The Psychology Of Organisation In Business Commerce Essay


Human beings are continuously engaged in some activity or other in order to satisfy their unlimited wants. Everyday we come across the world 'business 'or 'businessman' directly or indirectly. Business has become essential part of modern world. Actually business is an economic activity, which is related with continuous and regular production of goods and services for satisfying human wants.

'The regular production or purchase and sale of goods undertaken with an objective of earning profit and acquiring wealth through the satisfaction of human wants'- Stephenson 2011

Leadership is a process by which a person influences others to accomplish an objective and directs the organisation in a way that makes it more cohesive and coherent. Leaders carry out this process by applying their leadership knowledge and skills. Actually good leaders are made not born. If someone has the desire and willpower, he/she can become an effective leader. Good leaders develop through a never ending process of self-study, education, training and experience. As a good leader you inspire your workers into higher levels of framework, there are certain things you must be, know and do. These do not come naturally, but are acquired through continual work and study. Good leader are continually working and studying to improve their leadership skills; they are not resting on their laurels.

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The psychology of organisation in business and leadership relates each other weather the organisation is for employees and staff or affectively working as a team.

Leadership is important in business because all the people are silently asking to be led. If you want to learn how to run successful businesses then learn how to lead. Business is a collection of people working for same cause, and a leader is required to define that cause. Growth of a business will only come through the time and talents of others. As a business owner and entrepreneurs, the sooner you realize this, is better. Using the time and talents of others will allow you succeed in larger projects faster and with a higher degree of quality.

A small business is also called mom and pop store, is a business that is privately owned and operated, with a small number of employees and relatively low volume of sales. Small businesses are normally privately owned corporations, partnerships, or sole partnerships. The legal definition of 'small' varies by country and by industry, ranging from fewer than 15 employees under the Australian Fair Work Act 2009, 50 employees in the European Union, and fewer than 500 employees to qualify for many U.S small business administration programs. Small businesses can also be classified according to other methods such as sales, assets or net profits and in many countries small businesses depend on the economic system in operation.

Small business leadership can be a tricky endeavour. There is much more involved than simply performing the various tasks involves in running your business day to day. A leader must also set the tone and direction of the business and the encourage others to do their best. Never make the mistake of believing that you must have a large team to be a leader. Even small teams need someone to point the way.

We have a great example of small business owner in New Zealand usually known as 'Mad butcher", by now you might have guessed name of person whom I am talking about? Yes, Sir Peter Charles Leitch who owns the chain of 37 butcheries around the New Zealand and here are some of his leadership qualities-

Collaborative this is one of the most important leadership quality found in Sir Peter Leitch. According to that it might seem like a successful small business owner would be the type to micro- manage every detail. But the guardian study found that knowing how to collaborate was the single most important trait for someone running a small business with less than 100 employees. The best bosses knew how to delegate tasks to others, forge strong relationships with team members and create opportunities that motivate everyone on staff.

Curious this is the other important leadership quality of Sir Peter Leitch that stand out managers in this study were constantly scouring the internet to find the way could improve their business, retain their employees and innovate their products. If you are the type who cannot stop asking questions or wondering what the completion is up to, then you have got small business in your blood.

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Future Focused as Sir Peter Charles stated that leadership quality as a business owner which says keeping a keen on what is coming up is a crucial trait for a successful small business owner. Subjects in the study who planned out their cash flow and succession plans far in advance did better than their short sighted peers.

Mad Butcher is a good example of small private business of Sir Peter Charles Leitch.

The leadership style of the Peter Leitch is the visionary style which made him able to achieve results using the other people like who work for him.

Dan Adams is the operation manager at Mad Butcher and Michael Morton is working as a Chief Executive Officer of Mad Butcher and they are known as key employees of the company and there are about 200 people working for the mad butchers who follow the working strategies of Sir Peter Leitch. Sir Peter Leitch is known as the biggest charity fundraiser and the great supporter of the rugby league of New Zealand.

He had to develop the five main abilities to run his businesses that he already got it and those are creativity, entrepreneurship, personal traits, business management and marketing.

