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Management and

leadership
CHAPTER 6
Chapter Overview

 Examine
 The roles of leaders and managers within businesses and how they differ
 The functions of management
 The qualities of a good leader and the different leadership styles that exist
 The nature of emotional intelligence and Goleman’s four competencies
Leaders and 6.1
managers
Managers

 What is a manager?
 A manger is someone who gets things done
 Tend to focus on the present and short term and are responsible for
implementing decisions of others
 They manage but also follow
 Their role is to maintain things the way they are currently within the business
Leaders

 What is a leader?
 Leaders are followed
 They have a visions and a clear sense of where they are taking the business
 Willing to go against business norms (shake things up)
 They motivate others to act in particular ways
 Often brought in to make significant changes to the business
Key terms

 Authority is the power or ability to carry through a task or action

 Leadership includes the functions of ruling, guiding and inspiring other


people within an organization in pursuit of agreed objectives

 Management is planning, organizing, directing and controlling all or part


of a business enterprise
Management 6.2
and managers
Management and Managers

 What is management?
 Four basic functions of management:
 Planning
 Organizing
 Directing
 Controlling
Case Study: Telenor and its Indian operations

1. Explain the difference between the roles of the leader of Telenor (the
Chief Executive) and the company’s managers.
The leader should understand where s/he wants to take the business, provide a
clear direction, and motivate and inspire others.
Managers should master the art of getting things done through other people—
involving planning, organizing, directing, and controlling.
2. Evaluate which of the functions of management will be most important if
Telenor’s managers are to respond effectively to the opportunities
resulting from its successful bids for new licenses.
Plan how to raise finance and provide services
Organize and assemble necessary resources
Direct large number of employees to ensure effective communications
Control is vital once service is provided to ensure demands/conditions are met
Planning

 The foundation of all management and business principals


 Requires the management to evaluate where the business currently is and
where the business needs to go in the future
 Establish objectives and targets for the business
 Forecast key data such as costs and revenue
 Planning for departments of the business such as human resources,
marketing and finance departments
 Estimating the resources that will be needed in the future
 Contingency plans: How will you overcome an emergency?
Organizing

 Management must assemble the resources that they need to carry out
actions that they set out in the plan

 Determine the internal organization structure and maintain relationships


and allocate resources
Directing

 Influence and oversee the behavior of the staff in achieving the


companies goals

 Motivation is the willingness to achieve a target or goal

 Communication exchange of information between one or more people


 One of the most important aspects of management!
 Always think about lines of communication within your business. Billions of dollars
are lost every year because of poor communication
Controlling

 Setting standards using the companies objectives, and evaluating and


reporting performance

 Financial reports investors can compare companies and the government


can check and make sure the business is paying taxes

 Employee performance includes productivity reports, levels of


absenteeism etc.

 Social performance ethical behavior, minimizing pollution and creating


jobs
Mintzberg’s roles of management

 Henry Mintzberg is a professor that specializes in management


 He argues management is not about functions but about what managers
do
 His most famous theory is managers perform 10 roles that fall into 3
categories
 Interpersonal management
 Informational management
 Decisional management
Mintzberg’s Roles of Management

Role Category
1. Figurehead
2. Leader Interpersonal management
3. Liaison
4. Monitor
5. Disseminator Informational management
6. Spokesperson
7. Entrepreneur Decisional management.
8. Disturbance Handler This category of
9. Resource Allocator management role uses
10. Negotiator information to take decisions
Interpersonal Management

The managerial roles in this category involve providing information and ideas.
 Figureheads – As a manager, you have social, ceremonial and legal
responsibilities. You're expected to be a source of inspiration. People look
up to you as a person with authority, and as a figurehead.
 Leaders – This is where you provide leadership for your team, develop
junior employees; and it's where you manage the performance and
responsibilities of everyone in the group.
 Liaison – Managers must communicate with internal and external
contacts. You need to be able to network effectively on behalf of your
organization.
Informational Management

The managerial roles in this category involve processing information.


