Leadership and Business Diplomacy

Leadership

According to a Layman, Leadership is the process of encouraging and helping others to work

enthusiastically towards objectives.

“When you boil it down, contemporary leadership seems to a matter of aligning people toward

common goals and empowering them to take the actions needed to reach them.”

Sherman, 1995

A Leadership Story

A group of workers and their leaders are set a task of clearing a road through a dense jungle on

a remote island to get to the coast where an estuary provides a perfect site for a port.

The leaders organise the labour into efficient units and monitor the distribution and use of

capital assets – progress is excellent. The leaders continue to monitor and evaluate progress,

making adjustments along the way to ensure the progress is maintained and efficiency increased

wherever possible.

Then, one day amidst all the hustle and bustle and activity, one person climbs up a nearby tree.

The person surveys the scene from the top of the tree.

And shouts down to the assembled group below…

(Story adapted from Stephen Covey (2004) “The Seven Habits of Highly Effective People” Simon

& Schuster).

Styles of Leadership

There are four types of Leadership styles:

Autocratic

Democratic

Laissez-Faire

Paternalistic

AUTOCRATIC

Leader Expects complete obedience from his subordinates.

No Suggestions or initiative from subordinates is entertained.

The power of decision making is in the hands of the leader.

Can create de-motivation and alienation of staff.

Leader is the formal head of the org. and is generally disliked by the subordinates.

DEMOCRATIC

This style implies compromise between autocratic and laissez-fair style of leadership.

Encourages decision making

from different perspectives – leadership may be emphasised throughout

the organisation

Consultative: process of consultation before decisions are taken

Persuasive: Leader takes decision and seeks to persuade others that the decision

is correct

May help motivation and involvement.

Workers feel ownership of the firm and its ideas.

Improves the sharing of ideas

and experiences within the business.

Can delay decision making.

LAISSEZ-FAIRE

Maximum freedom is allowed to subordinates

Free to make independent decisions.

Creates self confidence in workers and provide them an opportunity to develop their talents.

Can be very useful in businesses where creative ideas are important.

PATERNALISTIC

Leader acts as a ‘father figure’

Paternalistic leader makes decision but may consult

Believes in the need to support staff

Trait Theory

Trait which are essential to be a successful leader

Believe is that the leadership traits are inherited or in born

It consider personality, social, physical, or intellectual traits to differentiate leaders from non-

leaders

Leadership behavior - facilitating goal attainment and recruitment of followers regardless of the

context (5 usual traits)

Intelligence

self-confidence

determination

integrity

sociability

Leadership Traits

• Ambition and energy

• The desire to lead

• Honest and integrity

• Self-confidence

• Intelligence

• High self-monitoring

• Job-relevant knowledge

LIMITATIONS

• No universal traits found that predict leadership in all situations.

• Traits predict behavior better in “weak” than “strong” situations.

• Unclear evidence of the cause and effect of relationship of leadership and traits.

• Better predictor of the appearance of leadership than distinguishing effective and ineffective

leaders.

Behavioral Theory

Leadership involves an interpersonal relationship between a leader and subordinates.

It proposes that specific behaviors differentiate leaders from non-leaders.

Emphasized on particular behavior by him

The main purpose of this theory is to determine how various kinds of specific behavior affect the

performance and satisfaction of subordinates.

Contingency Theories

This is a leader match theory because it tries to match leaders to appropriate situations

A leader’s effectiveness depends on how well the leader’s style fits the context

The theory was developed by studying the styles of leaders in situations and whether they were

effective (primarily in military organizations)

Concerned with styles and situations

Leadership styles are either task motivated or relationship motivated

Situations have three factors: leader-member relations, task structure and position power

Leadership as being more flexible – different leadership styles used at different times depending

on the circumstance.

Suggests leadership is not a fixed series of characteristics that can be transposed into different

contexts

It depend on:

• Type of staff

• History of the business

• Culture of the business

• Quality of the relationships

• Nature of the changes needed

• Accepted norms within the institution

Path Goal Theory

Path Goal theory is about how leaders motivate subordinates to accomplish designated goals

The stated goal of leadership is to enhance employee performance and employee satisfaction by

focusing on employee motivation

Emphasizes the relationship between the leader’s style and characteristics of the subordinates

and the work setting

The leader must use a style that best meets the subordinates motivational needs

Advantages:

Helps understand how leader behavior effects subordinates satisfaction and work performance

Deals directly with motivation – one of the only theories to address this

Provides a very practical model – make a clear path and follow it

Limitations:

This is a very complex theory that incorporates many aspects of leadership

Research only partially supports the theory

Fails to explain adequately the relationship between leader behavior and subordinate

motivation

Treats leadership as a one way street, places a majority of the responsibility on the leader

CASE STUDY

Govind Bhagat

Born: November 7, 1951 at Dudhala Village Situated in Amreli District, Gujarat, India.

