UNIVERSITY OF SOUTH AFRICA

ASSIGNMENT 3

MNG 4801

Date : September 25, 2014

MUYOMBO, JRM

33703485

Table of Contents Question 1: Strategic leadership ..................................................................................................... 3

Question 2: Responsible leadership ................................................................................................ 5

Question 3: organizational architecture.......................................................................................... 6

Reflection......................................................................................................................................... 8

References ....................................................................................................................................... 9

Question 1: Strategic leadership Introduction The lack of leader has been cited to be the cause of many strategic failures. Many

strategies have not seen the light of day because leaders have not been able to properly

apply leadership principles to the chosen strategy. While strategy gives direction,

leadership guides execution. Paul Polman‟s is regarded a strategic leader in many senses.

One of the points that earned his reputation was, upon joining Unilever; Paul decided to

go against a conventional wisdom of offering earnings guidance to the market

(Interview). Not many leaders in his position would have done that considering that the

world was coming out of recession due to financial crisis. Many people would have

wanted to continue with the practice in order to feel the market. It takes courage and a

different approach to make such unpopular decision. We will describe below the

effectiveness of Paul Polman as strategic leader by first looking at what strategic

leadership entails, then we will describe effective strategic leadership within the

strategic management field and lastly evaluate Paul strategic leadership.

A description of what strategic leadership entails In paraphrasing many authors, Leadership is said to be all about getting things done

through the agency of other people, the ability to delegate without the fear of losing

control. It is important that leadership permeates all the levels of management. As all

managers need to apply a form of leadership that is consistent with the organizational

chosen strategy. There is a kaleidoscope of leadership styles available from transactional

to transformational leadership. Louw L and Venter P 2013, describe leadership as the

ability of one person to influence another to move in a certain direction.

Strategic leadership is about translating what is set at the board level into a well running

machine; meaning being able to do what was planned without being omnipresent or

policing 24 hours in all departments which is physically impossible and it is the ability

attributed to legend and gods. It is the leadership by top-level executive. The leader ought

to think strategically, be emotionally intelligent, have a range of behaviours at their

disposal, and be a transformational and able to apply in the context of Africa, African

leadership.

Effective strategic leadership Louw and Venter describe strategic leadership as being about understanding the entire

organisations and the environments within which they operate. This is about Strategic

management which begins with strategic direction, where leaders set the vision, the

mission and strategic intent of the organisation, and then make a strategic choice based

the findings of the environment and sometimes gut feeling. For instance in the case of

Paul Polman and Unilever 2009, Paul communicated that their strategy was execution.

Unilever, being consumer goods relied on their ability to manufacture goods efficiently

and responsibly. Whether low cost strategy or differentiation is followed, their product

should not fail. As he mentioned in the interview that quote:” I have seldom met a

consumer who buys our products because they like our strategy….”

The second part of the strategic leadership according to Louw and Venter 2013 is to

identify and create strategic change with and through people to position organisations in

the environment for both short-term stability and performance and long-term

sustainability and success. This means leaders will make the necessary changes amongst

other things in structure and the culture of the organisation to see it succeed in a long

term while being stable in the short term. For instance Paul had to change the thinking of

the critical mass from perceiving Unilever as one of the pawn for financial speculation to

a product oriented and responsible organisation. He had to go back to the essence of the

business, to satisfy customers‟ requirements. This required re-alignment of priorities and

creating a sense of urgency in the organisation. He demanded teams to draw up 30- and

60-day plans to resolve any prickly issues with brands in the market. It is reported that

these quick wins helped steady the ship. Strategic leaders make use of competencies and

do certain tasks to be effective strategic leaders as described below

Competencies and tasks of effective leadership Louw and Venter 2013 write that in order to bring strategy to life, leaders need

demonstrate certain competencies and do certain tasks. The competencies include: the

ability to think strategically this means to apply various strategic models in order to

identify, diagnose, conceive and implement a solution in the organisation. There are a

number of models; the pervasive ones are the open systems model. In this model, the

organisation is viewed as open system that interacts with the environment (External and

