Every company functions according to a set of principles without which a business would cease to exist or would fail to bring the desirable profit. A sound business is as a rule based on the pillars of human resources management, production management, product marketing, transportation, etc. Management has long ago become the key element of every company’s operation as it concentrates the power of decision-making, innovation, and progress as well as sustaining the adequate level of services provision and continuous improvement.
Judging from this point, it becomes clear that management needs to be taken appropriate care of and should be properly organized to ensure the company’s success. Every example of a successful company that has established itself firmly in the national or the world market shows that the management structure, when organized in a strategically correct way, may contribute enormously to the success of the company.
However, a set of managers should be knowledgeable not only in the sphere of management of the subdivisions they are entrusted with and should be not only superb specialists in their sphere of activity. Leadership abilities are also essential in the process of building up a successful framework of activity as they help every manager not only to stipulate the goal to which his/her team has to strive but to control the process of the goal’s fulfillment. A manager is not for sure a leader, which may be observed vice versa as well – for this reason, it is necessary that every company pay considerable attention to leadership management and leadership training.
The present work is devoted to the multi-faceted issues of leadership training, the principles underlying the establishment of high-quality efficient leadership activities, and the way these theoretical principles are implemented in the everyday operation of an enterprise. Basing the judgment on background theoretical material, the example of the Microsoft Corporation will be analyzed on the subject of its implementation of leadership management practices in its activity. The way these principles of leadership are grounded and stipulated by the company, which is responsible for monitoring the compliance of employees with the mission of leadership education- all these issues will become the central point of the discussion of the present paper.
Global business is at the stage of its development in the context of the third millennium – a new era dictating its own rules of conduct, guiding principles, and perspectives. One can observe a large-scale shift of values in business that is gradually changing its profile in the course of globalization. With the coming process of globalization, business is reshaped and changed according to the changing needs of society, which has become the key concept worth paying attention to. It is stated in the work of Al-Suwaidi (2002) that the major cause of the change in the contemporary reality is “a combination of powerful macro and micro forces: the globalization trend which is reshaping the world economy and altering the course of the world trade; genetic breakthroughs, giving rise to astounding advances in biotechnology and medicine; and the quantum revolution… are opening the flood-gates of information and revealing new vistas in lightning communication” (The Emirates Center for Strategic Studies and Research 2002).
Thus, it is not surprising anymore that business has to respond to the changing environment of the global market, doing this efficiently and promptly for the sake of survival. Humanity is now living in the information age – i.e. information and communication thereof have become decisive for the success of any undertaking, laying a heavy emphasis on the manner of business conduct and models according to which decisions are made.
Management has always been an important part of every company’s functioning because supervision being an essential part of the production process – nothing may be produced, generated, or created. In the Industrial Age, the main emphasis was made on the very process of production; however, with the flow of time, the importance of guidance of this process has been recognized, thus resulting in the changing approach to conducting business.
Information and communication technology are transforming the very concept of leadership and management, shifting emphasis from command, direction, control, and supervision to coordination, innovation, facilitation, support, and, above all, inspiration (The Emirates Center for Strategic Studies and Research 2002).
Since management was recognized as the key issue of the contemporary business reality as well as one of the most significant perspectives for its potential development in the future, many minds have become seriously occupied with speculations over how to achieve success in the given sphere. The ability to successfully manage activities, people, or processes is considered to be the privilege of the few; it is taught worldwide nowadays; however, it still remains an art particular individuals may foster and others cannot. For this reason, it is paid so much attention to with the purpose of establishing some common patterns, pre-conditions, and characteristics that would be able to promise success. Much research has been done in the field, bringing about many relevant findings that further facilitate people’s understanding of the concept and giving a set of guidelines those interested have to follow. Consequently, the concept of leadership as an essential part of forming management abilities has been discovered.
Relations between management and leadership are heterogeneous and undefined; nevertheless, their direct interrelations are undoubtedly proved. These two concepts differ in their essence however relating to one and the same major concept: the ability to coordinate certain activities and people, to make relevant decisions, and implement them into practice, thus ensuring the success of every undertaking. Connections existing between leadership and management have been thoroughly investigated and have been stipulated by Gilbert W. Fairholm (1998) as follows:
Leadership is the oldest (organizational) profession. Management is the second one. The heads of the first social groups led because they possessed the following kinds of personal characteristics – they were the biggest, strongest, smartest, the best dressed…Today most people would associate these characteristics with leadership. It was only later, when social groups became larger and more complex, that these head people began to move away from this personal kind of leadership to impersonal, objective management of the group’s resources (Fairholm 1998).
