Module Strategic International Business Management
Title of Assignment People Management
Word limit 3000 words (+ / – 10%)
Details of the Assignment Organisational success in multi-national companies is dependent upon effective and appropriate leadership. Prepare a report that Identifies and explains three different leadership styles and critically evaluate the differences between them.
Work should be underpinned by theory, examples and supported by extensive references. Students should use the readings and many web sources provided as well as the material to which reference has been made in the lectures. Your own supported synthesis and interpretation should be offered.
Learning Outcomes to be assessed
This assessment assesses how well you can do the following (as outlined in the module specification):
• Understand and critically evaluate theories of leadership, motivation and change management and their effective implementation in an international context.
• Understand and critically evaluate theories of managing diversity and their effective implementation in a cross-cultural context.
• Promote a professional and ethical approach to organisations.
Key Skills to be practiced / assessed
This assessment assesses how well you can do the following (as outlined in the module specification):
• Enhance and apply planning, organizing, decision-making and time management skills appropriate for use in an organisational context.
• Experiment and develop personal initiative and responsibility in undertaking complex investigations in the solving of organisational problems and issues.
• Critically analyse and apply key ideas and concepts via comprehensive research relevant both to the subject area and to professional practice in the field.
• Use terminology associated with the subject area accurately and in a way, which demonstrates sophisticated knowledge and understanding.
• Develop and enhance both individually and collaboratively effective written and oral communication skills for both specialist and non-specialist audiences.
Assessment criteria Your assessment will be assessed according to these criteria which are reflected in the Assessment Feedback Sheet:
• Degree of knowledge and understanding of the module subject
• Ability to develop an argument which is clearly justified and relevant to the particular circumstances of the situation under consideration
• Ability to develop an argument which is well structured
• Breadth and depth of reading from the relevant academic literature
• Ability to critically synthesise and apply relevant theories and concepts from a range of sources
• Ability to apply the Harvard referencing system in the correct manner
• Ability to collect and analyse relevant data
• Ability to identify and evaluate a range of strategic options relevant to the particular circumstances of the situation under consideration
• Degree of originality in generating relevant and justified solutions to the business problem under consideration
• Professionalism of presentation
• Ability to manage time to submit by the deadline
• Academic good conduct
For any business to be successful, several factors that have to be put into consideration. Most people will tend to think that a sound business plan and strategy are all the requirements of a successful business (Business leadership, 2008). One of the main areas that dictate the failure and success of an organization is leadership. Leadership steers the team in the right direction by the set targets (Mumford, 2010). Leaders are people that the worker looks up to and hence they must be highly qualified and capable of handling the mandate of the organization as well as ensuring the staff is well motivated. Many organizations today operate in a multinational environment and hence leaders must know how to deal with people from different cultural and religious backgrounds (Business leadership, 2008). Globalization has called for leaders who can associate well with people from all walks of life, and this paper will look at different leadership styles that are employed in these organizations.
A leadership style is an approach used by management to provide directions as well as motivating the staff to work towards the goals of an organization. The employees view leadership style as the implicit and explicit actions that a leader performs in the group. The earliest studies on the style of leadership were performed by Kurt Lewin in 1939 when he led a team of researchers to study and identify the methods (“Leadership Styles,” 2016). His findings have remained relevant until today since the same styles of leadership are still I n evidence. They include:
- Delegative leadership
- Participative leadership
It is also known as autocratic leadership, and the leaders give the employees a list of tasks and targets that are expected (Mumford, 2010). Leaders also give explicit directions on how these objectives are to be met and how the employees conduct themselves in the process. There are several features defining an autocratic leadership style:
leader gives all the directions
- Feedback from the staff is minimal to non-existent
- There is a feeling that employees are not very much trusted
- Leadership is mainly involved in getting the job done
- There is no sense of empowerment and morale usually suffers in the long run
Autocratic leadership is applied in various scenarios, but the overriding truth is that it is not sufficient as individual leadership styles in most companies today. It can bring more harm than good in the long run, but it is necessary for such situations where a task is urgent and hence there is no time for back and forth consultations (Sadler, 2003). In cases where the labor is not well skilled, this method can be used since it gives explicit directions to be followed. In dangerous working conditions, clear instructions could be used to ensure that people stay out of harm’s way. Autocratic leadership is essential in streamlining processes and has been evident from famous leaders like John Rockefeller and Wal-Marts Sam Walton (“Autocratic Leadership: Definition, Examples & Quotes,” 2016). Restaurants are a perfect example of businesses that thrive on authoritarian leadership since the margins for error are very slim. Customers in a restaurant expect consistency and high quality at all times with no inconveniences.
