Effective Leadership Styles for Companies

This assignment examines different leadership styles and their effectiveness in driving organizational success. It analyzes autocratic, democratic, laissez-faire, transformational, and transactional leadership approaches, highlighting the benefits and drawbacks of each style. The discussion draws examples from companies like Starbucks to illustrate how these leadership models can be applied in real-world scenarios.

Understanding
and
Leading change

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
P1. Comparison between different organisation’s operations and strategy after adopting
changes...................................................................................................................................1
P2. The way internal and external drivers of change affect leadership, individual and team
behaviour................................................................................................................................4
P3. Evaluate how to minimize negative impact of change on organisation...........................6
TASK 2............................................................................................................................................7
P4: Barriers which affect the change and affect leadership decision making strategies........7
TASK3.............................................................................................................................................8
P5. Application of suitable leadership style in organisational context...................................8
CONCLUSION..............................................................................................................................10
REFERENCES..............................................................................................................................11
.......................................................................................................................................................12

INTRODUCTION
The business organisation can achieve success only when they make regular innovative
changes in their business operations. As business environment changes rapidly therefore, it is
necessarily required for company to adopt innovative and useful changes in order to survive in
the competitive market. An organisation can attain a strong position in competitive market world
only when they have capability to accept changes that will help them in competing with their
competitors. Main purpose of preparing this report is to provide the importance and impact of
changes on organisational structure and strategies. The project also covers different drivers of
change that put a huge impact on leadership, team and individual behaviour. The two
organisations such as Starbucks and Costa are selected for the purpose of preparing this report.
TASK 1
P1. Comparison between different organisation’s operations and strategy after adopting changes
Organisation make changes in their structure and business operations after analysing the
present trends, technology, customer's interest and behaviour as well as market tactics, etc. It is
essentially required for an organisation to adopt favourable changes in order to take benefits of
dynamic trends. An organisation needs to concentrate on the changing trends and accordingly,
adopt themselves in such changing business environment which allow them to compete with
their rivals in an effective and efficient manner. Starbucks and Costa are two such organisations
which operate their restaurant in various places and destinations.
Starbucks
It is a UK company which deals in providing coffee and refreshment services to its
customers of different countries. Starbucks firstly started its business in the streets of
Washington offering fresh roasted whole beans coffees. After that, it expanded their business in
over 50 countries and now, operating in more than 15000 stores across America.
Costa
It is also a UK based company which started its business in 1971 by costa family
providing roasted coffee beans and Italian coffee in the streets of London. After that, they
successfully expanded their business in more than 31 countries and has operated over 3400 stores
in different countries. They also focused on targeting India to expand their business through
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opening their coffee shop chain. It has attained second position in the market after Starbucks and
also, gained largest market share in UK.
Both organisations have their own strategies in order to accelerate their business through
adopting innovative and competitive changes:
Strategies Starbucks Costa
Competency based strategies An organisation needs to
analyse tastes and preferences
of its targeted customers and
accordingly, implementing
plans and strategies to full
them in an effective manner.
At first, company could not
categorise their products
separately but after adopting
changes in strategies, they
categorised the products as per
customer’s tastes and
preferences. Starbucks offers
hot and old beverages and
many more items which need
to be categorised on the basis
of their price and calories in
the menu card which facilitate
customers to buy whatever
they want.
This company is also engaged
in providing similar products
such as teas, chocolates as well
as iced and Frescato. They
cannot estimate requirements
of customers while making
coffee which increased the cost
of products. Therefore,
company needs to first analyse
the needs and demands of
customers as well as their
behaviour through which they
get to know that in how much
quantity they need to make
which can meet customer's
requirements. They also need
to bring some changes in the
taste of coffee which can
attract a large number of
customers.
Pricing strategies Starbucks has attained a strong
brand name and the largest
market share due to which they
can change high prices on their
products which reduces
Due to adopting competitive
pricing policy, company is
able to provide its product at
low cost which attracts a large
number of customers. But
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customer's interest to buy their
product. It affects their
profitability as well. Therefore,
company needs to adopt
economic product and quality
policy through which they can
categorise products on the
basis of quality and price
ranging from high to low. This
will help company to get
profitable results and attract
customers of different age
groups.
adopting such pricing strategy
is not enough to achieve
growth in business. Company
needs to categorise the
products and price policy
which help them to attain
competitive advantage.
Promotion and advertising
tactics
They generally promote their
products through using various
promotional strategies which
increase product’s cost and
low profit. Starbucks has
attained a strong brand image
and therefore, they are
adopting every marketing
strategy that will help them in
making their products reach to
a large number of customers.
Company believes in
providing good quality of
goods and services through
which they cannot invest a
large amount of money in
advertising their products. But
in order to attain a large
market share, company has to
present its products effectively
in front of customers that will
encourage customers to move
towards consuming company's
products.
