Theories and Models Evaluating Leadership of a 21st Century - Case Study Example

Leadership of a 21st Century Leader Name Institution Course Date Leadership of a 21st Century Leader Introduction Every organisation requires leadership (Spinelli, 2006). Effective leaders are very essential to the success of any business organisation. A leader aspires for productivity and change in employees towards a desired objectives and goals. According to Lussier and Achua (2004), leadership not only influence the employees, but also the leaders, to attain the set goals of any organisation. Leadership thus entwines leaders-employees, organisation goals, influence and change. Leading highly involves people. Any individual is leading someone somewhere. However, the most important question to ask is how and where the people lead. For any individual to be an effective leader, he or she must make a good employee. Various scholars define a leader as one who has the responsibility of planning, directing, guiding individuals towards a set goal. Leadership contain two important components: personal and organisational. For leadership to bring success, it should be committed to both components. According to Spinelli (2006), a successful leader is one who is suitable and accountable. In addition, leadership is also described as the influence relationship existing between the leaders and the employees who are determined to attain a shared purpose. The qualities of good leadership are the same. Good leadership is founded on respectable personality and unselfish commitment to the employees and the organisation. Also, according to Kouze and Posner (2007), leadership originates from modelling the way, changing the activities, encouraging hearts, and inspiring shared goals and vision. Leadership has changed over the years, but is expected to change for the purpose of addressing revolving and modern day challenges. The main purpose of this report is to examine Jeff Bezos, the founder and CEO of Amazon.com and possibly evaluate his leadership by referring to the concepts and theories of leadership such as traits, power, behaviour etc. The paper will also highlight an in-depth review of how Jeff Bezos leadership style has influenced Amazon.com and how I would lead different if I was placed in the same position as the mentioned leader. Theories of Leadership The bitter truth of the matter is that there is no “magic combinations” of features and components that make leaders successful since different leadership concepts differ in different circumstances (Lussier and Achua, 2004). Nevertheless, this does not mean that one cannot learn to be an effective leader. What an individual requires is to understand and learn the various approaches to leadership in order to use the right approach for particular situation. One important way of doing so is to understand the major leadership theories that are considered the backbone of understanding leadership (Murphy, 2005). The core leadership theories include: Trait Theory Trait theory states that people can either be born or not born with the important qualities that influence them to be effective leaders (Daft, 2005). This theory originated from the ‘great Man’ theory in order to identify the key qualities that make up successful leaders. A believe that resulted from this theory is that critical leadership qualities could be identified and that individual with such qualities could be selected and incorporated into leadership positions. The main challenge with the trait theory is the fact that a good number of traits were identified but no consistent traits could be recognised. Even though various traits were identified in a good number of studies, results were considered inconclusive. A leader might have certain qualities but absence of them does not mean that he is not a leader (Lussier and Achua, 2004). According to the trait theory, effective leaders have interests, personality and ability traits different from a typical person. These traits do not necessarily identify a successful leader, but the preconditions that identify individuals with leadership potentials (Lussier and Achua, 2004). Some traits identified include achievement drive, emotional maturity, self-confidence, honesty and integrity, leadership motivation to name a few. Trait theory offer constrictive and essential information about leadership. It can therefore be utilized by managers to evaluate their position and how it can be made stronger (Daft, 2005). With regard to Jeff Bezos leadership, he is thought to have traits including intelligence, self-confidence and determination that have resulted to the growth of Amazon.com. According to trait theory, effective leadership entails a leader and leader’s personality. Thus, Bezos’s traits have led to his effective leadership style that has led to the success of his business. Style theory Style theory differs from trait theory. Style theory heavily considers what a leader do and not what he or she is. The core concept of the style theory relies on two forms of behaviour: task and relationship behaviour (Murphy, 2005). The way leaders combine these two behaviours influences leadership effectiveness. Style theory has involved three lines of research including Blake and Mouton Managerial Grid, Ohio State and Michigan University studies. They sort to identify the appropriate combination of leadership behaviours that would work in every situation. Although style theory is a stepping stone to understanding leadership, it has strengths and weaknesses (Lussier and Achua, 2004). It enhances the understanding of leadership and is supported by extensive body of research. In addition, style theory identifies task and relationship behaviours which are possible to learn and cultivate. Nevertheless, style theorists have not yet identified optimal style of leadership. According to the theory, a high task and great relationship style will bring the best result in terms of leadership. An effective leader initiates structure subordinates and task behaviours in order to realise full potential. Generally, style theory emphasises that actions of leaders occur on both task level and relationship level. How a leader identifies the best balance between the two