Category: Business Management Essays

Our sample business management essays will prove helpful in formulating your own dissertation topic, objectives, literature review, methodology and analyses. Our sample Business essays are an ideal tool for any student struggling to start their own Business essay.

Business Management is an essential part of any organisation and there are many elements of Business Management. By browsing our collection of Business essays, you will get ideas for your Business essay through the following Business subjects:

Global Business, Business Strategy, Corporate Social Responsibility, Change Management, Project Management, Organisational Behaviour, Leadership, Globalisation, Strategic Management, Entrepreneurship, Technology and Innovation Management.

Business Management Essays

Brexit and The European Union Dissertation

Brexit and The European Union

The year 2016 is going to be remembered for long years to go for the historical term “Brexit” that meant Britain exiting from European Union. This possibility aroused since 2007, under the article 50 of treaty of European Union under European states. The final exit decision took place in June 2016 under the referendum where the votes in favor of leaving EU were 51.9%. Though there were many reasons that lead to Brexit, but some of the economic aspects are worth mentioning.

The people of Britain wanted self government system back that had existed hundreds of years ago. There were certain reasons that British citizens wanted to exit from European Union and thus held general elections to get rid of the government. The main issue behind this exit decision was that being under European Union made Britain feel like being ruled by a foreign power where they have no rights of taking their own decisions (Dagnis Jensen and Snaith, 2016). One of the key economic impacts is that Britain had been facing trade barriers under the European Union that could be well managed by this exit decision. The market prices for EU are much higher than the world market prices and that has been affecting the economy of Britain in terms that the country involved in producing more of the products that were worst and less of those it was best in producing. Furthermore this also led the customers to pay higher amounts due to tariff and trade policies of EU and thus the exit from it was the much significant decision (Weiler, 2015).

Figure 1: Income inequality in UK

Figure 1 above describes one of the key economic reasons why Britain chose to leave the European Union is inequality in Income. It describes that though the overall European economy was doing well and had larger benefits and shares, still these benefits are not being felt by population in an even and justified manner.

After this exit, the barriers both tariff and non- tariff on trade could be removed from UK that were being imposed upon by EU till now. This will in turn benefit the customers and raise their living standards due to larger decrease in import prices. In contrast to this there are certain arguments against this decision of exit of Britain from EU (Boulanger and Philippidis, 2015). The key UK producers could determine that the prices that they would get in the free market would be different they used to get inside EU, in fact it would be lesser.

The products they sell outside are no different they sell inside EU but the protection of customs union premium provided by EU would be lost that would affect these producers. It can be concluded from the above statements that the customers would be the people in benefit from this exit decision and also those firms that are willing to buy the products at the world prices, whereas the producers within the union would be disheartened as they would have to lose their share of premium under the European Union. There are further arguments describing that after Brexit, UK may opt to trade under World Trade Organization (WTO) policies (Dhingra, Ottaviano, Sampson and Reenen, 2016). In such case it would not be able to get benefits of tariff free trade as it had, being under the membership of EU. Further this would also support the companies in halting the inflow of less skilled workers from EU. It would also provide relaxation in migration policies and provide ease to the highly skilled immigrants from EU and non- EU countries to work.

Another economic perspective towards this decision of Britain is the gain that the customers and firms would have while balancing the resources and allotting them to industries which are efficient and removing from that are less or inefficient (Oliver, 2016). The key economists of the country also estimate the gain in trade of Britain after this exit to 4% rise in GDP. Despite of this there are arguments with risks of loss in job and foreign direct investment. It has been argued that the foreign investments would be reduced but it has neglected the fact that FDI is just due to better returns in foreign capital and thus the countries can invest, just the sectors would change where there are free trade policies. Further with the investments in new sectors, the jobs will also arise in those, thereby fulfilling the loss of jobs created in the European Union protected sectors.

After the result of referendum on Britain exiting EU, many economic, political and financial impacts are most likely to be seen. It would be not new and surprising to know that after the decision, London is to face a number of financial issues that would further have an impact on overall economy of the country (MacShane, 2015). The very first impact that could be seen in London would be loss of jobs. In making the decision of exit from the European Union, the future of the city of London has been one of the key concerns.

The government of London will have to involve in effective strategy formulation to manage the possible financial and economic effects of this referendum. There are possibilities of clash in market with the change in currency values that will have an overall impact over London and its market. However, it is being argued that the city will remain as the key financial centre of the world and will be successful in managing the “Brexit” situation as it has already undergone such crisis situations during the world wars too (Barrett and et.al, 2015). While London was within the European Union, it had been enjoying the title of world’s important financial centers which is now likely to get affected by various policies and regulatory aspects.

There are number of companies that have already announced that with this decision of exiting from the European Union, they would be moving their employees out of London. J.P. Morgan also in this context said that it would be relocating around 4000 of its employees out of Europe. There are many banks outside the nation, like from US that have been trading in London as to escape from the restrictions that exist outside the European markets (Swinbank, 2016).

Similarly with the news of Brexit, Deutsche Bank also said that it is going to relocate its employees. The effects of Brexit decision are to be studied for London, as it is not only the financial centre of Europe but has topped the list of world’s best city to do business due to fewer barriers. Therefore this decision will definitely be affecting its title and the overall business economy. There are many businesses dominating in London like banking, mortgage brokers, real estate firms and the overall financial industry that is much likely to be affected with this referendum. Furthermore, there are cities in EU like Paris, Frankfurt, Amsterdam and Dublin that would be most benefited with this change and have prospective of becoming the new London for the world markets (Springford and Whyte, 2014). The overall situation can also be understood with the concept of Passporting with context to EU that describes that all the European Union based financial institutions can sell their services without getting the approval of regulator.

Further after the Brexit, every such firm would need to get regulatory approvals on local basis that is a key factor driving their decision to move their business out of London. Passporting is one of the key features that have led to the success of the banking industry with EU nations due to ease of cross border transactions and investments. After this decision, London would need to develop a new regulator that would not only require cost but would also involve authentication to develop trust among the various business firms to rely upon (Danielsson, James, Valenzuela and Zer, 2014). Further authorization of new regulators would also take considerable time to establish itself that will bring a change in the overall financial and economic status for London for its exiting decision from the European Union.

There are various risks associated with all the firms working in UK that would be affected with the decision of Britain exiting the European Union. The city like London have been the financial hub of UK that would be the most affected area after the referendum result in Britain exiting the European Union. Most of the firms that are likely to be affected by this decision would be the financial institutions, banks, real estate firms, etc. Before this referendum’s result, there are many companies that have already announced their changing business plans and strategies for their firms in Britain, if the country was to leave EU (Virasami, 2016). Most of the banks and companies are already in need to leave UK, and shift their operations to other country under the European Union states. This is due to the ease of business and lesser trade barriers and tariffs under the European Union policies that might have a larger economic and financial impact on every business.

Companies like Vodafone have warned UK that it would be shifting its headquarters from London to some other country if it exited the European Union. On the same track, one of the biggest lenders of Britain, Lloyd’s Banking group had made plans to sell out the shares of the taxpayers that are prone to be affected once the decision is being made. Furthermore companies like Virgin group have plans to cut down around 3000 jobs with the Brexit. Apart from this there are companies that have put their future export and investment plans on hold after the final decision being announced. Also the lending firms have cut short their property purchasing in London (Helm, 2016).

The risks associated with the decision of Britain exiting EU are not countable or measurable but could be understood in terms of financial and economic losses. Large numbers of firms are to face the loss in market share and affect the availability of jobs as well as personnel. The risks for the companies also involve lowered profits for the firms and control over the personnel. This decision is also likely to affect the political and social scenario of the country. Immigration is a problem that is being faced by the nation and more than half of the population is immigrant of some other place. However, with this decision, the immigrants would move again in search of better opportunities and jobs. Also as studied above, after exiting EU, the regulatory approvals would become more difficult and troublesome for the firms to continue in the same way as it existed before. Though this decision is favorable for customers and buyers but producers and investors are the ones that are most likely to be affected (Williams, 2016).