Process Starbucks is operating over
15000 stores in USA itself
through which their customers
can get their products by
In Costa coffee, the process of
delivering products is
different. Their employees
who are working in stores have
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visiting their stores. But at
present, online delivery and
placing order services allow
customers to get company's
products without visiting their
stores. Providing such
facilities enable company to
attract more customers.
responsibility to take order and
serve products on the
customer's table. It can be
successfully done only when
the employees have good
communication, behaviour and
presentation skills.
P2. The way internal and external drivers of change affect leadership, individual and team
behaviour
Leadership
It is an ability of person who motivates the workers to work as a team and contribute
maximum efforts to achieve desired goals and objectives. Such person is known as a leader who
has skills and capabilities to lead a team and provide right direction in order to bring more
efficiency in work. Such skills and qualities are developed in person by birth and can be
developed through getting work experience. There are different styles of leadership which can
formed according to the structure of business organisation in order to achieve common desired
goals. There are also some challenges and problems which can affect the behaviour of
leadership, an individual or a team while making some changes in an organisation. Such changes
are considered as internal and external drivers of changes.
Internal drivers of change
 Brand image, market share of an organisation, capital structure are considered in this
factor.
 Advancement and innovations are also covered in this factor which help company in
achieving growth and profitability through promoting products to attract customers.
 Adopting changes in an organisation is possible only when their employees give their
free consent. Therefore the company need to maintain and develop culture and theme of
organisation, employees behaviour and leadership style which make a positive impact on
adopting changes in an organisation.
 Wastage of available resources also affects the productivity and profitability of company.
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External drivers of change
Customers: It is considered as prime factor of external drivers of change. Customers are
main factor which decide the success and growth of business in future.
Competitors: There are huge competition in same type of organisation in market world
which creates risk and difficulties for company to survive in competitive market world. Thus it is
important for company to adopt innovative changes that will help them in attaining largest
market share and competitive advantage.
Investors: They are the one who invest their money in an organisation in order to get
maximum amount in return (Drover and Ariel, 2015). The company can adopt and implement
new projects and plans only when they have sufficient capital therefore to achieve desired target
the company need to raise funds from various financial institutions, banks, businessmen and
creditors etc. such are called as an investors.
Technology: Implementing advanced and latest technology in manufacturing process of
product will bring additional value in the characteristics of product which help in maximising the
level of satisfaction of customers. Adopting innovative technology for the purpose of adding
value and unique features to product will attract large number of customers. Therefore it is
required for employees working in an organisation to have specific knowledge and skills to
utilize technology in an effective and efficient manner (Different type of leadership styles,
2017).
Government: It is required for company to follow rules and regulations implemented by
government which also may affect the organisational structure of company. Therefore in order to
run business are smoothly the company are required to follow standards and guidelines given by
government which help company in achieving desired objectives without facing any difficulties.
Linkage of leadership with drivers of change
Leaders refers to the person who have abilities and capabilities to motivate workers to
work as at am and contribute together their maximum efforts in achieving common desired goals
and objectives. It is the responsibility of a leader to evaluate the nature and theme of organisation
and accordingly utilise its skills and knowledge while implementing changes. Leader must need
to identify the nature and behaviour of their employees and accordingly implement strategies to
direct their team members to perform given task in more effective and efficient manner. He is
liable to communicate its team members and inform them about the benefits of implementing
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some changes that will help them in influencing the interest of employees in favourable manner.
Effectivenesses of leadership skills of leader can be examined only through comparing actual
result after adopting changes in an organisation (Fragouli and Ibidapo, 2015).
Leadership goals and motive
There are some objective or goals that need to be achieved by leader which are as follows:
Direction: Leader must provide direction to its team members through communicating
and inform them about their roles and responsibilities.
Control: Leader has a skills to analyse the performance of workers through monitoring
their performance in grid and statistical format. This will help in getting accurate desired
outcome (Reiman and Pietikäinen, 2012).
Authority: Effective and proper authority are required to given to a leader which allow
them to operate business functions smoothly. They also have some rights regarding appointing
and removing staff member according to their interest and behaviour in an organisation.
Influence: Conducting motivational and incentive programs such as giving rewards,
compensations, bonus etc. to its employees which can easily influence the interest and behaviour
of employees. Through this the employees show their willingness to put their maximum efforts
in achieving desired objectives. Various approaches and theories also play an important role in
encouraging employees to perform their delegated work.
P3. Evaluate how to minimize negative impact of change on organisation
Any changes made in an organisational structure will bring high risk which may affect
the culture and working environment of an organisation. For this the company need to form a
committee and panels which have main responsibility to analyse the risk element that occur
while making changes in Starbucks. The negative impact on an organisation while adopting new
changes and advancement in an organisation are mentioned as under:
Employee resistance: Adopting changes in an organisation will directly affect the
working environment which makes difficulties for their workers to perform. For example if a
company using new technology to record data then the employees takes time to understand these
advanced technology and find difficulty to record information using changed technology
(Goldstein, Sauer and O'Donnell, 2014).
