Construction Management - Caledonian - Case Study Example

CONSTRUCTION MANAGEMENT by Introduction Leadership and management are two terminologies that have been used interchangeably to denote the same thing. It is difficult to separate the two, as there cannot be a management in place without the leadership aspect (Adewale, 2010:25). A good manager needs to have good leadership skills just as a leader needs to understand how to manage the people under his leadership. There is thus a significant correlation between the two ideologies. At the workplace, their use is not only important, but also critical in the smooth running of activities. However, their incorrect application has significant and far-reaching effects on the organization, its customers, its employees, stakeholders and shareholders as well. This paper will thus critically review leadership and the impact it has on customer satisfaction, employee performance, satisfaction and retention. Specifically, it will give a definition of leadership; examine the different types of leadership highlighting their pros and cons. It will then explain the impact that leadership presents at the workplace. Finally, it will give a conclusion and recommendations to the management of Caledonian. Literature review / relevant background research Leadership can be defined in a number of ways. There is actually no standard definition of the word leadership. As discussed in the introduction, leadership and management have closely been related. However, a number of scholars think that the roles a leader and manager play are completely different. According to Grace Hopper, a retired Admiral in the United States Navy, one can only succeed in managing things, and not people. She refers to a battle situation and states that you cannot manage soldiers into a battle, but you can only lead them (Adewale, 2010:59). Murray Johannsen, an author, also contributes to the debate that managers and leaders have very different responsibilities. She defines their roles in terms of the people under them. In her view, a manager has subordinates who answer to him, while a leader commands a following. So what exactly is leadership? Leadership is a way of first winning people’s minds and hearts, and then, through influence and direction, be able to achieve certain desired objectives. The art of winning people’s minds and hearts to attain a level of achievement further entails winning their respect, loyalty and obedience (Armstrong, 2005:32). These are very important in attaining cooperation that will eventually get things done. According to the president of Loden Associates, Marilyn Loden, leadership places strong emphasis on cooperation compared to competition (Stacey, 2012:12). Leadership can also be defined as turning vision into reality. This is regarded as the very first role of a leader in any organization. Different organizations have different visions that are clearly spelt out in the mission and vision statements. What brings out the difference in the performance of organizations is thus how well their visions are interpreted and eventually converted into reality. According to Warren Bennis, President of the University of Cincinnati in the year 1988, the first responsibility of any leader is to first and foremost come up with a definition for an organization, then ultimately transform that vision into a reality (Warren, 2010:53). Lastly, leadership can also be defined by looking at the traits of the leader as an individual. According to President Theodore Roosevelt, a leader makes effort in his obligations, makes mistakes and learns from them, is enthusiastic in his work, acknowledges the achievement of his team members, and is not afraid to fail. Having looked at the different types of leadership, it is useful to understand the term by looking at the various types of leadership. Effective leadership is said to be achieved by selecting the right type of leadership, at a time that is right, and using that type in the right moment or situation. However, many people in leadership positions tend to use only one type or style over numerous situations. There are very many leadership styles, over twenty in number, adopted and used the world over. However, these can be summarized into five; these are the authoritarian or autocratic leadership, the procedural or bureaucratic, the transformational, the democratic, and the laissez – faire type of leadership. While some types are complete opposites of the other such as the authoritarian and the democratic, others can effectively be applied together, such as the Laissez – faire and democratic (Marianne, 2010:39). The correct or incorrect application of either of the leadership types brings about different effects, which will be discussed later. The authoritarian type of leadership has, and continues to be applied to date. It is also referred to as autocratic or transactional type of leadership. This style of leadership is characterized by very high control of the subjects by their leaders and is closely likened to the military mode of leadership. The leader is usually very commanding and controlling, and displays power and might over members of the team under him. It also involves expressly directing team members on what needs to be done, the deliverables, without seeking for any form of thoughts, suggestions, or ideas, regardless of whether these would add value to the output. Autocratic style of leadership is normally applied when team members are difficult to deal with, or when an organization is in a crisis. According to Goleman in his book ‘Primal Leadership’, this style of leadership only achieves results in a crisis. It is considered as least effective when applied in other situations. However, productivity is high among teams under an autocratic leader, but only in his presence. The disadvantage of this type of leadership style is that it lowers job satisfaction and increases resentment (Goleman, 2013:62). The second type of leadership is the bureaucratic. It is also commonly referred to as the task-oriented or managerial. Bureaucratic leadership has closely been associated to the autocratic type. This is because team members have to observe a strict and unconditional obedience to the authority figure. It is widely used in organizations with large team members such as government institutions. Like in the autocratic leadership style, the leadership figure here also exercises control over the team members who strictly abide by the laid down procedures to get a particular job done. As such, little attention is paid to the welfare of members of the team. It is normally used when the task given to a team requires that fine details be observed. For instance, where the task involves machine and plant operation, bureaucratic leadership is observed. The level of organizational planning involved in this type of leadership is usually considered as very good and tasks can be achieved as desired. However, in contrast, the same level of planning works against the organization as it easily demoralizes staffs affecting the delivery of deliverables over time (Goleman, 2013:29). Transformational leadership is considered as the mostly used style of leadership today. It is also referred to as charismatic leadership as the leadership figure uses charisma to motivate and influence team members to achieve a set objective. The current president of the United States, Barrack Obama, is regarded as the best example of leaders in the world who apply this style of leadership. Charismatic leadership entails the delegation of tasks by the leader to other