This assignment will put light on the relationship between strategic management and leadership and their impact on development of an organization. Strategic management and leadership play precious role in organizational development. This report is going to focus on different strategic management theories and their implication on the development. Role of leadership will also be discussed in this assignment. The relationship between leadership and strategic management can become a key point to develop the future of an organization. Few theories will be discussed that have impact on the organizational development. The problem statement is to discuss the impact of leadership and strategic management in action on the organizational development.
Overview of the company: Big Bear Limited is a food retail company of UK. They are one of the largest food retailers of the United Kingdom. In order to develop their business they have owned few other small companies. Sugar puffs, Fox’s Confectionery, Paynes Poppets are the companies that they have owned. Big Bear got the recognition of Raisio group in earlier 2011.
1.1 Relationship between leadership and strategic management
Strategic management is done for extracting the best result from the resources, and capital of the company. In strategic management, there is discussion on the marketing, manpower and function of the company. The management need to design an appropriate strategy with the available resources and capital of the organization. They need to find out some unique and profitable strategies to develop the future of Big Bear Company.
Leadership is a part of strategic management. Leader’s job is to bring together all the group members of the company for a effective implementation of the strategic plans. Leadership is quality that skilled a person with the power of persuasion and communication. These qualities help a leader to lead their team in a efficient way (Bolman and Deal, 2014, p.245).
Leadership and strategic management have interconnection within them. Leadership is a part of the strategic management group. It does not prove that leaders can work independently. However, they need to strictly follow the strategic planning that are done by the management group. They have important role to play in the implementation of the strategic planning as posses the quality of communication. With the communication skills they can connect with other member of Big Bear company and helps to implement the planning. Leaders are flexible with strategic management; they act according to the strategic management. Relationship between leadership and strategic management are of planning and execution. Management are planning for strategies and leader’s job is to help the management team to execute it (RÄƒducan and RÄƒducan, 2014, p.810).
1.2 Impact of leadership styles on organization’s strategic decision
While making strategic decisions, leadership plays an important role. Leader’s job is to communicate other team members and make them aware of the strategic decisions that are made by the management group of Big Bear Limited. The strategies are done by the strategic management group but the leaders are the executor of those plannings. Therefore, leadership is a quality that enable a person with a communicating and negotiating skills. With this qualities leaders can communicate with different cultural people and it need to be understand by a leader that it is his duty to motivate the employees and increase their productivity. Leaders have the quality to lead the team with positive spirit and in a productive way. Therefore, in order to achieve the strategic plan of the Big Bear Limited they have to develop various types of leadership styles to support the strategic planning of the company (Hallinger, 2013, p.140).
As example, in order to increase the saleability of their product, the retail firm need to plan few strategies and campaign for the particular product. As one of the famous retail companies in UK, Big Bear Limited have different branches throughout UK. they need to hire different leaders or appoint different leaders for handling the promotional event of that product. Therefore, they need to rely on different style of leadership to achieve their strategies and planning to increase the saleability of one of their products. Application of leadership styles are done according to location of the branch and its social culture. It is also vary in terms of the available employees in particular branches. Employees are of different types, they can be hard working, skilled, productive, manageable, and bias to the company. On the other hand, they can be non- productive, poor skilled, and non-communicative. The leadership styles should chosen in terms of the quality of workers. Poor skilled employees need skilled leader to balance the productivity.
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Therefore, there are many impacts of leadership on the strategic management that can promotes the organizational workflow and help them to meet the management strategies.
1.3 Different leadership styles in different situation
There are different leadership styles that can influence the strategic management of Big Bear Limited Company. Here five of the leadership styles are to be discussed to measure their influence on strategic management. Laissez- Faire, Autocratic, Participative, Transactional, and Transformational are those five styles of leadership (Fischer et al. 2016, p.170).
Laissez- Faire: This leadership style is not providing regular feedback and information to the employees that work under supervision of this style of leadership. This leadership style fails to improve the productivity of employees. Therefore, it is not worthy for Big Bear Limited to depend on this leadership style as it can not be effective in execution of strategies planned by the management.
Autocratic: This style of leadership allows the management to take decisions alone. They are not bound to involve others and discuss before making a decision. In this leadership, style no one has power to challenge the decision of leader. It can be beneficial for the employees that want close supervision. If there are creative and skilled employees in Big Bear Limited then this leadership can beneficial (Rast et al. 2013, p.640). On the other hand, if decision is made without consulting with other members of organization the relationship between employees and Big Bear Limited will be affected. This style of leadership can be used in a situation that Big Bear Limited has no time to waste and need to take a quick decision.
Participative: Decisions are made through discussion with the employees in Participative leadership. Though the final decision is done by the leader only. This style of leadership can be highly beneficial to execute strategies.
