Critical Analysis Of Transformational Change Essay

Question:

Discuss about the Critical Analysis Of Leadership and Transformational Change.

Answer:

Introduction

The CEOs are very important in determining the progress of the company. This means that they ought to have diverse and intense skills of leadership since they deal with employees and clients of different backgrounds. However, the CEO position is quite challenging, and this necessitates a series of dismissals which cost a company billions of dollars if a CEO is not effective. It is also discouraging for the directors who put more efforts in scrutinizing candidates to anoint the appropriate CEOs in their companies. Therefore, the position requires one to be focused on achieving a lot of success and maximizing profits. The big companies in Australia for example, have been able to attain the topmost position in the country and the world at large because of the good leadership got from their leading CEOs. This paper features the CEOs of Wesfarmers, Amcor Limited and Billiton Group namely; Richard Goyder, Ken Mackenzie and Andrew Mackenzie respectively, as some of the largest companies in Australia and their leadership styles and how they have impacted on the progress of the company.

Aim

This report aims to analyze the leadership of three Chief Executive Officers (CEOs) of Australian companies to assess their leadership theories and how leader performance can be improved to enhance organizational performance.

  1. This report will compare and contrast the leadership approaches of three Australian CEOs and identify how each leader's approach has influenced the organizational output and analyze the challenge faced by one of the CEOs. An effective leader should understand the organization and its structure to identify the opportunities available for exploitation and initiate proper directions and inspiration. This requires a leader to have a professional background which includes education and work experience.

Selecting And Assessing The Ceos

  1. The CEOs. The three CEOs selected for this analysis include:
  1. Richard Goyder – Wesfarmers – Australia, 1993 having worked in several commercial roles. He was the General Manager for three years before being elected as the Managing Director in 1999. He became the firm’s Chief Financial Officer in 2004 and assumed the position of Chief Executive Officer in June 2005. He was a leader who believed that the future of the company should be far much better than the current state and directed his efforts in making things work more easily.
  2. Ken Mackenzie - Amcor Limited - 2002 as the Deputy Managing Director. In 2005, he assumed the CEO’s position whereby he was keen to ensure that every occurrence would not just happen and disappear but rather he would learn great lessons to help him advance his ways of handling situations in future.
  3. Andrew Mackenzie - Billiton Group - 1983 as vice president. In 2003, he joined Rio Tinto as the Financial Manager of the industrial minerals division until in 2007 when he became the CEO succeeding Marius Kloppers. He had expert communication skills that enabled him to appear mostly in the news media, and this helped him advertise his company to a great extent making his clients attain more confidence in the company and the products.

Ways Each Leader Conceptualizes Success through Their Leadership

Wesfarmers is one of the biggest companies whose CEO is Richard Goyder and whose leadership landed the company many miles ahead than anyone would ever imagine. Under his leadership, the company was transmuted into a diverse organization from a relatively small farmers’ co-operative standing in the top 50 companies in Australia in a span of 10 years. The company had a market share of around $26 million when Richard took over the leadership mantle in 2003. The company rose up to past one billion dollar market share before he stepped down making it among the largest private companies employing more than 300,000 people. This was a significant move in the company under his leadership which made him become a great and prominent CEO whose legacy would be remembered and felt for generations to come. His financial goals were far much ahead of his years, and his business mentality was quite excellent.

Ken Mackenzie as the CEO of Amcor Limited from 2005 has extensive experience both in the executive and global leadership due to his deeply strategic approach. This company is a packaging company has operations in over 40 countries. The 23 years of career in the packaging company gave him extensive experience regarding all the business segments of the Amcor in all the emerging and developed markets in Asia, Europe, America, and Australia. He has initiated packaging sustainability and led the board in informing the entire market about the sustainability of packaging. This has been done through various means including participation in the industry forums like the Sustainable Packaging Coalition. Working with the suppliers and customers also ensures that the packaging sustainability has been considered from design to end-of-life. Through his leadership skills, he has ensured the safety of the workplace which forms one of the greatest concerns for the employees. The CEO gears towards achieving a workplace of zero injuries. Occasionally, some incidents of serious injuries may be experienced in the workplace which makes the CEO to take the initiative to learn from the incident and initiate proper measures to ensure that a similar case ceases to occur.

