Leaders Role In Chaotic And Complex Organizations Commerce Essay

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A leader needs an entirely different attitude or mind-set in leading a complex organization. Hierarchy works in these situations only if each level is doing somewhat diverse and definite. But this is not possible in today's complex environment because of interdependences in complexity. In today's business world we need an organization which is interdependent and networked and it can be possible by decentralization, early awareness system, core processes and simplifying values and vision. These networked organizations need a leader who provide different leadership styles and roles as well as lead the organization's different parts to work collectively to earn value.

The leader need to link and form thoughtfulness of separate units, teams, and managers in the interdependent structure, else confusion starts to grow. Leadership should be predictable not be repetitive. People's skills and adaptability are the backbone of the leadership in a complex organization (IMD, 2007)

What is complexity in organisation?

Complexity is often considered the latest business buzzword - it reflects the current common reality but not a lasting one. Leadership is a real challenge in the complexity concept but when all things are connected how can anyone concentrate on one thing? This is a good question but with a few answers. New business models, technologies, and processes become more complex. The reason behind this is that new features are added normally but subtracted rarely. (IMD, 2007)

In today's business environment individual must recognise the complex circumstances and work by exploiting these conditions in favour of the organization. These complex situations can be used as a pathway of seeing the changes in the business by a leader or management persons. It depends on the leaders how they tackle the difficult situation either by understanding and starts with the complex solutions; business approaches each complex solution easily or fails to understand the situation, business fails to do so.

Here are two of the reasons for complexity in organisations:


Due to diversity global organizations face complex situations inside as well as outside the organization. Inside the organization leaders must manage and response to more deviation in simple and wide ranging financial objectives, diversity in the management system and teams and different business models for different units in organization. There is higher diversity outside the organization: various customer needs; different economic and legal environment; overabundance of investors with different claims and different tactics for market. Almost each organization faces this situation. (IMD, 2007)


Everything in an organization is related to everything else and effect is sensed more quickly. Corporate governance, top management, financial flow, reputation of organization, value chain flow issues have reached to next level in interdependence. Due to this it become more visible to effects of value chain flow through mistakes, shocks, or trends. Opportunities for globalization are created by interdependence but it also raises difficult challenges. (IMD, 2007)

Leadership core skills and competences:

To succeed in a chaotic and complex organisational environment the exceptional leadership skills are essential. Whether an individual is an employee or own a business, one has to look forward to make an impression to achieve the target. The leadership style is critical to reach the targeted objective. It can be said that leadership skills plays a vital role that paves the path to success in complex business world. Now this paper will look into few of the competencies that need to be possessed by a leader to deal effectively in the above mentioned situations:


For a leader, adaptability is the way of reacting to the changing condition effectively in a business environment. Everyone in organizations faces the challenges due to adaptability, but leader are keen to face and sort it out with an effective plan of action. (Moment, n.d.)

Leaders come and go, their decease generally fasten by fruitless efforts to keep stability and to retain the order. Certainly, the strategies that worked previously by helping the organization to adapt change may work poorly now if competitors grasp this opportunity to originate new market or if changes occur in social economical or technological forces. The leadership requirement of an industry changes from entrepreneurial to marketing, marketing to cost control, and finally from cost control to cash flow management when the industry grows. (Allio, 2009)

Moreover, even a good leader take wrong decisions or predict wrong discontinuities. Even some industries stick to the old principles they are mainly eager to Darwinian extinction. The alternative is to change all tactics with stability and consider tact of adaptability and flexibility. The organization everywhere likes the feel of security which developed due to stable system when all the changes are slow. James O'Toole characterized adaptability as the "ideology of comfort and the tyranny of custom". (Toole, 1995)

In an organization big change is hard but constant changes are harder.

The reason is that organizations primarily grow by choosing some strategy that works and then give them internal support with the help of the resources. And when outcome finally diminish, the organization starts to invest more resources in those failing strategies and all this things get support by the staff who don't find any substitution. In sociological terms, described by psychologist Kurt Lewin and others, a given system is frozen in particular state.(Lewin, 1999) To move to a new state, leader must first unfreeze the system, move it to a new position, and then apply appropriate forces to stabilize it, sometimes an entirely new business model is needed. Only few have mastered the process of managing change. John Kotter proposed an eight step process that includes establishing a sense of urgency, achieving short-term wins, and consolidating the improvements. (Kotter,1996)

People skills

People skills can be classify as a term to indicate four sets of skills:

The skill of effective communication:

"Communication is a process of conveying information and meaning" True communication takes place only when all parties understand the message (information) from the same prospective (meaning). So in order of productive a leader must be able to communicate effectively to everyone. (T Aeppel, 2007) Communication skills are really essential for leaders in an organization. For an organization it is a disadvantage if a talented leader lacks the skill of turning opinions into useful contributions. In a competitive environment to get a new client ability to make eye-catching and effective presentation is really important.(Peter A Kay) As leader spend around 40 % of their time in communication.(R. Simpson,2006) Leadership is all about influencing the others and we do so with the help of communications. Leadership is also about building relationship. (M J Gelfand, 2007) So there is a positive relationship between leadership performance and communication competency. Now organization trained their employees for better communication so to influence others to get their jobs done. (P J Frederickson,2006)

