Leadership theory and practice Deloitte in UK
Deloitte is a firm which provides the services to the specific clients in the field of taxation, audit, consulting, risk management, financial advisory. The firm Deloitte is the member of the Deloitte Touche Tohmatsu international abbreviated as DTT, a Swiss Verein. Deloitte is among the world’s most prestigious and largest firm who provides these professional services to businesses. It has employed more than 60000 professionals in its member firms throughout the globe in more than 110 countries of the world. These member firms are independent form the main firm and it is subject to the laws and professional regulations of the specific region or country in which they operate. DTT does not directly provide the services to the clients itself but it helps in coordinating the activities of the member firms. All these member firms of the DTT and DTT itself are separate legal entities form each other which are not responsible of an act of every other firm. Every member firm of DTT is only liable for its own action and obligates only its own errors and omissions. These independent member firms are not following the same structure and are following the different structure according to their specific needs depending upon the factors like national laws and regulations, customary practices and other factors of the territory in which the firm operates. Deloitte LLP is the member firm of DTT in the United Kingdom. Deloitte LLP has employed more than 11000 exceptional professional in UK and Switzerland. Deloitte has aim to known for its trusted professional services and recognized for its expert’s knowledge, skills, caliber and quality of work.
Whenever and wherever there are people involved in some joint task, long-term or short-term, someone is required to lead them. Regardless of the fact that it is forced or comes natural to the ‘leaders’, it seems like the only efficient way to get a job done on this planet. This discussion paper is presented with the intention to relate the theoretical knowledge about leadership and effective management to some organization working effectively.
A layman question should be tacked at the beginning of this review. Why have leaders in the first place in an organization? Can’t employees just do their jobs on their own, while someone overseeing that they do so, without interfering? The answer lies in many justifications. A Leaderless organization would have no desire to follow a particular direction or goal. It would be like a ship sailing in the ocean without anyone steering it. A leaderless organization would have accountability and responsibility related issues. The employee motivation would be at stake and there would be prevalence of non-influential atmosphere (Elsy, P. A., 2009).
Leaders emerge in different forms in any organization; through the legitimate process (formal) in the company, through the ability to influence (informal). Of course the ones formally selected have the power to shape the activities and rewards for the subordinates and are thus more in control. Informal ones on the other hand are perceived as mentors rather than order-givers. They influence the work environment and the attitude of employees. Informal leadership is underrated and rarely appreciated in traditional organizations which prefer a formally laid out organizational structure over ‘casual’ working relation. One of the reasons that employees feel more influenced by the informal leader is that they don’t feel insecure around him/her (Kreitner, R., Crutchfield, S. R., & Ballachey, E. L., 1999). There is no pressure of being the subordinate and behaving in a formal way. Moreover the employees feel at ease knowing that benefits and rewards are not associated with him/her. The ideal scenario for organizational success would be the emergence of a formal leader who has the ability to lead and influence the employees in the direction of achieving the goals set by the management. So, if this scenario fails to emerge, the emergence of informal leadership will become inevitable (Locke, A. E., 1975).
A leader should be well defined in term of authority. This dissolves any ambiguity that may arise when taking a decision or when implementing some change. Moreover a well defined authority package for a leader boosts his confidence in taking tough decision and directing the employees. Without a certain level of authority, the subordinates develop the tendency to ignore the work requirements entrusted upon them by the leader. In simple words, such a ‘powerless’ leader won’t be taken seriously (Maslow, A., 1954).
It’s important that a leader takes his job as a two-way learning experience. Not only should he be a role model for his subordinates, he should be willing to learn and adopt. This way he/she remains updated and would merge in better with his group of subordinates. He should have the ability to challenge the way business is previously done. He should bring about better and constructive changes in the workplace (McClelland, C. D., 1988). The strategies and tactics that he employs shouldn’t deviate from the norms of the organization he is working in. but innovation should always be there on his part to keep the work challenging and motivating for the employees (Luthans, F., 1988).
The theory explains that the main responsibility of the leader is to provide the feasible and favorable environment for the solution of the problem but the solution itself should not be provided because the leader main responsibility is to lead them not to assist them. Leader is the person who inspires its subordinates and guided their effort in the way of the organizational objective. (Mintzberg, H., 1975).