Large sized public business is a term used to describe large corporations, in either an individual or collective sense. The term first came into use in a symbolic sense subsequent to the American Civil War, particularly after1880, in connection with the combination movement that began in American business at that time. The organisations that fall into the category of large business include ExxonMobil, Wal-Mart, Google, Microsoft, General electric and Goldman Sachs.

The example of a large business leader is Lakshmi N Mittal who is known as Steel tycoon Lakshmi Niwas Mittal is the richest Indian in the world, with an estimated wealth of $25 billion. He resides in London, has his company registered in the Netherlands, but still holds an Indian Passport.

Lakshmi Mittal is a transactional leader who guides and motivates his followers in the direction of established goals by clarifying and task requirements. And ArcelorMittal where Lakshmi Mittal is CEO of his company has about 1000 workers working for him and they recently started c6 blast furnace at Cleveland (USA)

He is known as the steel tycoon of the world because he is the biggest steel producer in the world and he got a lot of awards for his work. He has a power of thinking as he said that start thinking out of the box, do not stop your thinking at one point and brain storming is the best way of solving problems. He is been sent to Indonesia in 1960 from his father to close down a steel plant there and to sell the land after this but he and his thinking made this happen and he started running again that steel plant which was getting a loss of $100,000 per day and now Mr Mittal is Business tycoon of the world.

He has many of business communication abilities that made him a successful businessman and those abilities are like -



Good sense of judgement

Definiteness of decision

Skilful planning



Team work

Good personality


In the comparison of the small private business and the large public businesses the main thing is leadership, without leadership the business regardless the type of the business small or large is impossible. And that's what those popular leaders did in their business life to become a business leader of the world in case of Lakshmi Mittal and leader of his own country in case of Sir Peter Leitch. They both have different styles of leadership that made them successful that was Visionary for Sir Peter Leitch and the Transactional Leadership for Lakshmi Mittal and the similarities in both are that they came up from a poor family and become a good businessman. Mr Lakshmi Mittal was born in India (Rajasthan) in 15th June 1950 and now he is the richest man in India, Asia and the United Kingdom and second in Europe. He is the 44th most powerful person of the 68 individuals named in Forbes's most powerful list and his daughter Vanisha Mittal's wedding was the most expensive in the recorded history of the world. He is an independent director of Goldman Sachs. And Sir Peter Leitch is a New Zealand businessman, also known as Mad Butcher. Although he is well known in New Zealand for the chain of butcheries he founded, Leitch is arguably just as well known for his charity, fundraising work and his promotion of rugby league same as Mr Lakshmi Mittal has done great work for charity in India and gave a big support to the poor public of India and so many countries. Sir Peter Leith born in New Zealand (Wellington), he left school at age of 15 to work as a newspaper boy. He gained a job as a butcher's apprentice at the age of 16. The business he started in1971 had 37 stores through New Zealand as of 2011. With the few of similarities between both small and large business operators there are heaps of differences as well those are discussed below -

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The people

The environment and

The politics

These are the simple words but those play a big role as a difference of small and large businesses.

To discuss about the profit business we must know about the profit first and the profit is known as the surplus remaining after total costs are deducted from total revenue, and the basis which tax is computed and dividend is paid. Profit is reflected in reduction in liabilities, increase in assets and/or increase in owners' equity. And the businesses which are concerned about the profit with a main motive of the getting money out of it is known for profit business.

Ratan Tata is good example of a FPB who is the chairman of the Tata group, India's most respected conglomerate. He was born in Parsi family in Mumbai, India in 28th December 1937 and he possess the following qualities that made him successful in business -


As being dedicated means spending whatever time or energy is necessary to accomplish the task at hand.


He did the integration of outward actions and inner values. A leader must have the trust of the followers and therefore this display integrity.


This not same as aggressiveness rather it is the ability to clearly state what one expects so that there will be no misunderstandings. A leader must be assertive to get the desired results.