Andrew Mackenzie has been the CEO of the Billiton Group for the last five years which made him become an expertise in the complex corporate and risk management, advisory work and solving disputes. He was involved in the trusted advisor with the clients from Australia globally. He possesses industry knowledge and technical excellence. This has enabled him to work closely with customers on some complex and significant criminal investigations and civil disputes in Australia mostly in resources and energy, telecommunications and financial sectors.

Based on the previous pattern of leadership and approaches, Andrew is able to classify situations and compare them with different ways of approaches so as to determine the best approach to a business situation. His listening skills are quite excellent, and he gives a chance to his followers to speak their feelings, complains and submits reports. He expresses attentiveness or expressing excitement when listening to a follower. Andrew observes how the boards work differently as a result of the historical context of their implementation and achievement is very high. He said that as a leader, he always has the answers at hand to the questions he asks the board and the employees but asking them is a way to ensure that they know and do what is expected of them.

How These Leaders Describe Their Conceptualization of Leadership

As the CEO of Wesfarmers, Goyder watched over the agriculturally focused cooperative's transmutation to retail, excavating multinational which makes the Australia's biggest private sector workforce to boast. During his leadership, he has made the nation afford a big turnover by fighting against political self-interest groups and safely navigating the troubled waters of WA Inc. He also appreciates the role of the talented people in the company as useful ingredients alongside the suggested systems. One secret he holds is a generational alteration of employees whereby the younger and more trained employees are recruited to join the older employees or the retired ones or even the incompetent employees to ensure a continuous and a sure business success. His leadership skills make him foresee the potential in the farmers' co-operative of becoming an exceedingly powerful group as well as having numerous diversified streams of business. The investment potential in the Wesfarmers collection motivated him as a business person and also identified a means to improve the morale of the staff.

The report delivered on 2013 for Amcor Limited's Annual General Meeting indicated that the company had achieved a 15% reduction in the emission of GHG and a 10% reduction in water usage under Ken's leadership. This meant that the CEO was determined to secure an environment-friendly working place which also promoted the health of the employees and the public in general. His leadership skills were geared to engaging with the shareholders, and other individuals in a quest get to know their perspective in a better way and to create long-term value for them. A report said that his leadership had been worthwhile which contributed extraordinarily to create a further development opportunity to the company.

Andrew uses the profit-arithmetic approach (PA) whereby he operates on the basis of processing information and data through a mental process so as to be able to differentiate between the profit levels and those that are not. This approach which relies mostly on the mind of the individual makes the CEOs to base their decision-making processes on the possibility of making profits rather than the image of the company. This means that he relies mostly on his knowledge of the company's strengths, weaknesses, resources and the company in general to make informed decisions and would sometimes depend on his sense of business especially when the level of uncertainty is quite high. Andrew believes that a "sense of business" is quite vital and that it helps him a great deal since he meets some of the situations which would be new to him such that he has no previous similar cases to base his decisions on. This necessitates him to call his minds into a meeting and come up with legit solutions based on the situation at hand.

How Each Leader Conceptualizes Success through their Leadership

Goyder said that he made it easier to do most of the things in future. He has ensured that the culture of the company is transparent between the board and the senior management such that information would not be filtered or altered anyhow without prior consent. He led the process of breaking down the business and putting it into a smaller divisional structure which is now the current operation making it easier to manage and oversee job performance.

