Category: Business Management Essays

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Business Management Essays

Effective Leadership

Title: Effective Leadership – Within this study, the topics being synthesized are the philosophy of leadership within the 20th and the 21st century. Furthermore, the skills and characteristics of a leader or manager are going to be synthesized, showing the reasoning behind having these certain skills.

Evaluate the philosophy of leadership within early years settings by critically analysing the characteristics and competencies of leadership. Ensure that you include why it is essential to have a leader who understands the importance of an effective and multi-disciplined team of staff

Over the 20th and 21st century the term leadership has been changed several times and the perception of what a leader is has also changed. Extensive research has been taken under the topic of ‘leadership’, it has been discovered that through the 20th century there have been more than two hundred different meanings (Northouse, 2010). In the early 1900’s it has been seen that leadership was defined as the centre of power and domination and further down the line in the late early 1900’s the term was defined as persons having certain skills, values, motives and also being able to deal with conflicts (Northouse, 2010). However, Bonnici (2011) explains that leadership is about receiving praise, it is about being influential to teams and improving the student’s way of learning. Traditionally, leadership has been defined as a person having certain personality traits and qualities (Rodd, 2006). However, in recent research the definitions of a leader have been associated with shared ideas and working together (Dunlop, 2008)

Furthermore, Effective Leadership is perceived as inspirational, influential and charismatic, whereas management is about the organisational techniques and controlling things (Walker, 2011). Essentially, leadership is constructing and sustaining a vision and interpersonal relationships and management is monitoring activities and functioning (Davies & Burnham, 2003). There are many misconceptions of the term leadership and is usually mistaken as ‘Power’, this is down to the progression of influence (Northouse, 2010).

There are many general leadership theories and few well known. House and Mitchell devised the Path-Goal theory which is centralised on a model of motivation and is a part of the contingency approach (Burnes, 2004). The leader must provide the employees with support, confidence, and influential behaviour to feel able to attain their future goals (Burnes, 2004). There are two different situational contingencies within this approach; one being staff member’s individual characteristics and the second being the environment which they work in (Alanzi and Rasli, 2013). This theory involves around different situations and behaviour and how the leader’s motivation could lead to other staff being achievement-orientated (Alanzi & Rasli, 2013). However, there is a lot of debate whether path-goal theory is efficient within settings and Alanzi and Rasli (2013) explain further that good leaders will know and understand when and what approach to use when needed. Furthermore, Devader and Alliger (1986) discussed that using the Meta Analyst approach and self-report measures of 120 surveys and discovered that the evidence of its efficiency was infrequent. From the surveys that were conducted analysed, they discovered the environment and the task would not be adequate, it will not change the behaviourism (Devader and Alliger, 1986). Therefore this implicates that the behaviour of the leader will not affect the performance of the subordinates (Devader and Alliger, 1986). The weaknesses involved in the path-goal theory are lack of research and findings. However, Aubrey (2011) explain that the theory does not encourage the staff/team to act themselves as leaders when needed.

Psychologist Kurt Lewin formulated this style of effective leadership in the 1930s and many people followed his path. Lewin debated that there are three key aspects to the styles, these are Autocratic, Democratic and Lasseiz-Faire (Lussier & Achua, 2015). Lewin believed through his studies a leader is not solely based on personality traits but he moved towards different behavioural styles (Lussier & Achua, 2015). However, Lewin has also gained many criticisms of this three step approach and academic sources have noted that he has been progressively critiqued as only appropriate small scale alterations in stable environments and also stated that his model has issues of ignoring conflict and organizational politics (Burnes, 2004).

The autocratic style involves a leader who dictates methods of work and staff, struggles to involve staff in decisions of the setting and also limits the staff to doing different jobs (Khasawneh & Futa, 2013). This could be a leader is the owner of the business.). Therefore, this leader could be over-ruling to staff and lead parents/staff feeling under-valued (Johnston & Williams, 2012). Within an early years setting, it is vital that parents and staff feel welcome. If staff are not enjoying their job, this may lead to retention (Sadek & Sadek, 2004). Similarly, Sadek and Sadek (2004) explained that an autocratic leader is ‘like a spider in the middle of the web’, this could indicate that the leader is the only one with the control and power. Nonetheless, there are positives of the style such as the leader of the setting/business is the only one able to make decisions, also this could mean that the leader makes sure things run smoothly (Johnston & Williams, 2012).

The second of the style is democratic; this type of leader is able to welcome ideas and encourage staff to participate in all decision-making and closely watches/supervises (Lussier; Achua, 2015). A style like this could be welcoming, and staff may feel as though they are able to input their ideas as to what needs to be improved and sustained (Johnston & Williams, 2012). Lussier and Achua (2015) indicate that the democratic style increases the chances of staff feeling a valued member of the team, this will lead to present and future motivation and commitment. However, Johnston and Williams (2012) discuss that staff may misunderstand and feel as though the democratic leader may not have any true values or visions themselves. Furthermore, being a democratic leader in a setting will be more organised and have staff feeling valued to the leader (Johnston & Williams, 2012).

The third style is called ‘Laissez-faire’ which is also seen as non-directive and leaders who pursue this style may prefer to let the group of staff set their own goals. However, if problems arise within the setting, it is likely that they will be unable to get the staff back to being positive and motivated (Wood, 2012). However, leaders within an early years setting acting in the style of ‘laissez-faire’ could lead the other practitioners to become somewhat lazy and inefficient (Wood, 2012). In addition, Johnston and Williams (2012) state that a setting ran by a laissez-faire leader would come across and welcoming to children, parents and recruiting new staff. However, a setting ran by a leader who wants to work for an ‘easy life’ could also be seen as chaotic at times due to the lack of management (Lussier & Achua, 2015). Similarly, Wood (2012) adds on explaining that staff could lack in vision or no direction, also this could lead to future retention as the staff feel unsatisfied with the way the setting is.

Furthermore, Goleman’s research indicates that the visionary or effective leadership style is the most efficient and this is by making the vision everyone’s future goals (Burns, 2010). Leaders with this set style are able to connect with every individual in the workplace and know their capabilities and be able to give them time to grow and also how to achieve their goals (Mersino, 2013). Staff are able to benefit with this type of leader as they are able to tell them what they are doing right (Mersino, 2013). Visionary leaders heavily rely on the competencies, emotional intelligence, self-confidence, self-awareness and the ability to be empathetic to staff or others involved (Wood, 2012). In contrast, there are many issues with this style as Burns (2010) did not define how to be a visionary leader, this could come across as confusing. Furthermore, as this happened many researchers began to analyse the theory and show the cracks of it (Solan, 2008). Similarly, Bennis and Nanus (2003) searched further into the term ‘vision’ and researched into the behaviours of leaders with this style. They set out to do qualitative research and interviewed 90 different leaders. To add on Sashkin and Sashkin (2003) explained that Bennis and Nanus (2003) discovered that leaders have five different patterns of behaviour which were all down to trust, confidence attention and more.

One of the earliest leadership researches was based on characteristics of efficient leaders by Gregoire and Arendt (2004) who split these into a group of 5.

  • Surgency: – The traits being the individual characteristics and sociability.
  • Conscientiousness: – Dependability, the need to achieve and integrity.
  • Agreeableness: – Positivity, usefulness and connection.
  • Adjustment: – Emotional Intelligence, self-worth and strength of mind.
  • Intelligence: – Desire for knowledge, broad-mindedness and being learning orientated.

