Lm Assg Final(4 Apr)

BUSM3195 - LEADERSHIP AND MANAGEMENT

INTRODUCTION

Procter and Gamble Co. (P&G) is an American multinational corporation (MNC) where

its business focuses on fast-moving consumer goods. Durk Jager, the former chief

executive officer (CEO) of P&G, reorganised the company to meet the growing demand

of globalisation. However, his drastic plans proved futile as thousands of followers were

confused and demoralised by his move. As a result, P&G’s stock went into tailspin after

reducing two earning projections (Tichy & Bennis 2007). Therefore, in 2000, Jager was

eventually replaced by Alan George Lafley, who later transformed the company to its

current state. In 2007, P&G was ranked as the 8th largest corporation in the world by

market capitalisation, the 14th largest company by profit in the States and also the top ten

in Fortune’s most admired companies list.

Apple Inc. (Apple), a relatively younger organisation, is also an American MNC.

However, it deals with consumer electronics and software product instead. Apple was in

a dire state before Steven Paul Jobs, aka Steve Jobs, took the post of CEO. Under his

charge, several popular products were created and some of them include the Macintosh

computers, iPod, iPhone and Macbook etc. In 2008, Apple has achieved worldwide

annual sales of US$32.48 billion in its fiscal year ending September 2008 and Fortune

magazine had also named Apple as the most admired company in the States.

The successful revival of these two companies can be attributed to the effective

leadership of their CEOs, Alan George Lafley and Steve Jobs. They have received

worldwide praises about their leaderships for amplifying their market price and leading

their respective companies from a deteriorating empire to where it is now. Hence, the
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characteristics of each leader, their transformational leadership, and how they developed

teamwork within their organisation and motivate their employees are significant to

leadership effectiveness.

APPROACH

Firstly, characteristics of leaders can be classified into three categories namely,

personality traits, leadership motives and cognitive factors (Dubrin, Dalglish & Miller

2006). As recent studies had also recognised that these characteristics will facilitate and

determine the effectiveness of leaderships, and it is the integration of these personal

characteristics that cultivate a consistent pattern of leadership behaviours (Zaccaro, Kemp

& Bader 2004). Therefore, the characteristics that attribute to their successful realms are

relevant to their leadership effectiveness.

Secondly, transformational leaders employ a visionary and creative style, not only to

inspire the employees to be creative and innovative, but also to broaden their interest in

their work (Nielsen et al. 2008). They are also able to devote significant energy to lead

and respect the gifts and abilities of their workers (Bryant 2003). Furthermore, they focus

on what they accomplish rather than their personal characteristics and relationships with

followers, and it is especially important as leaders may have to lead people from across

the world (Dubrin, Dalglish & Miller 2006). Moreover, many organisations are facing

turbulent and intense competition. Thus, their transformational leadership, to manage the

chaos and restructure the organisation, are vital to the survival of the organisations in the

long run.

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Lastly, motivation is a hidden force to induce someone to do something that is desired

through various approaches (Arnold 1988). Hence, it is essential to motivate employees

through the right approach in order to achieve organisational goals (McShane &

Travaglione 2007). Developing teamwork is another important leadership role that is said

to differentiate successful from unsuccessful leaders as it will influence the followers to

work effectively in a cohesive manner (Locke et al. 1999). Hence, their methods of

motivation and fostering teamwork would be relevant in determining their leadership

effectiveness too.

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ALAN GEORGE LAFLEY

Traits

Lafley has shown immense passion for his work and the people in the organisation. For

instance, even when it is Mother’s Day, he would meet the company’s head of human

resource, Richard Antoine, to go through reports on the performance of the company’s

senior executives every Sunday evening (Sosik et al. 2004). The fact that he could even

sacrifice the time with his mother on Mother’s Day has shown his determination and

passion to preserve the company’s culture of valuing talents.

Additionally, Lafley has demonstrated his farsightedness by acquiring SpinBrush and

Clairol in 2001, shortly after taking over the post of CEO (Berner 2002). From the

acquisitions of these two companies, he actually strengthened the company core strengths

in hair and oral care, and also increased its market share and maintaining a balance

between sales and profit growth where analysts had also expected P&G’s operating

earnings to increase by 9% (Berner 2002).

