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HUMAN RESOURCE MANAGEMENT

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According to Books (2018), Elizabeth Holmes was a famous former American

businesswoman who rose to fame as the CEO of Theranos, a health technology company that

claimed its patented blood testing technology would revolutionize the medical diagnostics sector.

However, following accusations of dishonest behavior and the eventual failure of the company,

her reputation as a charismatic leader quickly faded. We will examine Elizabeth Holmes'

management style and the decisions she made in this case study, which ultimately contributed to

Theranos' demise.

Washington, D.C., was the place of Elizabeth Holmes' birth and upbringing. She was

fascinated by innovation and technology as a young child, which led her to pursue a degree in

chemical engineering at Stanford University. Her idea for Theranos, a business that would use a

unique blood testing technology to make diagnostic tests more accessible and affordable for

patients, was developed while she was a student at Stanford. At the age of 19, she left Stanford in

2003 to follow her entrepreneurial dream (Books, 2018).

The charismatic leadership style of Elizabeth Holmes was well-known. She was

frequently praised for being self-assured, motivated, and inspirational, and her speeches and

interviews helped her become a well-liked figure in the media. She was also well-known for her
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distinct voice, which was frequently likened to a robot, and her distinctive sense of style, which

included dressing in black turtlenecks like Apple co-founder Steve Jobs. Her management style

was frequently contrasted with that of Steve Jobs, and she was widely hailed as the next great

tech entrepreneur (Moran & Tebeaux, 2012).

The ability to motivate and inspire her team members was a crucial component of

Elizabeth Holmes' leadership style. She was well known for her fervent speeches in which she

would discuss her goals for Theranos and their potential to change the world. The company and

its mission were said to be highly valued by her employees, who reportedly showed great

dedication by putting in long hours and making personal sacrifices to support the business

(Moran & Tebeaux, 2012).

Elizabeth Holmes' emphasis on control has also been criticized for her management style.

Holmes was renowned for having a firm hold on information and decision-making within the

business, which reduced the autonomy of her staff. Because employees aren't encouraged to

think independently and make their own decisions, this emphasis on control can prevent an

organization from being creative or innovative. In the case of Theranos, this emphasis on control

ultimately contributed to the company's demise because employees were unable to query the

validity of the company's technology and practices (Moran & Tebeaux, 2012).

Elizabeth Holmes' emphasis on secrecy and control was another crucial aspect of her

leadership. She had a reputation for tightly guarding information about the business and its

technology and for fiercely defending the company's intellectual property. Employees were

reportedly afraid to speak up or disagree with her decisions as a result of this emphasis on

secrecy, which was said to have fostered a culture of fear within the organization.
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But ultimately, Theranos failed because of Elizabeth Holmes' management style and her

emphasis on secrecy. The validity of Theranos' technology and the accuracy of its blood tests

were questioned in a 2015 Wall Street Journal article by investigative journalist John Carreyrou.

Following this, a number of investigative articles and official investigations turned up proof of

the company's dishonest business practices.

The fact that Elizabeth Holmes had exaggerated the capabilities of the business's blood

testing technology was one of the main problems. The business had asserted that its patented

technology could carry out a variety of diagnostic procedures using only a small sample of

blood, but it was later discovered that the system was unreliable and inaccurate. Patients were at

risk and received incorrect test results as a result.

Another issue was that Elizabeth Holmes misled investors and the general public about

the company's technology. The company raised hundreds of millions of dollars from investors on

the promise of its revolutionary blood testing technology, but it was later revealed that the

technology was not yet ready for commercial use and that the company was still relying on

traditional blood testing methods for the majority of its tests.

Along with these issues, Elizabeth Holmes' emphasis on secrecy and control had bred

fear among employees. Important information about the business and its technology was kept

from investors and the general public because employees were afraid to speak out or disagree

with her decisions. This lack of accountability and transparency contributed to the failure of

Theranos.

Theranos' demise served as a warning about the dangers of charismatic leadership and the

importance of transparency and accountability in business. Elizabeth Holmes was a charismatic

leader who inspired and motivated her employees, but her emphasis on secrecy and control led to
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the company's demise. Her actions and decisions had far-reaching consequences for the

company, its employees, and its investors, and her legacy as a leader is one of caution and

lessons to be learned.

Elizabeth Holmes' leadership style can be described as autocratic, as she had a firm grip

on company information and decision-making. This leadership style can be effective in some

situations, but it can also result in a lack of transparency and accountability, as seen with

Theranos. Autocratic leaders are often highly effective in the early stages of a company because

they can make quick decisions and provide clear direction. This style of leadership, however, can

become less effective as a company grows and becomes more complex, resulting in a lack of

transparency and accountability.

A company's performance can be assessed in a number of ways, including through its

financial performance, employee satisfaction, customer satisfaction, and innovation. Theranos

was initially regarded as a very innovative and successful company, but as the scandal

surrounding the reliability of its technology emerged, the company's performance fell sharply.