Since this approach based of characteristics, Jillian Rodd (2006) discussed personal assets of an early year’s leader. However, Jones and Pound (2008) indicate that characteristics, attitudes and skills are the base of an early year’s leader. Nowadays, researchers are following to think that the term effective leadership is now based solely about the interaction between leaders, staff, parents and agencies on the outside and also the emotional competencies between this (Jones & Pound, 2008).

Effective Leadership
Effective Leadership

Organisation is an important aspect of being a leader or a manager in a setting and this is because everything can be at hand. Practitioners that have a system in place for how they organize paperwork make it easier for inspections, to call people when in emergencies and also to look at different requirements for the children, for example, food requirements (Gabriel, 2005). Having paperwork at hand means that if anything goes wrong or they need to back themselves up by showing inspectorates that they have their filing systems up to date and showing that the staff are qualified up to standard (Gabriel, 2005).

Effective Leadership

A leader needs plenty of skills to be able to both manage and lead a setting. This includes many aspects such as assertiveness. Being assertive without needing to be may put the staff off their work and this may lead to possible retention (Stein-Parbury, 2013). However, being assertive for the right to be heard, valued and respected. Gabriel (2005) found within their research that practitioners were a lot better at being assertive in optimistic situations and this led to staff feeling appreciated and respected themselves. However, most of the research that has been done showed that assertiveness is usually seen in conflict and negative situations (Stein-Parbury, 2013). Furthermore, if an early year’s practitioner spoken to a staff member and told them to do something that they didn’t want to do, they would have to act assertively and also bring in an empathetic tone and let them know how it would help them move up and development (Stein-Parbury, 2013). Similarly, Maravelas (2005) explains that with high assertiveness, staff can become intimidated and undermined. On the other hand, she discusses that there is a low and high assertiveness and the lower toned assertiveness is used less (Maravelas, 2005).

Ofsted highlight the significance of having a strong leader within an early years setting which can influence how they are marked out of good and outstanding operations. The report also states that the visited settings have had few strong leaders who have the ability to self-evaluate and each staff being able to reflect on their own work (OFSTED, 2013). Furthermore, in the inspections, the leaders explain that it is vital to have staffs that are able to interact with the children effectively as it has a profound effect on the children’s development and learning (OFSTED, 2013). Ofsted created a survey that they gave to their ‘strong leaders’ and the findings were that they were inspiration to their staff, they were persuasive and passionate (OFSTED, 2013). Furthermore, the leaders were able to explain to other staff within the setting what strategies could work and why and also how this may be effective for children’s learning and development (OFSTED, 2013). Furthermore, due to the demand of “outstanding” schools and settings, there are many criticisms that OFSTED are facing, such as a member of the think tank explaining that “you’d be better off flipping a coin” and this shows that OFSTED are possibly becoming unreliable due to the amount of inspections that they are facing (Flanagan, 2014). In light of this, the inspections that OFSTED give are reasonable guidelines for schools and other settings. However, staff within a school may become pressured to do everything before the inspection as it is only once a year that it is done (Flanagan, 2014).

Blatchford and Manni (2006) explain that communication is key for all leaders working within a setting. Communication involves many factors, these include: reflecting, empathising, verifying, acknowledging, consulting and listening. Being accessible is vital for communication. Similarly, communication in the work place is vital, working with children involves a lot of communication as the job is pressuring and demanding, Making sure that everyone knows their role is especially important as the leader does not want the staff to make decisions without them and without consent to do so (Moyles, 2006).

In the early months of 2004, the government had dedicated themselves to use the United Conventions on the Rights of the Child (UNCRC). Furthermore, in 2011 the government devised a new law which is called the Rights of Children and Young Persons (Wales) Measure which also helps to confirm that the principles within this are actively used (Welsh Assembly Government, 2012).

There are also policies put in place to make sure settings such as nursery settings, family centres and child-minders have quality standards, such as nappy changing facilities (Welsh Assembly Government, 2012). One of the biggest of the policies is health and safety, Record keeping is also one of the health and safety standards. Records will consist of the parent’s contact details, the child’s health records (if there are allergies), medical administration, and statements on procedures in emergency, records of accidents (Welsh Assembly Government, 2012).

Over more than several years policies and governments have been changing the way they are working, especially with child care. Problems have risen within the past 20 years with mothers having to work and having to pay for childcare. It has been found that working parents pay more than twice as much for childcare than they do for food and bills (Lyus, 1999). Rutter (2015) has also found that 25% of families can afford to pay for full-time child care, whereas the other 45% rely on unreliable sources of care such as relatives, babysitters and friends (Lyus, 1999). In 2015 the family and childcare trust sent out a childcare cost survey and the findings were that parents still have to find the money to fund such necessities. Child care has risen for children under the age of two by 33% by the parliament (Rutter, 2015)

There a several different approaches to define leadership theory, for example the trait approach. Devader and Alliger (1986) established that traits of the personality were intensely related with insights of leadership. Furthermore, Kirkpatrick and Locke (1991) claimed that efficient leaders are diverse types of individuals in several ways. However, Stogdill (1982) had conclusions and his findings were that individuals will not become leaders because of certain personality traits that they have, but because they are able to be a leader in certain situations and then not necessarily be a leader in a different situation. Emotional intelligence is an important factor of our leadership skills; Devader and Alliger (1986) suggests that emotional intelligence entails two competencies which are personal and social. These include self-awareness, confidence and motivation (Northouse, 2010). However, the trait approach has several recognizable positives and has been researched for a century with theorists to back it up; secondly this approach shows what type of personality would fit a leadership role (Northouse, 2010). Nevertheless, the trait approach also has several weaknesses which could be critical, firstly it doesn’t state a definite depiction of the approaches needed to become a leader (Northouse, 2010). Furthermore, Stogdill (1982) implies that it is problematic to separate traits when there has been no insight to situational factors which is equally important as the leader might not lead in certain situations.

Since leadership has become wide spread within settings raising achievement in children, this is called shared / distributed leadership. This term is where a team within a setting are all active leaders other than the head leader (Lindon & Lindon 2011). Other team members have a role to play and it is their responsibility and feeling as they are capable to act as a leader in their own enjoyment (Lindon & Lindon, 2011). Distributed leadership is a well-known democratic theory, also in the category for ‘transformational leadership’ (Rodd, 2006), Moreover, this kind of effective leadership focuses on practice rather than delegation based on an individual’s expertise and encourages staff and practitioners to excel further and motivate them to work harder towards their goals (Rodd, 2006).

Lindon and Lindon (2011) explain that there are many misconceptions of the term and can be problematic within a setting. Distributed and shared leadership have separate meanings, the difference is that shared is that the leader delegates different roles to practitioners (Rodd, 2006). This would lead to effective partnerships within the work place, especially communicating with each other. Communicating is important when being a distributed leader and being able to listen to views of others, understanding and empathising with them (Williams and McInnes, 2005). Listening means providing individuals with their time and privacy and may require constant appraisal so that the staff feel invaluable (Williams and McInnes, 2005). Entrusting staff may be problematic, but with plenty of team working and outings, this may be reduced over time and staff time needs to be used efficiently (Williams and McInnes, 2005).

