3

3.0 – LEADERSHIP VS MANAGEMENT THEORIES

Leadership Theories

Before looking into leadership theories, it would be beneficial to understand what term ‘leadership’ means. The term ‘leadership’ is a process taken where an individual within an organisation influences the group of individuals within the company as a collective to help achieve a common goal/achievement. This definition make it clean that leadership is not a characteristic or behaviour of an individual or the position that they hold within the organisation. Rather, the influence they have on others.

For many years now, the study of leadership has developed, with many new theories that investigate what it means to be a leader and how to put your leadership into practise well. Below are three current leadership theories;

Transformation Leadership
• It was James MacGregor Burns that brought this theory in to prominence in the late 1970s. He split the concept of transformation leadership into 2 identifying types. These were as follows;
o Transactional – This type of transformation leadership is defined by how the leader influence the individual or collective group by offering an exchange in the transaction.
o Transformational – This type of transformation leadership is defined by how the leader influenced the individual or collective group by connecting with them in a way that increased the motivational function of the individual or collective group.

Adaptive Leadership
• Adaptive Leadership is the theory when the leader organises individuals or people within a collective group to take on tough challenges/tasks where the solutions to the challenge/task isn’t clear and requires additional thought to be applied.

Strengths-Base Leadership
• Strength-Base Leadership is the theory where a leader within the organisation used their strengths; and the strengths of the individual or people within a collective group to achieve the result they require from their challenge/task.

Other Leadership theories are;
• Leader-Member Exchange Theory
• Servant Leadership.

See Appendix 1 Fig (i) for in-depth means on additional leadership theories
(Obende et al., 2018)

Management Theories

On the other hand, the term ‘management’ is the processes taken within an organisation when an individual within the company takes control of the way a collective operates to achieve a common goal/achievement. The definition outlines that it’s the rules and process that this individual opposes, rather than the individuals personal influence.

There are numerous management theories, below are two current management theories;

Scientific Management Theory
• Frederick Taylor developed this scientific management theory after significant improvements were made in the 20th century to which showed how the potential of science by analysing workflow could be used to improve the productivity and efficiency of the organisation they work for.

Bureaucratic Management Theory
• Bureaucratic Management theory defines how the roles of both employee and management are defined based on a hierarchy system that help to recognises authority. This provide a clear indication as to who is in control and who isn’t.

Other Management theories are;
• Human Relation Theories
• System Theory

See Appendix 1 Fig (ii) for in-depth means on the additional Management theories
(Bizfluent.com, 2018)

4.0 – ANALYSIS OF LEADERSHIP AND MANAGEMENT THEORIES IN THE CASE OF COSTPLAN

When analysing the theories documented in Section 3.0 of this report (Leadership vs Management Theories), we can identify whether Costplan Group Senior Team operate as both/or as Leaders or Managers for the following;

The current structure of the company detailed in Fig (i) of Appendix 4 show both Leadership and Management qualities. Aaron Tomsett as Senior Director to the organisation operate predominately in a Leadership compacity. Where James Mitchell as Director acts mainly in a management compacity, though on some occasion may switch to a leadership role when needed.

Aaron Tomsett shows qualities that are shown in following Leadership theories;
• Transformation Leadership
o Aaron mainly shows Transformational Leadership qualities which were identified by James MacGregor Burns. By influence individual or the group of individuals within the company and motivating them to achieve common goals. Evidence of this can been seen by how the company has grown exponentially since its formation in 2014 and his influence to bring young skilled employees into the company, help with the rapid growth the company has achieved together.
• Adaptive Leadership
o Aaron shows Adaptive Leadership qualities by challenge individual or the group of individuals within the company with complex tasks.
• Strengths-Base Leadership
o When the organisation is under pressure to delivery projects or measures. Aaron takes on the strength base leadership theory, he evaluates individual strength and allocate roles/task to be undertake that the individual is strongest in.

Where James Mitchell shows qualities that are show in both Leadership and Management theories;
• Bureaucratic Management Theory
o James Mitchel main operated within a Bureaucratic Management role as he is responsible for the day to day running of the company and therefore operating in a role where it is highlights his role as being in control such as dealing with disciplinary issues, invoices and finalising fees with potential clients.
• Strengths-Base Leadership
o Like Aaron Tomsett, when the organisation is under pressure. James Mitchell adapted from his main management roles into a leadership role. By taking on the strength base leadership theory, he evaluates individual strength and allocate roles/task to be undertake that the individual is strongest in.

5.0 – PESTEL ANALYSIS OF COSTPLAN

PESTEL is an acronym for a framework that is used to describe the marco-environmental factors that will have a direct impact on an organisation.

From this framework we can identify the threat and weaknesses in the SWOT analysis.

PESTEL is broken into the following categories;
• Political future.
• Economics future.
• Socio-cultural future.
• Technological future.
• Environmental future.
• Legal future.

For the PESTEL analysis for Costplan Group please refer to Fig (i) of Appendix 4.