Organisation structure is an essential part of business that ensure hierarchical department that perform their tasks in order to accomplish the overall goal of business. It is composed of small units that are employees and departments. The hierarchical structure brings together resources and individuals for producing efficient services and earn profits to enhance reputation in corporate world. For present study IHG has been chosen. The purpose of this report is to examine human behaviour in workplace of IHG through management and leadership theories. It also aims to provide understanding regarding organisational politics and power which are a
A) Organisation's Effectiveness
Management and Leadership
A leader can create influences on individual and support them to work for the objectives defined for the group. An Effective leader is one who influences and directs people regarding their work so that their purpose of serving organisation positively is complete. On the other hand, management refers to an ability of getting things done through individuals in formally organized group. Management is a goal oriented process. It has power and responsibility to make decisions and provide instructions for accomplishing goals and targets. Both leadership and management can be attributes of one single individual working for an institution (Effective Quality Management in the Hotel Industry, 2017).
Different theories to management
Management is organising all activities and business functions in a systematic manner so that no two functions are overlapped. This improves quality and efficiency of business. Different types of theories and concepts are applicable for management which can be adopted by IHG (International Hotel Group) to deliver best in class services.
These theories are described below:
- Contingency theory: This theory is applicable in situations where decisions are made quickly. The major applications of this theory is during crisis situations, when fast decisions are required. Generally autocratic leaders have this approach of management. They do not require major support from co-workers to formulate decisions (Wood and et. al., 2010).
- Systems theory: Every organisation is divided into certain individual systems that cooperatively function. Managers with system thinking approach manage all these different systems. They are capable of identifying effects and factors that components working in a system can have on IHG.
- Chaos theory: Often certain instances occur in an organisation when organised functioning is not possible. This happens in case of uncontrollable situations. Complete strategy fails and confusion is scattered amongst workers. Hence, management has to take charge by applying chaos theory (Huczynski and Buchanan, 2010). This helps in admonishing situations effectively. Chaos theory helps in managing changes and complex bearings which provides stability to organisation.
Different theories to leadership
Leaders are drivers of a group. This group can be a business, team or even a country. There are certain leadership theories that help in increasing effectiveness of IHG.
There are mentioned below:
- Transactional leadership theories: Based on exchange of ideas and thoughts this theory is mostly cultivated from transactional leaders. In this approach people transact or exchange attributes for better strategic development (Schoenly, 2012). Positive atmosphere is maintained in this theoretical approach. Moreover, IHG can have innovation generated strategies which will help the firm acquire competitive advantage.
- Transformational leadership theories: A manager or leader is said to have a transformational approach when he/she thinks of overall development. No individual benefits are perceived. Decisions are democratically taken (Gold, Thorpe and Mumford, 2012). This leadership style also encourages positive atmosphere within the organisation with more efficiency. With high levels of motivation and charisma in their behaviour, transformational leaders are quite flexible and humane. This quality makes them more eligible for organisational dynamics.
- Contingency theories: Every leadership theory is based on single path of functioning. But this principle is based on alternative paths which can be adopted according to need of hour (Effective Quality Management in the Hotel Industry,2017). IHG functions with real time customer interaction. Deliberate positions in which negative comments are received from customers are dealt through contingency theory for leadership (Watson, 2013). Here, leader acts as per the requirement and level of efforts needed in particular situation. It is based on portrayal of different traits which also means situational leadership.
Application of management and leadership to organisation's effectiveness
Organisation effectiveness is a parameter that is used for judging market position. It also helps in understanding the peculiarities of meeting objectives and goals during a business cycle. IHG has to maintain its brand name and reputation. Efficiency for achieving the purpose of business functioning can be increased by applying management and leadership principles (Muijs, 2011). As mentioned above there are certain theoretical approaches that can be adopted by respective authorities.
Factors that help in contributing to organisation effectiveness are stated ahead:
- When activities are organised and managed with setting up of targets then authorities feel confident. IHG can face it as a motivational factor. Leadership enhances performance of staff. Dominantly transformational leaders think about their staff before themselves (Robbins and Judge, 2012). With their great oration skills and inspirational talks, stronger bonding is created within the institution. Managers are visualised as representatives of Hotels. Hence, their skills for handling staff and clients must be near perfect. Subordinates perceive IHG through manager. If no management approaches and leadership qualities are engaged by him then, staff members will feel discouraged and less confident to execute any instruction.
- Effectiveness is increased when commitment is guaranteed. Management and leadership go hand in hand (Hartley, 2010). A leader has to be a manger and manger has to portray some leadership skills. The purpose behind these two models of business is organising human resource in such a manner that mission and objectives are fulfilled timely. This can only be possible through commitment. It creates a sense of responsibility which increases productivity.
- Great management and leadership skills definitely help in growth of IHG. For a business like hotels and resorts to be successful growth is essential. IHG could not have acquired current market status if opportunities were not explored. From business expansion in other countries to internal development of organisation, the company has earned its brand recognition globally.
