Impact of Leaders' Behavior on Organisational Effectiveness

Effective leadership and organizational management are crucial for the success of an organization. The report highlights that leaders' behavior, decision-making processes, and structures can influence the effectiveness of organizational decisions. Moreover, it emphasizes the importance of organizational culture, people, and work processes in achieving organizational goals and objectives. For instance, at Next Plc, effective leadership and management enable the company to make better decisions, coordinate efforts across organizational boundaries, and achieve its defined goals and priorities.

ORGANIZATIONAL BEHAVIOUR

TABLE OF CONTENTS
Introduction..........................................................................................................................................4
Task 1....................................................................................................................................................4
Report at interview...........................................................................................................................4
TASK 3.................................................................................................................................................7
Culture and structure of NEXT Plc..................................................................................................7
Impact of culture and structure on performance of business...........................................................8
TASK 4.................................................................................................................................................8
Different approaches to organizational decision making.................................................................8
Effectiveness of organizational decisions in an organization........................................................10
Conclusion..........................................................................................................................................11
References..........................................................................................................................................12

ILLUSTRATION INDEX
Illustration 1: Organizational structure of Next Plc..............................................................................8

INTRODUCTION
Organizational behaviour refers to the ways and manner in which employees and employers
working in a company behave. The behaviour of workforce in the firm depends on the type of
organizational structure and culture which it follows. Through this report, the researcher will
discuss on the general knowledge and understanding related with the effective leadership behaviour
(Robbins, Judge and Boyle, 2013). Further, the researcher will make a study on the impact of
structure and culture of Next Plc to enhance the effectiveness of company. Later, the researcher will
discuss on various methods which will help the firm to improve the effectiveness of employees of
ABC organization so that they can become able to respond to various business opportunities and
threats in an effective manner.
TASK 1
Report at interview
According to the advertisement posted for the vacancy of 'organizational developmental
officer at Next Plc, the report is required by the interviewee to be prepared with respect to cover
various criteria. These criteria are discussed in the following report:
An evaluation of leadership theories
Leadership can be defined as the ability of superiors to influence the subordinates in order to
make them work in accordance with the objectives which are established to be attained for the
organization (Alessandri and et.al., 2012). There are different leadership theories which can be
evaluated. Some of them are like: Great man theory: According to this theory, leader is someone who is recognised from the
distinct personality which he possesses such as excellent intelligence level, great influencing
power and so on. This theory is based on the belief that leaders are exceptional people and
born with natural qualities. Trait theory: Another theory of leadership is the trait theory which says that the list of traits
or qualities associated with the leadership exists in a person. These traits can be defined as
the habitual pattern of behaviour, thoughts and emotions of leaders (Maduenyi and et.al.,
2015). Behaviourist theory: There is another theory that is related with leadership which
concentrates on what the leaders actually do rather than concentrating on the qualities of
them. There are different behaviours and styles or patterns which are observed and
categorised as the styles of leadership. There are mainly two types of behaviour patterns
observed under this theory where one is task oriented leaders and the other is people
oriented leaders.

 Contingency theory: Contingency theory or the situational theory of leadership says that the
company's overall functioning is greatly affected by the extent to which leaders are effective
in the organization (Solomon and et.al., 2014). There are four types of contingency theories
such as fielder’s contingency theory, path goal theory, vroom’s decision making theory and
situational theory.
Impact of managerial styles on organizational effectiveness
Management style can be defined as the manner in which management activities are
conducted in the organization. An effective management style is the extent to which a leader
continuously and progressively leads and directs his followers towards the objective (Winkler and
et.al., 2014). In order to enhance the effectiveness of Next Plc, the leader should adopt various
management styles in practice so that employees would effectively work in the organization.
Types of managerial styles and its effectiveness: Directive: Next Plc can adopt this style which is directly related with the employees. Here,
the leaders and supervisors provide directions to their subordinates in order to perform the
work (Schyns and et.al., 2011). This style is effective for the organization when there is
crisis in company and guidance is required. With proper directions, the work can be
performed smoothly in the firm. Authoritative: This type of managerial style is related to the leaders where they dictate and
control all the decisions in group or task. Under this type of managerial practice, less
importance is given to the feedbacks from employees. This in turn reduces the effectiveness
of this style in organization (Jackson and Parry, 2011). However, this style can prove to be
ineffective in Next Plc as employees are ordered to work and their feelings and emotions are
ignored. Participative: Participative or democratic style of managerial practice has the primary
objective of building commitment and coordination among employees and employers.
Adopting participative and democratic style of managing will help in enhancing the
effectiveness of organization and through this, aim of cited company can be accomplished in
an effective and efficient way (Singh and et.al., 2013). Because employees are involved in
decision making process, this in turn motivates the employees to work more in a firm.
Role of motivation theory on enhancing the employee motivation:
Employee motivation relates to motivate the employees in company in order to increase the
productivity of Next PLC. Being a retail outlet, management of the cited organization has to
constantly work on improving the motivation of employees. Therefore, there are different

