VECTOR AEROMOTIVE CORPORATION CASE STUDY SOLUTION

Possibly in hopes of shifting the power back in his favor. Previous Post George W. He was even so inclined to add another board member, also another one of his long-time business associates, when he did experience a little resistance with the other board members. The board members should also have been required to sign a conflict of interest statement, saying that they would only act in the best interest of the business and not profit from his or her service on a board of directors, placing the company in jeopardy as Wiegart placed Vector in jeopardy. They never confronted him formally about his poor management or ill-fated decisions and the board will now have a hard time firing him and not receive some form of legal action taken against them. This is a clear example of how the board members chose to ignore other poor actions made by Wiegart in the years that followed. The board members should have made sure that they were receiving all the information needed prior to the meeting with the Vector executives so that they were able to make solid informed decisions on behalf of the stakeholders and potential investors.

In the meantime, Wiegart continues trying to sell his fabricated business plan with potential investors, losing their trust, and burying the company in a huge financial deficit. Wiegart was not only losing the trust of his board members and employees but also his potential investors. The board would finally acknowledge this was a rather large issue two years later. Generally, the board of directors are responsible for the following duties: The board members should have made sure that they were receiving all the information needed prior to the meeting with the Vector executives so that they were able to make solid informed decisions on behalf of the stakeholders and potential investors.

However, the first initial mistake was the president and founder of the company appointing himself as the chair of the board.

Vector Aeromotive Corporation Case Study

Another problem, not mentioned in the case, was the board members themselves. A background in real estate would not benefit someone needing knowledge of the exotic sports car industry as in the case of Wiegart selecting Barry Rosengrant as a board member. Possibly in hopes of shifting the power back in his favor. Following this addition, one of the members resigned because Wiegart deliberately lied to the members stating that the investor insisted on there only being four board members.

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This is a clear example of how the board members chose to ignore other poor actions made by Wiegart in the years that followed.

The amount of excessive spending that the president was responsible for was noticed as a problem but no action was taken. Press enter to begin your search.

vector aeromotive corporation case study solution

The board members did not challenge Wiegart and try to take control of the situation until the financial position of the company was in dire straits and it was, in a sense, too late.

How about receiving a customized one? They were all selected by the founder and president of the corporation, with the exception of Baduraman Dorpi he was appointed by the Indonesian ckrporation per the purchase agreement. Generally, the board of directors are responsible for the following duties: They never confronted him formally about his poor management or ill-fated decisions and the board will now have a hard time firing corpotation and not receive some form of legal action taken against them.

vector aeromotive corporation case study solution

The board members rarely received information prior to their meetings and what information they did receive, just enough was given in order for Wiegart to achieve the conclusion that he wanted. Previous Post George W.

The only board member that was not personally selected by Wiegart was Dorpi as I mentioned earlierwho was appointed by the Indonesian investor as indicated in the purchase agreement he had with Vector. The board members should also have been required to sign a conflict of interest statement, saying that they would only act in the best interest of the business and not profit from his or her service on a board of directors, placing the company in jeopardy as Wiegart placed Vector in jeopardy.

The most obvious one is a law set in place that does not allow the president and the board member to be one in the same. There were many possible ways in which this could have had a much more favorable outcome.

Would you like to get a custom essay? There was a clear conflict of interest having the president of Vector not only residing as the board chairman but also the individual responsible for selecting the board members.

He will have a difficult time achieving success with a bad reputation of trying to deceive potential investors and withholding valuable decision making information from board of directors.

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The board members should only be selected by the investors and should have knowledge and management experience in relation to the business it is a board of. Army Risk VS hazard. The board members should have made sure that they were receiving all the information needed prior to the meeting with the Vector executives so that they were able to make solid informed decisions on behalf silution the stakeholders and potential investors.

The board members also failed to notice As mentioned in the class textbook, board members have two main soolution responsibilities. None of the decisions the board made were in the interests of the investors rather they were made in the interest of keeping a feeling of cohesiveness within the company.

There should have also been an uneven number of board members, to avoid ties when making decisions. The board would finally acknowledge this was a rather large issue two years later. Wiegart was not only losing the trust of his board members and employees but also his potential investors. President Wiegart had a great business concept and might have done very well had there been laws in place to dictate the proper duty of care, loyalty, good faith and avoiding deliberate destruction of shareholder value.

Another solution would have been for the board members to evaluate each other and the group as a whole to ensure their performance level was up to par and assess improvements that could have been made.

In conclusion, Vector Aeromotive Corporation has doomed for failure with the initial set up of the board of directors. However, if Wiegart was to make a comeback with Vector sloution might want to think about acquiring some management skills as well as business ethics.

In the meantime, Wiegart continues trying to sell his fabricated business plan with potential investors, losing their trust, and burying the company in a huge financial deficit. He was even so inclined to add another board member, also another one of his long-time business associates, when he vfctor experience a little resistance with the other board members.