Management

Trait theories

• implies leaders are born

• personality, social, physical, intellectual, or other personal characteristics

Trait theories pros and cons

pros:

• clear framework

• useful for selection and guidance

cons:

• ignores situational context

• fails to explain development

• risk of subjectivity and stereotyping

Behavioural theories

• implies leaders can be made

• sees leadership as a set of style or behaviours that help other perform a task and reach a goal

Behavioural theories pros and cons

pros:

• fosters innovation

• improves morale

cons:

• human behaviour is complex

• context-dependent

• may focus too much on social satisfaction

Task-oriented behaviours

• providing structure, direction, and aiding performance

People-oriented

• demonstrating concern, respect, and care for the wellbeing of others

The full range leadership model

Transformational Leadership

1. Idealised Influence or Charisma

2. Inspirational Motivation

3. Intellectual Stimulation

4. Individualised Consideration

• leadership for exploration and change

Idealised influence or charisma

Leads followers to a higher purpose

• acts as a role model

• promotes high standards of moral or ethical conduct

Inspirational Motivation

Leads followers to believe in a better future

• communicates high expectations to followers

• uses symbols and emotional appeals to communicate a shared vision

Intellectual stimulation

Leads followers to find new solutions

• stimulates followers to be more creative and challenge their beliefs

Individualised consideration

Leads followers to self-actualisation

• provides a supportive climate

Contingency/Situational theories

Predicting leadership success is more complex than isolating a few traits or preferable behaviours.

• appropriate style of leadership is contingent on the requirements of the situation

Contingency/situational theories pros and cons

pros:

• high adaptability

• improves organisational fit

• encourages social awareness

cons:

• demanding on leaders (complex)

• reactive over proactive (causes leaders to focus on the present more than long-term strats)

Situational model

Transactional leadership

leadership for exploitation

Traditional leaders

• sees leadership as a rank to obtain

• uses power and control to drive performance

• measures success through output

Servant leaders

• sees leadership as an opportunity to serve others

• shares power and control to drive engagement

• measures success through growth and development

Interactive leadership

leaders favour a consensual and collaborative process

Ineffective leadership

fails to produce the desired outcome

Unethical leadership

fails to distinguish between right and wrong

Charisma pros and cons

pros:

• followers experience strong feelings towards the mission and the leader

• they full-heartedly trust the correctness of the leader’s belief, and obey willingly

cons:

• may use power for personal gain

• insensitive to followers needs (maybe)

• censure critical or opposing views

Factors influencing obedience

• status of location

• legitimacy of authority figure

• peer support

• personal responsibility

• status of authority figure

• proximity of authority figure

Expert power

stems from special knowledge or skills in tasks performed by employees

Referent power

stems from the characteristics that command employees identification, respect, and admiration

Personal effort

shows initiative beyond what is expected of them, gains power as a result

Network of relationships

more interpersonal connections = knowledge on organisation and industry

Information

people who have access to info can control how and to who it is distributed to

Communication

the process by which info is exchanged and understood by two or more people, usually with the intent to motivate or influence behaviour

Effective communication

1. Share info

2. Achieve coordinated action

3. Express feelings or emotions

Model of the Communication Process

1. Encode - choose symbols to compose message

2. Choose a medium/channel

3. Decode - translate the symbols and interpret

4. Feedback (it’s a two-way process)

Communication fidelity

Correspondence between the intention and understanding

Why communication infidelity occurs

• source may withhold or filter info

• encoding/decoding issues may occur

• receiver may be overloaded, not listening, focusing selectively

• feedback may be insufficient to verify fidelity

Barriers to effective communication

1. filtering

2. selective perception

3. information overload

4. emotions

5. context

6. languages

7. gender differences

8. generational differences

9. cultural differences

Filtering

senders purposefully withholds or distorts info

Selective perception

receiver selectively interprets transmitted info on basis of interests, background, experience, and attitudes

info overload

info inflow exceeds individual’s processing capacity

emotions

how a receiver feels at the time a message is received

Context

• enviro (noise/visibility)

• type of place

Languages

• words and non-verbal symbols may have different meanins to different people (shaped by culture)

Gender differences

• men talk to emphasise status

• women talk to create connections

Cultural difference

High-context culture - communication is seen as a means to engage with someone

• relo focused

• nonverbal, implict, indirect

Low-context culture - communication is seen as a way to exchange info

• task-focused

• verbal, explicit, direct

Sender’s responsibilities: Persuasive communication

• establish credibility

• emphasise common ground and mutual beliefs

• connect emotionally

• use multiple media to add weight to the message

• communicate with candour

Sender’s responsibilities: Relational meta-communication

• choose correct body language and tone to establish a particular relational context