Internal). The organisation takes in inputs (raw materials) from the environment and

converts them into need satisfying goods and services to be absorbed by society through

the market system ( Louw and Venter 2013-421). The internal context of the organisation

consists of sub-systems such as technical, psychological, structural and managerial. Paul

Polman can be said to be using the open system model because he understands what

business Unilever is in. He says “our business is a very simple one of getting the right

products at the right place at the right quality at the right time-all the time. Whether they

are manufacturing or buying and selling, this business model is consistent with the open

model system and the task of effective strategic leader of building and using core

competencies.

Conclusion Louw and Venter 2013 state that 37% of potential value according to Marakan, of the

strategic plan is lost due to unsuccessful implementation. This can be caused by various

reasons including inadequate resource, poorly communicated strategy, implementation

not clearly defined, unclear accountability, in essence lack of strategic leadership. A

strategic leader uses competencies and does strategic tasks to make sure that the mission

and the vision of the company are translated into successful venture. He/she is to use a

variety of leadership style to suit the strategy. In the case of Paul Polman, he states that,

his organisation focus is on execution, getting the right product all the time. His

leadership is seen to be transformational.

Question 2: Responsible leadership Introduction Responsible leadership is a concept that can be linked to corporate social responsibility

and performance to actions on the part of policy makers and leaders (Pless, Nm, Maak,

T& Waldman, D 2012). The key concern is the responsibility of organisation toward

stakeholders. Looking at the organisation as open system, we can agree with The

European commission definition of CSR as "the responsibility of enterprises for their

impacts on society" (European Commission, 2011, p. 6). This somehow, guides the

discussion of responsible leadership. To put in another way, responsible leadership is

referred to the organisation sense of responsibility towards various stakeholders

including shareholders, employees, customers, and the environment; who is the

organisation accountable to and to what extent?

Matrix of responsible leadership The degree of accountability and the focus of stakeholders allowed Pless and colleagues

determine four orientations of responsible leadership (Pless, Nm, Maak, T& Waldman, D

2012). The orientations are traditional economist, the opportunity seeker, the integrator

and idealist. The traditional economist and the idealist have a narrow focus on

stakeholders while the opportunity seekers and the integrator‟s views are broad, in

essence they focus on more than just the shareholder, however the opportunist degree of

accountability is leaning towards the shareholders more than other stakeholders. The

integrator spreads their accountability to include more than just share price but also

corporate social and environmental accountability. For the integrator, this is not a ploy

for compliance to regulations but they form part of the strategy. Paul Polman‟s

responsible leadership can be described as an Integrator.

Stakeholders Up on taking the position, Paul decided to shift the focus away from the share prices to

consumers and customers. He states that he does not drive the Unilever business model

by driving shareholders value. This is consistent with the integrator as he pledges his

allegiance to execution rather than strategy. He wants to focus on the right thing.

Leadership characteristic An integrator is said to embrace rationality and emotions. Paul understands the

importance of share value at the same time believes that for the organisation to stay the

course, he has to focus on sustainable business. As they redefine Unilever in terms of

giving one billion people access to nutrition and wellbeing and the commitment to

develop suppliers. At the same time he says that in focusing on doing the right thing for

the consumers, financial results will follow. This means, although the moral values are

enlarged, but the focus is not off from financial performance unlike the idealist who gets

deluded by vocation and does not pay attention to financial sustainability of the

organisation.

Conclusion Paraphrasing, Pless et al, the traditional economist and the idealist orientation to

responsible leadership are have become rare as many organisations, civil society are more

aware of organisation impact society and the duties towards the society for reparation of

restitution. Responsible leadership is the combination of rationality in terms of

accountability and a wider scope of stakeholders which Polman has demonstrated in his

change in business reporting and strategic focus. He stopped the practice of offering

earnings guidance and forged on the performance culture.

