Leaders Make a Real Difference in an Organisation’s Performance
Leadership is the process of influencing other people in a certain organisational setting to achieve certain set goals. According to Ram and Prabhakar (2010), leadership is leadership is an aspect that largely influences the performance of an organisation and the attitude of employees and managers. A leader is someone who pushes others to achieve certain objectives. Leadership is of paramount importance in organisations. Leadership in organisations is different from management (Gallos, 2008). Leadership should not at any given time be confused with management. While management is the application of management functions like planning, organising, staffing and control in order to achieve organizational goals, leadership has an emotional aspect to it that plain management does not. Good leadership emotionally compels motivates and encourages individuals to perform. This means that leadership and management are complementary aspects in the efforts to achieve organisational performance (Ram & Prabhakar 2010).
It can be noted that leadership appeals to the emotional part of employees in an organisation. It is the dialectical process that incorporates a proactive aspect. This is where the members of an organisation are persuaded to perform what they had not planned to do. Leaders shape organisational events naturally through their influence, actions, and personal attributes. It is wise to note that leaders have a special relationship with their environment. In this case, leaders and environment impacts on one another. Therefore, leadership is about change in ways that will benefit the organisation (Ram & Prabhakar 2010).
Organisational performance is total output that an organisation gives in relation to the expected output. The performance of an organisation is what determines whether or not the organisation is making progress and whether goals and objectives are being met. The output of an organisation is determined by various factors with the major one being employee attitude and the leadership system in place in the organisation. Employees’ attitude towards their supervisors and the work they do is very crucial, and it determines their performance (Ferris 1985). Thus, leadership plays a very important role in the general output of an organisation. This essay seeks to outline the influence that leaders have in the ultimate performance of an organisation and how they do it. It brings out the qualities that leaders possess which help them perform their functions. On the contrary, leadership has been found to have an adverse impact on the performance of organizations (Emery & Barker 2007).
Constituents of organisational performance
Organisational performance can be seen in the output of a certain organisation in certain aspects. These aspects include; the profits it makes, the flexibility of the organisation, the market share it has and whether it is increasing or decreasing, production of labour, customer satisfaction, employee satisfaction, innovation and creativity, acquisition of resources and the safety of its stake holders. Any organisation that is not making profits has no business conducting business. A major goal in organisations is to make profits. However, when this does not happen, it is only a matter of time before organisation burns itself out. Change is compulsory in the business world, and an organisation should be flexible so as to adapt to the changes. This is meant to ensure its customers are satisfied and that they keep coming for more services. Competition should never be undermined. The performance of the organisation should always be at its best in order to ensure that the market share continues growing; otherwise rivalling organisations will take over. Employers are very important to the organisation. In as much as customers are the lifeline, the organisation should understand that employees hold this lifeline. Stress in the work place will cost an organization significantly since it has a negative impact on the employees (Paoli 1997).
Therefore, human resource management in any organisation should be diligent to ensure that the employee needs are considered by the management and that the employees are contented. When employees are not contented, they may react in subtle ways to “pay back” the organisation. Such ways include playing truancy and deliberate and unwarranted absenteeism, among others. Such occurrences may cost the organisation a lot (Mayfield & Mayfield 2009). The organisation should also see to it that the think tanks within it are always coming up with new ideas and innovations. This will keep the organisation a step ahead of its competition. The management should also ensure that all resources required of outstanding performance are present. Safety of all stakeholders within an organisation is also very important. Apart from just avoiding high compensation and insurance fees, it serves as motivation to the employees to know that the management cares for their welfare; hence they produce better results out of appreciation (Emery & Barker 2007).
Perspectives of leadership that influence organisational performance
One thing about leadership is that it does not have to be formal. Nonetheless, it is about the ability of an individual to influence others’ performance in their areas of specialisation. In any organisation, there are those who may not be in managerial positions but have the power to encourage other people around them to produce better results. If such people lack in the management team, then the organisation lacks in the sense of direction. Management without leadership might not directly impact on the performance of the organisation. If this is the case, the management does not matter to the organisation life since it does not influence it in any way (Staw, Cummings & Sutton, 1979). Organisational performance is not about protocol; it is about constant improvement and the desire by the people involved to continually producing better results than before. That is the effect that leadership has on organisational performance.