• manage content and relational aspects of communications

Sender’s responsibilities: choosing the right medium

high channel richness vs low channel richness

Media richness theory

suggests that rich media are better suited for non-routine messages

• rich media also communicate care and may be especially useful in challenging times or for sensitive communications

High channel richness pros n cons

pros:

• personal

• two-way

• fast feedback

cons:

• no permanent record

• spontaneous

• difficult to disseminate

Low channel richness pros and cons

pros:

• permanent record

• premeditated

• easy to disseminate

cons:

• impersonal

• one-way

• slow feedback

Direction of communication flow

1. Upward

2. Downward

3. Horizontal

Downward communication

refers to messages and information sent from top management down to employees

• traditionally emphasised (authoritarian structure)

Involves:

1. goals and strats

2. job instructions and rationale

3. procedures and practices

4. performance feedback

5. indoctrination

Cons of Downward Communications

1. Distortion

2. Information overload/ambiguity

3. Filtering

Distortion

the loss of content/meaning as the message travels downward through multiple people

Information overload/ambiguity

sending too many (possibly contradictory) or too vague messages

Filtering

management withholding valuable info from employees and potentially communication low regard for them

Upward communication

includes messages that from from the lower to the higher levels of the organisation’s hierarchy

• increasingly encouraged (participative management—empowerment)

5 types of info communicated upward:

1. problems and exceptions

2. suggestions for improvement

3. performance reports

4. grievances and disputes

5. financial and accounting info

Cons for upward communication

• managers may resist hearing about employee problems or react defensively

• employees may not trust managers sufficiently to push info upward (fear of being ignored, embarrassed or punished for speaking up)

Horizontal communication

refers to the lateral or diagonal exchange of messages among peers or coworkers

• increasingly encourages (decentralisation and cross-functional teamwork for more flexible and faster responses in complex enviro)

3 main categories:

1. Intradepartmental problem solving

2. Interdepartmental coordination

3. Change initiatives and improvements

4. 
   

Cons with horizontal communication

• not enough time or opportunities

• cultural barriers - people from different functions are unwilling or incapable of effectively communicating with one another (territoriality and rivalry; specialised knowledge, vocab, and convo style)

Formal communication channels

• systems designed by management to dictate who should talk to whom to get a job done

• used for organisational purposes exclusively

Informal communication channels

• patterns of interaction emerging from shared personal interest, proximity, shared dislike

• used for both non-work and work-related purposes

• can enable faster and more effective communication than formal channels

Informal channels pros and cons

pros:

• quick (uncontrolled) info flow

• jump-start stalled initiatives

• mobilise actions to achieve difficult deadlines

• can stimulate entrepreneurial energies

cons:

• blocks, diverts, distorts communications

• mobilise actions to oppose change

• breeding ground for politics

Entrepreneurship

the process of initiating a business venture, organising the necessary resources, and assuming the associated risks and rewards

The context of entrepreneurship

1. economic changes

2. globalisation and increased competition

3. tech

4. new opportunities and market niches

5. organisational innovation

6. social entrepreneurship

Economic changes

• fertile

• economy changes constantly, providing opportunities for new businesses

Globalisation and increased compeition

• demands entrepreneurial behaviour, organisations have to find ways to do things faster, better, and less expensively

• globalisation and increased competition also give an advantage to small businesses (can offer flexibility and fast responses) rather than huge organisations which rely on economies of scale

Tech

• rapid advances and falling prices in tech have spawned new industries asw as new methods of producing and delivering goods and services

New opportunities and market niches

entrepreneurs are taking advantage of the opporunity to meet changing needs in the market place

Organisational innovation

• the processes of developing new products or services, technologies, systems, business models, and ideas

• innovation involves taking an idea for something new or different through full-scale commercialisation

• act of invention is the first step in innovation

Social entrepreneurship

focuses on creating social value by providing solutions to social problems with a secondary purpose of generating profits and returns

Incremental innovation

more like continuous improvement

Radical innovation

a product/service/system/tech that is brand new to the industry, country, or world

Business plan

a document specifying the business details prepared by an entrepreneur prior to opening a business

• forces entrepreneur to think abt the issues and problems associated with starting and developing a business

• most entrepreneurs have to borrow money (business plan helps persuade lenders and investors to participate)

Successful business plan criteria

• clear, compelling vision w air of excitement

• clear and realistic financial projections

• detailed info abt potential customers and target market

• detailed info abt industry and competitors

• evidence of effective entrepreneurial management team

• good formatting n clear writing

• plan is short (50 pages max)

