Transforming Your Leadership Culture - Case Study Example

Review of leadership and management of TESCO Plc Contents Introduction 3 Discussion 3 Role of leadership in relation to change 3 Analysis of leadership style of TESCO Plc 5 The Role of Management using Henri Fayol’s Theory 6 Difference between management and leadership 7 Leadership is the function of a single person or a number of people in TESCO Plc 8 Conclusion 8 Reference List 10 Introduction Leadership is one of the most important aspects of Organizational Behaviour that shows a person’s aptitude to understand organization’s objective and translate it into reality by influencing all the employees towards achieving a common objective (French, 2011). As uncertainty prevails in global business scenario, techniques of leadership vary according to the changes in technology, economic and financial occurrences. It is impossible to eliminate such ambiguities from business process. Hence, it becomes the leaders’ responsibility to formulate strategies and show right path to all the employees in order to sustain in the business scenario in the long run. For the purpose of analysis, the leadership and management style of TESCO Plc will be critically reviewed in the light of role of leadership in management, the difference between leadership and management, theories and practices of management related to TESCO Plc. TESCO Plc is a multinational superstore in food retailing industry operating in more than 12 countries across world. Strong leadership and management have driven the company to operate successfully in the UK as well as in Europe, Asia and North American Market since 1919 (TESCO Plc, 2014). The nature and style of leadership pursued by TESCO Plc will be discussed below. Discussion Role of leadership in relation to change As a result of operating since 1919 in the UK market, TESCO Plc has encountered various transformational and structural changes from time to time. Such changes largely affects the organizational framework; therefore effective leadership is defined when the leads become successful in efficiently managing resistance to change among all the employees (Grieves, 2010). With the skill and knowledge gained from long experience of working in corporate environment, leaders always tend to formulate strategies and bring required changes in align with the economic condition and industry position. The leaders also identify the potential barriers which may arise in the time of incorporating change process and take initiatives to address such issues well in advance. Experts have recognized certain traits which are inevitable for a leader to manage and control organizational changes. Those traits are attributed in the tabular format. Figure 1: Leadership Traits required for Change Management (Cummings and Worley, 2014) Role of leadership also changes in the various stages of change process. For instance, logical influence is required to be implemented on employees in the planning stage of change process whereas in the introduction and maintenance phase, supportive leadership style should be exercised for minimizing resistance to change among employees. Similarly, the leaders in TESCO Plc concentrate on formulating strategies according to business needs and tend to implement the decisions of the management through translucent and effective communication with the employees. During the change process, the leaders strive for motivating the employees towards the new working process and integrate their work effort with performance based appraisal and reward systems. The strategic leaders clearly define the mission taken by the company for the certain period of time and influence employees to work towards achieving the objectives. Hence, the secret behind TESCO Plc’s long term success factor may be summarized as the leaders’ effort of the organization to bring strategic changes from time to time and successful implementation of the changes though their command on motivation, communication and control (Cummings and Worley, 2014). Analysis of leadership style of TESCO Plc Depending on the nature of business and organizational environment, various leadership styles can be experienced. Laissez-Faire leadership style is characterised by lack of supervision and direct control on employees. Hence, if not implemented on highly trained and motivated group of employees, the style leads to hinder production process which in turn reduces organization’s profitability. In contrast, Autocratic leadership style allows close supervision and imposes the management’s decision on employees. Democratic and Transactional leadership believe in participative management and reward based performance evaluation respectively whereas Transformational Leadership style incorporates high degree of communication for enhancing employee motivation, productivity and efficiency (M. A. Adeniyi and J. A. Adeniyi, 2010). Figure 2: Leadership Trend of TESCO Plc (M.A. Adeniyi and J. A. Adeniyi, 2010) The TESCO Plc mainly adapts democratic style of leadership. Therefore, the management believes in employee participation in decision making process and working together for organization’s betterment. Understanding the key success factor of TESCO, the leaders continuously motivate the employees for providing better customer services. Management also gives emphasis on appointing team leader in each department and communicating the management’s strategic decision to the employees through these leaders in order to clarify their roles in organization so that the employees don’t divert from their responsibilities. Leaders also influence the managers of small units to take necessary decision for smooth running of their operations. For instance, duty manager of each store takes necessary decision regarding employee management; stock and inventory control so that they can fulfil all the customer demand and derive customer satisfaction. Daily and weekly audits are conducted in each store of TESCO Plc for identifying and resolving issues and improve store standards. As a result of incorporating a democratic leadership style, the company’s operations are highly decentralized and flow of communication is directed from top management to subordinates. Innovative ideas from employees across all levels are always appreciated McGuire and Rhodes, 2009). TESCO employees are empowered by the leaders through their declaration of performance based reward benefits such as offering holiday packages, family health protection schemes to safeguard future, discount cards for shopping in TESCO and added advantages in pension plan. Customer management is given huge importance from the management side and mystery audit, customer feedback etc are done from time to time in order to understand