Business Leadership


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This revision presentation provides business students with an overview of the role of leadership in business strategy

Published in: Business, Education
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Business Leadership

  1. 1. Leadership
  2. 2. Different meanings of leadership• Getting others to follow• The use of authority in decision- making• A personal characteristic• An ability to achieve effective performance in others
  3. 3. A general interpretation of leadership A relationship through which one person influences the behaviour or actions of other peopleSource: Mullins (The Nature of Leadership)
  4. 4. Leadership perspectives• Traditional view – Command & Control – Decision-making• Modern view – Inspiration – Creating a vision – Building effective teams
  5. 5. Importance of leadership in modern business • Changing organisational structures – Flatter + greater delegation – Teamwork + focus on quality assurance – Coaching, support & empowerment • Rapid environmental change – Change is becoming a constant feature of business life – Soft skills of leadership & management increasingly important
  6. 6. The role of strategic leadership• Strategic leaders are the people who influence or control the corporate strategy of a business• Often personally identified with the strategy• Occurs both in small firms (e.g. the founder) and large corporates
  7. 7. How strategic leadership is demonstratedWhere leaders take Where leaders setdirect control the vision and core beliefs Leadership as Leadership command as vision Leadership as Leadership as decision- symbolicWhere the leader is making Where the leaderthe embodiment of weighs up thethe strategy, but not options andinvolved day-to-day decides
  8. 8. E.g. leadership as command & vision I believe we have lacked accountability and leadership to align and direct the company through these disruptive times. We had a series of misses. We haven’t been delivering innovation fast enough. We’re not collaborating internally. Nokia, our platform is burning. Stephen Elop CEO, Nokia
  9. 9. E.g. leadership as symbolic
  10. 10. Leadership or Management? Leaders Managers Inspire people Enact the planBuild relationships Use their authority Take risks Manage risks Have followers Have subordinates In reality, both are closely linked
  11. 11. What is a leadership style?The way that the functions of leadership are carried out The way that a leader behaves
  12. 12. Everyone has their own style
  13. 13. Broad classifications of leadership style Authoritarian Paternalistic Democratic Laissez-faire
  14. 14. Authoritarian• Focus of power is with the manager• Communication is top-down & one-way• Formal systems of command & control• Use of rewards & penalties• Very little delegation• McGregor Theory X approach
  15. 15. Paternalistic• Leader decides what is best for employees• Links with Mayo – addressing employee needs• Akin to a parent/child relationship• Still little delegation• A softer form of authoritarian leadership
  16. 16. Democratic• Focus of power is more with the group as a whole• Leadership functions are shared within the group• Employees have greater involvement in decision-making• Emphasis on delegation and consultation• A trade-off between speed of decision- making and better motivation and morale?
  17. 17. Laissez-faire• Leader has little input into day-to-day decision-making• Conscious decision to delegate power• Managers / 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
  18. 18. Why move away from autocratic leadership?• Changes in society’s values• Better educated workforce• Focus on need for soft HR skills• Changing workplace organisation• Greater workplace legislation• Pressure for greater employee involvement
  19. 19. McGregor Theory X & Y Grouped Managers into Two Types Theory X Theory Y Managers Managers Average worker is lazy Most people enjoy work and dislikes work Workers will take Workers need to be responsibility and controlled & directed organised themselvesCentralised organisation Decision-making can beand exercise of authority delegated
  20. 20. Tannenbaum and Schmidt (1)• A “continuum” of leadership behaviour• Continuum represents a range of action related to the: – Degree of authority used by the manager – Area of freedom available to non-managers• Links with Theory X (boss-centred leadership) & Theory Y (subordinated- centred leadership)
  21. 21. Tannenbaum and Schmidt (2)Four Main Styles of LeadershipTells Manager identifies problems, makes decision and announces to subordinates; expects implementationSells Manager still makes decision, but attempts to overcome resistance through discussion & persuasionConsults Manager identifies problem and presents it to the group. Listens to advice and suggestions before making a decisionJoins Manager defines the problem and passes on the solving & decision-making to the group (which manager is part of)
  22. 22. Factors affecting leadership style• Personal value • Type of organisation systems (size, structure)• Manager’s experience • Effectiveness of teams• Confidence in and groups subordinates • Skills and experience• Feelings of security of subordinates• Nature of the business • Pressure (time, costs) problems
  23. 23. Which leadership style is best?• Many alternative forms & styles• Right leader for the right situation – Autocratic makes more sense when business is in trouble (e.g. rapid turnaround) – Autocratic would be inappropriate where performance highly dependent on effective team-working & decentralised operation – Stage of business: start-up v established & complex
  24. 24. Five essential qualities of a leader 1 Courage 2 Confidence 3 Concentration 4 Passion 5 Values
  25. 25. The six tasks of leaders• Be clear about what change is required• Turn ideas into action points and motivate others to act on them• Win commitment based on honest, realistic, two-way discussion• Create a climate of learning, so people know it is safe to make mistakes• Keep going – persistence is vital• Learn from experiences and mistakes
  26. 26. Leadership tasks of the MD• Create the vision, based on an understanding of SWOT• Form the team and a structure that will help achieve business goals• Decide key business and personnel policies• Manage rewards and discipline
  27. 27. Leadership and business change Successful management of change requires positiveaction from top management and a leadership style that gains a commitment to change
  28. 28. “Change leaders” Effective change management involves…• Effective, open communication of the reasons for change• Championing innovation and creativity as a response to change• Setting a good personal example
  29. 29. Leadership quotes (1) Management is doing things right; leadership is doing the right thingsPeter Drucker
  30. 30. Leadership quotes (2)"How do you know you have won? When the energy is coming the other way andwhen your people are visiblygrowing individually and as a group." Sir John Harvey-Jones
  31. 31. Leadership quotes (3)""Management is efficiency in climbing the ladder of success; leadership determines whether theladder is leaning against the right wall."Stephen R Covey
  32. 32. Keep up-to-date with businessstories, resources, quizzes and worksheets for your business course. Click the logo!