An example of shared/distributed leadership is family centres, such as sure start family centres. Becoming a leader within a family centre involves the ethic of care and sustaining caring relationships (Blatchford, 2006). Family centres involve multi-agency teams which consist of professionals within health care systems and supporting parents and children holistically. With extensive research in to ‘Sure Start’ family centres there have been many noted challenges. The challenges consist of: maintaining high quality services, leading through change, maintaining morale and motivation, increasing vulnerability, managing outside agencies (Rodd, 2006). Furthermore, family centres need staff that are able to form strong relationships by partnering with children, staff, parents and multi-agencies (Rodd, 2006).

There are many successes in working with multi-agencies, however there are also challenges. The children’s act (2004) brought out a plan to improve children and family services and emphasized the importance of integrated teams of educational professionals, health professions, social workers, job advisers and support for vulnerable parents and young people (Aubrey, 2011). Since the Every Child Matters Green Paper (2003) was devised because of the Victoria Climbie died from negligence and reports were made that on 12 occasions integrated services could have been able to help. This Green Paper is also along with the Children Act 2004. Every Child Matters (2003) discuss that ‘integrated working focuses on encouraging and enabling all professionals to work together and to have common visions which they can deliver, building around the needs of the individual children’. The professionals involved in working in a multi-disciplinary team could be:

  • Police
  • School teacher
  • Early Years Practitioner
  • Midwife
  • GP
  • Social Worker
  • Speech and language therapist
  • Health Visitor
  • Educational psychologist

There are several key aspects of working with other professions, such as having an early intervention before problems become more of an emergency; The CAF which is Common Assessment Framework and is also consent based (NDNA, 2007). Furthermore, multi-agency working also involves record keeping, sharing information to the right people, working with the family and the leader (NDNA, 2007). There are also policies and legislation supporting multi-agency working such as EPPE Report (2003), local safeguarding children board (LSCB) and Children’s Act (2004-06).These legislations have strengthened the meaning of multi-agency working bringing all professionals together in sight of the child (NDNA, 2007). However, there are many potential barriers for integrating professions which can be parental consent. Parents can often feel judged and pressured by certain individuals. In comparison, Aubrey (2011) explain further that with a code of ethics within the setting and moving forward with strategies such as developing a mutual respect and trust, support the continuing development of the parents’ skills and help to develop them further. Furthermore, other publications such as the DCELLS (2005) explain that the challenges could include recruitment. Recruitment can be vital in a centre with such professionals due to new talent, and this could show more of a diverse work-force.

Methods of communication are also important within the early year’s sector with staff. For example, communicating face to face now and again is essential and gives the member of staff time to feel listened to and a valued member (Daly & Byres, 2009). However, Lussier and Achua (2015) explain that communicating one on one could also have negative effects from being unable to record informal discussions and make other team members worried that they haven’t been in a meeting and therefore they may feel less valued. Group meetings are also an easy form of communicating; this would consist of staff being able to make their opinions known and to share views on certain aspects. Employee handbooks can also be an official way of communicating with the leader and other staff, this could be important when a job role has changed (Daly & Byres, 2009) However, this could also have a negative effect as all written information needs to be up to date and this could apply with the National Minimum Standards (Daly & Byres, 2009).

Parents are as much a part of their child’s education as the practitioners and Bowlby (1969) stated that parents are the child’s first source of learning and need to be in close contact with the work that is provided to the children (Daly and Byres, 2009). In successfully managed settings, the leader will have to keep the parents up to date and communicate about the development of their child. Parents being able to feel welcome, valuable and able to trust the practitioners are a key aspect (OFSTED, 2013). Childcare providers can assure the parents that the information that they give them about the child is with them and that they will take care of every child’s needs (OFSTED 2013). It is important that parents feel that they can confide in the manager/practitioner so that they can give them the information that they need and so they can be used to organise activities for particular needs (OFSTED, 2013). There are many ways of keeping parents frequently updated on the development of their children. For example, there are systematic approaches which enable the parents to be updated every six weeks. The ways that communication can be easier for parents/practitioners are regular text messages through mobile phones, emailing via the internet and also the settings website page (OFSTED, 2013). However, systematic approaches to the means of communication can also be hard due to parents having lack of technology to enable them to contact the settings (Bryant & Oliver, 2009). In sight of challenges, many parents feel as though they are being judged by their children’s practitioners and back away from having face to face contact with them weekly (Moyles, 2006).

Challenges that are faced within the workplace need to be underpinned by the leader for some form of conflict resolution. For a good leader, being able to notice staff that are not getting on for some reason should be easy, however sometimes this may be challenging as staff do not want to go through problems that they are facing (Moyles, 2006). There many general ways of how a conflict is, competition, accommodation, avoidance, collaboration and compromise (Rodd, 2006). Leaders with a certain amount of emotional intelligence will be able to understand strategies how to resolve conflicts between staff members. Generally, solving problems such as conflict are able to gather information and evidence to what has possibly happened, and after the time it has taken to get the information, they may get staff in separately and speak to them (Rodd, 2006). However, Sadek and Sadek (2004) explains that many colleagues suffer from conflicts between each other now and again and this may hinder their ability to be efficient to children or other adults within the setting.

ACAS (2015) provide conflict resolution for managers and leaders to show them effective ways of problem solving through times like this. ACAS (2015) also offer information and case studies for leaders and managers to help them with these possible challenges. The government sees wider benefits to improve ‘leader and employee relationships’ which will lead to the ‘high trust relationships’. They have come up with a method of how to manage and avoid conflict within the workplace. Developing strategies which may help manage conflict before it may become a problem is essential within the workplace, such as developing handbooks for staff before they enter the place of work (ACAS, 2014). A democratic leader would be needed in such situations, as this would be an empathetic situation in many cases and they will not presume the problem, they are able to communicate informally (ACAS, 2015). The steps which can be taken are 1. Informally asking an individual to come and talk to you about the problem. Furthermore, if the informal stage isn’t as effective as it is needed then the issue would need to be investigated informally. 3. If stage 2 doesn’t work, then internal procedures need to be used (ACAS, 2015). Finally, making diagrams which could also be designated to the staffroom wall could be used for staff to understand policies and procedures which may be used when a conflict arises (ACAS, 2015). Adults need as much support during team building exercises as much as children need help when they have conflict with peers. Team building is vital within any daily job or setting as colleagues need to get to know each other and get to know how to work together on a daily basis (Williams and McInnes, 2005).

To conclude, this discussion shows leadership in positive and difficult situations. Distributed leadership is seen as one of the most important factors of a setting and partnerships with parents are also significant. The organisation ACAS (2015) has given leaders and managers information and procedures on many challenges that will be faced through working with parents, staff and children. Overall, the most efficient style is Goleman’s visionary leadership, where all staff are aimed towards the same outcome and goal.

References

ACAS (2015) Mediation and Early Resolution.

ACAS (2015) Conflict Management.

Alanazi, T & Rasli, A. (2013) ‘Overview of Path-Goal Leadership Theory. Journal of leadership. London: ED Publications.

Aubrey, C. (2011) Leading and Managing in the Early Years. 2nd ed. London: SAGE Publications Ltd.

Bonnici, C. (2011) A Successful Leadership Style. Lanham: Rowman & Littlefield Education.

Bryant, J. & Oliver, M. (2009) Media Effects. New York: Routledge.

Burnes, B. (2004) Kurt Lewin And The Planned Approach To Change: A Re-Appraisal. Journal of Management Studies.

