A relationship through which one person influence the behaviour or actions of other people.
Different Leadership Prospectives
- Command and Control
- Decision making
- Suitable for Theory X or authoritarian leadership
- Inspiring employees
- Creating a vision
- Shaping core values and culture
- Building effective teams
- Suitable for Theory Y leadership
Why Leadership is Increasingly Important in Busine
Changing organisational structures:
- Flatter hierarchy and greater delegation by giving subordinates higher jobs to do.
- Teamwork and focusing on quality assurance so everyone is in charge of quality.
- Coaching by making experienced staff train youngsters, support and empowerment.
- Change is becoming a constant feature of business life.
- Soft skills of leadership and management such as compassionate leadership are increasingly important.
- It is harder to be authoritarian in the modern era.
The Role of Strategic Leadership
- Strategic leaders are people who influence or control the corportate strategy of a business.
- Leaders control behaviour and are often personally identified with the strategy.
- This occurs in both small firms and large corporates.
How Strategic Leadership is Demonstrated
- Leaders take direct control
- Used in a crisis
- Also suits Theory X and authoritarian leaders
- Leaders set the vision and core beliefs
- The leader weighs up the options and decides
- The leader is the embodiment of the strategy but not involved on a day to day basis.
- This style sets a good example
The Difference Between Leadership and Management
- Inspire people
- Build relationships
- Take risks
- Have followers
- Enact the plan
- Use their authority
- Manage risks
- Have subordinates
Traditional Levels of Management in Business
- Set corporate objectives and strategic direction
- The board is responsible to shareholders
- For example, board of directors
- Led by the CEO
- Accountable to senior management
- Run business functions and departments
- Supervisory role and accountable to middle management
- Monitor and control day to day tasks and manage a team of workers
What a Leadership Style is
- The way that the functions of leadership are carried out.
- The way that a leader behaves.
- The focus of power is with the manager
- Communication within the business is top down and one way
- Formal systems of command and control
- Use of rewards and penalties
- Little delegation to subordinates
- McGregor Theory X approach
- Leader decides what is best for employees
- Links with Mayo in the sense that it addresses employee needs
- Akin to a parent-child relationship
- Little delegation
- Softer form of authoritarian leadership
- Focus of power is more with the group as a whole
- Leadership functions are shared within the group
- Employees have greater involvement within decision making
- Emphasis on delegation and consultation
- Leader has little input into day to day decision making
- Conscious decision to delegate power
- Managers and employees have freedom to do what they think is best
- Effective when staff are ready and willing to take on responsibility
- Not the same as abdication
Grouped managers into 2 types:
Theory X - Authoritarian
The average worker is lazy and dislikes work. Workers need to be controlled and directed. There is centralised organisation and exercise of authority.
Theory Y - Laissez Faire
Most people enjoy work and workers will take responsibility and organise themselves. Decision making can be delegated.
Why Modern Businesses Are Moving Away From Authori
- Change in society's values
- Better educated workforce
- Focus on the need for soft human resource skills
- Changing workplace organisation
- Greater workplace legislation
- Pressure for greater employee involvement
Tannenbaum and Schmidt
- A "continuum" of leadership behaviour
- The continuum represents a range of action related to:
- The degree of authority used by the manager
- The area of freedom available to non managers
- Links with both Theory X and Theory Y leadership
Tannenbaum and Schmidt Continuum
Blake Mouton Managerial Grid
- Identifies five different leadership styles based on a grid
- Axis measure:
- Y axis - Concern for people
- X axis - Concern for completing tasks
The Leadership Styles
Factors Affecting Leadership Styles
- Personal value systems
- Manager's experience
- Confidence in subordinates
- Feelings of security
- Nature of business problems
- Type of organisations (size, structure, etc)
- Effectiveness of teams and groups
- Skills and experience of subordinates
- Pressure (time, costs, etc)
Which Leadership Style is Best?
- A business needs the right leader for the right situation.
- Autocratic is suitable when the business is in trouble, for example, if it needs rapid turnaround.
- Autocratic would be inappropriate if the perforance is highly dependent on effective team working and decentralised operation.
- Stage of business: start up vs established and complex.