Role of a Leader in a Small Property Business, Democratic and Laissez-Faire Styles of Leadership - Essay Example

The Role of Leader Table of Contents Introduction 3 Theories of Leadership 4 Role of a Leader in a Small Property Business 7 Democratic Style of Leadership 8 Laissez-Faire Style of Leadership 9 Conclusion 11 References 12 Introduction A leader is a person who guides his subordinates in their activities or work. He motivates them to work better and within the time limit so as to attain the desired objectives of an organization (Winston & Patterson, n.d.). In other words, leadership is the ability of a person to guide and motivate his/her followers to put much effort towards the success and effectiveness of the organisation. Leadership even motivates the people to improve their performance related to work and creates a positive change within an organisation. Leadership provides a new way of thinking as well as generate new ideas for effectiveness of the organizations in relation to the attainment of the organisational objectives. Leadership generally aims to bring out the best in people to make them work better and achieve a common goal (The ASPIRA Association, n.d.) In addition, leadership can also be referred as a function of creating a vision in order to obtain the desired objectives of the organisation successfully by guiding the workforce, communicating and even building trust among them and the leader so that they can work better (Oklahoma State University, 2006). The main aim of this paper is to understand different theories of leadership and their application in the organisation. Furthermore this paper will also describe the different role and style of leaders. Theories of Leadership The role of every leader is different from one another. Leaders are often observed to develop their own style of leadership and follow different leadership theories according to the requirement of the situation that they need to face in their organisations. In this regards, various theoretical frameworks or theories have been developed which explains some of the major leadership traits possessed by leaders. A few of the theories are Great man theory, Trait theory, Contingency theory, Transformational theory, Behavioural theory, and Transactional theory. According to great man theory, it is believed the people are born to lead. Leaders develop their own leadership qualities. This theory includes the members of high personality, industrial heads. On the other hand, trait theory is quite similar to the great man theory. The theory emphasizes on physical traits, tasks assigned to the leader, and social as well as personal ability of the leader among others in order to explain the leadership style. However, the contingency theory is more progressive. As per the contingency theory, leadership style should be consistent with the situation faced by the organisation to achieve the goals and objectives. In transformational theory the leaders are often observed to build a trust amid the organisational participants, motivate and engage with subordinates to increase the morality of the followers as well as the leader. The leaders also help the followers to develop their potentials and satisfy their needs with the aim to attain the desired organisational goal (Transformational Leadership, 2010). In the similar context, behavioural theory attempts to highlight the effectiveness of a leader. The behavioural theory mainly focuses on the perceptions, actions, and activities of an individual while performing any task, based on previous experience. This theory is a type of mental understanding which facilitates the actions of an entity. This theory also helps an individual or leader to take accurate decisions, which would be beneficial in accomplishing the assigned duties. It measures the confidence level and loyalty of the leader that how well they can lead and execute strategies into actions. In this theory it is believed that one has to learn effective leadership as human beings are not born with the required qualities of a good leader and thus need to develop the leadership qualities. Apart from this, in behavioural theory, democratic style of leadership is followed which includes free flow of information or facts within the leaders and the followers. In this type of leadership style every individual of a group has the right of providing their views and ideas among others (United Nations Public Administration Network, 2010) Transactional theory, which is considered as another major leadership theory mainly highlights on the informal nature of the working environment which involves mutual coordination, decision making and harmonization among the employees in organizational hierarchy. In this regard, it has often been affirmed that laissez-faire leadership style is followed in transactional theories. The employees or followers in this type of environment share a mutual dexterity and synchronization among themselves which would be beneficial for organization in the long run. It might also enhance employee morale and profitability of organization. Apart from this, transactional theory also states that the followers or employees must follow the orders of their leader(s) strictly and perform the task assigned accordingly to maintain the hierarchical system. If the followers perform their task efficiently and within the specified time period then they are praised and rewarded on the basis of their contribution. Followers are strongly motivated by the leader(s) when performing the task in an efficient and effective manner. One of the most significant features of this theory is that it focuses on a participative working environment where superiors and