Leadership and Management Relations Analysis

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Leadership

Leadership is a very important skill that is not possessed by all; hardly very few people are blessed with this skill. Being a leader is not easy; it poses many challenges and the person who overcomes these challenges makes a successful leader. A leader instills confidence and provides motivation to the employees, motivation is an extremely important factor and motivation can easily transform an employee within no time, once the transformation of the employee takes place, the goals of the company would become much easier to achieve. This is why motivation is considered to be one of the most important factors and all most all companies look for new methods to motivate the employees and to bring the best out of them. This paper will focus upon what leadership is all about and how leadership is different from management.

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One of the biggest challenges faced by leaders these days is getting the right people for the job, any job can be completed by anybody but the point is how efficiently a person can do a job? Leadership is all about perfection and any wrong decisions taken can prove very fatal. For instance, a leader hires a person, who he believes is the right man/woman for the organization but the work of that employee proves otherwise, the organization can suffer because of the same and the loss occurred because of that wrong decision of the leader will always remain irrecoverable. It is very difficult these days to find the right people, who can commit their future to the organization but leaders are expected to have the quality of differentiation, a leader who possesses this quality can never go wrong in the process of selecting the right people for the organization. The quality of differentiation is very difficult to instill in a leader, this is something which should come naturally to the leader, no educational institution teaches this quality and it cannot be learned anywhere and it is purely dependent on instincts. A leader should always differentiate the right people from the wrong people in order to succeed in his/her endeavors. This is one of the biggest challenges which leaders these days face, if a leader is born with this quality then major pitfalls in leadership can be avoided without facing many difficulties.

The managers need to take up multiple roles and this will ensure the satisfaction of many demands. Henry Mintzberg has given a comprehensive guideline that consists of ten roles that are common to the work done by all managers. These roles are further divided into groups, interpersonal, informational, and decisional. The role of information ensures that every manager is aware of what the other manager is doing. The interpersonal role is largely responsible for providing the information and ensuring that every manager is well aware of what is going around them. The decision role makes use of the information provided by the interpersonal role and the process of decision-making starts. The performance of managerial roles and the requirements of these roles is usually played at different times by the same manager and to different degrees and it depends on the level and function of management.

Another big challenge that the leaders of today face is the daunting task of decision-making. Decision-making is the most challenging task for any leader. One wrong decision can change many things around in an organization and those changes will surely be for the worse of the organization on the other hand one good decision can help the organization in more ways than one. Decision making is a very delicate process, numerous things have to be kept in mind, a leader just cannot go on making wrong decisions because that would result in disaster, even one wrong decision can be disastrous for any organization so considering all these things it becomes imperative that leaders analyze the situation and make their decisions wisely, if a leader analyzes a situation, naturally he/she will be able to make right decisions so analyzing the situation is a must for any leader to avoid making a hasty decision.

Management

Management mainly involves five functions namely, Planning, Directing, Staffing, Organizing and Controlling. Management focuses upon achieving the goals set by an organization and achieving goals is quite a difficult task that involves numerous complexities. To reduce those complexities the above five most important functions of management are followed; of which controlling is one of the most important functions.

According to Henry Fayol, “Control consists of verifying whether everything occurs in conformity with the plan adopted, the instructions issued, and principles established. Its object is to point out weaknesses and errors in order to rectify [them] and prevent a recurrence.” The main focus of the controlling function is to make sure that everything is going according to plan and whatever is not going according to plan is fixed up as soon as possible. The modern-day function of controlling has become very advanced; the managers are required to have the skill of foreseeing the events which are going to take place; on the other hand, the function of controlling was only brought into effect after the problems were detected before the introduction of the modern functions of control. When a Manager adopts the method of controlling, he/she should make sure that it is done regularly because controlling is a continuous process and should be carried out regularly in any organization. Another important feature of control is that it is closely interrelated to Planning, under the process of planning, the goals are set for an organization, and the function of controlling makes sure that those set goals are achieved in this way these two functions are interrelated.

A Very Well Controlled Company

Reliance Anil Dhirubhai Ambani Group is one of the most popular and successful company in India. The company is extremely well controlled and not only is it well controlled but also the company exceeds the expectations of the shareholders every year. This goes to show that the company follows the principles of management very carefully be it planning, controlling or for that matter staffing. The Reliance group was earlier headed by the Late Dhirubhai Ambani, father of Mukesh and Anil Ambani and the company has been split into two now, both the brothers came to an unanimous decision to split the company into two. The company which is being talked about here is headed by Anil Ambani, the company is into more than one sector and every sector is very well controlled by Anil Ambani the Managing director of Reliance Anil Dhirubhai Ambani Group. The company is into Capital, communication, entertainment and power. Anil Ambani is one of the richest people in the world and this is all because of his management skills. He has put efforts in making sure that the principles of management are stuck to by his company. The company is very strong financially; the company recently reported a quarterly profit US$ 14.2 and this speaks volumes about the controlling process going on in the company. It can be made out how good or bad the controlling process is by the annual results of a company and in this case it is very certain that Reliance Anil Dhirubhai Ambani Group is very well controlled. “Reliance Natural Resources Ltd (RNRL), part of the Anil Dhirubhai Ambani Group, has posted a net profit of $17.14 million (Rs.686 million) during 2007-08 as compared to $7.21 million the previous fiscal.” (Reliance Comm). It is very clear from the stats that the company is very well managed and the controlling process especially is very well taken care of.

