E-Banking and the Leadership - Essay Example

?Leadership Leadership is a critical management skill which can be defined as the ability to motivate people towards a common goal. Leadership is a social and interactive process where a leader influences behaviours of followers after his acceptance in the relevant position. Leadership and management are closely related but it can be easily said that leadership ability is an essential part of managing effectively. The differences between management and leadership lie in their motivation styles. For leaders, the leadership styles tend to be transformational or transactional whereas mangers tend to be more authoritative. Leaders have a vision and they are oriented towards driving a change. As for managers they are more focused on adapting to changes and implementation and achievement of goals. There is also a difference between the personality types of leaders and managers. While managers tend to try to achieve stability leaders are more inclined towards risks from changes. (Brown, 2009) Thus it may seem that management and leadership emerge from different ends of the spectrum but in reality the qualities of a good leader and manager compliment and enhance each other. Thus though these are two different approaches they tend to work well with each other bringing about the best in the organization and from its people. Leadership and management has been a focus of many studies which have traced the roots of leadership characteristics as well as studied the different kinds and dimensions of leadership. A brief overview of these studies done over a long period of time is taken to draw conclusions about leadership and the basic differences between management and leadership. Areas of leadership There are different functions of a leader which have been by John Adair (Adair, 1983). These are identified as 1) Achieving the task which includes activities that are directly related to getting the work done. They can be planning, allocation of resources, budgeting etc. 2) Building and maintaining a relationship which includes activities such as building the morale of the team, maintaining discipline or establishment of subgroups in the workforce. 3) Developing the individual includes tending to the personal problems of subordinates, reconciliations and training of individuals. There are multiple theories of leadership which explain whether leaders are born or evolved. They also describe the kinds and the qualities of effective leaders. There are also studies which identify different types of leaders. As compared to this the basic management functions consist of Planning, organizing, leading, controlling, decision making and problem solving. The University of Iowa studies The University of Iowa studies in the 1930's identifies 3 broad styles of leadership. They were labeled authoritarian, democratic and Laissez fair. The authoritarian leader was directive I his style and did not encourage participation from his followers. The democratic leader encouraged discussion and participation and tried to be objective. Nevertheless he was the one who made the decisions. In contrast the laissez fair leader allowed complete freedom to the followers to make and follow their own decisions. (Martin, 2005, p. 351) Trait theory These traditional theories of leadership include the Trait theory of leadership which distinguishes leaders from non-leaders. It says that there are personal qualities and characteristics which define a leader and that leaders are born and cannot be made. Leaders are described as courageous, enthusiastic and charismatic and examples include Mahatama Gandhi and Nelson Mandela. Research later validated that all leadership traits can be broadly categorized under the Big Five traits of leadership which were extraversion, conscientiousness, openness to experience, agreeableness and emotional stability. Recent studies have also found that emotional intelligence is strongly linked to effective leadership. (Robbins, 2010, p. 174) Behavioural theories The behavioural theories of leadership focused on observable behaviours rather than underlying traits of leaders. The relative advantage of the behavioural approach is that it assumes and states that behavior can be learnt and thus effective leaders can be trained. Ohio State studies Ohio State studies in the late 1940's are one of the main determinant behind behavioural theories' conclusion. It narrowed down the list of leadership dimensions into two basic categories which accounted for most leadership behaviours. They were described as initiating structure and consideration. Initiating structure is best defined as the extent to which the leader is likely to define and structure his and his employee's roles and works. Consideration can be defined as the extent to which job relationships can be defined by mutual trust and respect and regard for employers. (Robbins, 2010) Research and later studies have validated that both initiating structure and consideration are likely to be essential for effective leadership. University of Michigan studies These studies were conducted at the same time as the Ohio state studies with the same mission if identifying behavioural characteristics. These identified two types of leader behaviour which could be labelled as people oriented and product oriented. The conclusion reached by these studies was that effective leaders are more employee oriented that is they are more concerned about the welfare of their employees and can empathize