their subordinates can have equal contribution to the organisational decision making process. Hence, this theory is often suggested to be one of the most applicable theories when implementing change within an organization. In the similar context, the theory also emphasizes on the fact that both the leader and the followers should abide by the rules and the regulations enacted in the organization (Academy of Management Review, 1987). The transactional theory can be regarded as appropriate for a small property business because the leader(s) and the followers tend to consider a participative working progress which is quite essential for a small scale business to prosper. It is worth mentioning that employee satisfaction and lower attrition rate with proper utilization of resources are a few vital factors considered for the growth of a small business which can be attained through the implementation of this theory. Leader(s) and their subordinates render keen interest in taking valuable decisions, regarding the growth and success of the business which can again assist the small business to grow sustainably. This theory is fundamentally based on the performance of workforce which enhances the profitability of the small property business. Moreover, it motivates to work with more dedication and commitment which improves the corporate image and brand identity of the small property business among others in the market. It would also be helpful for a small property business to retain its market share in the long run, which might be beneficial to sustain in the competitive environment. Hence, it can be depicted that as transactional theory mainly focuses on participative organizational culture, which means laissez-faire leadership style is followed (University Of Arkansas, n.d.) Role of a Leader in a Small Property Business The role of a leader in a small property business is fundamentally to identify the goals of the organization along with the formulation of effective plans and strategies followed by its final execution towards the desired objectives. The leader attempts to motivate the followers so as to enhance the commitment and devotion towards work. This would improve productivity of the small property business as well as the followers. Moreover, as the leader is the representative so he attempts to encourage all the members in order to attain the objectives of the small property business. It would also lead to fulfilment of individual objectives as well. In addition, the leader also supports all its followers being a philosopher or a guide so as to achieve its objectives. Furthermore the leader also communicates information among the lower level followers so as to maintain a uniform culture in the small property business. This would enhance the transparency of the business among the employees as well as among the customers thereby improving the relationship among them (Adair, 2006). This would also improve the market share and profitability of the small property business among others. Thus, it can be avowed that the role played by the leader is the most vital as it improves the corporate image of the small property business in the market. In order to gain efficiency in executing strategic decision-making process along with proper allocation of resources in a cost efficient as well as time efficient manner, the small property business should emphasise on experienced and skilled workforce. The leaders should abide by the rules and regulations of the small property business and lead their subordinates adapting required changes in the business with alterations in their roles accordingly (Johnson, 2008). Therefore, in a small organization, such as the small property business, the role of a leader is not only to develop strategies and plan the organisational functions accordingly, but is also related to the execution of the process by empowering the workforce and taking corrective measures for the cost efficient allocation of resources. In this regards, the leaders require to monitor almost every segment of the organization taking into consideration the Human Resources, production, distribution, marketing as well as finance. Hence, the leadership styles required in the small property business can be regarded as quite distinct which can be better explained through the theoretical explanation of two most vital styles, i.e. Democratic leadership style and Laissez-faire leadership style (Mullins, 2005). Democratic Style of Leadership Democratic style of leadership is also known as participative leadership style. According to this type of leadership style before making any kind of decisions regarding the small property business, sufficient information should be gathered so as to enhance the efficiency and effectiveness of the small property business. It is also essential in order to improve its profitability and uniqueness in the market. This type of leadership style also encourages the team members to make valuable decisions and solve the problems faced according to the requirement. The members should be informed about the working condition that might affect the work and help to achieve the desired goal. In this process the leaders shall be able to develop the plans and strategies and evaluate it in an effective manner so as to improve the performance level of both the business and the employees following the democratic leadership style. It is more effective when providing opportunities to the members developing higher satisfaction amid the workforce. Democratic style of leadership encourages the team members of the small property business to participate in a well defined manner so as to build a healthy working team (Pride & et. al., 