A leader should be able to energize the daily operations and infuse a sense of urgency whenever required. The sub-mission that he outlays for the workers should be inspiring. It’s really important that whatever landmarks he sets should be realistic and achievable. Otherwise employees feel de-motivated and disoriented. He/she should define a certain set of values and norms to his team (Pate, L. E., 1998). He should come across as someone who abides by them himself too. He should be able to aggressively confront the opposition of any sought in this regard.
Another basic requirement of a good leader is his understanding of the importance of team work. Team work is what multiplies the output in real terms if executed professionally. He should devise teams considering the resources allotted and their limitations. The elements of ‘free riders’ should be detected and either removed or confronted. Teams should work as the pillars for ensuring the achievement of prescribed targets.
In the recent times, the concept of sharing the leadership has become quite popular, rightly so. The insecurities and competitiveness of the job market usually take the employees to the edge and they feel threatened. So, in a way, ‘sharing leadership’ is a way to take the edge off. By making employees actively participate in the activities and decision making, their confidence and productivity can be boosted (Thompson, J., 1967). It is rightly said that most organizations fail, not because of apparent reasons but, because the employees are not committed to them. So, the leader’s foremost job should be to devise ways to make the sub-ordinates commit to the goals of the organization; they should feel like being a part of a large family. Employees should feel the responsibility members of the family have to each other and the family name as a whole. They should be looking to survive themselves but parallel to the survival of the company. Leaders aim to moderate such a behavior.
A company’s success largely depends on leadership which leads the company to its ultimate objective. As time passed, people understood the need of leadership for a company and hence they posed many leadership theories. Early leadership theories were largely focused on the qualities that distinguish between leaders and followers while later leadership theories focused on other variables like situational factors and skill levels. The leadership theories that emerged with time can be classified into 8 major categories. Here are discussed two most important of them which are;
Lewin’s leadership styles
Under the participative theory, the most known theory of Lewin is also very widely used in the corporate world now days. Lewin after the experimentation in 1939, proposed the three leadership styles which are widely used in the process of decision making. According to the Lewin the most suitable and effective style is participative leadership. Now coming to the foremost formally acceptable leadership styles (Thompson, J., 1967):
Laissez Faire style of Leadership:
The laissez-faire style is to minimize the leader’s involvement in decision-making, and hence allowing people to make their own decisions, although they may still be responsible for the outcome. It’s the type in which the leader gives ‘free hand’ to the employees regarding their work activities. The employees are expected to be motivated and skillful in doing their jobs, thus, minimal interference from the leader. It is important when adopting this style that the top management has faith in the workforce and its capabilities. The false judgments on leader’s part to employee this style may result in drastic results if the workforce turns out to be incapable (Zucker, L., 1987). Laissez-faire workings best when people are capable and motivated in making their own decisions, and where there is no requirement for a central coordination, for example in sharing resources across a range of different people and groups.
Autocratic style of Leadership:
Autocratic style is very helpful in the situations in which the company does not have enough time to take the input of the employees and it can cost them, if they were late. Autocratic style in the leadership means that there will not be any consultation with anyone in the employees and only top management or leader will take the decision. Lewin has stated after his experiment that this style is the big cause of the dissatisfaction among the employees. This style is more a traditionally enforced one than logically applied. All authority lies with the leader and his/her relation with the employees are purely work-based. The concepts of ‘power’ and ‘order’ are embedded in this style’s foundation. This style can be effectively used in organizations with; chaotic workplace setting, non productive and non serious workforce (Zucker, L., 1987).
Participative style Leadership:
Participative style is also known as the democratic style which says that leader should take the input from every one while making final decision. In this style of leadership, leader has cooperation of its employees and leader always welcome any creative and fruitful input from employees. Participative leadership helps the leader in achieving the satisfaction of the employees.
Briefly explained before, in this style, the leader and the sub-ordinates work more like a team than a hierarchical setting. Sub-ordinates are encouraged to participate in decision making and their ideas are appreciated. This style is more often used in organizations focused on innovation but recently, has become a trend in developed countries. The use of this style under false pretences may result in the management losing control over the workforce (Zucker, L., 1987).
According to the situational theories, the action of the leader can be affected by the different situational factors. Factors that affect situational decisions include motivation and capability of followers. This, in turn, is affected by factors within the particular situation. The relationship between followers and the leader may be another factor that affects leader behavior as much as it does follower behavior.