Apart from other qualifications, Goyder is one leader with a good financial management background which makes him win the trust of many clients both locally and internationally. He strives a lot to be transparent in all the transactions he made. These include the deals he booked and lost, the product plans, the amount of capital raised and the financial statements summary is presented in a clear manner. This ensures that no employee would complain about not knowing whatever was going on in the company or had no information regarding the financial position of the company and its progress. Goyder would only not disclose the information about the personnel re-org details and the payroll because such would be a personal information which needs privacy. This is a necessary effort to ensure that every employee knows how important they are in the company and how their efforts matter in positioning the company to higher heights of performance. He is also a leader who knows how to deal with problems as soon as they arise. As realized by the researchers, it is not possible to respect or trust a leader who in case of a crisis just lets the problematic person hang on, Goyder is always keen to address any operational issue in a fast and efficient manner before it bears numerous disadvantages. He is fair and consistent in his problem-solving hence building the followers' trust since he is a mindful and action leader.

In his efforts, Ken Mackenzie showed strong leadership qualities by navigating the firm through a financial crisis in making some critical decisions to improve the returns of the shareholders. This enabled him to clean up the messes caused by the previous CEOs. In a span of four years in leadership, he made a significant reduction in costs across the business and a reducing down of the assortment through the partition of South 32. His financial intelligence is also outstanding hence earning him the trust of the clients the employees. He was able to understand the financial position and financial crisis and always worked hard to come up with a way of settling them. He ensured that the company had zero debts most of the times and in case there were some, the gap between the debts and the profits earned would be so big to lay down the company. He owned the budgeting skills that helped him in avoiding unnecessary debts and able to manage the company needs in an appropriate manner.

Based on the previous pattern of leadership and approaches, Andrew is able to classify situations and compare them with different ways of approaches so as to determine the best approach to a business situation. His listening skills are quite excellent, and he gives a chance to his followers to speak their feelings, complains and submits reports. He expresses attentiveness or expressing excitement when listening to a follower.

Critical Evaluation of How Each Leader’s Practice of Leadership Impacts the Success of Their Respective Organizations

Ken Mackenzie, had different approaches to leadership whereby he would be focused to complete the required tasks, accomplish the company's objectives, maintain the current situation of the firm and motivate his followers through agreements. This form of leadership is known as transactional leadership which also allows the followers to fulfill their desired interests, reduce work anxiety and focus on achieving the goals of the organization. He believed that his leadership should gratify both individual needs and the goals of the organization. His leadership was characterized by using his powers to give incentives to his followers so as to motivate them to deliver the best efforts of the organization. He was focused on ensuring that every day-day activities flowed smoothly rather than looking into guiding the company to attain a proper market position. He loved team-building activities as he believed they are good ways of understanding the individual talents of his followers. Having to engage in these teams also enabled him to gather more information from them as they would feel free when working together as teams. This also encouraged collaboration with the employees at different levels of work which enabled initiating change which helped a lot to improve performance and provide opportunities for professional and individual enhancement. This plays a great role in encouraging the employees and improving their job morale as they are meant to perceive work as a means of advancing themselves rather than just a means of getting pay. Richard Goyder was good at developing cohesion with his employees by calling regular meetings which would enable him to ask the employees questions of concern and enable him to get a relevant feedback. This would help him identify the gaps that need to be filled and the weaknesses that needed to be dealt with so as to keep the firm in profit-generating position and also maximize the outputs. He was able to handle all the details and points of concern in a quest to develop a strong, detailed output in the fastest means possible and earn a market reputation hence improving the image of the firm. In conjunction to this, he would not hesitate to keep his employee's needs on the front line so as to motivate them to maintain high standards of productivity. His team-building skills enabled him to achieve more ambitious goals and achieve a rapid success due to his strong visions. He possessed the ability to design and communicate relevant decisions and change needed to implement strategic policies. He had excellent communication skills, and this helped him a lot in maintaining his good relationship with the other employees. One of the skills he possessed is the communication skills. He was able to communicate more in a visible and active manner when crises arose in the company. He was able to put himself in a direct contact with the people of the press and was able to contact news conferences.

