Leadership in the Modern Business World

This article critically analyzes the concept of leadership in the modern business world and highlights the changes it has undergone. It discusses the job roles and responsibilities of contemporary leaders and the distinction between leaders and managers. The article also explores different leadership theories and their importance in the present times.

Running head: LEADERSHIP ARCHIVE
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Name of the Student:
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Introduction
As stated by Storey (2016), the modern business world is much more complex in
nature as well as the business activities that it deals in contrast to the business earlier times.
Hoch et al. (2018) are of the viewpoint that the complexity as well as the dynamicity of the
modern-day business world becomes evident not only when an analysis of the business
processes used by the business firms but also in terms of the commodities or the services that
they offer. More importantly, it had been noticed that the emergence and the widespread
usage of the different types of innovative disruptive technologies, the widespread usage of the
machinery of internationalisation or globalisation and others have significantly contributed
towards the same (Clinton, 2018). In this context, it needs to be said that this change which
had occurred in the modern business world acts both as a challenge and also as an
opportunity for the business firms. On the one hand, it is seen that the business firms are
facing an ever-increased amount of rivalry or competition within the spectrum of the business
markets of their operations and this in turn is adversely affecting their business prospects
(Sosik & Jung, 2018). On the other hand, the business firms have the option to take full
advantage of the business opportunities presented by the business markets of their operation
and thereby not only earn a higher amount of financial returns but also to attain competitive
advantage (Boyd et al., 2017). However, at the same time it needs to be said that one of the
most important aspects which substantially affects the business processes used by the firms
and also their success is the management as well as the leadership style which is being used
by them within the cauldron of their business operations.
Shamir, Arthur and House (2018) argue that in the face of the extensive changes
which had taken place within the mould of the present-day business world the processes of
leadership and management used by the modern-day business enterprises had undergone a
stark change. The primary purpose of the innovative or disruptive leadership and

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management styles which is being used by the business enterprises is not only to adjust to the
changes that had happened in the world of business but also to take the full advantage of the
opportunities presented by the same (Cashman, 2017). In particular, mention needs to be
made of the changes that had taken place within the framework of leadership and also the
manner in which it is being used by the different contemporary leaders for the execution of
the job roles that they are supposed to perform in the modern business enterprises (Ward,
2016). In this regard, it needs to be mentioned that the job roles or tasks that the
contemporary leaders are complete itself had significantly changed over the years and the
resultant effect of this is that rather than just being limited to the job roles of the leaders, the
contemporary leaders are required to perform a whole gamut of jobs within the contemporary
business enterprises. This paper intends to critically analyse the concept of leadership while
highlighting the changes which had taken place within the same.
Leadership: A Critical Overview
Shapiro and Stefkovich (2016) have noted that the field of leadership is the one which
had been subjected to much change in alignment or conjunction with the changes that had
taken place in the spectrum of the business world. In this regard, Mendenhall et al. (2017)
have noted that leadership is the process through which the individuals or for that matter the
leaders try to influence or modify the attitude or the behaviour of the groups or individuals
for the achievement or attainment of the group objectives or goals. On the other hand, Kruse
argues that “leadership is the process of social influence, which maximises the efforts of
others, towards the achievement of a goal” (Forbes.com, 2019). The resultant effect of this is
that the idea the leaders are required to help the followers towards the achievement of the set
goals had gained prominence in the present times. However, at the same time it needs to be
said that the leaders are required to execute a wide gamut of roles rather than just leading the
followers towards the achievement of the set goals. The different leaders within the

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contemporary business setting are required to perform various job roles like motivating the
followers, offering them mentoring, coaching, creating effective job designs, managing the
process of change management, creating an effective workplace or organisational culture and
others (Schofield, 2019). On the score of these, it is seen that the job roles of the leaders often
coincide with the job roles or the job attributes of the managers and it is because of this that
in the present times it had become very difficult to distinguish the leaders from the managers.
As a matter of fact, the concept of leadership had been in existence since the traditional times
and in the ancient times it was mainly attributed to the particular context of military or
warfare activities (Dart, 2019). However, over the years it had been seen that rather than
merely being associated with the aspect of military or warfare activities, the concerned
concept had been integrated within the framework of politics, business and other aspects of
the lives of the common people (Spears & Lawrence, 2016). This in turn accounts for the
extensive popularity that the concept under discussion here holds within the spectrum of the
contemporary world and also its widespread usage.
Leadership in the modern business setting
According to Bill Gates, “as we look ahead into the next century, leaders will be those
who empower others” (Forbes.com, 2019). In this regard, Heifetz and Linsky (2017) have
suggested that the contemporary leaders, be it the business leaders, political leaders or other
kinds of leaders rather than merely seeking to lead them for the attainment of their goals or
objectives should aspire to empower them as well. As stated by Lussier and Achua (2015), an
important development that had taken place within the cauldron of leadership is the fact that
the contemporary leaders are increasingly being looked upon as the stewards of the business
enterprises on the score of the diversity of the job roles or tasks that they perform. The
modern leaders unlike those of the earlier times need to perform the job roles or the tasks
traditionally attributed to the managers along with the job roles of the business leaders that