The final decision of Britain exiting the European Union would completely reform the financial services industry of the country. It has been evident that the city of London had been the largest centre of financial investments in the complete European Union and has been attracting large number of banks and financial service providers. It will thus be required for UK to formulate effective polices and plans to retain all its existing business firms and develop regulatory authorities to manage the approvals after exiting from EU (Palmer, 2016).

With the step towards taking the decision of exit from EU, there are many threats and risks associated with Brexit. There are many uncertainties and challenges that British firms have to possibly face after this decision. After this, UK will have to lose its membership of European Economic Area, European Free Trade association etc. The committee handling risks have been analyzing potential risks and have coordinating to make sure they have better plans to deal with short term and long term risks. There are companies like British gas Insurance that may not have direct potential impact through Brexit but if their parent company Centrica is impacted then they might also face risks for which they need proper mitigation approaches.

Communication

There are companies that are getting involved in improving communication among the different managerial levels. They have plans to ensure each and every message and update over the Brexit issue and let all the people all over the organization know about it on consistent basis (MacShane, 2015).

Stakeholders

The risk managers have also plans to keep their stakeholders assured and manage them cautiously. They too are to be updated timely about their losses or gains with shareholdings in the firms. Also the stakeholders must have clarity of situation and the company must not make fake promises to them.

Change Management

This is one of the most important aspects to be considered in risk management approach. The firms and its employees must be completely ready to accept the possible changes that are to occur if UK leaves EU. There would be lot of changes in legal, economic and political scenario that would have an overall impact on the complete economy. These impacts could be seen not only for few days or months but for years (Springford and Whyte, 2014). Thus the managers must be aware about the next steps they are to take up for managing the changed scenario of UK after leaving the membership of EU.

There are possibilities that if Britain exits EU, there will be migration, attrition, policy changes and loss of shareholders that will change the complete business scenario for the country. Also the legal and authorizing business approvals would have to be established in a completely new form that would need the firms that intent to continue with UK, to manage the upcoming challenges.

There are many firms that have announced that they would be shifting their operations partially or fully to some other country that is an EU member state (Oliver, 2016). This is an approach that many firms have adopted in order to ensure that they do not face extreme losses or trade barriers.

It has been evident that EU states have benefits of free trade with least barriers but this would not be the situation if UK exits this membership. It has been a fact that the jobs in Britain are being safeguarded by EU as it has been a market centre for more than 500 million customers and it is Britain whose membership with EU has been the most attracting factor for FDI.

However this decision of Britain had led the firms to hire new people called effective troubleshooters that would help them in dealing with such situation after Brexit. The demand of lawyers, consultants, financial advisors and experts in the country has increased with this news flowing around for the sake of safeguarding the business from the post effects of this decision (Weiler, 2015). The organizations have started working on the reframing of trade agreements, funding problems and their solutions, staffing concerns, trade barriers and plans to deal with them. Though EU had provided free trade but the extreme interference of its policies in trade and profit sharing for the firms had made Britain to take such decision. Thus there are many firms that are still in support of this decision of Brexit, despite of the fact that this can be a potential threat to their business and funding requirements.

References

Barrett, A. and et.al, 2015. Scoping the possible economic implications of Brexit on Ireland. ESRI Research Series, 48.

Boulanger, P. and Philippidis, G., 2015. The End of a Romance? A Note on the Quantitative Impacts of a ‘Brexit’ from the European Union. Journal of Agricultural Economics, 66(3), pp.832-842.

Dagnis Jensen, M. and Snaith, H., 2016. When politics prevails: the political economy of a Brexit. Journal of European Public Policy, pp.1-9.

Danielsson, J., James, K., Valenzuela, M. and Zer, I., 2014. Model risk and the implications for risk management, macroprudential policy, and financial regulations. VoxEU. org, 8.

Dhingra, S., Ottaviano, G.I., Sampson, T. and Reenen, J.V., 2016. The consequences of Brexit for UK trade and living standards.

Helm, T., 2016. Brexit donor’s company spells out risks of quitting EU.

MacShane, D., 2015. Brexit: How Britain Will Leave Europe. IB Tauris.

Oliver, T., 2016. European and international views of Brexit. Journal of European Public Policy, pp.1-8.

Palmer, K., 2016. How businesses have reacted to Brexit so far.

Springford, J. and Whyte, P., 2014. The consequences of Brexit for the City of London. Centre for European Reform.

Swinbank, A., 2016. Brexit or Bremain? Future Options for UK Agricultural Policy and the CAP. EuroChoices, 15(2), pp.5-10.

Virasami, J.H., 2016. Brexit referendum: in-out, in-out, shake it all about.ROAR, 9, p.2016.

Weiler, J.H., 2015. Brexit: No Happy Endings; The EJIL Annual Foreword; EJIL on your iPad!!!; Vital Statistics; ICON. S Conference. European journal of international law= Journal europeen de droit international, 26(1), pp.1-7.

Williams, S., 2016. Brexit: What Companies Should Do Next.

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I hope you enjoyed reading this post on Brexit and how it affects future trading arrangements for the UK and EU. There are many other titles available in the business management dissertation collection that should be of interest to business students and academic professionals. There are many dissertation titles that relate to other aspects of business such as strategy, leadership, international business, mergers and acquisitions to name a few. It took a lot of effort to write this post and I would be grateful if you could share this post via Facebook and Twitter. Feel free to add your thoughts in the comments section. Thank you.

Leadership Styles

Leadership Styles in HR Management

The process of globalization is acting to enhance many changes in everyday life of the population of the world, and leadership is considered one of the main means to achieve the desired results in the most effective way. Application of leadership styles in health care organizations is considered extremely important, as human life is the greatest value, as well as those health care workers who apply various leadership styles in order to contribute to people’s health maintenance and as a consequence, to life safety. Examining the concept of leadership, it is very important to distinguish several styles that can be noticed in the modern practice and also provide a clear explanation of traits of successful leaders. Description of real world leaders and their styles and practice would be useful for better understanding of the results of the concept application.

However, first of all, a clear definition of the concept of leadership needs to be provided. Leadership is not a passive theory, but it is a process which represents actions of people. It is important to pay attention to the fact that organization, hospital in this particular case, cannot represent a leader, but only a person can perform this function, as leadership is based on interactions among people (Leedy, Ormrod, 2010).

Leadership is directed to a person or a group of people whose behavior is aimed to be changed. After the aim is reached, these people become the followers and their present is an integral feature of leadership.

As a process, leadership means that some people should be influenced, and there are several ways to act so. First of all, the followers can be changed by intellectual activity; secondly, emotional influence can be applied, and finally, the leader might cause behavioral influence.

Being a complex concept, leadership does not only allow the leader to apply various modes to influence people, but it also gives the leader an opportunity to apply various leadership styles.

Three main styles of leadership can be defined. These are authoritarian, democratic, and free reign style. The first one is used when the leader tells the subordinates what should be done. For example, it takes place when a registered nurse tells their subordinates what actions need to be taken to provide a better health care or follow the rules of the hospitals. This style is appropriate when the leader has enough information and skills and also when the subordinates are well-motivated. Time limitations are acceptable for the style and do not make any significant difference when decisions of the leader take into account real opportunities of the subordinates.