I would say TATA group of industries is the best example of FPB and the leader like Rattan Tata can be similar to Mr Lakshmi Mittal in case of business but it cannot be similar to Sir Peter Leitch because he is a different type of business leader.

The leadership style of the chosen example as a leader who ids Rattan Tata is democratic.

Sir Ratan Tata, the younger son of Jamsetji Tata, was a connoisseur of art and a notable philanthropist. His legacy of support to the poor and oppressed lives on in the activities of the Sir Ratan Tata Trust.

Ratan Tata was the second son of Jamsetji Tata, the founder of the House of Tata. Born on January 20, 1871, he was 12 years younger than his brother, Sir Dorab Tata. Ratanji, as he was generally known, was educated at St Xavier's College in Bombay.

Sir Ratan joined the firm of Tata & Sons as a partner in 1896. After the death of his father in 1904, he looked after the affairs of the L' Union Fire Insurance Co of Paris, of which Tata & Sons were the agents in India. He was also in charge of the trading firm Tata & Co, which had branches in Kobe, Shanghai, Paris, New York and Rangoon, and traded in cotton, yarn, silk, pearls and rice.

Non-profit organisation is neither a legal not technical definition but as general the organisation that uses surplus revenues to achieve its goals, rather than distributing them as profit of dividends.

And the examples of NFPB are Bill and Melinda Gates Foundation in the United States which has an endowment of appropriately $38 billion and Howard Hughes Medical Institute which has an endowment of appropriately $14.8 billion.

Ramdev is the best example of a leader of NFPB who is known as Yog guru of India as his efforts and workouts is for society without any attention of profit or margin he is serving the community of India. He has a visionary style leadership quality and he has so many charity places in India where he help the poor people who cannot pay for expensive fees of the doctors. He has all the Indian middle community society as his followers. Today even an single Indian regardless poor, middle man or a rich person knows Ramdev for his achievements. Where he has the sympathy of the all the society of India and he has a great moral support of Indian community which is endless. He has all those marketing qualities or abilities to run his business which is not for profit or for the profit of society.

The democratic leadership style is a very open and collegial style of running a team. Ideas move freely amongst the group and are discussed openly. Everyone is given a seat at the table, and discussion is relatively free-flowing. This style is needed in dynamic and rapidly changing environments where very little can be taken as a constant. The advantages of democratic style are the participant can result in high motivation of group members.

The knowledge and experience of group members can be used in decision making.

Members may feel more committed to group goals and less resistant to managerial actions. Individual abilities can be developed through participation. Group may be better informed as a result of two ways communication that is from the group members to the leader and also from the leader to the members the disadvantages are individuals may dominate the participation or make disruptive contribution. This approach can be very time consuming for the leader because of the use of two ways communication .compromise can result in actions that are not the most effective. Conflict may be resolved by making the least offensive decision not the most effective. Situation can develop where responsibilities are not clear cut. Participation may be viewed as a sign of inefficiency on part of a leader. Subordinates may view leader as incompetent to handle the job responsibilities. Visionary leaders are the builders of a new dawn, working with imagination, insight, and boldness. They present a challenge that calls forth the best in people and brings them together around a shared sense of purpose. They work with the power of intentionality and alignment with a higher purpose. Their eyes are on the horizon, not just on the near at hand. They are social innovators and change agents, seeing the big picture and thinking strategically. There is a profound interconnectedness between the leader and the whole, and true visionary leaders serve the good of the whole. They recognize that there is some truth on both sides of most polarized issues in our society today. They search for solutions that transcend the usual adversarial approaches and address the causal level of problems. They find a higher synthesis of the best of both sides of an issue and address the systemic root causes of problems to create real breakthroughs. Classical Management theories mention two kinds of leadership styles: the task oriented leadership and the people oriented leadership. The trick is the ability to combine both styles of leadership in a synergistic fashion. Too much task oriented will create a lot of output but may tend to alienate employees. Too much people oriented may foster closeness and yet may tend to sacrifice the quantity and the quality of output. The best way to combine both is through visionary leadership. The visionary leadership integrates the task orientation style of leadership. People will perform tasks because they are happy to them as they inspired by the vision. Visionary leadership brings out the best in people and make them perform beyond their imagined limitations. In visionary leadership the mechanism of control such as rewards and punishments become internal rather than external. People want to do things right because they understand it in their hearts and not because of some external monetary rewards.