Furthermore, Lafley is also soft-spoken, friendly and warm in nature. He displayed a high

level of emotional intelligence, especially his self regulation, by not screaming and

yelling at his subordinates because he believes that the messenger is just as critical as the

message (Berner 2003). Besides that, he also has the ability to build enduring

relationships as he relied a great deal on relationships he had built over the years to

transform P&G’s culture (George 2006). For example, when a student asked him a dull-

witted question, he showed patience and willingness to listen in order to understand the

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question by returning to the student repeatedly, resulting in better relationships between

him and his followers (Krauss 2008).

Lastly, Lafley also has insight into people and situations when he by-passed dozens of

potential general manager and appoint Henretta to head the North America baby-care unit

(Tichy & Bennis 2007). Although there was almost a rebellion against his decision, he

upheld his decision and justified why Henretta was better than the other candidates

(Tichy & Bennis 2007). Despite all these, Henretta’s success has proven that Lafley has

chosen the right person for the post (Tichy & Bennis 2007).

Transformational Leadership

When Lafley took over as CEO, he realised the critical problem he was facing was not

about turning P&G from the losses of US$85 billion in market capitalisation to

profitability. Instead, the crisis confronting P&G was the loss of confidence in the

leadership as the organisation was in a state of chaos. Headquarters and business units

globally were blaming each other for the problems created and employees were calling

for heads to roll (Tichy & Bennis 2007).

Thereafter, Lafley flaunted his transformational leadership by helping his followers

understand that the organisation needed to undergo major changes in order to survive and

eventually managed to transform the culture to a nimbler and more open one (Woolley

2005). He also created awareness and got them to face up to the reality that it is critical

for the organisation to change so that it will be more profitable, resulting in lesser

retrenchments (Tichy & Bennis 2007).

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For instance, only ten days in office, he immediately flew to Europe to listen to the

complaints and addressed their issues in order to help them understand and be aware of

the changes that were ahead of them (Dyer, Dalzell & Olegario 2004). During such

meetings, he shared his core beliefs on the ten things he believed about the fundamentals

of business (Dyer, Dalzell & Olegario 2004). This helped his followers understand the

need for change. As a result, it rallied everyone to work more cohesively in order to

achieve organisational goals.

The corporate culture he advocated was revolved around innovation and creativity

(Hamstra 2008). He made it explicit that innovation in every facet of operations, from

inventing to distributing, is crucial to keep the company in existence (Berner 2008).

Subsequently, in 2001, Lafley allowed innovations to flow freely across the entire

organisation and encouraged outsourcing for innovators to make up at least fifty percent

of its innovations (Skarzynski & Gibson 2008). As such, the organisation had been able

to introduce numerous new products to the market that exemplified the innovation

fortitude of P&G (Skarzynski & Gibson 2008).

Therefore, it is evident that when Lafley mandated about the innovation imperative, he is

intensely transforming the organisation (Skarzynski & Gibson 2008). Furthermore,

Lafley was visionary and was not afraid to make changes. Hence, Lafley transformed a

legendary but ossifying company by organising around innovation (Saporito 2008).

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Motivation and Developing Teamwork

Lafley motivates his employees by empowering the management team to make business

strategic decisions by just providing them the directions. This is similar to the motivating

factors advocated by Herzberg (cited in Sanford & Taylor 2006). On one occasion, he

even shook the hands of a student working in the company and told him that the work he

is doing is vital to the future of the organisation (George 2006). Another example of his

recognition of efforts put in by the followers is that he heaps praises on them, including

his division president, brand managers and other employees (Krauss 2008).