Burns, J. (2010) Leadership. London: Harper Perennial Modern Classics. 33-56.

Bennis, W & Nanus, B. (2003) Leaders: Strategies for Taking Charge. London.: Harper Business.

Blatchford, I, and Manni (2006) Effective Leadership in the Early Years Sector (ELEYS) Study – Research Report, London: Institute of Education, University of London/General Teaching Council for England.

Daly, M. & Byres, E (2009) Early Years Management in Practice. Harlow: Heinmann.

Davies, B. & Burnham, A (2003) The Handbook of Educational Leadership and Management. London: Pearson Education.

Department for Education (DfE) (2010) Working together to Safeguard Children: A guide to interagency working to safeguard and promote the welfare of children [London]: Department for Education (DfE).

Devader and Alliger (1986) A meta-analysis of the relation between personality traits and leadership perceptions: An application of validity generalization procedures. Journal of Applied Psychology.

DfES (2005) Children’s Workforce Strategy:A Strategy to build a world class work force for children and young people.

Dunlop, A. (2008). A Literature Review on Effective Leadership in the Early Years.

Every Child Matters (2003) The Stationery Office, Effective Leadership. Norwich.

Family and Childcare Trust. (2015) Frustrated Parents Take To Parliament To Demand Answers On Childcare.

Flanagan, P. (2014) Ofsted Inspections: ‘You’d Be Better Off Flipping A Coin’.

Gabriel, G. (2005) How To Thrive As A Teacher Leader. Alexandria, Va.: Association for Supervision, Effective Leadership and Curriculum Development.

Gregoire, M & Adrent, S. (2004) Effective Leadership: Reflections over the past 100 years. Journal of the American Dietetic Association. 103

Johnston, J. & Williams, L. (2012) Early Childhood Studies. England – Pearson Longman.

Jones, C & Pound, L (2008) Effective Leadership And Management In The Early Years: From Principles To Practice. London: Open University Press.

Kirkpatrick, S & Locke, E. (1991) Effective Leadership: Do Traits Matter?. Academy of Management. 5 (2), 48-60.

Khasawneh, A & Futa, M. (2013) The Impact of Effective Leadership Styles Used by the Academic Staff in the Jordanian Public Universities on Modifying Students’ Behavior: A Field Study in the Northern Region of Jordan . International Journal of Business and Management. 8

Lindon, J. & Lindon, L. (2011) Effective Leadership and Early Years Professionalism: Linking Theory to Practice: London: Hodder Education.

Lussier, R. & Achua, C. (2015) Effective Leadership: Theory, Application, & Skill Development. 6th

Lyus, V. (1999) Management in the Early Years. London: Nelson Thornes.

Maravelas, A. (2005) How To Reduce Workplace Conflict And Stress. Franklin Lakes, NJ: Career Press.

Mersino, A. (2013) Effective Leadership and Emotional Intelligence For Project Managers. United Kingdom: AMACOM.

Moyles, J. (2006) Effective Leadership and Management in the Early Years. Maidenhead: Open University Press.

Northouse, P. (2010) Effective Leadership. Thousand Oaks: Sage Publications.

OFSTED (2013) Getting it Right.

Rutter, J. (2015) Childcare cost survey 2015.

Rodd, J. (2006) Effective Leadership in Early Childhood. Maidenhead, England: Open University Press.

Sadek, E. & Sadek, J. (2004) Good Practice In Nursery Management. Cheltenham: Stanley Thornes.

Sashkin, M & Sashkin, M (2003) Leadership That Matters: The Critical Factors for Making a Difference in People’s Lives and Organizations’ Success. London: Berrett-Koehler.

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Leadership Dissertation Topics

Change Management British Airways

Change Management at British Airways

Change Management British Airways – In liquid times (Bauman, 2007), the market is characterized by growing complexity and the capacity to innovate is essential to survival of the firms, as there are more competition. In this context, the traditional factors of production become obsolete fast, and the human resources emerges as the flexible factor that gives dynamism to the firms, been more than a strategic asset , but the competitive advantage (Barney and Wright, 1997) , as it can responds quickly to these changes.

As an important factor of production, human resources must be applied efficiently under the framework of business administration theories and practice, as a controlled and guided process within the firm, known as human resources management.

In the 1970s, the economics structure was being transformed towards the transactions, due the development of the Euro Market and the entering of Oil Dollars. The increase in those financial operations and the development of the Lean Management by Toyota enabled the multiplication of financial services, making the financial markets grow more than the GDP through lending (Schiller, 2008). This led to the abandonment of the Bretton Woods and the oil crisis, disrupting the market. At same time, the developed world faced stagflation and the Keynesian policies were de-legitimized towards the neo-liberal ones (Krugman, 2009).

The British Airways, a State owned firm back then, was hit hard by the oil crisis which increased its operational costs. Notwithstanding, the recession lived by the United Kingdom were paired with a rigid management system, making the firm lose market share and revenue. A cultural shift was proposed in the 1980s, transforming the company, which became the world leader of the aviation market in just one decade and a paradigm both of the cultural change and the change management of strategies. For that reason, it was the elected case to present the present Report, where it will be analyzed the cultural change, the management of change strategy and the consequently performance of the firm.

British Airways Human Resources in Practice: towards the flexibility of Human Resources Management through the cultural shift

In 1983 British Airlines was losing almost 140 millions per year and the saying of the time defined it as “Bloody Awful” . Few years earlier, in 1980, a survey conducted by the International Passenger Association put the BA as the wort airliner carrier. The culture of the company was internally driven, as demonstrated by one of its seniors managers which said in 1984 that they could run a good airliner if it werent for the passengers. The uncertain environment was completed with the privatization which would be carried during the 1980s (Carleton and Lindenberry. 2004).

In this unstable environment, a new CEO assumed in 1983, aiming to recover the company. Its most relevant decision was the transformation of the culture of the BA, which would not be in the “transportation business” but in the customer services market, re-orienting it towards the external driven framework. This change management would allow to focus in the client and provide a quick response to the markets needs, as the customer became the center of the management policies. Although, the company faced the challenge to re-adapt the thinking of 50,000 employees towards this new values, changing their concepts about the BA, their jobs and objectives, essential to align the operational aspect of the HRM (group) to the intangible (culture), keeping the organizational processes coherent ( Schein, 2013).

The change of culture at British Airways aimed to transform the organization towards the customer, with costs and benefits approach, from a profit perspective. The leadership role was relevant, as the CEO was present in all operational processes, from the flying crew to the sessions of the program Managing People First (Turnbull et al, 2001), though, the most relevant changes in the culture, in the period from 1983 to 1995, were, the following:

  • Putting People First (1983) –It was aligned to the culture change towards the externally driven company, consisting in the mandatory of attendance to all staff members of the BA worldwide. The CEO, Colin Marshall, was present in more than 9 in 10 of those events, aiming to describe his vision of the new company structure to the staff.
  • A Day In The Life (1984) – BA had a rigid management style, where hierarchy was one of the core values. The Day in the Life program was a one day training which were mandatory to all the staff worldwide, aiming to improve the communications among the sectors, by familiarizing the staff with other departments. The objective was to create empathy towards the others employees and customers in general, by the accountability of the staff.
  • Terminal Supervisor Development Program (1984-1985)– It consisted of a thirteen-day residence program directed to all the supervisors of the company´s terminals, as the new customer centric approach required all supervisors working in the provision of customers services to the re-trained. The program required also that supervisors who wished to keep their positions after the training program, to re-apply to their jobs.
  • Managing People First (1984-1990)– It was a five program developed for the training of all managers worldwide in the executive levels, in terms of the leadership organizational behavior. The managers reviwed their careers and were encouraged to develop acting lines to adapt their behavior in the new cultural approach.
  • Performance Appraisal (1985) – As the company was changing, with new jobs and management practices, the performance appraisal estabilized the cultural change, which still needed to be defined through the practice. The performance appraisal, thus, became important in embedd and evalue and new culture adoption, as the bonus was tied to the use of the new organizational values within the company.

