Leadership and Management for Service Industries

ICON College of Technology and Management Faculty of Business and Management Studies BTEC HND in Business Subject: Leadership and Management for Service Industries Cost Tutor: Submitted by: Full Name: Pepa Kalinova ID No: ............ Session: September, 2020 Contents Introduction 3 LO 1 4 Different classical management theories and their application to Costsaver 4 The roles of the leader and different leadership styles in Costsaver 5 Review the management and leadership styles in Costsaver 8 LO 2 10 Internal and external factors that influence

ICON College of Technology and Management
Faculty of Business and Management Studies
BTEC HND in Business
Subject: Leadership and Management for Service Industries
Tutor:
Submitted by:
Full Name: Pepa Kalinova
ID No: …………
Session: September, 2020
1

Contents
Introduction................................................................................................................................................3
LO 1............................................................................................................................................................4
Different classical management theories and their application to Costsaver...............................4
The roles of the leader and different leadership styles in Costsaver.............................................5
Review the management and leadership styles in Costsaver........................................................8
LO 2..........................................................................................................................................................10
Internal and external factors that influence management styles and structures of Costsaver. 10
LO 3..........................................................................................................................................................13
Current management and leadership ‘hard’ and soft’ skills for Costsaver..................................13
Future management and leadership skills required for Costsaver...............................................15
LO 4..........................................................................................................................................................17
Comparison and contrast between Costsaver and HSBC............................................................17
Conclusion...............................................................................................................................................19
Bibliography.............................................................................................................................................20
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Introduction
Management is the process of achieving an organisation’s goal by using its all resources. Here
the management must plan and make a schedule for further processes, organise all the
resources at the appropriate time of production, direct and motivate personnel activity,
coordinate all personnel’s task and at the end of the session evaluate and ensure that it can
achieve its goal by following management’s command. The sustainability of organization highly
depends on the good relationship between managers or leaders and employees. In this
assignment, the classical theory of management, different leadership styles, factors that
influence the structure of management, soft and hard skills required for managers, and future
required skills are described in perspective to Costsaver. Costsaver is a world-famous tourist
organisation that brings travellers from all parts of the world to introduce the new culture, the
new part of the world. It deals with almost 450+ travel spots.
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LO 1
Different classical management theories and their application to Costsaver
Figure 1: Classical Management Theory; Source (Self-designed)
Scientific Management Theory
Scientific management theory focuses on employee’s productivity and the efficiency of
production. To control employee’s productivity, Taylor introduced a scientific guideline that
helped to train and manage employees scientifically. And then they try to keep an ecological
balance in their performance which is highly required for the sustainability of the organisation
(Mahmood et al., 2012). The employees of Costsaver are trained scientifically to cope up
themselves with day to day update. For costsaver, customer-employee relationship is very
essential. Because the agency may have good fame but employee’s personnel service with the
customers plays significant role in customer’s satisfaction. The consistency of providing best
service among all employees is also another important factor.That’s why the authority focuses
highly on the efficiency of their employees.
Bureaucracy Theory
Introduced by Max Waber, this theory states that an organisation must have a hierarchical
structure, line of authority, labour specialization, and well-defined rules and regulations like a
government organisation. But for ensuring sustainability of the organisations, it may not suitable
as they need to take quick decisions and need flexibility in procedures (Mahmood et al., 2012).
Costsaver also has well-defined rules and regulations and a hierarchical structure. Due to
uncertain future, its management is very flexible for ensuring rules and regulations keeping
another supplementary option to implement. While making policies, the authority considers
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current and future economic, social, and environmental impacts and takes flexible decisions to
fill the needs of visitors, the agency, and other stakeholders.
Henri Fayol’s Theory
Henry Fayol introduced six functions of management needed for improving the sustainability of
the organisation. According to Fayol, management must plan and make a schedule for further
processes, organize all the resources at the appropriate time of production, direct and motivate
personnel activity, coordinate all personnel’s task and at the end of the session evaluate and
ensure that it can achieve its goal by following management’s command (Nhema, 2015). The
management of Costsaver also goes through the six functions of Fayol. Fayol told to give more
concentration on management efficiency rather than employee’s efficiency. But the authority of
Costsaver focuses more on the efficiency of employees than the efficiency of management.
