Managers use various tools to achieve their organizational goals. One of these tools is the leadership theories. Mr. Johnson founded the “Sweettaste Ltd.” Besides being the owner, he also acted as the manager for several years. His main role was making the business have roots in the market. During this time, he was an autocratic leader. He applied the transactional theory of leadership whose focus is the use of power over the workers. The company grew into a multinational and was now managed by a board of directors. Mr. Johnson became the chairperson of the board with the executive duties being left for the CEO. His main role being chatting the general direction of the organization. He changed his leadership style into a participative leader, extensively using the transformative leadership theory. He used influence to have the directors, managers and other workers work towards achieving the company’s vision. He was effective for the two roles but failed in some circumstances because of his inflexibility.
There are several leadership styles that organizations’ managers use to achieve the goals of their companies. Depending on the role and situation, a leader may adopt a particular form of leadership. The role of a leader may change as dictated by the external business environment or the growth of the business (Lam et al., 2015). Mr. Andrew Johnson is the founder of the “Sweettaste Ltd.” The business started as a small local enterprise producing only one brand of processed fruit juice. The company later grew into a multinational company with production plants in nine countries. Mr. Johnson started as the sole manager of the business. When the business expanded, however, the structure of the management changed. A board of directors was constituted with him as the chair. This paper seeks to evaluate the effectiveness of the leadership styles that Mr. Johnson used in the two capacities and the factors that necessitated the change of leadership.
Leadership theories, styles, and techniques
There are several leadership theories put across by various scholars. According to De Hoogh (2015), none of the approaches is sufficient on itself nor is better than the others. The application of these theories is situational. When Mr. Johnson was a manager, he extensively made use of the transactional theory. This theory believes that leaders in a particular organization should conform to the existing structuring. They should focus more on order and structure. Having entered into a new venture, the manager’s fundamental interest was supervision, organization, and performance. For the business to take roots, there was a need to monitor any deviation and thus enhance consistency. Observance of the structure was therefore paramount. Transactional leadership theory assumes that rewards and penalties are the only motivations for the followers (McCleskey, 2014). This theory is majorly beneficial in achieving short-term targets. Also, it has well-defined rewards and punishments for the employees.
Transactional leadership often give rise to autocratic leaders. The critics of this type of managers claim that autocracy does not provide room for the subordinate employees to give input. As Tyssen et al. (2014) say, there is no suitable environment for creativity among the workers. As a manager, Mr. Johnson used to make almost all the decisions by himself. This undertaking ensured the decision process did not take long. Specific goals were met within a short time. According to De Hoogh et al. (2015), autocracy can be used where a great deal of pressure is required for things to work out or in small organizations where there seems to be no leadership. As an autocratic leader, Mr. Johnson used power to force his employees to perform. The juniors were expected to follow the commands coming from above to the letter. The use of power helped the manager to have the full control of the organization while and maintain discipline among the employees as well.
In relatively new enterprises and large corporations such as multinationals, transactional leadership theory has been seen to be very useful. This theory is, however, best at the implementation stage (Antonakis et al., 2014). Being a chair of the board of directors, Mr. John’s duties changed from execution. He was mostly concerned with policymaking. As a consequence, there was a need for him to change the theory he applied and his leadership style altogether.
After assuming the new role, Mr. Johnson started making use of the transformational leadership theory. This theory puts the interests of the workers above everything else. It focuses more on “leading” rather than “managing” (McCleskey, 2014). The theory has four elements, i.e., intellectual stimulation, idealized influence, inspirational motivation and individualized consideration. Mr. Johnson’s primary duty as a board member was to encourage the other members to be creative. He was never satisfied with the status quo. He always believed that there is always something better that could be done to improve the performance of the company. Transformational leaders ensure that they make use of the talents and unique abilities of the employees. Even with the talents that seemed not to relate to the mission of the company, he identified and appreciated them. Among the directors, for example, he noticed one lady who was good at singing. In every meeting, he would give her a chance to lead in a chorus or two. This simple act of singing together helped to form strong bonds among the directors.