Democratic leadership style is especially popular now. It is applied when the leader believes that it is better to work together with the team. Nevertheless, despite the common work, the leader is the person to make the final decision. However, this style of leadership is applied when it comes to internship in health care settings, as the leader does not possess enough information or skills. Such leaders are not required to have some sophisticated skills, so they start working with other employees who have better qualification. Such style is considered mutually useful, as it enables the leader and the team to make more reasonable decisions.

Free reign style is also applied at health care settings, especially when it comes to the work of nurses. Today their roles are increasing and they perform more and more functions. Some of them, such as medication prescription, are allowed to be performed without control of physicians and this example might serve to illustrate the style. It is important to notice that, despite the fact that representatives of the team make various decisions, their leader is the one to be responsible for them. The style is used only when health care providers are able to analyze the situation on their own and identify what should be done and how it should be done (Service, 2009).

Regardless of the fact which style of leadership is chosen, the leader needs to possess the following traits:

Being self-balanced
Being ambitious
Decisiveness
Enthusiasm
Being self-confident
Realism
Desire to learn
Being just and fair
Being creative, and so on.

The list of the traits can be continued, and it has been proven by Linda Aiken and Geraldine “Polly” Bednash who were recognized to head the list of the nursing leaders. These two nurses have outstanding experience in terms of teaching, research, and clinical practice; they have received numerous honors and credentials for their contribution to the world of medicine and health care provision (Fralic, 1999).

Thus, it is possible to conclude that leadership is extremely important to be applied in every health care organization. The history knows numerous leaders who provided health care and contributed to the health of population, and all of them possessed a range of skills. These are being improved and made more advanced under the influence of the process of globalization.

References

Fralic, M. (1999). Nursing Leadership for the New Millennium: Essential Knowledge & Skills. Nursing and Health Care Perspectives, 20 (5).

Leedy, P.D. and Ormrod, J.E. (2010). Practical research: Planning and design. (9^th ed.). Upper Saddle River, NJ: Prentice Hall.

Service, R. (2009). The leadership Styles Quotient: Measuring toward Improve. Business Renaissance Quarterly, 4 (1).

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Tesla Motors Case Study

With the increased focus on renewable energy driving all, sector the country’s economy. The transport sector has also received numerous recommendations to reduce carbon emissions. It is against the backdrop of these ideal that Tesla Motors Company was created. This case study will examine Tesla motor companies strategies as well as assess their internal and external environment in order to create viable recommendations for a sector, which is highly competitive. This case study report will begin with background information about the company then assess the organisation strategic positions and this will be undertaken with the use of Porter’s five forces and SWOT analysis. The outcomes from this model will aid in the recommendation, which will be vital for the organisations.

Tesla Motors Background

According to Tesla (2014) the organisation was formed in 2003 as a revolutionary car business using the latest technology as its competitive advantage. The car was able to conceptualise and create an independently electric vehicle known as the roadster. The concept of the car designs was Silicon Valley inspired. According to Ehrler et al. (n.d, p. 381) the organisation “designs, manufactures and sells zero emission electric cars and power train parts, such as lithium-ion battery packs”. The organisation has sought for strategic partnerships with companies such as Daimler, Panasonic, Toyota and US department of energy (Ehrler et al., n.d, p. 383).

Tesla Motors PESTEL Analysis

PESTEL analysis is a viable tool used to examine an organisation environment and is crucial in the identification of key areas of improvement as well as potential problems likely to emerge (Yuksel, 2012). The external environment is a factor, un-controlled by the organisation and all the eternities function as influences to the organisation operations as seen in figure 1 below. The models take into consideration the political, economy, the social, technology, legal and environment.

Figure 1 PESTEL Model

(Sourced from: Business and Management: 4th November – 11th November 2013, – PESTLE Analysis, 2015).

Political

According to Tesla (2014), Tesla motors sell their cars in numerous countries across the United States, Europe and Asia and hence, the company is exposed to different political situations occurring in all those countries. According to the Environmental- protection.org.uk (2014), some countries political environment are affected by climate change issues and hence, law enacted to cut carbon emission by a particular percentage and this affects car manufacturers. The US government is offering incentives to car manufactures that endeavour to product cars more efficient and better in utilising green car technology.

Economic

There is an alternative avenue for growth for cars offering cars, which utilise alternative energy. The increase costs of petroleum have made business more difficult and hence, businesses and individuals are in need of an alternative solution to the rising fuel costs. Most developed countries are now recovering from the financial crisis; the purchasing power is now higher, great new for manufacturers who have products that at needed.

Social

Today the word green technology is associated with companies that are considered to be producing products that are good for the environment. Carbon emission from vehicle exhausts are a big contributor to greenhouse gases affecting the earth environments (Wunch et al., 2009).

Technological

The car sector has seen tremendous changes due to technological innovation affecting several aspects of the car efficiency. Vehicles have been going through metamorphosis with car manufactures looking for way of reducing the fuel intake in order to improve efficiency.

Environmental

Eco friendly car is the word spoken to car manufacturer if they rare to remain competitive by customers across the world. With fuel leakages reported in some places, resulting in a loss of marine and bird life, there have been a growing number of environmentalists forcing their government to regulate the sector and allow only fuel-efficient cars on their roads. What happens to the ozone layer is another factor pushing some individual and institutions to consider vehicles, which do less damage to the environment.

Legal

The US has a market presents challenges for Tesla as a car manufactures especially due to the franchise laws in the country (Fisher, 2014). The energy loan program also in the country increases the chances of car manufacturer to produce more green cars in the sector.

All the factors seen above have the effect of directing the way a car manufacturer does business in US. It is vital to determine how external environments affect the organisation in order to work from there, building competence in a way, which is likely to result in a more beneficial manner. Of major significance in the assessment of Tesla’s external environment are the franchise laws, which would stop the company from distributing their cars in some states in the country. However, the much of the external influence faced by the car manufactures geared to more in support of the company and trends show the vehicle sector is set to follow Tesla direction in the future.

Tesla Motors Competences (SWOT Analysis)

In order to determine Tesla’s competences in the vehicle industry, a SWOT analysis is carried out to examine the organisations strengths, weaknesses, opportunities and threats (Hill, & Westbrook, 1997. It is vital to assess the organisation internal capabilities for a more effective recommendation outcome. A SWOT analysis model is presented in figure 2 below.

Figure 2: SWOT analysis

(Sourced from: Doing a SWOT Analysis to Focus Your Marketing Strategy, 2015)

Strengths

Tesla motors have been able to create executive cars, which are totally fuel free and are energy efficient since they are based on electric power, which are saved on batteries. Tesla cars have been able to go for more than 300 miles without having to recharge their batteries and the closest competitor can only reach 100 miles, which is a significant benefit to the company. In 2013 their car, the “Tesla S” was awarded the price as the trendiest car of the year.

Tesla has been able to reduce its input costs significantly through outsourcing of other parts needed for the manufacture of their vehicles and this has allowed the organisation to reduce its costs. Its collaboration with Panasonic is likely to have an even more powerful battery, which is likely to push their cars even further. In addition, its collaboration with Daimler and Toyota has greater advantages and the company is set to provide vital parts for needed for electronic cars for the two companies.

The organisation has invested a large amount of research and development and this is key to pay off in the future when new technology which is likely to further revolutionise the car sector will be a necessity and this goes in hand with their objectives which is to be in the forefront of the electric vehicle sector.

The organisation has been able to utilise just in time JIT manufacturing systems and only those cars, which are ordered, manufactured and this reduces storage costs and enables them to have a smaller facility. This form of lean management process allows staff to become specialised in a vast number of skills hence, fewer staff are able to accomplish the task of the organisation.

Weaknesses

The major problem that Tesla Motors has is a lack of adequate capital base on which to sustain its operational successfully. Despite having sales for its vehicles, the organisation is not making profits and is due to a low demand and high cost of sales, which are eating up the sales revenues.

