PRINCIPLES OF MANAGEMENT AND LEADERSHIP

Pearson BTEC Level 5 in Management and

Leadership

Table of Contents 1. Understand leadership and management theories and principles ........................................... 2

Leadership and management............................................................................................................................ 2

SOME OF THE COMMON TRAITS SHARED BY STRONG MANAGERS ARE: ............................. 2

The Three Important Differences ................................................................................................................... 5

Leadership Principles............................................................................................................................................. 7

Strategic vision .......................................................................................................................................................... 8

Some not-so-great Vision Statements (and why) ................................................................................ 9

The Process ................................................................................................................................................................ 10

Leadership Theories ............................................................................................................................................. 13

Business performance ......................................................................................................................................... 18

2. Understand leadership styles ........................................................................................................................ 24

Leadership and management styles ........................................................................................................... 24

The Six Emotional Leadership Styles ......................................................................................................... 26

Adaptive management ........................................................................................................................................ 29

Ethical dimensions ................................................................................................................................................ 34

3. Understand motivation and empowerment .......................................................................................... 35

Motivation ................................................................................................................................................................... 35

Empowerment .......................................................................................................................................................... 45

Reward strategy ..................................................................................................................................................... 46

4. Understand the management of performance .................................................................................... 47

Performance management ............................................................................................................................... 47

1. Understand leadership and management theories and

principles

Leadership and management Is a good manager automatically a good leader? What is the difference between

leadership and management?

The main difference between leaders and managers is that leaders have people follow them

while managers have people who work for them.

A successful business owner needs to be both a strong leader and manager to get their team on

board to follow them towards their vision of success. Leadership is about getting people to

understand and believe in your vision and to work with you to achieve your goals while

managing is more about administering and making sure the day-to-day things are happening as

they should.

WHILE THERE ARE MANY TRAITS THAT MAKE UP A STRONG LEADER, SOME OF THE KEY

CHARACTERISTICS ARE:

Honesty & Integrity: are crucial to get your people to believe you and buy in to the

journey you are taking them on

Vision: know where you are, where you want to go and enroll your team in charting a

path for the future

Inspiration: inspire your team to be all they can by making sure they understand their

role in the bigger picture

Ability to Challenge: do not be afraid to challenge the status quo, do things differently and

have the courage to think outside the box

Communication Skills: keep your team informed of the journey, where you are, where you

are heading and share any roadblocks you may encounter along the way

SOME OF THE COMMON TRAITS SHARED BY STRONG MANAGERS ARE:

Being Able to Execute a Vision: take a strategic vision and break it down into a roadmap to be followed by the team

Ability to Direct: day-to-day work efforts, review resources needed and anticipate needs along the way

Process Management: establish work rules, processes, standards and operating procedures

People Focused: look after your people, their needs, listen to them and involve them In order for you to engage your staff in providing the best service to your guests, clients or

partners, you must enroll them in your vision and align their perceptions and behaviors. You need to get them excited about where you are taking them while making sure they know what’s in it for them.

With smaller organizations, the challenge lies in making sure you are both leading your team as well as managing your day to day operation. Those who are able to do both, will create a

competitive advantage. Are you both a leader and a manager; what would your staff say if you were to ask them?

What’s the Difference between Leadership and Management?

Many wonder about the differences between leadership and management. Are they mutually

exclusive? Do professionals have both qualities—or do they learn one or the other over a long period of time? These questions are just the tip of the iceberg. In this article, we will take a look

at both.

What is Leadership? What is Management?

The words “leader” and “manager” are among the most commonly used words in business and

are often used interchangeably. But have you ever wondered what the terms actually mean?

What Do Managers Do?

A manager is the member of an organization with the responsibility of carrying out the four important functions of management: planning, organizing, leading, and controlling. But are all managers leaders?

Most managers also tend to be leaders, but only IF they also adequately carry out the leadership responsibilities of management, which include communication, motivation, providing inspiration

and guidance, and encouraging employees to rise to a higher level of productivity.

Unfortunately, not all managers are leaders. Some managers have poor leadership qualities, and employees follow orders from their managers because they are obligated to do so—not

necessarily because they are influenced or inspired by the leader.

Managerial duties are usually a formal part of a job description; subordinates follow as a result

of the professional title or designation. A manager’s chief focus is to meet organizational goals and objectives; they typically do not take much else into consideration. Managers are held

responsible for their actions, as well as for the actions of their subordinates. With the title comes the authority and the privilege to promote, hire, fire, discipline, or reward employees based on their performance and behavior.

What Do Leaders Do?

The primary difference between management and leadership is that leaders don’t necessarily

hold or occupy a management position. Simply put, a leader doesn’t have to be an authority figure in the organization; a leader can be anyone.

Unlike managers, leaders are followed because of their personality, behavior, and beliefs. A

leader personally invests in tasks and projects and demonstrates a high level of passion for work. Leaders take a great deal of interest in the success of their followers, enabling them to

reach their goals to satisfaction—these are not necessarily organizational goals.

There isn’t always tangible or formal power that a leader possesses over his followers. Temporary power is awarded to a leader and can be conditional based on the ability of the

leader to continually inspire and motivate their followers.

Subordinates of a manager are required to obey orders while following is optional when it comes

to leadership. Leadership works on inspiration and trust among employees; those who do wish to follow their leader may stop at any time. Generally, leaders are people who challenge the status quo. Leadership is change-savvy, visionary, agile, creative, and adaptive.

Are The Traits A Manager Possesses?

Below are four important traits of a manager.

#1 The ability to execute a Vision: Managers build a strategic vision and break it down into a roadmap for their team to follow.

#2 The ability to Direct: Managers are responsible for day-to-day efforts while reviewing necessary resources and anticipating needs to make changes along the way.

#3 Process Management: Managers have the authority to establish work rules, processes,

standards, and operating procedures.

#4 People Focused: Managers are known to look after and cater to the needs of the people they

are responsible for: listening to them, involving them in certain key decisions, and accommodating reasonable requests for change to contribute to increased productivity.

What Are The Traits A Leader Possesses?

Below are five important traits of a leader.

#1 Vision: A leader knows where they stand, where they want to go and tend to involve the team in charting a future path and direction.

#2 Honesty and Integrity: Leaders have people who believe them and walk by their side down

the path the leader sets.

#3 Inspiration: Leaders are usually inspirational—and help their team understand their own

roles in a bigger context.

#4 Communication Skills: Leaders always keep their team informed about what’s happening,

both present and the future—along with any obstacles that stand in their way.

#5 Ability to Challenge: Leaders are those that challenge the status quo. They have their own style of doing things and problem-solving and are usually the ones who think outside the box.

The Three Important Differences Being a manager and a leader at the same time is a viable concept. But remember, just because

someone is a phenomenal leader it does not necessarily guarantee that the person will be an

exceptional manager as well, and vice versa. So, what are the standout differences between the

two roles?

#1 A leader invents or innovates while a manager organizes.

The leader of the team comes up with the new ideas and kickstarts the organization’s shift

or transition to a forward-thinking phase. A leader always has his or her eyes set on the horizon,

developing new techniques and strategies for the organization. A leader has immense knowledge

of all the current trends, advancements, and skillsets—and has clarity of purpose and vision.

By contrast, a manager is someone who generally only maintains what is already established. A

manager needs to watch the bottom line while controlling employees and workflow in the

organization and preventing any kind of chaos.

In his book, The Wall Street Journal Essential Guide to Management: Lasting Lessons from

the Best Leadership Minds of Our Time, Alan Murray cites that a manager is someone who

“establishes appropriate targets and yardsticks, and analyzes, appraises and interprets

performance.” Managers understand the people they work with and know which person is the

best fit for a specific task.

#2 A manager relies on control whereas a leader inspires trust

A leader is a person who pushes employees to do their best and knows how to set an

appropriate pace and tempo for the rest of the group. Managers, on the other hand, are required

by their job description to establish control over employees which, in turn, help them develop

their own assets to bring out their best. Thus, managers have to understand their subordinates

well to do their job effectively.

#3 A leader asks the questions “what” and “why whereas a manager leans more towards

the questions “how” and “when.”

To be able to do justice to their role as leader, some may question and challenge authority to

modify or even reverse decisions that may not have the team’s best interests in mind.

Good leadership requires a great deal of good judgment, especially when it comes to the ability

to stand up to senior management over a point of concern or if there is an aspect in need of

improvement. If a company goes through a rough patch, a leader will be the one who will stand

up and ask the question: “What did we learn from this?”

Managers, however, are not required to assess and analyze failures. Their job description

emphasizes asking the questions “how” and “when,” which usually helps them make sure that

plans are properly executed. They tend to accept the status quo exactly the way it is and do not

attempt a change.

The Three Tests

In the article Three Differences Between Managers And Leaders, Vineet Nayar discusses three

tests he devised to help managers decide if they have successfully made the shift from

managing people to leading them.

#1 Counting Value vs. Creating Value

Managers are the only ones who count value, he says. There are some who cut down on

the value by disabling or otherwise countering ideas and people who add value.

Leaders, however, focus instead on working to generate a certain value that is over and above

that which the team creates—and is as much a creator of value as their followers. Nayar goes on

to say that, “Leading by example and leading by enabling people are the hallmarks of action-

based leadership.”

#2 Circles of Influence vs. Circles of Power

As mentioned previously, managers have subordinates and leaders gain followers, which

implies that managers create a circle of power while leaders create a circle of influence. Nayar

offers advice on how to identify which circle you have around you. He says, “The quickest way to

figure out which of the two you’re doing is to count the number of people outside your reporting

hierarchy who come to you for advice. The more that do, the more likely it is that you are

perceived to be a leader.”

#3 Leading People vs. Managing People

One responsibility of a manager is controlling a group in order to accomplish a certain

goal. Leadership, on the other hand, is the ability of an individual to motivate, influence, and

enable other employees to make a contribution toward the success of an organization.

Inspiration and influence separate leaders from managers—not control and power.

Leadership Principles

There is a great amount of definitions and theories about effective leadership. Each leader

chooses their unique formula of success, but still there are keys to authentic leadership that

can’t be ignored. Below are 10 important principles each leader should know.

1. Leadership Is Behavior, Not Position

Leaders are the ones who take responsibility for making decisions and bringing change. Leaders

are the ones who empower people to discover and use their greatest potential. The executive

position on someone’s visit card won’t do all of these. People are the ones to choose their leader.

And how will they do that? They will judge by behavior, attitude and actions. If you want to be a

leader, then act like a leader and shape a better reality.

2. The Best Way of Influence Is Setting an Example

Each leader wants to get the best out of their team. Excellence orientation is great, as there is

always need for development. But here is the simple truth. Instead of telling your team

members what to do, show it to them by your own example. They are following you each and

every moment. Practice what you preach, and the results will astonish you. Especially during

hard times, when chances to give up are very big, you should be the one who faces obstacles

with confidence and determination towards success. Be sure, that they will do the same and

stand by your side.

3. Leading Means Making an Impact

Think about the greatest leaders in history. What was the one thing they had in common? Yes,

they all made an impact. Leadership is not just setting goals and effectively achieving them with

your team. Leadership is not just brilliant public speaking and great communication skills. If you

want to be an authentic leader, you should have your unique contribution to the welfare of the

society. You should make a positive change.

