MGT420 REASERCHING ON LEADER PDF

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A FAMOUS CONTEMPORARY LEADERBACHELOR OF BUSINESS ADMINISTRATION (HONS) MANAGEMENTMGTBA2441A1 AND COMPANY PROFILEAs I have mentioned before, this study of a famous contemporary leader will be conducted and focused on the CEO of Netflix that is Reed Hastings Jr.Picture 1: Reed Hasting Jr (CEO of Netfl...

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A FAMOUS CONTEMPORARY LEADER

BACHELOR OF BUSINESS ADMINISTRATION (HONS) MANAGEMENT MGT420 BA2441A

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1.0 LEADER AND COMPANY PROFILE As I have mentioned before, this study of a famous contemporary leader will be conducted and focused on the CEO of Netflix that is Reed Hastings Jr.

Picture 1: Reed Hasting Jr (CEO of Netflix) Wilmot Reed Hastings Jr. is an American businessman that was born on October 8th, 1960. He is the co-founder, chairman, and co-chief executive officer (CEO) of Netflix and sits on several boards and non-profit organizations. A little background as to where he first started working before he ventured into creating Netflix, his first job was at Adaptive Technology, where he created a tool for debugging software. Later, he left Adaptive Technology in 1991 to lay the foundation to his first company, Pure Software, which produced products to troubleshoot software. The company’s success was doing amazingly well that in 1995 he sold it and made $750 million from his stake in the company. He then left the company in 1997 after its merging with Atria Software and started Netflix during the same year with former Pure Software employee, Marc Randolph where they both co-founded Netflix, offering flat rate movie rental-by-mail to customers in the US by combining two emerging technologies which are DVDs and a website to order the DVDs from. As of October 2020, Netflix had over 195 million paid subscriptions worldwide, including 73 million in the United States with an operating income of $1.2 billion and is a member of the Motion Picture Association (MPA) which produced and distributed content from countries all over the globe. It now has a market value of $121 billion with Reed Hastings' net worth increased to $3.1 billion due to his Netflix stake.

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2.0 NATURE OF LEADERSHIP Co-ordinating people's activities and directing their efforts towards the organization's goals and priorities is an important part of management. This includes the leadership process and the selection of an acceptable type of behaviour. A fundamental characteristic of organizational behaviour is leadership. The manager must consider the essence of leadership and the variables that decide the success of the management relationship. The nature of leadership looks at the leadership relationship, different approaches and styles of leadership, main studies and contingency theories, and situational factors which determine the characteristics of leadership. [ CITATION Mul09 \l 17417 ] 2.1 The Leadership Relationship It may be beneficial to point out that the partnership with leadership will take place in a variety of ways. A leader can be imposed, formally appointed or elected, informally chosen or arise naturally through the situation's demands or the group's wishes. Leadership can also be attempted, effective or successful. They also may exercise authority as a formal characteristic of position or based on charm or personal qualities. The power of leadership will depend on the form of authority that the leader will exert over other individuals. 2.2 Approaches to Leadership There are many ways of analysing leadership. Therefore, a leader and their subordinates must have some framework in which to consider different approaches to carry out a certain task. 2.3 Styles of Leadership In the work situation, style theories and leadership as a behavioural category have been given growing attention. There is a wide spectrum of potential leadership behaviour, although greater focus has been put on a more democratic and participatory approach. Despite the many forms of real leadership behaviour, however, there seems to be consensus on two main leadership dimensions: (a) concern for the job, development or structure that is autocratic and authoritarian and (b) concern for maintenance, people or consideration that is democratic and participative. Tannenbaum and Schmidt's work and the continuum of leadership actions provide a valuable focus for discourse on key leadership styles [ CITATION Joh05 \l 17417 ] 3