• critical risks that may threaten business success

• sources and uses of start-up funds and operating funds

• capture reader’s attention w great summary

Choosing a legal structure - Sole proprietorship

• an unincorporated business owned by an individual, carried on for profit

• they own more than half the business

• this form is popular because it is easy to start and has few legal requirements

• they have total ownership and control of the business and can make all decisions without consulting someone

Choosing a legal structure - Partnership

• an unincorporated business owned by two or more people

• relatively easy to start

• cons of a partnership: the unlimited liability of the partners and disagreements that almost always occur w strong-minded people

Choosing a legal structure - Company

• created as a legal entity by the state and exists apart from its owners

• has a legal life of its own

• continues to exist regardless of whether the owners (shareholders) live or die

• the structure is sued when the structure is legally liable

• pros: continuity and limits on owner’s liability

Choosing a legal structure - The franchise appeal

• a firm collects upfront and ongoing fees in exchange for allowing individuals or other firms to offer products and services under its brand name and to use its processes

Choosing a legal structure - Participate in a business incubator

typically provides shared office space, management support services and management and legal advice to its entrepreneurs

5 stages of growth for an entrepreneurial company

1. existence

2. survival

3. success

4. takeoff

5. resource maturity

Intrapreneur

• innovate within a business

• less risky

• access to resources

• job security

Arranging financing

Debt financing - can involve borrowing money from friends, family, personal credit cards, or a bank load

• typical source of funds for businesses with high potential is through angel financing

• angels are wealth individuals typically with business experience and contacts who believe in the idea for the start-up and are willing to invest their personal funds to help the business get started

CSR - Corporate social responsibility

the obligation of an organisational management to make decisions and take actions that will enhance the welfare and interests of society as well as the organisation

Carroll’s CSR Pyramid

1. Discretionary responsibility - contribute to community and quality of life

2. Ethical responsibility - be ethical

3. Legal Responsibility - obey the law and maximise profits within the legal framework

4. Economic responsibility - profit maximisation, produce the goods and services a society wants and profits for owners and shareholders

Pros fo CSR

1. Image - can create a favourable public image

2. Risk Management - can prevent criticism and discourage further government involvement or regulation

3. Resource endowment - have financial and human resources to support public and charitable projects that need assistance

4. Long-run profitability - studies argue that socially responsible companies tend to have more secure long-run profits

Cons for CSR

1. Profit maximisation goal - pursuing social goals dilutes businesses’ primary purpose—profit maximisation

2. Costs - many socially responsible actions don’t cover costs

3. Jurisdictional domain - not the responsibility of a business to address social and environmental problems (government’s job) bc businesses alr pay taxes

4. Lack of skills - business leaders lack the skills needed to address social issues

Stakeholder engagement

• CSR requires consideration and balancing of stakeholders’ needs and interests

• organisations can use stakeholder mapping to identify stakeholders’ needs and expectations

• an open view of stakeholder engagement is often an indicator of a genuine and strong commitment to CSR

The triple bottom line

Managerial ethics

the code of moral principles and values that govern managerial behaviour and decision-making with respect to what is right or wrong

• economic pressures can muddy ethical waters

• simply acting within the law doesn’t constitute ethical behaviour

Managers’ levels of moral development

1. Preconventional

2. Conventional

3. Postconventional

Preconventional

• follows rules to avoid punishment

• acts in own interest

• obedience for its own sake

Conventional

• lives up to the expectations of others

• fulfils duties and obligations of the social system

• upholds laws

Postconventional

• follows self-chosen principles of justice and right

• aware that people hold different values and seeks creative solutions to ethical dilemmas

• balances concern for common good

Structural and culture influences

don’t blame the individuals involved without considering how the situation contributed to the behaviour

• risks associated with management by objective

• barriers to upward communication flow

• the subtle messages that the corporate culture sends to employees

Building an ethical organisation

1. structure

2. culture

3. politics

Structure

• chief ethics officer

• ethics committee

• code of ethics and ethics training

• hotlines and support for whistleblowers

Culture

• reemphasise values of openness, critical self-assessment

• humble, moral leaders

• beware of incongruences between values and reward structures

Politics

• power to diverse individuals

• build diverse networks to avoid groupthink

ESG Excellence Framework

environment, society, governance

Organisational structure

refers to the framework in which the organisation defines how tasks are divided, the work of employees and departments coordinated, and authority distributed

• affects organisation’s ability to reach their goals

Steps for formal organisation design

Degrees of formalisation:

• division of labour (differentiation)

• coordination of mechanisms (integration)

• distribution of decision rights (decentralisation)