4. Leadership is Chasing Vision, Not Money

Without a vision, your activities are meaningless. Each person can be very busy implementing

various tasks, but the key is devoting your efforts and time to the realization of your vision.

Vision is what inspires people to take action and go forward. Discover your unique vision and

coordinate all your activities towards it. Inspire each and every member of your team with that

vision.

5. Actions Speak Louder Than Words

It’s not a secret that much talking and less acting has nothing to do with effectiveness. What

people see affects them many times greater than what they hear. So, choose actions. Don’t

waste your and other people’s time on endless conversations about your plans. Just realize that

plans and be sure that everyone will see it.

6. Flexibility May Refer to Behavior, Not Values

Depending on circumstances you may choose a different style of leadership or communication.

Flexibility is a truly effective trait, if it doesn’t affect your values. Each and every decision of

yours, no matter the situation, must be based on your value system. As long as your actions are

value-driven, you will have the trust and respect of people around you.

7. Leadership is All About People

Could you be a leader in an empty room by having profound goals and skills? Of course, not.

Leading means communicating, influencing and engaging. Communication skills are the

foundation of effective leadership. Constantly improve your relationships with people, and the

amazing results won’t make you wait.

8. It Is Fine To Admit Mistakes

If everything has always been done perfectly, we would have somehow lost the ability to analyze

and improve. Mistakes are proof that you are doing something. You won’t become a worse

leader if you admit your mistakes. By doing that, you will show that you are wise enough to

learn from your each and every experience.

9. Unity Is Strength

Team is somehow the most important resource for each leader. Embrace your team and devote

your energy to care about its unity each and every day. As long as your team is splendid,

nothing can stay on your way to success. Make sure that all people in your team consider

themselves as members of a strong, unified family.

10. There Is Always Room for Growth

Remember, satisfaction should be a short-term feeling. Life would become useless without

ongoing improvement. This doesn’t mean that you shouldn’t appreciate what you have. This

means that you should be thankful for everything you have achieved, but still try to do a little

more for this world.

Strategic vision

There are a few common rules that pretty much all good Vision Statements should follow:

1. They should be short – two sentences at an absolute maximum. It’s fine to expand on

your vision statement with more detail, but you need a version that is punchy and easily

memorable.

2. They need to be specific to your business and describe a unique outcome that only you

can provide. Generic vision statements that could apply to any organisation won’t cut it

(see our examples below for more on this point).

3. Do not use words that are open to interpretation. For example, saying you will ‘maximise

shareholder return’ doesn’t actually mean anything unless you specify what it actually

looks like.

4. Keep it simple enough for people both inside and outside your organisation to

understand. No technical jargon, no metaphors and no business buzz-words if at all

possible!

5. It should be ambitious enough to be exciting but not too ambitious that it seems

unachievable. It’s not really a matter of time-framing your vision, because that will vary

by organisation, but certainly anything that has a timeframe outside of 3 to 10 years

should be challenged as to whether it’s appropriate.

6. It needs to align to the Values that you want your people to exhibit as they perform

their work. We’ll talk more about Values in a future article – but once you’ve created

those Values later on, revisit your Vision to see how well they gel.

Following these rules should give you a pretty good starting point for creating your own vision

statement. To help refine things further, we’ll now look at some examples of vision statements

that did not follow these rules.

Some not-so-great Vision Statements (and why) Here are some examples of real-life vision statements that in our opinion, could do with a little

tweaking. For each one, we’ll try to justify our thinking…

Our company vision is to make every brand more inspiring and the world more intelligent.

Well, this one gets a tick on the ‘ambitious’ test if nothing else. But…..is it realistic that ‘every

brand’ will use the services of this company? How about ‘making the world more intelligent.’ –

let’s try to quantify what that might actually look like. Or let’s not. Because it’s impossible. Not

to be too harsh though – there are strong elements here; ‘making brands more inspiring’ makes

a lot of sense and has some depth.

Provide maximum value for our shareholders whilst helping our customers to fulfil their dreams.

This ‘vision’ could pretty much apply to any company, anywhere (it’s an insurance company in

this case – but would you have guessed that?). It’s sort of like saying ‘Our Vision is to succeed

as a business’. Not wrong – but certainly not inspiring or unique.

Last one…

We are committed to achieving new standards of excellence by providing superior human capital

management services and maximizing the potential of all stakeholders – clients, candidates and

employees – through the delivery of the most reliable, responsive….[and it goes on, but

that’s probably enough]…

It would be quite hard to write a vision statement filled with less tangibility and more

subjectivity that this one. ‘New standards of excellence’. ‘Superior human capital management’.

‘Maximising the potential’. There are simply far too many buzz words, intangibles and vaguery

here for this to be either memorable or inspiring.

We are of course being rather harsh. But hopefully the above examples illustrate well some of

the pitfalls to avoid when creating your own vision.

The Process There are literally hundreds of articles out there that will give you examples of good and bad

vision statements as well as a high-level overview of what to consider when creating your

own. But what we noticed was lacking was a concrete process to go through to help you create

one. As such, we’ve outlined a process that we have used with clients in Cascade that might

work for you too.

There are plenty of great vision statements out there that will not conform to the process below

– but if you’re struggling or just need a place to start, then hopefully this will help.

Step 1: Define what you do as an output

Start by being exceptionally clear about what it is your organisation actually does. Be careful to

remain ‘output focused’ rather than ‘input focused’. For example, Microsoft famously had a

vision statement to Put a Microsoft powered computer on every desk in the world (slightly

paraphrased). Strictly speaking what Microsoft ‘do’ is make computer software, but for the

purposes of their Vision, they looked forward to the actual outcome of this process – i.e.

computers on desks.

Let’s look at some other hypothetical examples:

A bakery makes bread. But the outcome is consumers enjoying that bread.

A consulting company gives advice. But the outcome is the success of others based on that

advice.

A government department does…lots of things. But the outcome is better lives for the citizens

they serve.

Whilst this process may seem obvious – you would be surprised by how rarely organisations

actually go through this process in a formal, written way. Doing so will take you a long way

towards creating your vision statement – BUT it’s not enough alone! If it was, all bakeries for

example would have the same vision statement – which is hardly inspiring!

Step 2: Define what unique twist your organisation brings to the above outcome

Very few products or services these days are truly new – most are more like reinventions of

something that exists already, but with a different approach, focus or spin.

At some point in your organisation’s lifespan – someone will have believed that the reason that

THIS organisation would be successful where others have failed, was because of………something.

You need to define that something!

Let’s take our bakery example. So far, our vision statement is looking pretty generic, along the

lines of customers enjoying our bread. But why will they enjoy our bread MORE than the bread

from the place next door? Is it because we use centuries old traditions passed through

generations of our family? Because we only use premium grade locally sourced

ingredients? Whatever your unique selling point is – let it shine through in your vision

statement.

Step 3: Apply some high-level quantification

A common problem with vision statements is ironically, that they are too visionary! With no

possible end in sight (or a totally unrealistic one) – the initial inspiration derived from a great

vision statement can quickly turn to frustration, or even cynicism among employees and

customers.

That said – don’t be too specific or apply specific metrics at this stage (they will come later in

our planning process).

Sticking with our bakery example – we might want to refine our target audience to ‘every

customer who walks through the door’ – that’s fine, or maybe we want to be bolder: ‘every

customer within walking distance of a store’.

The quantification we apply could also be industry specific if you’re a B2B – are you shooting for

SMEs or multinationals for example?

Step 4: Add relatable, human, ‘real world’ aspects

OK, your vision by this point should be getting pretty close to being finished. But one final trick

you can apply to help make it even more memorable is to add a real-life aspect so that people

can conjure up a solid mental image to associate with your vision statement. Let’s look at an

example – which of the following statements is likely to be more memorable:

a) To have every working person in the world using Microsoft product.

or…

b) A Microsoft powered computer on every desk.

I would argue that (b) is more memorable, because as I read this, I’m actually visualising

a computer (in my case) sitting on a wooden desk in a room. There’s nothing wrong with (a)

but it’s highly conceptual and thus difficult to transform into a mental picture. Let’s look at

another example:

Ensure that every customer who leaves our store, does so smiling.

Here, using the word ‘smiling’ as apposed to ‘happy’ is powerful, because it conjures a mental

image of a person smiling.

It won’t always be possible to bring this level of tangibility to your vision statement – but if it is,

I would strongly encourage doing so.

Bringing it all together

Let’s finish off with a look at what a completed vision statement could look like for our bakery,

based on the above:

Producing and selling locally sourced cakes and pies that are so delicious and satisfying, that

every customer who leaves our store does so with a smile.

If we deconstruct this into our various steps, we can see each at work as follows:

Producing and selling locally sourced cakes and pies that are so delicious and satisfying,

that every customer who leaves our store does so with a smile.

Step 1 – The output

Step 2 – The twist

Step 3 – The quantification

Step 4 – The human connection

Let me reiterate – there are other ways to construct great vision statements – but even if yours

doesn’t look quite like this at the end of the day, simply following the process above will help

you to bring structure and purpose to your effort.

Leadership Theories

For decades, leadership theories have been the source of numerous studies. In reality as well as

in practice, many have tried to define what allows authentic leaders to stand apart from the

mass! Hence, there as many theories on leadership as there are philosophers, researchers and

professors that have studied and ultimately published their leadership theory. A great article to

read before diving into the theories is the The Philosophical Foundations of Leadership

Theories are commonly categorized by which aspect is believed to define the leader the most.

The most widespread one's are: Great Man Theory, Trait Theory, Behavioural

Theories, Contingency Theories, Transactional Theories and Transformational Theories.

Great Man Theory (1840s)

The Great Man theory evolved around the mid 19th century. Even though no one was able to

identify with any scientific certainty, which human characteristic or combination of, were

responsible for identifying great leaders. Everyone recognized that just as the name suggests;

only a man could have the characteristic (s) of a great leader.

The Great Man theory assumes that the traits of leadership are intrinsic. That simply means that

great leaders are born...

they are not made. This theory sees great leaders as those who are destined by birth to become

a leader. Furthermore, the belief was that great leaders will rise when confronted with the

appropriate situation. The theory was popularized by Thomas Carlyle, a writer and teacher. Just

like him, the Great Man theory was inspired by the study of influential heroes. In his book "On

Heroes, Hero-Worship, and the Heroic in History", he compared a wide array of heroes.

In 1860, Herbert Spencer, an English philosopher disputed the great man theory by affirming

that these heroes are simply the product of their times and their actions the results of social

conditions.

Trait Theory (1930's - 1940's)

The trait leadership theory believes that people are either born or are made with certain qualities

that will make them excel in leadership roles. That is, certain qualities such as intelligence,

sense of responsibility, creativity and other values puts anyone in the shoes of a good leader. In

fact, Gordon Allport, an American psychologist,"...identified almost 18,000 English personality-

relevant terms" (Matthews, Deary & Whiteman, 2003, p. 3).

The trait theory of leadership focused on analyzing mental, physical and social characteristic in

order to gain more understanding of what is the characteristic or the combination of

characteristics that are common among leaders.

There were many shortfalls with the trait leadership theory. However, from a psychology of

personalities approach, Gordon Allport's studies are among the first ones and have brought, for

the study of leadership, the behavioural approach.