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An Average Company is following the Function of Controlling India Infoline is another good Indian company and in the context of controlling it can be said that it is an average company.

“The India Infoline group, comprising the holding company, India Infoline Limited and its wholly-owned subsidiaries, straddle the entire financial services space with offerings ranging from Equity research, Equities and derivatives trading, Commodities trading, Portfolio Management Services, Mutual Funds, Life Insurance, Fixed deposits, GoI bonds and other small savings instruments to loan products and Investment banking. India Infoline also owns and manages the websites www.indiainfoline.com and www.5paisa.com. The company has a network of 758 business locations (branches and sub-brokers) spread across 346 cities and towns. It has more than 800,000 customers.” (India Infoline)
The company is basically into the Stock market and it can be said that it is an average company in context to controlling because the net profit of the company was recently reported to have dipped by 2.5 % compared to the profit which the company had got previously. So the financial activity of a company is a good enough indication of how good or bad a company is when it comes to determining the controlling aspect of the company. Hence by looking at the recent financial results it is very fair to say that the controlling aspect of India Infoline is just average when compared to Reliance or for that matter any other big company.
“India Infoline has been awarded as the ‘Best Broker in India’ by Finance Asia magazine in its annual study of best financial services firms in each country Asia.” (India Infoline). A well-controlled company makes good decisions in order to accomplish its goals and as it can be clearly seen from the above quote that India Infoline has made some really good decisions in order to get the Best Broker Award in India. Another good example which will prove that the company is a very well controlled company is as follows, the company takes care of 8,00000 people distributed in 346 various towns and cities, it has got a very big customer base and this clearly shows that the company is very good at the controlling functions. Despite having such a huge customer base the company still bagged the not broker award which speaks volumes about the success of the company.

A Company with poor Controlling Function

The airline sector in India is estimated to be suffering a loss of $ 1 billion and almost all the companies have been very adversely affected because of this. Spice jet is one of the biggest losers. The loss is expected to be somewhere between $ 3 to 3.5 Million. The loss is huge and it is because the controlling function was at fault, their inefficiency to oversee future events cost them dearly. “The consolidated figure included a loss of $ 5 Million on account of restatement of forex debt. The net figure, excluding the loss on foreign exchange. Incidentally, the company’s profits of Rs $ 38 Million last year, were solely on account of foreign exchange gains. The losses were a result of higher fuel prices, which more than doubled in the quarter. This is despite the rise in the average ticket price of 37 percent and the rise in the number of flights by 39 percent.” (Spice Jet). The fuel prices are at an all-time high and this has severely affected the airline Industry and this case is not only exclusive to Indian airline companies but also is seen in the other airline companies all across the globe. A very important point that should be observed here is that if a manager fails to oversee future events, it can lead to disastrous circumstances and the same is proved with the help of the Spice Jet example.
The company has made some of the most comical errors since they have started their service; the controlling function is outlined here because a good company, where the function of controlling is intact never makes fatal errors. A passenger quotes “I had to cancel a ticket with Spice jet which resulted in $ 220 sitting in the account with Spicejet. When I tried to book another ticket using this amount, they asked me for Rs 2400 more than the fare available online for the same ticket saying that that’s the way their system works!” (SpiceJet Complaints). The company is supposed to be in the service industry and the more it offends the customers, the dire the consequences will get for the company. The quote and the financial figures clearly indicate that there is something wrong with the management of the company and especially with regard o the controlling function.

Conclusion

The paper threw light upon management as well as leadership, several examples of various companies have been mentioned in this paper. Management is all about staffing, controlling, etc. but leadership is all about constantly motivating the people and getting the best out of them. Management is further subdivided into various parts and this is not quite the case with leadership. The differences between the two have been clearly pointed out in this paper.

References

About Us. In Indiainfoline. Web.

Henry Mintzberg, The Nature of Managerial Work, Harper & Row, 1973.

Howell, JP, Costley, DL 2000. Understanding behaviors for effective leadership India Infoline. In Economic Times. Web.

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Loden, Marilyn, Implementing Diversity, San Francisco: McGraw Hill, 1996.

NMSU Professors. In nmsu.edu. Web.

Reliance Comm. In Reliance Watch. Web.

Straight from the Gut. In Welsh Way. Web.

Spice Jet. In Business-Standard. Web.

SpiceJet Complaints. In Complaints Board. Web.

Henri Fayol (1949). General and Industrial Management. New York: Pitman Publishing, 107-109.

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