(Doc) Assignment for Business Leadership

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Running head: BUSINESS LEADERSHIP
BUSINESS LEADERSHIP
Name of student:
Name of university:
Author note:

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BUSINESS LEADERSHIP
Q1.
Ans. Scholars associated with the field of business administration have propounded that it is both
personal traits of the leader as well as the environment of the company. It has been found that
overconfidence among the CEOs is a cause of them becoming irresponsible towards the integrity
of the company. The overconfident attitude of the CEO leads to defective decision-making and
has been envisaged by Chen, that overconfidence is the cause of biasness among the leaders in
the context of information-processing as well as in making erroneous judgement (Aebi, Sabato &
Schmid, 2012). Regarding the ethical framework that guides the company it needs to be kept in
mind that if the agent fails to properly reflect on the situation due to overconfidence that emerges
during the course of making a decision then the agent needs to be held responsible by the board
of governors by keeping checks and balance on the CEO. The board of governors need to ensure
that the CEO is communicated that the overconfident attitude is unethical and it is not in
conjunction with the interest of the company (Sageer, Rafat & Agarwal, 2012). There have been
several studies that have documented the tendency of overconfidence among the CEOs but there
have been few studies that offered solution. Petit and Bollaert (2012) have discussed about the
development of virtue of reverence among the CEOs as a kind of internal mechanism of
prevention. Overconfidence, unscrupulous nature and shirking of duties among the CEOs can be
prevented through the alternation in the corporate culture. The institutional investors and the
board of governors can monitor the attitude and actions of the CEO and restrain any
overconfident attitude. They can further prevent the CEOs from engaging in inappropriate and
unethical decisions through the addition of an external and systematic factor that would impede
the CEOs from acting and executing in an unethical and unscrupulous manner. The agency
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theory underscores that the misaligned interest of the corporate managers provokes them to
maximize their profit through opportunistic behaviour rather than through maximization of the
wealth of the shareholder. Managers have been found to exploit the free cash flow of the
company by resorting to investments that have negative impact on the present value (Riucciuci,
2015). Managers have the tendency to overdbid with the purpose of providing personal benefits
to the mangers rather than for building the empire. Managerial overconfidence and inefficiency
can be demonstrated in the poor investment as managers have been found to overestimate the
investment project returns and thereby there is overinvestment (Park & Chung, 2016).
Institutions, in this case the board of governors need to ensure that that there is effective
monitoring of the overconfident and the unscrupulous CEOS that would prevent them from
making overinvestment. Firms that have higher institutional monitoring system in place report
lower levels of negative outcome from the CEOs. There needs to be the most robust approach to
the institutional ownership through the quarterly ownership. The board of directors need to
ensure that the leader of the organization, in this case the CEO is committed towards establishing
an ethical culture both in the boardroom as well as in the public square. This can be done through
inspiring the CEO (Chief Executive Officer) of the company to engage in CSR (Corporate Social
Responsibility) activities and incorporate it as a part of business practise. The value of CSR need
to be infused into everything and it should not be considered as a standalone discipline.
Q2.