Autocratic leadership has several advantages:
- Where deadlines have to
be met it can be the best method but it must involve discipline and structure
- It helps to train employees who may not have the relevant skills.
- Leaders can end up becoming bossy and dictatorial at the expense of employee morale
- Resentment from the employees may grow
- There is no creative problem solving since no teamwork is involved
Participative leadership is also referred to as democratic leadership, and it includes both leaders and employees in decision making (Business Administration, 2008). One or more employees are engaged in the process of making decisions, but the final decision rests with the management. Some people view this style as a sign of weakness from the leaders, but it is a display of confidence in the staff. This style of leadership is most evident in cases where leaders have part of the information while the employees have the other part (Sadler, 2003). The primary purpose of employing people who are educated and highly skilled is so they can help in making the right decisions. One situation where this type of leadership applies best is in the high-tech firms. The technology industry and participative leadership go hand in hand since most involve teams of engineers and software developers that work in close collaboration with participative leaders to achieve the set targets. High-tech firms initially start off with laissez-faire leadership style before evolving into democratic leadership and finally they become autocratic (“Leadership Styles,” 2016).
Participative leaders will create an environment that is suitable for sharing of ideas.
- They facilitate the conversation and enable employees to participate in the process.
- They share information and knowledge in an open manner
- Leaders encourage employees to share their ideas freely
- They synthesize the information that is collected
- Leaders make the best decisions possible from the information
- Once decisions are made, leaders communicate them back to the group
- Employees feel valued and part of the organization (“Leadership Styles,” 2016).
- People perform to the maximum even in the absence of the leader
- Since people feel valued, they will work harder to achieve the targets of the company
- There is social pressure to conform to the group expectations
- Decision making might be a time-consuming process
- The costs involved are high since there is extensive consultation.
- Incompetence might creep into the decision making activities
- There are many moments of indecision since numerous parts are involved
This style of leadership can also be referred to as Laissez-faire, and it implies non-interference with the affairs of other people (“Leadership Styles,” 2016). In this style of leadership, the employees are given the mandate of making decisions. Employees have to be highly qualified to since the decisions they make the responsibilities of their leaders. The employees must have strong analysis skills so as to come up with well-thought decisions that are in line with the values of the organization as a whole.
Managers might be too busy with other tasks, and hence delegation is necessary to ensure that business does not stagnate when the leadership is pre-occupied (Johnson, Scholes, & Whittington, 2008). Managers use this style of leadership only when they have full confidence in the junior members they delegate the tasks. Laissez-faire style of leadership works best where the market is moving fast such as in advertising and research and development in a firm (“Leadership Styles,” 2016). Retail buyers and merchandising managers employ this style of leadership. Purchasing decisions within fast moving markets are based on fluctuating factors such as bottlenecks in the supply chain, severe weather patterns, consumer trends and so on. Product managers are given the independence to react to market changes and make quick decisions.
- It ensures that the
staff involved in decision making are highly qualified
- Team members might be more knowledgeable than management in certain cases, and this method is perfect for such a situation. It allows them to demonstrate their skill and expertise.
- Members of the team might feel free and happy to work since they are involved in the core of decision making. They become motivated, and they achieve higher levels of job satisfaction.
- Individual members of the group may not be highly qualified to make the decisions, and this is a glaring drawback. Some people are poor project managers who cannot beat their deadlines and cannot solve problems independently. This situation could lead to several projects getting derailed.
- Delegation causes roles within the organization to become poorly defined. Since there is little to no guidance from the leadership, the roles of the employees may not be clearly defined.
- Lack of cohesion could creep into the group since the leaders are seen as distant and uninvolved. The employees might start expressing lesser care and concern for the job at hand.
- Some leaders may use this method to escape the responsibility for failure when it occurs. When targets are not achieved, the manager can lay the blame on the workers.
Culture is a vital part of trying to comprehend a global company (Hughes, 2011). These huge companies will often employ expatriate managers who may not even belong in the host country (Connerley & Pedersen, 2005). It is therefore very crucial for leaders in such a case to be well versed in the culture and traditions of the country they work in. When leaders understand the diverse cultures of the communities that they operate in, they can learn how employees view the company and how different values, attitudes, and beliefs affect their workplace.