Occupation: Diamond Guru, Entrepreneur, Chairman – Shree Ram Krishna Export

Govindbhai Laljibhai Dholakia, better known as “Govind Bhagat”, born in Dudhala, Amreli, Gujarat, is an

entrepreneur and policymaker of diamond industry. He is Chairman and CEO of Shree Ramkrishna

Export and Jewel Goldi. A leader of Diamond Industry, Base of Jewel. He is Brilliant and Spiritual

personality...and providing good Corporate Social Responsibilities as Perfect Leader.

Contents

1. EARLY LIFE

2. BUSINESS MAKEOVER

3. ENTREPRENEURSHIP IN BUSINESS

- 5 TYPES OF INNOVATION

4. COMMUNITY WELFARE

- CARE FOR THE COMMUNITY

- EDUCATION

- MEDICAL

- ENVIRONMENT

- CULTURAL AND SOCIAL

5. AWARDS AND ACHIEVEMENTS

EARLY LIFE

Govindbhai Dholakia was born in India in the village of Dudhala, Gujarat. Basically being the farmers, his

parents and whole family was involved farming. The family was deeply attached to Lord Swaminarayan

but Govindbhai Dholakia was attached to Lord Ram-Krishna and their philosophies. So Shri Govindbhai

was deeply attracted towards Bhagwad Geeta. Govindbhai did his primary schooling from the school in

his neighboring village Lathi. Unfortunately, he could not complete his schooling but had to leave school

from 7th standard. After doing some farming at the early age he dreamed to come to Surat for earning

more income than his family could earn by farming. In 1964, at the age of 13, he came to Surat with his

elder brother.

He started his career as diamond cutting artisan in Surat. After the years of experience as artisan, he

came up with an idea of establishing his own manufacturing unit. Started the manufacturing unit in 1970

with his two other partners Mr. Bhagwanbhai Koshia and Mr. Virjibhai Godhani. During the years they

had to see many ups and downs. Finally, they commenced under the name Shree Ramkrishna Export. It

was constituted as a partnership firm.

Throughout the late 1970s and early 1980s he was involved in the diamond cutting and polishing. During

his four decades as a diamond entrepreneur Govindbhai Dholakia has been involved in various

charitable and medical institutes in Gujarat.

In 1995 the three partners separated as the part of further expanding the business. All the three

partners established their own company. Govindbhai Dholakia retained the name Shree Ramkrishna

Export and carried the manufacturing with his family members.

BUSINESS MAKEOVER

Govindbhai Dholakia is the Chairman and CEO of Shree Ramkrishna Export, an International Diamond

manufacturing & exporting company. He is also chairman of Jewel Goldi India, international Diamond-

studded Jewellery manufacturing and exporting to more than 30 countries worldwide. Company's two

diamond manufacturing factories are located in Surat with more than 5,000 workers on full time basis.

The jewellery manufacturing of the company is carried at two factories at Andheri, Mumbai. The sales

offices of the company are located in Mumbai, Antwerp, New York, Dubai, Israel, and Hong Kong.

Govindbhai Dholakia started Shree Ramkrishna Export with the capital of just Rs. 500, which was

borrowed from his neighbor. At present Shree Ramkrishna Export exports Polished Diamonds and

Diamond Studded Jewellery worth Rs. 600-700 Crores (6-7 billion).

He serves as an advisor to the Gem and Jewellery Export Promotion Council. Govindbhai Dholakia has mainly lived in Surat, Gujarat since 1964, with his wife Champaben Dholakia and three children. Govindbhai Dholakia believes in joint family values. He has 4 brothers and 2 sisters with family of more than 48 members. He has been actively involved in several schools and hospitals startups, and lectures extensively around the world on Diamonds & beyond diamonds.