The roles of the leader and different leadership styles in Costsaver
The roles of leader of Costsaver
A person who leads a group of people or an organisation towards a specific goal through a
particular method is called a leader. So, a leader has to go focusing on the sustainability of the
organisation. A recent survey shows that leaders turn their focus on the sustainability of
hospitality industry. This is because of high competition of developing environmental, economic
and social factors that influence hospitality industry directly or indirectly. The roles of leaders:
Figure 2: Roles of Leaders; Source (Self-designed)
Decision-maker
Leaders are always decisive and make hard choices. Leaders have to choose one, even they
go through little or less than perfect information. The leaders of Costsaver take decisions based
on organisation’s policy and strategy. If any situation arises not included in organisation’s policy,
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the leaders solve that situation in such a way that doesn’t contradict organisation policy or
strategy (Oreg and Berson, 2011).
Coordinator
A leader coordinates the personnel task toward organisation’s goal. This can be done easily
only if the leader can influence the employees and the employees are willing to cooperate. The
leaders of Costsver coordinate all employees’ tasks through a definite guideline followed by the
authority. Here the leaders can influence the employees easily because of having good relations
between the employees and the leaders (Mitra et al, 2012).
Supporter
A leader may be a friend or a guide by supporting and cooperating with his subordinates. He
always invites support and cooperation to his subordinates that help to implement guidelines
practically (Oreg and Berson, 2011). The leaders of Costsaver provide proper guidelines before
giving tasks and provide 24 hours of support to their employees.
Disturbance Handler
Every day lots of problems arise in an organisation. Some problems have pre-planned
directions on how to solve and some problems are new faced by the organisation (Roche et al,
2014). Costsaver has a pre-planned guideline that states how to handle any arising problem.
But in case of new problems, the leaders solve the problems by themselves following the
organisation’s policy and strategy.
Visionary
Leaders prepare a guideline that reflects the destination of their journey. By this quality, leaders
forecast the future and take necessary steps to cope up with the future. The leaders of
Costsaver take decisions by forecasting the future. They also think about how the pandemic
COVID-19 situations affect their organisation and how it will affect in the future. That’s why they
are taking the necessary steps to cope up with any situation (Mitra et al, 2012).
Different leadership styles for Costsaver
In hospitality sectors, there are huge competitions among the hospitality industry members.
Though it is a lucrative business, there is also scarcity of customers in this sectors. So, it is
important to keep a good relationship between leaders and employees to ensure the
sustainability of the organisation even in recession.
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Figure 3: Leadership Styles; Source (Self-designed)
Democratic or Participative Leadership
A democratic leader takes final decision not only by himself but also by honouring other
member’s opinions. Here he invites others to participate in decision-making process with their
valuable opinions to enhance their satisfaction and decision-making skills
(Nanjundeswaraswamy, 2014). Costsaver runs it services in many countries having a different
culture. So, the top management ensures the participation of branch managers while making
policy and strategy. At the same time, to implement top-level’s policy or strategy the branch
managers takes valuable opinions from the field level managers. This way employee’s
participation in decision making is ensured for ensuring management sustainability.
Autocratic Leadership
All decisions making power are centralized in the autocratic leadership style. Managers don’t
consult with employees and don’t allow employees to provide any input in decision making even
it is for the interest of the organisation (Jogulu, 2010). Costsaver mainly takes decisions based
on the democratic leadership style. But in case of quick decisions, they can’t allow other’s
participation.
Free-Rein or Laissez-Faire Leadership
In this leadership style, management told employees to complete a particular task. But they
provide a little guideline or in some cases no guideline on how to complete the task properly.
This kind of leadership style is suitable only if employees are very responsible and creative and
guided by their own aspirations (Jogulu, 2010). The management of Costsaver doesn’t support
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this leadership style. The management provides task to employees and provides all directions
until the task is completed.
Paternalistic Leadership
In this leadership style, the whole organisation is considered as a family and the leader is the
head of that family. As a head, the leader provides proper directions and guidelines to his
subordinates to complete their assigned tasks (Nanjundeswaraswamy, 2014). Costsaver works
as a family in spite of having branches to different countries. The authority divides the whole
manpower into different teams with different tasks. And all teams work under a team leader who
is accountable to his higher authority.
Review the management and leadership styles in Costsaver
Figure 4: Management and Leadership Style; Source (Self-designed)
Management Style
Costsaver is a UK based travel organisation which has a better management system.
Employees working at different levels have good relationships among them. All employees play
a key role in giving better service to their customers.
Experienced travel managers as well as funny and sensible tourist guides make the travel more
enjoyable. So, the managers focus on the performance of the employees and the employees
are trained scientifically for updating themselves in the modern world.
The organisation also has a hierarchical structure and well-defined rules and regulations. But
these are flexible and also changeable only if situations arise. At the time of economic
recessions or world pandemic situations, managers go for a new plan and make a schedule for
further processes, organize all the resources on time, direct and motivate personnel activity,
coordinate all personnel’s task for the sustainability of the organisation.