 Monitor – In this role, you regularly seek out information related to your
organization and industry, looking for relevant changes in the environment.
You also monitor your team, in terms of both their productivity, and their
well-being.
 Disseminator – This is where you communicate potentially useful
information to your colleagues and your team.
 Spokesperson – Managers represent and speak for their organization. In
this role you're responsible for transmitting information about your
organization and its goals to the people outside it.
Decisional Management

The managerial roles in this category involve using information.


 Entrepreneur – As a manager, you create and control change within the
organization. This means solving problems, generating new ideas, and
implementing them.
 Disturbance Handler – When an organization or team hits an unexpected
roadblock, it's the manager who must take charge. You also need to help
mediate disputes within it.
 Resource Allocator – You'll also need to determine where organizational
resources are best applied. This involves allocating funding, as well as assigning
staff and other organizational resources.
 Negotiator – You may be needed to take part in, and direct, important
negotiations within your team, department, or organization.
Case Study: Garuda Indonesia plans to double fleet

Explain why planning has been an important function for Garuda Indonesia’s
managers over recent years.
The company is growing quickly (from 92 aircraft in 2013 to 194 in 2015). It will
have had to plan the routes, financing of expansion, and employment
recruitment. The market is changing significantly and the company has to plan
responses (open-sky policy, etc.)
This expansion represents a major challenge for Garuda Indonesia’s managers.
Evaluate which of Mintzberg’s roles would be most important in the management
of the company’s growth.
Interpersonal roles would be vital to provide inspiration, direction, and effective
communication. Informational roles will play a part in collecting and evaluating
the data. Decisional roles to deal with unexpected developments and
negotiations.
Mintzberg’s Conclusion

 Senior managers have heavy workloads and little free time


 Managers work on many different tasks
 80% of results usually come from 20% of the effort
 Managers often focus on short-term immediate problems
 Verbal communication is preferred to written
 Managers seldom get out and about which doesn’t make them visible to
other employees
 Managers often control very little of their every day activity.
The Perfect Boss: Dr. Axel Zein at
TEDxStuttgart

 Axel Zein promotes a new way to manage businesses today: think of


business as a sport

 In sports, the team is decisive; the team with the best players usually wins.
And sports are fun. So what qualifies a manager to be the perfect coach
for his team?
Leadership 6.3
The Purpose of Leadership

 Leaders provide the vision that takes a business forward


 Decide objectives for the organization
 Provide expertise and setting standards for the organization
 Determine the structure of the organization (i.e. Hierarchies and spans of
control)
 Become role models for individuals within the organization
 Leadership is always changing and depends on:
 Resources available
 Employees understanding the need for change
 Support from other senior managers
Directors

 Proposed by the CEO of a company and elected by shareholders


 Largely strategic (i.e. setting and overseeing the achievement of long-
term goals)
 Directors can be:
 executive (employed by the company in a senior capacity)
 non-executive (not employed)
 independent (not employed)
Managers

 Managers carry out a range of duties (planning, organizing, motivating


and controlling)

 Have authority over junior employees and plan and monitor short-medium
term strategies for the business
Case Study: Trina Solar Appoints Non-
Executive Director

Mr. Chow has been a manager and a director at IBM. Explain the main
differences between those two roles.
Managers carry out a range of duties (i.e. planning, organizing, motivating,
controlling), have authority over junior employees, and plan and monitor short
to medium term strategies.
Directors are proposed by the CEO and take up the role if they are
elected by shareholders. This role is largely strategic (i.e. set and oversee the
achievement of long-term goals).
Case Study: Trina Solar Appoints Non-
Executive Director

