Chapter 18- Leadership

Question 1

Manager

Answer 1

Overseas activities, implements company procedures, delegates tasks and organises people. Has a vision to be achieved and develops strategies of how to achieve it.

Question 2

Leader

Answer 2

Someone within an organisation that inspires others – sets goals and creates rules and policies enforced by managers. Leadership can be defined as a skill whereas management is a position in the business’s hierarchy.

Question 3

Autocratic leadership

Answer 3

Someone who makes decisions independently, instructing others of the decision rather than including them in the decision-making process. Autocratic leaders demand obedience and don’t like to delegate power.

Question 4

A/Ds Autocratic leadership

Answer 4

Advantages
-Speed and clarity at which decisions can be made as there is no need to meet and consult with other employees in the organisation.

-Assess a situation and quickly pass a decision. This approach may be invaluable in pressurised environments, such areas of the medical profession or perhaps in certain situations such as a liquidity crisis.

Disadvantages
-Can demoralise those working with an autocratic leader and can lead to poor morale and high labour turnover

-Risk that employees may become dependent on the leader to make decisions and cannot function effectively in their absence

Question 5

Paternalistic leadership

Answer 5

Where the leader is authoritarian and makes decisions without consultation, but factors in the interests and needs of their employees.

Question 6

A/Ds Paternalistic leadership

Answer 6

Advantages
-Higher levels of motivation as employees recognise that their views have been accounted for and more accepting of the decision made.

-Reduced concerns about labour turnover as workers are less likely to leave the organisation.

Disadvantages
-Some decisions may take longer if workers have conflicting demands to the leaders.

Question 7

Democratic leadership

Answer 7

Includes others in the decision-making process through a consultation method to understand workers opinions and reach a decision.

Question 8

A/Ds

Democratic leadership

Answer 8

Advantages
-More motivational as workers may feel more involved in the business and invested in the business and invested in the decisions that are made.

-Better decisions may be reached as subordinates may raise an issue or suggest an idea that the leaders haven’t considered.

Disadvantages
-Relies on the leader possessing good communication skills

-There is the danger that subordinates may resent being consulted if the manager goes on to reach a decision they do not agree with.

Question 9

Laissez-faire leadership

Answer 9

This is when leaders relinquish the role of the decision maker and encourage people in the organisation to make decisions for themselves. This empowers employees to make decisions and exercise judgement rather than looking to the leader to make decisions for them.

Question 10

A/Ds Laissez-faire leadership

Answer 10

Advantages
-Effective in industries where the business has highly qualified and skilled employees who may relish the autonomy and empowerment of a laissez-faire environment such as law and journalism.

-The levels of productivity and intrapreneurship is hard to be replicated by other businesses giving it a competitive advantage.

Disadvantages
-It relies on the leader creating an environment where their subordinates have the resources and support to make decisions for themselves and can be ineffective if such subordinates do not possess these skills.

-Risk that employees may see the lack of supervision they receive as an opportunity to be less productive.

Question 11

Which leadership style is the most effective?

Answer 11

• The most important factor when deciding which leadership style is the most effective is the circumstances that the business finds itself in.
• In a crisis there are significant benefits to autocratic and paternalistic styles of leadership due to their speed and decisive natures.
• In times of hardship between employer and employee (experiencing poor motivation, declining productivity and rising labour turnover,) it may be that a more authoritarian leadership style may exacerbate the situation
• For businesses that need to attract highly trained/skilled employees may use a laissez-faire approach
• In times of poor businesses performance, leadership is often an important factor that may need to be reverted.
• Staff as an asset/ staff as a cost approaches may also be influential.