The change management processes, through the culture defined by the CEO Colin Marshall was continued by the appointed CEO in 1985, Robert Ayling, which proposed the following:

  • Customer Service Leadership Programs (1988-1989) – Creation of a brand through the five class services,aiming to attend the customer´s demand through extensive market research. The program was developed in 5 days, destined to the ground management staff which added value to the customer, to all ground managers worldwide.
  • Winning For Customers (1990) – It was a one day program destined to all the staff to reiterate the cultural shift towards the customer satisfaction, using computer-based simulations of different customer consumption behaviors (British Airways Report, 2010).

Attained Results and the impact of the culture in the Change Management British Airways

The BA Change Management applied into practice the organizational culture from the behaviorist theory, adding a fluidity approach, in terms of flexibility. The HR organizational project aims to model the right behavior to the company, and is particularly focused on ensuring that behaviors to support the change on direction of the customer attention are embedded throughout the organization.

Change Management British Airways
Change Management British Airways

Although, as the Organizational Behavior, traditionally, divides organizational mechanisms as the structure and the culture, and, group mechanisms as leadership behavior and team functioning, for a result to be achieved, there is need to coordinate organizational mechanism with group mechanisms, as they are interdependent, one being the object and the second being the action. Notwithstanding the perceived change was at the cultural level, the leadership was reinforced and emphasized in the Change Management strategy, aiming to direct behaviors through the alignment to the new culture. In this sense, the approach of the BA group can be understood from a systemic perspective, as it conceives both organizational and group mechanisms. The leadership, management training and other programs demonstrates the equilibrium weight between the HRM mechanisms. The culture change was allied to the structural change of the company, which had passed through wage cuts and reformulation of compensations.

As the company determined what it wants to be in terms of culture (results, in the case be more customer oriented), it identified the behaviors it need to follow to attain those results, trained the leaders in the skills needed to achieve those behaviors and rewarded those who achieved, the control of protocols furthered the reaching of the strategy of the culture shift, through a coherent Change Management program, transforming the BA in the most profitable airline company in 1996.

Though, the focus in the culture must be counterbalanced with the other organizational aspects of the firm which were also relevant in the reinvention of the BA in the market (Turnball et al 2001). According to Schein (2013), the real culture, is embedded in the behaviors, values and practices of the group mechanism, being a multidisciplinary approach more proper than the classification of the BA change in terms uniquely or more relevant of the culture. This is because the cultural change supposes a series of inferences which are linked by the behavior of the group according to its values, thus, although companies modifies and creates subcultures in the long run (Avolio, 2011), the leadership and fellowship training programs and strategies, and, the structural change, also were fundamental to enable the cultural shift of the organization, consolidating the BA position in the market in the 1990s. The flexibility and quick response to the markets through the redirection of the firm towards the customer services only were possible because the practices of the company already were being transformed, before the new culture be developed (Tushman et al, 2006).

References

Avolio, B. et al. (2011). An Integrative Process of Leadership. American Psychologist. V. 68, n.6.

Barney, J. and Wright, P. On Becoming a Strategic Partner: The Role of Human Resources in Gaining Competitive Advantage. Cornell University ILR School, 1997.

Bauman, Z (2007). Liquid Times, living in an age of uncertainty. Kindle version book, Paperback.

Carleton, R. and Lineberry, C. (2004). Achieving Post Merger Success: a stakeholder guide to due diligence, assessment and integration. San Francisco: Pfeiffer.

Chomsky, N. (2005) Profit over people: neoliberalism and global order. Seven Stories Press, New York.

Hirsch, A. (1992) Milton Friedman: Economics in Theory and Practice. University of Michigan Press.

Jeffery, R. (2014). What you can learn from Santander.

Maslow, A. (1992) Maslow on Change Management.

Schein, E. (2013). Change Management, Organizational Culture and Leadership. San Francisco: Jossey-Bass.

Schiller, R. (2008) The subprime solution: how today´s global crisis happened and what to do about it. Princeton University Press, Princeton.

Turnball, P. et al (2001). Strategic Choice and Industrial Relations: a case study of British Airways.

Tushman, M. et al (1996). Managing Innovation and Change Management British Airways. London: Sage.

Warner, M. (1994). Japanese Culture, Western Management: Taylorism and Human Resources in Japan. Organization Studies July 1994 vol. 15no. 4 509-533.

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Leadership Skills Effectiveness

Analysis of the American Meltdown Case in Relation to Leadership Skills and Organization Effectiveness

Leadership Skills – The role of leadership in any business environment is very important in ensuring effectiveness of the organization. In business, a leader is important since they define the purpose of the company or organization and lead it to success (Johansen and Kelly, 359). A valuable leader should be one who successfully makes innovations, ensures healthy competition and solves perplexing problems that may be facing the company. However, if a leader does not have the essential leadership skills, then he or she is bound to drive the organization to a downfall. This paper is an analysis of an American company that was affected by economic meltdown of 2008. The analysis will address specific aspects of leadership such as behavior, team processes and organization effectiveness.

Analysis of the economic meltdown of 2008 and how investment firms were affected

The case documented in the frontline website was a video that discussed about one investment bank named Bear Stearns Company. This company acquired huge exposure in 2008 through its dealings on subprime mortgages and other toxic assets (Frontline, 2014). Bear Stearns Company was also involved in trading of stocks and securities and at the same time was also a brokerage firm. In the year 2008, the company experienced one of the biggest failures that were partly caused poor leadership decisions among the country’s top economic experts (Frontline, 2014). This crisis was mainly caused by the housing sector which had invested a lot of money, amounting to trillions of dollars, in toxic mortgages. Most of the housing and investment firms were located on Wall Street including the investment firm, Bear Stearns Company.

During the same time, the company was facing a looming crisis due to the millions of dollars it had invested in bad mortgages and toxic assets. In addition, the company’s stocks had already dropped drastically from 171 dollars per share to a mere 57 dollars (Frontline, 2014). This made the company come into a state of bankruptcy and something had to be done urgently. The Federal Reserve chairperson, Ben Bernanke made a decision that the current crisis had to be taken care of urgently. In order to stabilize the market, Bernanke proposed a merger between Bear Stearns and another commercial bank JP Morgan (Frontline, 2014).

The American government made the decision that they would use thirty billion dollars to cover up the toxic assets and mortgages that Bear Stearns Company had invested heavily. However, this decision was a very dangerous and precarious one that saw many other companies become affected(Frontline, 2014). The economy faced a major meltdown as other investment firms such as Fannie Mac and Freddie Mac became victims of the collapse of giant mortgage companies. In the next few hours, the stock markets crashed completely and credit markets all over the world became frozen. This entire crisis was caused by terrible leadership decisions that were caused by economic leaders and stock market analysts.