behaviours is what establishes a good or bad leader (Murphy, 2005). Jeff Bezos is known to utilize transformational and transactional leadership styles that can be seen in his passion to achieve extraordinary results and manage ‘culture of metrics’ in providing the customers’ needs in regard to what the customers wants and not the employees. Behavioural theory Behavioural theory is based on specific behaviours of a leader. According to this theory, a leader’s behaviour is the best determinant of his or her leadership influences and this is able to predict leadership success (Lussier and Achua, 2004). This theory offers real marketing potential since behaviours can be conditioned according to a particular stimuli. In contrast with the trait theory that leaders are born, behavioural approach counters the argument as it proposes that an effective leadership is all about taking into consideration the actions and not the mental qualities as suggested by the trait theory (Murphy, 2005). According to the theory, leaders can be taught leadership and leaders can learn even if they are not born with the leadership traits through teaching and observation. An individual can be made a leader by training and teaching him or her appropriate and effective behavioural responses for any particular situation (Murphy, 2005). With regard to Jeff Bezos’s leadership, he is considered a leader with knowledge and competences that enable him achieve his goals. His leadership skills can be acquired through training and experience. For instance, Bezos was able to develop knowledge for the needs of the consumers and with his acquired understanding and knowledge he transformed Amazon.com to pay attention to these needs of the consumers. Power theory Power theory is based on the act that people are influenced through power and authority concept (Zimmerling, 2005). This is to mean that managers have the ability to influence the employees to get the job done. There are two distinct approaches here. To start with is influence of power through transactional leadership. Transactional leadership states that individuals are required to be given instructions and directions through rewards and punishments. Such style focuses on enhancing tasks and developing structures that are able to provide the reward should the tasks be met. When such targets are met by the employees, they are rewarded for it. On the hand, if they fail to meet the targets, they are punished as a result. Don’t get it wrong, some elements of transactional leadership style are effective and are widely used in many organisations. A good number of managers make use of some elements of this style to achieve the set goals and ensure employees are working towards the values set by the business organisations (Zimmerling, 2005). This style reveals itself in organisations in form of pay rises or bonuses for achieving objectives. However, the use of transactional leadership style make employees feel stifled and micro managed; their motivation and self-confidence often fall victim. For this, it should be used with other leadership styles in order to achieve maximum results. The second concept of power theory is the French and Raven’s five types of powers. They state how a leader can influence the employees. There are three positional powers namely legitimate, coercive and rewards and two personal powers namely charm and appeal. The theory suggests that use of personal power is effective as it builds relationships between team members and the leader in achieving goals (Zimmerling, 2005). Jeff Bezos is known to use his power to ensure that the employees follow his standards of excellence in achieving the set goals and objectives. The employees fear him and tend to work hard and do what is required in order to avoid crossing lines with him. Contingency theory According to this theory, leadership styles used should reflect on the environment a leader is in. The realization is that any leader is required to exercise different leadership styles that are appropriate for a given environment and that a leader should not be pinned to one leadership style. A great leader changes his style of leadership to set the needs of the organisation and the employees (Skogan, 2006). Contingency theory allows particular styles to be utilized in specific situations. According to the theory, a leader’s efficiency is contingent on the best way a certain style match particular situation. Effective leadership relies on the degree of fit and balance between a leader’s style and those of particular situation (Scoutler, 2011). Bezos leadership style is focussed on ensuring that the customers are satisfied with the products and services offered to them. It addresses customer’s needs and motivates customer-focussed behaviour among the employees. However, his leadership styles is said to belittle the employees and lead to negative working environment. As much as customer-focussed leadership approach is vital in the survival of any business, neglecting the employees can led to negative results as well. Jeff Bezos and Amazon.com Jeff Bezos is the founder and CEO of Amazon.com. Amazo.com is an American electronic commerce and the computing Business Company with the head-quarter stationed in Seattle, Washington (Stone, 2013). Amazon.com is the biggest internet-based retailer company in the United States (Stones, 2013). The company started as an online bookstore but it later diversified to selling video downloads, DVDs, software, electronics, food, jewellery to name a few. It also manufactures Amazon Kindle, fire tablets, fire Phones and is considered the biggest provider on cloud infrastructure in the world. Amazon.com success is attributed to its founder and CEO, Jeff Bezos since its establishment in 1994 (Stone, 2013). Jeff Bezos’s Leadership Style Bezos is termed as transactional leaders. According to Stone (2013), Bezos is a micromanager with demanding standards and does not care about people’s opinion. Transactional leaders are effective in achieving goals and enable an organisation to succeed in the thriving global competition (Taylor, 2009). In addition to having transactional leadership qualities, Jeff Bezos can also be considered a change agent always seeking to