The essay compares and contrasts the leadership styles and management of two very different companies. The first organisation is Tesco Plc, which is one of the biggest retailers in UK and a highly profitable organisation. The second organisation which was chosen was the charity organisation British Red Cross. Interviews and observations were undertaken at both sites, in order to understand and gather data about the ways in which the leadership styles and management practices differed at each organisation. This essay has been structured in the following manner. The first section examines the leadership styles and management practices at Tesco. This is followed by an examination of the practices at British Red Cross. The conclusion then compares and contrasts the two leadership styles, summing up that the styles need to be different in accordance with the nature and needs of each organisation.
1 Organisational Analysis
1.1 Tesco Plc
Tesco is one of the largest companies in the UK, and is currently one of the leading supermarkets (Anchor and Kourilova, 2008, Enders and Jelassi, 2009, Turner and Wilson, 2006). The small Tesco branch in Greenford was chosen, which has one manager and a total of 15 other employees. This branch was chosen due to accessibility. The branch manager was happy to talk for the purposes of this essay, which is one of the defining characteristic of the research choice. The company has a highly flexible style of leadership, which is adaptable to the needs of the organisation, and the ways in which the competitors are dealing with different situations. The importance of the leadership strategies is also considerable as the different stakeholders need to take into account the different ways in which the organisation needs leadership, leading to higher productivity for their employees (Boddy, 2010, Bogler, 2001, Kahai et al., 1997, Ogbonna and Harris, 2000). The leadership style is not only dependent on the organisation’s needs and responses to the different demands, but also on the way in which customers expect the leadership to respond.
In the case of the interviews and observations at Tesco Office in Greenford, one of the main issues highlighted was that the leadership style by senior management was transformational in nature. The organisation and its leaders are looking to compete aggressively with their competitors, and they need to be able to change the ways in which they can deal with the challenges that they face (Eagly et al., 2003, Mandell and Pherwani, 2003). One of the senior Managers, Mr. Daniel was of the view that:
‘We also need to take into account the different ways in which the customers want the organisation to change.’
In the case of Tesco Plc, the competition from other supermarkets is significant, which means that the organisation needs to be highly flexible, and therefore needs to change continuously (Enders and Jelassi, 2009, Turner and Wilson, 2006). The manager at the store was generally happy with a flexible approach to the organisation. The structure at the store was also not highly bureaucratic, with small span of control at the store in Greenford.
The management style and practices at Tesco are also influenced by the industry within which they compete. The organisation needs to ensure that not only are they able to develop and improve their functionality, they are also competitive at all times. In relation to this, one of the roles of the leadership is to ensure that the employees are empowered at all times, and are capable of taking decisions in order to do their jobs properly (Morrison et al., 1997).
For example, a senior manager, Ms Michele was of the view:
‘The main theme at Tesco was empowerment, where the employees were given the appropriate rights in order to develop and understand the best possible strategy decisions for the company, and therefore allowed then to develop a strategic direction which allows the company to increase its flexibility in relation to its competitors.’
Another major observation regarding Tesco was that although the employees were being empowered, the senior management also believes in tight control in the managerial and accounting aspects of the organisation. This particular issue was surprising, as it shows that the senior management is concerned about the costs of the organisation and its employees, as the increase in the competition between the different stakeholders often means that the management has to be more innovative. Another particular issue, which was part of the interview with a HR manager, Mr. David was the following:
‘Increasing attempts by Tesco to automate their different processes, and therefore the workers at the cheapest possible price have been crucial to us. The main assumption of the company is that the human capital can be replaced by the information systems and technologies, and therefore any particular savings can be passed on to the customer, leading to improved and increased sales for the organisation.’
Another issue which was highlighted as part of the observations of Tesco was that change management by the senior management is generally handled in a professional manner. Change management is a constant part of any dynamic organisation, and Tesco is able to improve its change management techniques in an attempt to improve their viability and sustainability in the long run. This is particularly needed whenever there is a need for the different managers to improve the efficacy and effectiveness of the organisation, and also to ensure that the different sectors of the organisation can improve considerably.
1.2 British Red Cross
The British Red Cross is an established voluntary sector organisation, which is one of the leading charities in the world, which was formed in 1870. The British Red Cross Office in Forest Hill was chosen as the research site due to accessibility and the presence of a structure in the office. There were a total of two senior managers working at the office, who were supported by 10 staff and around 25 volunteers. The staff seemed relaxed and generally happy with the working conditions. The organisation is seen as one of the main voluntary organisations, bringing social good for the world through its work within the world. The organisation is one of the main vulnerary organisations in UK, and is responsible for the support of the various emergency response units for the public good (Limericku and Mintalova, 2008, Davidson, 2010, Waikayi et al., 2012). The aim of the organisation is to improve the public health, while also enabling the different regency response units in their response mechanisms for the public at large.