Discuss the key benefits that you think Trina Solar Ltd will gain as a result of Mr.
Chow’s appointment.
Mr. Chow has a wide range of experience in various senior roles which
helped him develop a range of skills. This experience will help him guide and
advise the board of directors
Chow’s work in different roles will have given him a large number of
contacts in the tech industry. He may be able to pass on these connections
to be used by directors and managers
The company will gain benefits from publicizing this appointment. This may
persuade investors and suppliers to work with Trina Solar.
He offers experience in making strategic decisions which will have a major
influence on future performance of the company.
Supervisors

 Represent a link between managers and the business’s shop-floor workers


 They are the first line of managers
 Responsible for day to day issues (i.e. staffing, tactics for meeting
deadlines, etc.)
Worker Representatives

 Chosen by their fellow employees or appointed by management

 Their roles include:


1. Receiving information from and giving it to management teams (i.e. pay,
conditions, expansion, etc.)
2. Passing information on to all employees within that workforce
3. Consulted by management about impacts to the workplace (i.e. new
tech)
Qualities of a Good Leader

 What do you think makes a good leader?

 Has the general view of a good leader changed over recent years?

 Check table 6.3


Case Study: What To Look For In A Top
CEO

Explain two key tasks of a leader of a large multinational company.


Leaders establish a sense of direction and establish objectives to move the
company towards its aims (especially important in a large multinational co.).
Without effective leadership the company’s managers may not make
coordinated decisions.
The leader plays a key role in determining the structure of the organization
(hierarchies and spans of control, lines of communication, culture).
Case Study: What To Look For In A Top
CEO

Discuss the possible reasons why these experienced and successful CEOs
have different views on the qualities needed for a successful leader.
Because of their different backgrounds and experiences.
Leaders have different views on their roles (i.e. believing possessing
interpersonal skills and humor are vital components vs guidance toward
strong financial performances).
Leaders have different views on what is the key component (shaped by
their character and experiences).
Ted Talk: Roselinde Torres: What it
takes to be a great leader

 There are many leadership programs available today, from 1-day


workshops to corporate training programs

 But chances are, these won't really help

 Roselinde Torres describes 25 years observing truly great leaders at work,


and shares the three simple but crucial questions would-be company
chiefs need to ask to thrive in the future

 What are the three questions?


Styles of 6.4
leadership
Trait Theory

 Many writers argue: If you have good leadership traits you will be a good
leader

 Traits commonly mentioned:


 Being informed and knowledgeable
 Having the ability to think creatively and innovatively
 Possessing inner motivation and the desire to achieve
 Having the ability to act quickly and decisively
 Projecting an air of authority

 Has decreased in popularity recently because leaders have demonstrated


different traits
Behavioral Theories

 Focuses on how a leader behaves; trying to identify the right way of


leading rather than what a leader is like as a person.

 Considers the extent leaders “listen to” or “tell to” their staff

 Classified as:
 Autocratic
 Democratic
 Laissez-faire

 A key factor in differentiating between styles is communication


Behavioral Theories

 Focuses on how a leader behaves; trying to identify the right way of leading rather than
what a leader is like as a person.

 Considers the extent leaders “listen to” or “tell to” their staff

 Classified as:
 Autocratic
 Democratic
 Laissez-faire

 A key factor in differentiating between styles is communication


Autocratic Leadership

 Assumes that information/decision-making are best kept at the top.


 One-way communication (downward)
 Minimal delegation or decentralization
 Close supervision of employees

 Can face difficulties:


 People avoid making decisions
 Senior managers often overworked
 Staff turnover usually higher than industry standards
Democratic Leadership

 Operating a business according to decisions agreed by the majority


 Democratic leadership encourages:
 The leader to delegate a great deal and encourages decentralization
 The leader and subordinates discuss issues and employee participation is
actively encouraged
 The leader acts upon advice, and explains the reasons for decisions
 Subordinates have greater control over their own working lives
Democratic Leadership

 Delegation means passing authority down the organizational hierarchy.


This is only genuine if the manager relinquishes some control to the
subordinate.

