OYAGSB UUM2014 Slide 1

Leadership Style and Organizational Effectiveness

The Sony-Ericsson Endeavour1

Presented byHashamuddin bin Yaakob

(900278)

Presented toDr Caroline M. Acosta

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Agenda1. Introduction – What is Leadership?2. Major Leadership issues/decision made in

case3. Effectiveness Leadership decision at the time4. Effect Leadership decision in current situation5. Leadership Lessons6. Conclusion

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What is Leadership ?“The ability to influence a group

toward the achievement of

goals” (Robbins 2003)

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Robbins, Stephen. Organizational Behavior. 10th ed. Upper Saddle River, NJ: Prentice, Hall, 2003.

“Management is doing things right, leadership is doing the

right things” (Warren Bennis and Peter Drucker)

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Leadership TheoryThe Evolution of Leadership Theory

1940 1950s 1960s 1970s 1980s 1990s

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Trait Theory

Behavioural Styles Theory

Contingency Theory

Transformational Theory

Transactional Theory

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Leadership IssuesIssues Sony Ericsson

• Joint-venture

• Culture• Synergy

Creating a successful JV

Has been able to considerably broaden its platform for mobile communication

Great significance for its future presence in advanced electronics consumer

Concentrate on its future in mobile infrastructure

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Sony Background / Structure1994 Major changes – organizational structure – creation new

company

1966 Organizational structure was done

1999 Strategic organizational change was introduced – four main gateways for hardware

2001 Reform of the headquarter section – created global hubs (entertainment, game, financial service, internet/communication service

2003 Major change – Transformation 601. Clarifying operational structure and

concentrating technology and resources2. Fundamentally reforming operational profit

structure

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Ericson Background / Structure

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An engineering company with limited attention to R&D until mechanical switches were replaced by digital

The situation gradually shifted from early 1960sNew strategy in the early 1980s – embedded in

the Ericsson Information System (EIS) – launched its concept “office of the future”

1988 : new corporate strategy was formulated – focus on telecommunications

Late 1990s : overstaffing problem which existed in many quarters of the company

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Sony – Ericsson Partnership Components

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Ericsson Sony

Staff original numbers in early 2001

3,000 1,500

Market knowledge – telecom operators

Of some importance

Limited

Market knowledge – consumer electronics

Limited Very important

Handset technology

Very valuable Sony did not want to pay

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Sony – Ericsson (JV)

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Late 2000s : formal discussion were held between Ericsson & Sony

April 2001 : Sony introduced major organization reform

Soft Alliance with Qualcomm & Siemens both failed

2001 : serious discussions before start of reorganizing its operations

50/50 JV

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Leadership at the time

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Sony CultureEmphasizes “a spirit of freedom and open-mindedness”Fighting spirit to innovate

Sony’s SpiritAlways sough to create innovative products that inspire

new lifestyles

Life at SonySony aims to create a workplace that inspires

employees to pursue new challenges and grow by realizing their creative and innovative potential

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Leadership decision in current situation

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Sony may adopt the strategic actions as follows:

Maintain The Leader Position in Product Innovation & Quality

Invest in Broadband Network Invest in Internet-Enabled ProductsReinforce Brand Values & Promote a World Class BrandEncourage Dreams

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Leadership decision in current situation

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What Are Sony’s Success Factors?

Visionary LeadershipReligious Zealous to InnovationPioneer AdvantageHuman Capital

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Leadership Lesson

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Leadership TheoryTransformational Leader

1. Leaders stimulate and inspire (transform) followers to achieve extraordinary outcomes

2. Characteristics:I. Leadership is proactiveII. Works to change the organizational

culture by implementing new ideasIII. Employees achieve objectives through

higher ideals and moral valuesIV. Motivates followers by encouraging

them to put group interests firstV. Intellectual stimulation: Promote

creative and innovative ideas to solve problems.

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People will follow a

person who inspires them.

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Leadership TheoryTransactional Leader

1. Leaders promote compliance of his followers through both reward or punishment.

2. Characteristics:I. Leadership is reactiveII. Works within the organizational cultureIII. Employees achieve objectives through

rewards and punishments set by leaderIV. Motivates followers by appealing to

their own self interestV. Management-by-exception: maintain the

status quo; stress correct actions to improve performance

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Subordinates are not

self-motivating

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Leadership TheoryContingency Theory

1. According to the contingency approach of leadership, a single leadership style is not applicable to all situations.

2. Contingency models of leadership styles:I. Fiedler’s Contingency ModelII. Hersey and Blanchard’s situational theoryIII. Path Goal TheoryIV. Tannenbaum and Schmidt’s leadership

continuum

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a single leadership style is not applicable

to all situations

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Leadership StyleResearch done by the consulting firm Hay-McBer Associates (Harvard Business Review, 2000), found six different leadership styles as the following:

1. The coercive style2. The authoritative style3. The affiliative style4. The democratic style5. The pacesetting style6. The coaching style

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Leadership Style-Details

Coercive Authoritative Affiliative

Mode of Operation

Demand immediate compliance

Mobilize people toward a vision

Create emotional bonds and harmony

The style in a phrase “Do what I tell you.” “Come with me.” “People come first.”

Advantage Efficient and effective

Maximizes people's commitment toward organization goal, enhance clarity and flexibility

Drives up trust and flexibility, build up sense of recognition and belonging.

DisadvantageErode flexibility, motivation and responsibilty.

Failed when a leader is working with a team of experts who are more experienced than him

Allow poor performance to go uncorrected, and leaves people rudderless

When the style works best

In a crisis, to kick start a turnaround, or with problem employees

When changes require a new vision, or when a clear direction is needed

To heal rifts in a team/ motivate people during stressful circumstances

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Leadership Style-Details

Democratic Pacesetting Coaching

Mode of Operation Build consensus through participation

Expect excellence and self-direction

Develop people for the future

The style in a phrase “What do you think?” “Do as I do, now.” “Try this.”

Advantage Drives up flexibility and responsibility

Fast pace, focus and result oriented.

Coaching improves flexibility, responsibility and commitment.

DisadvantageEndless meetings and elusive consesus. People end up feeling confused and leaderless

Erode Flexibility and responsibility. Lack of commitment.

Time consuming

When the style works best

To build buy-in or consensus, or to get input from valuable employees

To get quick results from a highly motivated and competent team

To help an employee improve performance or develop long-term strengths

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Conclusion1. This study provides the background for two companies in

telecommunication and how they joined forces in the development of future mobile communications

2. Combination Sony-Ericsson – an ideal international JV3. Major conclusion:

1. Different types of cultural gaps should have been addressed at an early stage

2. Considerable time would have been needed to identify mutual shortcomings and hidden agenda

3. Stated goals should have been more clearly matched with available resources

4. Stated goals should have been more supported by appropriate strategies

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Conclusion“…to create organizational effectiveness and

ensure sustainability, business leaders need to focus their attention on aligning their people, the systems, the structure and roles with the organization’s strategy, while engaging their

employees with their jobs and with the organization.”

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