In the 1930s the field of Psychometrics was in its early years.

Personality traits measurement weren't reliable across studies.

Study samples were of low level managers

Explanations weren't offered as to the relation between each characteristic and its impact

on leadership.

The context of the leader wasn't considered.

Many studies have analyzed the traits among existing leaders in the hope of uncovering those

responsible for ones leadership abilities! In vain, the only characteristics that were identified

among these individuals were those that were slightly taller and slightly more intelligent!

Behavioral Theories (1940's - 1950's)

In reaction to the trait leadership theory, the behavioural theories are offering a new

perspective, one that focuses on the behaviours of the leaders as opposed to their mental,

physical or social characteristics. Thus, with the evolutions in psychometrics, notably the factor

analysis, researchers were able to measure the cause an effects relationship of specific human

behaviours from leaders. From this point forward anyone with the right conditioning could have

access to the once before elite club of naturally gifted leaders. In other words, leaders are made

not born.

The behavioural theories first divided leaders in two categories. Those that were concerned with

the tasks and those concerned with the people. Throughout the literature these are referred to

as different names, but the essence are identical.

Associated Theories

The Managerial Grid Model / Leadership Grid

Role Theory

Contingency Theories (1960's)

The Contingency Leadership theory argues that there is no single way of leading and that every

leadership style should be based on certain situations, which signifies that there are certain

people who perform at the maximum level in certain places; but at minimal performance when

taken out of their element.

To a certain extent contingency leadership theories are an extension of the trait theory, in the

sense that human traits are related to the situation in which the leaders exercise their

leadership. It is generally accepted within the contingency theories that leader are more likely to

express their leadership when they feel that their followers will be responsive.

Associated Theories

Fiedler's contingency theory

Hersey-Blanchard Situational Leadership Theory

Path-goal theory

Vroom-Yetton-Jago decision-making model of leadership

Cognitive Resource Theory

Strategic Contingencies Theory

Transactional leadership Theories (1970's)

Transactional theories, also known as exchange theories of leadership, are characterized by a

transaction made between the leader and the followers. In fact, the theory values a positive and

mutually beneficial relationship.

For the transactional theories to be effective and as a result have motivational value, the leader

must find a means to align to adequately reward (or punish) his follower, for performing leader-

assigned task. In other words, transactional leaders are most efficient when they develop a

mutual reinforcing environment, for which the individual and the organizational goals are in

sync.

The transactional theorists state that humans in general are seeking to maximize pleasurable

experiences and to diminish un-pleasurable experiences. Thus, we are more likely to associate

ourselves with individuals that add to our strengths.

Transformational Leadership Theories (1970s)

The Transformational Leadership theory states that this process is by which a person interacts

with others and is able to create a solid relationship that results in a high percentage of trust,

that will later result in an increase of motivation, both intrinsic and extrinsic, in both leaders and

followers.

The essence of transformational theories is that leaders transform their followers through their

inspirational nature and charismatic personalities. Rules and regulations are flexible, guided by

group norms. These attributes provide a sense of belonging for the followers as they can easily

identify with the leader and its purpose.

Management theories

Management theories are implemented to help increase organizational productivity and service

quality. Not many managers use a singular theory or concept when implementing strategies in

the workplace: They commonly use a combination of a number of theories, depending on the

workplace, purpose and workforce. Contingency theory, chaos theory and systems theory are

popular management theories. Theory X and Y, which addresses management strategies for

workforce motivation, is also implemented to help increase worker productivity.

Contingency Theory

This theory asserts that managers make decisions based on the situation at hand rather than a

"one size fits all" method. A manager takes appropriate action based on aspects most important

to the current situation. Managers in a university may want to utilize a leadership approach that

includes participation from workers, while a leader in the army may want to use an autocratic

approach.

Systems Theory

Managers who understand systems theory recognize how different systems affect a worker and

how a worker affects the systems around them. A system is made up of a variety of parts that

work together to achieve a goal. Systems theory is a broad perspective that allows managers to

examine patterns and events in the workplace. This helps managers to coordinate programs to

work as a collective whole for the overall goal or mission of the organization rather than for

isolated departments.

Chaos Theory

Change is constant. Although certain events and circumstances in an organization can be

controlled, others can't. Chaos theory recognizes that change is inevitable and is rarely

controlled. While organizations grow, complexity and the possibility for susceptible events

increase. Organizations increase energy to maintain the new level of complexity, and as

organizations spend more energy, more structure is needed for stability. The system continues

to evolve and change.

Theory X and Theory Y

The management theory an individual chooses to utilize is strongly influenced by beliefs about worker attitudes. Managers who believe workers naturally lack ambition and need incentives to

increase productivity lean toward the Theory X management style. Theory Y believes that workers are naturally driven and take responsibility. While managers who believe in Theory X values often use an authoritarian style of leadership, Theory Y leaders encourage participation

from workers.

Scientific management

Classical management theory was introduced in the late 19th century. It became widespread in the first half of the 20th century, as organizations tried to address issues of industrial

management, including specialization, efficiency, higher quality, cost reduction and management-worker relationships. While other management theories have evolved since then, classical management approaches are still used today by many small-business owners to build

their companies and to succeed.

Hierarchical Structure

One of the advantages of the classical management structure is a clear organizational hierarchy with three distinct management levels. Each management group has its own objectives and

responsibilities. The top management is usually the board of directors or the chief executives who are responsible for the long-term goals of the organization. Middle management oversees the supervisors, setting department goals according to the approved budget. At the lowest level

are the supervisors who oversee day-to-day activities, address employee issues and provide employee training. The levels of leadership and responsibilities are clear and well defined. While

the three-level structure may not be suitable for all small businesses, it can benefit those that are expanding.

Division of Labor

One of the advantages of classical management approach is the division of labor. Projects are broken down into smaller tasks that are easy to complete. Employees' responsibilities and

expectations are clearly defined.

This approach allows workers to narrow their field of expertise and to specialize in one area. The division of labor approach leads to increased productivity and higher efficiency, as workers are

not expected to multitask. Small-businesses owners can benefit from taking this approach if they are looking to increase production with minimal expense.

Monetary Incentive

According to classical management theory, employees should be motivated by monetary rewards. In other words, they will work harder and become more productive if they have an

incentive to look forward to. This gives management easier control over the workforce. Employees feel appreciated when being rewarded for hard work. A small-business owner can

take this approach to motivate the employees to achieve production goals.

Autocratic Leadership

The autocratic leadership approach is the central part of classical management theory. It states that an organization should have a single leader to make decisions, to organize and direct the employees. All decisions are made at the top level and communicated down. The autocratic

leadership approach is beneficial in instances when small-business decisions need to be made quickly by a leader, without having to consult with a large group of people, such a board of

directors. Small businesses, especially sole proprietorships, can have an advantage in taking this approach, as they need a strong leader to grow.

Business performance Business performance management is a set of performance management and analytic

processes that enables the management of an organization's performance to achieve one or

more pre-selected goals. Synonyms for "business performance management"

include "corporate performance management (CPM)" and "enterprise performance

management".

Business performance management is contained within approaches to business process

management.

Business performance management has three main activities:

1. selection of goals,

2. consolidation of measurement information relevant to an organization’s progress against

these goals, and

3. interventions made by managers in light of this information with a view to improving

future performance against these goals.

Although presented here sequentially, typically all three activities will run concurrently, with

interventions by managers affecting the choice of goals, the measurement information

monitored, and the activities being undertaken by the organization.

Because business performance management activities in large organizations often involve the

collection and reporting of large volumes of data, many software vendors, particularly those

offering business intelligence tools, market products intended to assist in this process. As a

result of this marketing effort, business performance management is often incorrectly

understood as an activity that necessarily relies on software systems to work, and many

definitions of business performance management explicitly suggest software as being a definitive

component of the approach.

This interest in business performance management from the software community is sales-

driven- "The biggest growth area in operational BI analysis is in the area of business

performance management."

Since 1992, business performance management has been strongly influenced by the rise of

the balanced scorecard framework. It is common for managers to use the balanced scorecard

framework to clarify the goals of an organization, to identify how to track them, and to structure

the mechanisms by which interventions will be triggered. These steps are the same as those that

are found in BPM, and as a result balanced scorecard is often used as the basis for business

performance management activity with organizations.

In the past, owners have sought to drive strategy down and across their organizations,

transform these strategies into actionable metrics and use analytics to expose the cause-and-

effect relationships that, if understood, could give insight into decision-making.

Definition and scope

Business performance management consists of a set of management and analytic processes,

supported by technology, that enable businesses to define strategic goals and then measure and

manage performance against those goals. Core business performance management processes

include financial planning, operational planning, business modeling, consolidation and reporting,

analysis, and monitoring of key performance indicators linked to strategy.

Business performance management involves consolidation of data from various sources,

querying, and analysis of the data, and putting the results into practice.

Frameworks

Various frameworks for implementing business performance management exist. The discipline

gives companies a top-down framework by which to align planning and execution, strategy and

tactics, and business-unit and enterprise objectives. Reactions may include the Six

Sigma strategy, balanced scorecard, activity-based costing (ABC), Objectives and Key

Results (OKR), Total Quality Management, economic value-add, integrated strategic

measurement and Theory of Constraints.

Metrics and key performance indicators

Some of the areas from which bank management may gain knowledge by using business

performance management include:

customer-related numbers:

new customers acquired

status of existing customers

attrition of customers (including breakup by reason for attrition)

turnover generated by segments of the customers - possibly using demographic filters

outstanding balances held by segments of customers and terms of payment - possibly

using demographic filters

collection of bad debts within customer relationships

demographic analysis of individuals (potential customers) applying to become customers,

and the levels of approval, rejections and pending numbers

delinquency analysis of customers behind on payments

profitability of customers by demographic segments and segmentation of customers by

profitability

campaign management

real-time dashboard on key operational metrics

overall equipment effectiveness

clickstream analysis on a website

key product portfolio trackers

marketing-channel analysis

sales-data analysis by product segments

call center metrics

Though the above list describes what a bank might monitor, it could refer to a telephone

company or to a similar service-sector company.

Items of generic importance include:

1. consistent and correct KPI-related data providing insights into operational aspects of a

company

2. timely availability of KPI-related data

3. KPIs designed to directly reflect the efficiency and effectiveness of a business

4. information presented in a format which aids decision-making for management and

decision-makers

5. ability to discern patterns or trends from organized information

Business performance management integrates the company's processes with CRM or ERP.

Companies should become better able to gauge customer satisfaction, control customer trends

and influence shareholder value.

Improving Business performance

As a business owner, you are probably aware of where your business could improve. Sometimes

business owners want to improve their business, but are not sure how to begin.

This is an overview of some key steps you can take to start improving your business.

Assess your situation

Before you start making changes, it's a good idea to make sure you have a full understanding of

the factors affecting your business success.

These may include your current business practices, market trends or changes to the wider

environment in which you operate.

Tools which can help you assess your business's situation include:

SWOT analysis - helps you identify your business's strengths, weaknesses, opportunities

and threats.

Benchmarking - measures your business's performance against similar-sized businesses in

your industry.

Market research - investigates your business's market and industry to identify trends,

changes and customer or client demands.