In addition to that, Lafley had used informal techniques to foster the teamwork of his

followers. For example, he had worked very hard to change the company’s new strategy

to be customer driven innovation (Saporito 2008). Through reiterating the new strategy,

the team would be able to develop a norm that innovation will become a routine for

everyone (Berner 2008). He also encouraged his followers to compete with rivals so that

they will collaborate as a team to win the rivalry as a whole (Lafley & Charan 2008). On

another occasion, before the company started outsourcing, he adopted the consensus

leadership style by having various teams to give inputs and vigorously debate on the issue

(Lafley & Charan 2008). In the course of contributing inputs to significant decisions,

members would feel that they are more valuable to the team and resulting in improved

team effectiveness (Dubrin, Dalglish & Miller 2006).

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STEVE JOBS

Traits

Jobs is a leader who is capable of influencing his followers to have strong desire for work

as he possessed a high degree of passion for his work. Even though he always yelled at

them, they appreciated his strong passion where he always spend long hours at work

(Kahney 2008). Thus, he was able to capture the spirit of his followers and work

cohesively towards a common goal (Young & Simon 2005).

Furthermore, Jobs is a leader with low emotional intelligence as he does not care about

his followers' feelings as he strives for perfection incessantly and will hurl verbal attacks

at those who failed to meet his demands (Lee 1994). Additionally, his reputation in the

organisation further enhanced his deficiency in emotional intelligence as he screams at

his followers frequently and randomly fired those unlucky ones (Young & Simon 2005).

Additionally, Jobs had displayed his farsightedness when he reduced the product lines

and cut the wholesale cost with a year in office (Morris & Levinstein 2008). Even though

there were vast numbers of mobile phone models catered to suit the needs of the dynamic

consumer market, he stood on his solid grounds to launch the iPhone, which generated

tons of profits for the company (Burrows 2009). As a result, he not only prevented Apple

from further losses, he also turned Apple into a profitable business (Kahney 2008). In

another instance, he confidently opposed to the major accordance to launch the iMac

without a floppy drive and it proved that the floppy drive technology has diminished

(Kahney 2008).

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Lastly, Jobs has the insights into his people and situation as he makes careful assessment

of the strength and weakness of each staff (Dubrin, Dalglish & Miller 2006). For

instance, he had a core team, where all his outstanding staffs reside in, to assist him with

key assignments such as the Mac project (Kahney 2008). One very good example is

Jonathan Ive, who had helped him in the creation of iMac and iPod (Kahney 2008). Thus,

the formation of the core team allows him to tap on the best knowledge to handle those

projects with utmost importance.

Transformational Leadership

When Jobs took over the position of CEO, due to the incompetency of the previous CEO,

the main crisis facing Apple was that there were too many non-profitable products

causing the organisation to be on the verge of bankruptcy (Burrows 2009). Thus, Jobs

held individual meetings with all product groups. During these meetings, they had to

convince him that the product was profitable or else they will be terminated and he

managed to make them understand the criticality of a change in order for the organisation

to survive (Kahney 2008).

As a result, he took a broad and long term perspective to eliminate those non-profitable

products. His intention was to focus on the core products to increase the profitability of

the organisation and expertise of his followers so that he can obtain the results he aimed

to achieve (Baldoni 2006). As such, he managed to strengthen the brand name and

reincarnate it to thrive in a disruptive age (Morris & Levinstein 2008). Another of his

long term vision for Apple is to convert Apple into a digital hub where digital

entertainments devices could be connected to this technology centrepiece (Kahney 2008).

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Furthermore, he managed to convince all the employees that the organisation can develop

new businesses like cell phones despite the intense competition in the market (Burrows

2009). Subsequently, he also managed to convince them that they were in a distinctive

position where they will change the face of computing that no one had created before

(Kahney 2008). As a result, they will be more willing to accept responsibility for what

they have been doing (Baldoni 2006). Hence, ever since the introduction of iPod, his

followers are very much self-fulfilled as Apple has dominated the consumer electronics

market with the complements of iPhone and Mac products (Lyons 2008).

Therefore, Jobs has evidently transformed his followers to widen their interest in their job

by helping them to realise the self-fulfilment they will achieve. Moreover, his vision was

clearly communicated to his followers who helped to transform Apple into a digital hub.

Hence, he is definitely a transformational leader who managed to revive Apple to thrive

in the competitive market.