Additionally, in transformational leadership, the followers learn from the ideals of the leader. The leaders offer themselves as role models. Out of respect and trust, the followers will emulate them. Such individuals also carry the vision of the organization. They are passionate towards achieving the overall goals. According to Lam et al. (2015), they will as well endeavor to articulate the vision to the workers so that they develop the same passion and own up the vision. For Mr. Johnson, he developed very open relationships with the board members, including the CEO. This closeness helped him, as the founder, to share his dream for the company with the other directors and top managers. The transformational theory also describes a good leader as the one who treats the employees as individuals and not crowds. He/ she will develop close interpersonal relationships with their followers providing essential links for communication. They will focus on individual motivation for exemplary performers.
Leaders who apply the transformational leadership theory are participative. They focus more on influencing their followers rather than using their power to have things done (Lam et al. (2015). They are keen to ensure that every worker is involved in decision making. In many companies, the board of the directors is almost an abstract thing among the employees. These directors are very distant and seem to only deal with the CEO. With Mr. Johnson, however, the case was different. He made sure that the vision of the company did not remain solely with the top managers. He ensured that the board had regular meetings even with the junior-most managers in the organization. Such forums were vital for him to pass the objectives and dreams of the business to the workers. Also, the employees gave their input on some of the issues affecting the company. The opportunity for the employees to have their opinion heard made them feel part and parcel of the organization and not just laborers.
According to Antonakis and House (2014), participative leadership has got three main advantages, i.e., acceptance, morale, and creativity. It results in faster and easier implementation of new policies and regulations. According to De Hoogh et al. (2015), when the employees are involved in coming up with specific rules, there is likely to be no resistance. They will feel obliged to abide by the organization’s resolutions. The morale of the workers will also improve in a participative leadership. They feel personally liable for the success of the company since they are involved in making critical decisions. Additionally, when a worker is given an opportunity to be part of the decision makers, they are encouraged to be creative. They will explore all the possibilities of improving the working conditions and the organization’s processes. Courtesy of Mr. Johnson’s style of leadership, “Sweettaste Ltd” was doing very well in the market. Having been empowered, the product development managers came up with many and improved brands of drinks. This move saw the company’s sales and overall productivity increase significantly.
Being the senior most manager, the CEO of “Sweettaste Ltd” enjoyed working with the chairperson of the board of directors. He felt valued since most of the recommendations he suggested to the board were accepted and he was given the go-ahead to implement them. Inspired by the chairman, he also became a very participative manager. He nurtured the talents of his juniors. His staffing was excellent. He placed various individuals in different positions depending on their capabilities. He became part of the transformational force within the business. His great achievement was to coordinate the operations of the various regional branches in different countries.
Unlike when he was the manager, Mr. Johnson resorted to using influence as opposed to power. He ensured that he developed behaviors and traits that can be emulated by other people. He no longer commanded. He worked to win the support and trust of his followers. A principal disadvantage of participative leadership, however, is that it slows down the decision making process. Important decisions are made through consensus. It might thus take a long time before an agreement is arrived at. Nevertheless, the delays in decision making are insignificant compared to the richness of the decisions made eventually..
The effectiveness of Mr. Johnson
The effectiveness of Mr. Johnson as a leader can be looked into using the contingency theory. This theory states that the success of an organization or a team is not entirely determined by the type of the leadership style employed. Instead, many situational factors will bring about the success or failure (Fiddler, 2015). These factors include the specific task that the leader is carrying out, the characteristics of the employees under the leader and the organizational goal. Summarily, according to the theory, the organization’s achievements are situational.