Trend analysis - uses business data collected over time to identify consistent results or

trends.

Webinars (web-based seminars) provide useful information to help develop your business

skills.

Set clear goals

Business goals can be as broad or as specific as you want them to be. Writing down your goals

clearly will make it easier for you to achieve them. Make sure your goals are:

specific - state clearly what you want to achieve

measurable - make sure you can evaluate success

achievable - check your objective is something you have the time and resources to meet

relevant - make sure your objectives improve profit drivers and improve some part of

your business

timely - set a specific date for completion.

Once you have written down your goals, you should prioritise them to decide which ones to

focus on first.

Some goals may need be more urgent than others. It's also important to recognise that some

goals will need to be addressed with a long-term strategy as you won't be able to meet them

immediately, because of resources, finances or time.

Identify strategies for achieving your goals

Review your goals and list the factors you think are creating your current circumstances. Think

about what strategy you could use to improve the situation.

Depending on the goals you're trying to meet, you may want to think about using the services of

a business professional, such as a professional trainer, a contractor or a business adviser.

Think realistically about what you can do yourself and where you may benefit from some

support.

Develop a plan for implementing your strategies

To achieve your goals, you need to work out how to implement your strategies. Strategies often

include several specific actions or tasks. It's a good idea to develop a plan for how you will do

this.

Write your plan in a format that suits you. It should include:

a time frame - how long a task will take to complete as well as start and finish dates

actions - state the individual actions as precisely as you can

responsibilities - assign accountability for each action so everyone knows precisely what

you expect of them and who is responsible for ensuring the work is done

resources - list budget, staff or supplies needed to complete each action

a desired outcome - state how you will know that the action has been completed.

When you've developed your plan, you might want to also update your overall business plan.

Measure the results

Establishing how you will measure the results that you want to achieve may be as simple as

checking you've completed an activity.

With larger goals, you may have to establish a more complex measurement process, like

increasing profit by a set percentage, or gaining a particular number of new clients. With these

types of goals, it can also be useful to set points to measure their success as you're working on

them. This will help you keep your plan on track.

Consider how often you want to measure your business achievements. This can also help you set

new goals regularly.

Stakeholder engagement

Stakeholder engagement is the process by which an organisation involves people who may be

affected by the decisions it makes, or can influence the implementation of its decisions. They

may support or oppose the decisions, be influential in the organization or within the community

in which it operates, hold relevant official positions or be affected in the long term.

Stakeholder engagement is a key part of corporate social responsibility (CSR) and achieving

the triple bottom line. Companies engage their stakeholders in dialogue to find out what social

and environmental issues matter most to them about their performance in order to improve

decision-making and accountability. Engaging stakeholders is a requirement of the Global

Reporting Initiative, a network-based organisation with sustainability reporting framework that is

widely used around the world. The International Organisation for Standardization (ISO) requires

stakeholder engagement for all their new standards.

Involving stakeholders in decision-making processes is not confined to corporate social

responsibility (CSR) processes. It's a tool used by mature private and public sector

organisations, especially when they want to develop understanding and agree to solutions on

complex issues or issues of concern.

An underlying principle of stakeholder engagement is that stakeholders have the chance to

influence the decision-making process. This differentiates stakeholder engagement from

communications processes that seek to issue a message or influence groups to agree with a

decision that is already made. The UK organization The Environment Council developed the

Principles of Authentic Engagement. These are intended to provide a framework for genuine

stakeholder engagement.

Jeffrey (2009) in "Stakeholder Engagement: A Road map to meaningful engagement" describes

seven core values for the practices of gaining meaningful participation of which perhaps the

three most critical are:

Stakeholders should have a say in decisions about actions that could affect their lives or

essential environment for life.

Stakeholder participation includes the promise that stakeholders's contribution will

influence the decision

Stakeholder participation seeks input from participants in designing how they participate.

The practitioners in stakeholder engagement are often businesses, non-governmental

organizations (NGOs), labor organizations, trade and industry organizations, governments,

and financial institutions.

Components

Partnerships, in the context of corporate social responsibility interactions, are people and

organizations from some combination of public, business and civil constituencies who engage in

common societal aims through combining their resources and competencies, sharing both risks

and benefits.

Agreeing on the rules of engagement is integral to the process. It is important for everyone to

understand each party's role.

Buy-in is essential for success in stakeholder engagement. Every party must have a stake in the

process and have participating members have decision-making power. Every party must be

committed to the process by ensuring action based on the decisions made through the

engagement.

No decisions should be already made before commencing stakeholder engagement on the issue.

It is integral that the dialogue has legitimacy in influencing the decision.

Benefits

Stakeholder engagement provides opportunities to further align business practices with societal

needs and expectations, helping to drive long-term sustainability and shareholder value.

Stakeholder engagement is intended to help the practitioners fully realize the benefits of

stakeholder engagement in their organization, to compete in an increasingly complex and ever-

changing business environment, while at the same time bringing about systemic change towards

sustainable development.

2. Understand leadership styles

Leadership and management styles Management is not an unstructured exercise based on intuition. Effective managers undertake

specific functions, which when carried out increase a firm's profitability. Managers must have the

ability to influence employees toward goal achievement, so the leadership style a manager

adopts can affect his success. Successful managers are most often persuasive leaders.

Planning

Planning entails the setting of goals and includes the creation of a blueprint to achieve them. It

is essential that managers create objectives, which serve to focus the efforts of employees,

motivate them and provide a standard against which performance can be measured. Plans also

serve as a guide to action and assist managers in resource allocation. For example, if growth is

an objective, a budget may include funds for expansion of facilities.

Organizing

Another important managerial function is organizing, which can be defined as the allocation of

resources to achieve goals. It is clear that this function relates to the planning function, as goals

must be set before organizational resources can be deployed to assist in the achievement of

them. An important component of organizing is the defining of the chain of command and the

utilization of human resources.

Leading

Without the ability to influence subordinates toward goal achievement, a manger cannot be

effective. No matter how well-crafted the objectives or how well-organized the resources,

nothing can be achieved if employees are unwilling or unable to work toward the objectives.

Managers who lack the ability to influence subordinates are often ineffective and find it difficult

to motivate their workers to increase productivity.

Controlling

Control can be defined as a methodical process through which managers monitor employees and

their activities to ensure that they are in alignment with the company's objectives. Control is an

extremely important management function, as without it organizational activities would go

unchecked, leading to inefficiencies and unfulfilled targets. The control exercise allows managers

to take corrective action and contains an element of feedback so that there can be continuous

improvement.

Leadership Styles

Leadership is critical to a company's profitability. The methods and manner that a manager uses

to spur workers toward the achievement of the company's objectives is termed leadership style.

There are four main leadership styles: autocratic, democratic, paternalistic and laissez faire. A

manager may have a prevailing style or may change his style depending on the situation. This is

known as situational leadership.

Autocratic vs. Democratic Leadership

Autocratic leaders control the decision-making entirely and express no interest in the

suggestions of employees. This leadership style is useful in situations that demand speedy

decision-making and when information is confidential, but it may demoralize employees and

result in less creative decision-making. Democratic leaders seek the input of employees in

decision-making. This style motivates employees, but it may be time-consuming because of the

ongoing consultations.

Paternalistic Leadership

A paternalistic leader, as the name suggests, adopts a father-like approach. This style is a hybrid

of the democratic and autocratic styles. Paternalistic leaders may allow employee input, but they

ultimately make the final decision based on what they think is best. The solicitation of feedback

can improve morale, but this may be only temporary if employees realize that none of their

suggestions are being implemented.

Laissez Faire Leadership

Laissez faire means allowing persons to do as they please. Managers that adopt this style give

their employees significant freedom and autonomy. A leader with this style provides very little

guidance to his subordinates. Laissez faire leadership is effective when employees are highly

skilled or are experts in their field and require little supervision. However, researchers Lewin,

Lippit and White found that this style ultimately resulted in lowered productivity, less cohesion

and reduced job satisfaction.

Emotional Leadership Styles

Think for a moment about the best boss that you ever had. What was it that made working with

him or her so rewarding?

Maybe he was happy and excited about his work, and that made you feel happy and excited,

too. He never got angry when problems came up, but instead focused on finding workable

solutions. He was confident, but always ready to hear other people's opinions. As a result, you

enjoyed your job and consistently performed well.

Now think about the worst boss you ever had: the one who was ill-tempered, made unrealistic

demands without telling you why, and was always "pulling rank." Sure, you worked hard, but

only because you were afraid not to. She got results in the short term, but her team members

soon burned out and staff churn was high.

The contrast between the two examples of managers is stark. It is also significant.

Scientific research shows that a leader's emotional state can impact everyone in an organization.

The leader's mood can cause a chain reaction that affects not only morale but also productivity

and the bottom line.

So, as a leader, developing a higher level of emotional intelligence (EI) – your ability to manage

your own emotions and to read other people's – is an important business skill.

There are six "emotional leadership styles" that are useful in different circumstances. In this

article, we'll explore each of them, and look at how you can develop the skills you need to use

each one effectively. (Mind Tools Club members can also read examples of how each style

works in practice.)

The Six Emotional Leadership Styles

Daniel Goleman, Richard Boyatzis, and Annie McKee identified six emotional leadership styles in

their 2002 book, "Primal Leadership." Each style has a different effect on people's emotions, and

each has strengths and weaknesses in different situations.

Four of these styles (Visionary, Coaching, Affiliative, and Democratic) promote harmony and

positive outcomes. However, the other two (Commanding and Pacesetting) may create tension

and you should only use them in specific circumstances.

Goleman and his co-authors say that you shouldn't use any one style all the time. Instead, use

the six styles interchangeably – choose the one that best addresses the situation that you're

facing, the people concerned, and the emotions that they're experiencing.

Tip:

Learning how to "read" a situation and the feelings of the people involved will help you to select

the appropriate leadership style. Our articles on listening skills and body language are a good

starting point.

Now, let's examine each style in more detail.

1. The Visionary Leader

The Visionary approach to leadership is summed up by the phrase, "Come with me."

Visionary leaders are inspiring. They tell their teams where they're heading, but don't dictate

how they're going to get there – they encourage their team members to use their

own initiative to solve a problem or to meet a target. Empathy is the most important aspect of

Visionary leadership.

When to Use It

Visionary leadership is most effective when your organization needs a new vision or a dramatic

new direction, or for helping your team to manage change. However, it's less likely to be

effective when you're working with a team that's more experienced than you are. In these cases,

democratic leadership is more likely to be effective.

Visionary leadership can create the most positive results of all the six leadership styles, but it

may also be overbearing if you use it too much.

How to Develop It

To develop a Visionary leadership style focus on increasing your expertise, vision, self-

confidence, and empathy. Get excited about change, and let your team see your enthusiasm –

remember, it's infectious!

You also need to convince others of your vision, so focus on improving

your communication and presentation skills.

2. The Coaching Leader

The Coaching leader's approach is, "Try this."

The Coaching leadership style connects a team member's personal goals and values with the

organization's goals. This style is empathic and encouraging, and you can use it when you want

to focus on developing people for future success.

This style centers on having in-depth conversations that may have little to do with people's

current work, instead focusing on long-term life plans and how these connect with the

organization's mission.

This style has a positive impact. It establishes rapport and trust, and increases motivation.

