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After reading the above scenario I have concluded that this organization is using lasses faire leadership style. Employees are given a particular limit in which they can work and set their own rules independently, but outside their limits they cannot operate. People are given liberty to set their tasks in their own way and determine the methods to do such takes in the way they like. Also the dressing and the working hours are left in the discretion of those people. This is basic thing that Ricardo Semler brought in Semco after his father. He put the knowledge he gained in being a member of a rock band, especially the practicality that you cannot force the drummer to come for rehearsal when he does not want to, no matter what you do, unless he's him self motivated he wont be coming, same was the thing he imagined for the employees and made it work for the organization. He granted, his people, the liberty to choose their own timing and their own dressing so that they feel more motivated and their personal efforts are utilized to the full potential for the purposes of the organization, but some time they don't and for that purpose the minimal level of production is set, if anyone under performs he is fired immediately with out any excuse.
As soon as semler got hold of the company he changed many things, this included the change of leadership style from one extreme i.e. (autocratic style) to the other (laissez faire), and also a change in management style from but the most important change was the transformation of autocratic structure into entrepreneurial democracy or in other words the tall structure of the old organization into a flatter one. This idea was based upon three principals;
free flow of information
employee participation was kind of necessary these days , since they are the one who are going to do the main work, thus their input their feed back is required to know what happening at the floor and how to react to that , or how to make the process more efficient and cost effective.
Profit sharing is actually giving the people their right, of what they worked for and to make the right usage for the money, although supervision might be a good idea in this case.
Free flow of information is required, so that the person must know what is required of him in actual, what is his part in t achievement of the organizations goal.
All of these three are closely related to the motivation thing, the higher the motivation thing, the higher the commitment of the employees you have and thus the higher the productivity.
Semler soon started to layoff the managers his father had hired long time ago, and thus he came up with organization that was more prone to the changes in the demands of the consumers. He distributed the structure and had them under the supervision of a bunch of personnel, teams were framed in which not more than 150 members were included. Each member was supposed to do all the work from the start till the end and thus it improved productivity, efficiency and the error rate was reduced to almost zero. As a result Semler had a full attention his employees and their goals started to come inline with those of the organization and thus Semco has huge success in the coming years.
Although there are many leadership theories, which were framed to judge the main characteristics that the leaders have, but here we'll discuss the four types of them;
Burns depicted in 1978, what are now known as transactional leadership. This type of leader develops a close relationship with his subordinates after having an idea of their expectations. The leader has the authority to evaluate and further train the employees so as to achieve the required level of out put and after the output is achieved, the leader has the power to reward them according to their effectiveness.
This type of leader actually gives the power to its subordinates and enables them to perform better than they even themselves expected. Leader shows trust in the subordinates and helps in developing them by providing opportunities. This style is very much motivating since the employees get the empowerment to do the work... this style was actually worked out by Bass and he identified three main stages of this style;
Creating awareness among the employees about the importance of achieving the organizational goals and their contribution in achieving those goals
Motivating them to put organizational goals in front of personal goals or actually combining the personal with organizational goals
Fulfilling their upper level needs, like recognition, responsibility, authority etc.
It is more like a transformational leadership. These types of leaders have very attractive and compelling personalities, and this fact makes the people their followers. They have some great abilities like taking risk after calculating all the aspects, and they are very good at interpersonal skills. A charismatic leader is more result oriented and wants to achieve the set goal.
A charismatic leader adopts the following steps to motivate his subordinate;
changing the perception of the subordinate
providing the vision to the future
developing as a figure among the subordinates
giving rise to the self and group efficacy
There is actually no style which could be mapped on all the situations, different circumstances require different type of leadership style to be implemented, and that is what is explained by the situational theories.
If the work is of repetitive nature and there is no creativity involved then the best suited style would be autocratic.
If the work is of such type that it might require the input from the subordinates, and there is a need to get quick response from the customers then best suited style would be democratic'
Having a project, in which all the individuals are well trained, educated and now their participation in the objectives of the organization, the best style would laise faire. It would give the full chance to the employees to work up to their full potential, to get them polished and to get an opportunity to show their talent. This style brings about the most efficiency and productivity where the followers are experienced and know what they have to do.
In these respective situations following type of leader can emerge;
Directing leaders - Autocratic style
Delegating leaders - Only decisions and problem-solving
coaching leaders - Define roles and tasks, but seek ideas and suggestions
supporting leaders - Pass day-to-day decisions
All these styles are interrelated and none of them can be exercised continually in all the situations, to achieve the equally best result thus it depends upon the circumstances that which style is to be chosen and this is what that maintains a link between all the leadership styles. A few of those circumstances are particularly enlightened by the situational or contingency theory. In this era where every thing is over burdened with competition and every one is mutating to be the best, the leaders are facing the similar problem, along with able to exercise a different leadership style in different situations, a leader must be able to exercise Emotional Intelligence EQ. EQ is basically ability to assess and manage the emotions of one self. Since the leaders have to encounter with different situations and with the people from different regions and culture and back grounds, its the today's need that the leader must be able to deal with all of his work force without the gender discrimination thus this is where the importance of EQ comes in.