Question 3: organizational architecture Introduction Louw and Venter 2013, when describing building block or enablers of strategy

implementation, they propose six key drivers to implementation including short-term

objectives (balance score card), leadership, organizational culture, resources and

organizational architecture, systems and processes. Organisation architecture combines

all resources and capabilities of the organisation into a winning team. They must work

together well and synergistically says Thompson J and Martin F 2006. It creates the

proverbial invisible hand that holds the organisation together. In discussing Unilever

strategy implementation, we will look at the elements of organisational architecture

model in general and particularly what Paul Polman focuses on. Secondly how Paul

Polman is implementing the strategy by applying these organisational architecture

elements.

Elements of the organisational architecture Organisational architecture makes it possible to implement a strategy. A number of

models are available that organisation may use including amongst others Ulrich,

McKinsey 7-S and Lee et al. for our purpose we will focus on the later (Lee et al). the

elements of the architecture which is usually represented as a flow diagram and read

from right to left, are stakeholders, capabilities, processes , structure/ systems,

knowledge/skills/abilities and technology and lastly not least culture. The important thing

is to have a mental or strategic thinking cap on. This enhances the organisation

performance by locating pressure points. In this case Paul Polman using architecture

knew exactly where to apply the pressure in order to become responsible company in the

eyes of the shareholders and society. His emphasis is on stakeholders, capabilities

processes and culture. I think it is given that part of the strategy of execution is horning

on the knowledge, skills and abilities.

Stakeholders Stakeholders are individuals or institutions who have a claim on the organisation

existence. The European commission explains their understanding of stakeholders by

defining the corporate social responsibility as the responsibility of the organisation for

their impacts on the society. The impact can be viewed as touching all factors of

production including land, labour, capital and entrepreneurship. Each of the factors of

production are remunerated in their own way for instance the impact of land or

environment can be remunerated by rehabilitation of the environmental, going the

sustainable by using renewable energy , planting trees and paying for carbon tax.

Capabilities Capabilities are what are delivered to the stakeholders for instance shareholders require

share value and perhaps dividends, customers require reliable goods and services. For

instance when a company says we are available 24/7, they must be able to meet the raised

expectation of the customers by showing performance when required.

Processes are what are needed to delivery capabilities in terms of training, awareness in

the organisation

Culture The culture is defined as” how we do things here”, therefore there should not be any

ambiguity about tacit or explicit behaviour and what it means to the people in the

organisation. For instance informality could be a culture adopted where everybody is

called by the first name. The moment the person is called by their surname, could signal

that the person is new to the organisation or could an outsider.

Implementation by applying these organisational architecture

Paul Polman is by now seen as a transformational leader and applies responsible

leadership. His approach to Unilever undoubtly indicates that is frame of reference to

strategy implementation is s Lee et al model. The model starts with the stakeholders and

ends with the culture

Stakeholders Upon joining Unilever Paul decided to level the plain field and stretched his focus on a

number of stakeholders other than shareholders and you would be forgiven to think that

he had relegated shareholder to a secondary stakeholder. He began by removing the focus

on share price emphasis and turned the lens light to other stakeholders including

consumers, suppliers and employees. He states that focusing on the customer and

consumer in a responsible way with the knowledge of shareholders value in mind.

Capabilities This is what is delivered to stakeholders. Shareholders are promised share value, for

customers, it is the improvement of the quality of their lives, providing nutrition to about

a billion people across the world. And for other stakeholders, it is to encourage

sustainable agriculture by sourcing their material in a way that is sustainable.

Processes Processes are things organisation do to meet the capabilities or performance to

stakeholders. In the case of Polman, he uses urgency and open door policy. He demanded

that the teams draw up 30-60- days plan to resolve any prickly issues with the brands in

the market. This is a way to guarantee that customers are taken care of not just by paying

leap service but the organisation has to plan and intervene before they lose customer

equity. Secondly, in order to avoid any bureaucratic burden, he has an open door policy

where it assumed employees at any level can engages with him to expedite matters. In

order words, he is accessible; he responds to e-mails and does video conferencing with

employees all over the world.