Ans.) Qualities of a high-performing leader- According to the case study, good governance is
concerned with the management of people in an efficient manner. It has been argued that the
leader needs to reflect the traits of confidence, honesty, integrity and accountability that would
inspire the workforce to deliver their best performance. The values and action of the leader is
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found in the workforce and establishes the connection between the business and the society. The
role of the CEO is to develop and execute the company’s long-term strategy with the view of
establishing the shareholder value. The CEO has the responsibility of being performing the day-
to-day tasks and seeking the decisions for the long-term implementation and short-term
implementations of the plan of the company. The key responsibilities of the CEO are to lead the
company and work in conjunction for the development of the strategy of the company. The role
of the CEO is to oversee the implementation of the strategies of the company in accordance with
the business ethics, values and business model of the company. The role of the CEO is to
communicate on behalf of the company to the different stakeholders, employees, shareholders,
government authority and the public. In specific words, the responsibilities and duties of the
CEO is to lead an organization with the help board of directors in the development of the
strategy to be adopted by the company (Hoffman, Casnoch &Yeh, 2013). The duty of the CEO is
to exhibit leadership qualities by ensuring that the company is functioning within the ambit of
law and the expenditures of the company are within the purview of the allotted budget for the
company. A CEO also need to oversee and evaluate the major risks hovering the company and
ensure that the risks are monitored and regulated in an efficient manner. Another responsibility
of the CEO is to ensure that the Company is organized and staffed in a proper manner. A CEO
ensures that employee who are hired would have to terminated easily and is able to accomplish
the approved strategy. A CEO need to ensure that the management information and internal
controls are in the right place. Another responsibility of the CEO is to ensure that the Company
has the adequate system so that it is enable in conducting the activities through ethical and lawful
manner. A CEO needs to ensure that that the company establishes, nurtures and maintains high
standards (García-Morales, Jiménez-Barrionuevo & Gutiérrez-Gutiérrez, 2012). A CEO need to

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BUSINESS LEADERSHIP
ensure that there is high standard of corporate citizenship in the company and there is adherence
to ethical leadership and accomplishment of social responsibility. A CEO needs to act as the
liaison between the Board and the management. Another responsibility of the CEO is to ensure
that the company maintains the integrity of the public disclosure. CEOS need to lead by
example, they are being scrutinized and continuously monitored by different stakeholders all the
time and therefore, the CEOs need to motivated to become exemplary role models especially
during moments of turbulences and crisis. The CEO needs to be transparent and needs to
prepared to answering tough questions as test of his/her integrity that may include ways the CEO
can justify the compensation (Tricker & Tricker, 2015). The CEO needs to be transparent with
the answers and at the same time balance between the objectives. The CEO needs to deliver
consistently through a uniform message about the core value of the company. Another
responsibility of the CEO is to tailor this response according to the composition of the target
audience. A CEO needs to leverage the loyalty of the employees by making them feel that they
belong to the community of the company and motivating them to achieve whatever they want.
By instilling in the employees a sense of loyalty, the CEO can expect the employees to deliver
their best performance. The CEO can set the limit by letting each employee to behave in the way
they feel it is compatible for the purpose of the company. In diverse companies, the employees
should have clear objectives about the functioning of the company and there should be the
provision of specific rules for the determination of behaviour of the employees. The CEO also
needs to think about the goodwill of the customers and therefore, need to utilize the social media
to create communities who will in turn foster the growth of the company. In the age of
digitization social media is the reality and therefore a company needs to leverage the influential
support of the larger community (Yukl, 2013). A CEO needs to ensure that eth directors in a
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BUSINESS LEADERSHIP
company are informed and that adequate information is disseminated to the Board that enables
the directors to consolidate the right judgements. A CEO needs to request for special meetings
with the Board of directors. Finally, the responsibility of the CEO is to adhere by the rules set up
by the authority and internal establishments. In this situation, the leader needs to govern with
personal examples and act in accordance with the applicable laws and the standards and policies
of the company that further includes safety measures, health policy and the environmental
policies
Q3.
