Select a leadership issue in an organisation of your choice. Draft the introduction, statement of the leadership issue and analyse the issue.
The research title that it emphasizes the business issues that are encountered by Tesco, UK. The analysis of the company depicts that it’s the UK multinational grocery as well as general merchandise retailer, whose headquarters are situated in Chestnut, UK. It is noted that Tesco is the considerable retailer, that is based in the UK, and has successfully attained the vital position level all around the whole retail industry in the UK (Annual Report, 2010). It includes more than 500000 employees, which signifies that the company is operating its work on colossal scale. Tesco plc analysis shows that the company is running on a large scale in both the domestic and international market (Chapman, 2014). In result of that, Tesco has essential responsibility level towards a massive range of stakeholders all around the company. The performance of whole business requires to go positive so that the company can easily contribute towards the high growth and development level.
Analysis of the previous literature depicts the vast range of topics, which can be seen about Tesco performance. The Tesco business performance is understood to be negatively impacted in current years, and the principal reason for it are many (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004).
The principal reason behind the declining performance of Tesco plc is lack of trust, which is hugely ineffective in context of leadership that is practiced by the company. Tesco under the Sir Terry Leahy leadership has tried to attain the success level and was even successfully able to maintain the sound relationship with the customers (Harvard Business Review, 2013). At the time of his leadership, Tesco has reached the leadership position within the industry. Nevertheless, the Philip Clarke leadership has damaged the entire image of Tesco plc, and the company has even lost their share with many other competitors in the market. The trust of the company among its customers that was built in the last many years has completely eroded, and the same can be seen through the lost sales as well as reducing revenue performance of an organization (Muijs, 2010). Nevertheless, the effect of inefficient leadership can be seen in different vital areas that are operational within the company.
For instance, it is analysed that Tesco has successfully accounted for a considerable number of leaders that hope massive experience for many years. Tesco employees are highly empowered to take the decision, which aims towards leading the company towards high success level. Nevertheless, as per the inefficient Philips Clarke leadership, most of the experienced leaders were permitted to leave the company in, and the same has impacted the full conditions of company’s performance (Wilson, 2010). This depicts that the effect of inefficient leadership is viewed in the context of human resource management that holds essential resources, made available to Tesco Plc.
It is analysed that not only the leadership issues that have impacted the Tesco plc performance, instead of that many other factors are also counted as responsible for the reduction in the complete performance of the business of the organization. For example, there were many frauds that can be seen at Tesco plc, between the years 2014, where else it was analysed that there has been the profit overstatement, performed within the financial statements of the firm to around £250m (Tesco Plc, 2015). In result of the same, there was a downfall for the company that was witnessed on the company’s share price, along with that there was a urgent investigation that was launched over companies book accounts (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). This specific factor had acted correctly in an adverse way over company’s performance, as well as the cost of shares that were reduced by 10pc (Tesco Plc, 2015). In result of the options for the corporate frauds, warnings were also issued to the organization, which was issued for an organization, but the same has affected the entire reputation of Tesco plc negatively (Tesco Plc, 2015).
Leadership Issues
The governance and management issues are explored as necessary, as they have impacted the complete performance of the organization negatively. Philips Clarke leadership is not highly effective towards fostering the mechanism of efficient governance at Tesco, and the same has permitted for the problems related to accounting frauds in accounts books of the company (Judge & Piccolo, 2004). The research also shows that there is an inefficient management practice in a company that had led to adverse effect on the performance of the business. This kind of inefficient management can be seen through the decisions taken by the management of Tesco (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). It is also depicted that the company had performed importantly at all the investment level for developing the infrastructure for their retail stores when the behaviour of the consumer is showed as entirely changed towards the process of purchase decision making. For example, it is also depicted that there are still many high preferences set by consumers for the online shopping and expanding the online platform, like a significant investment on the offline mode that is highly inefficient from the perspective of complete organization performance (Keller, 2006).
The reputation that is built by the company in the past years is importantly destroyed, due to the events of the company. The examples related with the corporate frauds, as well as a reduction in the trust level of customers, along with ineffective leadership practices applied, lead to the loss of various efficient leaders and staff, as both have impacted the entire reputation of Tesco in a negative way over performance and profitability of the company (Avery, 2004). For example, analysis related to the Tesco plc financial performance shows that there is a high reduction, which is seen in the context of revenue along with company’s profitability performance in the last two years (Hofmann & Jones, 2005). Between the financial years 2013-2014, it is analysed that considerable reduction is seen in both the profitability and revenue performance of Tesco that relates to the critical issue faced by the company.
Leadership style
In the recent years, it is analysed that the effect of various leadership styles, as well as the approach of the company, has highly dominated most of the debates related with practitioners and academicians. The actual reason is that leadership style adopted might evoke the subordinate’s performance and is also significant in attaining the organizational goals. Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom (2004) offers a comprehensive, practical suggestion to both the managers and leaders over important topics like the management of employees, different leadership styles, and best practices followed among them.
