Discuss about the Sustainability Leadership in Unilever.
Leadership plays a very significant role in ensuring that organisations perform highly in the market. The style of leadership followed in the business organisations, especially multinational organisations has gone drastic changes. The management of these organisations today emphasis on putting the interests of the stakeholders like the employees, customers and suppliers before their own profit interests. In fact, this style of leadership has helped multinational organisations to earn immense profit due incessant stakeholders’ support. This leadership style they use is transformational servant leadership style. The paper would delve into how this leadership style is helping business organisations to grow. It would also show that transformational servant leadership style have positive perceptions on the employees and finally on the company. The company chosen to conduct the research is Unilever, one of largest multinational FMCG multinational companies based in London and Rotterdam,
Unilever is a British-Dutch company that is the largest consumer goods company in the world. In addition to this, it is the oldest multinational company and delivers its products to 190 countries. The main business of the company can be divided into four categories such as foods, beverages, home care and personal care. However, the company has taken various steps to retain sustainability in their products. There are many products manufactured by the company; however, special cares are taken to control the environmental impacts and the company has engaged in certain steps so that the human being could improve their health and lead their life in systematic way (Jansen, 2018). According to product sustainable report of 2013, it can be observed that the company has launched certain sustainable products and the company has contributed certain sustainability towards the environment. Many products of this company have been criticised for its harsh impacts on the environment. In 2008, Greenpeace, UK has filed an allegation of deforestation against the company for its palm oil product. Further, the company has charged for its Asia Pulp & Paper. After all such allegation, the company has developed its production process and concentrated on the environment-friendly solution. In the year 2012, the company has launched Unilever Sustainable Living Plan, the company has made a huge profit of €51 billion, and the company has achieved a significant milestone. There are certain reasons mentioned by the Chief Procurement officer of the company such as climate change, unsustainable farming practice, water scarcity and improper food security for adopting sustainable environmental plan (Galpin, Whitttington & Bell, 2015). There are certain illustrations where the company has applied the environment sustainable plan. In 2012, the company has cultivated tomatoes to maintain the sustainability after launching knorr products. Foods & Refreshment Division has promoted the program relating to the sustainable development and an attempt has been taken to make change with Unilever Sustainable Agriculture Code. A competitive differentiation has been observed through this environmental sustainability and the company has invested in the rainforest alliance certification. Further, the company has launched certain certified courses for the small farmers so that they could get right knowledge regarding the vegetation and agricultural matters. Additionally, the local farmers are become enriched with skills and knowledge regarding sustainable cultivation practice (Grassi, 2017). The company is maintaining certain criteria of environment so that the balance could not be hampered. The company is trying to get 100% sustainable plan for the palm oil production and certain attempts have been taken regarding green plantation. Further, the sugar bought by the company is from bonsucro category, which is imported from Brazil. The company highlights the environmental and societal impacts regarding the sugar cane production. The food and beverages section of the company has been impacted by the environment-oriented formulation of the company (Meulensteen, Vermeulen & Meerman, 2016). Therefore, it can be stated that the company has taken various steps towards the proper maintenance of sustainable program.
McCleskey (2014) defines transformation leadership as the style of leadership where the leader identifies the change which has to be brought about and creates a vision to achieve the target objectives. The leaders following the transformational leadership style identifies the present situation which is either proving to a challenge or can emerge as a challenge in the future. They then form strategies to overcome or at least reduce the challenges. The transformational leaders exhibit high level of adapting to the needs of both the followers and the situation which the organisation is facing. They analyse the impacts which the challenge the performances of the employees and the organisations. They then make strategies to transform the challenging situations by either taking advantage of them or at least reducing their intensity.
Jiang, Chuang and Chiao, Y. C. (2015) mention that servant leadership refers to the leadership style which constitute leaders putting the needs of the followers before their own. They lead their followers to enable them to achieve goals set by the former. According to Shek, Law and Liu (2015) mention that the servant leadership make the followers develop a sense of importance while participating in the achievement of the objective. The followers feel more responsible towards the performance of the team of followers and as a result perform more highly. However, Shek, Chung and Leung (2015) contradict that servant leadership and giving importance to employees often leave rooms for unethical employees to take advantage of the leadership qualities of the leaders and escape their responsibilities. The unethical employees use unethical means and indulge in illegal activities for their own benefit, thus hampering the team performance. Mathieu et al.(2014) mention that in such cases the leaders can use authoritative leadership style to lead such employees. The leaders in this case instruct and monitor the actions of the unethical employees and ensure that their performance is in line with the performance of the whole team. Thus, here it can be pointed out that the authoritative leadership style is actually a stricter form of the servant leadership. Here the leader uses the authoritative style to achieve the goal of the team. This means team goal is put before individual interests which motivate the followers to perform higher to achieve team goal (Deresky, 2017). Thus, it can be summarised that servant leadership style results in achievement of higher degree of performance. One can point out that the discussion apparently illustrates leaders as individual persons. However, it can be pointed out that business organisations combine the two leadership style to lead their employees to achieve high level of performances.