When to Use It

Use the Coaching style when you have a team member who needs help building long-term skills,

or if you feel that he is "adrift" in your organization and could benefit from a coaching or

mentoring relationship.

However, coaching can fail when it's used with an employee who is not making an effort, or who

needs a lot of direction and feedback. In these cases, Pacesetting or Commanding leadership

may be more effective.

How to Develop It

To develop a Coaching style, learn how to engage in informal coaching and mentoring.

It's also important to get to know the people on your team. When you know your people, you're

better able to see when they need guidance or advice. Use Management by Wandering

Around to keep in touch with their needs.

3. The Affiliative Leader

The Affiliative leader believes that, "People come first."

The Affiliative leadership style promotes harmony within the team, and emphasizes emotional

connections. It connects people by encouraging inclusion and resolving conflict. To use this style

you need to value other's emotions and have a strong awareness of their emotional needs.

When to Use It

Use this style whenever there is team tension or conflict, when trust has been broken, or if the

team needs to be motivated through a stressful time.

How to Develop It

Leaders who use the Affiliate style are highly focused on emotion. So, learn how to resolve

conflict and how to be optimistic. Our article on managing emotion in your team will also help.

4. The Democratic Leader

The Democratic Leader asks, "What do you think?"

The Democratic leadership style focuses on collaboration. Leaders using this leadership style

actively seek input from their teams, and they rely more on listening than directing.

When to Use It

This style is best used when you need to get your team on board with an idea or build

consensus. It's also effective when you need your team's input.

The Democratic leadership style shouldn't be used with people who are inexperienced, lack

competence, or aren't well informed about a situation. It's best to ask for input from team

members who are motivated, knowledgeable and capable.

How to Develop It

To develop a Democratic leadership style, involve your team in problem solving and decision

making, and teach them the skills that they need to do this. Also try to improve your active

listening and facilitation skills.

5. The Pacesetting Leader

The Pacesetting leader says, "Do as I do, now."

The Pacesetting leadership style focuses on performance and achieving goals. Pacesetting

leaders expect excellence from their teams, and they will often jump in themselves to make sure

that targets are met.

This style doesn't "coddle" poor performers – everyone is held to a high standard.

While this can be a successful style, it can have a negative effect on the team, leading to

burnout, exhaustion and high staff turnover.

When to Use It

Try the Pacesetting leadership style when you need to get high-quality results from a motivated

team, quickly.

How to Develop It

Because the Pacesetting style focuses on high performance, learn how to improve the quality of

your team's work using techniques such as Six Sigma and Kaizen. Train your people well and

engage in high-performance coaching to help them to become as effective as possible.

You may also want to work on your motivation skills, so that you can get the best from your

people.

6. The Commanding Leader

The Commanding Leader demands, "Do what I tell you."

Commanding leaders use an autocratic approach. This often depends on orders, the (often

unspoken) threat of disciplinary action, and tight control.

So, it's important to remember that people in democratic countries are used to having a high

level of control over their lives and their work, and that this approach could deprives them of

this. What's more, because this leadership style is so often misused, it can have a profoundly

negative effect on a team.

When to Use It

The Commanding leadership style is best used in crises to jump-start fast-paced change and

with problem employees.

How to Develop It

Be cautious when setting out to develop a Commanding leadership style. Remember, this style is

very easily misused, and it should only be used when absolutely necessary.

To work effectively in these high-pressure situations, learn how to manage a crisis, think on your

feet, and make good decisions under pressure.

Adaptive management

Adaptive management (AM), also known as adaptive resource management (ARM) or adaptive

environmental assessment and management (AEAM), is a structured, iterative process of

robust decision making in the face of uncertainty, with an aim to reducing uncertainty over time

via system monitoring. In this way, decision making simultaneously meets one or more resource

management objectives and, either passively or actively, accrues information needed to improve

future management. Adaptive management is a tool which should be used not only to change a

system, but also to learn about the system. Because adaptive management is based on a

learning process, it improves long-run management outcomes. The challenge in using the

adaptive management approach lies in finding the correct balance between gaining knowledge to

improve management in the future and achieving the best short-term outcome based on current

knowledge. This approach has more recently been employed in implementing international

development programs.

Objectives

There are a number of scientific and social processes which are vital components of adaptive

management, including:

Management is linked to appropriate temporal and spatial scales

Management retains a focus on statistical power and controls

Use of computer models to build synthesis and an embodied ecological consensus

Use of embodied ecological consensus to evaluate strategic alternatives

Communication of alternatives to political arena for negotiation of a selection

Use of decision support system in controlled environment agriculture.

The achievement of these objectives requires an open management process which seeks to

include past, present and future stakeholders. Adaptive management needs to at least

maintain political openness, but usually aims to create it. Adaptive management must therefore

be a scientific and social process. It must focus on the development of new institutions and

institutional strategies in balance with scientific hypothesis and experimental frameworks

(resilliance.org).

Adaptive management can proceed as either passive or active adaptive management, depending

on how learning takes place. Passive adaptive management values learning only insofar as it

improves decision outcomes (i.e. passively), as measured by the specified utility function. In

contrast, active adaptive management explicitly incorporates learning as part of the objective

function, and hence, decisions which improve learning are valued over those which do not. In

both cases, as new knowledge is gained, the models are updated and optimal management

strategies are derived accordingly. Thus, while learning occurs in both cases, it is treated

differently. Often, deriving actively adaptive policies is technically very difficult, which prevents it

being more commonly applied.

Features

Key features of both passive and active adaptive management are:

Iterative decision-making (evaluating results and adjusting actions on the basis of what

has been learned)

Feedback between monitoring and decisions (learning)

Explicit characterization of system uncertainty through multi-model inference

Bayesian inference

Embracing risk and uncertainty as a way of building understanding

However, a number of process failures related to information feedback can prevent effective

adaptive management decision making:

data collection is never completely implemented

data are collected but not analyzed

data are analyzed but results are inconclusive

data are analyzed and are interesting, but are not presented to decision makers

data are analyzed and presented, but are not used for decision-making because of

internal or external factors

Application to environmental projects and programs

Figure 1: CMP Adaptive Management Cycle

Open Standards for the Practice of Conservation lays out five main steps to an adaptive

management project cycle (see Figure 1). The Open Standards represent a compilation and

adaptation of best practices and guidelines across several fields and across several organizations

within the conservation community. Since the release of the initial Open Standards (updated in

2007 and 2013), thousands of project teams from conservation organizations (e.g., TNC, Rare,

and WWF), local conservation groups, and donors alike have begun applying these Open

Standards to their work. In addition, several CMP members have developed training materials

and courses to help apply the Standards.

Some recent write-ups of adaptive management in conservation include: wildlife protection

(SWAP, 2008), forests ecosystem protection (CMER, 2010), coastal protection and restoration

(LACPR, 2009), natural resource management (water, land and soil), species conservation

especially, fish conservation from overfishing (FOS, 2007) and climate change (DFG, 2010). In

addition, some other examples follow:

In 2006–2007, FOS worked with The National Fish and Wildlife Foundation (NFWF) to

develop an evaluation system help NFWF gauge impact across the various coral reef

habitat and species conservation projects;

In 2007, FOS worked with the Ocean Conservancy (OC) to evaluate the effectiveness of

this Scorecard in helping to end overfishing in domestic fisheries.

Between 1999–2004, FOS worked for WWF's Asian Rhino and Elephant Action Strategy

(AREAS) Program to ensure that Asian elephants and rhinos thrive in secure habitats

within their historical range and in harmony with people.

The Department of Fish and Game (DFG) is developing and implementing adaptation

strategies to help protect, restore and manage fish and wildlife, with the understanding

that some level of climate change will occur and that it will have profound effects on

ecosystems in the United States.

The Adaptive Management program was created by CMR to provide science-based

recommendations and technical information to assist the Forest Practices Board. In April

2010, the Forest Practices Adaptive Management Annual Science Conference was held in

Washington.

In 2009, The Louisiana Coastal Protection and Restoration (LACPR) Technical Report has

been developed by the United States Army Corps of Engineers (USACE) according to

adaptive management process.

Since 2009, the Kenya Wildlife Service has been managing its marine protected areas

using adaptive management in an ongoing process of learning through the Science for

Active Management (SAM) Program.

Tools and guidance for conservation practitioners

The following resources offer guidance on designing and planning conservation projects (Steps 1

and 2 of the Open Standards), as well as more general guidance on the adaptive management

process.

Step 1: Conceptualize (describing the project's context)

IUCN-CMP Unified Classifications of Direct Threats and Conservation Actions: A

standardized taxonomy of direct threats to biodiversity and conservation actions that

helps conservation teams speak a common language across projects to facilitate learning.

Using Conceptual Models to Document a Situation Analysis: A guide that explains how to

build a conceptual model to clearly portray what drives threats to biodiversity within a

project site.

Instruction Manual for completing Step 1 of the WWF Standards – Define: An online

course manual to walk users through the conceptualization phase of the adaptive

management project cycle.

Step 2: Plan actions and monitoring

Using Results Chains to Improve Strategy Effectiveness: A guide that explains how to

build results chains – a tool for clarifying a project team's assumptions about how their

actions will contribute to reducing threats and conserving biodiversity.

Instruction Manual for completing Step 2 of the WWF Standards – Design: An online

course manual used by WWF's Online Campus to walk users through the actions and

monitoring plan phase of the adaptive management project cycle.

In international development

The concept of adaptive management is not restricted to natural resources or ecosystem management, as similar concepts have been applied to international development programming.

This has often been a recognition to the "wicked" nature of many development challenges and the limits of traditional planning processes. One of the principal changes facing international

development organizations is the need to be more flexible, adaptable and focused on learning. This is reflected in international development approaches such as Doing Development Differently, Politically Informed Programming and Problem Driven Iterative Adaptation.

One recent example of the use of adaptive management by international development donors is

the planned Global Learning for Adaptive Management (GLAM) program to support adaptive management in Department for International Development and USAID. The program is

establishing a center for learning about adaptive management to support the utilization and accessibility of adaptive management. In addition, donors have been focused on amending their own programmatic guidance to reflect the importance of learning within programs: for instance,

USAID's recent focus in their ADS guidance on the importance of collaborating, learning and adapting. This is also reflected in Department for International Development's Smart Rules that

provide the operating framework for their programs including the use of evidence to inform their decisions. There are a variety of tools used to operationalize adaptive management in programs, such as learning agendas.

Collaborating, learning and adapting (CLA) is a concept related to the operationalizing of

adaptive management in international development that describes a specific way of designing,

implementing, adapting and evaluating programs. CLA involves three concepts:

1. Collaborating intentionally with stakeholders to share knowledge and reduce duplication of effort,

2. Learning systematically by drawing on evidence from a variety of sources and taking the

time to reflect on implementation, and

3. Adapting strategically based on applied learning. CLA practices have tangible benefits; for instance, a recent study recently found that companies "which apply more data-driven

and adaptive leadership practices perform better" when examined against those which focus less on those practices.[38] Col

CLA integrates three closely connected concepts within the organizational theory literature:

namely collaborating, learning and adapting. There is evidence of the benefits of collaborating internally within an organization and externally with organizations. Much of the production and transmission of knowledge—both explicit knowledge and tacit knowledge—occurs through

collaboration. There is evidence for the importance of collaboration among individuals and groups for innovation, knowledge production, and diffusion—for example, the benefits of staff

interacting with one another and transmitting knowledge. The importance of collaboration is closely linked to the ability of organizations to collectively learn from each other, a concept noted in the literature on learning organizations.