Transactional: Transactional leadership offers the leader to receive a project and complete it with his team members. He is providing rewards or punishments to the employees according to the performance. In the case of Big Bear Limited this leadership style can motivate the employees to work effectively.
Transformational: This depends on the communication skill of the leader with management to meet the goal. The involvement of management is needed in this leadership.
Task 2 Impact of selected theories on leadership and management
Leadership and management theories are important to identify the sphere of problem, planning the solutions and execution of the planning. In order to, make strategic management different kinds of theories can be used as behavioural theories, functional theories, situational theories and contingency theory, Etc. Similarly, different styles of leadership can be used in terms of implementation of the strategies.
The changes of leadership styles depend on the feedback of employees and the revenue of the company. If the employees are satisfied and revenue of the organization is also good, then there is a point to stick to the current leadership strategy, with little changes for improvement. Moreover, if the employee's feedback and company’s revenue both are reacted against the leadership, then Big Bear Limited need to change the current leadership style of their company (Luna, 2015, p.125).
Transformational leadership: This leadership is a charismatic leadership in which the leader uses his personality and communication skills to connect with the employees to achieve the strategies. Transformational leadership have a great impact on the implementation of the strategies. If Big Bear Limited is following a differentiation strategy or a cost leadership strategy then the capital turnover will be very high and the company cannot afford that. In the same time if Big Bear Limited will follow transformational leadership then the chances of turnover will be decreased (Buckman et al. 2015, p.87).
Transactional leadership: Transactional leadership is Followed by organizations in the hope that if it is related with the self-interest of the employees than employees will perform better to achieve the organizational goal. In this leadership, the employees are not allowed to do anything but the leader’s direction. Leader is providing the direction of work and he is the responsible person for completing the given task within the limitation of time.
A leader of Big Bear Limited can contribute to the organization by creating a good organizational culture to promote the future of the company. The workers, the managers, executors all are changeable in an organization but the culture of an organization lasts for long. Therefore, leader can create a positive and clear strategy to promote the growth of the particular organization, and to help the employees and co coordinators to understand the goal and objectives better (Kark and Shamir, 2013, p.88).
For long term benefits Big Bear Limited should identify the appropriate leadership strategy for their company. They need to set few rules and standard to get a better result through the leadership strategy.
Task 3 Review of leadership and management for development
Requirement of the strategies: In order to lead the market the organization need to use few strategies as cost leadership strategies and democratic strategies as well. These strategies will help the organization to lead the market as well as focus on the customer satisfaction and quality product. In addition, these strategies are helpful to develop the future of organizations.
Big Bear Limited is required to use both cost leadership and democratic leadership for developing their future scope to do the best in their relevant market. Cost leadership strategy offers the organization to maintain the cost of the product and provide the best service to customers as well (Church, 2014, p.89). The higher authority of the company is believing in providing the best services to the service users and maintain a good relationship with them. It is helpful in retain the faithful and loyal customers and inviting the potential customers towards the company's service. In democratic style of leadership, employees are getting the opportunity to give their opinion and views that help Big Bear Limited to identify the internal errors and plan to mitigate it (Goleman et al. 2013). If the internal management is strong of an organization then the productivity will automatically increased. On the other hand, the cost leadership strategy helps Big Bear Limited to improve their position in the market and become one of the top companies of related market.
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Task 4 Report on developing methods of leadership
There are countless challenges that a leader may have to face. In that concern, it is important that a respective leader of Big Bear should understand the situation. This situation includes both internal statuses of organisation as well as current market standard (Hawkins, 2014, p.124). As it has been discussed earlier that in order to chase highly competitive market, cost leadership prospect is followed. This leadership practice reflects management scenario, but if the respective firm will change its strategy or business location, there will be a requirement of different leadership. In case of merger or acquisition of other companies or branches, a recommended leadership theory will be democratic. On the other hand, in order to maintain food quality and workflow up to the mark, Big Bear may follow commercial leadership. Practically, it is not possible always to maintain democratic leadership. In order to make desired or proper direction, respective management should specify proper leadership theory. In order to improve leadership quality, it is not only important that respective leaders should be directed in the right way, but at the same time, it is also important to engage employees in the same induction process. Without understanding the the prospects of commercial leadership, Big Bear will not be able to undertake new strategies of leadership as well as a successful strategic management.
Therefore, it is important that a respective firm should undertake proper leadership prospects just according to situation and market needs. It is not possible always that a respective leadership style may entertain all of the stakeholder groups including customers, but, the same has a stronger impact on strategic management. If strategic management has not been evaluated according to leadership needs there will be lesser options to gain organisational success.
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