Judge, Bono, Ilies & Gerhardt (2002) address the relationship of leadership performance. In their analysis, they have expounded over particular paradigms of research like the visionary and transactional paradigms as well as different ignored potential paradigms such as classical and organic paradigm (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). It is criticized that bass’s transformational leadership theory in case of exploring, that there is no way related with leadership and instead of that it point towards the various leadership types, which reflect over social and historical roots. It is analysed that performance of the company different as per the kind of leadership paradigm applied. Judge, Heller & Mount (2002) suggests that the research and context paradigm is required while researching the impact of leadership on the organization performance.
Many research studies have been conducted and include cross-sectional designs as well as similar performance measurement method for the issues (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). It is noted that the performance management quality is essential for examining the results of leadership approaches in the performance of the company. Lim & Ployhart (2004), for instance, had ignored the emphasis on the correlation between the financial performance and satisfaction of customers. Employing the customer satisfaction and financial measurements are significant for improving the research validity.
Theoretical framework
Leahy is referred to as the visionary leader behind Tesco success. He is also considered as the excellent leader that had led the company towards many organizational changes, with the purpose of making the company customer-centric and for developing the workforce. There is five power base among the famous leadership models, such as referent power, reward power, coercive power, legitimate power and expert power (Rowe, Cannella, Rankin & Gorman, 2005). Terry Leahy success is through three power factors like referent power, expert power, and legitimate power. It is noted that legitimate power try to stems from the place of individuals in the company and also initiate the right to ask for compliance through a subordinate. Leahy had attained the power through ascending Tesco CEO (Rowe, Cannella, Rankin & Gorman, 2005).
It is noted that expert power includes communication skills, interpersonal skills, as well as scientific knowledge. This expertise relies on the viewpoint of ownership of different ability as well as knowledge. The colossal experience of Terry in the organization had helped him in making him possess right knowledge related to industry, company operation, and customers. On the other side, referent power relies on the members of the group attraction towards identification and leaders respect (Schriesheim, Castro, Zhou & Dechurch, 2006). The interpersonal skills and charisma of Terry helped him in making his subordinates to achieve intrinsic satisfaction with their leader.
The theory of bass related to transformational leadership focuses that the leaders always try to motivate there follow staff through establishing the issues, inspiring them as well as stimulating the personal development (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). It is noted that his followers profoundly influenced Leahy through motivating them as well as encouraging them. All around the role of leadership, Leahy has tried to focus towards participative management and empowerment of employees (Lim & Ployhart, 2004).
Terry applied the leadership style of participative, in which subordinates were highly active to get involved in the process of decision making. Besides that, he also delegated the role of leadership towards individuals in the company, while focusing on the significance of appointing the leaders to manage the different process of organization (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). Appropriately, they have hired the democratic leadership style in their supervisory role in the organization. His style of leadership had tried to bring change in company’s structure (Lim & Ployhart, 2004). Indeed, he also ascribed the success epitome that is respective and credible.
Empowerment of employees, as well as participative management, has created effect over enhancing the morale of employees, encourage the flexibility, strengthen the trust of employees, increase productivity and elicit the high commitment. The idea related to the employee participation and empowerment is highly potent towards Tesco Plc (Lim & Ployhart, 2004). This kind of practice about connecting employees in the process of decision making has held many benefits.
Considering the achievements through Terry appointment as the CEO, it is noted that his style of leadership has tried to bring change in the company towards adopting the organic system that is featured through sharing the process of decision making, flexible structure of authority, moderate application of formal regulations and rules, and enormous explained responsibilities of job (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). This kind of arrangement is relevant for remaining innovation and for maintaining the competitive benefits.
Lim & Ployhart (2004) had analysed that, effective leadership has emerged and it’s the only effective style of leadership, which is considered as the main reason for the slow expansion of the organization performance (Lim & Ployhart, 2004). It is noted that transformational leadership is highly effective towards maintaining the competitive benefits of Tesco Plc.
The analysis leads to exploring that Tesco has successfully developed its right image in the entire retail sector in the last many years, but it takes only less time in losing its brand image, which had taken years to develop (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). In result of that, the implications of business in the context of exploring the issue is that Tesco should work towards taking appropriate steps for planning and they should also take right measures, that permit the company in rightly examining the issues as sustained through companies operations (McShane & Von, 2000).
The critical loophole as explored is mainly in the context of the leadership problems at Tesco and this requires to be efficiently examined so that the company can quickly regain the lost share of the market and can efficiently investigate every key loophole around various critical organizational process faced through it (Raelin, 2003). From the complete analysis, business implies that management not only requires to get changed, but it’s recommended that proactive steps should be covered because of targeting the brand image recovery and finally the performance level of the company (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). The position of leadership, which is left previously through the last CEO require to be achieved again so that the company can quickly create the right effect on the target customers (Zhu, Chew & Spangler, 2005).
