The two retail companies picked are Walmart and Costco whose 2017 Financial statement links are provided below: WALMART https://www.nasdaq.com/symbol/ wmt/financials?query=income- statement COSTCO https://www.nasdaq.com/symbol/ cost/financials?query=income- statement Both organizations are well known brands and position themselves well with their customer base. Walmart’s value proposition is “We save people money so they can live better”. On the other hand, Costco’s value proposition is “All-in-one convenience and everyday affordability”. Both retailers focus on cost saving for their customers. Looking at their financial statements and by analyzing them a few key areas are evident when comparing the two organization. Looking at the current ratio and quick ratio we can determine the short-term solvency of each organization. The current ratio can be determined by dividing the assets by the liabilities. Walmart’s current ratio sits at 0.86 while Costco’s sits at 0.99. The quick ratio is c
Situational leadership style
As outlined by Russell in 2011, there are many leadership theories including the situational leadership theory. An effective leader would be able to select the right style out of four options according to the internal and external environment s/he faces and to the maturity of the followers: 1) participating, 2) delegating, 3) directing and 4) selling according to the Blanchard & Hersey theory (Spahr, 2015). A leader, who masters situational leadership, would probably encourage one’s skilled team to find solutions by themselves while telling new comers what to do and closely monitoring their actions.
Spahr highlight in 2015 five different prerequisites for effectively leveraging situational leadership. Firstly, the leader should be flexible and demonstrate flexibility to adapt his/her leadership style and communication to the need of each follower. This means going beyond one’s favorite style if needed. Secondly, the leader should be able to set a two-way trustworthy relationship with peers. The mutual trust would drive motivation and engagement (Vroom & al, 2007). This brings to the third pre-requisite, that is the leader’s ability to deeply understand one’s team. This encompasses motivation drivers, fears to overcome, development needs, favorite communicate style in 1to1 and in group and potentially career aspiration. Those insights would be valuable to adapt one’s leadership style to maximize engagement and loyalty. Fourthly, the leader should be a catalyst for solutions. S/he needs to solve the issues faced by the organization or by each team member. Fifthly, a situational leader should be able to effectively coach. To be able to do so, s/he needs to understand which style to select according to the specific person involved and environment and then needs to fully transform all gathered insights into a strengthened relationship and higher involvement.
These prerequisites clearly show that training and practice are required to effectively use the situational leadership theory. While similar situations may happen from time to time, each professional and each organization’s culture are unique. There are always new challenges coming up in a constantly changing environment. Hence, the situational leadership is not a scientific approach nor a specific skill one acquires but rather an art to practice. There are also limitations such as when followers have limited skills (McCleskey, 2014) or when there is a multi-cultural environment.
Situational Leadership in Action
A few years ago, I was appointed regional field sales manager at Novartis Consumer HealthCare, managing an experienced team of ten sales representative visiting pharmacies. My favorite leadership style was then the participative one. I was convinced that involving each team member was one way to achieve strong results in each district and to drive motivation. Then GSK Consumer HealthCare and Novartis Consumer HealthCare created a joint-venture globally, opening a time of uncertainties for employment. Indeed, there was one sales representative for each company per district and strong synergies were considered. As direct manager, I was in the frontline to collect questions from my team and to keep them focused on business priorities. The situation had changed and a one-approach fits all leadership style was a nonsense to meet the specific needs of each team member. Indeed, a few considered the joint-venture as an opportunity to leave the company while getting a significative financial compensation. They had either an entrepreneurial project or were close to retirement. Others were frightened. They needed answers to their questions about what would be the potential outcome of the social agreement between the management and unions, when it would be implemented, how to react, what would the new organization following the joint-venture look like. Each situation was unique and I had to adapt my leadership and coaching. First of all, I couldn’t amend business objectives that were set by top management. I explained how important it was to reach goals with key rationales: 1) maximize the bonus paid to each sales representative, 2) set the highest potential reference in case of redundancy. This would serve as a base for unemployment allowance, 3) keep strong reputation among pharmacists. Within or outside the future joint-venture organization, my team was likely to work again with those customers. Besides, I tailored my time on the field to the specific expectations and needs form each team member. This could be allocated to specific training, in order to improve employability. This could be open discussion when I acted as a sparring partner when reviewing the pros and cons of the different options (what if scenario). The focus could also be on how to maximize the bonus by setting the right priorities and tactics. Stepping back, this was a demanding and very exciting time when I learnt a lot as a leader. I built a trustworthy relationship with each team member by understanding their specific needs and actively coaching them. I empowered them by making them responsible for the business results delivered / bonus reached and by focusing on what they could control while not going astray on what they couldn’t control.
References
McCleskey, J. (2014). Situational, transformational and transactional leadership and leadership development. Journal of Business Studies Quarterly, 5(4).
Vroom, V. H., & Jago, A. G. (2007). The role of the situation in leadership. American Psychologist, 62(1), 17. Retrieved from :
Russell, E. (2011, Sept 8). Leadership theories and style: A transitional approach. General Douglas MacArthur Military Leadership Writing Competition.
Spahr, P. (2015, Oct 30). Situational leadership. How flexibility leads to success. St. Thomas University. Retrieved from :
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