Question

Case study: The Good, the Bad and the Ugly - A Story of Vadym Hetman As CEO of Avani International, Hetman headed the growth of a corporate giant. At its peak, Avani was gobbling up 200 companies a year. Under his leadership, the value of Avani increased 70-fold. In 2011, Hetman proclaimed his desire to be remembered as the world greatest business executive. Things turn sour when Hetman and his former chief financial officer were accused of running criminal enterprise within Avani. The two were charged stealing $170 million directly from the company and pocketing an additional $450 million through manipulated sales of stock. Hetman’s action has almost destroyed the company where he worked for 25 years. In 2012 alone the value of the company’s stock dropped $90 billion. Hetman spent his early years in humble circumstances. He grew up in the 1960’s in Jackson, Alabama. He said he was the son of a cop. It was only after he was accused did it come out that his father was never a police officer in Jackson or anywhere else. However, his mother did work for the Jackson Police Department as a school crossing guard. His father, in actuality, was a wheeler-dealer who was a practiced deceiver and an effective persuader. He had a strong personality but for the most part kept his misdeeds to little white lies. Friends remember Hetman as an easygoing kid who did well in school without trying very hard. He was elected “class politician” by high school graduating class. He went on to Samford, paying his way to college by playing guitar in a band. He served in Bangkok held a few accounting job, and eventually joined Avani in 1980s. Over the course of the 1990s, Hetman’s happy-go-lucky character disappeared. As he climbed the ladder at Avani, he became a corporate tough guy, both respected and feared. He eventually became CEO in 2001 and administered the rapid expansion of the company. Meanwhile, Hetman learned to live big. He had a $18 million apartment in Los Angeles, a $35 million mansion in Georgia, and a $20 million yacht. He spent $25 million on art for his luxury homes. He took extravagance to the extreme, for instance, spending $5, 000 on a shower curtain. The more he made, the more he spent, and the more he allegedly stole. Although his total compensation was $160 million in 2008, it wasn’t enough. He manipulated the company’s relocation fund and Employee Loan Program to take hundreds of millions in interest-free funds. In 2010 for instance, he gave his wife $1.5 million to start a restaurant, spent $2 million on birthday party in the Hawaii Island for his wife, and gave away $50 million in corporate funds to make humanitarian contributions in his own name. (Source: Adapted from Stephen, P. Robbins, “Organizational Behavior”, 2005)


1 Based on the case study:

(a) Examine Hetman’s personality trait.

(b) Discuss how Hetman’s past shaped his personality

(c) Based on your answer in (a). Discuss two (2) character traits that might influence Hetman’s behaviour and performance at work.

(d) Discuss two (2) factors present in the case study that most likely influence Hetman’s perception of achievement.

(e) Which motivation theory do you think best explains Hetman’s behaviour and work performance? Justify your answer.

(f) “Hetman just did what anybody would do if they had the chance. The people at fault in this case are Avani’s Board of Directors for not controlling their CEO”. Do you agree or disagree with this statement? Discuss your answer based on the characteristics of effective team.

(g) Discuss what Avani International should do if symptoms of groupthink exist in the company.

Answer 1

Q1-

a) Hetman's personality trait is of Conscientiousness, as he was climbing up the ladder of success in the organization, he became more focused on achieving his targets, and for that he carefully planned to stole money on various accounts from the organization.

b)Hetman's father was a deceiver and persuaded and from childhood itself, he had seen his father deceiving people, which had an impact on his personality. He had seen his father hiding his wrongdoings under white lies. When he grew up and tasted success, he also applied the same thing and started to steal money and tried to hide his wrongdoing under several lies.

c) The two characters are

1. Achievement-oriented-He was very goal /target-oriented, which helped to achieve both successes as well as in his illegal activities. He had planned how he will steal the money from the company without being caught.

2. Methodological- He was a great planner and methodologically advance his career and treachery. He was not messy, he planned and prepare a method to advance in his plan.

d) His easygoing nature and achieving success without much effort and happy go lucky character present in the case study that most likely influence Hetman’s perception of achievement.

f) Yes, I do agree with this statement, the board of directors must have watched his activities and should have caught him red-handed had they been unitedly worked towards the achievement of their team's goal.

g) they should have thought how could a CEO with such a payment lead such a lavish lifestyle with his salary and not so influential family background.

e)McClelland’s theory of needs could have influenced him in doing all these fraudulent activities.