Leadership And Management Style Of Carlos Slim For Pragmatic

Pragmatic reasons for Slim’s Philanthropy

Discuss about the Leadership and Management Style of Carlos Slim for Pragmatic.

Organizational effectiveness and performance is directly linked to styles of management and leadership that seek to utilize every opportunity. Successful organizations explore the market through business processes that create competitive advantage to allow the organization to compete and perform better against other organizations. Organizations that have a higher success in the world have been established on a set of management, leadership and philosophical concepts that guide the way the organization runs its activities (Nan jundeswaras wamy & Swamy, 2014, P. 57).  In an ever changing global environment only organizations that are surviving the current economic times are the ones with superior business strategies that guide the way the organization operates.

Mullins  (2004, P. 13) suggests that such organizations are established on a philosophy that understands the needs of employees and the customers that they serve. This means that they compose of leaders who have put in place strategies to accommodate every need of the employee to ensure that this translates into products and services that such employees give to the customer. This defined as competitive advantage in management terms since it allows organizations to manage the environment that they operate in. This report analyses the inconspicuous Carlos Slim Hilu success in business by analyzing reasons behind the business philosophies, business concepts, leadership styles, employee patterns and the type of power that exists in the organization.

Philanthropy is the love for humanity and caring for other humans through exercising values that emphasis the quality of life through material support. Slim had contributed $40 billion of charity by 2010 through believing that there is need to support the community through such initiatives. However, there are pragmatic reasons behind the philanthropic support that makes him spends lots of money in such initiatives. According to Ke, Qui, & Jiang (2015, P. 468) suggest that organizations in the 21^st century are focusing on societal issues as a way of appealing to the society that they indeed care about their welfare thus increasing business opportunities within such societies. Management scholars have given philanthropy the new meaning strategic philanthropy that seeks to put the organization at the heart of the community. Safwat (2015) suggests that the relationship between business and society has recently changed and led to new concerns have forced business to reconsider the role they play in the society.  The approach of corporate philanthropy ahs change the way businesses carry out their activities sto ensure that they meet the needs of the communities that they work in.

Customer lock-in

Through philanthropy, Slim develops better relationships with the communities and stakeholders and form informal partnerships with such groups to ensure that the community appreciates the things that they do.  This makes the relationship between the business and the community more credible and trustworthy.  Through such initiatives, the prospects of the business are supported over long term by the community.  This allows the business to account for a wide spectrum of people that it deals with. These philanthropy initiatives, are implemented along a wider range of stakeholders to ensure that business practices are highly acceptable (Hart & Milstein, 2003, P. 60). This can be related to the four pillars of social responsibility; economic, ethical, legal and discretionary responsibility. This discretionary practices allow business owners to easily give back to the communities that have contributed to their success.

Further Ke, Sun, & Wu, 2015)strategic philanthropy is a new strategy un management that is used by many organizations to penetrate the society through giving out philanthropy for business benefits. When the organization supported the need for employees to buy computers through allowin them to deposit for a computer as they pay for their telephone bill, this was a strategic business initiative to benefit the from the society (Hopkins, 2006, P. 22). Later the company started selling computes after its employees had acquired computers. This method links the resources of the organization to a variety of partners to the ground. This is a shift from volunteerism to sharing of community needs and bringing the community closer to the business initiative.  This investment are tied to larger investment goals that the organization seeks to achieve in the future. Philanthropy is thus a strategic target for increasing business process and acceptance of the community.

Customer lock in is a business strategy used to maintain customers by making them dependent on the particular product that the business offers them without looking for other substitute products. This is thus  a customer retention strategy that is employed by organizations in the market by presenting barriers that will keep customers from switching to other suppliers (Sadighi, Mahdi Ghobadi, & Hasanpour, 2015, P. 748). Slim used the business model Telmex to lock in customers through a business plan called ‘Gillette” that required customers to sign up for prepaid cell-phone service that they needed to used for communication through theTelmex brand. Through buying a handset from the company Slim ensured that the company maintains its customers in the telecommunication industry thus restricting them from choosing other suppliers in the market thus creating competitive advantage. Customers loyalty is achieved through locking in their purchasing options. Business analysts have argued that the only way a business can grow is to lock in its customers and try to focus on oportuionties that will allow the business to grow.

Carlos Leadership Styles

Microsoft is another organization that has achieved customer lock in by developing a distinct windows operating system that cannot allow users to easily switch to other windows. It has been argued that the company achieves customer lock in through developing a deeply embedded windows source code system that has many windows application that make it difficult for its users to switch to another product (Zhu & Zho, 2011, P. 3). The switching cost of using other windows will mean that users have to rely on products from more than one organization, thus making it easy for Microsoft customers to rely on the system solely. Customers prefer sticking with the challenges associated with the Microsoft program rather than incur the costs of switching (Krogh & Hippel, 2006, P. 989). Since Microsoft keeps on upgrading its products, customers are thus satisfied with the challenges and believe the challenges can be addressed. Further, the documents designed from the Microsoft outlook program are not rewritable or compatible with other products making it difficult for users to rely on other products. Therefore Microsoft uses productd standads that are set so high that places the company as a leader in the softwares that ir designs thus creating a competitive advantage for its products.

