To What Extent Does Leadership Influence the Market Performance of Companies - Coursework Example

WHАT ЕХTЕNT DОЕS LЕАDЕRSHIР INFLUЕNСЕ THЕ MАRKЕT РЕRFОRMАNСЕ OF СОMРАNIЕS? By (Name) Name of the Class (Course) Professor (Tutor) The Name of the School (University) The City and State where it is located The Date ТО WHАT ЕХTЕNT DОЕS LЕАDЕRSHIР INFLUЕNСЕ THЕ MАRKЕT РЕRFОRMАNСЕ OF СОMРАNIЕS? Introduction In today’s business environment, many things have changed requiring organizations to develop managers with the right leadership skills to push organizations forward and to improve their market performance. One of the major features of the current global business environment is increased competition from various companies that offer similar products and services. Hence, in order for a company to be successful in this kind of market, it needs leadership that has skills in the area of developing corporate strategies aimed at giving an organization competitive advantage over the other rivals. It is not possible for a firm to record a good performance in the market unless it has the right marketing, production and other related strategies. At the center of corporate strategic planning is leadership, therefore, it is hard to ignore company leadership when looking at the market performance the company. Therefore, there is a direct relationship between a company leadership and its performance in the market (Fiedler, 2000, p. 276). Leadership determines the level of growth of the Fast 100 companies, with those recording the highest and lowest growth attributed to the type of leadership approaches embraced by their leaders. This paper seeks to look at the ways in which organizational leadership influences its market performance by focusing on how various leaders within the Fast 100 companies listed in the Business Review Weekly magazine’s 2013, influenced the market performance of their performance by looking the growth their recorded and the nature of leadership within the companies. Leadership Influence on the Market Performance of Companies Leadership is a very vital area in a company, and it plays a key role that influences the company’s performance in the market. The skills, values and traits that are acquired by those in the leadership positions in any company will be a very essential factor in the performance of that given company (Fiedler ,2000, p.194). For instance, the traits of AussieCommerce Group chief executives played an important role in ensuring that the company recorded the highest growth in the Australian market in 2013. The company leadership embraces the value of ethical leadership, thus, ensuring that their employees conduct themselves in an ethical manner. Additionally, being the chief executive, they are are the major decision-making unit in the organization with regard to the manner in which the organization is to be run and the market practices that are to be embraced in the marketing of its products. Hence, since the company started in 2010, Adam Schwab and Jeremy Same have embraced the culture where corporate values of creativity (Hurley 2013). Different companies have embraced different types of leadership that have different impacts on the market performance. In the democratic type of leadership, leaders are able to give the other employees and other people in the leadership positions a chance to make a decision on their own (Wright, 2012, p. 35). This type of leadership also enables the leaders to have feedbacks and other information that is crucial towards the performance of the company in the market. For example, the leaders of Planet Innovation Pty Ltd (Struart Elliott), embraces the democractic leadership, thus allowing employees to implement their creative as well as innovative ideas, some which has enabled their companies to record the highest growth (Thomson 2013). In this case, leadership affects the general performance of the company depending on the type of leadership that different leaders choose to put in place in their time of governance for the company. A company’s leadership style may result in poor performance in the market as it may have different impacts on the relationship between the employees and those in the areas of management. Dictatorial leadership will result in employees being unmotivated, thus, producing products that do not meet the quality required. The volume of output in the company is also likely to reduce thus failing to meet the market demand for their customers. This, therefore, results in poor performance of the company. Leadership is the most crucial position in the company, determines the success that the company will get in the market. This is mainly dependent on the kind of marketing policies that the company will implement and the effects that are likely to erupt from the policies. Leadership in the marketing department of the company should work hand in hand with the company’s general management in order to ensure that they have attained the goals and objectives that the company has set. They are given the role of coming up with the marketing strategies that are to be used in order to boost the market for the company. During exploration of new markets, leadership plays a key role in determining of the markets and the people that are to be assigned the roles and the objectives, goals and missions to be achieved throughout the process. This has been a key area in the performance of the company in the market. For example, Mad Mex Fresh Mexican Grill has recorded higher growth rate for the last three years, because they of the ability of its leader for developing marketing strategies that suits the needs its, thereby enabling it to generate higher revenues that any firm in the list for the last three years. The company operates in highly competitive markets, but the abilities of its leader to develop marketing strategies have enabled it to perform well in the market. Leadership is the major unit that creates the visions and the goals of the company. This therefore gives the other employees the determination of the next step that they should take by knowing the things that they should do. This will also be inclusive of the next products that they should come up with and the features that are to be contained in the products, looking for markets in which the new products are to be sold as well as adopting new technology in their production process. Leadership also determines the way through which the visions are to be achieved by developing the strategies and initiating them (Hughes and Beatty. 