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they are supposed to perform. The resultant effect of this is that the managers or the
management teams of the contemporary business enterprises are required to work in close
collaboration or association with the leaders for the effective achievement or attainment of
the business objectives or strategic goals of the enterprise (Coleman, 2019). For the effective
achievement or the attainment of this goal or objective, the leaders are required to participate
as well as fulfil the training, development, remuneration or economic and other basic needs of
their followers (Northouse, 2018). In addition to these, the role played by the contemporary
leaders for motivating, coaching, mentoring, guiding and others the employees or the
followers is also important since it is seen that the performance of the followers or the
employees greatly depends on these aspects. In this regard, it needs to be said that for the
purpose of effectively motivating the followers, the modern leaders are increasingly taking
the help of the construct of reward and punishment not only for the management of the
performance of the employees but also for the enhancement of the same as well (Rosenbach,
2018). Moreover, in the 21st century, it is seen that the business leaders are playing a pivotal
role in the formulation of the strategies of the business enterprises and on the score of these
aspects it can be said that the leaders have become an integral aspect of the contemporary
business enterprises.
Distinction between Leaders and Managers in Contemporary Business Setting
Komives and Wagner (2016) have articulated the viewpoint that in the contemporary
times, the distinguishing lines between the processes of leadership and management had
blurred because of the overlapping job roles that the managers and the leaders perform within
the mould of the business enterprises. However, a close analysis of the job roles or tasks of
the managers and the leaders and also their key attributes or the character traits reveals that
there are some inherent differences between the two in the particular context of the
contemporary business setting. According to Forbes.com (2019), one of the most important

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differences between the managers and the leaders is the fact that the leaders are visionaries
who create some visions and thereby try to achieve them whereas the managers are primarily
goal-oriented who create or establish different kinds of goals or objectives and try to achieve
them within the stipulated timeframe. Another important difference between the two becomes
apparent from the fact that the managers also try to maintain the status quo of the business
enterprises whereas the leaders are often considered to be the change agents within the
organisational setting who try to implement new policies or processes for the improvement of
the business prospects of the enterprises (Covin & Slevin, 2017). In addition to these, it is
seen that the managers merely try to imitate or copy the measures or policies that had proved
to be successful in the context of the other successful business enterprises and thereby try to
follow them hoping to attain the same results and thus try to control the business risks
(Theguardian.com, 2019). On the other hand, it is seen that the leaders are risk takers who try
to take the help of the kind of practices or policies whose outcomes or the results they are not
sure and thus it is seen that they often entail a certain level of risk with them. More
importantly, as noted by Grint, Jones and Holt (2016), the leaders are focused on the
achievement of the long-term goals and thereby try to establish long-term as well as ethical
relationships with not only their followers but also with the other stakeholders of the business
enterprises. However, it is seen that the focus of the managers is on the attainment or
achievement of short-term goals and thereby they try to build different systems or processes
for the attainment of these goals (Forbes.com, 2019). These in short are some of the major
differences between the leaders and the managers within the contemporary business setting.
Leadership Theories: Important Changes
Shamir and Eilam-Shamir (2018) have noted that the prominence held by the concept
of leadership becomes evident from the large number of theories, models, frameworks and
others related to the machinery of leadership that had been articulated over the years.

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However, at the same time it is seen that these theories, frameworks, models and others
related to the notion of leadership had undergone a significant amount of transformation over
the years in conjunction with the changing relationship between the leaders and their
followers, the changing nature of the business setting, the job roles that the leaders are
perform and others (Rosenbach, 2018). The earlier theories of leadership focused primarily
on the character attributes of the leaders and thereby completely relegated the contributions
made by the followers or the subordinates to the background. This is probably an important
reason why the different theories of leadership like the Great Man Theory, The Trait theory,
Behaviour Theory, Autocratic theory and others which focused on the individual character
traits of the leaders were very popular in the 20th century (Northouse, 2018). The Great Man
Theory stated that the leaders were not created but born with some special traits which in turn
distinguished them from the others and thereby made them suitable for the job role of the
leaders (Antonakis & Day, 2017). On the other hand, it was seen that the Trait theory
proposed the viewpoint that the character traits or the attributes of the leaders was the major
factor which distinguished them from their followers and subordinates and thereby helped
them to lead the followers (Forbes.com, 2019). More importantly, the autocratic theory
leadership postulated the viewpoint that the sole power rested with the leaders and they were
entitled to use this power for the effective realisation of the objectives outlined for the
subordinates or the followers (Theguardian.com, 2019).
According to Coleman (2019), one of the pivotal or essential aspects of the modern
theories of leadership is the fact that the leaders and the followers or the subordinates are
being given equal place of importance unlike the earlier times when the leaders were being
given the most important place. The modern leaders within the business setting are not only
required to take into account the perspective or viewpoint of the followers but at the same
time establish effective ethical relationships with them as well. The different theories of

