Developing appropriate leadership styles
Curriculum Topics • Management and leadership • Leadership styles • Leadership styles in action • Factors influencing leadership style
Tesco is a customer-orientated business. It aims to offer products that provide value for money for its customers and to deliver highquality service. Tesco wants to attract new customers, but it also wants to keep its existing customers happy. Building customer loyalty is a cost-effective strategy to grow the business. This is because satisfied customers are a good advert for the business. Tesco has more than a 30% market share of the UK grocery market, nearly double that of its nearest rival. In its 2009/2010 financial year, Tesco earned revenues of £38.6 billion in the UK and employed more than 280,000 people. To keep at the top of its game and to maintain its number one spot in the market, the company needs skilled staff at all levels and in all roles. Roles in Tesco range from business development, supply chain management and marketing to finance, store operations and personnel management. Each area of expertise requires leadership and management skills. Tesco aims to develop the leadership qualities of its people throughout the organisation, from administrators and customer assistants to the board of directors. It adopts a similar approach to leadership development for staff at all levels. This is in line with Tesco’s employment philosophy: ‘We believe in treating each other with respect, with everyone having an equal opportunity to get on, ensuring Tesco is a great place to work.’
This case study will show how Tesco’s leadership framework is fundamental to developing the qualities of leadership needed at every level in the business.
Management and leadership
There is a difference between management and leadership. Management is about getting things done. Managers organise human and physical resources to achieve business aims and objectives. Leadership is about influencing, motivating and inspiring people. It is about coaching and developing people, treating them with respect but challenging them. Leaders seek to create strong teams, with people committed to the organisation’s overall goals.
The function of management (Henri Fayol)
customer-orientated: An approach that starts with customers’ needs and wants and which then drives every business process.
Market share: The percentage of sales within a market that is held by one brand or company.
Tesco | Developing appropriate leadership styles
Tesco looks for managers who are positive, confident and genuine, with the capacity to inspire and encourage their teams. A key part of Tesco’s programme for building leaders is encouraging self-review and reflection. This allows staff to assess their strengths and find ways of demonstrating the characteristics that are vital to the long-term development of the business.
The business writers Tannenbaum and Schmidt categorised different leadership styles. They suggested that leadership styles could be explained on a scale ranging from ‘autocratic’ through ‘democratic’ to ‘laissez-faire’. The process of managing starts with the target or objective to be achieved. A manager must decide on the appropriate approach for reaching that target. The manager then needs to communicate this approach clearly to his or her team and to allocate tasks to each team member. Task allocation and delegation of responsibility is part of the management function. However, other factors will also have an influence on whether the target is achieved, including the task in hand, the skills of the team and the style of leadership. The style of leadership can vary depending on the task. Some managers allow teams to take charge of their own decision-making for many tasks....