Overall, the complete research is undertaken to prove the high effectiveness from the perspective of examining the principal aim for which it’s committed (Hoogh, Hartog, Koopman, Berg, van, Weide & Wilderom, 2004). The study is mainly emphasized towards exploring the business issues that are seen in context of Tesco and the conduct of complete research has shown the findings that there are vast range of problems faced by Tesco in business performance, and it’s recommended that there is a requirement for taking practical steps in context of enhancing the Tesco plc leadership effectiveness that is needed through it (Thomas & Adair, 2004). According to analysis, the appropriate suggestion is explored with an aim to attain the performance and emphasize towards improving its image in the industry and should make sure about the strategic decision should be taken on time to time basis, so that the company faces issues are examined efficiently (Taylor, 2006).
Self-Reflection on the integration of faith and leadership theories
From this research, I have analysed the importance of transformational leadership in Tesco Plc. I have also learned that this leadership style is quite influential in the performance of the company. I have learned that leadership is a very pertinent factor in the performance of the company and also play an essential role in both management and behavioural science. I can mention that there is no doubt that Tesco had tried to perfect the notion of effective leadership in successfully achieving the competitive edge by the styles of leadership portrayed through the favourite heroic. From this study, I have learned about the Leahy Terry along with its transformational leadership approach. Though this study had tried to portray in nature, instead of being conclusive, it highly contributes towards the evaluation of the compatibility of various methods of leadership and leadership styles applied at Tesco Plc.
References
Annual Report. (2010). Tesco PLC. Retrieved from, https://www.investis.com/tesco/pdf/review2009.pd
Avery, G.C. (2004). Understanding Leadership: Paradigms and Cases. London: Sage
Hofmann, D.A. & Jones, L.M. (2005). Leadership, collective personality & performance. Journal of Applied Psychology, 90(3), 509-522
Chapman, M. (2014). Analysis: Tesco’s image problem must be addressed by new boss. Dave Lewis
Harvard Business Review. (2013). Harvard Business Review on Finding & Keeping the Best People. Harvard Business Press.
Hoogh, A, Hartog, D, Koopman, P.L., Berg, H.T, van, D, Weide, J.G, & Wilderom, C.P.M. (2004). Charismatic leadership, environmental dynamism & performance. European Journal of Work and Organizational Psychology, 13(4), 447-471
Judge, T.A, Bono, J.E, Ilies, R. & Gerhardt, M.W. (2002). Personality & leadership: A qualitative & quantitative review. Journal of Applied Psychology, 87(4), 765-780.
Judge, T.A. & Piccolo, R.F. (2004). Transformational & transactional leadership: A meta-analytic test of their relative validity. Journal of Applied Psychology, 89(5), 755-768.
Judge, T.A., Heller, D. & Mount, M.K. (2002). Five-factor model of personality & job satisfaction: A meta-analysis. Journal of Applied Psychology, 87(3), 530-541.
Keller, R.T. (2006). Transformational leadership, initiating structure & substitutes for leadership: A longitudinal study of research & development project team performance. Journal of Applied Psychology, 91(1), 202-210.
Lim, B., & Ployhart, R.E. (2004). Transformational leadership: Relations to the five-factor model & team performance in typical and maximum contexts. Journal of Applied Psychology, 89(4), 610-621.
McShane, S.L., & Von, M.A. (2000). Organizational Behaviour. Burr Ridge: Irwin/McGraw-Hill
Muijs, D. (2010). Doing Quantitative Research in Education with SPSS. (2nd ed.). SAGE Publications Ltd.
Raelin, J. (2003). Creating Leadership Organizations: How to Bring out Leadership in Everyone. San Francisco, CA: Berrett-Koehler.
Rowe, W.G, Cannella, J, Rankin, D., & Gorman, D. (2005). Leader succession & organizational performance: Integrating the common-sense, ritual scapegoating & vicious-circle succession theories. The leadership Quarterly, 16(2), 197-219
Schriesheim, C.A., Castro, S.L., Zhou, X. & Dechurch, L.A. (2006). An investigation of path-goal & transformational leadership theory predications at the individual level of analysis. The Leadership Quarterly, 17(1), 21-38.
Taylor, R.H. (2006). Research Methodology: A Guide for Researchers in Management and Social Sciences. PHI Learning Pvt. Ltd.
Tesco Plc. (2015). Retrieved from, https://www.tescoplc.com/index.asp?pageid=10
Thomas, N., & Adair, J. E. (2004). The John Adair Handbook of Management and Leadership. London: Thorogood.
Wilson, J. (2010). Essentials of Business Research: A Guide to Doing Your Research Project. SAGE Publications Ltd.
Zhu, W., Chew, I.K.H., & Spangler, W.D. (2005). CEO transformational leadership & organizational outcomes: The mediating role of human-capital-enhancing human resource management. The Leadership Quarterly, 16(1), 39-52
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