2009). Laissez-Faire Style of Leadership Laissez-faire style of leadership is also known as ‘hands-off’ leadership style. When following this leadership style, the leader depicts less concern regarding the rules and regulations enacted in the workplace. Minimum direction is provided for the work and freedom is given to the followers. At times the team members do not care about what is going on in the business, how the work is to be done and even the time table of the work allotted. In this type of leadership every follower is free to take their own decision which might be beneficial for the small property business in the long run. In this type of leadership style the team members or the staff members are responsible for determining the goals and objectives and are sole decision makers to solve the problems (Pride & et. al., 2009). In a small property business as mentioned above democratic style of leadership should be followed in spite of laissez-faire as it helps in proper designing of the rules and policies required for the betterment of the business. Democratic style of leadership helps in proper growth and development of the business as compared to the laissez- faire which would augment its image among others in the market. Thus, it can be said without much doubt that democratic style of leadership is much more beneficial than laissez-faire in case of small property business. With due consideration to the fact that only a particular leadership style might not be appropriate for the small property organization, a balance should be maintained between these leadership styles when implementing. Leadership and management are liable enough to strictly follow the regulations of the business, coordinate and communicate well for achieving the goal in an efficient manner. Notably, the vision should be clear as to what should be done for achieving the target (University of Kentucky College of Agriculture, n.d.). For instance, in the small property business a target was determined to be achieved within a given timeframe. In this context, it was not clear which leadership style should be followed due to the lack of the experiences of the leader and information or facts. Moreover, as in a small property business, large number of complexities exists so it is always appreciable to distribute the responsibilities according to the skills or expertise of the team – members. Hence, it was decided to divide the team in two and one should follow the democratic style and the other should follow the laissez-faire. Besides, it was observed later that democratic style was appropriate and could achieve the target in time while the other one failed as they did not create any interest in their task which was assigned. From this situation it is found that democratic style of leadership is good enough for the small business with the purpose of attaining competitive advantages beneficial for the business (University of Kentucky College of Agriculture, n.d.). Conclusion From an overall point of view, it becomes quite apparent that apart from setting the clear goals and objectives, leadership in the small property business should also be improved in guiding and depicting the right path thereby reducing the discrepancies and improving the productivity and efficiency of the team members. As per their performance, the workforce may be rewarded for good performance so as to motivate them for better performance (Practical Management, 2012). It is worth mentioning in this context that leadership plays a very important role in small property business. A leader must follow his/her duties well in guiding the subordinates. In a small property business, both the leader and the management should undergo a mutual understanding so as to determine plans, policies and budget in an efficient manner. Along with this, appropriate distribution of the resources can also be possible which would enhance the total revenue of the business organisation (Pride & et. al., 2009). References Adair, J., 2006. Leadership And Motivation; The Fifty-Fifty Rule And The Eight Key Principles Of Motivating Others. Kogan Page. Academy of Management Review, 1987. Transactional and Transformational Leadership. Transactional and transformational leadership: a constructive/ developmental analysis, pp. 648-657. Mullins, L., 2005. Management and Organisational Behaviour 7th Edition. Pearson Education. Oklahoma State University, 2006. Our Definition of Leadership. Leadership Definition. [Online] Available at: http://www.teal.org.uk/leadership/definition.htm [Accessed February 18, 2012]. Practical Management, 2012. What is the Role of a Leader in an Organization. Role of an Organizational Leader. [Online] Available at: http://www.practical-management.com/Leadership-Development/Role-of-an-Organizational-Leader.html [Accessed February 18, 2012]. Pride, W. M. & et. al., 2009. Business. Cengage Learning. The ASPIRA Association, No Date. Leadership Styles. Defining Leadership Styles. [Online] Available at: http://www.aspira.org/files/documents/youthdev08/U_V_M_5_dls.pdf [Accessed February 18, 2012]. Transformational Leadership, 2010. Transformational Leadership vs. Transactional Leadership. The Transformational Leadership Report, pp.1-19. United Nations Public Administration Network, 2010. Basic Leadership Styles. Leadership Styles [Online] Available at: http://unpan1.un.org/intradoc/groups/public/documents/unssc/unpan024704.pdf [Accessed February 18, 2012]. University of Arkansas, No Date. Seven Common Views of Leadership. Leadership Theory Simplified. [Online] Available at: http://www.uaex.edu/Other_Areas/publications/PDF/FSPSD200.pdf [Accessed February 18, 2012]. 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