Managers Are Increasingly Recognised As Powerful And Privileged Essay

Managers Are Increasingly Recognised As Powerful And Privileged Individuals Who Are Not Always Held Accountable For Their Actions. Should This Power Be Regulated - Essay Example One such living example is the case of MG Rover, a Britain based car company that has suffered the consequences. It is time, we learn our lessons, and along with the wings of power, render the reins of responsibility. MG Rover, apparently the last British owned mass-producer of cars in the British motor industry was established in the year 2000 by the merger of MG and Rover from BMW. At that point of time, BMW sold, rather abandoned Rover at throwaway prices. They offered an interest free loan of 427 million, repayable by 2049 to those who were willing to take it. Along with this, the buyer would be left with 350 million worth of unsold cars along with the alluring cash dowry of 112 million. This made Phoenix interested in the deal and enter the arena. The Phoenix consortium comprised of British businessmen and was headed by John Towers, former Rovers executive. They bought the company for 10, and emerged as saviors for Rover at that point of time. The organization showed a downfall as it exchanged hands, but deals like the purchase of the Qvale of Italy in 2001 went on. It collaborated with Tata, India in 2002 and also launched MG SV and SV-R in 2003, followed by launch of Rover CityRover. During its peak, the company employed approximately 170,000 workers. In the year 2004, the organization entered into talks with the Shanghai Automotive Industry Corporation (SAIC). A collaborative deal that was negotiated between the two companies fell through in the year 2005, forcing MG Rover into insolvency. The company entered into administration in April 2005. Because of the company's failure, 6000 workers lost their jobs and thousands of jobs in related sectors of the supply chain were threatened. Not just this, the entire economy of West Midlands suffered a blow because of the mistakes made by a handful of people. Where what went wrong The reasons why MG Rover failed were many. The car company, as it exchanged hands was almost always in troubled waters. One reason why Rover lost its brand value goes to over 25 years ago, where the cars were not as high quality. Even though efforts to improve quality were made, the brand image of a lower quality had already been built. The management was myopic in its approach and overlooked the real opportunities. Also the British public did not support the car much, as they preferred to buy foreign brands over the Britain based MG Rover. Many experts also feel that had the government rendered a timely response, much could have been saved. In May 2000, the Blair government had praised the Phoenix for its efforts for taking big risks. They had also promised everything that could be possibly done to save the company. But the response was not as timely as it could have been. The government has now however come up with the 150 million package, where workers are being paid the amount, to stay at home. However had action been taken four years ago, and the firm been nationalized, probably workers could have been paid much more in compensation. It is also an important lesson for the present government on choosing the right leaders/ managers for an organization. However actual disaster was with the management and its operations. For four years, the