Leadership concepts and applications

Leadership

Globalization has had a tremendous impact on society at large. Organizations continue to expand geographically to attract and retain new customers. These customers, are unique in their culture, values, and aspirations. As such, what once worked in a developed nation such as America, may not necessarily work in an emerging nation such as India. Collective leadership is therefore needed by businesses around the world to navigate a dynamic market environment. Two aspects of collective leadership will be paramount for business growth. Relying on a team environment and the establishment of mechanisms to share power are integral to success. Gone are the days of power among a select few individuals. The business environment now demands more collaboration among all stakeholder groups in an organization.

Relying on a Team

One particular project, currently underway within the financial services industry, is process optimization. 2008 ushered in an overabundance of financial reform and regulation. Legislation such as Dodd-Frank, Basel III, and the Durbin Amendment now require financial institutions to rethink their operating strategy. Many firms have responded with restructuring projects aimed at reducing cost, while increasing compliance with large amounts of regulation. One such company I'm familiar with is that of Bank of America (Lewis, pg.110- 116).

Currently the company is engaged in a restructuring program designed to streamline the company and make operations more efficient. This project, in order to be successful will require a massive amount of collective leadership. Simply due to its sheer size, collaboration and reliance on teams is a necessity. As indicated in the text, a well performing team often creates synergies for the firm. Through the use of the 5 Stage Team Development Model, ideas notions and concepts that benefit the organization can be derived. Bank of America uses this development model to help provide solutions to many of its financial problems. For instance, the firm created a compliance committee designed to help the bank navigate through an onslaught of new regulation. As the text illustrates, this team has less than ten members, helping to create a high performance team. These members are assigned to compliance tasks full time, with a compelling objective. Since the group's inception, the bank has one of the highest Tier 1 capital ratios (a measure of the ability to weather an economic downturn) out of its large bank peers. Through the use of teams, the organization can also gain experience and objectives it might not have otherwise obtained without them. Culture for instance, is particular important on a team, as different perspectives can enhance the overall decision making process. Different perspectives, particularly on efficient teams, can become a competitive advantage, as indicated by the compliance committee example above.

Establishment of Specific Mechanisms for Sharing Power