A Crisis Causes Andrea Jung to Change Her Leadership Style



A Crisis Causes Andrea Jung to Change Her Leadership Style

1. Andrea Jung used the directive style to solve Avon’s financial problems.

In this particular story, Jung set up goals to solve the financial problem and keep Avon continuing growth in a global scale. Like Paula Stern said: “She has her hands directly on the levers that to be moved.”

2. The leader style of course will not be consistent all the time according to “Consistency Theory”. It depends on the leaders’ situation control.

“Consistency Theory” focuses on leaders characteristics. One of the most important features is “least preferred coworker” (LPC) . Avon had been cutting lots of positions before. During the financial crisis, Jung cut another quarter of her best 1000 managers in the world. Her is a low-LPC leader that considers workers in a negative light and concerned employees with good performance. She increased her situation controls even sacrifice her family time with kids to maintain the companies good work. This type of leaders is highly effective under both “low situational” and “high situation” controls.

But it doesn’t work well in-between. So she may keep Avon a successful performance while she remains the high situation control. But once she wants to spend more time with family or “employees” decide by themselves or being lazy for a while, Avon’s performance might drop.

3. According to “Path-Goal” Theory, a leader can affect the performance, satisfaction, and motivation of a group. But, it also depends on situational factors: the environment and the subordinates’ characteristics.

Her problem is:

When a group is working on a task that has a high structure, then directive leadership may not be very effective. Also, after Avon is having a very good system running very well, her directive leadership may reduce worker’s satisfaction.

4. “Transactional leadership occurs when the leader rewards or disciplines the follower depending on the adequacy of the follower’s performance.”

She cut off 7 layers of management and changed her mindset, changed Avon’s marketing and product development and also herself worked with a high enthusiasm.

In this particular story, Jung started to change her leader style with “active management-by-exception”. She started to serve Avon Company as a role model and even sacrificed her family time. Her performance and enthusiasm encourage employees.

The High Cost of Ethical Neutrality

1. Carly Fiorina changed HP’s priority from nurturing employees to financial performance. Another good approach to improve HP’s performance is to “enhance” the current culture instead of totally breaking it and build another one, depending on how strong the current culture is or how much the effort and potential cost is. And also, if HP’s culture was really bad and had to be changed, she could “innovate” it gradually by promoting ideas while sharing her values to current workers. She was obviously not effective in changing the culture. In another word, she did change the culture for a short period time to focus on revenues, but also made HP’s long term earning drop and caused problems as employees’ satisfaction decreasing, reputation dropping and even violated some common ethical beliefs.

2. In this example, we can actually see Fiorina’s impact on all four aspect of ethical climate which are sensitivity, judgment, motivation, and character:

She made workers so sensitive about the “numbers” because they may be “replaced” if they fail. Also sensitive during her investigation of the info leak; Salesmen started to give discounts and focus on their own earning of the season instead of thinking for the companies long term benefit; During the Compaq merging battle, “private investigation” was also a huge damage to HP, regardless from the aspect of ethical motivation or moral and human rights challenge;

It was a very bad influence to HP’s ethical climates.

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