Motivation and Developing Teamwork

The way Jobs motivate his followers is comparable to Herzberg’s motivators as he

believes in giving capable followers the reins and chances to make good decisions

(Morris & Levinstein 2008). For instance, he recognised the ability of Cook, Apple's

chief operating officer, and entrust the company’s daily operations in his hands where he

will only make the strategic decisions (Lashinsky & Siklos 2009). He also respects Cook

as the company has already coalesced around him because he did almost nothing that

would make people disrespect him (Lashinsky & Siklos 2009). On another occasion, Jobs

praised Ratzlaff, leader of Human Interface Group, for creating an exciting design for

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iMac which gave him a sense of achievement because Jobs was a person with very high

expectations (Kahney 2008).

Additionally, Jobs foster the teamwork of his followers by one of the informal

techniques, demanding performance standards and providing directions. For instance,

during one design meeting, he took a telephone book and threw it on the table demanding

them to build a computer of that size, where the size of the smallest computer back then

was twice as big as a telephone book (Kahney 2008). As a result, it actually serves as a

wakeup call to his followers stipulating them to work cohesively in order to satisfy his

demand (Kahney 2008).

On another occasion, he just gave directions to his team that he was counting on them to

deliver a software demo disk (Kahney 2008). They went back to their cubicles

immediately and start working as a team in order to deliver to their demanding boss as

they did not even had the chance to rebut (Kahney 2008). Therefore, he is said to give the

team lots of challenging goals which eventually brought the team together cohesively.

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SIMILARITIES

One of the similarities that both leaders have is their passion in their work. Lafley was

willing to forgo his rest days to guide and manage his staff, while Jobs was known to

work overtime to ensure that tasks were accomplished. Their passion, which is a task

related personality trait, puts everyone on overdrive and things naturally move and fall

into place (Dubrin, Dalglish & Miller 2006). As highlighted by Vallerand et al. (2007, p.

506), ‘being passionate for an activity leads individuals to dedicate themselves fully to

their activity, thereby allowing them to persist, even in the face of obstacles, and to

eventually reach excellence’. Hence, it suggests that if a leader has passion for his job, he

should be able to bring about a successful organisation.

Another key similarity they possess is their cognitive abilities. Both of them are

considered to have farsightedness and an intuition to identify people with good potential

to carry out important tasks. Their farsightedness is critical as it helps to shape the vision

and corporate strategy that brought their companies out from crisis. Additionally, their

insight of people and situation helped them to appoint the right people to hold key

positions. In Lafley's case, he recognised that Henretta had the right leadership abilities to

turn around the baby care unit, even though she had no experience in that area. Jobs

displayed similar ability by selecting Jonathan Ive, whose creativity helped to create the

famous iMac and iPod. Thus, it could be concluded that these two cognitive factors are

thought to be essential of an effective leader (Dubrin, Dalglish & Miller 2006).

Apart from having some similar characteristics, they are considered as transformational

leaders. They were able to convince and influence their people to accept and commit to

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change. For example, when their followers were not ready to step out of their comfort

zone, they had managed to help their followers understand the importance for change in

order for the companies to survive in the long run. Therefore, transformational leadership

is vital to organisations as it boosts the followers' motivation and their intrinsic needs,

resulting in higher performance from them (Dubrin, Dalglish & Miller 2006).

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DIFFERENCES

However, the difference in emotional intelligence distinguishes the two leaders. Lafley is

a leader who has self regulation and social skill which allows him to be able to connect

with his followers and understand them, resulting in better relationship between him and

his followers (Dubrin, Dalglish & Miller 2006). Although he seems to be quite people-

oriented, he is very decisive when it comes to work (Berner 2003). On the contrary, Jobs

is a leader who does not empathise on anyone and socialise with his counterparts.

Although Jobs does not have a high level of emotional intelligence, he is still able to lead

the organisation to achieve the goals successfully. Thus, it appears to imply that the level

of emotional intelligence does not affect leadership effectiveness to a large extent.