The organisation is running on debt financing which is expensive and puts the company at greater risks of being taken over if they are not able to pay up its debts on time. The large research and development costs do not seem to bear profits at this time.

The Tesla car brand is not international recognised as compared to other brands such as the Toyota Prius. The organisation has focused on the higher end of the market, attracting only those with considerable resources to purchase the cars.

Opportunities

The opportunities for Tesla are enormous today especially with fuel prices rising, making life difficult for those who have cars that consume a lot of fuel. The car manufactures need to communicate the benefits of their vehicle to the entire car market since the benefits accruing with owning their cars far outweighs having a regular gasoline car. There is a ready market for small fuel-efficient vehicles also which the company has not tapped (Pollet, Staffell & Shang, 2012). Already the car manufacturer is in a sector, which few have tried to venture fully. Those car manufactures who have tried to venture either have hybrid cars of inefficient electric cars as compared to Tesla motors.

Threats

Other car manufacturers have greater financial resourced or sources, which could easily allow them to venture into the niche market, Tesla is viewed as a smaller inexperienced car manufactures are compared to the long term experienced car manufactures in vehicle sector. If other car manufacturer with greater capability for economies of scale to start making electric vehicles, this could affect Tesla revenue sine the organising is not able to manufacture as cheaply as those who are established worldwide.

Tesla Motors Competences (Porters 5 Forces Analysis)

Porters five forces as seen in figure 3 below is useful in assessing a business sector to find how attractive the sector is and who has influence in the sector.

Figure 3: Porters 5 forces Analysis Model

(Sourced from: Porter, 1981)

The Threat from New Entrants

The sector which Tesla Motors company is in has challenges for those who want to enter that market segment. The capital expenditure needed for this electric vehicle sector is very high and keeps new business away from this sector. The only business which may find it easy to enter this market are those existing car manufacturer that have large resources readily available as well as have the capacity to venture fully into this sector.

The Bargaining Power of Buyers

Tesla is a vital company in the electric vehicle sector and today they have a very solid relationship with their customers. Since the company has invested a lot of money and skill in research development, they have been able to manufacture quality products, which are useful for companies such as Daimler, and Toyota hence Tesla Motors power is very high. Tesla has a manufacturer, produces cars which are unique and scarce hence, with increased demand likely to set in the market, they will have considerable power thought, this is only vital if they are able to generate awareness of their brand.

Threat of Substitution

The threats of substitution are the Tesla Motors market segment can be seen from hybrid cars, diesel cars as well as other electric cars and solar power cars. There are also substitutes arising from people choosing to ride buses, trains as well as use bicycles instead of purchasing an electric vehicle.

The Bargaining Power of Suppliers

Since Tesla Motors is highly dependent on its suppliers and this is due to adopting lean management system where parts sought when an order is availed. This means that the suppliers have a higher bargaining power. If the suppliers do not bring the raw materials in time, Tesla is likely to suffer as a result.

The Intensity of Rivalry in the Industry

The global car sector is fiercely competitive with car manufactures competing on a global platform with different categories of their products to cater for different clientele. In the electric vehicle, sectors server car manufactures have created cars, which have not been able to meet the standard of Tesla though; companies such as Nissan have created compact affordable electric cars, which are selling in different countries.

Porter’s five forces show a growing threats to the Tesla car company if they do not work quickly and cater for other segment. This threat can only be from already established car manufacturer. The sector is still inaccessible due to the high capital-intensive investment an organisation will have to undertake and the skill needed to ensure an organisation is competitive.

Conclusions

This case study features Tesla Motors a company that was set up to create in 2003 as a revolutionary car business using the latest technology as its competitive advantage. The car was able to conceptualise and create an independently electric vehicle known as the roadster. The company’s revolutionary cars are set on a global stage, as a car with moves without the conventional fuel. The external environment scanning undertaken through PESTEL analysis of the organisation revealed that the organisation had greater opportunities to enhance their business with support from the American government. The international analysis undertaken using the SWOT analysis revealed that organisation has inherent weaknesses, which saw the company perform in a sector, which is very lucrative due to a lack of adequate finances. Threats in the electric vehicle sector were seen to arise from existing car manufacture, with greater competences as well as finances to build electric vehicles even cheaper than Tesla. Porters 5 forces analysis that was undertaken on Tesla Motors revealed that the sector was very hard to enter by new players in the sector. This was due to the high capital intensity the sector demanded as well as the skills necessary for a business to actually undertake the business successfully. The case study also showed that Tesla Motors strategy was more focused on the upper clientele of the car market with quality, better performance as well as expensive vehicles, which used electricity as compared to petrol.

Recommendations

Tesla was advised by its customer to manufacture a car that was of a lower price but the company has still manufacture a car that is half the cost of its pioneer car thought still relatively high for many to purchase.

Since Tesla is in a sector, which has the highest potential in the vehicle sector, the organisation should find ways of building a cheaper option, which can be bought by a number of people worldwide. Since the companies cars are of the best quality, in order to capitalise on this aspect, selling on mass production could be more beneficial to producing on demand. It is better to derive fewer profit margins and sell more cars, which then equates to a greater profit as compared to selling premium, which affects demand. With threats evident as existing car, companies have started embarking into electronic car sector, this is poised to destroy Tesla cars in the market if those car manufactures are able to manufacture and sell at a cheaper price. This is an aspect Tesla should not forget and having beautiful expensive cars does not equate to profits but rather having a car, which has demand.

The company’s strategy on focusing on premium cars and attracting the rich to purchase their cars is failing with little or no demand. The rich have the capacity to purchase any other car despite the consumption and hence, a change to their focus can create changes to the financial reporting. Coming out early and capturing a greater market share will hinder even existing car manufacturer from venturing into Tesla niche market. The organisation should come out with different models from compact small cars to their SUV since this is a car concept which any individual is unlikely to pass out.

Tesla should embark on selling key part to other car manufacturers to ensure they have a steady stream of revenue apart from selling their cars. This ensures that the car manufacture remains relevant even with increased competition, which is set to grow in the coming years. Being in the forefront or provision of vital innovative electrical parts for car manufactures can even bring in a greater percentage of revenues. Samsung Company has been able to remain competitive as a result of producing vital parts for iPhone which is a major rival.

Tesla should continue with its research and development and produce batteries, which are able to take the car further as well as reduce the time it takes to charge the car batteries, which many view as a challenge when using electric vehicles.

Most importantly, Tesla needs to create awareness of its products to the international market not just in American and Europe. There are many government and organisation, which could benefit from having a car that utilises less harmful substances as compared to petrol of diesel. A greater percentage of the revenue should be spend in advertisement and education on harmful carbon emitted in petrol and diesel consuming cars.

References

Business and Management: 4th November – 11th November 2013, – PESTLE Analysis (2015) Business and Management: 4th November – 11th November 2013, – PESTLE Analysis.

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Yuksel, I. (2012) Developing a multi-criteria decision making model for PESTEL analysis. International Journal of Business and Management, 7(24), p52.

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Business Strategy John Lewis

Business Strategy and Sustainable Development – John Lewis Partnership

John Lewis Partnership is considered one of UK’s major retail businesses that have over twenty seven departmental stores and a hundred and six Waitrose stores. The enterprise is owned and operated as a partnership entity and the first store was set up in 1864 with Waitrose chains coming up in 1904. The first trust settlement was established in 1929 when the business gained a legal entity and profits became available for distribution to all partners; employees. The owner, Spedan Lewis sacrificed his personal business to fulfill his vision of establishing a business owned and run by employees as part of promoting ‘industrial democracy’ in the business.