innovate. Transformational leaders attain extraordinary results and establish employee’s creativity. Transformational leaders also create an outstanding future vision which more often than not gains the heart of people (Webb, 2007). These leaders link the company’s goals to the values of the employees and arouse the interests to act on the vision beyond ordinary possibilities. Jeff Bezos, the Amazon head, grade high in this field. The results can be seen from the growth of Amazon.com that has resulted due to his ability to envision and innovate even when people around him did not believe he could bring success to the company. Bezos had leadership trait ever since he was young. According to some scholars, Jeff Bezos was born as a leader (Stone, 2013). His leadership style has led to negative and positive effects on amazon.com Work environment Amazon has been named as one of the companies with stressful work environment (Stone, 2013). It is ranked one of the most inflexible and non-conducive working environment among the high-tech company. Amazon.com employees have reported that Bezos berates them since he doesn’t let an opportunity pass before informing his challengers that he is the CEO. He is also considered highly opinionated. Thus, his transactional leadership style could be thought to result in workers at amazon.com not fully satisfied with available working conditions (Stone, 2013). Company growth Amazon.com shares are highly sorted after since the company show positive growth. This year, its shares were advanced from ‘neutral’ to ‘buy’ by Citi Bank. According to this, it is believed that the company will grow in the coming future and its progress is positive. However, most share upgrades focus on top line and not necessarily bottom line. In the last quarter of last year, Amazo.com reported a rise in prime members and customers. For this, the company therefore enjoyed a 25% sales increase (Xu, 2015). Over the years, the company has grown in relation to revenue, sales and prime members which one way or another is attributed by Bezos’s leadership styles. However, despite the increase in sales and revenues, the company has recorded losses for years now (Stone, 2013). For instance, Amazon.com suffered a loss of $123 million even with the 23% increase in revenue. This may perhaps be due to the leadership style of Bezos (Stones, 2013). Relationship between leadership style and health of Amazon.com According to Bensinger (2014), incorporation of transformational leadership style by Bezos has led to the growth and success of amazon.com since its establishment. The company started as an online bookstore but grew tremendously to becoming one of the largest online retailer that highly challenges online and offline retailers due to the focus and commitment of the founder; Jeff Bezos. It is also obvious that the hunger that Bezos has for change and innovation is a leadership quality that has led to the growth in sales and revenue for the company and increase in customer base (Xu, 2015). However, despite his recommendable efforts and commitment, Bezos transactional leadership style may have led to stressful and inflexible working environment where workers feel unappreciated and belittle and are put in a position where they question Bezos and his unrealistic plans of success and expansion. Amazon.com enormous losses are linked to the founder’s hunger to expand the already gigantic portfolio regardless of the growth in revenue and sales. It is reasonable to note that the losses are as a result of Bezos’s will to expand the company at a fast rate (Stone, 2013). How I would lead differently in Jeff Bezos’s situation According to contingency theory of leadership, any leader is required to exercise different leadership styles that are appropriate for a given environment or situation and that leader should not be pinned to one leadership style (Skogan, 2006). However, Bezos is focussed on the growth of the company and does not consider changing his leadership style in some circumstances where the employees require an intimate leader who would attend to their needs and enhance the relationship between him and the employees for a conducive and positive working environment to be established. If I were placed in the same position as Bezos, I would tone down my transformational qualities in order to give an opportunity for the company to register profits and expand at a reasonable pace. In addition, I would slow down my transactional leadership characteristics in order to create a friendlier and flexible environment for the employees. Bezos does not appreciate the hard-working and loyal team he has and is unnecessarily demeaning to them. Being hard on people do not necessarily mean they would perform better. As a leader I would invest my time in building a good relationship with the employees and create a positive environment that would motivate them to work hard at achieving the set goals. Conclusion Leadership is an essential concept that creates a healthy sustainable organisation. Any given organisation is impacted by the leader’s capabilities of taking the necessary actions to move the organisations towards the set goals and objectives. A manager is required to understand and learn the various approaches to leadership in order to use the right approach for particular situation. One important way of doing so is to understand the major leadership theories that are considered the backbone of understanding leadership. With regards to leadership, Jeff Bezos, a founder and CEO of Amazon.com use of transactional and transformational leadership style has led to the growth of the company in terms of sales, customer base and revenue. However, his leadership style also has led to negative impacts such as stressful and inflexible working environment for the employees and the company has also recorded losses over the years despite the growth in revenue. Perhaps Bezos should slow down on the use of transformational style and give a chance for amazon.com to record profits. In addition, Bezos should slow down his transactional characteristics in order to establish a more friendly and flexible working environment for the employees. 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