According to Domingues et al. (2017) business organisations today follow transformative servant leadership style to lead the organisations through the market challenges. The external business environment today necessitate the business organisations to operate in sustainable ways and ensure value for the employees. The organisations are under continuous pressure from external stakeholders like government to comply with laws and act ethically to ensure high quality products for consumers. As per Yu et al (2014) the business organisations have to create value for customers which lead to customer satisfaction and revenue generation. Singh and Pattanayak (2014) mention that business organisations, especially the multinational public companies are dependent on the shareholder support to raise capital from the market. The business organisations are bound to cause capital maximisation of these investors in order to attract more capital. Holland et al.(2016) point out that consumers today are not only concerned about about the quality and utility of the products but also about the impact products have on the environment. Tietenberg and Lewis (2016) further point out that governments today necessitate business organisations to comply with stringent environmental laws breach of which attract strong actions from the former. Thus, apex management bodies of multinational companies are required to ensure benefitting all the stakeholders to attain sustainability. Maduka et al. (2018) mention that managers today require to transform the entire team management method and take steps like replacing tall organisational structures with flat organisational structures to make decision making more dynamic. They encourage participation and benefit of their subordinates thus, embracing servant leadership styles. The business organisations today aim to manufacture more environment friendly products in order to benefit the consumers and generate more revenue. The managers take into account expectations of consumers while manufacturing products to generate maximum revenue. This enables them to give maximum interests to investors and pay high taxes to revenue (Handley & Louw, 2016). Thus, business organisations use transformational servant leadership styles to achieve sustainability and business growth.
Several approaches have been made to define the ethics and morality in a leadership. There are certain differences in between the servant leadership and transformational leadership. The servant leadership deals the fundamental growth and well-being of the people and the communities. The transformational leadership deals organisational objectives. According to Bass, transformational leadership takes place where the leaders are broaden the interest of their employees to achieve their mission and target. Therefore, in transformational leadership, there is no place for the self-interest and the leaders protect the interest of the employees. In this case, the leaders are motivating their employees to transform the personal values to achieve their goal (McCleskey, 2014). Further, the transformational leaders have created certain amicable environment. They are generally establishing the trust climate within the workplace. There are certain behaviours that constitute the transformational leadership. The behaviours can be divided into idealized influence, inspirational motivation, and intellectual stimulation and individualised consideration. One of the fundamental duties of the transformational leaders is to inspire the employees so that they can work in a team and achieve the target of the company. The transformational leader will deal all the risks generated from the employment. The leaders will assess all the challenges emitted from the work and they are inspiring the employees to see the attractive the future state. The transformational leaders are playing an important role in the development of a company and they are showing their skills to meet all the targets and united all the employees together to mitigate all the problems (Breevaart et al., 2014). Several researches have proved the fact that transformational leadership has able to create value congruency and trust. Therefore, it can be stated that the transformational leaders helps to coherent the vision of the company in a clear manner.
There are certain differentiations could be seen in case of servant leadership. According to Greenleaf, the primary aim of the servant leader is to think about the role of the leaders as a servant. A servant leader will serve and meet the requirements of others and in this way the leaders will gain the credibility and trust from the others (Schmitt, Den Hartog & Belschak, 2016). The concept of servant leadership is very popular and according to both of the leadership style, certain essentials are required to maintain proper value in a company such as influence, vision, trust, credibility, delegation, integrity and modelling. Betterment of self is a part of the transformational leadership; but it is not at all required in the servant leadership. However, the purpose of both the leadership is to develop the base of the company. Values are given to the people in both the cases and according to Keith (2015), the components of servant leadership are close to that of the transformational leadership.
It has been observed that Unilever is a popular company and maintain a great sustainability plan for its entire product. The main purpose of the sustainable plans and procurements is to develop its base without harming the nature. The main purpose of the company is to achieve the highest standard of corporal behaviour so that everyone could communicate with each other and act for the interest of the company. However, no one is permitted to cause environmental degradation and the employees are required to act with integration. This is the process to achieve corporate aim and meet the corporate social responsibility.