In 1950, the partnership trust was transferred from a settlement trust to a legal Trust company under the name; John Lewis Partnership Trust Limited. In this arrangement, the Trust company would be under the Trust Chairmanship and his deputy elected by the three governing councils. John Lewis partnership is also regarded as Britain largest worker co-ownership business with more than 63, 000 permanent staffs as partners in the business. In this arrangement, the staffs share business profits and participate in important decisions for the enterprise development. The staffs’ commitment has seen the retail giant garner a unique competitive edge for over seventy five years with unparalleled growth.

One of the major aspects that have propelled the business to greater heights is due to a partnership approach based on understanding that profit is the main aim of business. Another important aspect that has propped the enterprise to its position is a business partnership model anchored on the principle of social economy and the integration of workers as company partners. All these have shaped the structure and principle of the company into a cooperative ownership that shapes the company policy and development.

John Lewis partnership has a legal form based on governing partnership and at no time are business operations directed by shareholders quest for profits but principles of the members’ happiness as enshrined in the partnership constitution. In particular, workers happiness comes from good job performance in enhancing successful business. The partnership constitution has ‘responsibilities and rights’ which enjoins the workers obligation of good job performance with overall betterment of the business for their benefits.

Evaluating John Lewis Partnership principles of conscious capitalism

John Lewis partnership is governed through principles of power, purpose, members read and profits. The principle of purpose dictate that the aim of the partnership is to promote, enhance and facilitate the happiness of its members through their work as employees in the business and as managing members of the business success. The partnership is based on trust and each member shares genuine responsibility of ownership and rewards that are accrued from the business entity such as knowledge, power and profits.

Conscious Leadership

At John Lewis, all employees are co-owners in the business a democratic management structure run the business. Power is held in esteem by John Lewis partnership and there are three governing authorities that share power; the partnership Board, the Partnership Council and the partnership council. The principle of profits in the partnership dictates that, the enterprise make more profits through its trading operations in order to sustain its commercial prominence, finance development activities and distribute part of the profits to members. Furthermore, the principle of profits making aims to enlarge the enterprise returns that enables the business engage in other activities in accordance to its goals.

Under the principle of members, the partnership constitution is to increase more employees who are competent and committed to working and supporting the enterpri9se principles. In the principle of membership, courtesy, mutual respect and equality among the different members is highly encouraged. The aim is to enhance and encourage individual contributions fairly and reward each accordingly.

Evaluate the principles of conscious capitalism

The concept of conscious capitalism refers to establishing enterprises that implement practices which benefit people and the environment (Mackey, 2013:123). The concept of conscious capitalism is tied to conscious business that is gaining popularity in the modern age especially with regard to increased demand for corporate social responsibility by many business enterprises. Conscious capitalism is ‘values-based’ economic values that push for social and environmental concerns for business as they pursue their economic interests (Baron and Cayer, 2011: 344). The principle of conscious business is driven by the belief that when conducting business, it is not just for profit but facilitating social environmental responsibility for the general good.

Principle of Conscious Culture

Besides a democratic management structure, John Lewis has upholds the principle of radical transparency when conducting all business operations. All employees (co-owners) share, inquire, criticize and tell the management all that is important (Laszlo and Zhexembayeva, 2011:156). Each partner has a priority to voice any aspect deemed necessary regardless of age, education or experience.

Another aspect of conscious culture at John Lewis is its conscious consumerism through socially responsible investments (Zender, 2015). Ideally, the principles of conscious capitalism are based on certain criteria that demand businesses do no harm while undertaking their enterprise operations. One principle of conscious capitalism is that the products and services of business enterprises should never be harmful to the environment or people. This requires business to have mechanisms that forestall social and environmental effects while doing business as well as adopting beneficial social and environmental practices (Korschun, Bhattacharya and Swain, 2014).

Another principle of conscious capitalism is the triple down line model of doing business. Under the triple down model of doing business, the aim is to promote positive value in domains such as the planet, profits and people (Mackey, 2013:123). Profits are what distinguish an entity as a business and not social enterprises. As such, the degree to which an organization has adopted ‘conscious capitalism’ may be reflected in how it utilizes part of the profits for social and environmental welfare. In modern firms, there is a tendency to utilize part of the profits accrued in business for social welfare through donations or establishing an organization foundation whose purpose is social welfare; a good example is the Aga-khan Foundation, Bill Gates Foundation among others.

In line with the principles of ‘conscious business’ firms that have an understanding of conscious capitalism should desist from accumulating profits through illegal means or deceitful operation practices such as failing to pay employees, poor working conditions or supporting harmful causes. For instance, the recent revelation that HSBC Swiss Bank has been evading tax cuts is an example of a business operating without conscious culture principles. The bank is alleged to have allowed bank transactions involving stolen oversees funds and this disqualifies the bank as being a ‘conscious business.’

A conscious business seeks to enhance the external and internal lives of its stakeholders (shareholders, clients, neighboring community and importantly its employees). In addition, a conscious business should benefit its other stakeholders such as the suppliers, creditors and humanity at large globally. Business enterprises embrace consciousness by forming welfare workplace programs, fair trade in manufacturing and assisting the general community with outreach programs. A business that is conscious aims to reduce the effects of its business operations on the environment in various ways such as engaging in recycling, using renewable energy and working with environmentally conscious partners.

Furthermore, businesses that are conscious use their resources in benefiting the environment and the society through direct or indirect programs related to the distribution of services and products. It has become increasingly important for businesses to reflect their ‘conscious capitalism’ spirit in the way they treat their employees and other stakeholders. Businesses are increasingly reflecting their consciousness through their company missions and values. In particular, paying employees well, donating services and products to non-profit organization is considered a good conscious business spirit. Operating under the spirit of conscious capitalism model pushes the fortunes of a business up by projecting a positive role of improving humanity in the society.

Conscious capitalism helps business to create value and ethics of economic exchanges, elevate humanity existence and creates prosperity by lifting people from poverty. In addition, when business operates on higher purposes other than the pursuit of profits, businesses creates value for all stakeholders, eliminate tradeoffs and elevate performance. The key pillars to conscious capitalism is having; higher purpose, stakeholder integration in the business, conscious leadership, management and culture (Rooke and Torbert, 1998). Neglecting one pillar would lead to jeopardized principle of conscious business. Examples of companies that have successfully embraced conscious capitalism are Google, POSCO in South Korea, Patagonia among others. These companies have created win-win situations for their customers, suppliers, employees, the general community and the environment.

Although conscious capitalism is related to corporate social responsibility, the two are different, Conscious capitalism purposes on creating value for the community stakeholders through actively engagement in business decisions as opposed to engaging them in periphery business programs (Fialka, 2006: 4).

The principle of conscious stakeholder integration

John Lewis Partnership is an example of conscious capitalism on many fronts. First, the partnership is based on conscious purposeful principles whose objective is promoting social economy (Mackey, 2015:1). By developing a co-ownership with workers is one important tenets of conscious capitalism employed by the partnership. Employees are important stakeholders in any organization and play critical roles in the success of an entity (Burden and Warwick, 2013: 3). It is common knowledge even among the company shareholders that employees are the cogs that support the organization in achieving its objectives and goals.

John Lewis Partnership is keen in building transformative relationships and co-develops solutions with all key stakeholders. John Lewis progressively builds transformative relationships with clients, employees, the local authority and charity organizations in its pursuit of sustainable business. In this way, by integrating the interests of all its stakeholders in the core of business activities, John Lewis is an example of a conscious capitalism.