Due to world pandemic situation, almost all travel agencies are going to be stopped like
Costsaver. Management needs to take totally new policies and strategies to survive in
pandemic situation.
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Leadership Style
Costsaver is a travel organisation that brings travellers from different parts of the globe to
provide hassle-free tours. It has worked different parts of the world having 450+ tourist spots.
This organisation has a lot of employees working in different branches of the world. So, the
policies, strategies, and directions vary from one branch to another branch.
The top-level leaders of Costsaver does not know all about different branches and tourist spots
because of their different culture and country’s different rules and regulation. So, at the time of
policy-making, the leaders ensure the participation of branch managers with their valuable
opinions. Here, the branch managers represent their subordinates.In this way, Costsaver
ensures the participation of all employees in decision-making process. So, it can be said they
fully follow the democratic leadership style by respecting other opinions.
Due to COVID-19 pandemic, accessibility to many tourist spots are stopped and number of
customers are also reduced. Now the management of Costsaver focuses on how to survive
maintaining management sustainability rather than enriching its growth.
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LO 2
Internal and external factors that influence management styles and
structures of Costsaver
A business may be influence by internal or external factors. But hospitality industry is highly
influenced by external factors rather than internal factors. Their success and sustainability
depends on how much they can control external factors. Over the past several decades,
managers focused on only the sustainability of the organization because of high influence of
environmental, economic and social factors. Even, the current pandemic situations also force
management to focus on sustainability rather than a decent success.
Internal factors that influence management style and structure of Costsaver
Figure 5: Internal Factors Influenced Management Structure and Style; Source (Self-designed)
Owners and Shareholders
Owners may be individuals or groups of people who started the business or bought shares of
that business. They have a valid claim on organisation and a strong influence on the
management structure (Adams, 2002). The owners of Costsaver indirectly influence in
management decision-making process. They select the board of directors by themselves who
represents the owners.
Employees
From decision making to implement planning, all task are done by employees. The top-level
employees play role in decision making and the low-level employees play role in implementing
top-level’s plans (Sivadas and Dwyer, 2010). The employees of Costsaver works like a family
and connected each other through a chain. As they follow the democratic leadership style, the
employees play a significant role in the management structure.
Board of Directors
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The board of directors is elected by the owners or shareholders of the company. The main tasks
of the board of directors are policy-making, strategy making, and overseeing a firm’s top
managers such as the general manager (Sternad et al, 2011). The owners of Costsaver select
the members of the board of directors and they are responsible for making policy, strategy, rules
and regulations, proper guidelines and directions, and the way of reaching their ultimate goal.
Resources of the Organisation
Man, machine, money, materials, method, and market are the resources of an organisation.
While taking any decision, management needs to consider the strength and weakness of these
resources (Cucchiella et al, 2012). Costsaver is a travel organisation whose main resources are
attractive tourist spots and entertaining tourist guides. After SWOT analysis, the authority takes
further decision.
Culture of the Organisation
An organisation’s culture is the collection of employee’s beliefs, behaviours, habits, and values.
While making policies and strategies, management has to consider either their policies or
strategies go against organisational culture or not (Sivadas and Dwyer, 2010). The employees
of Costsaver work in different branches of the world and so they have different cultures. So, the
management has to consider the different cultures of different countries at the time of policy-
making.
External factors that influence management style and structure of Costsaver
Figure 6: External Factors That Influence Management Structure and Style; Source: (Self-
designed)
Legal Factors
Legal factors include the laws and regulatory frameworks in a country. These factors protect
companies from unfair competition and consumer from unfair business practice (Sternad et al,
2011). The managers of Costsaver must have the knowledge about the major laws which
protect their organisation, customers, and society from the unfair business. They also think
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about international legal factors introduced by the World Tourism Organisation and the legal
factors of those countries where they run their business.
Socio-cultural Factors
Socio-cultural factors deals with culture, changes of lifestyle. Social mobility, attitudes towards
technology, and people’s values, opinion, beliefs, etc. Managers must study well socio-cultural
dimensions to provide standard services that go with customers (Sivadas and Dwyer, 2010). In
20th century the management of Costsaver highly focused on single person tour along with other
unknown persons. But in recently, they have provided mostly family packages due to change of
socio-cultural factors.
Environmental Factors
Policy-makers should consider the availability of raw materials, cost of energy, level of
environmental pollution, and government rules and regulation to protect environment. For
Costsaver, most of the tourist spots are natural. So, the management considers highly the
nature of that tourist spots and doesn’t allow to visit in adverse situations (Adams, 2002).