Reed Hastings uses a democratic and participative style where he was considered unequal by hierarchal standards have shared power in making decisions. 2.4 Contingency Theories of Leadership When evaluating the attributes of leadership, contingency theories draw attention to the significance of situational variables. In a specific leadership scenario, the most suitable type of leadership depends on the variables. Main situational variables include leadership situation favourability, decision consistency and approval of decisions, subordinates' personal characteristics and mission nature, and how ready are the followers or groups. In order to lead a company or to make decisions instead, the optimal course of action is contingent upon internal and external situation. In this case, Reed Hastings has given the approval of the company to showcase the movie “House of Cards” in under 30 minutes after taking the feedback from his team 2.5 Transformational Leadership Transformational leadership is a leadership theory in which a leader works with teams to define the required change, build a vision to direct change through inspiration, and execute the change in tandem with dedicated community members. It is when a leader’s behaviour influence followers and inspire them to perform beyond their perceived capabilities and to achieve unexpected and remarkable results. It gives workers autonomy over specific jobs, as well as the authority to make decisions once they have been trained. This induces a positive change in the follower’s attitudes and the organization as a whole. [ CITATION Odu13 \l 17417 ] Reed Hastings started mailing DVDs with a business partner in 1998 and would ultimately continue to grow the film and TV streaming service we know today. Hastings demonstrated a transformative leadership style in many respects, apart from creating a revolutionary and transformative business model. He brought his own human resources version, removing structured assessments and incentives, while allowing workers to make their own choices as long as they "act in the best interests of Netflix." Focusing on people has earned Netflix a solid work culture, as well as 88% approval ratings [ CITATION Jas19 \l 17417 ]

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2.6 No One Best Style of Leadership It is widely claimed that a “people-centred” approach to human relationships is more likely to contribute to job satisfaction and successful results by working groups. However, it is important to remember that democratic leadership styles are the best and there may be times when a more autocratic style is more effective. At various stages of an organization, different types of leadership may also be most suitable. National culture can be another major variable affecting leadership style selection. There is no 'best' leadership style and the variety of variables underlying the efficacy of managerial leadership in job organizations should be specially noted.

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3.0 LEADERSHIP TRAITS AND SKILLS Leadership traits are characterized as integrated personal characteristic patterns that represents a range of individual differences and facilitate consistent leadership efficiency across a range of group and organizational circumstances[ CITATION Zac04 \l 17417 ] From early leadership studies, the theory of trait leadership is developed and focused primarily on discovering a community of heritable traits that distinguish leaders from non-leaders. Many academics have argued that leadership is unique to only a small number of people and that these people have some immutable qualities that cannot be produced but this view has been greatly criticized over the past century. Research has shown that successful leaders differ from other individuals and possess certain primary personality characteristics that contribute significantly to their performance. Understanding the significance of these core personality characteristics that predict leadership effectiveness will help organizations pick, train and improve leadership practices [ CITATION DSc11 \l 17417 ] In this case, leadership traits and skills include drive, motivation, honesty and integrity, extroversion, self-confidence, and conceptual ability. 3.1 Drive Physiologically, drive is a determined urge to attain a goal or satisfy a need or means. Successful leaders possess a drive that is infectious to succeed. They can inspire their workers and make them believe in the vision of the business. An individual may have all the business knowledge in the world, but the venture is doomed to fail without a drive to succeed due to that, in order to solve the challenges that every organization faces, a leader must have the drive to succeed [ CITATION Jan16 \l 17417 ] Reed Hastings has proved that he did have the drive to succeed when he created Netflix. The idea of Netflix had come to his mind after he had to pay $40 in late fees for returning a movie late. After the scenario happened, it became a goal of his to somehow create a way whereby he could give the chance for consumers to watch movies for as little or for as long as they want if they paid their fees and subscribed to Netflix but like most innovative companies, most of them are failed to strive at first but Reed Hasting had made up his mind and had the drive to still go on with his idea and now making it a globally known company that is currently worth billions.