Although organizations may boast of effective leadership, without competent and committed employees becomes an exercise in futile for mangers. Employees’ posses’ important skills and experience on areas that need improvement in the firm based on their day to day interaction with the various aspects of an organization. As such, having competent, committed and selfless employees is not easy and many modern firms are spending heavily in incentives and welfare programs meant to boost employees’ morale for performance (Mackey, 2015:1). Although these employee betterment programs are related to the principle of conscious capitalism, they are less effective in taping employees’ contribution to the firm. John Lewis might have done a critical assessment on these issues prior the development of a co-ownership with thousands of staffs at the retail enterprise. Enjoining employees in business ownerships serves many advantages. One is that employees contribute selflessly and actively in shaping the firms development policy based on their day to day work. Employees are not only motivated to work hard for the business but consistently strive to innovative new ideas that will benefit ‘their’ business.

In addition, the aspect of ‘owning’ the business and being part of decision making helps to improve employees motivation, cooperativeness and overall a corporate culture of harmony (Hind, Wilson and Lenssen, 2009: 23). John Lewis notes that, by enjoining thousands of his staffs in the business, he promoted ‘industrial democracy in which each employee has a fair equal responsibilities and rights in the affairs of the organization. The key pillar in John Lewis Partnership is promoting the happiness of its members who are employees. Human resources studies have found that, motivated and happy employees means happy customers and subsequently increase in sales returns (Somerville, 2013: 2). As such, by promoting the a conscious capitalism approach that focuses on improving employees happiness, the Partnership is a win-win model; employees will strive to make clients happy in return for good business to their partnership business (Abergene, 2005: 23).

Furthermore, by enjoining the employees in the business, this helped improve their welfare by raising their income thereby improving their social economy. In this way, by focusing on the general welfare of employees, John Lewis serves as an example of working ‘conscious capitalism’ enterprise. John Lewis is a good example of a ‘conscious business’ through its conscious management and leadership (Hind, Wilson and Lenssen, 2009: 23).

The Partnership enterprise is government by a well-structured constitution that establishes three centers of authority. These centers of authority promote democracy in the management and running affairs of the business especially in decision making; all employees are members while assessing the business problems. In this way, John Lewis partnership serves as an example to other businesses on what true conscious capitalism means.

Although modern firms allege to have conscious business, employees do not take part in decisions making and are often used as tools to achieve end goals. An example in case is Barclays bank that boast of a ‘conscious business’ but has been implicated with cases of employees mistreatment, underpay and contributing resources to programs that have hazardous effects on the welfare of humanity at large (Smith, 2013: 2). At John Lewis Partnership, employees have absolute freedom of openness in the management of the business; employees can inquire report and raise criticism based on actions deemed unsuitable for the business (Brown, 2012: 73).

Employees’ share business rewards, power and knowledge at the partnership and this has enhanced the firm have a competitive edge against conventional business those that treat employees as mere operational cogs in a business. All employees have equal opportunity to promote their potential and hold principle management positions in the Partnership Council. The management structure and organizational culture allows for two ways decentralized communications among the members. In this way, no individual feel neglected or out of the management structure (Lin, Hu S-y and Chen M-s, 2005: 534).

Another aspect of ‘conscious capitalism’ exhibited by the partnership is that, it does not condone or take part in social positions, sex, gender and political favoritism.’ This is a rare feat of ‘conscious capitalism’ especially in the modern world where most businesses take positions in social, political and religious matters (Burden and Warwick, 2013:2). According to Mackey (2013: 123), business enterprises project conscious business by contributing to the larger community in which they operate. At John Lewis Partnership the entity contributes to the general community in distinct ways. In particular, the enterprise has established links with Schools, local authorities, charitable institutions and other stakeholders in the community as part of giving back to the community (Shumate and O’Conner, 2010: 580).

John Lewis Partnership has important community outreach activities include the Partner volunteer work, charitable giving and development, customer panels and others. The principles established by John Lewis are strong indictors of a business operating under the principles of conscious capitalism. In particular, the entity main objective is to make more profits not for the purpose of enriching private shareholders but for the general good of partner members and the society at large (Korschun, Bhattacharya and Swain, 2014).

In summary, it is evident that the John Lewis entity was not formed with the sole aim of profit making but to facilitate social economy for members and the society at large. John Lewis Partnership serves as a good example of a conscious capitalism through its interest in the welfare of its employees and other stakeholders such as suppliers, having a conscious management structure, leadership, and democratic work culture and spreading the fortunes of the business to surrounding communities.

Conclusion

Conscious capitalism is an important aspect for modern business. The principle of conscious capitalism enables business organizations to surmount myriads of problems associated with employee management, stakeholders’ relation and projects a good role model in the society. Conscious capitalism facilitates free enterprise capitalisms that uphold social and environmental interests beyond economic interests. Conscious capitalisms is inspired by the need to improve humanity welfare, create business value to all stakeholders and improve organization performance competitiveness against conventional enterprises. Conscious capitalism is pillared by stakeholder integration, having conscious leadership in organizations, conscious management, conscious working cultures and creating value for the general community at large.

John Lewis Partnership is a good example of a successful ‘conscious capitalism’ that enjoined its employees as co-owners. The principles adopted by John Lewis have enhanced the firm uplift the welfare of its employees, suppliers, shareholders and the general community at large. Conscious capitalism is inspired by the need to improve social and environment needs in line with achieving economic gains. In short, conscious capitalism is means through which the ends goals of company profits are increased due to improved social reputation. John Lewis Partnership is a creation of conscious capitalism and this has enhanced the enterprise to remain competitively profitable as the largest retail store in UK.

References

Baron, C. M., & Cayer, M. (2011). “Fostering post-conventional consciousness in leaders: Why and how?” The Journal of Management Development, 30(4), 344.

Brown, B. C. (2012). “Conscious leadership for sustainability: How leaders with late-stage action logics design and engage in sustainability initiatives.” Dissertation Abstracts International, 73(07A), UMI No. 3498378.

Fialka, J. (2006). “Some Companies Move From Opposition to Offering Proposals on Limiting Emissions. “Politics & Economics: Big Businesses Have New Take on Warming”. Wall Street Journal. p. 4.

Hind, P., Wilson, A., & Lenssen, G. (2009). “Developing leaders for sustainable business.” Corporate Governance, 9(1), 7.

John Mackey (2015): “Why Companies Should Embrace Conscious Capitalism” Forbes.

Pete Burden and Rob Warwick (2013). “Exploring Conscious Business Practice: Sensing as we act reacting to what we sense” AMED.

Korschun, D.; Bhattacharya C. B.; Swain, S. D. (2014). “Corporate Social Responsibility, Customer Orientation and the Job Performance of Frontline Employees.” Journal of Marketing 78 (3): 20

Rooke, D. & Torbert, W. R. (1998). “Organizational transformation as a function of CEO’s developmental stage.” Organization Development Journal, 16(1), 11-28.

Smith, Nicola (2013). “Corporate social responsibility: Power to the people”.

Shumate, M; O’Conner, A. (2010). “The symbiotic sustainability model: Conceptualizing NGO-corporate alliance communication”. Journal of Communication 60 (3): 577–609.

Somerville, Michael (September 13, 2013). “Nearly half of Britons would buy more from a store that supports charity”

Zender Tom. (2015). “Discover the power of consciousness in your business.” Phoenix Business Blog.

Abergene, Patricia (September 2005). Mega Trends 2010: The Rise of Conscious Capitalism. Hampton Roads Publishing Company.

Mackey, J. (2013). Conscious capitalism : liberating the heroic spirit of business. Boston Mass.: Harvard Business Review Press.

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Effective Managers Born or Made

Effective Managers Are Leaders Born or Made?