Leadership in SEMCO
When SEMCO was formed by Antonio semler it was more like an autocratic organization, with a lot of managers etc. things were done the hard way, they were dictated not motivated to do them. As soon as his son took over, he knew what he had to do to progress the organization in that period of recession. He restructured that organization and turned into a completely flat structure. He knew the fact that if one employee does not want to work; he cannot be forced to work and if he is his output won't be at the efficient level. Thus he started to motivate them all. He put the dressing and working hrs in their hands but he kept one rope in hand; that was the minimum level of production. Although he knew that the minimum level is kind of harsh thing, but he also knew that it was required to make up the boundary. This whole set up turned out to t=be the laissez faire leadership in which a bounty had to be set up in which the subordinates were allowed to roam freely; do their work in the way they want; dress like they want to; come to the office at the time they want to come; but a certain thing was required by them, an output, if they fail to provide that, or are inefficient in proving that they are actually letting the whole set up down.
Leadership requirements in SEMCO
A proper leadership is required so as to keep the employees from internal conflicts. Problems like diversity of background, culture, religion etc have to be dealt up nicely. A persistent problem is of gender discrimination that has to be dealt with great care. If the employees are well trained and are well experienced they wont be motivated when they are dictated, instead they would like to utilize their experiences and now a days employees don't want higher reward schemes but a say in the decision making, a part in deciding that the work should be performed. They want their higher level of needs to be fulfilled like responsibility, authority, recognition. Along with these issue there is a need of being up to date, knowing the best practices in the field and , for these issues to be dealt, the leaders of the Semco have to develop the following set of skills;
human resource skills;
Self learning; Managing time and stress
Managing individual decisions
Motivating and influencing others
Setting goals and minimum range
Recognizing, defining and solving problems
Semco is an organization where leader must have an extensive area of skills to build a well defined boundary around its subordinates, to structure the teams in such a way that they have the appropriate set of skills, and a similar set of skills have to be built to have a true leadership spirit whish is as follows;
cultural flexibility; it is particularly important because the world is turning into a global village, people from all around the world are migrating to seek their fortunes and thus is it very important to maintain harmony among them.
Communication skills; a leader must actually be able to communicate what is in his mind, and he must be able to interpret that the subordinates have understood that completely.
human resource skills; its actually the most important skill needed to be developed by the leaders of SEMCO, they must know that which person should be assigned to which task, which person needs to be given an appraisal and which has to be given a detention. It very important to asses the result produced by the human resource and then to act upon that results (rewards etc).
creativity is the vehicle of problem saving; in an organization like SEMCO where the structure is actually flat, creativity is the main weapon, but it can only be harnessed among the work force if the leader promotes it and practices it by himself. A leader should not only him self be creative but Alps he must foster that ability into his followers.
Self learning; this is where a difference can be made; kipping up-to-date and knowing whets happening in the current environment; which is shortest way to do things, and which is the new discovery, its helps in achieving both efficacy and effectiveness and thus promoting the productivity of that individual, but an individual must be motivated and pushed by the leader to maintain a state of self learning.
Managing time and stress; managers are often prone to stress, and lack of time, they have extensive responsibilities and need to fulfill them to maintain their position because if they dint there'll always be somebody to take over their position, and this truly puts them a lot of time pressure. A leader must be able to cope with this issue and live a happy, friendly environment in the organization. He has to manage himself and also has to organize the system in such a way that his followers don't feel the stress.
A similar case was quoted by semler s the following anecdote:
"Not long ago, the wife of one of our workers came to see a member of our human resources staff. She was puzzled about her husband's behavior. He no longer yelled at the kids, she said, and asked everyone what they wanted to do on the weekends. He wasn't his usual grumpy, autocratic self. The woman was worried. What, she wondered, were we doing to her husband? We realized that as Semco had changed for the better, he had too."
Managing individual decisions; a leader must build this capacity in his subordinates. Individual decisions are often hard to take, but at times when the situation gets worse or there is no time to communicate up-the-channel, it is must that the individual decision must be taken. This capacity can only be built if a proper opportunity is provided.
Motivating and influencing others; It is the main difference between a manager and a leader. Leader motivates where as the manager just enforces/orders. Semler learned this in the rock band that a drummer can't be forced to come on rehearsal when he doesn't want to come; no matter what you do. The only solution is to get him motivated, and this is why the true potential of the employee can only be utilized when the employee knows his part in the goals that are to be achieved.
Delegating; all the issues are often inter-related, If a manager wont delegate the work, he'll be overburdened and thus he'll be under time stress, and therefore delegation is one of the important things that are to be addressed by the leader. By delegating the work, leader gives a chance to the subordinate to get himself polished, to attain the state of mind at which he'll be able to do that work without any assistance and together with that it lets the leader to concentrate on larger bigger matters.
Setting goals and minimum range; A leader has to set the goal that is to be achieved by the followers, if there is no goal, there is nothing to chase. It is very important that the leader has the proper to skill to set the challenging goal for the subordinates thus they don't feel their capabilities being undermined but the goal shouldn't be too harsh to get them totally crumbled and for that matter a minimum acceptable output range is also defined, below which there is no mercy! It's the basic for the leader to have this skill.
Team building; Again the leader has the duty to frame out a proper team, which has the proper capabilities to do the task. Along with that it is also important that the team members have harmony among themselves and must know the purpose of them in that position and that is why leaders must be trained to have that skill.
Managing conflict; where there is competition, there are conflicts. But an organization can't continue to function if these conflicts are not handled tactfully and the matters are properly dealt and disposed off. Again the responsibility rests upon the leader.
Self-awareness; it is important that the individual must know about things going around him, about the things that happen in his field and for that interest the motivation and a pull from the leader is required to make the subordinates gather this skill.
Recognizing, defining and solving problems; Competition, though fruitful, sometimes leads to problems and they need to be solved to keep the show running. Another problems than caused by competition are also covered by this heading but it one ends up at the post of leader since has the one to develop the skill to recognize the problems , define them and deal with them tactfully.