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3.2 Motivation Motivation is the mechanism that initiates, directs, and preserves goal-oriented behaviours. It is often used in daily use to explain why a person does something. It is the guiding force behind the actions of people [ CITATION Ken20 \l 17417 ] In regard to managing an organization, it is important that a leader is motivated as this helps the management to influence the motivation of their employees. Reed Hastings’s described a feeling of adventure and a desire to serve as his motivation [ CITATION Jer15 \l 17417 ] In relation to him being motivated, after Pure Software merged with Atria Software and there were integration issues between the two companies in 1996 with Hastings deciding to leave his new position of ‘Chief Technical Officer’ in 1997, he decided to spend two years thinking about how to avoid the same types of problems during his next start-up. This can be taken as a sense of his motivation as he still tried to find a way to avoid the same problem when he wanted to create a new company. 3.3 Honesty and Integrity Integrity is perhaps one of the most important principle of leadership as it demands truthfulness and honesty [ CITATION Tra16 \l 17417 ] Honesty and integrity is important because although leaders need to be courageous, they also need to be open to the idea that they could be mistaken. Reed Hastings has thought a lot about the importance of maintaining integrity as a company’s core principle. He said it in an interview “Unless you make honesty a core value, the business internally becomes impossible to operate. And if executives see me lying to other executives or to outsiders, they wonder, of course, if I am lying to them. Conversely, when they see us take a short term hit on some goal because we are honest, it fills them with confidence that I’m honest towards them.” From the above quote we can clearly see how honesty and integrity happens to be a core value for Reed Hastings. He admitted that without it, a business would be impossible to operate and thus will eventually fail in the end.

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3.4 Extroversion Generally, extroversion is defined by the general tendency to encounter positive emotions, as well as having positive traits such as being sociable, lively, and active. Having a leader that is extroverted can be an advantage in an organization as it can provide a clear authority structure and direction for the company. It is admitted that Reed Hasting’s was more introverted is his latter company then he is in Netflix. After starting the company, Reed Hastings has been very responsive to the needs and wants of his employees and subordinates. It is said that he also does not like the idea of staying in his office as he prefers to walk around the departments and engage with his fellow workers. 3.5 Self-confidence In short, self-confidence is an attitude regarding a person’s skills and abilities. In other meanings, it involves accepting and trusting one’s judgement and sense of control in their life. It is also needed for leaders to take risks and accomplish high goals. Leaders who are self-confident are more likely able to deal problems and conflicts immediately, rather than ignoring it. [ CITATION Pat02 \l 17417 ] Leadership involves influencing others and selfconfidence allows the leader to feel assured that their attempts to influence are affective, appropriate and right. Reed Hasting has proven to have a high level of self-confidence when he started Netflix. Admittedly, he had his doubts, just like every businessperson would and at first when Netflix was created, it was looked down by a lot of Blockbuster CEO’s office and was rejected partnership proposals to Blockbuster in 2000 but he still pursued on creating Netflix because he was confident enough that Netflix would turn out as something huge, which it now is. 3.6 Conceptual ability Conceptual skills are the abilities that allow an individual or in this case, a leader to understand difficult situations in order to develop a creative and successful solution. In other words, it is a talent that addresses complex scenarios with an innovative approach. Regarding Reed Hastings’ traits on conceptual ability, when in 2008, a collapse of Netflix’s database shut down shipments for 3 days. With the difficult situation that the company was in, Reed Hasting was quick to reach out to the globally known online business “Amazon”.