Research Title: Effective Managers. “It is often believed that effective managers and problem solvers are born rather than made and have a kind of magical power to understand and transform the situations they encounter. If we take a closer look at the processes used, however, we find that this kind of mystique and power is often based on an ability to develop deep appreciation of situations being addressed. Skilled leaders and managers develop the ability of reading situations with various scenarios in mind and of forging actions that seem appropriate to the understandings thus obtained” (Morgan, 2006).

The major task of the leader is to bring their followers from where they are to where they have not been. Acting like a manager and problem solver is an enormous job. The good and worst manager is remembered by the people throughout the history. From many years people are debating whether the effective managers are born or made. Some researchers believe that the effective managers are born with the necessary personality traits that make them successful (Bernard, 1926). On the other side most of the researchers has a firm belief that the effective managers are made. (Bernard, 1926; Blake et al 1964, Drath et al, 1994; Fiedler, 1967; and House et al, 1974) Let us assume that effective managers are the person born with the abilities to inspire and influence others. We can take a simple example on this statement. Sometimes we see a little girl influencing her brother and parents with their inherit abilities to do the things she wants to do.

If we take effective manager as a person who is courageous and willing to speak for the betterment of the people around him than we can say that the effective managers and leaders are born. In our surrounding we can see people who are introvert and are always in followers by nature but sometimes at a particular situation about which he was passionate will prove himself a good leader or effective manager. So by this we can assume that one can become effective manager by continues training and experiences. Saal et al (1988) stated that leadership is not necessarily in born, some skills could be taught to employees to make them an effective leader.

This issue is still inconclusive although many researchers have found that the effective managers are made not born. In previous years many theories has been given to reach at a specific point. Some of the most known theories on this issue are: Great man theory, Trait theory, and behavioral theories.

Great Man Theory

According to this theory the leaders are different from other human beings. They do not need to develop intellectual brain to lead, but they have the right set of inherited capabilities which is not equally present in all the human beings. The basic assumption of this theory is that effective mangers are born not made and they contain some inherited traits that make them successful. These great people arise with the need.

A lot of research in 19^th century was based on this theory. Most of the researchers have developed a link between the Great Man theories and the work of Thomas Carlyle who was a historian. He revealed that the leaders are the person who has naturally gifted capabilities and can capture the imaginations of the masses in a better way.

In earlier times it was considered that the qualities of effective manager is associated with man and this theory is named as a great man theory but in later year when so many great woman emerged as a effective manager that named the theory Great person theory.

According to the great person theory some person born with the necessary qualities that distinguish them with other persons. These inborn traits of a person make him responsible for the position of power and authority. This theory claimed that an effective manager within born attributes can achieve the goals for their followers by facing all the obstacles in his way. This theory implies that those who are at the positions of authority and power are just because of the gifted attributes they have. Moreover this theory also argues that these gifted traits of the effective manager remain stable over the period and in different groups.

Trait Theorists

Trait theory is basically all about the characteristics of the effective manager. This theory relates to the physiological characteristics including appearance, height and weight, demographics i.e. age, income and education, personality, self-confidence, intelligence and social characteristics with management effectiveness. Successful managers have some characteristics and traits that make the manager different from the unsuccessful manager. Researchers in 20^th century have identified the set of the traits that are responsible to make an effective manager. These traits are achievement drive, motivation, honesty, self-confidence cognitive ability, knowledge about the practical things, creativity charisma and flexibility. An effective manager with good judgment, strong analytical skills can better solve the problems of any situations.

This theory is a naturally pleasant theory that tells us about the elements that make the effective manager and the leader. Trait theory of leadership has a great implication in all types of organizations and all positions. By utilization of information given in the theory people can evaluate their position and determine how they can make their positions strong.

Stogdill (1974) claimed that the people who are effective managers have right combination of attributes including achievement-orientation, ambitious and determination.

The trait approach gives rise to the issue that the effective manager is born or made or whether it is an art and science. According to the trait theory sometimes we can consider effective manager and leader an art but still there is a need of some skills to be successful. Even if there are some in born characteristics that make the person an effective manager still some kind of development and encouragement is also need to make him a successful leader.

Behavioral Theories

Behavior theory is based on the assumption that the leaders are made rather than born. Effective managers are basically the learnable behavior. Behavioral theories not actually based on the inborn traits and rather this theory focuses on the actions of the managers and leaders. This theory stated that it is easy to learn than to adopt the short-lived traits. Behavioral theory is contrary to the trait theory. Behavioral theory assumes that the effective manger and problem solver capabilities can be learned but trait theory assumes that these capabilities are inherited. This theory has opened the flood gates to the leadership development.

Leaders are born

The idea that leaders are born rather made is given by the two well-known theories great man theory and the trait theory. Robins et al (2006) stated that every person personality is comprised of unique psychological characteristics. This uniqueness make person different from the others in the sense of their reactions towards the certain things and interaction with the people. This can be clearly observed in the person born with the leader characteristics-the certain make the leaders different from the non-leader. The great man theory argues that the great man and heroes are those who born with the abilities of chrism, intelligence and wisdom which they utilized in such a way that make them successful.

Example for the clarification of the Great Man Theory

If you will see an eagle running on the ground you will immediately find that an eagle is not good in running. This is because it is not naturally balanced and usually compensates it by sticking their wings out. The eagle is not appropriate for running, even if someone give him training. The training to improve the eagle running will not bring the improvement.

Leaders are made

According to the behavioral theories leaders are not born. Leaders can be developed by proper training and observations. Behavioral theories depend upon the actions of the manager not on the psychological or physiological characteristics. Cawthon (1996) revealed that the people born with equal abilities and equal traits.

Knowledge and skills person learn directly contribute in the process of leadership, while the other personal characteristics make the leader unique. According to the process leadership theory people can chose to become the effective manager by learning leadership skills. Werren Bennis is a well know researcher of leadership. He believes that every person can become a leader through years of learning and experience.

Dr Carol supports this argument by saying that people can develop leadership skills by their dedications towards work and hard working. Moreover he said that intelligence and brain is the starting point of the leadership development. Powel said that the effective leaders are made not born. Effective leaders learn from the trial and error and from their experiences. They learn from their failure and use this learning in future for solving the problem.

What make an effective leader?

An effective leader does not need to be holding some specific attributes. Harry Truman the most effective executive in US do not have even one ounce of charisma. When Truman becomes the president of the US he knew that what he wanted to do. He found that after World War 2 he should focus more on foreign affairs. He started his work by taking tutorials on foreign policy. As a result he becomes the most effective president in the US foreign affairs. Similarly while working in some well-known business firms I found CEO’s who were not the stereo typical leaders. These types of CEO’s are all over the world. They are varying in attitudes, personalities, strength and weaknesses. They ranged from extrovert to introvert from easy going to controlling and from generous to economical in nature. This shows that it’s the inherited attributes that make the person leader but they follow some practices that make them an effecter manager.

Drucker (2004) stated that the Great managers can be charismatic or tedious, kind or miserly, creative thinker or numbers oriented. He stated that effective executives follow eight practices that make them the effective manager. These practices include what need to be done? What will be a write decision for the enterprise? They developed a detailed action plan. They took responsibility of making decisions and communicating to the followers. Their main focus is on the prevailing opportunities rather than problems. They arrange productive meetings and they thought as we rather than I.

Importance of emotional intelligence in leadership development

In our practical life we usually go through such stories that a person who was highly skilled and intelligent promoted to the leadership position and get failed and another person with limited skills and intelligence promoted to the same leadership position remain success full. Such anecdotes make our belief strong on the perception that the leaders are born. The personal styles of the leaders also very and in different situation different types of leaders usually emerge. Studies found that the most effective leader is the one with high degree of emotional intelligence. This argument doesn’t meant that intelligence and technical skills are useless in the leader development. They do matters but as a threshold capabilities. These are the basics requirement of the executive position. Goleman (1998) in his research claimed that without emotional intelligence a person cannot become a leader. He pointed out that a person with extensive trainings, analytical mind and endless supply of smart ideas cannot be a good leader unless he has high level of emotional intelligence.