customers’ need and accordingly strategies are formulated in order to achieve 100% retention of customer base and increasing customer loyalty (McGuire and Rhodes, 2009). The Role of Management using Henri Fayol’s Theory Henry Fayol is one of the eminent Organizational behaviourists who developed great organizational theory which is famous as Fayol’s fourteen Principles of Management. The fourteen principles suggested by Fayol hold importance in today’s business context as well for organizing, planning, controlling and forecasting business requirements of the management (Armstrong, 2009). These are: Division of human resource in particular departments and assigning specific responsibilities to every individual according to their skills is highly practices by TESCO Plc which is evident in their departmental segments. Though authority is centralized to the top management, a certain degree of authority is delegated to the team leaders such as store in charges to take decision regarding stock and inventory management of their outlets (J. C. Wood and M. C. Wood, 2002). TESCO highly complies with rules, regulations and disciplines as stipulated by the management. However, unity of command does not hold relevance for TESCO Plc as an employee may receive instruction from the line manager as well as the departmental head say for instance, from the store manager and from the inventory manager of TESCO. As recommended by Fayol, a particular group in TESCO Plc works together in order to accomplish a particular task. Subordination and remuneration are also practices as all workers are directed towards accomplishing organization’s goal and they are paid accordingly for their kind effort. Line of authority is streamlined as per scalar chain and managers show equitable behaviour to the subordinates. Employee turnover is less as compared to industry standards and stability is established by management’s initiative to provide timely incentives and other non tangible benefits to the employees. Finally, TESCO Plc encourages team spirits to bring harmony among all outlets across the company (J. C. Wood and M. C. Wood, 2002). Difference between management and leadership The concept of Management and Leadership largely differs in an organizational framework. The main object of leadership is to make decision, influence, motivate and inspire people whereas managers aim at organizing the available resources in order to achieve the organizational objective. A manager receives orders from his supervisor and drives his team accordingly to get the job done. Such orders flow from the leaders who are involved in decision making process. In TESCO Plc, strategic management team and leaders work conjointly to achieve the organization’s mission. The strategic management group formulates strategic decision and delegates the responsibility of implementing such decision in organizational context to the leaders through effective communication. Leaders are also directed towards supervising the employee performance and motivating them to improve quality of work by providing rewards. Strategic management devises the mission, vision and values for TESCO and appoints CEO, MD and Presidents for successful application of these statements in organizational behaviour (Kelly, 2004). Hence, successful running of TESCO by these key people is highly associated with the strategies taken by quality management. Therefore, in TESCO Plc, management and leaders work conjointly for the purpose of realizing organizational goals. Leadership is the function of a single person or a number of people in TESCO Plc After analysing leadership tends of TESCO Plc, it can be understood that leadership is not a function of single person. Many leaders have contributed towards the organization’s success from time to time. Leadership should be seen as a blend of team building and sustaining, task achievement through combined effort as well as individual development. For instance, Terry Leahy, the most famous CEO of TESCO had driven the company through exercising three power factors such as legitimate, expert and referent power towards the employees and mould the employee base in such a way so that they strive to achieve organizational objective. Dave Lewis, the present CEO of TESCO Plc analyses the past trends of leadership and accomplishes his mission by influencing the group behaviour through this composed judgements. Hence, in particular, leader is not born to serve the organizational purposes. Leaders emerge from the workforce itself through their ability to integrate and influence the workforce across the globe and by understanding the requirement of the changing customer base as well as increasing employee expectations. Therefore, success of a leader can be portrayed as the success of the total workforce operating in TESCO because of the fact that followers are the key behind the success of a leader (Burgoyne, Hirsh and Williams, 2004). Conclusion After reviewing leadership and management of TESCO Plc, it can be concluded that implementation strong leadership traits into business practices have aided the company to sustain in the long run. The leaders’ capability to control and implement organizational changes effectively, to incorporate Fayol’s management principles into the management practices and to establish collaboration & cooperation between management and organization as well as their attempt of working jointly with employees have largely contributed towards the success of TESCO and the company will continue to enjoy the success if such leadership style is exercised in future as well. Reference List Adeniyi, M. A. and Adeniyi, J. A., 2010. Effective Leadership Management. Bloomington: AuthorHouse. Armstrong, M., 2009. A Handbook of Human Resource Management Practice. London:Kogan Page. Burgoyne, J., Hirsh, W and Williams, S., 2004. The Development of Management and Leadership Capability and its Contribution to Performance: The evidence, the prospects and the research need. [PDf] Available at: [Accessed 23 December 2014]. Cummings, T. and Worley, C., 2014. Organization Development and Change. Stamford: Cengage Learning. French, R., 2011. Organizational Behaviour. Oxford: John Wiley & Sons. Grieves, J., 2010. Organizational Change: Themes and Issues. Oxford: Oxford University Press. Kelly, J., 2004. Corporate Leadership: Reflections of a CEO and CEO Advisor. Science Direct, 37(5), pp. 389–398. McGuire, J. B. and Rhodes, G., 2009. Transforming Your Leadership Culture. New York: John Wiley & Sons. TESCO Plc, 2014. Board and Executive Committee. [Online] Available at: [Accessed 23 December 2014]. Wood, J. C. and Wood, M. C., 2002. Henri Fayol: Critical Evaluations in Business and Management. London: Taylor & Francis. Read More