From the following citation, it becomes clear that leadership is a much broader term, but management includes it as an indispensable characteristic. Many researchers have been concerned about the interconnection of management and leadership. For instance, Timothy J. Kloppenborg, Arthur Shriberg, Jayashree Venkatraman (2003) investigate the connection between project management and leadership, the influence of leadership characteristics on the construction of correct management models; Graham Kelly (1998) focused his scientific activity on the integration of management concepts in team leadership; Robert Slater (1998) examined the way leadership and management have been successfully integrated into practice to build up a prosperous company on the example of Jack Welch, the CEO of the General Electric Company. Among numerous works devoted to the problem of correlation of management with leadership the book of Michael Wade (2002) is of high importance as it considers many significant, arguable points in the way of organizing the management of employees, weak sides of different management models, and includes a great number of theoretical and practical material that may help in the formation of the management process. One more work worth attention in the context of the discussed problem is the book of Chris Parker and Brian Stone (2002) titled “Developing Management Skills for Leadership” – the title of the work speaks for itself, as it discusses the importance of management skills, organization and supervision in the process of building up a successful leadership framework.
Summing up everything that has been said about leadership management, it is important to note that it has become a guiding principle of constructing the management framework in every enterprise and has been chosen as a chief mission of work organization. As an example, it is possible to examine the policy of exercising management in the Microsoft Corporation – the giant computer enterprise founded by Bill Gates and functioning successfully in the world market for more than three decades.
Microsoft Corporation: Company Overview
The Microsoft Corporation, the worldwide famous company that won the gigantic share in the world market and was the first to introduce personal computers at the period of time when they only started coming into use and were too sophisticated and unintelligible for the common public. The two friends and computer specialists, Bill Gates and Paul Allen created the digital language MICROSOFT BASIC and sold it to MITS, the first producers of Altair 8800, a model of personal computers (Microsoft).
The software package was a true success and the newly born entrepreneurs continued their activity in the field. At that period of time, there was no licensing protection for software and computer products, so it was Bill Gates who raised the problem and found a successful solution to it. Since 1975 the company grew and developed, Bill Gates bought the complete governance in it and became the only undisputable owner. It goes without saying that for more than three decades of its existence the company became the most successful and prosperous enterprise in the world and made Bill Gates the richest man in the world, still remaining in the first place in the charts.
Bill Gates is officially the chairman of the Microsoft Corporation that specializes in all types of computer products, including software, hardware, and the widest range of applications for home and business use. Officially “Microsoft had revenues of US$51.12 billion for the fiscal year ending June 2007 and employs more than 78,000 people in 105 countries and regions” (Bill Gates 2002).
With the company growing and expanding, there was a clear need for the establishment of an efficient management team that would coordinate the activity of different sectors and would efficiently manage human resources. There is a huge emphasis within the company made on management construction – the mission of the company is clearly characterized by the importance they attribute to nurturing, developing, and implementing the concepts of leadership into the daily practice of its administration and staff’s functioning: they recognize the fact that they are a corporation with the global-scale influence and operation worldwide, thus making the choice for being “committed to responsible leadership and to accountability for the social consequences of its actions” (Corporate Citizenship 2009). The process of implementing leadership management into the structure of the company is active and multi-aspect – they conduct multifaceted and diverse work on the overall basis and in all spheres, without any distinctions – “helping rebuild a community after a natural disaster, erecting new energy-saving buildings at our corporate facilities, or working to create a stronger framework for human rights, Microsoft demonstrates responsible leadership through policies and programs that are supported by a foundation of responsible and ethical business practices” (Corporate Citizenship 2009).
From the quotation, it becomes evident that the leadership concepts are constructively implemented in the working process of the company in all subdivisions over the world and have been put to the fore by the set of principles of corporate governance within the corporation.
The principles of management in the Microsoft Corporation are concentrated on leadership and management development. There is a department of Leadership and Management Development department within the sector of the Human Resources Department that is particularly concerned about the provision of equal opportunities for promotion and career growth for all talented, motivated, and active employees of the company. There is a set of goals the department stipulates as the mainstream direction of its activity in the context of the implementation of leadership management: “(a) grow the skills that make leaders more effective in their current roles, while at the same time preparing them for upcoming challenges; and (b) create a pipeline of talent throughout the employee population” (Human Resources/Leadership &Management Development 2009). For this reason and with these goals the employees and the administration of the department recognize the key importance of correct organizing of training and learning activities.
The department is of great importance in the structure of the company, making a huge contribution to the working process, innovation, and increasing the productivity as well as the creative potential of the corporation. The department consists of a Leadership Development Consultant whose responsibility is to define the necessity of building up leadership development and promotion in the way potentially profitable for the company together with applying these theoretical decisions into practice by arranging the learning process accordingly, and the project coordinator who takes up the practical side of the task – implementing theoretical findings concerning the management of leadership development and monitors their being out into practice, helping participants communicate and collaborate (Human Resources/Leadership &Management Development 2009). These people provide the contents of the work directed at the promotion of leadership management and introduce the new practical and theoretical concepts into the whole company’s operation.
Individuality, encouragement, inspiration, and overall involvement of employees in the work of the company are the chief objectives on which the management work is oriented. The employees are “committed to hiring the best people and providing an inclusive, caring, and creative environment that enables them to do their best work” and show this commitment in their everyday practice – in communication with the inside personnel of the company as well as the outer clientele (Corporate Citizenship 2009).