 Starting to trend towards democratic leadership because:


 People are more likely to be motivated and productive
 Globalization means businesses are larger and more complex
 Global markets are more dynamic and subject to rapid change
 Individuals more likely to need support to succeed
Case Study: Richard Branson Assesses Steve Jobs

1. Explain the key features of an autocratic leader, such as Steve Jobs.


It is a leadership or management style that assumes that information and decision-
making are best kept at the top of the organization; communication goes
downward; minimal delegation; close supervision of employees; some allow for the
possibility of discussion
2. To what extent is being a good communicator, or being passionate
about the business, more important than the leadership style adopted by
a leader?
Being a good communicator is vital to ensure leader’s vision is understood by
employees; Being passionate assists in winning over stakeholders and persuading
support; May fail if use an inappropriate style; Should adjust style based on
circumstances
Laissez-faire Leadership

 Sometimes described as mild anarchy

 Employees take majority of decisions

 As a result, the organization may lack sense of direction, coordination, and


planning

 May occur due to leader’s shortcomings

 May be a brave policy decision to allow staff to express themselves


Laissez-faire Leadership

 May be successful if:


 The manager or leader is among a number of equals in terms of experience and
qualifications
 The workforce is self-motivated and understands the role of managers
 The workforce understand and agrees with the organizations objectives

 Tends to result in highly independent employees


Now It’s Your Turn

 In pairs, find two examples of autocratic, democratic, and laissez-faire


leadership
Style Versatility

 Possible to argue that the best managers are those that adopt multiple
styles depending on the circumstances

 Might adopt a democratic approach when reaching a decision on a


proposed marketing campaign, but be autocratic in dealing with a crisis
What Do You Do?

 You are a leader who has just made an important decision.


 As you had responsibility for the decision, you made it on your own
 Someone has just come and told you some important information that you did
not know because you did not ask anyone any questions before you made the
decision
 As a result you now know that you have made the wrong decision
 What do you do?
What Do You Do?

 You lead a group of young people in your community that is successful


and growing.
 You listen to the young people and include their ideas in your activities.
 Someone you respect has told you that you need to 'lay down the law' when
you lead because he has noticed that the meetings can be noisy.
 What do you do?
Project

 Film and edit a video that shows the three management styles discussed
and explains when they would be most appropriately employed.
Douglas McGregor’s Theory X and
Theory Y

 Douglas McGregor was an American social psychologist who researched


management within in large organizations

 How a leader’s attitude shapes his/her behavior

 His research highlighted two types of leaders


Douglas McGregor’s Theory X and
Theory Y

 Douglas McGregor was an American social psychologist who researched


management within in large organizations
 How a leader’s attitude shapes his/her behavior
 His research highlighted two types of leaders
Theory X

 Assumes workers motivated solely by money and have no real desire to


work
 Therefore most people must be forced with the threat of punishment to
work towards organizational objectives
 The average person prefers to be directed; to avoid responsibility; is
relatively unambitious, and wants security (money) above all else
 To get the best from employees, use piece-rate pay and close supervision
 Piece-rate pay is a system under which employees’ wages are determined
by the quantity of products produced.
 China, India, and Bangladesh are good examples of countries where you see
this
Theory Y

 Believe:
 Workers seek satisfaction from work, not just a paycheck
 Workers possess knowledge, creativity, and imagination
 Workers willingly commit themselves to organizational objectives
 Poor performance by employees is due to repetitive and monotonous work or
poor management
 Employees wish to contribute to decision-making
Theory Y

 Focuses on meeting social and psychological needs of individuals


 If leaders adopt Theory Y, the implications can be significant and possibly
include:
 Greater delegation allowing lower-level employees greater authority
 Training for managers to encourage delegation and improve communication
 Reviewing company culture to discourage managers from retaining what they
might see as their “authority”
 Considering organization’s structure
 Businesses moving toward Theory Y require planning, support of managers
and shop-floor workers, and considerable training
McGregor’s Arguments

