Introduction
Traditionally, research about leadership has laid more emphasis on the traits of a good leader rather than the leadership approach adopted in an organization. It is vital to note that a leader can have all the right characteristics to lead an organization, but the leadership used in the organization could limit their actions. For organizations to be successful, it is vital that the leader or managers be in agreement with the follower/ employees. The agreement between managers and staff is important in creating a conducive work environment with little conflicts and at the same time enhance the implementation of decisions made by the organizational leaders.
The baseline is that an organization should choose the best leadership approach to enable the managers provide the appropriate direction to achieving the set objectives of the company. According to Badshah (2012), leadership is a complex field in behavioral science and no particular leadership approach is better relative to the rest. However, in some organizations certain leadership approaches have proven efficient and invited other organization to follow them. Of all the leadership styles, situational leadership has been widely used in many organizations, notably in the 500 Fortune companies. In simple terms, the latter refers to a leadership style where a leader is allowed to adjust their leadership approaches to influence a particular change or outcome in an organization.
This paper aims to establish how situational leadership has help exemplify Quicken Loans, one of the Fortune 100 companies. The paper will also explain the positive impacts of the style in the company and how the approach is different from that used in poorly performing companies such as Express Scripts.
Company Overview
Quicken Loans was established in 1985 and is situated in the mortgage lending industry. It is headquartered in Detroit, Michigan. According to the US National Mortgage News, Quicken Loans is the largest mortgage provider in the USA market, with over 2 million having subscribed to the company's services since its inception. The organization is highly successful in its business, having closed over $ 140 billion in mortgage loans in the 2013 – 2014 trading year. Its work culture is designed to provide a healthy competitive environment to enhance growth if the employees' skills. This factor has made it one of the most attractive company to work in in the USA mortgage retail industry. The company's success in terms of profitability and unique organizational culture can be traced to its talented managers as well as the effectiveness of the leadership at the company. The following is a discussion of how situational leadership has led to the effectiveness of the company in both creating a competitive work environment and beating the competition in the market.
Situational Leadership Styles at Quicken Loans
Kenneth Blanchard and Paul Hersey introduced the situational leadership theory forming it around the premise that the best leadership is being able to adapt to the prevailing situation facing the organization internally or externally. It advocates that organizational leaders should react to different situations by suing the most appropriate leadership approach (Bourantas & Agapitou, 2014). Managers at Quicken Loans have been able to employ diversity and adaptability while dealing with internal and external factors (both threats and opportunities), something that has steered the company to the top 100 Fortune companies. According to Bourantas & Agapitou (2014), a situational leader can lead their organizations to four different approaches.
These are Telling and Directing, Selling and Coaching, Participating and Supporting and Delegating. At Quicken Loans, however, the delegating style of situational leadership has been more consistent. Under this style, manager and supervisor’s hand over their duties to trusted employee, but are active in each decision-making process in the organization. The employees in the organization are highly trained and experienced which makes them perfect candidates to use delegation as a form of leadership in the organization. This form of leadership is efficient and encourages the employees to perform better as the delegation of involving activities acts as a motivating factor. Additionally, engaging employees at all levels in the major operations of the organization has helped ensure healthy relationships between the management and the management. In turn, this has helped a favorable environment for the management to push its strategies (NetMBA, 2010). Other benefits of this leadership style can be seen from the value added for using delegating in a company.
Benefits of Delegating as a Form of Situational Leadership
Although the use of delegating has been criticized by some human resource management, it can prove very useful in an organization especially a service organization like Quicken Loans. The organization's human resource employs competitive and experienced employees to help achieve the primary objectives of the company. The organization is focused on helping the employees realize their full potential by placing involving duties in their hands. By doing this, the organization has been able to create a competitive teamwork in all the company's workplaces (DuBrin, 2015). This is vital in an organization since it fosters an output oriented work culture. Additionally, the employees feel like they are part of the organization, which according to Abraham Maslow's hierarchy of needs is important in motivating the employees (NetMBA, 2010). Apart from helping develop the self-esteem of the employees, delegating helps enhance the loyalty of the employees to the management. By placing important duties in the responsibility of junior employees, the latter feels loyal and accountable to the managers and the organization in general.