with them. (Northouse, 2009, p. 70) Charismatic and transformational leadership Leaders are individuals who inspire people through their words, ideas and behaviour. The theories of transformational and charismatic leadership explore how a leader inspires through communication with his followers. Robert House has described charismatic leaders as leaders who have a vision, who are willing to take risks, who are sensitive to their followers needs and who exhibit behaviours which are out of the ordinary. (Robbins, 2010, p. 180). Researchers also agree that charismatic leadership can be situational and charismatic leaders may effect some people more than others. Transformational leaders have been identified as leaders who have an extraordinary effect on their followers so much that they can sacrifice their own interests for the greater good. This profound effect is achieved by paying attention to the needs of the followers and fulfilling them. Contingency theory of leadership Fiedler's contingency theory of leadership states that leadership styles are greatly dependent upon situations and tries to match the right situation with the right leadership style. It states that effective leadership is contingent on matching the leader's style to the right setting. (Northouse, 2009, p. 111) It revolves around the Least Preferred Co-worker scale. It separates people who are high, medium or low on this scale. People who are relationship motivated are on this scale whereas those who are task dependent are low on this scale. The conclusion reached is that low LPC's are effective in extreme situations whereas high LPC's are preferred in moderate situations. (Northouse, 2009, p. 124) Path Goal theory of leadership This theory links leader behaviour with employee motivation and satisfaction. Four broad leadership styles were identified which were 1) Directive leadership where the leader provides precise instructions on what and how work is going to be done. 2) Supportive leadership where the leader adopts a friendly and concerned approach towards the welfare of his employees. 3) Participative leadership where the leader seeks opinions and suggestions from his subordinates regarding decision making. 4) Achievement oriented leadership where the leader focuses on tasks and sets challenges for his employees. (Martin, 2005, p. 360) Peter Drucker, one of the greatest authorities on leadership has identified that one of the tasks of the leader is to be involved in continuous learning. (Drucker, 1999 , p. 235) Continuous learning helps improve performance and enhances the individual by catering to his or her personal needs. It grips two basic problems which are rife in many organizations which are resistance to change and innovation and obsoleteness. Another prerequisite for an effective leader is planning and taking responsibility for his own job. Proper planning is the heart and soul of all tasks and to plan for himself and his followers is termed as one of the obligations of a leader. Thus management revolves around basic functions of planning, organizing, leading and controlling with assurance. This implies that leadership is a subset of management and both are necessary for effective corporate growth. Leadership risks create opportunities while it is the management strictness which is necessary to change them into tangible results. But as most leadership theories have found that leaders are innate, management is a skill which can be learnt easily with experience and observation. Management is also more rigid as compared to leadership which is expected to be more flexible depending upon the needs of the situation. Conclusion Thus effective leadership is the force required to motivate, nurture and guide individuals for optimum performance. Effective leaders inspire their followers to function effectively. Various leadership styles have been identified which include the authoritarian, democratic and the Laissez fair style of leadership. Various studies on leadership have identified common traits belonging to almost all leaders. These traits have been classified as the Big Five Traits of leadership. Other theorists believe that it the behaviour of leaders which causes them to be effective and have identified initiating structure and consideration as two core values. These behavioural theorists also believe that leaders can be trained as opposed to trait theories which say that leaders are born. Contingency theories identify different types of leaderships in different organizational settings and which leadership styles are most appropriate in extreme or moderate settings. Finally the most contemporary approaches towards leadership identify charismatic and transformational leadership as two types of extreme motivation inducing leaderships. Continuous learning and proper planning are also identified as two hallmarks of extremely effective leaders. References Adair, J. (1983). Effective leadership: a self development manual. Gower. Brown, S. (2009, May 10). The Difference Between Management & Leadership. Retrieved March 13, 2011, from www.suite101.com: http://www.suite101.com/content/the-difference-between-management-leadership-a116336 Drucker, P. F. (1999 ). Management:tasks, responsibilities, practices. Gulf Professional Publishing, . Martin, J. (2005). Organizational behaviour and management. Cengage Learning . Northouse, P. G. (2009). Leadership:Theory and Practice. SAGE. Robbins. (2010). Essentials Of Organizational Behavior, 10/E. India: Pearson education. Read More