Skills required for effective manager

Much research has been conducted in previous years to see the relationship between the individual trait and the effective manager. The most of the studies revealed that the individual trait alone does not guarantee a success flu and effective manager, Individual needs to learn certain skills according to the prevailing situations to become and effective leader. Kirkpatrick et al (1999) in their study on the “Leaders: Do traits matter” revealed that the person traits is not the only thing that contribute in the success of the manager. They revealed that besides personal traits they need motivation, cognitive skills and the knowledge of the business. The result of the study is also consistent with the behavioral theory that the skills of the manger matters rather than in born traits. Stogdill also revealed that the any individual cannot become the leader by the virtue of the some traits he possesses. Stogdill research shows that personal or in born trait is universally associated with the effective manager, it the skills that person adopt in certain situations make him effective manger. Some of the skills that individual should learn in order to become an effective manager is discussed below.

Cognitive skills

Cognitive skills are the primary skills that are required for the effective leadership. These are the skills that are related to the basic cognitive capabilities. These are the skills include collecting, processing and disseminating information and learning. Communication skills like speaking are also important to convey the message effectively. Written skills are also important to learn for effective communication. To be an effective leaders need to develop active learning skills this enables leaders to work on new information and to learn its implications. These skills help managers to adopt behavior and strategies to solve non- routine problems effectively. Gilllen et al (1985) stated that the critical thinking is also an important aspect of leadership in order to analyze the strengths and weaknesses of different approaches of work. Kirkpatrick et al revealed that the manager must gather and integrate the enormous amount of knowledge about the functions of the business to become an effective manager. By getting detailed knowledge about the business, manager can effectively formulate the strategies, solve problems and make decisions.

Business skills

Business skills include the skills that are related to the functional area of the field of the leader. This includes the knowledge about the contexts in which individual work. Business skills also involve the management of the resources and operational analysis. In addition it also involves management or personnel resources to motivate followers for their work. The skills of managing financial resources also come in business skills. Harvard professor Kotter said that the expertise in business is more important the knowledge.

Interpersonal skills

The term social skills refer to the person’s ability of making relationship at the workplace. People with high social skills are found to be mean-spirit. Socially skilled person has wide connections. They have the ability of finding common ground in people of different types. They work on the assumption that nothing can be done alone. These types of people have a detailed network of the people that they can use at the time of action. In every company social skills is considered to be the key capability of the leaders. To be an effective leader a person should develop its social skills. No leader is the island. After all the work of the leader is to get things done by the people and it is not possible without the required social skills.

Strategic skills

The strategic skills are the highly conceptual skills. These skills are needed for the understanding of complexity, dealing with ambiguities, and influencing the organizations. Strategic skills include planning-related skills of imagining the systems and problems in different situations. The environment scanning skills is also an important skill that individual should learn to become an effective leader. Environmental scanning skills are related to the identification of downstream consequences and identification of key causes of the problem. These strategic skills also contains some problem solving components including problem identification this help in determining the true nature of a problem that is faced in the organization. Effective leaders also need to learn the solution appraisal and objective evaluation skills in order to evaluate the solution of a problem in an appropriate way.

Organizational culture and Leadership development

The role of culture in making of a leader gets overlooked. The culture of the organization also plays an important role in supporting and hindering the development of the leader. Organization culture is basically the values, beliefs, rules and practices of the organization. Most of the managers do not account the role of culture while making a leader in their organization. The most considerable reason of neglecting culture influence in the development of the leader is their wrong understanding about their culture. But failing to understand the role of culture in making the effective manager can be costly.

Some executives have a wrong perception that sending managers in the leader development program can produce better leaders that can handle the challenges in a better way. But there is more to do with the managers to make them an effective lender. To build an effective manager, organizations need to focus on the context in which the development of the leaders takes place. Organizational culture is the more significant part of the context. For making a good leaders organizations needs to assess the drivers and the culture of the organizations.

Role of Work motivation in building effective managers

Motivation is the psychological and physiological urge of the individual. Motivation helps in activating the behavior and drive that helps in achieving some goal and objective. The motivation level of the individuals very situation to situation. The situations in which individuals are working have an influence on the level of motivation. There are certain ways in which the motivation level of individuals can be improved. These factors are important in making the effective manager

Job enrichment

Organizations who want to develop effective manager must design their jobs in such a way that increase achievements, recognition, responsibility and growth. The work assigned to the managers should be compromised of work contents, greater use of skills and increased authority.

Flex time

Organizations should provide employees with flexi time. This flexi time will help the manager in determining their own work schedules. Providing flexi time with the core time will help in developing effective manager.

Quality circles

Some autonomous work groups should be defined that meet on daily basis to solve some problems. By the help of these groups they will exchange their experiences and ideas on problems. This will help the managers in learning from other experiences and skills.

Organizational reward system and effective managers

The organizational reward system has been found strongly related to the development of the effective manager. Fair pay benefits and promotions motivate the managers to learn new things and to develop the skills. Employment recognition system is an effective tool of making the effective manager. When organizations give recognition and rewards for the task they performed they will motivated to repeat their efficiency in the future days.

Problem solving

Middle and senior level management are seems to be more engaged in problem solving. The results of the problem solving are dependent on the allocation of the resources and work results. The situations in which the problem solving activities are take place are often complex, unstructured and non-routine. Sometimes the problems occur are beyond the control of the manager. Managers lacking in sufficient life experiences and training found problems beyond their control. Effective managers normally follow some steps in order to solve a particular problem. In First step manager identify the problem by gathering and evaluating the information. After gathering the information regarding the problem managers makes logical assumption based on their prior experiences. Tentative alternate solutions are developed and each alternative is than considered in depth. On the basis of decision criteria each alternative is evaluated by the manager. Only that alternative is selected which best fit with the criteria. After selection of the best alternative the solution is implemented. The results of the solutions are evaluated with time.

Conclusion

After the thorough review of the theories and literature it is evident that we cannot support a side and negate the other side when it comes about the discussion of whether leaders are born or made. The studies show that the both in born characteristics and the skills adoption is important to become an effective leader. Leadership can be learned by many ways but cannot be taught, Leaders learn 80 percent of things from their job. They learn by monitoring others leaders, by taking feedback, by coping with the multiple situations. Leadership is basically the life time learning.

The insight on the previous literature shows that trait is not alone sufficient for making an effective manager. These are the only preconditions of becoming an effective manager. An individual with certain traits needs to adopt certain skills and knowledge to become an effective manager. Possessing some traits enable the individual that he can also become the effective manger by adopting some required skills.

Leadership can be something an art but application of special skills and techniques are required in order to be successful. Even if there are certain inborn qualities that make one a good leader, these natural talents need encouragement and development. A person is not born with self-confidence. Self-confidence is developed, honesty and integrity are a matter of personal choice, motivation to lead comes from within the individual, and the knowledge of business can be acquired. While cognitive ability has its origin partly in genes, it still needs to be developed. None of these ingredients are acquired overnight.

These executives need to accomplish the importance of the culture in the development of the leaders. They need to factor the organizational culture in a way that helps in building leaders. Organizations need to understand their culture. By thorough understanding of their culture organizations can determine that which factors in their culture can hinder and enhance the development of the organizations.

In a nut shell we can say that in born attributes is the pre-condition of becoming an effective manager but to become successful leader individual should adopt some skills relevant to their business. Although a leader born with set of qualities that make it different from the non-leaders but there is an influence of other environmental factors in making him the one of the successful and effective manager.

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