Transformational Leadership Skill - Case Study Example

Relationship between Change, Leadership, and Organizational Performance Introduction Organizational change and organizational performance are two interconnected functions. The need for organizational change is arises when the performance of the organizational activities does not come up to the expectations of the managers. The role of leadership in the implementation of required changes is very important. Leadership is the skill of a person to inspire a group of people towards achievement of some specific goals and objectives. Leaders motivate employees to struggle for the required changes in the organizational culture and activities. The thesis statement for this paper is that ‘leadership functions, organizational performance, and organizational change are all interrelated functions’. 1. Organizational Change Before going to discuss the relationship between change, leadership, and organizational performance, let us get an overview of organizational change in order to get a better understanding of the relation ship. Organizational change refers to those changes that occur in the organization due to the influence of various external and internal forces. Rasing (2010) states, “The key to organizational change and development lies in the understanding of peoples requirements and work towards it”. External and internal forces of change not only affect organizational policies but also but also affect the major functions of management. Two of the main external forces of change include competitive environment and technological development. Competitive environment forces the organizations to retain quality of the products and services in order to increase customer retention and satisfaction. Technological development means keeping the technology up to date for the organization in order to remain competitive in the market. On the other hand, internal forces of change are those forces which force the change to occur inside the organization. Some of those changes include change in employment rules and regulations, change in the working atmosphere, and change regarding employee retention strategies. 1.1 Barriers in Implementing Change Some of the most famous models of change include the Burke Litwin model, 7-S model, and Mateso’s organizational change model. While implementing any new model of change, there come some barriers which need to be overcome effectively in order to implement the change model. Following are two common barriers which come in the way of implementing of an organizational change model in a company: 1.1.1 Training of Employees One of the barriers is the training of employees regarding use of newly implemented software and technology. Employees’ limited computer awareness results in failure of technological change because it does not always allow an employee to fully absorb the capability of the new application. 1.1.2 Inadequate Planning Another barrier is inadequate planning. Implementing a strategy regarding business may not successfully work unless sufficient education and training is provided to the employees in order to realign them with the new company direction. 2. Organizational Performance Organizational performance refers to the performance of organizational strategies and functions. Managers make use of different methods to monitor performance of organizations. One of the most common methods is balanced scorecard. McNamara (n.d.) asserts, “The Balanced Scorecard is a performance management approach that focuses on various overall performance indicators”. A balanced scorecard is used to make an alignment between business vision and business strategies. It is also used to improve business communication and to monitor organizational performance. Employees need to know their roles and responsibilities regarding implementation of changes. A balanced scorecard makes employees aware that taking part in the successful implementation of change is the job of every employee. It also motivates leaders to enforce necessary changes in the organizations. A balanced scorecard injects a sense of motivation in all business processes and provides a mechanism to the managers to judge performance against the goals of the company. A balanced scorecard is different from a traditional performance management system in a sense that a balanced scorecard considers business vision and strategies to measure actual performance of the employees whereas traditional performance management system defines key result areas and establishes performance standards for the achievement of each goal and objective. 3. Leadership Leaders are such people who work with in collaboration with other people for the achievement of some specific goals and objectives. Motivation and interpersonal communication are such elements, which play a critical role in the achievement of desired goals. It is the role of the leaders to continuously motivate other people and employees in such a way that every employee works towards the mission under the guidance of the leaders. In organizations, managers can also function as leaders to bring required changes in the organizational policies and structure. Managers first detect flaws in the system and if they find some flaws, they do proper planning to remove those flaws. However, managers cannot implement the changes without the support of the concerned employees. Therefore, they communicate the flaws to the concerned employees and motivate them to support the need of change. Here, one point that needs to be mentioned is that managers need to support efforts of employees continuously to make them work efficiently for the implementation of required changes. Managers can achieve these tasks only if they have a sound understanding of overall organizational structure and behavior. 4. Relationship between Leadership, Change, and Performance Organizational change is a very important process related to roles and cultural management of a company. Organizational change is the restructuring of a company or reshaping the roles of the employees of the company. Organization change is a change in overall behaviors and roles of the employees of a company for bringing improvement in the overall productivity of the company. if we talk about leadership, we can say that leadership is the ability to manage, control, and guide a large number of people in such a way that everyone works with full commitment to achieve the mission under the guidance of the leaders. Rampur (2010) states, “In the corporate world, leadership is undoubtedly the most important action that has to be considered if you want to get the work done collectively”. Effective leadership plays a decisive role in motivating people towards accomplishment of a common mission or desired goals. In organizations, if there is no one to lead the employees towards some required organizational changes, it becomes very difficult for the employees to make a successful struggle towards implementation of any kind of organizational change. In