Ahmad & Buttle (2002, P. 151) suggests that customer switching costs are  costs associated with from one product to another. This will include elements like effort, time and knowledge of the particular product. Organizations need to understand the customer life cycle process which entails acquisition, retention and development.  The customer lock in strategy increases the value of customers while customer development focuses on increasing the value and benefits that the customer gets from the organisation (Weinstein, 2002, P. 263). This leads to benefits like lower customer management costs and thus increase referrals within the market.

Leadership entails providing direction, motivating employees and planning activitiess to achieve goals. Leadership styles have varied depending on the nature of the tasks that are being carried out and the nature of people (Assunta, 2007, P. 20). Carlos uses different leadership styles in managing the organization to achieve the best results. It is evident from the case study that leadership styles have heavily contributed to the success of the organization. One style used ins the people-oriented transactional leadership style. Transactional leaders seek to motivate followers with rewards and punishment to achieve results. The leader identifies employee needs and uses rewards to increase performance of such employees. This means that the leader focusses more on efficiency by establishing standard practices to improve the organization. On the other hand people-oriented  leadership is based on the relationships that are formed between employees through meeting the expectations and interactions of subordinates. This entails inspiring people to have confidence in the leadership abilities of their leader (Engelbert & Wallgren, 2016, P. 11). People-oriented leaders, therefore, emphasis relationships more than any other thing.

Through combining the two strategies, Carlos ensured that there wee good relationships between employees and management to improve business processes.  employee involvement was based on the freedom to make business decisions without necessarily relying on the overall boss (DuBrin, 2001, P. 32). This builds confidencee in employees and makes them accountable for every decision that they make. Through developing close relationships with and between employees, Carlos achieved system efficiency and improved standards which led to the best results.

Task oriented leadership styles are based on focussing on the tasks that need to be performed within the organization. This allows the leader to concentrate on achieving the goals of the organization. This means that the leader focusses on completing the job thus concentrating on the way the task needs to be done.  This will entail coordinating tasks and activitiess and aligning them to the needs of the organization. On the other hand, Forsyth (2010, P. 253) suggests that the autocratic leadership is based on the control of decision making processes within the organisation and limiting the input of other members of the organization. This holding of absolute power is important in critical decisions that need to be made without the involvement of other employees. Carlos used a mixture of this as way of achieving organizational goals through getting tasks done and at the same time making sole critical decisions like developing the “Gillette”  business model.

Reserch has show that there is no best leadership style since different situations call for different styles of leadership that can work well. This is the reason why Carlos cannot be associated with any particular leadership style that was used in the case study. Different leadership styles worked well in different situations that the organization was in (Schultz & Ellen, 2010, P. 201). In  a situation that demanded autocratic, Carlos made the decision alone while in a situation where the decision was to be transactional then employees were involved. Activitiess were run in the organization based on task oriented style while connection between employees were based on a people-oriented style that allowed them to interact. This mixture of ;leadership styles gave the best management style that allowed Carlos to be related to a charismatic leader.

Leaders get things done through influencing other people by showing people the right direction and what to put in place to achieve. This is through motivating employees to perform the social contract role of foregoing their own interests and put the organization first (Amar, 2001, P. 11). Good leadership provides competitive advantage for the organization. Carlos has managed to motivate employees because of the leadership attributes and skills that he has. Leadership is a trait that many people are born with thus making it easy for them to easily influence others in the right direction. Raelin (2003, P. 22) suggests that through leadership attributes, leaders influence others through providing direction and solutions for problems that arise. The organization largely dependent on Carlos to make all the major decisions on what needed to be done. Through use of different ;leadership styles, Carlos was abe to satisfy the needs of employees and achieve organizational goals. Employees end up adopting this leadership charisma to the extent that the leadership traits of the leader become organizational culture.

The organization consists of irrational and rational followers who have several reasons for following the leader. However, most people follow leaders because of money, status, power, or entry into a meaningful enterprise by following a great leader. In the case of the Carlos, employees who follow the leader focus on the organizational goal of helping the organization to grow to benefit from progress of the organization. Psychoanalysis theory explains that employees follow the leader through dynamic transference that allows them to adopt the strategies put in place by the leader and applying them in their life processes (Maccoby, 2004, pp. 6). The leader follower relationship is achieved through transference from the leader to the follower. The leader will thus transfer the attributes that they have to the subordinates thus making the subordinates to follow them as organizational culture.

