Table of Contents
This report will clearly evaluate the leadership styles of two leaders, Partrik Fagerlund, the CEO and Co-founder of Widespace and Jules Coleman, the Cofounder of Hassle.com. This report will also compare the leadership styles followed by the two leaders. The Business model used by the two organisations and their generic strategies used are identified and is discussed in the report. The organisational culture is a vital factor for any organisation. The organisational culture for the two organisations are discussed and a cultural web is made for the two organisations (Widespace and Hassle.com). This report will also discuss about the acquisition of Hassle by Helpling and the reasons for the acquisition.
A leadership style is a unique style in which the leader commands his subordinates to accomplish a particular task, motivates the employees and implementing certain plans. There are various leadership styles which are followed in organizations. They are as follows:
- Autocratic leadership style
- Democratic leadership style
- Laissez-faire leadership style
- Transactional leadership style
- Task oriented leadership style
An autocratic type of leader is a person who takes control over the entire employees. In this type of leadership, the employees have very limited opportunity in giving suggestions for the decision-making process. Most of the employees don’t like this type of leadership. The employee tends to be stressed out and tensed to work with leaders who follow this type of leadership style. As a result of this there will be increased absenteeism and staff turnover ratio in the organisation. However, this type of leadership is effective in certain organizations where unskilled labours works, like manufacturing industries. In these type of organizations, the advantages weigh over the disadvantages of this leadership style.
An autocratic leader tends to motivate the employees less when there are any changes like environmental changes, technological change, product change etc. inside the organisation.
A leader who follows this type of leadership takes opinions and suggestions from the employees and takes those into consideration while taking decisions. This is an appropriate form of leadership for organizations where safety problems arise and in organizations where a large amount of money is involved.
The leaders who follows bureaucratic style of leadership tries to motivate the employees when there are changes like environmental change, size change etc. The leader tries to motivate the employees in the form of rewards, appraisals and incentives to adapt to the changes.
It is a leadership style where the manager observes that members of the group are working well on their own. In this type of leadership the leader gives all authority and power to the employees and they must determine goals, make decisions, and resolve problems on their own. When an employee works under a leader who follows Laissez – faire leadership style, the employees can improve their communication skills, teamwork skills and also it increases the responsibility of the employees.
When there are any changes happening inside the organisation, mostly the employees try to adapt to the situation and there is only less need of motivation.
The transactional style of leadership starts with the idea that team members or the employees agree to obey the leader totally when they accept to perform a particular task. The “transaction” is usually the organization paying the team members in return for their effort and compliance that they have done for the organisation. Team members can do little to improve their job satisfaction under transactional leadership. The leader who follows this type of leadership could give team members some control of their income or reward by using incentives that encourage even higher standards or greater productivity. The Transactional leadership is really a type of management, not a true leadership style, because the focus is on short-term tasks rather than focusing on the long term tasks. It has serious limitations for knowledge-based or creative work; however it can be effective in other situations
Leaders who follows transactional style of leadership tries motivating the employees by giving them rewards in the form of additional paid leaves, coupons etc. And also by giving incentives when there is any change happening inside the organisation.
Leaders who follow this type of leadership tend to focus only on getting the job done, and they can be quite autocratic type. However, because task-oriented leaders don’t think much about the well-being of their teams, this approach can suffer many of the flaws of autocratic leadership, with difficulties in motivating and retaining staff.
Even though the leaders who follow this type of leadership dose not tend to motivate the employees much, some tries motivating the employees by appraisal, additional rewards and incentives.
Entrepreneurial leadership can be defined as the ability of a leader to manage and lead a group of people by taking risk, accepting responsibilities, spotting new business opportunities, innovating to bring changes and creating values to meet the organisational requirements. There are mainly six character traits that are exhibited by entrepreneurial leaders. They are:
- Need for independence
- Need for achievement
- Internal locus of control
- Moderate risk taking
- Drive and determination
- Creativity and identifying opportunities
Need for independence
Entrepreneurial leaders are people who likes to do thing by themselves and be independent from others. Entrepreneurial leaders are usually deep thinkers and are self-motivated and they make up their own mind. They tend to succeed in the doing things themselves without taking any external assistance.
Need for achievement
Entrepreneurial leaders are people who wants to be recognised in their life. Entrepreneurial leaders usually set difficult tasks and then works hard to achieve these tasks. These people are highly motivated themselves and keeps on working for better results.
Internal locus of control
Entrepreneurial leaders usually have very high level of self-confidence and believe in themselves. These people believe that they have the power to control their future.
Moderate risk taking
Entrepreneurial leaders are risk takers. They usually take calculated risk and comes up with new and innovative ideas to develop the business. These people also take the responsibility of their own actions.