CLA, an adaptive management practice, is being employed by implementing partners that

receive funding from the federal government of the United States, but it is primarily a framework for internal change efforts that aim at incorporating collaboration, learning, and

adaptation within the United States Agency for International Development (USAID) including its missions located around the world. CLA has been linked to a part of USAID's commitment to becoming a learning organization. CLA represents an approach to combine strategic

collaboration, continuous learning, and adaptive management. A part of integrating the CLA approach is providing tools and resources, such as the Learning Lab, to staff and partner

organizations. The CLA approach is detailed for USAID staff in the recently revised program policy guidance.

Ethical dimensions Ethical people are those who recognize the difference between right and wrong and consistently

strive to set an example of good conduct. In a business setting, being ethical means applying

principles of honesty and fairness to relationships with coworkers and customers. Ethical

individuals make an effort to treat everyone with whom they come in contact as they would

want to be treated themselves.

Build Customer Loyalty

Consumers may let a company take advantage of them once, but if they believe they have been

treated unfairly, such as by being overcharged, they will not be repeat customers. Having a loyal

customer base is one of the keys to long-range business success because serving an existing

customer doesn’t involve marketing cost, as does acquiring a new one. A company’s reputation

for ethical behavior can help it create a more positive image in the marketplace, which can bring

in new customers through word-of-mouth referrals. Conversely, a reputation for unethical

dealings hurts the company’s chances to obtain new customers, particularly in this age of social

networking when dissatisfied customers can quickly disseminate information about the negative

experience they had.

Retain Good Employees

Talented individuals at all levels of an organization want to be compensated fairly for their work

and dedication. They want career advancement within the organization to be based on the

quality of the work they do and not on favoritism. They want to be part of a company whose

management team tells them the truth about what is going on, such as when layoffs or

reorganizations are being contemplated. Companies who are fair and open in their dealings with

employees have a better chance of retaining the most talented people. Employees who do not

believe the compensation methodology is fair are often not as dedicated to their jobs as they

could be.

Positive Work Environment

Employees have a responsibility to be ethical from the moment they have their first job

interview. They must be honest about their capabilities and experience. Ethical employees are

perceived as team players rather than as individuals just out for themselves. They develop

positive relationships with coworkers. Their supervisors trust them with confidential information

and they are often given more autonomy as a result. Employees who are caught in lies by their

supervisors damage their chances of advancement within the organization and may risk being

fired. An extreme case of poor ethics is employee theft. In some industries, this can cost the

business a significant amount of money, such as restaurants whose employees steal food from

the storage locker or freezer.

Avoid Legal Problems

At times, a company’s management may be tempted to cut corners in pursuit of profit, such as

not fully complying with environmental regulations or labor laws, ignoring worker safety hazards

or using substandard materials in their products. The penalties for being caught can be severe,

including legal fees and fines or sanctions by governmental agencies. The resulting negative

publicity can cause long-range damage to the company’s reputation that is even more costly

than the legal fees or fines. Companies that maintain the highest ethical standards take the time

to train every member of the organization about the conduct that is expected of them.

3. Understand motivation and empowerment

Motivation Motivation is the word derived from the word ’motive’ which means needs, desires, wants or

drives within the individuals. It is the process of stimulating people to actions to accomplish the

goals. In the work goal context the psychological factors stimulating the people’s behaviour can

be -

desire for money

success

recognition

job-satisfaction

team work, etc

One of the most important functions of management is to create willingness amongst the

employees to perform in the best of their abilities. Therefore the role of a leader is to arouse

interest in performance of employees in their jobs. The process of motivation consists of three

stages:-

1. A felt need or drive

2. A stimulus in which needs have to be aroused

3. When needs are satisfied, the satisfaction or accomplishment of goals.

Therefore, we can say that motivation is a psychological phenomenon which means needs and

wants of the individuals have to be tackled by framing an incentive plan.

How Great Managers Motivate Their Employees

What can managers do to motivate employees? The reality, when you talk about how to

motivate employees, is that employees are motivated. The manager's challenge is to figure out

how to tap into that motivation to accomplish work goals. Fortunately, the manager controls the

key environmental factors necessary to motivate employees.

The most significant factor, that the manager controls, is his or her relationship with each

employee. The second most important factor in a manager's ability to motivate employees is

creating a work environment and organizational culture that fosters employee motivation and

engagement.

This work culture consists of an environment in which employees are trusted, treated like the

adults they are, and not micromanaged. Employees are entrusted with the values, vision,

mission, and strategic framework within which they are expected to accomplish their jobs.

They receive frequent communication, are treated with respect and civility, and have input to

every facet of the work they are hired to produce. These are factors that help produce an

environment in which employees will choose motivation to accomplish the requirements of their

work.

Here are additional thoughts about how managers can motivate employees.

01 7 Ways Managers Can Motivate Employees—Today

No matter what kind of work environment and culture your organization provides to support

your ability to motivate employees, you can directly affect employee motivation. You can create

an environment that will motivate employees.

You can take actions every day that will increase employee satisfaction. These are seven key

actions you can take to motivate employees—today.

02 Management Matters Most in Motivation

Motivation is the most powerful emotion that employees bring to work each day. The manager's

commitment to motivating employees through shared vision and communication is the

fundamental skill that great managers bring to the workplace.

Employees in management roles can learn to inspire and motivate employees. Here is why the

skill and wisdom of managers matters most in employee motivation.

03 You Can Make Their Day: 10 Tips for the Leader about Motivation

As their manager, you can make their day or break their day. Your choice. No kidding. The

manager is the most powerful factor in motivating employees.

As a manager or supervisor, your impact on employee motivation, by how you motivate

employees, is immeasurable. Learn more about how you can make your employees' day.

04 It's All About the Managers...Duh!

The keys to financial success and a profitable business are not the strategies of management or

the systems of the firm. The character and skill of individual managers, who practice what they

preach and recognize the manager's role in coaching and to motivate employees are what count.

The manager can still operate a profitable business when his or her employees are motivated to

contribute - likely even more so. Learn more about how the manager can motivate employees

while operating a profitable business.

05 Leadership Inspires Motivation

Want to spend your time in leadership activities that inspire employee motivation, trust, and

certainty while dispelling employee fear, negativity, and skepticism? During times of change, no

actions are more powerful than when managers make the time to communicate and build

relationships with their employees.

When managers share the vision, optimism, and purpose-driven goals, how to motivate

employees and gain their commitment becomes easy. Find out more about how to inspire and

motivate your employees. Your leadership relationship with them is your most significant tool.

06 The Bottom Line for Motivating Employees: 10 Tips

Employee motivation is a description of an employee’s intrinsic enthusiasm about and drive to

accomplish work. Every employee is motivated about something in his or her life. How a

manager can tap into the intrinsic motivation that an employee brings to work is a combination

of fulfilling the employee's needs and expectations from work.

The manager must affect the workplace factors that enable him or her to motivate employees -

or not. Here are ten tips about employee motivation and creating a work environment that is

motivating for employees.

07 Foster Success for People: 2 Musts to Motivate Employees

Are you tired of hearing that people are your most important resource? Being told that people

are your most important resource? That's fair. These buzz words have been overused and

abused in the board room—forever.

People have heard these words so often, in situations where actions belie their meaning that

they have grown cynical. So, I propose a better statement of belief. People are your only

resource. If you get this, you will create a work environment to engage, motivate, and retain

employees.

08 How to Demonstrate Respect at Work

Employees want respect from their manager. In fact, treating employees with dignity and

respect tops the list of factors that enable managers to motivate employees.

The relationship between an employee and his or her manager is a key factor in employee

motivation, engagement, and retention. You can motivate employees by treating them with

respect. Here's how to demonstrate respect while you motivate employees in your workplace.

09 Top 10 Ways to Show Appreciation

If you tell your reporting employees that you value them and their contribution, you are on the

right path to motivate employees. Employees appreciate your positive recognition in any form.

In fact, make sure that the majority of your interactions with employees are positive and

appreciative.

Then, when you need to suggest improvement or correct performance or behavior, you do so in

an environment of openness and acceptance. The employee is more likely to change, and you

achieve your goal to motivate employees.

10 Provide Motivational Employee Recognition

You can avoid the employee recognition traps that: single out one or a few employees who are

mysteriously selected for the recognition; sap the morale of the many who failed to win, place,

or even show; confuse people who meet the criteria yet were not selected; or sought votes or

other personalized, subjective criteria to determine winners.

Job Satisfaction

Job satisfaction or employee satisfaction has been defined in many different ways. Some believe it is simply how content an individual is with his or her job, in other words, whether or

not they like the job or individual aspects or facets of jobs, such as nature of work or supervision. Others believe it is not as simplistic as this definition suggests and instead that multidimensional psychological responses to one's job are involved. Researchers have also noted

that job satisfaction measures vary in the extent to which they measure feelings about the job (affective job satisfaction) or cognitions about the job (cognitive job satisfaction).

Definitional issues

The concept of job satisfaction has been developed in many ways by many different researchers

and practitioners. One of the most widely used definitions in organizational research is that of

Locke (1976), who defines job satisfaction as "a pleasurable or positive emotional state resulting

from the appraisal of one's job or job experiences" (p. 1304). Others have defined it as simply

how content an individual is with his or her job; whether he or she likes the job or not. It is

assessed at both the global level (whether or not the individual is satisfied with the job overall),

or at the facet level (whether or not the individual is satisfied with different aspects of the

job). Spector (1997) lists 14 common facets: Appreciation, Communication, Coworkers, Fringe

benefits, Job conditions, Nature of the work, Organization, Personal growth, Policies and

procedures, Promotion opportunities, Recognition, Security, and Supervision.

A more recent definition of the concept of job satisfaction is from Hulin and Judge (2003), who

have noted that job satisfaction includes multidimensional psychological responses to an individual's job, and that these personal responses have cognitive (evaluative), affective (or emotional), and behavioral components. Job satisfaction scales vary in the extent to which they

assess the affective feelings about the job or the cognitive assessment of the job. Affective job satisfaction is a subjective construct representing an emotional feeling individuals have about

their job. Hence, affective job satisfaction for individuals reflects the degree of pleasure or happiness their job in general induces. Cognitive job satisfaction is a more objective and logical evaluation of various facets of a job. Cognitive job satisfaction can be one-dimensional if it

comprises evaluation of just one facet of a job, such as pay or maternity leave, or multidimensional if two or more facets of a job are simultaneously evaluated. Cognitive job

satisfaction does not assess the degree of pleasure or happiness that arises from specific job facets, but rather gauges the extent to which those job facets are judged by the job holder to be satisfactory in comparison with objectives they themselves set or with other jobs. While

cognitive job satisfaction might help to bring about affective job satisfaction, the two constructs are distinct, not necessarily directly related, and have different antecedents and consequences.

