10 Worst Companies
What happens when leaders fail to follow great management principles and strong corporate values?

The great management principles developed and honed by leading companies are emulated by thousands of organizations throughout the world for both good and ill. The good, of course, stems from the unifying and galvanizing effect of great management principles and strong corporate values on people and corporate cultures. The ill, on the other hand, arises when managers and leaders fail to practice these principles, or practice them inconsistently, resulting in work cultures of contradiction and absurdity that can turn leadership truths into lies—lies that, if left unexposed and uncorrected, constitute management malpractice. Management malpractice of this sort creates corporate cultures of cynicism and contempt that damage morale, destroy productivity, and slowly erode organizations.

According to recent surveys, including the National Business Ethics Survey, more than 50 percent of all employees in the United States observe misconduct or unethical behavior at work, but most do nothing to report it for fear of retaliation from management or coworkers.

Craig Hickman's 10 Worst Companies (in no particular order):

  1. HealthSouth
    Federal prosecutors are untangling years of bogus accounting and a massive scheme that reverberated throughout the highest levels of the company. With 15 guilty pleas so far, federal prosecutors still aren’t done.
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  2. Enron
    Shortly before Enron’s demise—which resulted in massive layoffs, thousands of employees losing their retirement funds in 401(k) plans tied to company stock, shareholders losing their investments, and the largest bankruptcy in U.S. history—more than 500 of the company’s executives received hefty bonuses, some in the millions of dollars and many others in the high six figures.
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  3. Global Crossing
    The collapse of telecommunications giant Global Crossing—which was driven by its practice of inflating revenue and cash-flow statements to make the company appear more favorable to investors and analysts—provides yet another now-infamous example of the lack of ethical behavior among the executive ranks of major corporations.
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  4. WorldCom
    CEO Bernie Ebbers was recently found guilty of securities fraud, conspiracy and filing false documents with regulators. In order to meet Wall Street's expectations and relieve pressure from investors, Ebbers ordered CFO Scott Sullivan to overstate company earnings by billions, over $5 billion according to prosecutors. Ebbers, age 63, now faces 25 years in prison.
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  5. Tyco
    Former CEO L. Dennis Kozlowski and former CFO Mark Swartz were convicted on June 17, 2005 of 22 counts of securities fraud, conspiracy, and larceny. Kozlowski and Swartz were found guilty of embezzling more than $600 million from the company to finance decadent lifestyles. At the trial, both claimed ignorance of any misconduct.
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  6. Kmart
    The forty-year-old discount retailer built a powerful brand only to see it taken over by Target and Wal-Mart. Holding on to old assumptions and biases about low prices, quality products, store location, and marketing were not enough to save the one-time $40 billion retailer from massive layoffs, store closings, and bankruptcy.
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  7. Sunbeam
    In 2001 Sunbeam was ordered to restate its financial earnings for 1996 and 1997 and the US Securities and Exchange Commission (SEC) sued former CEO Al Dunlap and other executives after they were charged with arranging a "massive financial fraud". Sunbeam had claimed sudden, colossal increases in sales, but close examination revealed these claims to be greatly inflated. The SEC contends that $60 million of Sunbeam's $189 million 1997 earnings were the product of accounting fraud.
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  8. Adelphia
    On September 22, 2002, a federal grand jury in Manhattan accused five former Adelphia executives—John, Timothy, and Michael Rigas, James Brown, and Michael Mulcahey—on 24 counts of securities fraud, wire fraud, and bank fraud. Despite three years with new management determined to clean up the mess left by former executives, Adelphia is currently filing for bankruptcy and will soon be acquired by Time Warner Inc. and Comcast Corp.
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  9. Polaroid
    This emblem of photographic advancement collapsed with the arrival of digital photography and one-hour developing. As Tim McLaughlin puts it, Polaroid failed to make the digital leap because its executives “overestimated the value of their core business” and consequently stopped innovating, stopped anticipating and creating customer problems and needs.
    Read more.
  10. Qwest
    On December 20, 2005 former CEO Joseph P. Nacchio was indicted on 42 counts of securities fraud and insider trading. Nacchio had announced extremely aggressive financial targets for 2000, fully aware of the great implausibility of actually meeting such targets according to prosecutors. In the following months, Nacchio proceeded to sell his personal stock at an accelerated rate. In August 2001 when the company reported its actual network sales, Qwest's stock collapsed. The company now trades for less than $6 a share, down from a high of $64 five years ago.
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