Drive and determination
Entrepreneurial leaders are self-motivated people and they are driven by themselves. They do not require an external force to push them to get motivated. They are self-driven people. These people always show passions towards the things that they do.
Creativity and identifying opportunities
Entrepreneurial leaders foresee the future and identify the opportunities coming up in the industry and uses the opportunity wisely by bringing new innovative ideas to make some change.
Some of the attributes of an entrepreneurial leader is given below:
- Entrepreneurial leaders possess both entrepreneurial characteristics and leadership skills, Wherein the leaders usually direct and manage people to achieve common goals
- Entrepreneurial leaders take high risk to develop and manage their business, Wherein the leaders take less risk to manage the business
Patrik Fagerlund is the co-founder of Widespace AB and is the CEO of the company. Patrik Fagerlund follows Laissez-faire leadership style.
From the case study given, it is evident that Patrik Fagerlund was not interested in following the formal processes in the organisation and considered the cultural paramount more important than the processes. Widespace’s culture is characterised by freedom under responsibility. The employees in the organisation was given the freedom to work by their own ideas and also to engage and enjoy their time together to work proactively to bring new ideas and solutions. There was also not much hierarchical power within the organisation. All doors of communication are open to the employees. As per Patrik Fagerlund, the employees should use their own initiative instead of taking orders from the higher authority, and feel ownership of the work and the company. Patrik Fagerlund encouraged his employees to develop their organisational skills and change according to the needs of the industry. This was beneficial for both the employees and also to the organisation. This approach of Patrik Fagerlund was motivational for the employees and the employees considered the organisation to be their organisation and worked responsibly for the success. Patrik can be considered as an entrepreneurial leader as he is a moderate risk taker, possess internal locus of control and need for independence.
Jules Coleman follows Transformational leadership style. She was a person who had very high need for independence and wanted to do something by her own. She was able to spot the right opportunity in the market and was able to make use of the opportunity very effectively. Jules Coleman is also a person who is capable of motivating and encouraging incompetent people to build an effective and efficient team. There is also flexible working time for the cleaners working in Hassle.com. The Cleaners can do their work whenever they are free to do the work. This is one of the main advantage of Hassle.com, which attracted a lot of cleaners to work for the company. Jules Coleman also exhibits autocratic leadership style to some extent. In the organisation (Hassle.com), the employees (Cleaners) do not have much opinions in the functioning of the company. Most of the important decisions are made by the top management and the employees has to follow those instructions given by the leader and the top management. The wages of the cleaners are decided by the organisation. As a result of this there is a high number of employee turnover ratio in the company. Most of the employees (Cleaners) who has registered with Hassle.com, became inactive in the website over a period of time. But still there is high number of new cleaners coming into the company and registering with hassle.com. This type of autocratic leadership style of Jules Coleman is suitable for an organisation like Hassle.com, Which does not require much of Skilled employees. Jules Coleman can also be referred to an entrepreneurial leader to an extent as she had need for independence and internal locus of control.
Both the leaders are following the best suited leadership style for their organisation, which is the reason for the success of these companies. Even though there are some similarities in the leadership style possessed by the two leaders, they also have some differences in the leadership style of Patrik and Jules. Patrik is not much concerned about his hierarchical power in the organisation and gives more importance to the culture of the organisation. But Jules enjoys certain hierarchical power in the organisation and exhibits authoritarian leadership at some points.
A BUSINESS MODEL can be defined as a company’s plan for generating revenues and profits. It includes the components and functions of the business.
Porters generic strategies explains how a company achieves competitive advantage in its chosen market. There are four generic strategies according to potter. They are:
- Cost leadership
- Cost focus
- Differentiation focus
Hassle.com is a company that helps customers to search and find cleaners in the surrounding areas with the help of postcode. Hassle.com helps the customers to find cleaners in the surrounding at an affordable price. The company runs on an online website platform, where the customers can find the cleaners and find the reviews of other customers before selecting the cleaners for the job. Cleaners are required to go through a simple registration process to join the Hassle network. There is a very high flexibility in the working time for the employees. The cleaners can work according to their free time. The Cleaners can also go through the reviews of the customers before they accept the offer. This becomes an effective platform that connects the customers to the cleaners. There is a common per hour wage of 10 pounds an hour (now changed to 12 pound an hour). The company charges a 10% commission on the wages from the cleaners for using their platform.
Hassle uses both Differentiation and Cost leadership strategy. Hassle has set a common wage for all the cleaners registered in the website. All the cleaners in Hassle charges 10 pounds per hour for cleaning. Of the total cleaning wages charges by the cleaner, 10% is been charges as a commission by Hassle for using their platform. It is evident that Hassle is the Cost leader in the market by the example given below.