Revenue, profit, and return on investment are a few examples of financial performance

metrics that are frequently used to assess a company's success. In the case of Theranos, the

business raised hundreds of millions of dollars in funding, but in the end, it was unable to fulfill

its commitments and became a well-known case of business failure. The company's financial

performance was harmed by the scandal involving the accuracy of its technology because

investors lost faith in the business and the company was forced to cease operations (Harawy,

1998).

Another crucial indicator of a company's performance is customer satisfaction, which

reveals how satisfied customers are with the company's goods and services. In the case of
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Theranos, the business made grand claims about revolutionizing the medical diagnostics sector

but ultimately had to admit that its technology was unreliable and inaccurate. Because patients

were endangered and the business's reputation was damaged, this resulted in a decline in

customer satisfaction (Harawy, 1988).

Employee satisfaction is a crucial indicator of a company's performance because it shows

how happy its staff members are with their work and the organization as a whole. Employee

satisfaction at Theranos declined as the scandal involving the company's technology's accuracy

emerged. Initially, the company's employees were motivated and inspired by Elizabeth Holmes'

charismatic leadership. Due to the company's unfulfilled promises, many employees felt betrayed

and disillusioned, and many were forced to look for new jobs as the business ceased operations

(Harawy, 1988).

Innovation is a crucial indicator of a company's performance because it reveals its

capacity to develop novel goods, services, and procedures. Theranos made claims that it would

revolutionize the medical diagnostics sector, but its technology was ultimately found to be

unreliable and inaccurate. As a result of the company being forced to cease operations and the

employees' sense of defeat and disillusionment, innovation suffered (De Zúñiga et al., 2014).

One of the most important lessons from Elizabeth Holmes' leadership is the importance

of transparency and accountability in business. Companies should be transparent about their

operations and finances, and they should be accountable to their stakeholders, which include

employees, investors, and customers. This necessitates leaders being open and honest about their

decisions, as well as being willing to admit their mistakes and accept responsibility for their

actions. Leaders who are not transparent and accountable risk jeopardizing their own and their

company's reputation, as was the case with Theranos (De Zúñiga et al., 2014).
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Another important lesson from Elizabeth Holmes' leadership is the value of having a

solid moral and ethical sense. Leaders must constantly act in their stakeholders' best interests and

follow their core values and principles. Building trust with stakeholders and fostering a positive

reputation for their business are two benefits that ethical and moral leaders can achieve. In

contrast, unethical and immoral leaders run the risk of harming both their own and their

organization's reputations, as happened with Theranos (Padilla et al., 2007).

Finally, Elizabeth Holmes' management is a lesson in the perils of charisma in business.

While charismatic leaders can be very good at inspiring and motivating their workforce, they can

also be very unpredictable and risk the safety of their organization. Transparency and

accountability should be combined with charismatic leadership, and these traits should serve as a

guide for these leaders. This will make it easier to make sure that charisma is used for the

company's and its stakeholders' interests, rather than the leader's (Padilla et al., 2007).

As the CEO of Theranos, a health technology company that aimed to revolutionize the

medical diagnostics sector, Elizabeth Holmes gained notoriety as a charismatic leader. However,

the company ultimately failed as a result of her management style, which placed a strong

emphasis on secrecy and control. She leaves behind a legacy of caution and lessons to be

learned, such as the value of openness and accountability, the necessity of having a strong moral

and ethical sense, and the perils of charisma in the workplace (Padilla et al., 2007).

In conclusion, the performance of Theranos can be measured in several ways, including

financial performance, customer satisfaction, employee satisfaction, and innovation. The firm was

initially seen as a highly successful and innovative company, but as the scandal surrounding the

accuracy of its technology emerged, the firm’s performance plummeted. The firm’s financial

performance was negatively impacted, customer satisfaction declined, employee satisfaction

plummeted, and innovation was impacted as the firm was forced to shut down operations. The
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legacy of Theranos as a firm is one of caution and lessons to be learned about the importance of

transparency, accountability, and ethical and moral principles in business.

Reference list
Books, W. (2018). Summary of Bad Blood: Secrets and Lies in a Silicon Valley Startup y John
Carreyrou (Trivia/Quiz for Fans). Cb.
De Zúñiga, H. G., Molyneux, L., & Zheng, P. (2014). Social Media, Political Expression, and

Political Participation: Panel Analysis of Lagged and Concurrent Relationships. Journal

of Communication, 64(4), 612–634. https://doi.org/10.1111/jcom.12103

Harawy, D. (1988). Situated Knowledges: The Science Question in Feminism and the Privilege

of Partial Perspective. Feminist Studies, 14(3), 575. https://doi.org/10.2307/3178066

Moran, M., & Tebeaux, E. (2012). A Bibliography of Works Published in the History of

Professional Communication from 1994–2009: Part 2. Journal of Technical Writing and

Communication, 42(1), 57–86. https://doi.org/10.2190/tw.42.1.e

Padilla, A., Hogan, R., & Kaiser, R. B. (2007). The toxic triangle: Destructive leaders,

susceptible followers, and conducive environments. Leadership Quarterly, 18(3), 176–

194. https://doi.org/10.1016/j.leaqua.2007.03.001