Aspects of leadership skills and behavior as portrayed in the economic meltdown video case

Effective leadership is characterized by knowing the right decisions to make on behalf of the company or organization. A successful leader is one who is able to know which decisions can lead to failure and which ones can lead to success (Duygulu and Çıraklar, 391). Leadership entails keeping decisions compatible in light of the needs of the organization. In this case, the economic leaders made decisions that were disastrous to the investment firms and stoke companies located in Wall Street and all over America.

The secretaries of the national treasuries at that time were Henry Paulson and his partner Ben Bernanke. They were responsible for making decisions that were harmful and biased and were not beneficial to the business and economic industry. These leaders decided to bail out Bear Stearns at the expense of the other ones which were later doomed to fail. In addition, these two leaders made the unanimous decision to nationalize three of the county’s largest companies (Frontline, 2014). Moreover, they threatened senior legislators to release seven hundred million dollars or else they would be held responsible for the failing economy. Such leadership behavior can be termed as unacceptable since these two leaders took advantage of their power to manipulate other people.

A good leader must be able to socially integrate and envision the success of his company even in the wake of a looming crisis. He or she should not allow the prevailing situation to become a tempting factor to make him make an impromptu decision on behalf of the company (Duygulu and Çıraklar, 391). Leadership is much more than just a mere function and requires several positive traits such as competent behavior, self-sacrifice, integrity and performance oriented. These skills are crucial in ensuring that the organization runs effectively and that each member of the team is able to fulfill their obligations (Duygulu and Çıraklar, 391). When these traits are demonstrated and portrayed the daily business scenario, then success is bound to follow.

Leadership Skills
Leadership Skills

An efficient leader is one who is able to create a following that will listen and emulate them without any obligation at all. In this case, there was an economic meltdown that began by affecting the housing industry where people who had taken mortgages were at the highest risk. After rumors were released into the public that even investment firms and banks would be affected next, people decided to withdraw their stock shares from whichever companies they had invested (Frontline, 2014).

The leaders of the banks and investment firms had made wrong decisions that resulted in the collapse of their businesses. These leaders went ahead to make investment decisions that they knew would seriously affect the performance of the business. It is true to state that these leaders did not have the sufficient personal competence or attributes to make wise decisions on behalf of the company. The style of leadership must match the expectations and number of followers (Johansen and Kelly, 361). This means that leadership is not only a function of the leader but also of the people who are being led.

The economic leaders, bank managers and heads of the investment firms were responsible of leading a very large number of people (Johansen and Kelly, 361). This people looked up to them to make informed decisions that would be profitable and beneficial at the same time. It is dangerous when a leader does not put into consideration the plight of the people that he is leading. It is important that leaders should prioritize the concerns of the greater public before they make the final decision (Johansen and Kelly, 361).

The decision that was made by the top economist of the country Paul Krugman was responsible for the destruction of the entire country (Frontline, 2014). The decision that he made was an utter nightmare that any economic or policy maker could not agree to. The leadership skills and behaviors discussed in the documentary were directly related to the effectiveness of the organizations that were affected. Organizational effectiveness is very crucial to the success of the economy of every country or state. This term is used to refer to the strategies and initiatives that promote and encourage the company to realize its full potential. Organizational effectiveness ensures that the company or organization is able to make positive and lasting contributions that primarily target the development of the business (Hirsova et al, 102). Such effectiveness can only be achieved when the overall leaders are strong willed, hardworking and uphold a high level of integrity. To create organization effectiveness, business leaders are advised to focus on engaging and aligning other people into forming a workable team (Hirsova et al, 102). Each person in the company performs a unique role in ensuring that the company achieves its ultimate goal. Therefore, it is the duty of the leader to unite and cluster the employees into strong teams that will deliver success on behalf of the company (Schaubroeck, 1053).

The people’s management systems, their structure and capability must be included in the efforts of ensuring that effectiveness is achieved by the organization. The leaders of Bear Stearns Company did not exhibit any strategic planning in ensuring that the company did not run at a loss. Instead, these leaders chose to invest in a risky business venture that led to serious and damaging consequences. The company invested in mortgage and housing that later became toxic assets to them. In order for the company to be rescued from this hole, the leaders and top managers accepted the offer that the commercial bank JPMorgan was proposing for them. The latter company proposed to merge with them so as to lift them up from the imminent status of bankruptcy that as staring them in the face. Such a decision could be termed as being selfish and imprudent since these leaders were only concerned with what would happen to their lives in case the companies collapsed (Hirsova et al, 102).

These leaders did not put into consideration or think about the consequences that would follow after they made such a hasty decision. The merger of these two companies happened at the expense of the nation’s economy since it required additional funding from the treasury. A leader who has been chosen to serve at the national level is supposed to exhibit strong and robust behavior that is worth emulation since many people look up to him (Hirsova et al, 102). In addition, such leaders are expected to be completely selfless and serve the interest of the people to their complete satisfaction. The frontline documentary was able to show that the leaders in this case were selfish and made hurried decisions that were not beneficial for the company and country’s future at large. They did not exhibit any positive aspects of leadership such as being steady decision makers. Instead, they fall prey to the pressures of the failing company performance that was followed by a much larger disaster of economic meltdown.

These leaders should consider employing some modifications in their leadership skills and behavior that can help them in correcting the mistakes that they had already committed. First, these leaders should try to encompass the leadership qualities that are crucial for every person with the mandate to lead (Hirsova et al, 102). They should realize that being a good leader involves having high integrity, being hardworking and able to make informed decisions. A good leader is also one who studies the prevailing situation whenever a problem arises and sits down to plan the next forward move to make. Furthermore, effective leadership is one where the leader is able to incorporate the needs of employers and members of the organization so that everybody’s needs are met (Hirsova et al, 102).

In conclusion, the frontline documentary was able to highlight the dangers of what can occur when leadership is not effective. This documentary showed the case of what happened when economic and investment leaders made disastrous decisions when they were faced by an economic meltdown. The leaders of Bear Stearns Company decided to merge with JP Morgan Company even when they knew that such a move was terribly wrong. In the end, this decision resulted in a financial crisis where companies collapsed and others became bankrupt. To date, people still refer to this case study in order to learn useful tips on leadership and organizational effectiveness.

Works Cited

Johansen, Morgen, and Kelly LeRoux. “Managerial Networking In Nonprofit Organizations: The Impact Of Networking On Organizational And Advocacy Effectiveness.” Public Administration Review 73.2 (2013): 355-363. Business Leadership Skills Source Complete

Schaubroeck, John M., “Embedding Ethical Leadership Skills Within And Across Organization Levels.” Academy Of Management Journal 55.5 (2012): 1053-1078 Business Source Complete

Duygulu, Ethem, and Nurcan Çıraklar. “Effects Of Leadership Roles On Team Effectiveness Leadership Skills.” Ege Academic Review 9.2 (2009): 389-400

Hirsova, M. Zelena, V., Vachova, L., & Novak, M. (2013) Effective Leadership Skills – can Soft Skills Contribute to the Effectiveness of an Organization? Proceedings of the European Conference on Management, Leadership & Governance, 100-104

Frontline (2014) The Deal to Save Bear Stearns

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McDonald’s Global Business Environment

Global Business Environment Case Study McDonald’s

The Global Business Environment – McDonald’s Corporation is a fast-food international chain restaurant which incorporated on December 21, 1964 (McDonald’s, 2015). This global restaurant today operates and franchises in around 119 countries of the world. Around 4 million employees work for the company in its different restaurants and serve 70 million customers per day (Jhaveri, 2014). According to a latest survey in the year 2014, 17% of the fast food industry in the US is dominated by McDonald’s and it is the largest share in the industry. Yum! Brands (YUM) are the closest competitor with a market share of 11%.