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An attempt was made to find cleaners in the surrounding using the same post code and the same criteria’s including the time for cleaning in Hassle.com (now www.helpling.co.uk ) and www.taskrabbit.co.uk. It was found that task rabbit showed cleaners in the surrounding areas, but with different pay scale varying from 20 to 40 pounds per hour. Their pay scale was much higher when compared to Hassle, where all the cleaners charged a common wage of 12 pound per hour (Previously 10 pounds per hour). This clearly shows that Hassle.com is the Cost leader in the market. The below given screenshot will show the price difference in the two websites.
Figure 1 Screenshot of booking page in Taskrabbit.co.uk
Figure 2 Screenshot of booking page in Helpling.co.uk (Previously Hassle.com)
A value proposition can be referred to as any idea or innovation or any service that attracts a customer to a particular company. In other words, value proposition can be defined as a statement that a company uses to justify why the customers should use their product or service in comparison with the similar alternative solutions available in the market. The value proposition is mainly used to target and attract the potential customers of the business and convince them to use the product or service of the particular business.
The main value proposition that Hassle.com offers the customers are to be in their comfort zone (home, office or any other place) and find a local cleaner in the surrounding with the use of the website in just a few clicks. The affordable cost of cleaning and the professionalism of the cleaners also adds up to the value proposition of the company.
Hassle.com is a company that has grown rapidly over the period of time. The company has grown from 5 employees to 50 employees in a short span of time. Hassle was also able to attract external investors to invest in the company to expand their business (they got $6 million in 2014). The satisfied customers and happy employees are the main resource for the company. The employees (Cleaners) feels happy to work with hassle.com because of the flexibility of work. The value chain is as given below:
|VALUE CHAIN ANALYSIS|
|HUMAN RESOURCE MANAGEMENT||
|MARKETING AND SALES||
|Resources and Competencies||Valuable||Rare||Imitable||Organized||Overall|
Widespace is a technological company that creates tools for advertisements in mobiles. Widespace currently operates in nine countries in Europe and has a development centre in Bangladesh.
|TYPE OF BUSINESS||Mobile advertisement company|
Widespace has a differentiation focus strategy. The Company was started in 2007, almost at the same time when the iPhone was released. The company did not experience much growth in the initial stages due to the unawareness of this opportunity to advertise through mobile phones. It took a lot of time to convince and make the clients understand the opportunity they had. Widespace had various departments inside the organisation and each department was responsible for different functions in the organisation. At later stages Widespace started recruiting people from the media background, rather than recruiting the people from the technological background. This strategy was used by widespace because the people from media background could easily explain and convince the clients about the business. Widespace also ensures that they advertise only on controlled sites to avoid the customers perceiving bad about the advertisements of the clients. They were always working to promote the business of the clients without spoiling their brand image.
Widespace business was a radical innovation to the advertising industry and they became different from other competitors in the market. The main advantage of this idea was to reach out to a large population with a shorter time span. This made the business successful.
Widespace uses a Differentiation Focus strategy to run their business. Widespace main target was large multinational companies. Some of the main multinational companies that worked with Widespace to promote their business are Volkswagen, Coca Cola, Audi, Unilever, P&G etc.
Widespace is the industry leaders in the mobile advertisement industry. Advertising only on controlled applications and website is one major value proposition for Widespace. They ensure that the advertisements are not made on website that contains any type of violence, pornography etc. Another main reason that attracts major clients to widespace is that this method of advertisement can reach a very large population in a very short time and that too on the targeted audience. They have developed various formats of advertisements that adds value to the clients. The clients can choose from these formats according to their advertisement needs. Some of the formats of advertisement introduced by wide space are as follows:
The Splash – This format of advertisement is a full screen advertisement that lasts for about 3 seconds followed by a link in the screen which the users can use to know more about the product or service.
Video Banner – This format allows to advertise using videos like television advertisements directly in the mobile applications.
Store locator – This format of advertisements gives a link in the advertisement page on which the viewers can click and find the nearest store using the GPS technology in the smart phones.
Calendar – This format of advertisement enables the customers to add events on their smartphone with just a click on the advertisement and then later will get a reminder on the events.
The swipe – This advertisement format enables the users to swipe through the advertisement and see unlimited number of pictures. The users can also interact via speech with the advertisement.