The leaders’ perception of the follower and the situation will affect what they do rather than the truth of the situation. The leader’s perception of themselves and other factors such as stress and mood will also modify the leaders’ behavior. There are other leadership styles that are employed on ‘situational’ basis. Situational leadership addresses the issues at hand and can employ a mixture of styles previously discussed. There are, however, a few other terms we need familiarity with when talking of situational leadership (Elsy, P. A., 2009).
Strategic style of Leadership:
It is employed in situations when the company faces stiff competition. In such scenarios, leaders need to remain alert to take decisions and bring about changes in minimal time with the least resources consumed. They are flexible and train the workforce to be that way too (Elsy, P. A., 2009).
Cross- Cultural style of Leadership:
Given the aspiration of mostly all firms to go Global, this form of leadership is significant when entering a new market. A different culture poses new challenges and requires different set of strategies to overcome them. The leaders have to resonate with the new atmosphere they are thrust in. Their attitude towards a multi-cultural workforce needs to be customized (Elsy, P. A., 2009).
Team style of Leadership:
In this style, the top management feels that there is no requirement to delegate authority of being a ‘leader’ to any certain personnel. Instead the workforce is divided into teams and the in-charge is made the team leader. This style suits the organizations which focus on team work and consider team work to bring about the most productive results. This style can also be employed in organizations where the workforce is confused about the ‘reporting authority’ (Thompson, J., 1967).
Facilitative style of Leadership:
A facilitative style of leader is focused on getting the best out of his/her workers by providing them the atmosphere for it. Be it; indirect communication, the workplace setting, or the moral support. This type of style is suitable for firms operating in countries with social outbursts or general economic and political letdowns (Thompson, J., 1967).
It is important that when a person is entrusted with leading a certain group, he/she should have the necessary skills to do so. A leader should be equipped with skills to answer the “what if?” scenarios. The skills equipping for the leader comes in various packages to the organization. The person selected to lead might have become capable enough to lead due to; vast experience, rigorous training he/she has gone through, or a combination of both. It is common among the multi-national organizations to expose their ‘leaders’ to the ‘leadership skills’ workshops around the globe. The purpose is to enhance their capabilities and keep them up to date concerning new challenges of handling the workforce (Thompson, J., 1967).
Application to Organization
The organization selected for application of leadership theories and analysis of concepts for this report is Deloitte LLP. The report will be focusing on Deloitte’s operations in UK. Deloitte is a well renowned multi-national firm which provides the services to the specific clients in the field of taxation, audit, consulting, risk management, financial advisory.. It is quite tricky for any organization to operate in UK, given the current political and economical scenario in the country. The workforce of the Deloitte is very diverse and some employees are inexperienced as well.
Deloitte management always gives freedom to its employees to share and communicate their feelings and emotions, ideas with everyone on the basis of equality. Foremost, Deloitte is an equal employment opportunity employer which does not discriminate anyone on the basis of color, sex, religion and the ethnicity etc. Deloitte gives people chance to get the job on the basis of their talent, skills and education. Deloitte always takes input from its employees and honors their valuable ideas.
But it’s not the first time Deloitte has faced the hurdles related to the leadership, they are operating in all the countries and have been able to successfully win over all. The Deloitte management UK is focused on ‘autocratic and Strategic’ style of leadership. The workforce is diverse with colored, mixed and Caucasian presence. Most of the workforce is inexperienced and still in the process of positively responding and conforming to the norms and values of a multi-national corporation. In a way, Deloitte management is right to force an autocratic form of leadership. Though the managers and other leader caliber positions are also infused with locals, thanks to the quota system by the government, the autocratic style of getting the work done is enforced. For a workforce still going through the learning process this style seems to work, at least presently (Luthans, F., 1988). This way, the subordinates know exactly what is required off them and they could be dealt with disappointing outcome in case they are unable to achieve their targets. This strategy of Deloitte has been fruitful as they have been on target in terms of sales till now (Miles, R., & Snow, C., 1978).
The ‘strategic’ leadership style employed has its benefits too. After the apartheid was lifted, companies have been pouring in UK and the competition is stiff among the multi-nationals vying for highest market share. So the leaders (Functional Managers) are tested to the limit. They have to be vigilant enough to respond to opportunities. In turn, the workforce needs to be vigilant too. Thus, the managers in UK division of operations of Deloitte are more frequently; sent to related workshops, the workforce is trained by supervisors in teams, and the workforce is nourished in an aggressive environment internally. The turnovers are high but the management is more focused on getting the best from whoever is on the job on the day. The focus on the fact that teams have a better chance on achieving the targets than individuals is incorporated (Woodward, J., 1965).