The leadership management of British Red Cross was found to be highly different from the private sector management. One of the main differences was that the leadership was more laid back in their attitude, as they were not challenging the employees significantly. The public sector is also significantly different from the other organisation and would mean that organisations need to increase their efficacy (Diefenbach, 2009, Dorner, 2009, Mutula and Wamukoya, 2009). The organisational structure of the British Red Cross was made in a way which was more in tune with the increase in effectiveness and the continuation of services. With this background the organisation only focuses on the provision of services. In such a case, the efficiency of the workforce is not a large priority for the organisation.
The main difference in the style of the leadership also another significant factor for the organisation. The particular branch was highly bureaucratic in nature, and had a significant power culture which was based on hierarchy and control through authority at the branch. The managers, during interviews were adamant that rules and procedures must be followed by the book, and there seems to be a focus on the needs of the organisation to have a clear hierarchy. British Red Cross leadership style can be categorised as bureaucratic in nature, which only follows the rules and regulations; the main focus of the leadership is on the continuity in services, as the organisation does not want any disruption to its operations. One of the main issues for the organisation is that they need to ensure that all their efforts are rewarded, as the different stakeholders within the organisation are looking to improve the organisation in incremental terms. This perhaps is due to the lack of competition in the country sector and public sector organization, which has a laid back attitude of leadership amongst the managers (Heinrich and Marschke, 2010, Kearney, 2010, Poister, 2010).
For example, Ms Becky was of the view:
‘The organisational structure of the British Red Cross is also significantly different from the other private sector organisations. One of the key issues for the organisation is the focus on the rules and regulations. This has often meant that the organisation has a highly hierarchical structure, where the use of law and regulations are followed strictly.’
This also means that in many cases, such organisations do not give the freedom to the end user, as they find it increasingly impossible to manage the organisation through a bureaucratic structure. The interviewees in British Red Cross were of the view that they were not happy with the current organisational structure, as it was not robust enough for the needs of the organisation, due to the atmosphere in the international aid and other voluntary organisations. The current economic climate often also means that the organisation in unable to respond to the changes in the different environments, and therefore unable to develop a more robust and modern outlook.
Another major problem with the structure and management practices of the British Red Cross was that the management style is no longer feasible in order to get the best employees. Employees want empowerment, as they want to make more and more decisions about their futures. However, the management style of the organisation does not promote this. This often means that the organisation is unable to develop and gather the best possible solution for them as a whole. One of the ways in which the organisation is able to develop the best possible solutions for the future is in the investment in new organisational and managerial practices, which can lead to long term support for the employees, while also increasing the efficacy for the organisation. The organisation also needs to ensure that it has the best possible communication tools, which can be undertaken in a manner which is acceptable to the different stakeholders and can therefore bring long term benefits for both the employees and the organisation.
A number of conclusions can be drawn from this research. The first is that the organisations need to be flexible in their management systems as they need to ensure that the different stakeholder concerns are taken into consideration. This is particularly an important issue for public sector organisations, as they are looking to improve their efficiency in the face of public sector costs in the UK and elsewhere. The increased efficacy of the organization can be passed onto the customer, which can lead to improve customer satisfaction. Another major conclusion of this research is that it appears that a leaner management structure and practice can be helpful to organisations in their quest to change continuously, as they are looking to improve their efficacy. Leaner organisational structures often mean that the organisation has to walk away from the bureaucratic structures and practices, and be more robust in their approach to the different ways of working. Another major issue for the management in a company such as Tesco is the way in which they can deal with competition.
The leadership style has a direct influence on the way in which an organisation may deal with the changes in the organisational environment. The leadership being willing to delegate responsibility and power to subordinates is one of the ways in which a company can make their employees more accountable and responsible, as they are given more flexibility and responsibility in their environment. The ability of the organisation to change according to the situation is also important as it needs to take into account the different ways in which the changes in management style and structure can lead to long term organisational improvements. The long term needs of the organisation can therefore be fulfilled by examining the needs of the organisation, and therefore they can improve the effectiveness and morale of the company, leading to not only better management, but also to wider profitability..
3 List of Question
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Mandell, B. & Pherwani, S. (2003) Relationship between emotional intelligence and transformational leadership style: A gender comparison. Journal of Business and Psychology, 17(3), 387-404.
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