Management Team of Shree Ramkrishna Export

ENTREPRENEURSHIP IN BUSINESS

As a Leader and Diamond King Govindbhai thinks that the jewellery industry has specialties of its own and is considered as a family business. He believes that the work is an art and only an artisan can work in this industry–besides, it is a creative business. He shared that the diamond business is based on trust and words and on a premise that there is no scope of cheating.

His point of views about entrepreneurship in the business is how entrepreneurship can be separated from a business and how can they be considered in two different ways. According to him business means “busy-ness” and everyone can be busy but entrepreneurship is associated with innovation. Entrepreneurship starts with innovation and it questions us what value addition or new thing have we done.

5 Types of innovation in Business Strategy

Make something new, innovation in the process, innovations in marketing, innovation in raw material, and organizational innovation. He also defined competitiveness; as when our product is better in quality and lower in price and is sold in the market before the competitor then it means that we are competitive. His opinion is that if prices are to be reduced, then efficiency has to be increased. Cost saving instead of cost Cutting is the way to be competitive and for that appropriate technology has to be adopted. In addition, the addition of new technology will affect associated people and hence skill development is critical. He pointed out the fact that since many people from unorganized sector are associated with the diamond industry, the quality is affected, because these people are profit oriented. But for sustainability, quality should be the focus and for this, skill development needs to be focused upon. He said that currently Surat is at the lower end of the value chain whereas at the higher end, there is De Beers and Cartier. He also put the things into perspective by telling that since diamond is not necessity but a luxury item, which an effluent person with surplus money will only buy so an entrepreneur needs to move up the value chain. He also defined professionalism as system in order that there is greater accountability and trust in the market. He also said that some companies are engaged in providing certifications in order to build trust so there is an urgent need to talk about professionalism, transparency and accountability. He also pointed out that scale is important. Being a leader, he advised that small units should club together and expand their horizons out of Surat and Mumbai market. Finally, he concluded that most of the entrepreneurs are imitative and successful but he advised them to be always innovative entrepreneurs.

COMMUNITY WELFARE

He is the founder and chairman for many trusts involved in community welfare activities. Shree Ramkrishna Charitable Trust - Jointly with his ex-partners. Shree Ramkrishna Welfare Trust - Jointly with his present partners. Dholakia Charitable Trust - Jointly with his family cousins. Matrushree Santokba Trust - Jointly with his family members. He is also trustee of various other trusts involved in charity and medical activities. The trust is actively involved in Community Care, Education, Medical, Environment care, and also Cultural & Social activities.

Care for the community

He believes in community caring. He has built Dholakia Garden for public use in Katargam, Surat. The garden is maintained by Govindbhai Dholakia. He had built two villages for the earthquake victims in Kachchh, Gujarat.

Education

He has set up V .N. Godhani Girls School to encourage women's education. Started an English medium school called Godhani English School to encourage the English language proficiency. Set up the Ramkrishna Expert High School to craft the next generation of youngsters to excel.

V.N. Godhani Girl’s School at Surat

Medical

He runs medical centers which provide a complete range of facilities for diagnosis and treatment. The

centers has facilities like pathological laboratories, x-ray & sonography centers, and also provides

consultation with experts at a nominal cost. More than 1, 50,000 patients visit the center annually. The

medical centers are located at Surat and Lathi, Amreli.

Govindbhai is involved in managing Pran-nath Hospital, Mahavir Hospital and he is also involved in many

other hospitals and medical institutes. As an addition He also operates Aids Care Network with the help

of Government of Gujarat.

Environment

Govindbhai Dholakia is the main trustee in Saurashtra Jal Sanchay Trust. The trust makes check dams & saves rain water in rural areas. Welcome Clarity Club in Surat is run for cleaning the city and tree plantation. He believes on clean and green city.

Cultural and Social

Govindbhai is involved in Social activities by organizes many social and cultural programs for community such as Plays, Prayers, etc. AWARDS AND ACHIEVEMENTS

Govindbhai Dholakia received “Suryapur Ratna” Award by Surat Municipality Corporation in 2005 for

outstanding contribution towards welfare and development of Surat city.

Recieved “GJEPC – India” award for outstanding export of cut and polished diamonds in the year 2001-

2002.

Govindbhai Dholakia's company Shree Ramkrishna Export was honored with the “Sightholder” by

Diamond Trading Company (DTC). The De Beers selected Shree Ramkrishna Export as 'Sightholder'.

Govindbhai has also received many other awards for his contribution to various welfare activities.