Power is the ability to influence others through the authority that one has. Authority is thus the right to exercise power based on the position that one holds either given by the state, knowledge or deity. Leaders use the power and authority that they have to make decisions and influence the direction of others (Maccoby, 2004, PP. 11). This means that leadership is more than management of people and tasks but rather it is a skill that requires knowledge and practice to make it effective. Leaders will exercise different types of power to manage and control those that they lead. Carlos uses legitimate power to manage and control the organization in all perspectives. This is based on the position or role that the individual holds within. The organization is organized in a command and control structure that is dependent on the organizational structure that the organization uses.  Through legitimate power, structures in the organization are formalized ion a way that makes puts people in certain positions and allows them to make decisions that they are responsible for the decisions that they make. However, leaders need different types of power to lead the organization (Assunta, 2007, P. 21). Different situations may call for different types of power that the leader has to exercise. When employing power leaders need to understand the values of the organization so that the decisions that they make can be in line with the ascribed values of the organization. Further social and emotional competence has to be achieved by leaders as a way of ensuring that they understand different variables that may affect decision making within the organization. Carlos was aware of different attributes within the organization like gender, demography, age and social status that shaped the overall decision that the organization makes.

Conclusion

It is evident that leaders have different abilities that are key to the success of the organization. Leadership approaches that exist within the organization are based on the leadership style that the leader belies in. These leadership styles are not specific but rather unique and varying from situation to situation. Leaders can influence others to follow then through transference and a build a culture that meets the needs of the organization. The success of Carlos Slim was not based on establishment of unique leadership style but rather a set of leadership strategies that were applied according to the situation that existed. One evident thing from the case study indicates that the management style that was adopted by Carlos was a mixture of several management and leadership styles that were merged together to develop the best strategy.

References

Ahmad, R., & Buttle, F. (2002). Customer retention management, a reflection on theory and practice. Marketing Intelligence and Plannimng, 20(3), 149-161.

Amar, A. D. (2001). Managing knowledge workers: Unleashing Productivity . Westport: Quorum books.

Assunta, B. M. (2007). Leadership Styles of World’s most Admired Companies A Holistic Approach to Measuring Leadership Effectiveness. ernational Conference on Management Science & Engineering, (pp. 20-22).

DuBrin A., J. (2001). Leadership: Research findings, practice, skills. Boston: Houghton.

Engelbert, B., & Wallgren, L. G. (2016). The Origins of Task- and People-Oriented Leadership Styles; Remains From Early Attachment Security and Influences During Childhood and Adolescence . Sage Journals.

Forsyth, D. R. (2010). Group Dynamics. Belmont, CA: Wadsworth Cengage Learning.

Hart, S. L., & Milstein M. B. (2003). Creating sustainable value. Academy of Management Executive, 17(2), 56-69.

Hopkins, M. (2006). Corporate Social Responsibility and International Development: Is Business the Solution? London: Earth Scan Publications Ltd.

Ke, J., Sun, J., & Wu, D. (2015). Corporate Philanthropic Behavior Scale and Its Impact on Employees Workplace spirituality. Research on Economic and management, 35, 100-108.

Ke, J.-L., Qui, X.-W., & Jiang, Y.-F. (2015). The effect of corporate philanthropy on organization commitment and job performance of employees; workplace spirituality as mediating variable. American Journal of Industrial and Business Management, 5, 466-473.

Krogh, V., G., & Hippel, E. V. (2006). The Promise of research on open source software. Management Science, 52(7), 975-983.

Maccoby, M. (2004, September). Why People Follow the Leader: The Power of Transference. The Havard Business Review.

Mullins L. (2004). Management and Organisational Behaviour. Prentice Hall: Pearson Higher Education.

Nan jundeswaras wamy, T. S., & Swamy D. R. (2014). Leadership style. Advances In Management, 7(2), 57-62.

Raelin, J. (2003). Creating leaderful organizations: How to bring out lederhsip in everyone. San Francisco: Berrett-Koehler Publishers, Inc.

Sadighi, M., Mahdi Ghobadi, M., & Hasanpour, S. H. (2015). A Conceptual Model for Customer Lock-in Effect in Electronic Business. Proceedings – 12th International Conference on Information Technology: New Generations, (pp. 746-750).

Safwat, A. M. (2015). Corporate Social Responsibility: Rewriting the Relationship between Business and Society. International Journal of Social Sciences, 4(1), 85-97.

Schultz, D. P., & Ellen, S. (2010). Psychology and work today : An introduction to industrial and organizational psychology. Upper Saddle River: Prentice Hal.

Weinstein, A. (2002). Customer retention: a usage segmentation and customer value approach. Journal of Targeting, Measurement and Analysis for Marketing, 10(3), 259–268.

Zhu, K. X., & Zho, Z. Z. (2011). Lock-In Strategy in Software Competition: open-Source Software vs. Proprietary Software. Information Systems Research, 1-10.