organizational settings, leadership deals with management of people in such a way that every employee becomes fully committed to work for the benefit of the organization. Change can never be brought into an organization without participation of the employees. Leaders carefully analyze the organizational behavior before motivating employees to adapt to any specific organizational change. To achieve organizational goals, leaders should be able to stimulate employees’ behaviors in such a way that employees start recognizing their obligations and responsibilities regarding achievement of goals. If we talk about the relationship between organizational performance and organizational change, we can say that organizational change has direct link with organizational performance. A need for organizational change arises when performance of the organizational strategies does not come up to the expectations. In order to bring changes in the organization’s policies and system, a transformational leader needs to communicate his/her vision to the employees. A leader also needs to motivate the employees to participate in the process of transformation. Shakweh (2010) states, ‘Transformation is a critical component of the entire organizational strategy”. There are some key stages that a leader needs to follow top bring changes in the organizational system. those stages include identifying the need of change, making a plan to implement the change, communicating the vision and mission to the employees, bringing changes in employees’ behavior, tackling the confrontations, managing change to guarantee employee and situational control, and ensuring friendly relationships with employees and the management. The role of leadership is very important in bringing organizational change. A leader not only predicts the need of change but also encourages the employees to support the change. According to Leblanc (2009), leaders offer guidance to followers and request input from the followers. This behavior of leaders makes employees more responsible and committed towards change. Leaders need to educate employees to make them aware of the importance of the change. It is one of the core responsibilities of the leaders to stimulate employees to struggle for the right cause. Leaders make the employees aware of the beneficial outcomes of the required changes in order to increase their interest and commitment for change. They provide a right direction to the followers and guide them throughout the process of change. A leader needs to perform five major functions to bring a positive change in the organization. Those functions or responsibilities are planning, organizing, commanding, coordinating, and controlling. All of these functions play a valuable role in determining success of the leaders. Planning, which is the first managerial function, refers to the formulation of activities that are required to implement changes in the organization. This function of management deals with the development of strategies to bring required changes. Planning helps managers take proper course of actions to achieve desired set of goals. Planning also means to develop a comprehensive hierarchy of activities that are required to control all activities regarding implementation of change. Next function of management is organizing. Organizing means identification of the tasks that the employees need to accomplish for the implementation of change. In this phase of management, a manager identifies key tasks, assigns the tasks to the concerned employees on the basis of their areas of expertise, make and administer teams, and takes care of all activities that are related to the achievement of those tasks. Leading is the next stage in the process of management. This is the stage, which is closely associated with the concept of organizational change. At this stage, leaders motivate and encourage the employees, administer employees’ activities, communicate the need of changes to the employees, create awareness among employees about the opportunities that exist for the employees, and inject passion in the minds of all concerned employees to make them work hard towards the accomplishment of goals. Controlling is the last function of management. Controlling means to supervise or manage performance of the employees. Performing this function, managers observe and assess the performance of employees and weigh the performance against original goals and objectives in order to make necessary changes if required. 5. An Example of Organizational Performance and Need of Change Real Software Technologies is a software developing company, which underwent the process of change due to identification of a need for change. The change that needed to be made was related to upgrading software quality control process of the company. The problem was that the company was unable to satisfy its customers because the software quality control process was not up to date. The company did not use to check the quality of the software products before delivering them to the customers. The result was that many customers used to come back to the company with complaints regarding bugs in the software products. The company needed to hire experienced and well-qualified IT experts to perform quality checking of the newly developed software products. Real Software Technologies needed to do proper strategic alignment in order achieve customer satisfaction and higher levels of profits. The business consultant for the company came up with some recommendations for the company to improve its business. One of the recommendations was to align its business processes with the demands of the market. Another recommendation was to improve quality checking of the software products in order to make them reliable and bug free. Considering the recommendations, the company hired a proficient team of IT experts, which was able to detect all kinds of bugs in the software products. Moreover, the company improved the quality of its software development process to achieve customer satisfaction by providing them with reliable products. 6. Conclusion Summing it up, organizational change and organizational performance are two interrelated functions. The need for organizational change is anticipated based on the performance of the organizational activities. The role of leadership in the implementation of changes is very influencing. Leaders motivate employees to struggle for the required changes in the organizational culture and processes. Therefore, we can say that leadership functions, organizational performance, and organizational change are all interrelated functions. References Leblanc, R 2009, Motivation – A Transformational Leadership Skill, viewed 10 November, 2011, . McNamara, C n.d., Balanced Scorecard, viewed 10 November, 2011, . Rampur, S 2010, Types of Leadership Styles, viewed 10 November, 2011, . Rasing, M 2010, Organizational Change and Development, viewed 10 November, 2011, . Shakweh, Y 2010, Transformational Leadership, viewed 10 November, 2011, . Read More