 Came to the conclusion the behavior of employees is often the result of


how they are treated

 Business culture
 (Theory Y) is the attitudes, values and beliefs that normally exist within an
organization are important

 Communication
 Is the exchange of information or ideas between two or more parties
 Theory Y shows an increase in communication within the business
Leadership Styles Review

 Trait theory suggests leaders should have certain characteristics to be


successful

 Behavioural theories categorize leaders:


 Autocratic leaders
 Democratic leaders
 Laissez-faire leaders
 Style versatile leaders

 Douglas McGregor classified leaders as:


 Theory X or Theory Y according to their views of employees
Management
6.5
Leadership Styles Activity

 Listed below are some scenarios of different leadership styles. Determine


what style is being used, and then discuss if it is correct for the situation or if
a different style would work better.
1. A business major is leading a team of research scientists working on new ways to use
plastic. Although the team discusses the merits of each idea and project, she retains
the final decision making authority.
2. A new supervisor has just been put in charge of the production line. He immediately
starts by telling the crew what changes need to be made. When some suggestions
are made, he tells them he does not have time to consider them.
3. A construction crew has worked together for the last four years with very little
change-over in personnel. They always vote whenever a decision has to be made
on how to proceed with the project.
Leadership Styles Activity

4. The owner of a small electronic store starts every day by telling the three employees
what has to be done and how to do it.
5. A construction crew has worked together for the last four years with very little
change-over in personnel. They always vote whenever a decision has to be made
on how to proceed with the project.
6. A new squad leader is just assigned overseas. She immediately calls her squad
together for a meeting and asks for their ideas and input on an upcoming field
training exercise.
7. There are seven people on a special project team and each individual is from a
different department. Although a leader was elected, for a decision to pass it must
have the approval of each individual.
Leadership Styles Activity

8. A small department performs the same functions every day. To get


information out, the supervisor sends it by email or voice mail, very rarely is
a meeting called.
9. A forklift has its forks raised in the air to put some material in the racks. An
employee darts under the forks (safety violation) so he can get back to his
workstation in time. The supervisor tells him very sternly not to ever do that
again and notes it in his log.
10. A project is running late. The manager puts out a course of action to take
to try to put it back on track. Later that week she calls a meeting of all
supervisors and key players to create a strategy to keep the project
running on schedule.
11. A manager is working on the budget. He is told to get a hot project
running immediately. He calls his staff together and explains the project.
He then tells them to get it up and going while he completes the budget.
Leadership Styles Activity

Consider the following when answering the questions:


 Did the style work?
 Could a different style have worked better?
 How did you feel about the decision?
 Did everyone learn from that style and what did they learn?
 Which style is easiest to use and why?
 Which style do you prefer the leaders over you to use and why?

1. Think of a time when you or another leader used the autocratic style of leadership.
2. Think of a time when you or another leader used the democratic style of leadership.
3. Think of a time when you or another leader used the laissez-faire style of leadership.
Emotional 6.5
intelligence
Emotional Intelligence (EQ)

 Emotional Intelligence is the capacity for:


 Recognizing our own feelings and those of others
 Motivating ourselves
 Managing emotions in ourselves and in our relationships
Emotional Intelligence (EQ)

 EQ model emphasizes that there are areas of emotional intelligence that


determine how well employees will perform

 People with a high IQ are not automatically good performers in the


workplace

 However low IQ predicts low performance


Goleman’s 18 EI Competencies

 Daniel Goleman’s work evolved to produce a model of 18 personal


competencies grouped into four clusters
Goleman’s 18 EI Competencies
Emotional Intelligence and Business

 Leaders have to be able to motivate and inspire others, establish good


relationships and manage conflicts between subordinate employees

 Research shows that exceptional leaders and managers possess a range


of emotional competencies both personal and social
Emotional Intelligence and Business

 EI is increasingly becoming more important and is providing a new way to


understand and assess people’s:
 behavior
 leadership styles
 attitudes
 interpersonal skills
 and most importantly, their potential performance

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