2005, p. 56). The skills and strategies give a demonstration of the knowledge that the leader has on their job. This will include restructuring of the organization, management of the products that are being produced by the company and strategic management. Good leadership gives a way through which people can be in a position to accomplish the strategies thus the company’s goals. Leadership provides inspiration and motivation and puts up strong relationships among the different structures in the company. This ensures that all those working in the organization carry out their roles in harmony, thus the proper market performance of the company (Fubini, 2007, p. 103). Intelligent use of power and leadership positions in the company is a major way of enhancing proper performance of the company in the market as the leaders are in a position to link up with the customers thus getting informed on their views. The major skill that bridges all the functions of leadership is decision-making. Leadership that is effective is dependent on the choice of the three alternatives. For instance, the performance of Web Marketing Expert, after carrying out an analysis on their leadership largely depends on their leaders to formulate visions and values that motivate employees to work hard towards attainment of the organizational goals. The company leadership has put in place values that encourage growth and facilitates retention of customers. Leadership, being the major representative of the company, gives the leaders the role to attend the market shows, conferences and exhibitions in order to learn about the way that they can be able to improve their product sales and quality (Iyengar, 2008, p. 87). Therefore, this makes leadership a tool through which the company can uplift its production capacity, as well as improving on the quality of their services to their customers. Due to these factors, the market ability of the company is dependent on the efforts that the leaders put towards improvement of quality, acquiring of new methods of production that are effective, and implementing the methods of production that aid them to improve the market ability of the company. For instance, the names of the leader of Plus Fitness have determined the level of growth that the organization has achieved, because he is very popular professional in the field of management. The Nigel Miller, leader of the organization takes fitness training as a means of encouraging people to visit the company premises for fitness related services (Stafford 2013). The ability of the leader to market the company in shows is high compared to those companies with leaders with less influence in the society. Leadership commitment is another area that dictates the success that a company is likely to achieve in the market. A company with leadership that is committed performs very well in the market as the leaders perform their duties based on the objectives and the goals they have set to achieve. Leaders that are committed are also in the ability to interact with other leaders in other companies in order to learn new ways that are embraced by their companies (Morgan, 2002, p. 88). They also interact with suppliers, customers and other outlets for their products in order to gather information about the needs that their customers may have and the changes that customers advocate on their products (Fubini & Price, 2007, p. 156). This offers the company a way forwards towards improvement of the products and their services. For instance, Aussie Commerce Group leaders are highly committed to the success of their organization, given they are the main founders of their respective companies. Hence, the high market performance recorded by the two companies in terms growth and revenues. Leadership represents the image of the company in the market and therefore could cause a great influence to the performance of the company in the market. Leadership is the one that set the goals that other employees in the company should work to achieve and sets the pace for them depending on the commitment and support they offer. Leadership is also responsible for making the changes; hence, must be careful when exercising their insight to determine the changes that are of benefit to the company in the market and the ones that are (Sosik and Jung 2010, p. 89). The company’s leadership should also create self awareness among those in the leadership positions and the employees. This is in order for them to have a clear guideline on the goals, mission, vision and the objectives that the company has. Leadership should also look keenly at the strengths and weaknesses of the company before they tackle the challenges (Fiedler, 2000, p.104). This gives them the right approach to the challenge without causing negative effects to the company. In order to enhance good performance in the market, the company leadership should work hard to create a strong team work among all departments. This ensures that the results are of high quality and meets the needs of their customers in the market. As a result, this will boost the market performance of the company. Therefore, leadership is an essential factor in the determination of the company’s performance in the market. Additionally, another important area that an organization leadership plays a critical role when it comes to mergers and acquisition decisions. Mergers and acquisitions are business strategies used by many companies, in the modern business environment, to increase their competitiveness, and at the same time, reduce competition. Merger occurs when an organization agrees with another organization to come together and do business as one organization. The strategy has been applied by various company leaderships when entering into global markets and expanding their markets. When a company is not in a better financial and market position to compete with already existing big firms in the market, its leadership is always forced to make important company structure decisions. This is regarding whether the company should merge with other smaller companies in the same market in order to create a big firm with vast human and financial resources. Hence, the decision to merge or not to merge