Business Leadership Terms + Defintions

Leadership

The process of inspiring others to work hard to accomplish important tasks.

Vision

A future that one hopes to create or achieve in order to improve upon the present state of affairs.

Visionary Leadership

A leader who brings a clear and compelling sense of the future as well as an understanding of the actions needed to get things done.

Power

Ability to get someone else to do something you want done or make things happen the way you want.

Reward Power

Capability to offer something of value.

Coercive Power

Capability to punish or withhold positive outcomes.

Legitimate Power

Organizational position or status confers the right to control those in subordinate positions.

Expert Power

Capacity to influence others because of one’s knowledge and skills.

Referent Power

Capacity to influence others because they admire you and want to identify positively with you.

Empowerment

The process through which managers enable and help others to gain power and achieve influence.

Autocratic style

Emphasizes task over people and keeps authority and information within the leader’s tight control.

Laissez-faire style

Shows little concern for tasks, lets the group make decisions, and acts with a 'do the best you can and don’t bother me' attitude.

Democratic style

Committed to tasks and people, sharing information, encouraging participation in decision making.

Authority Decision

Decisions forced upon the user to adopt or reject by someone in a position of higher authority.

Consultative Decision

Asking for input from a few select individuals but ultimately reserving the decision for yourself.

Group Decision

A collaborative process where people come together to make a decision, usually by consensus.

Charismatic Leader

A type of leadership defined by the positive personal qualities of the leader.

Transactional Leader

Someone who directs the efforts of others through tasks, rewards, and structures.

Transformational Leader

Someone who is truly inspirational and arouses others to seek extraordinary performance accomplishments.

Emotional Intelligence

The ability to manage ourselves and our relationships effectively.

Ethical Leadership

Encourages managers to lead by example with strong ethical values.

Integrity

Making decisions that are consistent with moral principles.

Organizing

The process of arranging people and other resources to work together to accomplish a goal.

Organizational Structure

The system of tasks, workflows, reporting relationships, and communication channels linking individuals and groups.

Organizational Chart

A diagram describing reporting relationships and the formal arrangement of work positions within an organization.

Formal Structure

The structure of an organization in its official state.

Informal Structure

A shadow organization of unofficial, often critical relationships between organization members.

Objectives

Specific results or desired outcomes that one intends to achieve.

Plan

A statement of action steps to accomplish objectives.

Policy

Broad guidelines for making decisions and taking action.

Procedures/Rules

Plans describing what actions are to be taken in specific situations.

Strategic Plans

Set broad, comprehensive, and longer-term action directions for the entire organizations.

Operational Plans

Define what needs to be done in specific areas to implement strategic plans.

Budgets

Single-use plans that commit resources to activities, projects, or programs.

Zero-based Budget

A budgeting process that allocates funding based on program efficiency rather than history.

Projects

One-time activities with clear beginning and end points.

Forecasting

Making assumptions about what will happen in the future.

Contingency Planning

Identifying alternative courses of action for changing circumstances.

Scenario Planning

A long-term version of contingency planning.

Participatory Planning

Planning processes including people affected by the plans.

Controlling

Measuring performance and taking action to ensure desired results.

After-action review

Focuses on why things happened and compares intended results with actual accomplishments.

Feedforward control

Employed before a work activity to ensure objectives are clear and resources are available.

Concurrent control

Focus on monitoring ongoing operations during the work process.

Management by Exception

Focusing attention on situations showing the greatest need for action.

Management by Objectives

A structured process of communication for setting and reviewing performance objectives.

Progressive Discipline

Ties reprimands to the severity and frequency of employee infractions.

Benchmarking

Use of external comparisons to evaluate performance and identify actions for the future.

Ethics

Moral principles that determine good/right behavior as opposed to bad/wrong behavior.

Utilitarian view

The greatest good for the greatest number of people.

Cultural Relativism

Ethical judgment determined by the cultural context.

Ethical Behaviour

What is accepted as good and right under the governing moral code.

Individualism view

Commitment primarily to one’s long-term self-interests.

Ethical Imperialism/Cultural Universalism

Behavior unacceptable at home should not be acceptable elsewhere.

Ethical Dilemma

A choice presenting potential benefits but viewed as unethical.

Moral-Rights View

Respects and protects the fundamental rights of all people.

Universalism

Possible to apply generalized norms to all people regardless of context.

Justice View

Fair and impartial treatment of people according to legal rules.

Code of Ethics

A guiding set of principles for professionals to act in alignment with organizational values.

Values

The regard something is held to deserve, importance, worth.

Whistle-Blower

Exposes misdeeds to preserve ethical standards and protect against harmful acts.

Terminal Values

Present value of all your business's cash flows at a future point.

Corporate Social Responsibility (CSR)

A business's responsibility extends beyond profit to the impact on stakeholders.

Instrumental Values

The means by which we achieve our end goals.

Bureaucracy

A system of government where decisions are made by state officials rather than elected representatives.

Self-fulfilling Prophecy

Expectations for behavior can bring about the expected behavior.

Hawthorne Effect

People change behavior when aware of being observed.

Learning Organization

Organizations ready to adapt and learn are more likely to succeed.

Organizational Behaviour

Deals with employee attitudes and feelings like job satisfaction and emotional labor.

Open System

A platform that can be modified and has freely available documentation.

Subsystems

Self-contained systems within a larger system.

Systems

Sets of things working together as parts of a mechanism or interconnecting network.

Theory X

Managers view workers as inherently lazy.

Theory Y

Managers believe employees are self-motivated and creative.

Theory Z

An approach prioritizing long-term employment and teamwork.

Accountability

The requirement of one person to answer to a higher authority for performance results.

Intellectual Capital

The collective brainpower of a workforce.

Project Managers

Someone who coordinates a project with tasks and deadlines.

Administrator

Works in public and nonprofit organizations.

Knowledge Worker

Someone whose mind is a critical asset to employers.

Staff Managers

Use technical expertise to advise and support line workers.

Conceptual Skill

The ability to think critically and analytically.

Management

The process of planning, organizing, leading, and controlling resources to accomplish goals.

Supervisors/Team Leaders

In charge of a small work group of non-managerial workers.

Functional Managers

Responsible for a single area of activity, such as marketing or accounting.

Manager

A person responsible for the work of others.

General Managers

Responsible for complex units including multiple functional areas.

Middle Managers

In charge of relatively large departments or divisions.

Managerial Competency

A skill-based capability that contributes to high performance in management.

Human Skill

The ability to work well cooperatively with others.

Technical Skill

The ability to apply specialized expertise to perform tasks.

Top Managers

Responsible for the performance of the organization as a whole.

Halo Effect

Occurs when one attribute is used to develop an overall impression of a person or situation.

Departmentalization

The process of grouping people and jobs together into work units

Functional Chimneys Problem

A lack of communication, coordination across functions.

Matrix Structures

combines functional and divisional approaches to emphasize project or program teams.

Network Structures

uses IT to link with networks of outside suppliers and service contractors.

Upside-Down Pyramid

put customers at the top, served by workers whose managers support them

Team Structures

uses permanent and temporary cross-functional teams to improve lateral relations.

Cross-Functional Teams

brings together members from different functional departments.