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Expenses: The company can successfully implement new changes in working
environment only when they attain good financial position because implementing ideas into
actions requires huge investment. As the Starbucks attain brand image through which they can
easily raise fund from various financial institutions such as investors, banks etc. But small
companies may find difficulties in getting funds due to having low market share. Therefore
before thinking of adopting new changes the company need to analyse their financial capability
and accordingly implement new changes. If they fail to analyse properly then it will rise product
cost and reduce profit of company(Wedding, 2010). So it is the responsibility of managers and
leaders to arrange funds from different sources in order to meet company's financial needs.
Lack of support and failure: Lack of knowledge and communication to employees about
using adopted technology will bring negative impact on employee's interest and behaviour as
well as company's performance. Therefore it is the responsibility of managers and leaders to
create a platform where they can communicate their employees and ensuring them that adopting
changes will not affect their employability. They need to inform about the benefits of
implementing new changes to all employees which will increase the level of satisfaction as well
as productivity of company.
Morale: Focusing on implementing new changes regarding technology will bring
demotivation and dissatisfaction in employees. They feel afraid of losing their importance and
employability due to which their performance will also decreases. So it is important for leaders
and managers to ensure them about their employability and feel them motivated through
adopting different motivational programs (Groppel, 2011).
TASK 2
P4: Barriers which affect the change and affect leadership decision making strategies
Management has main focus to bring efficiency and productivity in an organisation
through making effective decisions after identifying and analysing the influencing factor that
make negative impact on the business operations. There are different factors which can impact
on leadership decision making process in Starbucks. For example if management department of
Starbucks need to implement new marketing strategy then leader should assign roles and
responsibilities to their team members on the basis of their skills and capabilities so that the
chances of getting positive results will be more. As working in a team, an individual mind set,
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cognitive biases will bring more differences among the team members through which the leaders
should found difficulties in achieving desired targets. As changes are not make impact only on
management and administrative department but also affects their sub-department such as sales
and marketing department, production department etc. which brings difficulties for workers to
deals with such complex situation arises due to implementing changes (Pelling, 2010).
Thus it is required for an organisation to have skilled and knowledgable staff which
implement changes in effective and specified format. As the company have different projects
which need to adopt some changes in order to get profitable outcome therefore in such situation
managers and leaders need to have specialised skills and knowledge who have ability to
understand and operate the business activities (McLoughlin, 2011). As sometimes adopting new
technology will be new for employees because of which they cannot understand that how such
technology will be utilized in profitable manner. Therefore the management of Starbucks may
found difficulties in implementation of new technology due to having less experienced
employees. Decision making process are influences by cost and budget. It is necessarily required
for manager to conduct training sessions and development programs to improve their skills and
knowledge through which employees can able to utilize available resources in an optimum
manner. For example an organisation want to expand their business capital through raising funds
from different sources such as loan, debenture. Thus it is required to evaluate the cost of capital
for pre-determined plan and find out the end result on cost and profit of product.
TASK3
P5. Application of suitable leadership style in organisational context
There are different styles of leadership which need to be adopted by an organisation to
achieve pre-determined determined goals and objectives in an effective and efficient manner.
Following are the some leadership style which lead company in effective way:
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(Source: Different type of leadership styles, 2017)
Autocratic: It is known as situational leadership which is followed with a purpose of
collecting feedback and opinions from employees of an organisation. It helps leader to know
problems and difficulties that their employees faces in working environment and thereafter
implemented corrective measures in order to resolve their issues in such an effective way that
will not harm the interest of employees.
Democratic: This approach is used to follow for the purpose of providing feasibility and
opportunities to take participate in growth of an organisation. The employees of Starbucks will
take benefits of showing their specialised skills and knowledge to achieve growth in an
organisation.
Laissez Faire: Through applying this approach the leaders of company provide
maximum freedom to their workers to perform their allotted work in their own way (NHS
England, 2016). Leaders just provide resources if needed otherwise they cannot interfere in their
work. This will bring self-motivation and satisfaction to their employees. Therefore this style of
leadership must be applicable in every organisation which allows employees to create new and
innovative ways to perform delegated task in more effective and efficient manner.
Transformational: In this approach, the leaders is required to have motivation and
communication skills through which they can communicate their employees regarding their roles
and responsibilities and motivate them to perform well. This style of leadership requires the
interference of leader in employee's work which bring dissatisfaction among workers. Due to
lack of freedom the employees cannot perform their delegated work in more effective and
efficient manner. This will demotivate employees which also affect their performance as well.
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Transactional: Under this style of leadership, the leaders are required to give proper
guidance and correct employees if their members fails to achieve desired targeted. The managers
and leaders of Starbucks need to set objectives which need to be achieved by their members and
if they can achieve desired targeted within specific period of time then the employees get
rewards and compensation from top authority and if fail then they may get punishment in terms
of deduction of salary etc. (Thomas, and et. al., 2013).
CONCLUSION
As per the above report it has been concluded that implementing new changes on regular
basis is essentially required for every organisation in order to sustain and survive in competitive
market world. Internal and external drivers of changes also play an important role in affecting
leadership, team and employee's behaviour. There are various approaches of leadership which is
essentially required to apply in an organisation in order to achieve desired goals and objectives
of an organisation.
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REFERENCES
Books and Journals
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