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leadership like transformational leadership, charismatic leadership, authentic leadership,
situational leadership, transactional leadership, leader-member exchange and others have
gained prominence in the present times (Nytimes.com, 2019). As opined by Dart (2019), the
leaders through the usage of the transformational style of leadership try to lead their followers
by example and also use the tool of motivation in an effective manner so as to get the desired
results. It was seen that the leader Howard Schultz, the ex-CEO of Starbucks, through the
effective usage of this style of leadership was able to gain a substantial amount of success
(Schofield, 2019). The leaders through the use of the transactional theory of leadership are
are being able to take the help of the machinery of rewards and punishment for the attainment
of their goals or the objectives (Northouse, 2018). For example, the followers who perform as
per the requirements or the expectations of the business enterprises are being rewarded in an
adequate manner whereas the followers unable to perform as per the expectations of the
leaders or the business enterprises are being punished.
In complete contrast to these, the leader-member exchange theory of leadership
requires the leaders to take into perspective the feedback of the followers for the all the
important decisions or the strategies which are being formulated by the enterprise and that are
likely to affect them directly (Rosenbach, 2018). Similarly, the authentic theory of leadership
requires the leaders to use the constructs of ethics and morals to establish ethical relationships
with the followers (Grint, Jones & Holt, 2016). Another important framework of leadership
which is being extensively used by the different contemporary leaders is the situational
leadership style. According to this style of leadership, through the usage of one particular
style of leadership the leaders cannot deal or handle the different situations that they are
likely to face in an enterprise and thus they need to use the right kind of leadership style on
the basis of the situation that they are dealing with (Shamir & Eilam-Shamir, 2018). An
important example of a leader following this style of leader is ex-CEO of Pepsi Co., named,

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Indra Nooyi (Forbes.com, 2019). These in short are some of the major leadership theories
which are being used by the contemporary leaders within the business setting.
Important Leadership Traits: Examples from the Contemporary Business World
As per Forbes.com (2019), one of the most important attributes that distinguish the
leaders from the followers is their character or personality traits and also the manner in which
they use it for the achievement of the desired goals. Some of the important character traits or
attributes that the contemporary leaders need to possess are effective communication, critical
decision making, emotional intelligence, use of ethics and equality and others (Nytimes.com,
2019).
Richard Branson: Emotional Intelligence
Richard Branson in his books “The Virgin Way: Everything I Know About
Leadership” says that an important aspect that the contemporary leaders need to take into
account for the purpose of effectively leading their followers is the entity of emotional
intelligence (Forbes.com, 2019). Shamir, Arthur and House (2018) have noted that emotional
intelligence can be defined as the character attribute of the individuals which enables them to
not only control their emotions but at the same time as the ability to be aware of one’s
emotions as well as to express it in a meaningful manner. On the other hand, Mendenhall et
al. (2017) argue that the entity of emotional intelligence helps the individuals to “handle
interpersonal relationships judiciously and empathetically”. This is important because of the
fact that the leaders are required to work with different individuals and having an effective
understanding of the emotions of these individuals or the adequate manner in which they
should deal with the emotions of their followers is likely to enable them to lead their
followers in an adequate manner (Cashman, 2017). This becomes apparent from an analysis