Component of Culture
Various factors come into consideration when evaluating the culture of a new country:
- Power distribution- it
examines whether the people will follow the egalitarian ideology or the
hierarchical approach (Hubbard,
- Social relationships- do the people believe in individualism or collectivism.
- Environmental relationships- do people strive to live in harmony with their surroundings or do they exploit the environment to their benefit.
- Work patterns- are the people used to multitasking or doing one task at a time
- Uncertainty and social control- do members of a community prefer to be rule-bound and avoid risk or are they relationship-based where they deal with risks as they arise (Hughes, 2011).
Cross-Cultural Management Theories
The difference between success and failure in such a company will come down to how best the leaders learn and embrace the culture of the communities in which they operate. (“Effective Leadership within a Multinational Environment – Leadership Advance Online, School of Business & Leadership, Regent University, Virginia Beach, Virginia,” 2016). Several theories have been put forward:
Hall and Hall– they implied that efficiency in social communication was the essential factor in ensuring success in management when dealing with different cultures (Connerley & Pedersen, 2005). The management is responsible for ensuring that there are open lines of communication within the organization. Two categories of culture were identified, and their impact on business operations and organization performance was examined. The two types include:
High context culture- they are regarded as having a relatively high homogenous view when it comes to nationality, religious values, attitudes, and beliefs. This culture is mostly evident under Japanese management or in Arab countries. Gesturing and body language are given significant consideration.
Low context culture- communication is more identifiable when it is presented in a written form. It is mostly the case in the U.K and U.S.
Geert Hofstede– this theory implies that culture could be classified via different dimensions at the national level (Connerley & Pedersen, 2005). These aspects include masculinity-feminity, individual collectivism, power distance, uncertainty avoidance and long-term versus short-term orientation.
versus small power distance- large power distance describes the extent to which
the staff is willing to admit that there is inequality in the authority
distribution within the company. Small power distance is when the workers agree
that power is distributed in a fair manner (Connerley
& Pedersen, 2005).
- Strong versus weak uncertainty avoidance- high uncertainty avoidance looks at the extent to which worker fell uncomfortable with uncertainty leading them to support beliefs that ensure certainty while protecting conformity. Weak uncertainty avoidance looks at the level of employee tolerance towards change.
- Individualism versus collectivism- individualism is when there I more preference for a social model that is loosely knit while collectivism advocates for a social, model that is more tightly knit.
- Masculinity versus feminity- in context, masculinity looks at fulfillment, forcefulness, heroism, and material success while feminity examines a preference for relationships, modesty, taking care of the weak and quality of life.
Fons Trompenaars– he put forward the theory naming seven cultural dimensions that are relevant to the relationship with the personnel in an organization. They include:
- Universalism vs.
- Individualism vs.
- Specific vs. diffuse
- Linear vs. circular
- Neutral vs. emotional
- Achievement vs. ascription
- Internal vs. external control
- Individualism vs. collectivism
Fons attributed the above dimensions as being vital in managing cultural diversity.
Leadership and ethics are inseparable since all managers must operate within a code of conduct that can be emulated by all workers (Hubbard, 2004). It goes without saying that ethical behavior displayed by the company and employees has a tremendous impact on customers as well as other business partners. Ethical standards are maintained by setting expectations while choosing to do the right thing at all times and providing guidance to the workers.
Ethical standards make sure that the company and all the employees operate in a manner that is trustworthy and honest (Jeurissen & Rijst, 2007). Setting these standards will enable employees to focus on activities that make the whole company better and also give them the power to voice out situations that may imply dishonesty and other unethical behavior (Hughes, 2011). Ethical programs in a company will provide the standards and expected code of conduct that is followed by all employees. Leaders have to establish the core values that the company must abide by such as trust, respect, honesty and so on. When leadership places sufficient emphasis and importance on ethical behavior, the employees will follow suit (“What Are Ethical Standards in the Workplace?”, 2016). Managers can even come up with a reward program for employees who display exceptionally high standards of ethics.
Leadership is a vital component in
any organization and more so in big multinational companies. It is clear that
the three leadership styles form the basis of management and they should be
combined in the most suitable way to ensure that all factors are taken into
consideration. Styles such as the authoritarian should be mixed with other
styles that allow for more employee participation if it can be helpful in the
situation. When managers are in charge of a workforce from diverse cultural
backgrounds, they must be considerate enough to ensure that employees work in a
way that they feel comfortable. Leadership must be the guiding light for the
other employees, and hence they should provide a good example to the workers on
ethics and values to be followed.
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