A good example of the extensive activities directed at leadership promotion and management in the Microsoft Corporation is the Senior Director of Leadership, Employee Development, and Management Sabina Nawaz. She started her own business in 2005 but had been working for 15 years in the Microsoft Corporation before that. During her career in the discussed company, she took an active part in the development of leadership programs, coordinating the activities connected both with the discovery of new talents within the company and with the promotion of already defined leaders.
Recollecting her activities as the Senior Director of the department specializing in handling the leadership management promotion within the company Sabina assumes that she had worked out her own strategy of managing leaders. She based her work on several principles that made her work multifaceted and efficient. First of all, she perceived the issue of leadership at all stages of its existence – first of all, she understood that leaders have to be identified and distinguished in the multitude of the company’s employees. Once this was done, it was essential to use the potential of the company to help the person realize him-/herself and open the potential for the benefit of the organization. For this purpose, she established a set of leadership development programs with the purpose of monitoring the personnel on the subject of identifying workers with leadership potential (Sabina Nawaz 2009).
Another direction of her activities was surely oriented on the existing leaders within the personnel of the company – she recognized the necessity of continuous work on encouragement, promotion, and nurturing the leadership qualities with them for the sake of the success of their activities. Sabina admits that the key point in the success of the leadership department activities is constantly pushing the leaders in the process of their work, playing on their strong sides and advantages they may offer to the company, upraising their self-esteem, and taking an active part in their beginnings (Sabina Nawaz 2009).
She also argues that it is essential to encourage leaders to establish long-term relationships with the company and direct them to the future they have with it, but not focusing on the present events even if some of their actions lead to failures or losses. Sabina as a professional in the sphere of leadership management development made a wise and original conclusion that the existing leaders in a company should be consistently monitored on the subject of their satisfaction with the job they have and all conditions they are offered at the workplace place. She put the continuous satisfaction of employees, especially the leading part of it, to the fore because of this part of the person being the most attractive for competitors and bearing the highest potential for the company’s present and future (Sabina Nawaz 2009).
It is notable that Sabina had been actively working on the promotion of gender equality of opportunities within the company during her being in office – she recognized women’s abilities for sound leadership management and persistently fought for the right to self-realization for women. The Microsoft Corporation is famous for gender equality in the issues of provision of career opportunities even now – Joanna L. Krotz, the author of the article “Do women make better managers?” published within the Microsoft “Articles and Insights” section stipulated the key findings regarding the potential in leadership management women have:
Women tend to be better than men at empowering staff; women encourage openness and are more accessible; women leaders respond more quickly to calls for assistance; women are more tolerant of differences, so they’re more skilled at managing diversity; women identify problems more quickly and more accurately; women are better at defining job expectations and providing feedback (Krotz 2009).
In general, corporate governance is soundly organized within the company’s structure, including the Board of Directors and the Board Committees. The work on leadership management is constantly conducted through varied training and learning programs; what is more important is that the administrative staff of the company pay equal attention to the development of opportunities of already existing managers and conduct constant searching for new potentially profitable leaders with high potential.
Proposal for Improvement
After conducting the detailed review of the activity on leadership management organized within the structure of the Microsoft Corporation it is possible to make a conclusion that the corporation is very attentive to the development of its staff’s potential through recognizing leadership management as the most effective and profitable model of management construction in the company.
The company is very large, having many regional and international subdivisions functioning nearly in an autonomous way; for this reason, there is still a risk to lose the close ties between the company’s subdivisions and creating certain discrepancies in the compliance with the initial mission of the company. It is essential for the Leadership Development Department to coordinate their activities on all levels, to continuously organize training and educational seminars and meetings to ensure that the overall mission in terms of leadership management promotion is adequately understood, pursued, and appreciated by all regional and local subdivisions.
As a practical proposal for improvement that may be offered to Microsoft Corporation, it would be a significant breakthrough to establish a unified committee on leadership management that would act autonomously and would investigate the latest theoretical and practical findings of researchers in the given sphere, to build up a common scheme of leadership promotion that would be spread as obligatory guidance in all local and regional subdivisions of the company as well as on the international level. One more innovation that would prove efficient would be the international exchange of experience and cooperation of leaders of high level in different subdivisions of the company – it would provide not only leadership qualities enrichment but also cultural exchange that would open new horizons for applications of leadership management in different spheres of operating the company.
Compliance with the generally stipulated goals, coherence, and homogeneity in the pursuit of one common goal – to raise the potential of the company through the development, recognition, and involvement of leaders in all spheres of its activity – has to become central in the working process making the profile of the company much more attractive to shareholders and consumers.
Leadership management has become one of the central issues for recognition and consideration in the context of successfully conducting business affairs in the third millennium. Leadership and management used to be considered pertaining to different spheres of human relations and social influences. However, with the flow of time and in the process of deep, multi-faceted research in the sphere the importance and close connections of both concepts have been confirmed, thus opening a new platform for activity both for researchers and the business owners wishing to increase the potential of their company and ensure its successful future. As one can see on the example of one of the most successful companies in the world, the Microsoft Corporation, heavy emphasis on leadership management, sound and sensible organization of work concerning the development of leadership qualities within its staff and strengthening the self-esteem of already defined leaders has been yielding highly productive results for more than 30 years, continuing the same positive tendency.
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