with other firms solely depend on the an organization leadership. A leader with the right strategic planning skills will have the capacity needed to determine when mergers can be used to improve the market performance of a company and when it is not an appropriate strategy (Fubini & Price, 2007, p. 194). Thus, good leadership within an organization can play a critical role in reducing competition and improving performance of a firm by making the right mergers decisions. It is hard to avoid using the merger strategy in the current global business environment, which is dominated by big firms that have huge financial and human capital resources at their disposal. Therefore, in order for any small company to compete with these big firms, its leadership has to make strategic decisions of merging with other smaller companies in the same industry (Fubini & Price 2007, p.183). The merging process will enable the small firms to pool resources together with an objective of improving their market influence, hence, boosting their market performance. It is impossible for a company to make a merging decision in order to increase competitive edge unless it has the right leadership in place. For example, leaders of ERM Power Limited have employed the merger strategy, hence improving the market performance of their companies, for instance, recently the company has taken control of Oekay Power Station (Jans 2012). The company has merged with other companies for the last three years, increasing its market share. On the other hand, acquisition strategy is widely applied by big companies, which seek to increase their market share and reduce competition from small firms. The leadership of a company has to make the decisions on what best for the company. This is by looking at the existing market conditions and determining whether the company can be best placed when it acquire other small firms (Spillane 2006, p. 32). The nature of leadership within an organization determines the nature of acquisition decisions that are made by the management. Lack of the right leadership within a company with leadership skills in the area of business strategy management means that, a company will make wrong acquisitions decisions that will result in it performing poorly in the market (Fubini & Price, 2007, p.167). Those companies that have used acquisition as a strategy of improving their competitive edge have been able to do so because of having the right leadership in place. Leadership is usually at the center of acquisition decisions. For example, the leadership Mad Mex Fresh Mexican Grill has been responsible for deciding whether the company will be healthy, financially when it implement the acquisition decisions (Gardner 2012). As a result, they have been able to acquire various businesses with an aim of increasing their presence in the market. Consequently, leadership has to determine the benefits, as well as gains that the company will make from implementing the strategy as part of its program to enhance market performance through increasing its market share (Iyengar, 2008, p. 146). Conclusion According to this research, there are many ways in which leadership influences market performance of any given firm. One of the ways in which leadership of an organization influences market performance through its commitment to the implementation of various strategies aimed at increasing sales and other areas of the company. The leadership should be in support of strategies being implemented, failure to which, the strategies will automatically fail. This is because the resources needed for them to function properly will not be provided by the company leadership. The motivation of employees within a company largely depends on the nature of leadership within a company. There is evidence that a close relationship exists between levels of motivation and employee productivity within a firm, for example, in the case of Mad Mex Fresh Mexican Grill. The market performance of any firm depends on the commitment of employees to produce quality product and increase their productivity. This is with an aim of giving an organization competitive advantage over main competitors in the market. Thus, the leadership of an organization influences market performance of an organization by ensuring that employee productivity is improved by motivating them (Goleman, Boyatzis, and McKee 2001, p. 46). Additionally, the leadership influences the market performance of organizations in the area of sales and revenues by employing the right marketing and corporate image building strategies. The image of a company is correlated to its market performance. In today’s business environment, a firm has to use corporate social responsibility approach to bring out an image of itself as a business that is concerned about sustainability. Therefore, the leadership influences market performance of companies by the ways it is able to build a corporate image that will influence potential customers to buy the products, as well as the services of the firm. On the other hand, leadership determines the market performance of companies by the ways it develops mission, values and visions of the respective companies (Dubrin 2007, p. 40). The ability of leadership to apply acquisition and merger strategies in the right context also influences a firm’s long term performance in the market. Therefore, the leaderships of companies, to a greater extent, determine, the market performance of their individual companies. For example, how the leaders of ERM Power Limited and Mad Mex Fresh Mexican Grill used the two strategies in influencing the market performance of their respective companies. In conclusion, the best companies which have recorded higher growth and revenues in the list of 100 fast companies, have achieved this due to the major role that leaders have played in influencing the way their organizations do things resulting in high growth. References Dubrin, A.J. 2007. Leadership: Research Findings, Practice, and Skills, 5th ed. Boston: Houghton Mifflin. Fiedler, F. E., 2000. Leadership experience and leadership performance, Alexandria, Va: standards, portfolio assessment, and the internship, Lanham, MD.: Scarecrow. Fubini, D, & Price, C., 2007. Mergers: leadership, performance and corporate health, Goleman, D., R. Boyatzis, and A. 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