- Assignment of individual duties helps in making employees more involved with IHG. This can only be possible if an authority monitors their activities. Management and leadership helps in evaluation and screening of internal activities of IHG. Managers are accountable for ground staff. Their seniors are accountable for managerial functions and the hierarchy goes on. This creates progress and easy execution of actions. Major advantage with this organisation system is that people liable for mistakes can be easily identified due to transparency and effective management (Pinder, 2014).
Power and Politics
Power in organisation: Power is a sense of authority with responsibility. It allows a person to instruct and take care of particular activities that are under his territory. In business organisations these powerful personalities are leaders, managers, senior managers, chief executive officers, etc. (Goetsch and Davis, 2014). The level or intensity of ruling can be different and depends upon position of individual. IHG manages to distribute power amongst its senior level managers so that effective functioning is guaranteed. It is a human trait that is utilised for managing different business operations.
The aspects and understanding or power differs for every employee working in IHG. A ground level staff has the power to perform his tasks but is guided by his manager. While manager has authorisation of looking after complete set of functions on ground level.
There can be some sources of power in IHG:
- Legitimate: This source gives potential inputs to people in a particular position. For example, managers have legitimate power to assign duties their subordinates.
- Expert: The people who have expertise and skills with deep knowledge and understanding regarding a particular function are given expert power.
- Referent: Interpersonal relations often transfer power from one individual to another on personal basis. This is referent source of power.
- Coercive: When unfair means or threats and sanctions are involved for influencing people then coercive power is generated.
- Reward: Employees who can generate abilities in other individuals to avail incentives is reward power. This creates a competitive environment in IHG.
Politics in organisation
Organisational politics is a term often not perceived in a positive way. Whenever, politics is involved, misuse of power is significant (Ferris, 2012). But politics can play an optimistic role in long run when benefits of company are considered. When a network is designed internally for communicating and achieving personal or organisational benefits then, the process is termed as politics. If used for a positive purpose then, business politics can be less manipulative and more profit oriented (Thiel and et. al., 2012). IHG has to screen its internal activities so that organisational politics do not ruin its long term goals or objectives.
At times in external environment of businesses; rivals and businesses initiate politics so that they can curb competition and manage to acquire better customer share. This is not ethical and legitimate. Self interests and unethical practises are roots of negative politics.
Application of power and politics to organisation's effectiveness
Perseverance for success is through acquisition of power. IHG is a powerful company in international markets due to its successful business composition. Anticipation of positive power will enhance efficiency and productivity while negative power will ruin all favourable circumstances. Henceforth, it is essential that power is controlled and managed for adding to effectiveness of company. Politics is intentional enhancement of self interests. Ethical organisations do not motivate politics but authenticity can be imbibed in politics (Goetsch and Davis, 2014). IHG' s working efficiency will decrease if politics and power are negatively handled. Ambience is spoiled and people cannot concentrate on objectives or purpose of the company. They will apply their energy in overcoming barriers that are produced due to negative politics and overpowering instructors.
Politics creates a connection of illegal or unfair practises inside IHG. Factors like allocation of responsibilities, performance standards, rewards and incentive distribution, employee expectations, etc. when controlled help in producing positive politics. Workplace must be free of grudges, hard feelings, negativity and oppressions. This will not only boost the confidence of employees and improve retention (Lux, Crook and Woehr, 2011). Negative factors will give birth to negative politics and this will limit progress of IHG. The reason behind people indulging in such activities is weak leadership and monitoring. Equality amongst employees is a must to curb politics. Discrimination on the basis of gender, religion or personal preference must never be entertained in IHG or any other enterprise.
Person at a powerful position always faces criticism. Despite of his selfless efforts there are certain elements that would work for ruining the reputation and success path of authority in power. IHG' s effectiveness will be increased if leadership is excellent. Managers are considered as representatives of the company. Hence, their power to instruct and manage all operations is controlled by giving responsibilities. With proper distribution of opportunities and timely rewards generate better productivity. Respect towards authorities increases due to such selfless decisions (The Impact of Power and Politics in Organizational Productivity, 2017). Concerns regarding strategies and decisions taken of benefit of IHG can be expressed clearly, that too without any hesitation.
Impact On Culture Of Ihg
Impact of management and leadership on the culture of organization
IHG is one of the largest multinational organisations that functions in various countries and with various subsidiaries. To mange this large chain of services specific skills and efficient leadership is required. Both leadership and management go hand in hand. Deficiency of any one element can lead to crucial consequences. Organisational culture is something that is made up of beliefs and values that are set in internal environment. Ethical practises, employee relations and productivity levels are major part of organisational culture.
