A Strong Contemporary Leaders Research: Martha Stewart (Essay Sample)

Martha Stewart
Martha Stewart
The personalities of strong business leaders are the virtual icons for their corporate brand, which are capable of shaping and increasing corporate image and placing personal prestige to the brand. At the same time, there is a risk of threating the brand when leaders are involved in the scandals and the consequences of which are critical to be brand (Cheng, 2011). Thus, Martha Stewart, an icon of domestic advice, entertainment and home products, the voice of the brand and a well-known and much admired designer of home supplies, was involved in the insider trading scandal, with the following accusations in stock price manipulation and perjury during the government investigation. As the result, the good name of brand has been tarnished, the status of her as the director has been imperiled and the social life of Martha herself was damaged. Moreover, the scandal where Stewart was involved has raised an issue about the franchise of this business woman, the business strategy as it was and personal misconduct, which interlocked the nature of Stewart’s business to be risky and vulnerable (O’Rourke, 2004).
Starting as the CEO for small catering business Martha Stewart Living Omnimedia, Stewart has eventually transformed her name into the homemaking diva with stylish living and as a good taste promoter with various connections in housewares, television shows, radio channels and magazines. However, as stated (Cheng, 2011), no business or the organization can be sure in avoiding crisis events and no matter how large or small the organization is, it has the potential to become the victim of such crisis. So when Stewart, a holder of stock at ImClone, the bio-pharmaceutical company, made a decision to place a sell order on her entire holdings after pre-existing agreement with her broker, it spurred a chain reaction of unprecedented events, which caused Martha Stewart her position in Omnimedia and damaged the overall image of the business woman with the several months jailing. While Stewart claimed that the sales decision was proper and in accordance to the law, the investigations became the concerns of three institutions at once, the U.S. Department of Justice, the Securities and Exchange Commission and the U.S. House of Representatives Committee on Energy and Commerce. In case of Stewart to be found fully guilty, then she would be sentenced to five years for the possibility of obstruction of justice and ten years for securities fraud. In addition, one of the shareholders of Martha Stewart Living Omnimedia sued her for selling stock before the public investigation of ImClone situation and some of the executives made a class action lawsuit due to Stewart personal conduct (O’Rourke, 2004).
Starting from the day of accusations, Martha Stewart was trying gamely to defend herself on television and through public statements. She also launched numerous interviews, where she tried to prove that the accusations were false, but her public image being one of trustworthiness, fine, and Stewart herself was a fine editor and fine business woman. Despite that, Omnimedia had faced legal problems due to scandal. They were associated with the advertising sales to become flat, retailers were not wishing to purchase products and the company was suffering from such unanticipated costs as additional lawyers and public relations specialists. Finally, Stewart agreed that the investigation cost her money but also some new business opportunities, which were lost. However, during the indictment process, Martha Stewart was protected by the criminal lawyer Morvillo, who followed the strategy of attacking the accusers and suggested that Stewart appeared to be the target for the prosecutors on account of her fame. Moreover, Stewart did not leave her company in spite of mass considerations, but she remained on the board of directors and became a force of company’s chief creative officer and later as the creative adviser for the sake of company’s and shareholders’ interests.
The campaign in restoring of her public image has started before the official verdict. When the verdict was known and Martha Stewart was sentenced, the new advantage of the situation appeared. Here Stewart thanked to more than hundred and seventy thousand people for support and defense and took an opportunity to immediately promote the Martha Stewart Living Omnimedia Company as the way to support its subscribing and buying possibilities, thus encouraging advertisers to come back. In addition, at the same day of being indicted, Stewart took another opportunity in restoring her image. It was made through laun...