Motivation skills

To get the best out of those who work for you and with you, the leader must have the ability to motivate. Leaders are generally expected to motivate others to get the job done efficiently. " motivation is anything that affects behaviour in pursuing a certain outcome". (R Cropanzano,2007).The pursuit of happiness and satisfaction is fundamental to motivation. (T A Wright, 2006)cited in (Achua and Lussier, 2010)

Need Motive Behaviour Consequence Satisfaction or Dissatisfaction


(Achua and Lussier, 2010)

So if you want to motivate someone give people what they want and they will in turn give you what you want that creates a win-win situation. Leader should function as a synergizing force, combining and realising energies and capabilities among those they lead. The leader should develop the ability to create a level of achievement which is ahead of the imagination of the individual, teams, groups and organization. Moreover to this leader should negotiate conflicts, heal the wounds by changes in organization and also guard the organization environment from the crises.(Murphy, 1996). All this may call for such personal qualities like initiative, enthusiasm, self-assurance, self-confidence, integrity, trustworthiness, the capacity to face challenges, risk taking behaviour, and commitment. (Tony Morden, 1997)


Leadership is about winning hearts and minds. To do so it is essential to win one's own (David Gilbert-smith, n.d.). The individuals who are unaware of their values are dangerous to those around them. Leaders who are self-aware are more likely to succeed than those are not. Those who are aware are professed by others and have their greater impact on others. (Gilbert, 2005). Most of us think that we are better than what we actually are because of intent. Unfortunately someone who can read mind can be a way for problems for us when we living our lives on assumptions and intent.

Inorganizations co-workers can only judge leaderby his behaviour which sometimes leads to miscommunication and confusion. A leader cannot assume that everyone around them know how, why and what to do. A leader should be self-aware in order to create a healthy bonding with the co-workers. It can be done by finding personal strengths and weakness and then determine the way to overcome them. However if leaders don't see their mistakes then someone around him see and that can be a harmful condition. So self-awareness is a very important competency of leadership. (Moment, n.d.). It describes those leaders who have an exact understanding of their strengths and weakness. Self-awareness can also be related to the self-control and pressure tolerance and can also be concluded from how someone handles the challenging and difficult situation. (Anon, 2003)


Every organization needs a vision to set its way to success and a good leader can tune into that vision and find success for the organization as well as for him-self.(Moment, n.d.) Charles Handy associates ability to develop vision with the effective leader behaviour. According to him for a visionary leadership to be effective some conditions need to be fulfilled

Vision has to be different.

Vision must make sense to others.

Vision must be understandable and capable of sticking in people's mind.

The leader must exemplify the vision by his behaviour and evident commitment.

The leader must remember that if the vision is to be implemented it must be one that is shared.

(Handy, C, 1992)

But According to Kotter what matters most about a vision is not its uniqueness but rather how well it meets the needs of shareholders, customers, and employees and how easily it can be turned into a strategy which improves the organization's effectiveness.(Kotter, J P, 1988)

According to "vision is seeing the potential purpose hidden in the chaos of the moment, but which could bring to birth new possibilities for a person, a company or a nation" cited in (John Adair, 2003)


Decisiveness is an important skill in leadership. The decision what a leader wants to make has a straight impact on how he is accepted as a leader. Decisiveness can be linked to valuation of interdependence. Decisiveness has to do with a preference for quick over slow ones. Interdependence has to do with the ability to self-directed and self-controlled in one's thinking. So the people who think themselves as independent thinkers would be seen by their direct report as decisive (Anon, 2003). Decisiveness is sometimes conspicuous because of which it becomes problematic for leaders to impose their decisions. Everyone has some fear in them for the incorrect decisions and conspicuous. In spite of this, other face is worse. Although leader becomes less conspicuous by staying indecisive, the chances are higher of seeing more serious consequences (Moment, n.d.)

Collaborative skills

In today's complex environment,technology has opened a new opportunity for working and communicating in organization. Because of this the whole business environment is benefited within business across all departments, both internally and externally. It is an important skill if a leader develops a system where everyone can play a vital role by contributing different ideas.


To be an effective leader in a complex environment it is important to develop certain skills. The adaptability can be hone by some ways

Developing ways to anticipating problems

Making backup tactics to handle those problems

By making an open mind set to learn constantly and quickly.

Adopting a method of flexibility

To gain the respect of the fellow employees and be an effective leader a balance between adaptability and consistency is important. The vital thing in any business is the final result so result-getting attitude must be maintained. A good leader will eager to know the potential of the fellow employees so he uses that potential to increase confidence and get desire results.

It is essential to develop a sense of self-awareness. People will return more positively to one who produces respect. The sense of self-awareness can be improved and in improvement 360-degree feedback can be helpful. By using feedback, one can understand their positives and negatives and it also give them a chance to form and develop a group for the better future of the organizations. It is necessary for leaders that they know what they are doing and how they going to do that.

To be an effective leader it is important to develop strong motivational skills. If a leader don't appreciate individual for his or her work it's like demotivating them and the result is that only negative feedback will be given. In this type of environment employees aren't motivated and less eager to achieve high performance.

It is important to create an environment in which people feel they are treated equally and as peers other then only subordinates. Leaders must know how to handle the negative situation and must learn to deal with the different and difficult conversations.