Although the two leaders similarly believed that if they desire positive attitudes and job

satisfactions from their followers, they will have to motivate them using Herzberg's

motivators, but they used different approaches to achieve the same results (Herzberg

2003). Lafley is a leader who recognises the efforts of almost everyone in the company as

he constantly heaps praises on his followers. On the other hand, as Jobs sets high

expectations from his followers, he seldom praises them. However, this provides them

with the sense of achievement, which motivates them to produce better results in the

future. Therefore, it may be simplistic to suggest that the two leaders used different ways

to motivate their followers as the fundamental approach which leads to positive attitudes

and job satisfaction is still the same (Herzberg 2003).

Lastly, another key difference between the two leaders is the way they develop teamwork

amongst their followers. Lafley fostered the teamwork by reiterating the strategy in order

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for them to develop a norm. Thereafter, his followers are more likely to work cohesively

in order to achieve organisational goals due to the collaboration. On the other hand, Jobs

fostered teamwork by constantly challenging his followers. As a result, they are likely to

focus on a common purpose and work cohesively to meet the standards he set. Therefore,

although the two leaders use two different ways to foster teamwork, their respective

teams are still able to work cohesively to achieve higher quality performance (Dubrin,

Dalglish & Miller 2006).

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LEARNING SUMMARY & CONCLUSION

A leader’s characteristics can have an influential impact on the organisation and the

different characteristics displayed by Lafley and Jobs proved that characteristics are not

the same with every leader, but is unique to the individual. However, Kirkpatrick and

Locke (1991, cited in Pierce & Newstrom 2006) advocated that although possessing the

correct set of characteristics does not guarantee successful leadership, but these are

considered vital preconditions that an effective leader must possess. For example,

effective leaders need to be mentally sharp in order to inspire followers, solve problems

creatively and eventually bring about positive organisational changes (Dubrin, Dalglish

& Miller 2006). Therefore, in contemporary organisations, the traits approach is

definitely still very much appreciated because when the situation becomes more complex,

it will play a more significant role in anticipating successful leaders (Zaccaro, Kemp &

Bader 2004).

Both Lafley and Jobs proved that transformational leadership is particularly valuable for

organisations in crisis as it will increase the followers’ level of trust, loyalty and respect

towards the leader while being motivated to do more than what were expected of them

(Bass 1985, cited in Tsai, Chen & Cheng 2009). In other words, it is able to directly

influence employees to stretch their abilities for task accomplishments (Tsai, Chen &

Cheng 2009). Thus, transformational leadership is ultimately recognised in terms of its

performance outcomes of the organization (Walumbwa, Avolio & Zhu 2008).

Using Herzberg’s motivator to motivate followers is deemed as a positive reinforcement

and they are effective because the desire for recognition is a natural human need, and

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employees want to know that their work is beneficial to somebody (Dubrin, Dalglish &

Miller 2006). Thus, it can be detrimental to an organization’s growth if a manager fails to

recognise employees’ works (McClelland & Burnham 1990). Therefore, managers, who

wish to be as successful as Lafley and Jobs, must recognise the fundamental needs of

employees to be appreciated, needed and wanted so that they feel respected and

recognised (Arnold 1988). As a result, employees will be more willing to work for the

organization because they regard the organization as part of their life and thus producing

better results (Arnold 1988).

There are intrinsic rewards related to superior teamwork as it will be able to tap on the

diverse knowledge of individuals in the team (Adler 1997). As a result, it can simplify

challenging tasks which will lead to reduction in turnover times and costs (Dempsey,

Larson & Shockley 2009). Additionally, teamwork can also increase followers’ job

satisfaction when they can collectively seek and sort through useful information and

enjoy effortful cognitive activities for solving problems (Park, Baker & Lee 2008). Even

senior managers and professionals are organised into teams to reduce barriers and

decrease bureaucratic red tape (Gautschi 1990). Hence, organisations, that desire to be as

flourishing as P&G and Apple, must utilise the art of teamwork to boost productivity and

increase quality (Gautschi 1990).

In a nutshell, the characteristics of a leader do not guarantee his success, but it is a

prerequisite of an emergent leader. Thus, if a leader, with the correct set of

characteristics, is transformational and has the ability to motivate his followers

appropriately and foster their teamwork, he will definitely be an effective leader.

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