McDonald's Global Business Environment
McDonald’s Global Business Environment

The uniform menu of McDonald’s consist of chicken sandwiches, Big Mac, hamburgers, chic nuggets, wraps, the quarter pounder with cheese, soft drinks, desserts, and other beverages. But as the company is into international business, the menu also includes locally relevant food stuff like the black and white burger in China, gazpacho in Spain, and the Veg Pizza McPuff in India (Jhaveri, 2014). The operations of all the restaurants of McDonald’s are managed by the Company itself or by franchises. The franchises are bounded by conventional franchise agreements and foreign affiliated markets under license agreements. The whole business of McDonald’s is subdivided into geographic segments including Europe, the United States, Asia/Pacific, Africa, and Middle East (McDonald’s, 2015). In addition, it presents Other Countries and Corporate, which includes operations in Canada and Latin America, as well as corporate activities. The multifaceted global environment does not complete without competitors. There are some strong competitors of McDonald’s like Pizza Hut, KFC, Burger King etc. All these competitors possess a long business history, remarkable market share, and a good brand image. To ensure its dominating position in the fast food industry, McDonald’s have to take into consideration the power of its competitors.

Global Business Environment of McDonald’s

Every business organization is strongly affected by its business environment. In case of global business, the analysis is usually done for the global business environment. McDonald’s is a big name in the fast food industry and thus the business sometimes gets swayed by the prevailing internal and external environment. There are several diversified tools and methods to analyze the business environment, but in case of global business the most appropriate tool is PESTLE analysis (Bruce, 2014). It considers Political, Economic, Social, Technological, Environmental, and Legal factors of the organization.

Political

The rules and regulations of the government and the policies of the state always affect the business operations of the organization. The business scenario of McDonald’s is also no different. The laws of every nation influence the business operations of McDonald’s and some of the major issues include food business norms, employee laws, license, and tax issues. The franchise business strategy of McDonald’s gets influenced by the foreign investment policies and local government policies as well.

Economic

One of the vital issues of majority of business organizations is the economic factor. Primarily, most of the organizations try their level best not to get affected by the ongoing global fiscal crisis. In different countries of the world, McDonald’s generally faces diversified kinds of revenue measurements and taxes. Owing to the fluctuations in the international currency, the company has to face tough times dealing with economic balance. Not only global, but local economic condition also affects the business operations of McDonald’s.

Social

There has been lot of transformations in the living style of people and all these transformed demands affect the business operations of McDonald’s. Customers ask for highest quality service with all the modern facilities. Furthermore, transformations in the demands of the customers vary from nation to nation and from religion to religion. So, in order to fulfill the demands of the customers, McDonald’s has thoroughly researched the market and provided effectual food menu to all its customers.

Technological

To meet the expectations of the customers, the impact of technological advancements is also considered these days. Also, to sustain successfully in the competitive market, the company always ensured that adequate and influential technological access must be there to attract more number of customers as compared to its competitors. Some of the advanced and competent technological facilities provided by McDonald’s include customer retaining equipment, speedy and modern distribution channels, quick and easy payment options, wireless internet facility and the company is endeavored to augment more number of facilities within its stores.

Legal

To run smoothly every business operation, following legal rules and regulations is a kind of mandatory task for the company. McDonald’s follow the same by paying taxes, stuff laws, following health and safety rules. The company also food authorization rules in some Muslim countries and care about the perceptions and religious beliefs of the customers. As a giant fast food chain, the company believes that abiding legal laws will intensify their public image.

Environmental

In some past incidents, McDonald’s has faced criticism for using non-biodegradable substances for its drinks glasses. Also, some environment activists have targeted the company for using Styrofoam containers for meals and packaging items based on polystyrene. It is seriously discouraged for the greater interest of environment issue.

Conclusion

For the last many years, McDonald’s has become the first choice of especially kids and youngsters as a fast food company. The company has responded very well to the transforming the global business environment and turned out to be a dominating market leader and a pioneer of the Quick Service Restaurant. McDonald’s has efficaciously achieved heights of success in the fast food industry. The company has always given priority to its customer service quality and listened to the choices and preferences of the customers. McDonald’s as a renowned brand has already offered and kept the company ‘ahead of the game’ in the ever-escalating competitive business industry.

References

Bruce Horovitz (May 18, 2014). “McDonald’s testing seasoned fries” The Global Business Environment USA Today

Jhaveri, Amit. 2014. Must-know: A Company Overview of McDonald’s and The Global Business Environment

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Cross-Cultural Communication

The Importance of Effective Cross-Cultural Communication in Business Today

Currently, globalization of business, international expansion of market and rising competitiveness has increased the interdependence of business. With the expansion of business into multiple countries, sensitivity towards the cultural differences has also augmented in the corporate environment. Global interdependence of economy has forced the business owners to provide ample opportunities of cross cultural communication to their managers. It would help in gaining skills and expertise in handling the problems of cultural differences in their organizations (Okoro, 2013). Moreover the international expansion strategies partnership arrangements like mergers, acquisitions and strategic alliances has augmented the importance of effective cross cultural communication in the business world. In highly competitive market and international scope of business, communication is considered to be the vital function in the success of business. Organizational profitability is evaluated by its communication strategies. Cultural barriers have played significant role in hindering the success process of communication in international businesses. Communication process between culturally different people has unleashed the issues of language, values, ways of thinking and religion. Mishandling of these issues would increase the chances of miscommunication (Guang & Trotter, 2012). The objective of this essay is to explain the reasons behind the importance of cross cultural communication which is followed by the explanation of problems and issues hampering the effective communication system. It would also provide the strategic approaches employed by companies to resolve the issues. In the end, organization successfully handling the cultural problems will be compared with the organization failed to cope with the problems of cross-cultural communication.

Various sources have consulted to explain the reasons that why cross cultural communication has become highly important in business today. Literature explained that high pace of globalization has made the cross cultural communication inevitable for businesses. Homogenization of markets has faded the distinctions of national markets. Along with the business development cultural differences between nations, regions and ethnic groups have become stronger. In this situation solution to overcome the cultural problems are presented to smooth the process of communication and interaction between business partners, companies, customers and coworkers (Tian & Borges, 2011). Advertising messages also hold the values, norms and cultural characteristics of different regions. Realizing the importance of cultural factors in advertising messages is very practically and financially very important for business communication As product sales are largely dependent on these advertising messages (Guang & Trotter, 2012).. Cultural values also affect the process of business negotiations and decision making process. In partnership agreements and business transactions business representatives from different countries different cultures has increased the importance of effective cross cultural communication in businesses (Peleckis, 2013) . Moreover, in multinational organizations culturally different workforce has increased the importance of effective communication for successful business operations. Management training programs are organized globally to deal with the issues of workforce diversity. These cross cultural differences have changed the organizational culture. Management styles, communication systems and motivational strategies in the organizations are modified and transformed to ensure the success of organizations (Arseculeratne & Yazdanifard, 2013).