motivational theories available which helps in enhancing the employee motivation.
Herzberg's motivation and hygiene theory: According to this theory, there are two groups of
factors that affect the motivation of employees at work (Mohr, Young and Burgess Jr, 2012). These
two factors are intrinsic motivational factors such as recognition and achievement needs of
employees. Along with that, extrinsic hygiene factors which are related with health and security of
employees and working environment can negatively impact the employee’s morale. Therefore, if
managers of Next PLC work on providing security to its employees and better working environment
than this will help in improving the motivation of employees. Also, some of the recognition
programmes can be introduced in company which will help the cited firm to improve the morale of
employees as they would feel that they are valued in the organization.
Maslow need hierarchy theory: The other motivational theory which can help in improving
the motivation level of employees is Maslow’s need hierarchy theory (Pinder, 2014). According to
this, behaviours and actions of every employee are driven by hierarchy of needs. This hierarchy can
be explained with the help of following table:
Needs hierarchy Example
Self actualization Development of employees
Esteem Recognition at workplace, high status and responsibilities.
Belongingness Social needs and relationships.
Safety Security at workplace, health insurance and good working
condition.
Physiological Food, shelter and clothing
This theory of motivation will help the management of Next PLC to improve the morale of
its employees when an employee’s needs are fulfilled in accordance with the hierarchy.
Theories related with work relationship and interaction
Workplace theories are related with the interpersonal relationship theory at work. It is often
essential for employees to share a healthy relationship with their co-workers. However, after getting
selected at the post of organizational developmental officer, being at this post, some of the theories
related with work relationship and interaction can be suggested which are as follows: Social integration theory: According to this theory, society exerts a great impact on
individuals. This theory states that more people start getting involved in the societal
activities will help them to be happier in their lives. Therefore, actively engaging in social

roles will help the individuals to build self esteem, physical wellness and sense of
commitment to the community around them (Malik and Naeem, 2013). Also, it is the
practice which suggests that all members in the organization should participate in
conversation to achieve and maintain the peaceful interpersonal relation.
 Social exchange theory: One of the ways to enhance the interaction at workplace is by
enhancing social exchange activity. According to this theory, interaction among the
individuals is determined by the rewards and punishments which are received from others
(Cao and et.al., 2013). In simple words, it is the interaction that draws out approval from
another person.
TASK 3
Culture and structure of NEXT Plc
Culture and structure of Next Plc has been analyzed by the following ways:
Structure of NEXT PLC
Organizational structure is defined as a system where the hierarchy is defined to make the
employees work. NEXT plc is an organization where various levels have been structured (Next
Corporate, 2015). Managers are appointed for every department or level who are accountable to the
head of organization. Many subordinates are allocated with work by him. This type of structure is
inclusive of various sequences where different roles and responsibilities are defined according to
the departments such as marketing, finance, human resources etc. (Krogh, Nonaka and Rechsteiner,
2012). The main objective of implementing hierarchical structure by Simon Wolfson, who is the
CEO of this organization, is to carry out work effectively and efficiently. Given below is the
organizational structure of NEXT plc:

Culture of NEXT PLC
Organizational culture is defined as the combination of values and beliefs along with
working pattern that exist in the organization. Generally, there are four types of culture namely
Power, Role, Task and Personal. NEXT plc has the principal Board of committees where Audit
Committee, Remuneration Committee and Nomination Committee exist that perform their own
work. It is an instance which shows that this organization performs the role culture where decisions
are taken by these committees.
Impact of culture and structure on performance of business
The impact of culture and structure of Next Plc on its effectiveness has been analyzed as
below:
 Helps in increasing the organizational adaptability during change process. Enhancing the
employee’s faithfulness with shared culture and beliefs.
 Developing communication channels so that new employees can share their ideas at work.
Thereby, exploring their opportunities.
 Strengthening the culture of shared values and beliefs with the aspects of better interaction
and communication.
 To encourage the staff members to interact with customers and therefore, brings positive
working culture.
TASK 4
Different approaches to organizational decision making
Different approaches to organizational decision making has been analyzed. Given below are
Illustration 1: Organizational structure of Next Plc
(Source: Next Corporate, 2015)

