Management Core Concepts - Assignment Example

Toyota Case Study Name: Lecturer: Course: Date: Introduction The case presents a scenario of Toyota’s Tough Boss. Hiroshi Okuda is the company’s Chairman of the board and has served in the company for over 30 years as president. Okuda can be described as a leader who is change oriented and speaks his mind. Unlike other leaders, Okuda is a more aggressive and outspoken. Okuda believes that his approach of leadership is vital in order to adopt important change. During his tenure as president of the company, Okuda initiated various radical changes in the operations and management of the company. Additionally, Okuda was credited for taking up jobs that other employees declined. Most the projects he undertook were successful. Nevertheless, his leadership approach faced numerous challenges which led to his dismissal from the position of president. This paper seeks to provide a case analysis of Okuda as Toyota’s Tough Boss. The scope of the analysis will be grounded on examining various key issues concerning the concept of leadership. Question 1 The different leadership styles and the most appropriate in different environmental situations and with different categorizations of employees One of the leadership styles that is demonstrated in the case is the job centered leadership style. The job centered leadership behavior involves leaders paying close attention to the work and job procedures and tasks of the employees. The leader pays close attention to performance. The job centered leadership style is effective in work environments that are highly competitive. In such environments, employees are required to produce high performance in order for the organization to maintain a competitive. In addition, the job centered leadership approach is implemented in the bureaucratic and rigid environments. The job centered leadership approach is mainly applied to the surbodinate level employee in order for them to meet the objectives of the organization (Huczynski and Buchanan, 2006, p716). The initiating structure is another style of leadership that is also closely associated to the job centered style of leadership. The approach emphasizes on performance and the achievement of service and product goals. The initiation structure approach works best in environments where productivity is low. The managers or supervisors concentrate on keeping their subordinates busy, which enables them to attain their targets on time (Huczynski and Buchanan, 2006). Another leadership style is the employee centered leadership style. Huczynski and Buchanan, (2006, p716) highlights that the employee centered leadership approach is where the leader is strongly involved in creating a cohesive work group and ensuring that employees attain job satisfaction. The main concern of this approach is the welfare of the workforce at all levels of the organization. The employee-centered approach is suitable for work environments that need to retain their employees. An additional leadership approach is the consideration leadership style whereby the leader is sensitive to the social needs of the employees and is keen on developing relationships (Huczynski and Buchanan, 2006, p716). It can be stated that the consideration leadership style is also closely linked to the employee centered approach which puts more efforts on the employees. The approach is suitable in environments whereby the organization is more employee oriented as opposed to production oriented. The authoritative leadership approach is another leadership style that is adapted in work environments. In this leadership approach, the leader imposes their decisions and never delegates decision-making (Huczynski and Buchanan, 2006, p724). The democratic approach of leadership involves developing a consensus and collaboration with the employees. The leader forges consensus with the employees and has complete trust and confidence in the subordinates. The democratic style of leadership can be practiced in both high productive work environments and in work environments that are low performing (Huczynski and Buchanan, 2006, p724). Another leadership style is the coercive approach of leadership. The approach entails demanding the compliance of the employees. The approach is usually adopted in a crisis of when there is a problem. In coercive leadership, the employees are driven to achieve the objectives of the company (Huczynski and Buchanan, 2006, p724). Question 2 Okuda’s leadership styles One of the leadership styles that is demonstrated in the case is the authoritative type of leadership. Huczynski and Buchanan (2006, p724) highlights that the authoritative type of leadership is embedded in Goleman’s six leadership styles. The authoritative approach entails mobilizing people whereby a leader mobilizes the employees to work towards a new vision or direction that is required. The leader in most cases is usually change oriented and acts as a change catalyst that has self-confidence. From the case, it can be stated that Okuda adopts the authoritative leadership style. In the first 18 months after taking up the position of president of the company, Okuda initiated some drastic changes in Toyota. The business environment at that particular time was very competitive. The company was losing its market share to other companies such as Honda and Mitsubishi. Okuda linked this problem to various factors as a result; he initiated various authoritative decisions in order to implement change in the organization. For instance; Okuda attributed the losing touch of Japanese customers with Toyota‘s products as a factor that was contributed by poor design. For instance, when the engineers redesigned the Corolla in the year 1991 they created a product that was too expensive and too big for the tastes of Japanese consumers. Consequently, the consumers lost touch with product. In order to attract the Japanese consumer, Okuda worked with the designers of the company and influenced them to develop a custom product that would attract the market while at the same time be produced quickly. Okuda also adapted the initiative structure style of leadership. The approach emphasizes on performance and the achievement of service and product goals. When Okuda become president of the Toyota Company, he replaced nearly one third of the company’s highest-ranking executives. Additionally, he added performance as a significant factor for the employees to attain. Such actions can be termed as initiative because Toyota was experiencing low productivity at this particular time as a result, employees were required by the company to perform effectively in order to increase the production of the company. It can be stated that Okuda also adopted the coercive approach of leadership. It can be argued that the reason why Okuda was removed from the position of presidency was due to coercive leadership approach. In 1999 he had overstepped the boundaries with his blatant demand for change and the decline to bail out the members of the Toyota keiretsu who had assisted the first family with funding. The pacesetting leadership style also exists in the case. We see that Okuda sets high standards for the employees to attain essentially in tough times. He develops an initiative then drives the employees towards achieving the objectives of the initiative. Question 3 Explain the terms ‘transactional’ and ‘transformational’ leadership. What form did Hiroshi Okuda exhibit? Cite specific examples in the case study that support your choice Transactional leadership is a leadership approach whereby the leader emphasizes more on the flow of operations in the organization. The leader therefore uses various incentives and even his power in order to motivate the employees. The transactional leader also focuses on effective exchange of resources. The leader therefore gives the followers something they want in exchange for something the leader needs (Judge and Piccolo, 2004, p775). Transformational leadership on the other hand involves a leader who does more with the followers than set up expectations concerning work effort and rewards. Research indicate that they not only reduce work alienation but rather they also motivate their followers to higher levels of effort and self- sacrificing behavior (Davidson, et al , p369). From the case, it can be stated that Hiroshi Okuda adopted the transformational leadership approach. We see that when he gets to the position of president of the company, he changes the long standing promotion system in Toyota based on seniority and adds performance as a factor of promotion. This basically implies that he did not use incentives such as rewards in order to get the results he wants, but rather he used performance as the main factor of promotion. Okuda therefore promoted out- standing performers to higher managerial levels, thus it can be stated that he used the transformational approach of leadership. Also, it can be argued that Okuda used transformational leadership based on the fact that he literally transformed the Toyota company when he took over leadership. Waddell, et al(2012,p186) highlights that throughout history transformational leaders have been credited for transforming their organizations by making sweeping changes to renew and revitalize the operations in their organizations. A case in point is when Okuda changes various areas of operation in the Toyota Company. For instance, the design department was not productive enough and wasted a lot of time in the production process. When Okuda took over power, we see that he works with the designers and directs them to increase their production speed . Cars that were produced in 27 months were now produced within 18 months. This can be described as a huge transformation in the operations of the company. Davidson et al (2009) discloses the fact that transformational leaders usually display attributes of intellectual stimulation. The leaders stimulate their followers to question assumptions and also approach problems in a different way. Okuda undertook various projects that demonstrated the manner in which he is able to approach problems in a different way. For instance, in 1980 Okuda took up the Taiwan manufacturing project despite the reluctance that existed among other members of the organization. This gives an indication that Okuda was able to approach problems in a different way, a factor which demonstrates his ability to apply intellectual stimulation as an element of transformational leadership. Question 4 When a company is in crisis, do you believe that a radical change in leadership is required to turn the company around? Why , why not. Radical change in leadership is a vital aspect when a company is in crisis. As argued by the situational leadership theory, leaders are supposed to behave in a certain way depending on the situation (Bartol, et al, 2007, p412). In order to resolve a crisis in the organization, change in leadership is a significant aspect. As indicated in the case, we see that Okuda adopts radical change in order to resolve the crisis that existed in the company . For instance when the company was losing its competitiveness in the market, Okuda made changes in the top management/ executives and initiated performance as the basis of promotion. It can therefore be stated that during a crisis, radical change leadership is significant. This is because leadership is the ability to influence followers. In the event that the existing leaders are not able to influence followers towards attaining the desired objectives of the organization, then a radical change in management is an effective move. Also radical change in management is important when a company is in crisis based on the fact that by adopting the change, an organization can move from the crisis into a better position. In reality it can be stated that a crisis situation is vital to trigger the necessary changes that are required within an organization (Chitale, et al ,p598). It is within a crisis, that leaders are able to come up with strategic ideas that can assist to resolve an existing crisis. The ideas developed by the leaders will then assist the organization to move from the problematic situation to a better position. As witnessed in the case, we see that Okuda adopts radical changes that improve the market position of the company when many Japanese consumers had lost touch with products from the Toyota Company. When he promotes new leaders on the basis of their performance, then it can be stated that such leaders are able to bring about new ideas in the company which are able to remove the organization from the crisis position. On the other hand, it can be argued that radical changes on leadership is not required in order for the company to turn around. The compelling need for change during a crisis is not a factor that can be determined by the human resource of the management only. If an organization is in a crisis there are various aspects that should be changed. The focus on a radical change on the management can be misplaced. This is because an organization can change the management yet the underlying factors that cause the crisis are not dealt with. The result is that the crisis may continue or even deepen. Thus, it can be argued that during a crisis it can be argued that a radical change on management is not necessary. Conclusion The discussion above has presented a case analysis on the subject of leadership with focus on Toyota’s Tough Boss, Hiroshi Okuda. Okuda adopted various leadership approaches, which include; the job centered approach, the initiative structure approach, coercive leadership and the pacesetting leadership. The paper also took note of the fact that Okuda adopted the transformational leadership approach whereby he was more focused on motivating his followers to higher levels of performance as opposed to rewarding the employees. Also, the paper argued that during a crisis, a radical change in management is vital in order to avert the crisis nevertheless change in leadership is not the only factor that can be used to reserve a crisis. References Bartol, K, Tein , M, Matthews , G and Martin , D, 2007, Management a Pacific focus , Sydney, McGraw Hill. Chitale, K, Mohanty, R and Dubey, P,2012, Organizational Behaviour: Text and Cases, Learning Pvt. Ltd. Davidson , P , Simon, L, Woods, P and Griffiths , R, 2009, Management core concepts and applications , Sydney , Witey . Huczynski, A and Buchanan, D, 2006, Organizational Behavior, Sydney: Prentice Hall. Judge, T and Piccolo, R, 2004, Transformational and Transactional Leadership: A Meta-Analytic Test of Their Relative Validity, Journal of Applied Psychology, 89( 5),p 755–768. Waddell, T ans Jones , G and George , J, 2012, Contemporary Management , Sydenet , McGraw Hill. Read More