The leaders (Managers) at Deloitte in UK are perceived as role models by the workers and that is what has pulled their whole operation together. The focus is on selecting the personnel as leaders with strong technical background and experience. Task oriented personnel are preferred over relationship oriented ones. This could be due to the penetration policy of Deloitte for UK where they perceived that aggressively focusing on profits in the initial years would set the tone for decades to come. The mind frame of the sub-ordinates is too fixed on the task oriented strategy of their leaders. As leaders focus on ‘performance’, the workplace setting gives the impression of an aggressive environment. More than anything, this way, the workforce is getting ready to face the challenges of the modern World (Jensen, M., & Meekling, W., 1976).
Leaders are well defined in terms of authority. There is not much confusion regarding who is to report to whom. This way, line of authority remains clear and obvious to the workforce. Workers know who to follow and in which direction. Conflicts at work, which tend to appear more in a setting like UK, are dealt with strongly. Not that a little conflict is not allowed, just that conflicts are not allowed to reach a stage where they might undermine the productivity. The norms and values established by the leaders are followed strictly and opposition is tackled tactfully.
For a multi-national like Deloitte, only ‘formal’ leaders exist. The idea of an ‘independent’ informal leader is extremely discouraged. In fact, the management in UK makes ‘sure’ that no imposter insults the formal leadership there. The idea is to make sure that subordinates strictly follow their leaders without interference from another individual who can distort the chain of command (Jensen, M., & Meekling, W., 1976).
After analyzing the Deloitte LLP leadership theories which organization has opted for the current prevailing situation in UK, we can easily say Deloitte should continue to adopt this leadership style or changed the theory and style to cope the future needs of the organization.
I will recommend that Deloitte LLP should mould its strategies of operations in UK. In start it might have been the right move to go ahead with an autocratic and strategic leadership. They have established the foundations through aggressive and penetrating way; it’s time for trend shifting. Not just for the sake of change but because it might all fall apart for Deloitte if they continue the way they have in UK. The current strategies of leadership would definitely have caused workforce unrest and untrusting attitude towards the management. The workforce is focused on performance only. This is a prerequisite of lack of commitment to the firm. Remember lack of commitment on worker’s part is what causes the downfall for most of the organizations (Luthans, F., 1988).
A wide range of efforts and steps are being taken up to promote the importance of diverse workplace for achieving substantial potential benefits. Creating a multicultural organization that performs extremely well is possible due to the various innovative measures and strategies.
It is the responsibility of the leaders to keep informing the employees about the goals and direction of the Deloitte. Communicate all the related issues regarding employee future, job and performance. Each and every matter which Deloitte can share to the employee should communicate them. Everything which affects the employees itself also communicated to them especially.
The following measures could be taken to promote workplace diversity:
Effective management must be aware that certain skills and expertise are required for creating a successful, diverse workforce. First, discrimination and its consequences must be understood. Second, their own cultural biases and prejudices must be recognized (Koonce, 2001). Employees should be encouraged to express their feelings, ideas, emotions, and opinions with a sense of equal value to all. This would create a feeling of openness at the workplace where employees feel free all the way.
Diversity should also be promoted and implemented at leadership positions, as it creates the sense of visibility.
Employee’s satisfaction surveys should be introduced at the workplace and results can be used for the implementation of proper and fruitful diversity in the workplace policies. Recognizing differences among groups is not diversity, but rather individual differences.
An individual’s unique identity cannot represent or speak for a particular group. The effective management must be willing to change the organization, if necessary.
The new leadership styles to be adopted in UK and Deloitte should be “Participative, Cross-Cultural and Facilitative”. The management should indulge the workforce in decision making and work with them as a team instead of supervisor. The multi-cultural scenario demands the leaders to understand the cultural differences and respect them. They should be receptive to innovations and new ideas tossed by their sub-ordinates (Maslow, A., 1954). The leaders need to provide an environment that is comfortable and initiate positive indirect communication in the work place setting.
Leaders (managers) of Deloitte should always provide every employee a flexible work schedule pattern for finding an adequate balancing his work responsibilities and social life. Single parent’s family is increasing which makes difficult for the parents to manage the work and family life balance. Women are also the part of the workforce. So, these working women need the flexible working hours for also managing their children’s and house.