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The complication that Netflix had encountered ultimately led it to Amazon cloud computing. Netflix has flourished in Amazon cloud, and at one time has 20,000 servers processing its data. 4.0 LEADERSHIP BEHAVIOUR Leadership behaviour are characteristics and acts that make a person successful as a leader. This behaviour is the mechanism by which an individual may guide, direct and influence others' work to achieve specific objectives. To maximize the productivity of those around them, these actions and techniques can be taught. These behaviours are used by individuals and leaders to inspire people and to take action when they have a vision for a company, a product or a group of people in an organization. In this study, we will be researching on the task orientation and relations orientation of a leader. It is important to note that task-oriented leadership is often contrasted with relationshiporiented management. One stresses the activities necessary to accomplish targets, and the other focuses on the relationships needed to keep workers happy with their job [ CITATION Onl14 \l 17417 ] 4.1 Task Orientation "Doing whatever it takes to get the job done" is perhaps the most succinct concept of taskoriented leadership. The style appears to be autocratic and stresses the execution of tasks necessary to accomplish organizational objectives. [ CITATION Onl14 \l 17417 ] Taskorientated leadership skills include prioritization, time-management, strategy, delegation and communication. The benefits of this leadership style are that, with maximum effectiveness, it retains high expectations. Under this kind of task-oriented leadership, workers who need structure and who struggle with controlling their time perform well because it is more structured and timedriven [ CITATION Adi19 \l 17417 ] In regard to this study, it seems that Reed Hastings does not really use this behaviour in running Netflix. It is said in his book [ CITATION Ree20 \l 17417 ] that his goal into running the company is to inspire his employees more than manage them. So, he gives them lots of freedom, resources, and knowledge in support of their decisions and trusts their teams to do what they think is best for Netflix. This, in turn, creates a sense of accountability and selfdiscipline that pushes them to do excellent work that benefits the business. In order to avoid 9

the rigidity of over-specialization and avoid the confusion of growth, while preserving independence, they work to make a company as easy as they can to offer their ambitious growth and to keep the excellence of employees growing. They work to have a company of self-disciplined individuals who find and solve problems without being told to do so. Netflix fosters freedom and empowerment of their employees wherever they can. 4.2 Relations Orientation To put it simply, relationship-oriented is an approach in which an individual focuses on the encouragement of team members and their general well-being. One of the greatest advantages of people-oriented management is that workers believe that they make a difference in the company by concentrating on employee relationships. And better, more successful actions come from individuals who believe they are part of the success of an organization [ CITATION Adi19 \l 17417 ] Reed Hasting does focus on relations orientation as his leadership behaviour in order to run Netflix. He takes good care of his employees and tries as best as he can to communicate with them. As an example, if any of his employees were having difficulty focusing due to the loud noise, Netflix provides a machine whereby they can use sound-proof earphones without having to pay. In addition, Netflix encourages their employees to offer feedback anytime and anywhere. If feedback is given with positive intent and with an aim to help the recipient, as well as provides an alternative solution, feedback can is encouraged to be given anytime, anywhere. In return, the recipient needs only to show appreciation for the feedback, but they are not required to apply or use it. [ CITATION Hal20 \l 17417 ]

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5.0 LEADERSHIP POWER The influence of a leader will decide how well common objectives are accomplished in the workplace. This power is a basic instrument which is used by great leaders. Depending on the environment, personality and abilities, the type of power used varies from person to person. The control that leaders have over their followers is leadership power. It persuades others to help and do as they ask for their efforts. Influence is crucial to leadership because without it, leaders will not be able to make a company or an organization succeed. It is also a key component of authority and control.

Power and authority are sometimes used interchangeably, but there are nuanced distinctions in their definitions. Power is the control that a person has over someone or in this case, a leader has over their employees and subordinates. It refers to the capacity to, with the aid of others, achieve a goal. The right to exercise that power is the right of authority. Owing to their role in the workplace, supervisors have jurisdiction. Because of this, they have a sort of control, but if they are well-liked by peers, a staff member may also have power. The employee has little jurisdiction, but because of their friendship, colleagues are prepared to obey them. 5.1 Position Power Positional power is simply the authority exerted by one's role in the structure and hierarchy of an organization. It is the power that is vested by the leader in an organization that is strengthened by a set of rules and laws that are applied in a specific framework, within an institution, a nation, or a corporate. The aim of this power is to guarantee that a group of people conform and work together to achieve the common goals set out for the larger group. As we are all aware, Reed Hastings is the CEO of Netflix, which leads me to believe that logically, he has a lot of power in his hands regarding the choice in the company’s decision making as well as having a high power in the hierarchy of Netflix’s organization. With the 11

power that he has, Reed Hastings has created a program called the ‘Keepers Test’ which involves letting go of employees that seems to not bring any positive or ground-breaking impact to the company. Reed Hastings said that Netflix’s ‘Keeper Test’ is a “normal ...