Job satisfaction can also be seen within the broader context of the range of issues which affect

an individual's experience of work, or their quality of working life. Job satisfaction can be

understood in terms of its relationships with other key factors, such as general well-being, stress

at work, control at work, home-work interface, and working conditions.

A study title "Analysis of Factors Affecting Job Satisfaction of the Employees in Public and Private

Sector", in India concluded that in India Employees tend to love their job if they get what they

believe is an important attribute of a good job. Weightage factor of each such attribute based on

exhaustive survey has been calculated. Region, sector and gender wise study of job satisfaction

has provided consistent picture with respect to distribution of data set analyzed showed that

most of the employees in Indian industry are not satisfied with their job except for a few like

male in commerce sector and female in education sector. Total job satisfaction level of males is

found to be higher than that of woman. Total job satisfaction level in manufacturing sector is

found to be very low.

Affect theory

Edwin A. Locke’s Range of Affect Theory (1976) is arguably the most famous job satisfaction

model. The main premise of this theory is that satisfaction is determined by a discrepancy

between what one wants in a job and what one has in a job. Further, the theory states that how

much one values a given facet of work (e.g. the degree of autonomy in a position) moderates

how satisfied/dissatisfied one becomes when expectations are/aren’t met. When a person values

a particular facet of a job, his satisfaction is more greatly impacted both positively (when

expectations are met) and negatively (when expectations are not met), compared to one who

doesn’t value that facet. To illustrate, if Employee A values autonomy in the workplace and

Employee B is indifferent about autonomy, then Employee A would be more satisfied in a

position that offers a high degree of autonomy and less satisfied in a position with little or no

autonomy compared to Employee B. This theory also states that too much of a particular facet

will produce stronger feelings of dissatisfaction the more a worker values that facet.

Dispositional approach

The dispositional approach suggests that individuals vary in their tendency to be satisfied with

their jobs, in other words, job satisfaction is to some extent an individual trait. This approach

became a notable explanation of job satisfaction in light of evidence that job satisfaction tends

to be stable over time and across careers and jobs. Research also indicates that identical twins

raised apart have similar levels of job satisfaction.

A significant model that narrowed the scope of the dispositional approach was the Core Self-

evaluations Model, proposed by Timothy A. Judge, Edwin A. Locke, and Cathy C. Durham in

1997. Judge et al. argued that there are four Core Self-evaluations that determine one’s

disposition towards job satisfaction: self-esteem, general self-efficacy, locus of control,

and neuroticism. This model states that higher levels of self-esteem (the value one places on

his/her self) and general self-efficacy (the belief in one’s own competence) lead to higher work

satisfaction. Having an internal locus of control (believing one has control over her\his own life,

as opposed to outside forces having control) leads to higher job satisfaction. Finally, lower levels

of neuroticism lead to higher job satisfaction.

Equity theory

Equity Theory shows how a person views fairness in regard to social relationships such as with

an employer. A person identifies the amount of input (things gained) from a relationship

compared to the output (things given) to produce an input/output ratio. They then compare this

ratio to the ratio of other people in deciding whether or not they have an equitable relationship.

Equity Theory suggests that if an individual thinks there is an inequality between two social

groups or individuals, the person is likely to be distressed because the ratio between the input

and the output are not equal.

For example, consider two employees who work the same job and receive the same pay and

benefits. If one individual gets a pay raise for doing the same work as the other, then the less

benefited individual will become distressed in his workplace. If, on the other hand, both

individuals get pay raises and new responsibilities, then the feeling of equity will be maintained.

Other psychologists have extended the equity theory, suggesting three behavioral response

patterns to situations of perceived equity or inequity (Huseman, Hatfield, & Mile, 1987; O'Neil &

Mone 1998). These three types are benevolent, equity sensitive, and entitled. The level by each

type affects motivation, job satisfaction, and job performance.

1. Benevolent-Satisfied when they are under-rewarded compared with co-workers

2. Equity sensitive-Believe everyone should be fairly rewarded

3. Entitled-People believe that everything they receive is their just due

Discrepancy theory

The concept of discrepancy theory is to explain the ultimate source of anxiety and dejection. An

individual who has not fulfilled his responsibility feels the sense of anxiety and regret for not

performing well. They will also feel dejection due to not being able to achieve their hopes and

aspirations. According to this theory, all individuals will learn what their obligations and

responsibilities are for a particular function, and if they fail to fulfill those obligations then they

are punished. Over time, these duties and obligations consolidate to form an abstracted set of

principles, designated as a self-guide. Agitation and anxiety are the main responses when an

individual fails to achieve the obligation or responsibility. This theory also explains that if

achievement of the obligations is obtained then the reward can be praise, approval, or love.

These achievements and aspirations also form an abstracted set of principles, referred to as the

ideal self-guide. When the individual fails to obtain these rewards, they begin to have feelings of

dejection, disappointment, or even depression.

Two-factor theory (motivator-hygiene theory)

Frederick Herzberg’s two-factor theory (also known as motivator-hygiene theory) attempts to

explain satisfaction and motivation in the workplace. This theory states that satisfaction and

dissatisfaction are driven by different factors – motivation and hygiene factors, respectively. An

employee’s motivation to work is continually related to job satisfaction of a subordinate.

Motivation can be seen as an inner force that drives individuals to attain personal and

organizational goals (Hoskinson, Porter, & Wrench, p. 133). Motivating factors are those aspects

of the job that make people want to perform, and provide people with satisfaction, for example

achievement in work, recognition, promotion opportunities. These motivating factors are

considered to be intrinsic to the job, or the work carried out. Hygiene factors include aspects of

the working environment such as pay, company policies, supervisory practices, and other

working conditions.

Herzberg's model has stimulated much research. In the 1970s, researchers were unable to

reliably empirically prove the model however, with Hackman & Oldham suggesting that

Herzberg's original formulation of the model may have been a methodological artifact. However,

emerging studies have a new-found interest in the theory, particularly among employees in the

public sector and among certain professions such as nurses (Holmberg., 2016).

The theory has been criticized because it does not consider individual differences, conversely

predicting all employees will react in an identical manner to changes in motivating/hygiene

factors. The model has also been criticized in that it does not specify how motivating/hygiene

factors are to be measured. Most studies use a quantitative approach by for example using

validated instruments such as the Minnesota Satisfaction Questionnaire (Weiss et al.,

1967) There are also studies that have utilized a qualitative methodology such as by means of

individual interviews (Holmberg et al., 2017).

Job characteristics model

Hackman & Oldham proposed the job characteristics model, which is widely used as a framework

to study how particular job characteristics impact job outcomes, including job satisfaction. The

five core job characteristics can be combined to form a motivating potential score (MPS) for a

job, which can be used as an index of how likely a job is to affect an employee's attitudes and

behaviors. Not everyone is equally affected by the MPS of a job.

People who are high in growth need strength (the desire for autonomy, challenge and

development of new skills on the job) are particularly affected by job characteristics. A meta-

analysis of studies that assess the framework of the model provides some support for the

validity of the JCM.

Empowerment Employee empowerment is the process of giving front-line employees the authority to make

decisions once reserved only for managers. It has become an important topic in early 21st

century leadership as coaching style management has become more commonplace. Companies

are generally operating with less authoritarian-style management and trying to get employees

actively involved in business processes.

Delegation

Empowerment closely aligns with the leadership topic of delegation. Delegation is leaders giving

subordinates tasks to complete and timelines in which to complete them. Delegation has

generally been around longer than empowerment. Empowerment is more about trusting

employees to make decisions in customer service situations or other front-end situations when a

manager is not available. In essence, delegation is typically more task-based while

empowerment is more authority and decision-based.

Theory X and Theory Y

Empowerment is more correlated with the "Theory Y" style of management, which Douglas

McGregor explained in his 1960 book "The Human Side of Enterprise." This is a coaching style,

where McGregor's "Theory X" was a more authoritative style. With "Theory Y," leaders have a

more optimistic view of the ability to get good work from employees. This belief makes them

more likely to implement empowerment than "Theory X" leaders who are less trusting of worker

capabilities.

Empowerment Benefits

Companies and leaders have increasingly implemented empowerment because of the benefits of

empowered employees. Employees typically feel a stronger sense of ownership and worth when

entrusted to make important decisions. This, in turn, makes them more productive in their roles.

Customer benefits are also important. Customers who are angry or seeking resolution for a

problem typically want that problem dealt with as quickly as possible and get frustrated when

told that a manager is not available to help them and they will have to wait.

Considerations

While employee empowerment is increasingly popular, it is challenging in some work

environments. Managers that are not as natural at the "Theory Y" coaching style may need

training to better understand the value of empowerment and how to give appropriate authority

and trust to make it work. Some employees also need ongoing coaching and training on how to

make better use of empowerment. While leaders can deter employees from making decisions by

harshly criticizing them, they should discuss decisions and alternatives to help employees

improve.

Reward strategy Performance and reward strategies are driven by the concept that employees are not inherently

born with the desire to come to work and put in their maximum effort every day for no reason at

all. Thus, employers motivate and maximize employee performance via the implementation of a

reward system. An effective performance and reward strategy aligns with organizational goals

and objectives.

One Size Does Not Fit All

Your business is completely different from any other, so your employee performance and reward

strategy should reflect that uniqueness. Identify pertinent organizational objectives that need to

be met and how employee performance can play an instrumental role in attaining those.

Likewise, consider the organizational culture, environment and other critical factors that dictate

what types of rewards are pertinent to your employees. In order to set meaningful goals, you

must first identify what your employees want. Rewards do not have to be financial. Employees

also can be motivated by incentives like opportunities for professional development.

Use Clarity and Conciseness

Establish clear and concise goals for employees to follow. Ideally, goals point employees in the

direction you want them to go. If those goals are not properly laid out, understandable and

comprehensible, employees can be left with feelings of frustration and failure; which defeats the

purpose of the performance and reward strategy.

Make Goals Attainable

Goals should be challenging, but not impossible to reach. They should spark ingenuity and

creativeness, and stretch workers to go beyond their previous results. However, if goals are

viewed as unrealistic, the process can leave employees disheartened. The discouraging effects of

unachievable goals can leave employees unwilling to even make the attempt to reach them.

Develop Established Criteria

Just as the goals themselves should be clear and unambiguous, the metrics that gauges success

should be explicit and precise. Establish standards that can be determined and measured

effectively and objectively. For example, instead of measuring if John met his sales goals “in a

reasonable timeframe,” utilize wording such as “within six months.”

4. Understand the management of performance

Performance management Want to understand the basics of performance management? Many writers and consultants are

using the term as a substitution for the traditional appraisal system. You are encouraged to think

of the term in this broader work system context instead. Performance management eliminates

the need for performance appraisals, employee reviews, and employee evaluations.

Performance management is the process of creating a work environment or setting in which

people are enabled to perform to the best of their abilities.

Performance management is a whole work system that begins when a job is defined as needed.

It ends when an employee leaves your organization.

Performance management defines your interaction with an employee at every step of the way in

between these major life cycle occurrences. Performance management makes every interaction

opportunity with an employee in to a learning occasion.

Performance management is not an annual appraisal meeting. It is not preparing for that

appraisal meeting nor is it a self-evaluation. It's not a form nor is it a measuring tool although

many organizations may use tools and forms to track goals and improvements, they are not the

process of performance management.

