Discuss about the Impact of Leadership on Organizational Performance.
As argued by Northouse (2015) the stronger and efficient the leadership within an organization the better would be the performance of the organization. The primary objectives of the leaders is to ensure that they are able to extract the best out of others in a way where contribution is made proactively and willingly. There is no force or coercion involved in the process and that it what makes it successful in the long run. The concept not only targets the achivemnt of organizational objectives but also personal development of employees. This paper focuses upon the review of relevant literature in relation to leadership and Organisation performance. The papers critically analyses Peer reviewed journal articles in relation to leadership and organisational behaviour in order to conduct and appropriate literature review on the research topic. The actual meaning of leadership as provided by various renowned researchers as discussed through this paper. The paper also analyses the impact of different leadership behaviour and styles upon organisation behaviour and subsequently upon organisation performance. The paper provides an overview of how good leadership skills and behaviour enhances the performance of employees within the organisation by appropriately motivating them to achieve organisational goals and personal development.
Definition of leadership
As defined by Northouse (2015) the process of influencing other individuals towards working willingly for the purpose of achieving organisational goals is known as leadership. In general the definition of leadership simply includes the process of motivating people towards directing their efforts for the purpose of achieving a common goal or goals. According to Nahavandi(2016) leadership is an art of motivating people so that they willingly strive towards achieving group goals. The concept can also be enlarged to bring within its area not only the element of willingness but also to work with confidence and zeal.There are various definitions of leadership.
Leadership has been defined by Fairhurst and Connaughton(2014) as a simple act of motivating others to attain a goal. Antonakis and Day(2017) defines leadership as the process of influencing on making people to perform certain actions for the purpose of achieving specified objectives. Rather than letting things happen leadership is an act which focuses on making things happen. This is done by the leader through the exercise of both intrinsic and extrinsic influence in relation to the group (DuBrin 2015). It is the fact that leadership is one of the most visible functions of Management as it deals considerably with employees. The concept has been broadly referred to as commanding, inspiring, guiding, activating and initiating employees directly to achieve a common goal (Beck and Cowan 2014). Out of all striking features leadership suggest relationship through which the behaviour of an individual is influenced by another. To various authors leadership has different meaning. A few others have defined leadership as a simple term like influence, the process or art of influencing others so that they strive enthusiastically and willingly towards achieving group goals (Priest and Gass 2017). However these definitions have to be brought together in order to derive an appropriate meaning of the concept.
The primary emphasis of the definition of leadership is that people should ideally be encouraged to develop willingness to work along with incorporating zeal and confidence in their activities. More specifically leadership has also been defined as use of power in making decisions exercised through the virtue of personal knowledge, attribute of position or wisdom. Zwingmann et al. (2014) has stated that leadership is a social influence method through which voluntary participation of subordinates is looked for by the leaders towards an effort of achieving organizational goals. In the same way leadership has been defined by Zhang and Inness(2016) as an interpersonal influence which is directed through communication and exercised in situation for the purpose of achieving a common goal. The implications of variations is required to be analyzed.
Irrespective of all different variations in relation to leadership there are three significant implications which can be derived from them. These suggest that leadership is the method which is indulged into by some individuals. It is a continuous activity within the organization. The process involves others who work in form of subordinates and are influenced by the leaders by their own willingness. Finally, the purpose of leadership is to achieve objectives and goals (Daft 2014). The concept of organization performance have to be analyzed in the light to leadership to establish a connection.
Concept of organization performance
Organization performance signifies actual results or output of the organization against what is intended. The primary output of organizational performance is measured mostly through market performance, shareholder performance and financial performance. It has been argued by Mittal and Dhar (2015), that only when every part of the organization works together to achieve its objectives can the organizations attain a high level of performance. On the other hand it has been stated by AlKindy, Shah and Jusoh (2016) that organization performance depends on allocation of resources. The performance of an organization is dependant largely on the level of performance of the employees. Motivated and hard-working employees have the potential of enhancing the level of productivity within the organization. When employees have high level of motivation they put additional and enhanced efforts in relation to the organization which subsequently enhances it performance. On the other hand when the employees are forced to put additional effort against their will they would be reluctant to do so and this may have an adverse impact on organizational performance. In addition it has been provided by Syrek, Apostel and Antoni (2013) that organizational performance depends largely on organizational culture which is maintained throughout the workplace. Proper guiding principles and flexible organizational culture can ultimately direct the employees towards improved organization performance. The connection between leadership and organization is inevitable.
