Leadership Role and Organization Performance - Essay Example

Leadership Role and Organization Performance The general belief, or assumption, in the study of leadership is that an effective leader is the key determinant of organizational performance. The leaders affect the performance of the organization through their leadership styles, personal influence, and actions (Northouse, 2010). A random check on any successive organization immediately creates a picture of the organization’s leaders. An example is Apple with the late Steve Job, Microsoft with Bill Gates, Google, Cisco and others. Such observations seem to be the base of the assumptions. Nevertheless, these assumptions lack verification due to limitations in research concerning the issue. Ultimately, this assumption has propagated to the highest levels of organizations. As such, major organizational problems trigger replacement of the organization’s leaders, with the theory that such a move will act as an antidote for reversing the poor performance of the replaced leaders. Leadership is like an art, and as such, requires techniques, self-expression, and discipline. In common circumstances, new leaders borrow techniques used by previous successful leaders. The success rates often differ from one leader to another. The leader must learn the techniques first, then maybe combine them with self-characteristics that will develop a brilliant self-expression. The techniques of the leaders must change with changing times and environment. Consequently, the measurement of success should not emphasize on the actions of a leader, but rather on the effects of what the leader does. Leaders have to develop actins that carefully to fit the individual and organizations personalities in order to bring effective results when used. This does not disregard the importance of patterns in a leader’s action. In fact, a leader with quality leadership knowledge will most often use patterns in his actions and decisions. Techniques and consistent patterns are very valuable to a leader (Northouse, 2010). Allan Mulally, the Chief Executive Officer at Ford Motor Company, has credit for reviving the automobile company from the 2000 recession and leading it to become the only car manufacturer to survive the government-sponsored bankruptcy. Under the leadership of Mulally, Ford insisted that it had enough money to overcome the recession and dud not require any government loans. In contrast with its rival GM and Chrysler, Ford did not request any loans from the government. After the loans for GM and Chrysler were processed, a government task force deposed GM Chief Executive Officer Rick Wagoner, and Chrysler bankrupt. Ford, through Mulally’s decision, survived this bankruptcy. Nonetheless, Ford continues to record losses just like the other major automobile manufacturers, but there are signs of its recovery. Mulally’s leadership style is described as results-oriented. He is authoritative and crisp in his management (Schermerhorn, 2011). On Ford’s market expansion, the company has experienced a growth in its market share of retail sales up six times what it was in the past. Further to this, the automaker has negotiated four new agreements with the firm managing its workers’ welfare, United Auto Worker, for reduction of the hourly labor cost from 76 dollars to 55 dollars. Ford has also released 2.4 billion dollars as part payment for its 10.1 billion dollars of a long-term debt. The trading share price has risen to nearly five-folds since its low mark trading in November 2010. When Mulally was hired as the CEO in September 2006, he did not posses any engineering or designing in cars experience. He had worked at Boeing 777 but not in the engineering department. He developed a strategic master plan that highlights the specific goals of Ford, with a consistent operational process that moves the company towards the achievement of its objectives, and a system that ensures the company gets there. Mulally takes a keen interest in all the operation of the company, setting Thursday mornings as his weekly brief sessions. Nevertheless, the CEO also demands daily reports and progress depending on the processes taking place. His plans have guided the company on essential moves in the recent past. An instance is the recession of 2006, where Mulally borrowed money against the company’s assets, thus pilling more debts on the company. However, this move helped the company survive the bankruptcy that was a result of government loans. Despite past failures, Mulally is focusing on the global integration of the company. His plans may be part of the recent Ford venture of selling small cars made from Europe in the US since 2010. With the specific goal of focusing on Ford brands, Mulally convinced Bill Ford to sell Land Rover and Jaguar brands and deploy the resources to the Ford brand. His timeliness in goal achievement enabled the company to sell the brands to Tata while there was still market for luxury automobiles. He has also put Volvo up for sell. His main goal remains to turn Ford into a profit-making automaker and compete with the likes of Toyota by the fall of 2011. Mulally tactics include letting everyone in the company know the status, plan, and areas that require attentions. The openness strategy seems to gain him popularity among the employees. For example, he focuses on reducing the company’s dependency on revenues for light trucks, and he has let all the employees know this aim straightforwardly. Mulally trusts his employee with their responsibility. He believes that the employees can work well in an open communication in the organization. The organization’s agendas and goals are open to all levels of company’s structure. On his arrival at the company in 2006, Mulally carried out a lot of interviews and research noting the observations. The observations helped him develop a foundation that now guides his decision-making in the company. Mulally leadership style borrows heavily from his experience at Boeing (Schermerhorn, 2011). The pillars of his plan include focusing on the Ford brand, competing in the entire market segments with carefully defined brands, concentrating on few nameplates, and becoming the world’s best in quality, value, safety, and fuel efficiency. His action-plans have so far helped the automaker stay safe from bankruptcy. The first model under his management is the redesigned Ford Taurus, produced in 2010. The other vehicles due for the US market are the Fiesta and Focus. Mulally has steered Ford back to stability from the effects of the 2000 recession. In conclusion, Mulally’s success can be to attributed to five factors, which may apply to any other leader in an organization; Preparation, a clear and concise plan, a clear point of view, alignment of the organization’s culture with the plan, focus and follow-through of the plans. From a business perspective, his master plan is working perfectly, and if he continues in the same direction, Ford may be competing with Toyota in a few years to come. Reference Northouse, P. G. (2010). Leadership: Theory and Practice. California: Sage Publications, Inc. Print. Schermerhorn, J. R. (2011). Exploring Management. New Jersey: John Wiley & Sons, Inc. Print. Read More