Much of this needs to be done because Deloitte has achieved what it wanted through its previous leadership strategies. The workforce has been submissive and obliged because it was a new setup. With passage of time workforce will wear out and retaliate. The coercive management can work for some time but not indefinitely. A relationship oriented leadership will reduce the high turnover and thus reduce the cost of training of new employees pouring in; sharing responsibilities with the workforce will reduce the burden from the shoulders of the leader and make the workforce capable of handling situations in a better way (Luthans, F., 1988).
Regardless of quotas, the leadership (managerial) seats should be allotted to able personnel regardless of race or gender in UK. So if more colored employees qualify for the managerial posts than the quota requires, they should be allotted the jobs without second thought. It would be logical in terms of every business perspective. In fact, the firm might come to realize that the local leaders have more commanding, influential and motivational effect on the work force than their foreign counterparts.
Above all, the current style of leadership at Deloitte gives the impression of feudalism and will eventually result in Deloitte finding itself in the bad books of the government for coercive business practices. It will overall affect the image of Deloitte all over the World. Deloitte is known for its relationship oriented workforce management and its leaders (managers) are known for being the catalysts of healthy workplace environment. Even then, it is understandable that under the circumstances in UK, Deloitte adopted to counter the environment to produce the best possible results in terms of business only. The whole point is that now that they have achieved that and are comfortable in the foundations they have laid; it’s time to change the way to lead the workforce (Mintzberg, H., 1975).
The leaders need to start trusting their sub-ordinates more than they have. The workforce has come a long way from being inexperienced and rigid. The atmosphere is changing for corporate culture. Only such firms will survive which respect the change. The top management can only approve the change in writing or in theory. It’s the leaders (functional managers) who will eventually bring about the change. They are the ones in contact with the workforce. They are the ones considered role models by the workforce. They are the ones responsible for the daily activities and enforcers of the norms and values for the firm. Deloitte’s strings of successes are countless but not enforcing a change might hurt their business prospects in UK badly (Thompson, J., 1967). They have to rely on their leader operating in all the departments and all the cities to enforce a new participative culture in business.
Studies have proved that organizational success is affected by the innovative management styles. These management styles are vary from every organization to another organization. There are different managing styles which all used to manage employees. Management styles can bring success and innovation in the organization but the most important thing is that management style should be suitable for the organization
The concepts of Leaderships are numbered and also their implications and usage are countless. In this report, I discuss the behavioral theories in which three basic style of leadership are Laissez Faire, Participative and Autocratic has been discussed. The current aggressive and competitive environment for business operations requires a situational leadership style. Focusing on one style only and for too long would result in devastation of business. I have discussed the leadership theories and their implications in the Deloitte LLP. Multi-nationals are pouring in and the competition is tough. The discussion applauded the initial strategy of the leaders to use coercive techniques (Maslow, A., 1954). Leaders are considered as role models due to their high level of skills and experience. The managers (leaders) kept an autocratic hold and were focused on strategic leadership. The workplace setting was competitive, aggressive and task oriented. In all, the sales are high and apparently there are no issues (Luthans, F., 1988).
Satisfied and committed employees are asset for the Deloitte. It has seen organization with more satisfied employees perform better than other whose are not satisfied. So, Deloitte’s success or failure also depends on its employee’s satisfaction or dissatisfaction which is hugely dependant on the leader and its leadership style.
Though, Deloitte has the experience and capabilities to overcome any cultural hurdle in UK. The current strategy of strictly keeping a business attitude with the employees will soon be under consideration of the government. The issue of equality and treating humans with respect is already an issue which the government is focusing its policies on. So, Deloitte might end up in the bad books of the govt. Moreover, from pure business perspective, employee motivation is purely monitory. This shows the workforce feels that they are not trusted and are not considered being part of the ‘family’. So the strategies need to be changed before they become the only way out (Katz, R., 1974). The new leadership styles to be adopted are Participative, Cross-Cultural, and Facilitative. It’s because it’s time to start relationship oriented business conduct with the employees. This will reduce the high turnover and the costs associated with it. Only the leaders (functional managers) themselves can bring about the change, the top management can only authorize such a change. Finally, it’s the leaders in an organization capable enough to bring about a positive change and enforce the achievement of targets (Elsy, P. A., 2009).