The founder himself is one of the most important resource for the company. The experienced and skilled employees in the company knows how to target the customers for the client company. Widespace also has a well experienced and trained sales and media team, who promotes the sales of the company by convincing the clients about the new way of advertisement. The value chain analysis of Widespace is given below.
|VALUE CHAIN ANALYSIS|
|HUMAN RESOURCE MANAGEMENT||
|MARKETING AND SALES||
|Resources and Competencies||Valuable||Rare||Imitable||Organized||Overall|
The Bowman’s strategy clock is a model that shows the various strategic positions and how a specific product/service should be positioned based on two dimensions (Price and perceived values) in the market to give the product/service the maximum competitive advantage in the market.
Figure 3 Bowman’s Strategy Clock
Figure 4 Position of Hassle and Widespace in Bowman’s Clock
Hassle.com is positioned at number 3 of the Bowman’s clock which is hybrid strategy. This is strategy which includes both Differentiation strategy and Cost leadership. Widespace is positioned at number 5 of the Bowman’s clock which represents the Differentiation focus strategy.
Organizational culture is a set of assumptions, values and believes which rules or governs every individual behaviour inside any organization. The organizational culture strongly influences the employees in an organization.
Types of organization Culture
- Power culture
- Role culture
- Person culture
- Task culture
In power culture the head of the institution makes the decisions for the organization and most of the power lies in his hand. As there is only one or a few people involved in the decision-making process, the decision making becomes faster. This culture is usually followed by small organizations with a very few number of employees.
Role culture is mainly based on rules and predictable operations within the organization. Organizations which follow role culture tend to be bureaucratic. In organizations following these structures, the employees know what their roles and responsibilities are and hence it is a highly controlled structure. Due this the efficiency increases. In this culture, an individual’s power is determined by the position.
Task culture is formed in an organization when teams are formed in an organization to perform some specific task. The employees become more innovative. The efficiency and creativity of the employees increases when this type of culture is formed. The expertise in the team has the power of decision making.
Organizations following this type of culture consider each employee important and functions forward to give them work. In this type of culture the individuals are superior than the organization and power lies in each individual. It is difficult to uphold and follow this structure. This type of culture is normally followed by professional firms.
Johnson and Scholes in 1998 described the cultural web as identifying different elements that influence the organisational culture or describes the organisational culture and the Paradigm explains what the organisation is about and its values.
Figure 5 Cultural Web Framework
|Jules Coleman is the CEO and cofounder of Hassle.com. Jules Coleman learned herself how to design and create a webpage to start the business. When the company initially started they stated the slogan “the one stop solution to all your service needs”. But then they realised that for a small start-up like then, it was difficult to develop all the service at the same time as it requires large amount of money. That is when they started concentrating on the Cleaning service, which had the highest number of customers. Hassle.com then became the world’s largest marketplace for independent domestic cleaning in the UK. The website now allows people to search and find a local cleaner by using the postcode by going through the reviews.|
|The slogan the company used when they initially started was a main symbol for the company- “The one stop solution to all your service needs”. Jules Coleman is a major personality in the organisation. She is one of the key factors that lead the company to success.|
|The power lies in the hands of the leaders of the company. Alex Depledge and Jules Coleman are the key leaders of the company and these people instruct the other employees in the organisation to do specific tasks and improve the skills of the employees.|
|ORGANISATIONAL STRUCTURE||Hassle.com has a flat organisational structure. The company was not structured in the beginning stages but later became structured. They had a very few layers of managers in the organisation.|
|CONTROL SYSTEMS||The cleaners who register in Hassle.com are verified by the company to ensure the safety of the customers. The platform gives both the customers and the cleaners the option to give their feedbacks and reviews on the website that would help to improve the service.|
|RITUALS & ROUTINES||The customers who needs a local cleaner can go to the website and search for the cleaner using the postcode of the area and then select the cleaners based on the previous feedbacks and reviews. The cleaners who wants to join the Hassle team of cleaners can register with the website by doing an online application followed by a few simple steps including the identity verification.|
|Hassle.com is a company that gives importance to the organisational culture. Alex Depledge and Jules Coleman, the cofounders of the organisation are the main motivators in the organisation who motivates and inspires the other employees in the organisation. The Company helps the people who are looking for a local cleaner at an affordable cost to find a cleaner in the surrounding and also helps the cleaners to find customers easily using their website. The Company acts as an intermediate platform between the cleaners and the people looking for a cleaner. The company generates revenue by charging a commission of 10% from the cleaners for using their platform.|
The organisational culture is important for any organisation and is a vital part of the organisation. Similarly, the organisational culture of Helpling has a great impact on the success and functioning of the organisation. The flexible working hours for the cleaners is one of the main reason for the success of the business. The cleaners do not feel much stressed during work and feels happy to work with Hassle.