Culture He states that this is a culture of openness and performance. He made sure that everybody

understands the vision and direction of the company by the unveiling of Unilever‟s vision

and ambitious sustainability plan. So there is no ambiguity. He also states that this is

consumer goods. For them execution is very important. Share movements are often

happening because of lack of execution on the other side he remarked. In order to enforce

a culture of performance, they have accountability as a driving force. People should know

who is accountable for what

Conclusion Strategy implementation can only happen if the organisation is able to align strategy with

the architecture. Stakeholders focus, capabilities, processes, system/structure, knowledge,

skills and abilities and culture are part of the architecture and they have to work together

to meet strategic objectives.

Reflection 1 To what extent do you feel that you have achieved the learning outcomes for the

study units in this assignment?

I do not know which

learning outcomes

were relevant to this

assignment

Did not

achieve the

learning

outcomes

Limited Moderate Fully

achieved the

learning

outcomes

2 Please indicate the extent to which the doing of this assignment contributed to your

understanding of the course concepts.

Did not contribute

at all

Limited

contribution

to

understanding

Unsure Some

contribution

to

understanding

I now

understand

the course

concepts

3 If you could redo this assignment again, what would you want to do differently?

Mark your top 3 choices; you can add your own opinion in the space provided

below:

3.1 Start with the assignment earlier. x

3.2 Contact the lecturer(s) for assistance.

3.3 Form a study group.

3.4 Have more contact with fellow students to discuss the assignment.

3.5 Be more active on the myUnisa discussion forum to share ideas.

3.6 Start earlier with recommended readings. x

3.7 Consult evaluation sheets more extensively before starting with the

assignment.

3.8 Other:

I should have read the assignment first to identify the content needed to

study instead of spending time on studying material that had no bearing

on the assignment. For instance I studied chapter 11 on globalisation.

x

4 Indicate the three most difficult aspects of doing this assignment.

4.1 Knowing what is expected of me in this assignment.

4.2 Finding relevant sources to use.

4.3 Distinguishing between relevant and non-relevant information to

include in the assignment.

4.4 Using the electronic databases to access articles/journals.

4.5 Integrating the various sources into one document. x

4.6 Applying the course concepts to practical examples.

4.7 Understanding the course concepts.

4.8 Adhering to page number limitation.

4.9 Adhering to referencing requirements.

4.10 Writing the assignment in a style that is acceptable for a postgraduate

student.

4.11 Meeting the deadlines.

4.12

5

Coping with work, study and family.

While doing the assignment, did you realise that there is a gap between

the theories and the practical application (i.e. how it is done in

practice?).

If yes, what do you think this means?

Sometimes it is very difficult to conceptualise the theory and

practice if one does not have the exposure to such application

therefore they remain abstract for now

X

yes

References 1. Bell, G. 2013. ‗Want to change the world? Think differently: an interview with Paul

Polman, CEOof Unilever, part 2„. Strategic Direction, 29(5):36–39.

http://0-www.emeraldinsight.com.oasis.unisa.ac.za/journals.

2. Pless, NM, Maak, T & Waldman, D. 2012. ‗Different approaches toward doing the

right thing:

mapping the responsibility orientations of leaders„. Academy of Management, 26(4):51–

65.

http://0-web.ebscohost.com.oasis.unisa.ac.za

3. Polman, P & Bird, A. 2009. ‗Conversations with global leaders„. McKinsey. [Online]

Available

from:http://www.mckinsey.com/insights/strategy/mckinsey_conversations_with_glob

al_leaders_paul_polman_of_unilever [Accessed 22-09-2014].

4. Louw, L & Venter, P 2013 Strategic management third Edition , developing

sustainability in Southern Africa, Oxford University Press, South Africa

5. Thompson J with Martin F 2006 :Strategic management, Awareness and change 5th

edition. Thomson learning. Britain