Unilever is a bright name in this globe that maintains the environmental sustainability. The main values of the company could be divided into certain parts. The purpose of the company is to make positive impacts though the brands and other commercial operations. This helps the company to maintain good relationship with the others and makes firm engagement with the society. In this regard, company is required to promote the idea of servant leadership so that all the products could be served in a proper manner and with voluntary contribution. Further, the company requires certain categories of leaders who can show continuous commitments to improve the environmental impacts (Liden et al., 2014). The validity of the goals are long-term and planning are required to develop the sustainability of the business. However, transformational leadership is also required to achieve certain aims of the company. The corporate purpose of this company is to set out certain aspiration for the running of the business. The inspirational attitude of the transformational leaders will help to gain the operational standard of the company. According to the business principle of Unilever, the company has to maintain similar operational criteria on global wide and maintain all the business integrity and responsibilities. In this case, transformational leadership is quite effective, as it is important to act for the betterment of the employees, customers, and organisation and for self. The company respects the principle of human rights and attempts to secure the interest of the employees. Further, all the consumer related laws and regulations are required to be maintained by the company (McCleskey, 2014). It helps the company not to create environmental degradation by any of its employees and the company is following certain rules regarding its product manufacturing. It has previously been discussed that the company has taken many steps to maintain environmental sustainability and new techniques taken by the company has made a great competition in the world. Further, the acts of the company has promoted the environmental care and made a huge increment regarding the mitigation of environmental issues and publicize good practices. The personal mission of the CEO of this company is quite attractive and it reflects the internal motto of the company. According to Paul Polman (2017), CEO of Unilever, the company is not just based on the profit making process, but to act for the benefit of the customers and maintain environmental sustainability. The positive social impacts of the Unilever Sustainable Living Plans reflect this ideology. The appreciation of International Business Council of the World Economic Forum supports this fact (Schmitt, Den Hartog & Belschak, 2016). Therefore, it is to be stated that the company should have to focus on the transformational servant leadership to retain this mentality.
Unilever uses best practices of transformational leadership in areas like marketing, innovation and financing which is evident by the high international position in holds in the FMCG market. The first way in which Unilever uses transformational leadership is to market its products in the global market. The multinational business organisations first gain information about customer expectations and the apex management uses this information to form marketing strategies (McCleskey, 2014). The apex management of Unilever considers these expectations of customers to form product strategies. The managers instead of using authoritative leadership style to command the subordinates, take into account their attributes like experience, qualifications and expertise. Thus, in the first case Unilever places the interest of the customers before its own profit making interests. The managers of the multinational company in the second case places the interest of the subordinates before their own interest of merely ordering the latter and achieving targets. One can point out that the multinational company has strengthened its organic product line to reduce the impacts its products have on the environment. The company has introduced fruit based skin care products replace products having plastic beads which harm the environment. The business organisation thus gives high preferences to benefit of the environment and society as a whole. This introduction of bio-friendly products are evidences of the research and development which Unilever. The company conducts continuous innovation to introduce new products and better versions of existing products more value for its consumers. This earns British multinational its immense consumer base which renders it its robust revenue (Liden et al., 2014). The company as a result is able to give consumers high returns on their investments. This proves that the company uses transformational service leadership to attain sustainability and stakeholder benefits.
Personal actions have great implications for leadership in the Unilever. I can point out that Unilever stress on development of knowledge of self, needs of the stakeholders and business objectives by applying transformational servant leadership. This leadership style according to my learning have strong implications on the personal actions of employees. The apex management of Unilever first uses the expectations of the customers to form the business strategies. This ensures that the production of products in the company are aligned with the customer needs. This customer support acts a financial security and encourage the suppliers to supply high quality raw materials at economic rates. This employees involved in product manufacturing are also motivated to manufacture higher qualities of products. The production managers put the motivation of their subordinates and the interest of the organisation before their own interest. Thus, I can summarise the discussion by stating that use of transformative servant leadership style have implications on the personal actions of the employees and enforce a more positive attitude among them towards the organisation.
The managers should from a personal action action to apply transformational leadership style to enforce positive personal perception among their subordinates. The following is the personal action plans which managers can adopt to enforce transformational servant leadership within their departments:
Recognising the business objectives predetermined by the apex management (1 month):
The managers should first recognise the business targets set by the apex management and then form strategies.
Establish a strong communication within their departments (1 month):
The departmental managers should establish a strong communication channel within the department which would in turn align the employees with the apex management plans.
Encouraging employees to take part in strategy formation:
The managers should encourage the employees to participate in the strategy formation to achieve the target. The manager while allocating responsibilities among the employees should stress on the qualifications, experiences, skills and knowledge of the employees.
Motivate them and monitor their performances:
The manager should motivate the employees and monitor their performances on regular basis. He should train and mentor them to improve their skills. This would enforce positive perception among the subordinates and motivate them to overachieve their targets.
Conclusion:
One can conclude from the discussion that leadership style adopted by the apex and middle management have significant impact on the company and its employees. The management of the multinational companies like Unilever should use transformational servant leadership style to motivate the employees and encourage them to achieve higher targets. They should also form strategies to benefit the stakeholders like investors, customers and suppliers. The managers heading departments like marketing and finance should follow similar leadership style while leading their subordinates. They should motivate and encourage their subordinates to achieve higher target and create positive perception among them.
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