team members. Communication is also widely used and it forms the basis for the attainment of the desired outcome. The team leader in this case devotes most of the time in communicating to the team members the goal and the visions they have for the team (Marianne, 2010:32). However, unlike in autocratic or bureaucratic leaderships, team members in this style of leadership have the freedom to decide how to achieve the goal set by the leader. Charismatic leadership’s main advantage is that it creates a teamwork atmosphere where team members can effectively collaborate. Efficiency and effectiveness in the execution of tasks tends to be very high as team members are highly motivated and have a lot of energy. However, this type of leadership also has its disadvantage. Team members solely rely on the charisma, charm and enthusiasm of the team leader for their motivation and strength. They are also dependent on the charismatic leader to relay the picture or vision he has for the team. Their leader, on the other hand, depends on the team members to deliver the goal to the very fine details. There is therefore a very high level of dependency in this leadership style, without which failure to attain the communicated goal may result (Herman, 2010:76). The fourth type of leadership is the democratic leadership. This kind of leadership, also known as participative or consulting, is usually practiced in situations where an organization is unsure on the direction it should take to attain a particular objective. The level of control the democratic leader has over his team members is medium as he or she has to continuously consult and reason together with the team to decide on the direction of the organization. While the leader in this type of leadership may have the vision or goal that he wants achieved, he has to reach out to the team members and source for their advice and wisdom (Herman, 2010:42). There is therefore room for consensus and the team is usually actively engaged in the decision making process and the team leader will use opinions and ideas drawn from the team to make the final decision. Importantly, unlike other leadership types, members of the team are kept appraised of any changes that may occur and participate in making changes to already formulated policies. However, like in most leadership styles, the leader has the final word. In this leadership style, members of the team are able to come up with better decisions because of inclusivity. They also develop healthy teamwork skills, which further increases their satisfaction on the job. However, democratic leadership may lead to delays in making decision, as the level of participation involved takes a great deal of time. According to Goleman, it can be ineffective especially in times when decisions need to be reached quickly and urgently (Goleman, 2013:23). The fifth and last type of leadership is the laissez-faire or delegative leadership. The style used in this type has been described as a ‘hands off’ (Stacey, 2012:43). This is mostly because the leader in this case is not in the limelight as in other leadership types. The recognition the leader gets is informal and he or she only works to meet the objectives of the team. The level of control is very low as the leader is mostly involved in the roles observation and advising team members. Like in democratic leadership, the whole team is involved, the opinion of team members is highly considered. Unique to this leadership style is that the leader’s participation is as that of another team member. It is mostly used in an organization with very skilled members. Delegation and being fully trusted with responsibilities leads to a lot of job satisfaction. However, the level of staff productivity is usually lower than in other leadership types. Analysis / Critical Thinking/ Discussion Having analyzed the five main types of leadership, it is important to understand how leadership relates to vital workplace factors such as customer satisfaction, employee performance and satisfaction. Employees spend most of their time of the day in the work environment. They are also any organization’s most important asset in the delivery of goals, service and eventually output which consequently affects how customers perceive that organization and generally their satisfaction. It is like a domino effect. In autocratic and bureaucratic leaderships, the level of participation of team members or employees is very minimal, or none at all. This coupled with the high level of control and disregard for opinion leads to high levels of employee dissatisfaction (Warren, 2010:64). Operational performance is also affected, as employees do not have a sense of ownership. Consequently, service delivery to the customer, who is today very choosy and enlightened, is interfered with and their satisfaction dips. Eventually, both employee and customer retention is affected. On the other hand, involvement of team members in decision making such as in the laissez – faire, transformational and democratic leadership types, increases their level of satisfaction. This is because there is ownership of both success and failure in the organization. This always works in the best interest of the organization as operational performance is improved and customers are well attended to and their needs are well taken care of. Conclusions / Recommendations Having suffered from negative feedback from two repeat customers and poor financial results owing to poor employee retention and operational performance, the Caledonian Company needs to urgently address two important things. Firstly, the management needs to establish the type and effectiveness of leadership being used by its managers and team leaders. This can be done through conducting an employee satisfaction survey where employees can freely give feedback without fear of discrimination (Stacey, 2012:45). This will help the organization understand whether the leadership under use should be maintained, reinforced or changed all together to achieve better outcomes. Secondly, the management board needs to deliberately modify its leadership style and incorporate a style that allows for more employee participation. It can depend on results of the survey to do this. Employee participation in decision-making is important because it makes employees feel important in terms of helping the company realize its potential. This means that the company should consider leadership styles, such as democratic, laissez faire and transformational styles that allow for employee participation. The management process at the firm should also reflect aspects of quality employee, customer and investor service. The management should have the interests of these groups among its most important interests and make decisions by considering these aspects. This will ensure all the needs of the stakeholders of the firm are effectively met. Leadership remains a critical aspect in organizational performance. The success or failure is entirely dependent on how the organization is being led. Leadership is the art of winning people’s minds and hearts, their loyalty and respect. This fosters cooperation and gets things done. Employee participation is vital in any organization. While the autocratic and bureaucratic leadership styles have no allowance for this, laissez – faire, participatory and charismatic leaderships make use of it. This consequently results in employee and customer satisfaction, and eventually their retention. The organizations performance is also positively influenced. 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