four approaches used by Next plc as follows: Rational Approach: This decision making approach uses systematic process and therefore,
it is a cost effective method. The situational goal is planned to identify the problem. After
determining the type of decisions, alternatives are generated to implement the plan. The
manager of NEXT Plc considers this approach as it supports in making logical and in depth
analysis of information to predict the future. The Behavioural approach: According to this approach, manager of organization makes
decisions by bounding coherently. The rule of thumb is applied so that effective decision
making can be laid upon. The manager of Next plc makes use of sub optimizing aspect
where the aspect of best possible outcome is accepted to avoid the unintended effects. It is
analyzed to be an effective approach as it helps in reducing the acceptance of minimal
alternatives in the organization. The Practical approach: This is an approach which is considered as a combination of both
rational and behavioural approach. In respect to this approach, the manager of Next Plc who
acts as a decision maker and believes in defining the alternatives (How Managers Approach
Strategic Decisions, 2015). The rule of thumb is totally avoided in such a case. The
objective lies in defining number of alternatives in a given time and money to deal with the
existing problems in the organization.

 The Personal approach: According to this approach, significant decisions of life are taken.
This is inclusive of using both individual and social approach to accomplish the things
(Nuttin, 2014). It refers to make things recognized to the decision-maker for tackling various
personal issues. However, as per this approach, managers or decision-makers of Next Plc
cannot take personal decisions regarding personal life of employees. Therefore, it is limited
in some or the other way.
Management approaches to risk and uncertainty
Management approaches to risk and uncertainty in decision making process has been
assessed. All the managerial decisions at Next plc are taken under the situations of uncertainty and
risk. The term 'certainty' refers to the situation with one possible outcome for making decision.
Following are the management approaches to risk and uncertainty which are used by Next: Relative frequencies and statistical data: It includes the effects of undesirable aspects that
cause harm to the business environment. Therefore, with the use of traditional method in an
organization, measures such as statistical recording can be taken to manage the risk and
uncertain happening of an organization. Using analytical techniques: With the use of this statistical model, the high complex issues
in an organization are handled and planned (Peppers, 2015). However, it does not require
high accuracy to do work but with the help of developing social network, better things can be
analyzed and achieved. Preparing for multiple outcomes: This is a strategy of the management where members are
involved to take the decisions with alternatives that are most likely to happen. This helps in
generating the most innovative idea as well. Predictions help in bringing good analogy for
the organization.
 Focus on evaluation of initiatives: While carrying out the work, aspect of quality is
maintained by cultivating the stage where decision regarding risk and uncertainty are made
by using the traditional approach of taking ample of initiatives.
Effectiveness of organizational decisions in an organization
The effectiveness of organizational decisions at Next Plc has been evaluated. The factors that
determine the effectiveness of taking decisions at this retail organization are based on following five
areas: Leadership: The existence of skilled and capable leaders at Next Plc is responsible for strong
vision and good team formation. They train the team properly and make decisions regarding
the way to carry out work processes properly. With their guidance and ability to direct and
lead team, the resultant outcomes are achieved with the defined goals and priorities. They

infuse the efforts to make things go appropriately and efficiently in an organization. Decision making and structure: This is considered as the significant aspect which
determines the effectiveness of firm. It depends on the ability of staff members to coordinate
and work together across the organizational boundaries (Schoemaker, 2012). With the help
of organizational structure, the levels are defined in which the responsibility and
accountability between employer and employees is clear. It helps to carry out the flow of
work efficiently. Thereby, helps managers of Next Plc to take better decisions. People: This is a contributory factor which makes the organizational decisions effective.
Human resources are the most significant assets to Next Plc. With the efforts and working
procedures followed by them at their work, the achievement of organizational goals and
objectives are made possible. Work processes and systems: The successful and effective working of Next plc is achieved
by the administrative policies, rules and regulations being followed. Working conditions and
situations hamper the effectiveness of work processes (Mankins and Peccoud, 2011). The
manager of organization works on regular basis to update the norms and systems with
respect to both internal and external members which are responsible for its success in a long
run.
 Culture: This factor is the combination of organizational beliefs and values followed by
Next Plc. The role played by culture factor in measuring the effectiveness of organizational
decisions is crucial (Lee and Hanna, 2015).
CONCLUSION
From the above project, it can be concluded that it is important to understand the behaviour
of leaders so that efficient functioning can take place in company and the results can be achieved
efficiently. Further, researcher has also evaluated different organizational structures such as matrix,
divisional, hybrid structures and so on. Also, it has been assessed in the report that organizational
structure and culture will help in achieving effectiveness in the operations of company. Finally, it
can be said that in order to enhance the effectiveness of organization, employees can be motivated so
that they can help in enhancing the productivity.

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