3.2 Managers, Leadership And Decision Making

Question 1

Definition of leadership?

Answer 1

Leadership is The ability to influence and direct people in order to meet the goals of a group.

Question 2

Definition of management?

Answer 2

Management is the process through which company resources are used and decisions made in order to meet the objective of the firm

Question 3

Difference between managers and leaders?

Answer 3

Leaders are the people who inspire and motivate people to meet objectives.

Managers will set objectives and decide how to go about achieving them.

Question 4

What are the main roles of a managers?

Answer 4

-Setting objectives
-Targets to be achieved within a given
time period
-For individuals and teams
-Analysing
-Factors contributing towards
achievement of objectives
-Business performance
-Leading
-Communicating objectives and
directing subordinates to achieving
these goals.
-Motivating subordinates
-Making decisions
-Allocation of resources
-Day to day running of the business
-Reviewing
-Monitoring performance against
objectives
-Taking action as necessary

Question 5

Internal factors influencing style of leadership?

Answer 5

-The expertise and experience of the workforce.
-The skills required for work to be done
-The personal traits of the leader
-The power given to the leader
-The time frame associated with the task to be undertaken.

Question 6

External factors influencing style of leadership?

Answer 6

-The political and legal environment.
-The economic environment
-The social environment
-The technological environment
-Changing nature of the industry

Question 7

5 Types of leadership styles?

Answer 7

-Autocratic (Authoritarian)

-Democratic

-Laissez-faire

-Paternalistic

-Bureaucratic

Question 8

Definition of autocratic?

Answer 8

The leader makes a decision without consultation e.g in the army when quick decisions are required in battle.

Question 9

Definition of Democratic?

Answer 9

The leader consults the team but makes the final decision. E.g a skilled workforce where each team member can make strong contributions.

Question 10

Definition of Laissez-Faire?

Answer 10

The leader allows the team to make decisions. E.g experienced and competent staff given freedom to make decisions themselves.

Question 11

Definition of Paternalistic?

Answer 11

The leader acts in a fatherly way towards the workforce- making decisions based on the needs of the workforce as well as the business e.g often family or smaller organisations with a more caring style of leadership.

Question 12

Definition of Bureaucratic?

Answer 12

Leaders work to rules and regulations, “by the book”, e.g in bureaucratic organisations where the culture is very much led by rules.

Question 13

What are the theories linked to management and leadership styles?

Answer 13

-Tannembaum Schmidt continuum
-Leadership model based on a
spectrum between two extremes of
manager centred and subordinate
centred approaches.
-Recognises that in reality leaders are
unlikely to be at either extreme but
somewhere along the spectrum

-The Blake Mouton Grid
-Leadership based on two
behavioural dimensions of concern
for people or concern for production
which identifies 5 leadership styles.

Question 14

Four categories of leadership based off Tannenbaum Schmidt continuum?

Answer 14

-Sells

-Tells

-Consults

-Participates

Question 15

The approach taken by a manager will vary based on these factors?

Answer 15

-The forces in the manager
-Personality and characteristics
-Experience
-Attitude towards and trust in
subordinates
-The forces in the subordinates
-Personality and characteristics
-Experience
-Attitude towards and trust in leader
-The forces in the situation
-The nature of the problem/
situation
-Resource constraints including time
-The culture of the organisation

Question 16

5 leadership styles based on Blake Mouton grid?

Answer 16

-Impoverished Management
-An impoverished or indifferent
style
-Little concern for people or task
-Management avoid responsibility
and accountability
-Blames others
-Country club management
-An accommodating style
-Motivates and engages by looking
after the needs of employees
-Relaxed atmosphere with no
pressure to meet targets or get
work done
-Social nature of the workplace is
important
-Team management
-A team style
-Managers show high concern for
both people and production
-Treats workers as a core asset
-Achieve productivity goals as a
team
-Authority obedience
-A produce or perish
-Managers want to control and
dominate workers
-Orders must be Followed
-Workers are treated as a resource
like any other
-Organisation man management
-A middle of the road style
-Compromise is made between
concern for people and concern for
production
-May influence corporate objectives
e.g an objective of profit satisficing
over one of profit maximisation

Question 17

The effectiveness of different styles of management and leadership?

Answer 17

-Effectiveness means:
-The ability of a business to achieve
its objective e.g financial
performance, competitive
advantage and social.
-Different styles will be effective in different businesses and situations:
-A laissez faire or subordinate
centred style may work in an
environment where employees are
highly skilled with an objective of
innovation.
-Where quick decisions need to be
made and a situation handled such
as a work place accident or
environment disaster an autocratic
manager centred approach will be
more effective

Question 18

Scientific vs intuition based decisions?

Answer 18

-Scientific: Based on data
-Supported by quantifiable evidence
-Encourages logical thought process
-However:
-May require expensive data
-Time consuming

-Intuition: Based on personal decision
-Allows for quick decision making
-Encourages innovation and creativity
-However:
-Difficult to justify
-Reliant on experience and
expertise

Question 19

Risk and uncertainty?

Answer 19

-Risks
-It is possible to add a probability to
quantify the degree of risk
-It is measurable
-Uncertainties
-It is not possible to add a quantifiable
probability as the outcome is too
unpredictable
-It is not measurable
-Business decision making involves both risk and uncertainties.

Question 20

6 steps of scientific decision making.

Answer 20

-Step 1
-Set Objectives
-Step 2
-Gather Data
-Step 3
-Analyse Data
-Step 4
-Make Decision
-Step 5
-Implement Decision
-Step 6
-Review Decision

Question 21

Influences on decision making.

Answer 21

-Mission
-Does the decision fit in with the
businesses overall purpose?
-Objectives
-Will the decision help the business
achieve its goals within the specified
time period?
-Ethics
-Is the decision morally right? Are the
managers comfortable with the
decision I.e does it meet their own
ethical standards.
-The external environment including competition
-How will changes in the external
environment e.g fluctuations in the
economy or competitors’ actions
influence the financial outcomes and
the probabilities? Will this have a
major impact on uncertainty in
decision making?
-Resource restraints
-Even if a decision looks like the right
one is it achievable with the
resources available, including:
-Time
-Human Resources
-Expertise
-Finance

Question 22

What is a stakeholder?

Answer 22

-A stakeholder is anyone with an interest in the actions of a business.

-These include:
-Customers
-Employees
-Shareholders
-Government
-Community
-Suppliers
-Financial Institutions

Question 23

Stakeholder mapping.

Answer 23

-Low level of interest High power.
-Keep satisfied- Potentially influential
group but with little interest in the
business. It may therefore be
beneficial to consult with them to
Try and increase the level of interest.
-High level of interest High power.
-Manage closely- These are the most
important group of stakeholders
and therefore the business should
seek to involve them in decision
making.
-Low level of interest Low power
-Monitor- Neither powerful or with a
high level of interest if it’s therefore
only necessary to make a minimum
amount of effort with this group.
-High level of interest Low power
-These are likely to be secondary
stakeholders who have a high level
of interest e.g the community but
little power. Involving these
stakeholders and keeping them up
to date with developments can help
build good relations.

Question 24

Influences on the relationship with stakeholders.

Answer 24

-Leadership style

-Mission and objectives including:
-Financial
-Social
-Ethical
-Environment

-Stakeholder power and interest

-Market conditions including competition

-External influences e.g legislation

-Business form

Question 25

Managing the relationship with different stakeholders.

Answer 25

-Communication
-Keep informed
-Two way as well as one way
-Involve third parties e.g trade
unions, pressure groups, experts

-Consultation
-Share proposals and seek opinions
early in the decision making process