Social responsibility is an ethical ideology or theory that an entity, be it an organisation or individual, has an obligation to act to benefit society at large. Social responsibility is a duty every individual or organisation has to perform so as to maintain a balance between the economy and ecosystem. If businesses or businessman are responsible for the known results of their actions, business responsibilities must include the known results of business dealings, weather these are recognised by the law or not. For a business leader being social responsible is really important because a business can be successful only when it is socially responsible. For example Macdonald as a social responsible business organisation and everyone knows why MacDonald is a socially responsible organisation.

A proactive leadership is possible only if there exists a deep understanding of the interests, priorities, and concerns of the stakeholders. There are ten general principles of showing stakeholders responsibility.

Bring stakeholders interests together overtime

Recognize that stakeholders are real and complex people with names, faces and values

Seek solutions to issues that satisfy multiple stakeholders

Engage in intensive communication and dialogue with stakeholders

Commit to a philosophy of voluntarism

Generalize the marketing approach

Never trade off the interests of one stakeholder versus another

Negotiate with primary and secondary stakeholders

Constantly monitor and redesign process to make them better serve stakeholders

Act with purpose that fulfils commitments to stakeholders.

Ethics also known as moral philosophy that addresses questions about morality this is the concept of good and evil, right and wrong, virtue and vice, justice and crime.

In order to encourage high ethical standards within our organizations, we must first provide an environment that is conducive to ethical behaviour. Management and leadership have a huge responsibility in setting examples for their organizations and living the rules they preach if they want to sustain a culture of ethics.

This statement emphasizes the important role that ethics play in leadership and management in organizations. In general, ethics refers to the principles by which people distinguish what is morally right (2006). Such has been a strong contradiction in terms of business, as profitability should be the overriding concern of business and not ethical standards, thus, this view makes it easy to behave ethically unless an ethical choice is also costly to the organization. However, employees and organizations are also compelled to behave ethically, even if so doing cuts into short-term economic advantages (2006). As such, the battle of good and evil is most evident in the decision-making process of an organization. The concept of ethics is related to many other concepts, such as values, morality, power, effectiveness, and mutual purposes and goals. As its definition emphasizes, the concept of ethics is connected to any morally good, which is evident in terms of decision-making and acting in the group or society. In this regard, it can be perceived that ethics is also important and essential in the many aspects of the organization, such as leadership and management.

            It has been reported that ethics is primarily a communal, collective enterprise, not a solitary one, and as a communal exercise, it is the attempt to work out the rights and obligations one has and share with others. Given the presence of others and one's need of these others both to survive and to thrive, ethics is elementally the pursuit of justice, fair play, and equity. Ethics, then, tries to find a way to protect one person's rights and needs against and alongside the rights and needs of others, which is most evident in the workplace environment. In this regard, the importance of ethics in the workplace is equivalent to the importance of labour, work and business. Business has a moral obligation to make a profit, but is also about people, who work for and work with in the business (1998). In this sense, the connection of ethics and business can be observed, as ethics can also be employed and used in making decisions in business and in the observance of effective work and teamwork of employees in the organization.

Well leader ship is really important in someone's life and leadership have both positive and negative effects on society. It was leadership's effect on Indian society that people got motivated from Mahatma Gandhi and they fought against the British government and send them out finally with the teachings and leadership skills of Mahatma Gandhi. This shows that Mahatma Gandhi and his leadership qualities have a really good impact on the society.

There are some negative examples of leaders like Hitler who had a great impact on the society. Many people got died in the wars likes WWII with lots of grieving families left behind. Large parts of Germany were bombed flat and had to rebuild. German steel mills had to rebuild. Many of other countries were left in ruins, not just Germany.