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of the manner in which Richard Branson, the founder of the Virgin Group, had used the entity
of emotional intelligence for the purpose of effectively leading his followers.
The world-renowned leader, Richard Branson, is known for the effective usage of the
construct of emotional intelligence within the framework of the leadership style used by him.
It had been seen that Branson uses this attribute not for only for the purpose of effectively
understanding the emotions of the followers who are attached to him but at the same time for
the purpose of enhancing their performance by using these emotions of the followers
(Forbes.com, 2019). For example, it had been seen that one of the most important
requirements of the employees is the fact that their emotional requirements would not only be
understood by the business enterprises that they are a part of but at the same time the
concerned enterprise would use different kinds of measures for the effective fulfilment of the
same. In this particular case of Branson, it needs to be said that the thing which segregates
him from the other contemporary leaders is the fact that he not only try to understand the
emotions of the workers who are a part of Virgin Group but also use it motivate them by
fulfilling them in the best possible manner (Forbes.com, 2019). Spears and Lawrence (2016)
have noted that the leaders who fulfil the emotional needs or the expectations of their
followers are more likely to gain success rather than the ones who completely neglect the
emotions of their followers. This as a matter of fact explains the success gained by Richard
Branson over the years and also the effectiveness with which he had been able to lead the
different employees of the Virgin Group.
Howard Schultz: Use of Ethics and Equality
Schultz had been largely credited with the unprecedented success that the coffee-
chain Starbucks had been able to attain over the years (Dart, 2019). As a matter of fact, he
transformed the small coffee house which used to be the Starbucks back in the later half of
the 20th century to the largest beverage chain that Starbucks presently is (Nytimes.com,

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2019). The use of effective leadership style and also the entities of ethics and equality had
been largely instrumental in the success that he had gained over the years (Ward, 2016). For
example, all the employees of the coffee-chain under discussion here and the different
shareholders, investors and others were being treated in an equal manner by the concerned
leader (Dart, 2019). Here, mention needs to be made of the coffee-sipping ceremony that the
concerned business firm had been using over the years. The coffee-sipping ceremony was
initially conducted at the different annual meetings of the firms wherein all the shareholders,
investors and others related to the firm used to sip coffee at the same time to commemorate
the culture as well as the success of the firm (Nytimes.com, 2019). However, recently it had
been seen that Schultz started the use of this ceremony to welcome the new employees within
the spectrum of the concerned firm as well. Furthermore, the ethical as well as the equal
treatment that all the employees and the stakeholders of the firm are being offered had
Schultz to get the desired results and also achieve the business objectives of Starbucks (Dart,
2019). Hoch et al. (2018) have noted that one of the most important factors that influences the
behaviour or the attitude of the followers is the manner in which they are being treated by the
leaders. As a matter of fact, if the leaders treat the followers in an ethical as well as equal
manner then it is more likely that they would be able to perform as per the expectations of the
leaders or the firms to which they are related and vice versa (Nytimes.com, 2019). This in
turn facilitated the success attained by the coffee-chain Starbucks and also by Schultz.
Bill Gates: Innovative and Risk-Taking Nature
Bill Gates is considered to be one of the most innovative as well as risk taking leaders
of the modern business world on the score of the business decisions and also the leadership
style that he had followed over the years. In this regard, it needs to be said that some of the
decisions made by him like the decision not to collaborate with IBM, the different employee
policies followed by Microsoft, the stand taken by him in response to the Anti-Trust Case

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filed against Microsoft in the last decade of the 20th century and others point towards this
(Schofield, 2019). More importantly, over the years it had been seen that he insisted that the
employees of Microsoft should effectively use the aspects of creativity and innovation for the
job roles that they perform and for the effective attainment of this end he tried to foster an
innovative as well as continuous learning environment within the spectrum of the firm
Microsoft. However, at the same time it had been seen that many people have criticised the
autocratic leadership style followed by him over the years despite the fact that the followers
associated with and also the firm Microsoft had been able to benefit in a substantial manner
through the innovative approach taken by him (Forbes.com, 2019). Furthermore, another
important aspect of the leadership style followed by Gates is his risk-taking nature which
becomes apparent not only from the business idea that he developed but also from the
different strategies that had been used by Microsoft over the year (Schofield, 2019). Boyd et
al. (2017) have stated that the contemporary leaders are required to be innovative and risk-
taking and these two attributes in turn distinguishes them from the managers. In this context,
it needs to be said that the risk-taking and innovative approach taken by the leaders is
important because it not only helps the followers to achieve the goals or objectives in an
effective manner but also to achieve the long-term goals that they have formulated
(Schofield, 2019). Thus, it can be said that the effective usage of these two entities had
contributed in a substantial manner towards the success gained by Bill Gates over the years.
Conclusion
To sum up, the leaders not only help the followers to achieve the strategic goals or
objectives that the business enterprises have formulated but also help in the growth of the
enterprises in an effective manner. The landscape of the machinery of leadership is the one
that had been subjected to much change over the years. This becomes apparent from the
changes that had not only occurred within the world of leadership but also the changes that

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had undergone in the models, frameworks, theories and others related to the aspect of
leadership. The modern leaders are required to have different kinds of character traits like
effective communication, critical decision making, use of ethics and equality, innovative and
risk-taking approach and others. These character traits or attributes are important because
they not only help the leaders to lead their followers but at the same time create value for the
firms with which they are associated. These aspects of leadership become apparent from the
above analysis of the different concepts of leadership.

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