|Widespace is a company that mainly does advertisement for clients through mobile phones and tablets. This company was founded by Patrik Fagerlund in 2007. Patrik was an employee of Ericson before he started the company by himself. The company had slow growth in the initial stages as mobile phones were not so much popular at that time and it took the company a lot of time to convince the clients about the opportunities and advantages of this type of advertising. The leaders of the organisation did not give much importance to the formal systems inside the organisation but rather they focused on the organisational culture. Every employee in the organisation had freedom to do the work their own way and take responsibility of their work. The Company actually started growing from 2012. They started employing people from media background than from the technological background that enabled to make the clients convinced about the opportunities that they had. The new employees were trained in the same stressful environment of work to make them aware of the working conditions and to understand the culture of the company.|
|SYMBOLS||Patrik Fagerlund has tried his best to make the company one of the best places for the employees to work, and a place where the employees enjoy working. There is also space for recreation in the office. All the office of Widespace looked similar and there were quotes based on values printed on the walls, that motivated the employees in the workplace.|
|POWER STRUCTURE||There is no much hierarchical power involved in the organisation. There is good communication between the top management and the lower employees in the organisation. Even though the power lies in the hands of the leaders, mostly the employees are also involved in the decision-making process in the company.|
|ORGANISATIONAL STRUCTURE||Widespace did not have any organisational structure in the initial stages of the growth of the company. The roles in the organisation was created due to needs in the organisation. At later stage, they employed experienced managers to monitor the employees and the managers’ report to the head office in Stockholm.|
|CONTROL SYSTEMS||Widespace always make sure that the brand image and reputation of their clients are protected. They advertise the contents on controlled websites and applications. Widespace avoid posting advertisements on sites that contains any type of violence, pornography etc. to avoid the spoiling of the brand image of the clients.|
|RITUALS & ROUTINES||Rituals and routines in the company includes meeting the clients and developing the advertisements for the clients. New employees are recruited and trained in the company at the same stressed environment for the new employees to understand the work environment and the organisational culture.|
|Widespace has a unique organisational culture. The employees are given freedom to do the work their own way and take responsibility of the work. There is a similar and motivate environment in all the widespace offices. All the employees are free to communicate their ideas with the top-level managers and there is very less hierarchical power existing in the company.|
Organisational culture in widespace is very unique. They give more importance to the organisational culture rather than the formal systems in the company. There is not much of hierarchical power in the organisation. The employees are free to do the work their own way and take responsibility of the work. The employees feel that it’s their organisation and works enthusiastically for the success of the company.
Acquisition can be referred to as a corporate activity in which an organisation buys all the shares or a part of shares of another company to get control of the firm. An Acquisition is said to happen when the organisation buys more than 50% of the shares of the target company. The Acquiring company buys the shares and other assets of the target company so that they can make decisions in the acquired company without taking the opinions of the stakeholders of the acquired company.
Hassle.com is an online booking and payment platform that enables the customers to search and find the best cleaners in the surroundings using the postcode. The company was founded in February 2012. The cleaners in Hassle.com charge a common rate of 10 pounds an hour and 10% of the earnings are paid to the company. Some general information about the company is given below.
|TYPE OF BUSINESS||E Commerce|
|HEADQUATERS||Vauxhall, London, United Kingdome|
|AREA SERVED||United Kingdom, Europe|
|FOUNDER (S)||Jules Coleman, Alex Depledge, Tom Nimmo|
|FOUNDED IN||February 2012|
Helpling is also a online platform that helps the customers find vetted cleaners in the surrounding. The company was founded by Benedikt Franke and his friends.
- Hassles founding team- Jules Coleman and other cofounders found that the company requires huge potential to grow, but they did not have the sufficient financial resource to develop the company.
- They started attracting external investors to invest in the company, but this was not all needed.
- Jules Coleman also possessed the characteristics of a serial entrepreneur and thus decided to sell the company to Helpling and Start a new business.
Helpling decided to agree to the deal of acquiring Hassle.com due to various reasons. Some of the reasons why Helpling acquired Hassle.com is given below:
- Hassle.com was the market leader in the UK, the market to which Helpling was planning to enter into. This is the main key reason for acquiring Hassle.com
- Both the organisations were of similar size and there was no much difference in the leadership styles and the organisational culture, which is favorable for the acquisition.
- It takes time for a company like Helpling to enter the market and gain a brand image in a huge market like UK, where Hassle.com is already the market leader.
- It takes a lot of time for Helpling to emerge in the market and is also highly cost involved.
- Acquiring Hassle.com, a company with good customer base, brand recognition and vast network of cleaners would enable Helpling to enter and emerge into the market very easily, quickly and at a reasonable cost.
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