Ans.) Leveraging the loyalty of the employees- a leader can leverage the loyalty of the
employees through adoption of the values of global leadership, transformational leadership style,
using the appropriate change management style to bring about a change in the organizational
culture and through teamwork amongst others. In the age of globalization, the essence of
leadership should be global and intercultural. A global leader moves beyond the parameters of
transformational leadership and infuses the values, principles and ethos of diversity and
inclusiveness within the organization (Bolman & Deal, 2017). In the age of inclusiveness and
cultural heterogeneity, a leader who practises ethnocentrism and cultural homogeneity will lead
to the demotivation of the employees and make them feel excluded from the organization. An
organization is composed of people from diverse communities, religious practises, faith and
social backgrounds. Therefore, whilst interacting with the employees a leader needs to keep in
mind that she or he is not dealing with empty vessels but embodied human beings who bring
with them different ideas, beliefs and values that they have inculcated through their life cycle
into the organization. A leader needs to identify those values, respect the diversity and
acknowledge the employees for their contribution. This will instil a sense of confidence and
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BUSINESS LEADERSHIP
goodwill among the employees that will be reflected through performance and loyalty of the
employees. A leader needs to motivate the employees to engage in CSR (Corporate Social
Responsibility) by making the employees more accountable and instilling in them a benevolent
attitude towards the society. A leader needs to recognize the power of the workforce and
therefore value it. Teamwork and team spirit is an important aspect of establishing and
entrenching an effective and powerful organization. A team comprises of a groups who work
with a sense of wee feeling and are aware about their commitment towards the larger goal. The
embers in a team have different roles and responsibilities. Team members are accountable to
each other and during the phase of conflict, they engage in conflict resolution rather than holding
on to their ego. Teamwork indicates staying beside the company during the tough times and
distribution of responsibilities for the smooth functioning of the organization. A leader needs to
incorporate the change management procedures to ensure that the company the employees in the
company remain loyal and can respond to the change in the organization. A bottom-up approach
of change management will be effective in bringing together the employees and receiving their
opinions. Acknowledging the viewpoints of the employees and providing them with the space to
express their opinions would play an instrumental role in the long-time retention of the
employees and prevent attrition rate (Avolio & Yammarino, 2013). Employees should be
provided with bonus,, incentives and rewards to make them feel valued. Employees require
continuous motivation without which they may feel disconnected with the organization.
Transformational leadership is the key to initiating and sustaining long-term employee loyalty.
Transformational leadership has been defined by MacGegor Burns as a kind of leadership
approach that causes transformations in the individuals and thereby in the organizational culture.
A transformational leader is known for creating positive and valuable change within the

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organization and among the followers in advancing the cause of the company through the
creation of collective responsibility among the employees (Antonakis & Day, 2017). Therefore,
the CEO needs to adopt transformational leadership for the intellectual stimulation of the
employees, communicating the vision of the company to the employees and motivating them,
and become a role model of the employees by building their trust, understanding, and solving of
their problems.
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References
Aebi, V., Sabato, G., & Schmid, M. (2012). Risk management, corporate governance, and bank
performance in the financial crisis. Journal of Banking & Finance, 36(12), 3213-3226.
Antonakis, J., & Day, D. V. (Eds.). (2017). The nature of leadership. Sage publications.
Avolio, B. J., & Yammarino, F. J. (Eds.). (2013). Introduction to, and overview of,
transformational and charismatic leadership. In Transformational and Charismatic
Leadership: The Road Ahead 10th Anniversary Edition (pp. xxvii-xxxiii). Emerald Group
Publishing Limited.
Bolman, L. G., & Deal, T. E. (2017). Reframing organizations: Artistry, choice, and leadership.
John Wiley & Sons..
García-Morales, V. J., Jiménez-Barrionuevo, M. M., & Gutiérrez-Gutiérrez, L. (2012).
Transformational leadership influence on organizational performance through
organizational learning and innovation. Journal of business research, 65(7), 1040-1050.
Hoffman, R., Casnocha, B. &Yeh, C. (2013). Tours of duty: The new employer-employee
compact. Harvard Business Review, 91(6), pp.49-58.
Park, J., & Chung, C. Y. (2016). CEO Overconfidence, Leadership Ethics, and Institutional
Investors. Sustainability,9(1), 14.
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Riccucci, N. M. (Ed.). (2017). Public personnel management: Current concerns, future
challenges. Routledge.
Sageer, A., Rafat, S., & Agarwal, P. (2012). Identification of variables affecting employee
satisfaction and their impact on the organization. IOSR Journal of business and
management,5(1), 32-39.
Tricker, R. B., & Tricker, R. I. (2015). Corporate governance: Principles, policies, and
practices. Oxford University Press, USA.
Yukl, G. A. (2013). Leadership in organizations. Pearson Education India.
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