Technological Factors
Technological factors deal with information technology, internet, global transfer of technology,
biotechnology, and so on. An intelligent response to technological changes is more effective
rather than reactive (Sternad et al, 2011). The strategic managers of Costsaver monitor the
advancement of technology for their industry at the time of formulating policy and strategy.
Because of quick study of technological changes, Costsaver can easily adapt with technological
changes which ensures its management sustainability.
International Factors
Global technology has brought all the nations together connecting every part of the world.
Costsaver is a world class tourist organisation having 450+ tourist spots throughout the world.
Its customers come from different parts of the world. The strategy makers of Costsaver have to
consider current international factors while policy making to attract customers highly (Cucchiella
et al, 2012).
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LO 3
Current management and leadership ‘hard’ and soft’ skills for Costsaver
Hard skills refers some technical skills that employees learn through education or training and
differ company to company. On the other hand, soft skills are natural abilities that employees
acquired through life experience and transferable across industries.
Hard skills required for management and leadership of Costsaver
Figure 7: Hard Skills Required for Costsaver; Source (Self-designed)
Technical Skill
Technical skills refer specialized knowledge on information technology and ever changing
technological advancement (Laker and Powell, 2011). Costsaver is a modern travel agency
which provides services based on modern technology. So, every employee is trained to cope up
with upgraded system of technology. The management structures are designed in such a way
that helps employees to be innovative through modern technology.
Project Management Skill
One of the best hard skills of managers or leaders, it includes all tasks of a project from
planning to evaluating. In Costsaver, every tour is considered as a project. In every project,
there is a leader or manager who coordinates the performance of his subordinates and makes
sure the success of his project. Here, success depends on the satisfaction of the customers
(Burns, 2007).
Analytical Skill
Analytical skill refers collecting and analysing data and depicting their inner meaning to present
in a formal way. The managers of Costsaver collect data about the world economic condition,
world tourist spots available to visit, the people who are interested in visiting and how the
authority can reach to them and attract them, and so on (Klaus et al, 2017). This analytical
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ability makes the organisation sustainable even in worse situations. Only because of high
analytical skill, managers can induce the customers.
Language Skill
Language is a medium of communication. If organisation runs its business out of the country,
managers need to have good commend over English. Costsaver is a world-class tourist
organisation. The guides working in Costsaver have good knowledge over different languages
along with local language. Because the guides have to deal with customers of different
countries and also local tourist spot’s maintaining authority (Laker and Powell, 2011).
Soft skills required for management and leadership of Costsaver
Figure 8: Soft Skills Required for Costsaver; Sources (Self-designed)
Creativity
Creative leaders or managers invite employees to innovate, courage others to generate new
idea that enhance the advancement of the organisation. The managers of Costsaver spend lots
of time to generate new ideas that help them to provide better services to their customers.
Providing most successful occasional packages in different countries is also come from
employee’s innovative ideas. Because of exceptional idea, they turn into one of the world best
tourist organisations (Burns, 2007).
Persuasion
Persuasion is the ability to influence other’s attitudes and behaviours through formal or informal
communication. Costsaver is a tourist services providing organisation. There are lots of tourist
organisations along with Costsaver. So, the managers and employees focus on how effectively
and positively they can persuade their customers and attract them to take their services keeping
customer relationship (Klaus et al., 2017).
Communication
Effective communication can create a productive environment. At the same time, good flow of
communication is also necessary. The managers of Costsaver have a good command over
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communication. They have strong capacity to communicate different people coming from
different countries and their guides are best in this case (Laker and Powell, 2011).
Problem-solving Skill
Everyday lots of problems arise in an organisation. Some problems have pre-planned directions
on how to solve and some problems are new faced by the organisation. Costsaver has a pre-
planned guideline that states how to handle any arising problem. But in case of new problems,
the leaders solve the problems by themselves following the organisation’s policy and strategy
(Burns, 2007).
Adaptability
Managers or leaders have to work ever-changing environment. So, they have to adapt new
environment as soon as possible. The managers of Costsaver enjoy the change of environment
and the transfer from one branch to another branch because these help managers to introduce
themselves with new era. The management is trying hard and soul to find out new ideas that
help to adapt in current situation (Klaus et al, 2017).
Future management and leadership skills required for Costsaver
The current COVID-19 pandemic has reminded us that the future may be volatile, uncertain,
complex, and vague and the leaders or managers have to accept the reality. Over the past
decades, there is high requirement for sustainable hospitality industry. Even recently, many
hospitality industry has stopped because of scarcity of customers comparative to number of
hospitality industries. At the same time, world economic conditions, environmental disasters,
legal policies force the managers to be talent to survive with success.
