Leadership Management

A quite asked to me recently rather swept me off my feet. It was: “Is Leadership Actually Improving Over Time?’.

This is an incredibly difficult question to answer, in fact – I couldn’t really give a proper answer at the point of questioning, because there were too many factors to think about. We will work through these below.

The first factor is about how we are actually going to measure the growth or improvement in leadership quality over the years. There are several issues with this measurement process:

The lack of a good quantitative means of measuring success. Share prices (Market Cap) of companies would be a terrible proxy for leadership because they are affected by so many other factors, such as economic cycles, politics, monetary and fiscal policy. Other factors such as the results of certain polls and surveys wouldn’t be comparable to surveys and polls taken many years ago, because polls are not consistent between decades as different researchers researching leadership styles and leadership courses have slightly different hypotheses.

When it comes to qualitative factors, we’re in no better position. The personal account of famous leaders throughout history will be littered with error and bias, and will make for an unfair comparison across the ages. Giving a thorough qualitative survey to leaders now asking about the leadership skills of leaders during their lifetime would also through bias onto the fire.

So rather than approaching this in a scientific way, we could look at the changes in the leadership landscape over the years, as highlighted by the leadership authors and commentators. History may not paint a perfectly accurate picture of the real changes on the ground of real British business, but it would provide the best picture we can attain.

In my opinion, due to the increases in leadership education as well as a larger aspirational middle class than 50 years ago, leadership has improved significantly, becoming more democratic and more transparent.

As promised in an earlier post, this is the first and one of many personal finance articles I hope to publish on Leadership Management over the next few months.

I’d like to start from the very start – and give an instructional guide on how to buy shares online for the first time. I chose this topic because it’s often the first response I hear from someone who I ask “Why do you have all your savings in cash if you plan to save it for a very long time?”. Indeed the ‘how’ often eludes the public, because little media attention is given to the personal ownership of shares, (apart from the odd story explaining how an old couple invested entirely in one share lost all their life savings when a corporation collapsed (e.g. Royal Bank of Scotland dying).

The truth is that buying shares is actually a very simple process. You could compare it quite easily to opening a savings account or a savings bond with NS&I. The ‘How’ will be explained below. As to the ‘Should I?’ ‘Which do I..’ and ‘When should I?’… you should read future financial articles posted here for extra tips!

Open an Account

To buy and hold shares, you need a brokerage account. There are two types of broker – discount brokers and full-service brokers. If you know what shares to buy and are looking for an executor, then a discount broker is for you. If you want financial adviser and perhaps someone to manage your account, you’ll be looking for a full-service broker. Discount brokers – as the name suggests – are much cheaper than full service. A full service broker will typically charge 3 x times more in fees, but obviously you get an extra service against that cost in return. I personally feel that the financial advise from full service brokers when it comes to ‘stock tips’ is pointless, and it is best to aim to minimize your overhe

Fund the Account

You’ll need to transfer funds into your brokerage account from an existing bank account. This should be a smooth process, as brokers will want you to be funded as soon as possible! In line with money laundering regulations, a brokerage firm will need to verify your identity before allowing you to invest. This can usually be done by entering information which it will check against your public record, but if you are not on the electoral roll or have not had a bank account in your name then it is likely that you will need to send in documents etc to prove your identity.

With the business environment continuously changing, it is important that the leader has effective traits to keep up with the changes. If the leader does not have the right traits, he or she will be ineffective and will not get the work done that could benefit the company or business.

If you are a leader or looking for a leader to run your business, it is important to keep in mind the leadership traits that are necessary. As this will help you develop your own skills or the skills of the leader that you hire. There are 6 basic traits that should be present in any leader and they are discussed below.

• Need for achievement:  A leader needs to take responsibility and work hard to succeed. In order to achieve the goals and objectives of the company; the leaders need to be determined and know what is expected from them. Achievement can only be gained if the leader is clear of the vision, goals, objectives and tasks or duties that need to be fulfilled to gain competitive advantage in the market.
• Intelligence:  No leader can be successful or effective if he or she does not have the knowledge of the work that needs to be done.  The leader needs to have the right set of skills, such as good sense of judgment to make sure that the decisions that are made are logical and effective.
• Decisiveness: As a leader there will be many situations that will be hard to solve and get out of, which is why it is important that the leader can make the right decisions without any hesitations.
• Self- confidence: This trait is very important because if leaders do not have confidence in themselves; followers will not be confident in the leader enough to trust them. Leaders need to give a positive image to their followers to show that they are cable of succeeding.
• Initiative: Leaders need to be self-starters; this means that they can get the job started and finished without having supervision to get the job done effectively and correctly.
• Supervisory ability: Leaders need to be able to get the job done through other people who have the skills to do so. This means that the leader should motivate, supervise and encourage followers to get the work done without hesitation or dissatisfaction.

These 6 traits are necessary in any leader, so if you are lacking in any of the traits be sure to take the right course or training to improve them.

As a crucial pillar of management – financial management is an important aspect that all broad leaders should be trained in. A manager who isn’t financially minded will struggle in an economy that is becoming increasingly reliant on financial services, as well as financial risk management and financing strategies in industrial companies. In other words, one cannot escape from the vast, sprawling effect of finance on the UK economy, and therefore no management should be ignorant of financial management or personal finance. Every manager should education themselves on various financial principles such as ;

Principle 1: Investing – Learn how the stock markets and other financial markets work. Be prepared to put your own money where your mouth is an confidently build a smart portfolio of stocks.

Principle 2: Risk Management – Learn the principles of risk and risk management. Understand how companies can use hedging and financial instruments to reduce or eliminate specific financial risks such as commodity pricing risk or exchange rate risk.

Principle 3: Budgeting – Budgeting is a mainstay of British management practice, but personal budget is also important. If you cannot keep your own finances in order, why would someone pay you to keep their businesses’ finances in order?

Use various textbooks, online resources and formal education to brush up your knowledge on these areas.

There are two distinct part to leadership studies and leadership guidance. The first is practical – ‘How do I achieve that, how do I use that trait, how should I change my behaviours’ in other words How to Be A Leader, the second is determinant – asking the question What is Good Leadership?

This topic needs to be dealt with in a polarised fashion – because these are very different areas.

How to Be A Leader

This is there element of the leadership world which is personal development related. Leadership Videos and courses focusing on this topic will be extremely focused on the individual with a laser pointer. Like any skill, leadership is something that can be taught and can be learnt through a mixture of classroom, experience and also mistake! Let’s not forget that some of the lessons we hold most tightly in our minds ultimately are derived from a mistake we made in the past! Well, the idea of leadership videos and courses is that you can actually learn from the mistakes of others before you make the same ones.

What is Good Leadership
What is good leadership is the study given to ‘what actually occurs’ rather than simply ‘what should be occurring’, which this phrase otherwise may suggest. Therefore researchers who are looking to analyse and draw tips and strategies from successful leaders do so by analysing many case case studies to isolate the leadership traits and qualities which appeared to hold the key to leadership success in each instance. This practise can have potential downsides, such as survivor’s bias – which means that researchers assume that successful leaders have been successful because of their talents and traits, whereas in reality they may have simply survived due to blind luck, indeed in spite of their particular leadership traits.

For example, in 2007 (before the financial and housing crisis) one could have looked at which companies had been the most successful in the decade. The answer was unanimously the real estate developers and banks. One could’ve at the time drawn that the qualities needed to run a successful business were to engage in as risky activity as possible. However recent years have allowed us to look back on these events with heinsight, and we would now conclude that real estate businesses simply did well because they were in a bubble, and not because their owners were particularly talented.