Components of a Performance Management System

The performance management system may contain all of these components, but it is the overall

system that matters, not the individual components. Many organizations have been able to

develop effective performance management systems without all of the following practices.

A performance management system includes the following actions.

Develop clear job descriptions using an employee recruitment plan that identifies the

selection team.

Recruit potential employees and select the most qualified to participate in interviews

onsite.

Conduct interviews to narrow down your pool of candidates.

Hold multiple additional meetings, as needed, to get to know your candidates' strengths,

weaknesses, and abilities to contribute what you need. Use potential employee testing

and assignments where they make sense for the position that you are filling.

Select appropriate people using a comprehensive employee selection process to identify

the most qualified candidate who has the best cultural fit and job fit that you need.

Offer your selected candidate the job and negotiate the terms and conditions of

employment including salary, benefits, paid time off, and other organizational perks.

Welcome the new employee to your organization.

Provide effective new employee orientation, assign a mentor, and integrate your new

employee into the organization and its culture.

Negotiate requirements and accomplishment-based performance standards, outcomes,

and measures between the employee and his or her new manager.

Provide ongoing education and training as needed.

Provide on-going coaching and feedback.

Conduct quarterly performance development planning discussions.

Design effective compensation and recognition systems that reward people for their

ongoing contributions.

Provide promotional/career development opportunities including lateral moves, transfers,

and job shadowing for staff.

Assist with exit interviews to understand WHY valued employees leave the organization.

Learn More about Performance Management Quickly

The articles below offer information about how to master performance management quickly and

efficiently and should be read in the presented order. For your best results in developing your

performance management system.

This is the quick path to learning more about performance management and performance

development planning. You can implement this system in your organization with great success.

Performance Appraisals Don't Work tells you why you want to move away from the

traditional appraisal system.

Performance Management Glossary Entry provides the basic definition of performance

management.

Performance Management Is Not an Annual Appraisal provides the components of a

performance management system.

Performance Management Process Checklist gives you the components of the performance

management process.

Performance Development Planning provides the steps in preparing and implementing

performance development planning.

Performance Development Planning Form is used to write out specific goals and

measurements, to be updated quarterly.

Goal Setting: Beyond Traditional SMART Goals discusses goal setting.

Tips to Help Managers Improve Performance Appraisals provides concrete suggestions

about how those of you who have to manage in a traditional performance appraisal

culture can make them better—for both you and the employee.

Common Problems with Performance Appraisals identifies the most common reasons why

appraisals are not effective.

3 Main Reasons Why Performance Reviews Are Not Successful Tools explains the three

main reasons why appraisals are a bad tool.

Phrases for Approaching Performance Reviews and Difficult Conversations shares tips

about successfully holding a comfortable appraisal meeting.

With all of these tips and tools to help you develop a performance management system, you'll

find it easy to put such a system together. Staying committed and making it work is the hard

part. But, you can do it. Your managers and employees will see the utility.

For those of you who have little impact on the system used to review employee performance,

the appraisal articles will help you work with what you have. Best wishes for your success.

Personal Development

Nobody ever wrote down a plan to be broke, fat, lazy, or stupid. Those things are what happen

when you don’t have a plan! – Larry Winget

Before I share with you a powerful personal development plan example, I want you to fully

understand why it is important to have a personal development plan.

Why Do You Need a Personal Development Plan?

Have you ever gone on a holiday with no or little planning?

I did, and instead of having an adventurous and spontaneous journey, I ended up being

frustrated because I needed to plan everything during the journey.

It is very hard to fully enjoy the trip if you constantly need to think about where to sleep, what

to eat, and where to go.

It is much easier to travel when you have at least some big picture vision and an idea of where

you want to go, as well as a basic plan of the things you want to do.

It’s even easier if you have a more detailed plan.

It is the same with the journey of life. Many people just live life with no or little planning, so it is

no surprise when they end up being frustrated or asking themselves “How did I end up here?”

That’s why is important to prepare a plan in advance.

Jim Rohn said:

I find it fascinating that most people plan their vacations with better care than they plan their

lives. Perhaps that is because escape is easier than change.

If you don’t think and plan in advance, you can easily end up being angry, frustrated, and not

satisfied with your life.

There are other benefits of having a personal development plan.

If you ever find yourself feeling lost in life, you can just look into your plan and remind yourself

where you want to go. A personal development plan is your guideline for life!

By “developing” your future, you will get a better sense of control over your life and you will

make better decisions on the way.

If you are a driver, and you want to make your journey more pleasurable, you need to know

where you are going and how you will get there. Good preparation decreases the risk of things

going wrong with your journey.

It’s the same with a personal development plan – it increases possibilities that your life will go in

the right direction.

If you like the idea of having a personal development plan, you are probably asking yourself:

“Where to start?”

So, Where to Start?

A personal development plan helps you to structure your thinking. We constantly plan and think

in our head, but very often we miss important details and we don’t create a realistic strategy to

realize that plan. That’s why many “plans” stay just in our dreams.

A personal development plan is a process that consists of defining what is important to you,

what you want to achieve, what strengths you already have that help to achieve your goals, and

what you need to improve and develop with time.

When you are developing or designing something new, that’s usually not finished overnight.

That’s why you need to be prepared that every important plan will take time before it’s realized.

To make things easier, it’s a good idea to have a personal development plan template.

Personal Development Plan Template

I’ve designed this personal development plan template to help you structure your thinking and

create a strategic plan for achieving your goals.

If you want to achieve anything important, you need to take time to make a detailed plan.

There are some important things to consider when creating a personal development plan. Here

are 9 steps that can help you to create a good personal development plan:

1. Define your goals

2. Prioritize

3. Set a deadline

4. Understand your strengths

5. Recognize opportunities and threats

6. Develop new skills

7. Take action

8. Get support

9. Measure progress

Define Your Goals

What is important to you? Which new skills do you want to get? Which achievements would

make you happier? Do you have any unfulfilled dreams which you are now ready to accomplish?

Do you want to move ahead to the next stage in your career? Do you want to get a better job?

The first step is to define goals that are really important to you. It can be something related to

your career, but also something that will enrich or improve your personal life (like lose weight,

start a new hobby/activity, or learn a new language).

Step 1: Write down 5-10 goals which are important for you to achieve.

Prioritize

Out of all goals you wrote down, which one is the most important? This is your key goal which

will be your focus.

Maybe you want a career change or you want to achieve a good physical shape or acquire some

new skills.

Are there any transferable skills (skills which you can transfer to different areas of life) that

would be important for your success? For example, if you improve speaking skills, the result can

be more confidence, better relationships and communication with others, and even business

success (e.g. more successful negotiations and more sales).

The purpose of a personal development plan is to help you expand your knowledge, develop new

skills, or improve important areas of life.

Step 2: Take a good look at your list and select one goal which is the most important to you and

that you will work on first.

Set a Deadline

If you have a goal but don’t know when you want to achieve it, chances are it will never happen.

Also, if you are planning to achieve a big project in a very short period of time, again, chances

are it will not happen.

When planning, you need to be realistic, specific and make good assumptions time-wise.

Rather than saying “I want to be a millionaire someday,” it’s better to make a plan to double

your income this year.

How long will it take you to achieve your goal?

Once you have a realistic timeframe for your goal, it’s important to commit that you will really

do it. Be serious about it. If you are not the one who is taking your plan seriously, nobody else

will either.

Instead of focusing on problems and obstacles that could happen, think about how great you will

feel when it’s done. You can also define how you will reward yourself when you manage to

achieve your goal.

Step 3: Set a deadline.

Understand Your Strengths

Everyone in the world is good at something and has above average skills/strengths in some

specific areas. Even if you are not a talented singer, actor, or artist, you can still be a good

parent, excellent listener, or a caring person.

What are your key strengths?

If you are not sure about the answer, then ask your friends and family.

Ask them “What do you think are my biggest strengths?”

Maybe you will be surprised with their answers. Your key strengths are something what makes

you unique and special. No one can ever take that from you.

It’s very important for your confidence to be aware of your strengths.

Are you a well-organized, patient, persistent, outgoing, intelligent, brave, fast-learner, talented,

open-minded…?

Step 4: Once you understand what your strengths are, write down which of these strengths can

help you to achieve your goal.

Recognize Opportunities and Threats

Your current behaviors and habits can either support or not support you to achieve your goal.

Which of yours habits or actions are threats to your goal achievement?

These are the things you need to stop doing.

For example, if your goal is to live 100 years, then you need to stop smoking, stop buying junk

food, stop worrying about things, etc.

Write down at least 5 things that you commit you will stop doing.

On the other hand, there are some new actions that are opportunities for you to achieve goals

much easier.

What actions can you choose to start doing that will help you to achieve your goal?

If you want to save more money, then for example you can start managing your money, you can

start writing down your expenses, you can start spending less, etc.

Write down 5 things you commit to start doing.

Step 5: Create a start doing and stop doing list!

Develop New Skills

A personal development plan is a plan for how to get from the place you are now to the place

where you want to be.

If you want to get something, you will need to give something in return.

For example, if your goal is to move ahead to the next stage in your career, you will have to

learn new skills.

If you want to start your own business, you will have to learn about marketing, sales,

entrepreneurship, finances, etc.

A Quote by Brian Tracy:

For everything you want in life, there is a price you must pay, in full and in advance. Decide

what you really want and then determine the price you’ll have to pay to achieve it. Remember,

to achieve something you’ve never achieved before — you must do something you have never

done before. You must become someone whom you have never been before. Whatever you

want, you’ll have to pay a price measured in terms of: sacrifice, time, effort, and personal

discipline. Decide what it is and start paying that price today.

In other words, to achieve something you have never achieved before, you need to develop

skills you have never had before and start working on those skills as soon as possible.

Which skills or knowledge will help you to achieve your goal?

Step 6: Write down the list of the skills you need to develop, which will help you achieve your

goal.

Take Action

If you want to achieve a big goal, there will be many actions you will need to take.

Step 7: Write down at least 3-5 most important actions you will need to take within your

defined timeframe.

Get Support

Who can help you to achieve your goals faster?

For example, if you want to change your career, you can consider talking with a career adviser;

if you want to lose weight, you can have a fitness coach; if you want to improve your finances,

you can talk with a financial adviser…

Step 8: List anyone who you can think of who would be able to help you to achieve your goal.

Measure Progress

The best motivator to stay persistent in achieving goals is your own progress. Even if it is a little

progress, it is still something.

It is important to recognize that you are moving forward and to write down things that you are

doing well.

If something is not going so well, what can you do differently?

If something is not going well, that means that you need to change (or improve) the strategies

you are using. By doing the same things, you will be getting the same results. If you want better

results, you need to change something.

Step 9: Write down things that you need to improve and define new strategies which you will

try. Your responsibility is to make things work for you. This 9-step Personal Development Plan

Template helps you to create a detailed plan for the goal that is the most important to you. You

can use the same template to work on the other important goals or you can use this short

version of the template to quickly plan less prioritized goals.

A personal development plan is a very powerful method to assess your life, define what is really

important for you, and to start working on things that matter the most. Often in our life we are

so busy with our day-to-day activities that we rarely have time for important thinking and

planning.

Exercises like this can help you to get more clarity about goals that are the most important to

you and to create realistic strategies for how you will achieve them.