Leadership and organization
Leading is a method which influences and directs the working of an organized group to accomplish goals through proper communication. Thus the concept is premised upon interpersonal skills and the leader has to be a part of the group. This implies that the concept of leadership thrives in an organization. As defined by Klenke(2016) an organization included two or more people who exist of on an ongoing basis having an intention of achieving prescribed goals.Leadership has a direct impact on the elements within an organization.
There are three major elements which every organization consists of which are mainly people, management and tasks. These elements have to interrelate in an effective manner so that the objectives and goals of the organization may be achieved. Leadership is included in the function of management and is related to the ongoing search of the most effective method of influencing subordinates to accomplish objectives and goals (Ciulla 2014). It is an ongoing process of coordinating money, material and man. Leadership includes the sum of behaviour of the executive in their direct relations with the subordinates. As the body of leadership, management determines rules, policies and procedures guiding activities and relationship within an organization which determines the effectiveness of achieving its objectives and goals to an extent(Lussier and Achua 2015). Where there is interaction between two or more people an environment towards the formation of a group is formed. When the people in the group co-exist and indulge for common purposes and persist for a sufficient period an organization is developed (Cashman 2017). The purpose of a leader within the group is to give directions, manage the activities of the individuals and maintain consistency. Leadership has to be effective.
The effectiveness of leadership skills and the image of the leader are depicted through the manner in which the subordinates go through with their tasks. Therefore the leader while using their organizing power decided the manner of task operation, ethnic and work behaviour of the subordinates (Arnold et al. 2015). Leadership is crucial to corporate excellence and employee performance. Consequently a substantial sum of money is spent by organizations towards looking for proper leadership training in relation to their personnel. In addition effective leadership is relatively scarce and thus organizations look for it on an ongoing basis so that they can develop leadership potential within those who are associated with the management of the organization.The style and behavior of leadership can be used to derive its effectiveness.
Leadership styles and behaviours
Leadership styles and behaviours is the process through which leaders carry out their functions as well as the manner in which manager behave with the individuals within their group. It has been stated by Breunig(2014) that there are various dimensions in relation to leadership and several possible ways of explaining leadership styles like unitary, dictatorial, charismatic, consultative, abdicatorial and participative.
However the manner of managerial leadership in relation to subordinate staff and emphasis of power is classified between three-fold heading which are:
Autocratic leadership
An autocratic leader as defined by Yang, Huang and Hsu(2014) is a person who is ultra conscious of his position and has little faith or support in his subordinates. He has a feeling that payment is only a reward for the work done by employees and only rewards can be used for motivating them. It has been suggested by Butcher, Bailey and Burr(2016) that the use of autocratic form of leadership is best in relation to a situation of emergency, where the work force is homogenous, where the leader is just, wise and considerable. A few short coming of autocratic leadership has also been defined by Castelli, Marx and Egleston(2014). Autocratic leadership prevents the subordinates to develop pride of accomplishment, denial of personal satisfaction or development from self actualization and also rubs the organization of lasting co-operation and loyalty and antagonizes human beings (Samad et al. 2015).
Democratic leadership
A democratic leader allows for shared decision making within the group. Praises and criticism are given objectively and within the group a feeling of responsibility is developed. It has been argued that the form of leadership originated before all other styles of leadership. Before issuing general or broad orders the managers indulge in discussion with their subordinates and thus they feel free to act upon them. Opportunities are allowed by the superior to the subordinates to make contributions and use their initiatives. Support is provided by these leaders to the subordinates in relation to task performance (Öztekin, ??çi and Karada? 2015).