Leadership has certain perspectives that mandate an individual to lead others within an organisation. These perspectives are; trait perspective, behaviour perspective, contingency perspective, and transformational perspective. Traits perspective has to do with intelligence, alertness, confidence, and responsibility. These are the traits associated with leadership. Behaviour perspective has to do with attributes like discipline, self-control, and ethical issues too. Contingency perspective constitutes of theories like situational theories, leadership- substitute theory and path-goal theory that define and describe good leadership (Emery & Barker 2007).
Benefits of leaders in an organisation
The best way to find out the benefits that leadership has in an organisation is by comparing the aspect of leadership with that of management. This will differentiate all the organisations that have management functions and those that have good leadership alongside this management. Leadership is the factor that pushes an organisation the extra mile that management cannot. For one while management maintains the status quo in an organisation, leadership creates vision and a realistic goal for the organisation to follow. This gives an organisation a sense of direction and encourages the members of the organisation to work toward the vision (Gill, Mathur, Sharma & Bhutani, 2011). It also helps avoid monotony of ideas and routine, which sometimes can demoralise employees. Also, while management seeks to create consistency and order in an organisation leadership creates change and initiates movement towards the achievement of goals. Leadership allows members of an organisation to express their freedom within sensible confines of set rules and regulations which encourages innovations from the employees and benefits the organisation. Another difference is that while management seeks to do things right, leadership sets out to do the right thing. Leadership takes into account the feelings and emotions of its members such that even when decisions are made, their impact on individuals will put into consideration as well as the organisation’s benefits. Leadership is just not after profits for the organisation but for the welfare of the employees too (Wood, Zeffane, Fromholtz, Weisner & Creed, 2010).
Finally, with management, relationships are transactional. On the other hand, with leadership, relationships are transformational. Transactional relationships are whereby the employees are rewarded if they perform well and threatened with a penalty when they fail. However, transformational relationships are characterised by a leader inspiring trust, the motivation to perform, and loyalty in the employees (Zagoršek, Dimovski & Škerlavaj, 2009). While transactional relationships compel s employees to perform, transformational ones inspire them. When leadership seeks to have psychological contract with the members of the organisation and inspire them, the performance in the organisation improves because employees give their very best. Therefore, effective leadership means interacting with the employees in an organisation and listening to them. This way, a leader will understand the strengths, weaknesses, opportunities and challenges within the employee group. With such knowledge, management becomes effective. This is because the management easily identifies the various aspects that it is handling (Wood, Zeffane, Fromholtz, Weisner & Creed, 2010).
How leadership influences the performance of an organisation
Leadership greatly influences the performance of an organisation. Without it, an organisation will just be following protocol and routine. Such an outlook towards work will not improve the performance of an organisation in any way. On the contrary, performance will go down or stagnate. Thus, leadership works as a motivator to make members in an organisation want to work hard and produce good results. Leadership improves performance in several levels in an organisation. It improves in the creation of organisation agenda, development of strategies to achieve organisational agenda, implementation of the agenda, and the end results of the implemented agenda (Staw, Cummings & Sutton, 1979).
Creation of organisational agenda
Normally, when agenda in the organisation is made, plans and budgets are made where intricate timetables and steps are implemented to achieve the desirable goals and the appropriate resources are allocated. When leadership is employed, there is a sense of direction that is established to guide the creation of timetables and steps for the agenda. Leadership provides definite strategies for achieving these goals. With leadership, it is easy to envision the future of the organisation and the implementation of the agenda. Leadership makes goals and objectives seem achievable and motivate the members of the organisation. Employees tend to respond to personal qualities of the persons directing them. Their attitude towards a certain agenda or objective is highly determined by the perception they have of their leader (Emery & Barker, 2007). This means that good leadership will portray the objectives and agenda of the organisation to employees and inspire them to perform.