Business students and businesses should be aware of the numerous issues regarding the importance of cross-cultural communication in business productivity and goal achievement. Three of the issues or problems are workforce diversity, cultural impact on advertising and business negotiations. Different management styles of culturally different managers and employees are one of the major issues hindering the productivity and business goals of businesses. It enhances the likelihood of miscommunication, misrepresentation and misunderstanding between the managers and employees. This miscommunication because of different national cultures and ethnic backgrounds affect the operations and productivity of the businesses. Increased emphasis on workforce diversity has made the communication system from culturally different people highly difficult (Okoro, 2013). Another issue rose by culture difference is marketing and advertising of business products and services. Culture differences affect the effectiveness of advertising messages in business environment. Different languages, different buying habits, and consumption styles of consumers from different cultures influence the marketing decisions and business decision of organizations. Moreover, market entering strategies of business are also affected by the purchase behaviors and consumptions styles of target market (Guang & Trotter, 2012). Cultural differences at organizational level affect the business negotiations, partnership agreements and strategic alliances in the global economy. In process of business negotiations, different cultures, different regions and different ethnic backgrounds largely influence the business transactions and partnership agreements. Mishandling of cultural issue and cultural insensitivity would lead to deadlock in negotiation process. In a negotiation process, representatives of high-context culture and low context culture would hamper the harmony of business transactions (Mengyu & Li, 2013).

Businesses can apply a range of strategies or approaches to overcome cross-cultural communication problems. Three strategies required by the organizations to handle these cultural problems in business environment are training sessions, cross cultural programs and enculturation strategies to equip management with the proper understanding of cultural differences. In order to resolve the problem of workforce diversity and develop mutually beneficial relationship between the employees, organizations and management organize training sessions. These training sessions would help in enhancing the managerial proficiency and operational effectiveness of organizations. Training would help in enhancing the cultural sensitivity of managers which ensure the effective intercultural communication (Okoro, 2013). Intercultural programs organized by the management would help to overcome the cultural differences of workforce. Successful implementation of these strategies would help to develop strong competitive advantage (Okoro, 2012).

Cross-Cultural Communication
Cross-Cultural Communication

Understanding of cultural differences and incorporating these cultural aspects in the advertising messages would help in smoothing the process of business communication between customer and the company. Representation of cultural values and cultural norms in the marketing messages would boost the products sales of the company. Moreover training provided to marketing representatives would help in realizing the importance of cultural factors in their marketing campaigns. These systematic strategies to smooth-line the communication system between company and customer help in increasing the profitability of businesses (Guang & Trotter, 2012). To enhance the effectiveness of international negotiations, managers and business representatives should be properly prepared to adapt according to cultural diversity. Enculturation strategies in the management and business representatives would help to ensure the success of international negotiations in partnership agreements. International managers should be properly educated and furnished with proper knowledge and skills to handle the culturally complex situations in business negotiations (Okoro, 2013).

Cross-Cultural Communication Problems

Many businesses have been successful in dealing with cross-cultural communication problems, while others have not shared this success. Successful organization is Volvo Construction Equipment with its acquisition Samsung Heavy Industry’s division while the company which has completely failed in integrating two diverse cultures is BenQ, a Taiwanese company which acquired Siemens. Reasons behind the successful integration of cultural strategies at post acquisition level in Volvo Construction Equipment helps in ensuring the success of acquisitions. New human resource management policy was implemented which completely changed and modified the formal and informal structures of the combined organization. It provided equal opportunity for both companies culturally different to equally participate in workforce and devise organizational structure. Variety of in house training programs and career development programs has equipped the Korean employees of Samsung Heavy Industry with necessary skills and competencies. It helped them to progress in combined organization at higher levels in the hierarchy. Increased stress on the team work facilitated in integrating strengths, concepts and skills of two different cultures (Lee et al., 2014). International education programs at education level enhanced the cultural sensitivity and positive results of these programs exhibited that it enhanced the quality, experience and adaptability towards different cultures (Brydon & Liddell, 2012). BenQ failed to integrate two culturally different organizations because of inefficient allocation of time and resources for integrating and assimilating the culturally diverse organizations. Ineffective communication system, absence of clearly defined objectives and performance expectations lead to the failure BenQ after acquiring Siemens (Cheng & Seeger, 2012).

In conclusion, homogenization of markets, globalization of businesses and increased workforce diversity has augmented the importance of effective cross cultural communication in business world. Increased cultural integration has emerged the issues of workforce diversity in employees and cultural effect on advertising and negotiation processes. Different cultural norms, values and different ethnic backgrounds have increased the problems of miscommunication, misrepresentation and misunderstandings. It affects the profitability, productivity and operational effectiveness of the businesses. These problems of cultural miscommunication could be handled by training programs, cross cultural education programs and introduction of enculturation strategies in the corporate environment. It would help in understanding and realizing the importance of cultural differences to ensure the success of advertising messages, business negotiations and business transactions. Volvo Construction Equipment successfully integrated the culturally different organizations by introducing new human resource management policies. While in comparison BenQ failed to integrate two culturally different organizations because of inefficient allocation of time and resources for integrating and assimilating the culturally diverse organizations. In my opinion, development in international business and global trade importance of cross cultural communication has increased. To fully capitalize on the benefits of international markets and diverse workforce, business organizations need to devise comprehensive strategies of cultural education. Cultural educations programs, in-house trainings would enhance the cultural adaptability of employees and ensure the integration of culturally different organizations in mergers and acquisitions.

References

Arseculeratne, D. & Yazdanifard, R., 2013. Barriers to Cross Cultural Communication and the steps needed to be taken for a MNC to Succeed in the Global Market.

Brydon, K. & Liddell, M., 2012. Supporting international students undertaking Australian university studies. Social Work Education , 31(8), pp.995-1011.

Cheng, S.S. & Seeger, M.W., 2012. Cultural Differences and Communication Issues in International Mergers and Acquisitions: A Case Study of BenQ Debacle. International Journal of Business & Social Science, 3(3), pp.116-27.

Guang, T. & Trotter, D., 2012. Key issues in cross-cultural business communication: Anthropological approaches to international business. African Journal of Business Management , 6(22), pp. 6456-6464.

Lee, S.-J., Kim, J. & Park, B.I., 2014. Culture clashes in cross-border mergers and acquisitions: A case study of Sweden’s Volvo and South Korea’s Samsung. International Business Review.

Mengyu, P. & Li, C., 2013. Research on the Effects of Culture Differences on Business Communication Between China and U.S.- ACase Study of Cross-cultural Management of Joint Venture Enterprise in China. Universal Journal of Management and Social Sciences, 3(9), pp.45-50.

Okoro, E., 2012. Cross-cultural etiquette and communication in global business: Toward a strategic framework for managing corporate expansion. International Journal of Business and Management , 7(16), pp.130-38.

Okoro, E., 2013. International Organizations and Operations: An Analysis of Cross-Cultural Communication Effectiveness and Management Orientation. Journal of Business & Management (COES&RJ-JBM), 1(1).

Peleckis, K., 2013. International Business Negotiations: Culture, Dimensions, Context. International Journal of Business, Humanities and Technology, Lituânia.

Tian, K. & Borges, L., 2011. Cross-cultural issues in marketing communications: An anthropological perspective of international business. International Journal of China Marketing, 2(1), pp.110-26.

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