For the management, delegating allows the top managers and supervisors handle more crucial organizational matters and time for development and improvement of the company's strategies. This can be cited as one of the reasons behind the success at Quicken Loans as delegating some duties have left ample time for the management to develop ways of taking advantage of various opportunities in the market. Comparing this model to other styles in situational leadership, delegating comes top if the goals of the management is to motivate their employees to perform to their level best (NetMBA, 2010). Delegating has even impacted positively of the overall image of the company as shown below.
Impact of situational leadership (delegating)
Impact of Situational Leadership on the Overall Company Image
As seen above, delegating helps managers focus on more crucial matters in an organization and at the same time relieve them the stress they would have endured carrying out the duties themselves. The employees become motivated to perform duties delegated to them, in most cases to prove themselves to their managers. In turn, this has created a competitive nature at the organization's workplaces. This competition has been effective in the job market. The company is regarded as one of the best places to work because it is in the top 100 list of Fortune companies. Concerning the management of the company, delegating has helped the management respond to matters that are either opportunities or threats to the organization. This has created a culture of efficiency in the company's management (Bourantas, & Agapitou, 2014). The development of new and better strategies for the enterprise is made easier with the use of delegation. This has made the company's management one of the best in the industry (McKay & McKay, 2009). The use of situational leadership has impacted on the organization positively because it enables the management focus on more pressing matters. Apart from this, it has allowed the management to adapt to changes in the external environment such as the great recession. Due to this effective leadership, the company is considered a prestigious and highly profitable company.
The benefits and impact of the above leadership style can be seen when the approach is contrasted to the leadership style at Experts Scripts. The latter, which has been painted as one of the worst places to work in America use telling and directing styles of situational leadership. This leadership approach requires that the managers dictate the duties to be performed and the manner in which they are to be accomplished. The impact of the employees is that they feel diminished and discouraged to perform the duties. Unlike in the use of delegating, telling and directing does not allow for employees’ freedom in the performance of duties. This creates many problems in the workplace, including lack of motivation, boredom, or even conflicts between the manager/supervisors and the junior employees. The overall impact is the development of a negative attitude towards the management and their duties. This is because unlike in delegating where employees are loyal to leaders, telling and directing (Kroth & Kroth, 2007). The combination of these factors makes the employees demotivated and perceive the managers negatively, which could play a vital part in the downfall of the company.
Conclusion
Situational leadership helps an organizational management adapt to changes within or outside the company. To be specific, delegating allow time and focus for the management to handle crucial decision and factors affecting the company. To the employees, it helps the develop a positive attitude to both the management and the duties delegated to them. This has been the case of Quicken Loans, which has helped the company climb to the top 100 of the Fortune companies. Concerning the working conditions delegating has helped grow and enhance the skills of employees at the company making it attractive to work. The success story of using situational leadership and delegating at the company can provide a valuable lesson to other companies, which use ineffective situational leadership styles.
Different management and leadership styles have significant effects of the workforce productivity and performance, which affects the performance of an organization. As such, the ability of Quicken Loans to rise to the top 100 fortune companies is an indication that the organization has been able to identify, develop and implement effective leadership and management styles. The ability of the organization to employ situational leadership characterized by effective delegation has enabled the top most employees to focus on important tasks, while lower level employees focus on other tasks. Such an approach enhances focus and workflow, which enable people to identify the action points and unimportant tasks. Through delegation, an organization is able to identify various channels that can enhance the success of the business and reduce costs related to employees.
References
Badshah, S. (2012). Historical study of leadership theories. Journal of Strategic Human Resource Management, 1(1), 49-59.
Bourantas, D., & Agapitou, V. (2014). Chapter one: From leadership competencies to leadership meta-competencies. In Leadership Meta-competencies: Discovering Hidden Virtues. Burlington: Routledge.
DuBrin, A. (2015). Leadership: Research Findings, Practice, and Skills. London: Cengage Learning.
Kroth, M., & Kroth, M. (2007). The Manager as Motivator. London: Greenwood Publishing Group.
McKay, B., & McKay, K. (2009). The Art of Manliness: Classic Skills and Manners for the Modern Man. New York: HOW Books.
NetMBA. (2010). Theory x and theory y. Retrieved fromhttp://www.netmba.com/mgmt/ob/motivation/mcgrego