Development of strategies
After plans have been made, management of organisation develop set the agenda by organising staff, develop policies that will guide employees and design control strategies to ensure that everything is done according to plan. Where leadership is concerned, more communication is done on the agenda in question to the members of the organisation. Communication goes a very long way in ensuring that set goals are achieved (Gill, Mathur, Sharma & Bhutani, 2011).
Implementing the agenda
At this stage, the organisation applies control on the implementation of agenda. Deviations will be established, and solutions sought in the implementation of an agenda. When leadership intervenes, it brings about motivation and energizes people to work harder and beat challenges (Gill, Mathur, Sharma & Bhutani, 2011). Implementing agenda in an organisation is not simple. Challenges are sure to come and try to thwart the efforts of members of an organisation in achieving the set agenda. While organisations try to apply policies to rectify the weaknesses, leadership seeks to encourage the demoralised employees (Lawrence, 2010).
The ultimate result in an organisation is determined by the management in place. Performance results are determined by how the employees work. Where good leadership is non-existent, the result of the implementation of the agenda is what has been predicted by the management. The results produced by such an organisation are what the stakeholders expect. However, leadership gives unexpected results. This is because leadership is about change. A leader is an agent of change in an organisation. In this case, a leader can influence the performance of individuals in the organisation to perform far much better than the expected. A leader influences employees to tap their potential to the fullest by inspiring them. Dierendonck, Haynes, Borril, and stride (2004) attest that a leader can affect the way in which employees perceive themselves and their work. This means that a leader has the power to create or destroy an organisation. Good leadership encourages employees to give their best and also encourages talent. This brings about new ideas and innovations that assist the organisation be more efficient and produce new products that are better. Therefore, leadership brings about change that is new and extremely useful to the organisation (Ferrell & Ferrell 2011).
Despite the fact that leadership has many advantages, there are few elements of leadership which adversely affects the performance of organizations. Ferrel (2011) opines that leaders do the right thing, but in most cases they fail to do things in the right way. They usually avoid procedures which have been placed in organizations to achieve goals. Leaders apply irrational decisions to achieve goals. This is explained by the fact that leaders aim at achieving goals by influencing their followers. Therefore, the influence my turn out to be ineffective especially when the followers are not willing to accept change (Lawrence 2010).
In addition, the long-term survival of any organization depends on the adherence to the rules and regulations of an organization. In most cases, leaders deviate from the provisions of the rules so that they can achieve goals in the most reasonable manner. As such, bureaucracies of an organization are disobeyed, and this may cause conflicts with several stakeholders. There has always been a conflict between leaders managers because managers believe in following procedures to achieve goals. These contradictory aspects cause conflicts because leaders try to avoid the procedures put in place by stakeholders (Gill, Mathur, Sharma & Bhutani, 2011).
Despite the few bottlenecks of leadership, it is evident that leadership plays a major role in the performance of an organisation. Organisations have employees working for them. These employees are human beings, complete with emotions and opinions that they will form for just about anything. The opinions formed by employees influence their attitudes towards the work they do, which in turn affects their performance. This means that policies, rules, guidelines, penalties and rewards will not enhance employee performance. This will just make the employees work with fear of losing their jobs and their means of livelihood. Therefore, performance will be what is expected when certain protocols are followed, and work will be a boring routine for them. However, leadership changes all this.
Leaders have within them charisma that appeals to the employees. In essence, this acts as an inspiration for employees to perform better. They influence the way an employee perceives himself and his outlook towards his job. Satisfied employees will perform better than disgruntled ones. Employees who feel that the organisation does not care about them are the one who are likely to sabotage organisational operations by taking part in activities like truancy, absenteeism and absconding duties. Leadership also brings about innovation because it is about change. Any organisation that is not flexible enough to adapt to change remains stagnant or begins deteriorating. The growth status of an organisation says so much about its performance. Leadership encourages employees to become innovative in respect to ways of doing things. This triggers change, which results in continuous growth of the organisation. Therefore, leaders are essential in enhancing the performance of an organisation.