Laissez-faire leadership
Laissez-faire leadership is contrary to the autocratic leadership style. In relation to this form of leadership an attempt is made by the leaders to pass the responsibility of the process of decision making. The leader in this type of leadership lacks confidence in his leadership activities and thus the group is loosely structured. Under this leadership decision making is done by any person who wishes to accept the responsibility. The process of decision making in this form of leadership is very slow (Borman 2014). A leader in order to be successful must possess a few specific qualities.
Qualities of a good leader
There are certain qualities of a good leader which makes the leadership activities performed by him more effective than the other. These qualities are discussed in this part of the paper
Dedication
The performance of the organization depends upon the extent of commitment provided by the leaders in relation to the objectives and goals of the organization the measure of dedication is done through tee be of work done along with its efficiency. The function of leadership thus consists of complete commitment and self-sacrifice (Roueche et al. 2014).
Communication
A good leader has to posses adequate communication skills in order to influence those who are working under them. When a leader possesses good communication skills he or she is able to effectively make the subordinates known about what is actually expected form them. This also helps the leaders to get proper feedback from the subordinates to enhance performance (Zwingmann et al. 2014).
Human relations
This skill is also known as the skill of interpersonal relationship. A leader should posses a strong human relation attitude specifically in situation where the actual job is done through subordinates. Understanding and developing proper human relation skills provides the leader healthy respect (Zhang and Inness 2016)
Crisis manager and effective decision maker
A leader must have the capability of resolving issues between the employees which may have an adverse impact on organization performance and productivity. They must also posses the ability of strategic planning which depends on effective decision making. In contemporary management effective decision making includes avoiding defensiveness andcollecting information about utility and cost in relation to every alternative and systematically comparing them to make an effective decision (Mittal and Dhar 2015). Leadership and management are not the same concept.
Leadership and management
One of the most general misconceptions in relation to leadership is confusing it with managership. Although a few scholars regard leadership and managership as synonym, it cannot be considered appropriate. Leaders as a matter of fact may also be found in a group which is completely unorganized but managers only exist in an organized organization where such roles are created. However these two terms cannot be differentiated entirely from each other. It has been argued by Jyoti and Dev(2015) that although these two terms are not synonymous the largely overlap each other as both of them strive to achieve objectives and obtain results from people. The process of management includes the effective and efficient use of resources and good administration. It addresses maintenance of systems, administration, installation and control of finance. It considers people as human resources and things and not as person. Leadership is in relation to providing directors, inspiring others and building a team.
Transformational leadership
For getting the success of the organization the contribution of high performance employees are vital. In order to ensure that employees ensure high performance it is important for organizational leaders to inspire and motivate employees towards going beyond basic tasks requirement. The objective of transformational leadership is to promote consistent visions, missions and values of the organization to the employees. They have the potential of inspiring people to achieve remarkable results beyond what is normal. As stated by Moriano et al. (2014) transformational leaders work with the employees to determine the changes requires to be brought in place to enhance the performance of the organization. In addition these kind of leader communicate clearly the vision of the organization to the employees so that they can be effectively aligned with organizational changed. They tend to take various risks for attaining the success of the organization. However it has been argued by Zhu et al. (2013) that excessive risks which have been taken by transformational leaders may be detrimental and destructive for the organization. To the contrary it has been said by Jyoti and Dev (2015) that some level of autonomy is provided by transformational leaders to the employees in relation to particular jobs. In addition enough authority in relation to decision making is provided to the employees in relation to their own work once they are capable enough through this form of leadership.
Conceptual Framework
While conducting the literature review it can be stated that leadership is associated strongly with enhanced organizational performance. Employees are the units through which it is determined whether an organization is able to perform well or not. The employees are the core of the organization and organizational performance is directly proportional to the performance of the employees. Organizational leaders provide encouragement to the employees to take challenging tasks in order to face the dynamic conditions of the market. In addition shared values are promoted by the leaders among the employees in relation to organizational objectives and goals. Transparent objectives and goals communicated among the employees in reality enhance the performance level of the employees. In addition, some authority is also delegated by leaders to the employees which allows them to participate in the organizational decision making process. It enhances actually the worth of the employees along with their satisfaction level within the organization. Leaders take into consideration innovative solutions for addressing complex organizational problems. It incorporates organizational innovation and increases organizational performance
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