2.1.1 UNDERSTANDING MANAGEMENT, LEADERSHIP AND

DECISION MAKINGAQA Business

2 MANAGERS,LEADERSHIP AND DECISION MAKING

Are managers and leaders the same?

Think of examples from the worlds of:

• Sport• Music• Politics• School/college• History• Part time jobs/work experience

2 .1 .1 UNDERSTANDING MANAGEMENT , LEADERSH IP AND DEC IS ION MAK ING

In this topic you will learn about

What managers do

Types of management and leadership styles and influences on these

The effectiveness of different styles of management and leadership

How significant is the role of managers in determining business performance?

MANAGERS AND LEADERS

Leadership is the ability to influence and direct people in order to meet the goals of a group

Management is the process through which company resources are used and decisions made in order to meet the objectives of the firm

Leaders are those people that can inspire and motivate people to meet objectives

Managers will set objectives and decide how to go about achieving them

Often leaders and managers are one and the same person

WHAT MANAGERS DO

The role of managers includes:

Setting objectives targets to be achieved within a given time period

for individuals and teams

Analysing factors contributing towards the achievement of objectives

business performance

WHAT MANAGERS DO

The role of managers includes:

Leading communicating objectives and directing subordinates to

achieving these goals

motivating subordinates

Making decisions allocation of resources

day to day running of the business

Reviewing monitoring performance against objectives

taking action as necessary

Further reading on the role of a manager.

IN PAIRS

Review the 3 job descriptions below for a retail, office and restaurant manager

Identify the similarities and differences

Write a generic job description for all managers

Remember in the

examinations you will need to be able to apply your

knowledge to a range of

scenarios.

FA C T O R S T H A T I N F L U E N C E L E A D E R S H I P S T Y L E S

Internal Factors

There are a number of internal factors that influence the style of leadership:

The expertise and experience of the workforce

The skills required for the work to be done

The personal traits of the leader

The power given to the leader

The time frame associated with the task to be undertaken

What traits would you

look for in a leader?

FA C T O R S T H A T I N F L U E N C E L E A D E R S H I P S T Y L E S

External Factors

There are a number of external factors that influence the style of leadership:

The political and legal environment

The economic environment

The social environment

The technological environment

Changing nature of the industry

L E A D E R S H I P S T Y L E S

Autocractic (Authoritarian) – the leader makes a decision without consultation e.g. in the army when quick decisions are required in battle

Democratic – the leader consults his team but makes the final decision e.g. a skilled workforce where each team member can make strong contributions

Laissez-Faire (to leave alone) – the leader allows his team to make decisions e.g. experienced and competent staff given freedom to make decisions themselves

Paternalistic – the leader acts in a fatherly way towards the workforce – making decisions based on the needs of the workforce as well as the business e.g. often family or smaller organisations with a more caring style of leadership,

Bureaucratic – leaders work to rules and regulations, ‘by the book’, e.g. in bureaucratic organisations where the culture is very much led by the rules

Think of a situation

where you have been the leader. Which

leadership style did you

adopt?

MANAGEMENT AND LEADERSHIP STYLES

Theories of management and leadership styles include:

The Tannenbaum Schmidt continuum Leadership model based on a spectrum between two

extremes of manager centred and subordinate centred approaches

Recognises that in reality leaders are unlikely to be at either extreme but somewhere along the spectrum

The Blake Mouton grid Leadership model based on two behavioural dimensions

of concern for people or concern for production which identifies 5 leadership styles

Read Richard Branson's top 10 quotes on leadership.

TANNENBAUM SCHMIDT CONTINUUM

The Continuum Theory looks at 7 levels of delegation from:

1 no delegation to

7 highly delegated

TANNENBAUM SCHMIDT CONTINUUM

1. Manager takes and announces decisions2. Manager sells decision3. Manager presents decision with ideas and invites questions4. Manager suggests provisional decision and invites discussion5. Manager presents the situation, gets feedback and then decides6. Manager explains, defines parameters and asks team to decide7. Manager allows team to develop options and decide on action based

within managers limits

Why might a leader

change their style based upon the situation?

TANNENBAUM SCHMIDT CONTINUUM

From this continuum there are four categories of leadership identified:

Sells

Tells

Consults

Participates

Discuss each of the points 1 – 7 along the continuum.Allocate numbers to each of the 4 categories above.

With reference to the continuum. Explain each of the 4 categories in your own words.

TANNENBAUM SCHMIDT CONTINUUM

The approach that the manager will adopt will vary and depend upon:

The forces in the manager Personality and characteristics

Experience

Attitude towards and trust in subordinates

The forces in the subordinates Personality and characteristics

Experience

Attitude towards and trust in leader

The forces in the situation The nature of the problem/situation

Resource constraints including time

The culture of the organisation

BLAKE MOUTON GRID

The grid shows five leadership styles

the first number shows the task orientation i.e. the concern for production

the second number shows the employee orientation i.e. the concern for people

BLAKE MOUTON GRID

1,1 Impoverished management

An impoverished or indifferent style

Little concern for people or task

Management avoid responsibility and accountability

Blames others

1,9 Country club management

An accommodating style

Motivates and engages by looking after the needs of employees

Relaxed atmosphere with no pressure to meet targets or get work done

Social nature of the workplace is important

BLAKE MOUTON GRID

9,9 Team management

A team style

Managers show high concern for both people and production

Treats workers as a core asset

Achieve productivity goals as a team

9,1 Authority obedience

A produce or perish style

Managers want to control and dominate workers

Orders must be followed

Workers are treated as a resource like any other

BLAKE MOUTON GRID

5,5 Organisation man management

A middle-of-the-road style

Compromise is made between concern for people and concern for production

May influence corporate objectives e.g. an objective of profit satisficing over one of profit maximisation

Which style of leadership would best suit you in relation to your academic studies? Justify your answer.

BLAKE MOUTON GRID – IN PAIRS

In pairs think about big businesses with which you are familiar. Carry out some research to help support your decisions. Place each business on the matrix below.

SHOW OFF YOUR KNOWLEDGE

Can you use the leadership styles on the left to explain:

Tannenbaum Schmidt continuum

Blake Mouton grid

Autocratic Democratic

Laissez-Faire

Paternalistic

Bureaucratic

THE EFFECTIVENESS OF DIFFERENT STYLES OF

MANAGEMENT AND LEADERSHIP

Effectiveness means:

the ability of a business to achieve its objectives e.g. financial performance, competitive advantage and social

Different styles will be effective in different businesses and situations:

a laissez faire or subordinate centred style may work in an environment where employees are highly skilled with an objective of innovation

Where quick decisions need to be made and a situation handled such as a work place accident or environmental disaster an autocratic manager centred approach will be more effective

2 .1 .1 UNDERSTANDING MANAGEMENT , LEADERSH IP AND DEC IS ION MAK ING

In this topic you have learnt about

What managers do

Types of management and leadership styles and influences on these

The effectiveness of different styles of management and leadership