Case Study: Tyco International: Leadership Crisis

1665 words 7 pages
Case Study: Tyco International: Leadership Crisis

Case Study: Tyco International: Leadership Crisis
Gupta Bhagirath, BUS604
Grand Canyon University


Tyco International Ltd. NYSE: TYC is a highly diversified global manufacturing company incorporated in Switzerland, with United States operational headquarters in Princeton, New Jersey (Tyco International (US) Inc.). Tyco International is composed of five major business segments: ADT Worldwide, Fire Protection Services, Safety Products, Flow Control and Electrical and Metal Products. This case study describes the Leadership crisis faced by Tyco International and its rebuilding an empire again.
In 2001, Dennis Kozlowski, chairman and CEO of Tyco International, was identified by
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He fired 290 of the company's top 300 executives. Then he turned around and fired the board that had just hired him. He closed Tyco's posh Manhattan offices and moved to West Windsor, N.J. He ordered consolidations throughout the company, paid down debt and, lately, has begun to focus on growth rather than simple survival. Breen told his audience that the courage to make decisions -- right or wrong -- along with the talent to both cut expenses and increase revenues are the hallmarks of a great chief executive. Today he manages a company with $40 billion in revenues and 250,000 employees worldwide. Tyco operates five main businesses: Fire and Security, including the ADT brand, electronics, healthcare, engineered products and services, and plastics and adhesives.
So, yes the new leadership has demonstrated that they have learned from their history and have set up procedures to avoid some of the problems of the past. For example, shareholders elected a completely new board of directors and voted to make future executive severance agreements subject to share holder approval. They also voted to require the chairman of the board to be an independent person, rather than a Tyco CEO.
5. What other actions should the company take to demonstrate that it intends to play by the rules?
Adopt policies that address conflict of interest and provide training to all staff and the board of directors. Define roles and responsibility clearly and followed all the govt. rules for doing