Culture in IHG is formed by actions and behaviours of its staff with efforts and contributions from the leader or manager. To create a good culture and working atmosphere it is the duty of leaders to adequately perform their roles (Higgs and Dulewicz, 2016). Managers in hotels play a vital role. They are responsible for all ground operations that are executed in Hotels. They are answerable to senior managers or leader like authorities.
Following impact is often felt by IHG due to management and leadership.
- Culture is build by leaders and managers. In IHG, leaders could be a hypothetical image residing inside a manager. If a manager is dictating all activities but doesn't cooperate with his sub ordinates then a negativity will be formulated in minds of employees. They won't be able to express their views and ideas that could be beneficial for betterment of the company (Bello, 2012).
- Performance gets affected. It is not possible for a new comer who has recently joined IHG to achieve targets set for a person working since a long time. This management skills has to be perfect for manager and leader. Allotment of tasks and analysis of performance must be done on a legitimate barometer.
- Leadership affects the morale and input capacity of an employee. Unlike transformational leaders, autocratic leaders do not receive positive feedback or reception. This is due to dictatorship nature of the leader. Every staff member requires certain cooperation and moral support from his mentor or senior authority (Schein, 2010). If this flexibility is not received then peer pressure increases and employees are not able to portray 100% of their hard work. Management and leadership must be engrossed in IHG in such a manner that staff doesn't feel deserted or burdened. They must be motivated and rewarded according to their actions.
- Often employee relations affect productivity graphs and effective functioning of organisation. Since, culture consists of employee relations and their nature it is handled correctly through management and leadership. The essence of these two terms must be felt and not just implemented (Moran, Abramson and Moran, 2014). IHG for smooth functioning imbibes an organised culture through democratic leadership and great communication mediums. This helps in producing positive employee relations without biasses towards particular individuals.
- Communication enhances work culture in IHG. Customer needs and demands are changing constantly. For meeting these expectations, there must be harmony inside the organisation. Effective communication helps in building this harmonic culture. Leaders and mangers take care of communication mediums and techniques so that no employee is oppressed due to distortions in information (Vaccaro and et. al., 2012).
Impact of power and politics on culture of organisation
IHG' s workplace culture consists of diversity amongst people. Because the company resides in culturally diverse regions, it is important to develop a positive working atmosphere (Ferris, 2012). Politics is something that always disturbs smooth working of businesses.
The impact that is felt on culture of IHG due to power and politics are:
- Power is an extensional function of leadership. When a person acquires some position at which he/she is enabled to instruct or order subordinates then it is legitimate power (Lux, Crook and Woehr, 2011). Leader has to manage his attitudes when power is given in his hands. Interactions with employees and working for their betterment by utilising given authority is positive power and it definitely enhances work culture. Labourers do not feel exploited because their services are being used in ethical manner (Zaleznik, 2017). Moreover, when they are paid with rewards and recognition, leaders gain respect and dignity in eyes of workers. This is a positive aspect of power.
- On the contrary, this power is misused when politics gets mixed up. It is a normal human tendency to think about personal interests first and then concentrate on overall development. But politics is totally different concept. It demolishes the substantial meaning of corporate governance. IHG will start depleting from its roots if politics is imbibed with power. No wrong practise can survive without power. Often cultural ethics are disturbed to satisfy greed for immense power (Schein, 2010). This spoils the spirit for working in an organisation. Furthermore, productivity of employees decreases because they feel deprived of rights and opportunities.
- While IHG is focusing on further business expansion, there is developing need to control power and end politics. As stated before, culture is made up of values and beliefs of employees with IHG. This indicates that to maintain positive atmosphere it is essential that rotational policies and promotion strategies must be inculcated.
- Cultural politics are like computer virus. They erode authenticity of an organisation. Deliverance of wrong information and increased stress levels amongst employees are the end results of this kind of situation (Metcalfe and Rees, 2010). Rightful use of power will not only eradicate such processes but also maintain trust and faith of workers in the company.
- Commitment and responsibilities are established when power utilisation is done in correct manner (Gold, Thorpe and Mumford, 2012). Individuals may perform better if person in position is justified and guarantees democratic and transformational governance in IHG.
- An important role is demonstrated by power and politics in business environment. The reason behind such great importance in work culture is decision making process. IHG has a hierarchical organisation structure\. Hence, decisions cannot be taken by operational level employee. Workers have to rely on authorities or managers for this process. The impact of every decision is felt by both internal and external stakeholders. Politics influenced powerful decisions will be partial and biased.
Organisational behaviour is just not limited to attitudes of employees. It also refers to major functional aspects that is management and leadership with power and politics. This assessment helps in gaining knowledge about ways in which these four elements influence organisation effectiveness of IHG. It was also realised that choice and implementation of proper theories and strategies decided the output on culture of the company. This power resides in hands of leaders or managers. In final section of this report, the impact or influence management and leadership can have on IHG' s working culture is portrayed with effects of power and politics on the same. Hence, to maintain better organisation behaviour in the company, IHG must inculcate effective leadership with negligible negative politics.
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