According to De Hoogh et al. (2015), managers for young businesses are principally concerned with hiring and staffing, monitoring performance, and monitoring and controlling budgets and expenditure. To accomplish these duties, it requires the leader to use power. Immediate correctional actions are needed at this critical stage of the business in case of deviations. Mr. Johnson successfully employed the transactional theory of leadership in his role of building the foundation for a thriving business. Being a relatively new business, the workers were not adequately familiar with the vision of the company. According to McCleskey (2014), understanding of the organization’s vision is a significant source of motivation for a worker. At this time when the company’s dream was still a blur to the workers, it was necessary for Mr. Johnson to use force to have work done. He managed to improve the productivity of the workforce. In addition, the primary goal of the “Sweettaste Ltd” as a new business was to win itself a good share of the market. Mr. Johnson ensured that the quality of the company’s products was to the right standards. He succeeded in providing the market with reliable and quality drinks.
His behaviors changed with the change of role. His primary role now was to give the general direction of the business by defining the strategy and making policies as a board member. This task cannot be entrusted to an individual. Neither is the board alone enough to develop the mission and the vision of the organization. Mr. Johnson consequently resorted to reaching out to as many stakeholders as possible in making such vital decisions. With time, the workers became conversant with the vision of the company. Mr. Johnson, appreciating the diversity of abilities and realizing the importance of tapping each of the talents for the betterment of the organization, became open to everybody for the exchange of ideas. He started treating every person in the company as a valuable asset. Also, having become a multinational, the primary goals of the business had changed. The business was now more concerned with improving the customer’s experience by its service and business networking. The two goals were only achievable by bringing various stakeholders on-board. It was therefore paramount for Mr. Johnson to change from being a leader of giving directives but instead become more listening. He managed to engage the customers constructively and have many business partners.
Mr. Johnson succeeded in changing his leadership style and techniques after moving from a manager to a chairperson of the board of directors. However, he seemed to use one leadership style for the respective offices purely. In some instances, he failed because of lack of flexibility. If he had this consideration, he could have become more effective. As a leader, it is a good practice, to empower others and especially when you are not an expert in specific areas. Mr. Johnson almost paralyzed the production process during the first years of his company. Wanting to increase the rate of productivity, he ordered some technical changes made in the plant. Even after being advised otherwise, he insisted that the changes had to be made. It was only after production process momentarily collapsed that he changed his mind. With such technical issues, it was essential for him to give room for correction from his juniors.
At one instance also when he was the chairperson of the board of directors, some errors occurred in one of the company’s production plants. Consequently, substandard products were released into the market. The problem was so severe that the government ordered the closure of the plant until an investigation was done and the necessary corrections effected. In an effort to involve all the stakeholders, the plant took six months to reopen. As transformative as he was, at this time an immediate action was required, and autocracy was probably the best leadership. The six months’ closure led to the loss of a lot of revenue. It was not necessary to take that long to solve the problem.
Both the transactional and transformational leadership theories are essential tools for managers. They are situational. The leaders should, therefore, be smart enough to identify when to apply either of them. For Mr. Johnson, he was an effective leader who changed the leadership style with his roles. He, however, failed in some situations. He was not flexible enough to act differently when the circumstances that demanded him to show different leadership came.
Antonakis, J., & House, R. J. (2014). Instrumental leadership: Measurement and extension of transformational–transactional leadership theory. The Leadership Quarterly, 25(4), 746-771.
De Hoogh, A. H., Greer, L. L., & Den Hartog, D. N. (2015). Diabolical dictators or capable commanders? An investigation of the differential effects of autocratic leadership on team performance. The Leadership Quarterly, 26(5), 687-701.
Fiedler, F. R. E. D. (2015). Contingency theory of leadership. Organizational Behavior 1 Essential Theories of Motivation and Leadership, 232, 01-2015.
Lam, C. K., Huang, X., & Chan, S. C. (2015). The threshold effect of participative leadership and the role of leader information sharing. Academy of Management Journal
McCleskey, J. A. (2014). Situational, transformational, and transactional leadership and leadership development. Journal of Business Studies Quarterly, 5(4), 117.
Tyssen, A. K., Wald, A., & Spieth, P. (2014). The challenge of transactional and transformational leadership in projects. International Journal of Project Management
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