For ensuring a sustainable management system, the future managers or leaders must have the
following skills:
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Figure 9: Future Required Management and Leadership Skills; Source (Self-designed)
Strategic Thinking
Like present, in future the leaders have to find out the best route to get outcome that delighted
the people they serve. The leaders have to make a clear vision forecasting the future threats
and opportunities and achieve the goal along with all the employees. The managers of
Costsaver have to review their strategy and policy. Due to the COVID-19 pandemic situations,
the demand for tourist services is reduced highly. And no one knows when the world come to its
normal situation. So, the authority of Costsaver has to change its strategy and has to enrich
manager’s strategic ability in future (Hillmann et al, 2018).
Clarity
Clarity is the ability to see the future through messes and contradictions that others can’t see.
Costsaver is a travel organisation which brings travellers from different parts of the world to see
the unseen and to know the unknown. Here, Costsaver is not only the travel organisation to
provide these services. So, the managers have to measure the unknown future before the
managers of other organisations to provide better services to their customers (Suh and Shin,
2012).
Farsightedness
It is the ability to understand the future. The present situation of Costsaver is not so good
because the world goes through pandemic COVID-19 situation. Because of this, the travel
organisations are going to be almost stopped because of security. So, the managers need to
forecast the future of Costsaver and need to find out new strategy and policy that help them to
survive (Suh and Shin, 2012).
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Creativity and Innovation
By creativity, the leaders create new ideas that are essential for the organisation. On the other
hand, by innovative quality, the leaders can innovate new technology that minimize the cost of
providing services. The managers of Costsaver have to create and innovate new ideas, short
way of transportation, new policy that help to run their business in normal or pandemic situation
(Hillmann et al, 2018).
Team development
Team development is equally important as own development. The leader must be aware of all
resources available to his team. Costsaver works like a family dividing into different teams. But
the team member’s tasks are defined previously. The team leader needs to meet every team
members and discusses about member’s interest, ambition and goal. And then, the leader
should work together to reach their goal (Hillmann et al, 2018).
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LO 4
Comparison and contrast between Costsaver and HSBC
Costsaver and HSBC both provide services to many countries of the world. Costsaver brings
travellers from different parts of the world to introduce a new world. On the other hand, HSBC
provides banking services to many countries of the world under its headquarters in London.
Figure 10: Comparison and Contrast between Costsaver and HSBC Bank
Both Costsaver and HSBC have well-defined hierarchical structure and directions flow from top-
level to lower-level like straight line method. In case of Costsaver, the mid-level and low-level
managers can participate in decision making process. But in case of HSBC the lower-level
managers only implement the policies made by top-level and mid-level managers. They can’t
participate in decision-making process.
Both Costsaver and HSBC are services industry and so, customer and employee relationship
plays a key role in their success. So, the managers of both organisations mainly focus on the
efficiency of employees who provide direct services to customers. That’s why, managers train
employees in such way so that they can persuade the customers positively.
Costsaver is a world famous tourist organisation. So, the managers have to consider the rules
and regulations of World Tourism Organisation along with different countries tourism policies.
On the other hand, HSBC is a banking organisation. So the managers of HSBC need to
consider the rules and regulations of World Bank, International Monetary Fund along with
different countries monetary and banking policies.
The managers of HSBC provides well-defined directions to employees. Even there are
directions on how to solve any arising future problems. On the contrary, the managers of
Costsaver provide a flexible guideline to its employees that help employees to provide best
services to customers. In case of arising problem, employees are free to solve by themselves
maintaining organisation policy.
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As Costsaver and HSBC run their business throughout the world, they are mostly affected by
same external factors comparative to internal factors. Cultural factors, environmental factors,
legal factors, and economic factors are major in this regards. But economic downtown affects
HSBC highly rather than Costsaver.
The world pandemic COVID-19 affects both HSBC and Costsaver negatively. But in this
situation, HSBC runs its activities wholly in online though it may not be as good as before. On
the other hand, Costsaver provides personnel services to its customers. So due to safety issues
and economic recession, Costsaver can’t continue its business. So, the managers of both
organisations need to think about new strategy and policy that help them to continue their
business successfully.
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Conclusion
For an organisation, management is the brain of an organisation. Without proper management
system, an organisation can’t run its business properly. A good leadership system also plays a
significant role. Here the managers or leaders can follow any classical theory of management to
manage its man-power effectively. The leaders and managers should have good command over
human, technical, and informative skills. The policy makers also need to consider the internal
and external factors that influence the organisational behaviour while making decisions. In this
way, managers will be able to maintain sustainable management system and can reach their
destinations along with their subordinates.
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