Andrew Mackenzie was able to communicate in public and having his views and decisions aired out to the public by the news people was a good catalyst to make the clients more confident of their products, and also the employees developed more trust and felt good being associated with him. When delivering a presentation, he was keen to ensure that he does it perfectly so as to avoid boring the audience. His presentation was one that no one would ever like to miss since he used to create jovial moods mixed up with humor to capture the attention of the audience. This skill also made him get the followers understand his message, analyze it well and also get to act on whatever he said. His ability to understand body language would also help him get to recruit the right candidates for the right positions since during interviews, he would be able to read the body language of the interviewees and understand it making him assess the honesty of the candidate. He would also tell whether whatever he is saying is making the audience comfortable or he is hurting them and whether the followers were confident with what they are saying. This would be advantageous especially during negotiations, conducting meetings and delivering speeches. However, he lacked the listening skills which are very vital in any form of communication.

Identification of Organizational Issues faced by Ken Mackenzie

Despite the great leadership qualities that these three leaders possessed, Ken had a weakness which afforded him some drawbacks. The leader is less in realistic optimism which means that he would daydream about innovative ideas which sounds great in theory or have his heads in the clouds while in reality, they lack world application. This makes him be curious about the future, and this blurs him from concentrating much on the current performance and the current issues. This makes him to lack confident in whatever he was doing for the company and unable to face many of the challenges that came his way and confront the difficulties faced by the company.

Advice to the Leader on How to Address These Issues

I would recommend that Ken combines an honest evaluation of the potential challenges of the companies with a positive attitude. This is to say that as he imagines of taking the company to greater achievements, he should also think of the possible challenges on the way and have a good mechanism for overcoming or handling them. For example, in cases of crisis, the CEO should embrace the situation with no fear knowing that every obstruction has got a way out regardless of the magnitude of the difficulty. He should maintain the events in proportion and should make intensive efforts to be able to celebrate his successes and those of others to expand his minds and get tips on how to achieve more from them.

Conclusion and Recommendations

Generally, the work of a CEO entails having the ability to lead tactfully and embracing different leadership skills to become effective as the success of any organization lies in the leadership skills of the CEO. The application of leadership theories by the three CEOs helpful in enhancing the success of the companies they manage. The trait theory of leadership argument that different leaders share similar traits which instinctively help them achieve organizational success. The ability to possess innate skills will help the leaders lead more effectively with the proper understanding of all the employees under their management. The behavioral theories of leadership focus on how these three leaders behave. The three leaders exemplary show commitment and expect cooperation from the subordinates and this enhances their democratic nature of leadership under which every employees idea is appreciated. This paper has discussed three CEOs of the prominent Australian companies and their approaches to leadership which have enabled them to place the firms in a recognizable position internationally. The three leaders were all geared towards success and continuous development of their companies. However, their approaches in leadership were significantly different. Richard Goyder has been the CEO of Wesfarmers whereby he has made it grow from a small company to become among the top most companies in Australia based on his leadership skills. Further, the existing situations in these companies force the leaders to apply contingency theories of leadership. The fact that no best skill or style of leadership helps solve a problem, the use of path-goal theory and transactional leadership is required. Among them is the ability to remain transparent in his undertakings which helped him identify any possible path for further success. Ken Mackenzie also led packaging company called Amcor Limited Company as the CEO for ten years where he left a mark of having achieved a zero-injury working environment. His financial intelligence made him also achieve a zero debt state of the company. Andrew Mackenzie of Billiton Group made use of his company knowledge to make decisions which would maximize profit margins. However, his efforts to make the company shine the more, he would make unrealistic decisions at times which would affect the current performance of the company. Allowing himself to have a way of dealing with possible challenges would help him a lot to achieve more success both now and in future.

Therefore, the three leaders must employ the use of trait, contingency, and behavioral theories of leadership in order to reap the fruits of success. The leaders must lead democratically by valuing the ideas of all subordinates staff since this motivates and improves their morale. Further, the leaders must learn how to understand different skills, knowledge, and expertise of their employees in order to facilitate the division of labor in accordance with each employee’s area of specialization. Further, the three leaders must learn how to make quick, accurate, and proper decisions that affect workplace operations guided by the contingency theories of leadership.

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