planning is insufficient and things go awry. A good example of the latter is the debacle at Enron involving the giant accounting firm Arthur Andersen. While Enron's underhanded tactics shocked the world when the truth came out, much of what Enron did was accomplished in complicity with Arthur Anderson, without whose help Enron could not so easily have concealed its enormous debts and avoided paying federal income tax over many years. At least partly as a result of Arthur Anderson's duplicitous handling of Enron's accounting, both firms ended up going out of business, and tens of thousands of employees lost their jobs ("Lou Dobbs Tonight," 2005). This paper will examine Arthur Andersen's planning function; the impact on it of such factors as legal issues, ethics, and corporate social responsibility; and factors that influenced the company's strategic, tactical, operational, and contingency planning.

The planning function of management is one of four basic functions(the others being organizing, leading, and controlling(considered integral to managing a company (McNamara, n.d.). Planning, according to business consultant Carter McNamara (n.d.), is "identifying where you want to go, why you want to go there, how you will get there, what you need in order to get there and how you will know if you're there or not." Paradoxically, considering its own poor planning with respect to the Enron case, Arthur Andersen was often hired to help its clients with their own planning. It even developed web-based software, eMergeTM, whose functions included management planning. In an article discussing eMerge, Arthur Andersen stated that "Companies often spend insufficient time analyzing and anticipating current and future market trends...[and] forego an objective analysis of their strengths, weaknesses, opportunitie...

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Arthur Andersen's Management. (1969, December 31). In Retrieved 07:20, August 19, 2022, from