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Management and Leadership (Democratic)

(b) ‘A democratic style of leadership is the most effective leadership style for a manufacturing business in a very competitive industry.’ Discuss this view. [12] Paper 11

Democratic style of leadership is where participation is encouraged, two-way communication used and h allows feedback from staff. The workers are given information about the business to allow full staff involvement.

A manufacturing business in a very competitive industry would have to be innovative, flexible and efficient to get the edge on competitors. For example in the car manufacturing business having a democratic leadership style will allow workers to become involved in decision making to drive productivity improvements. Workers may also be more motivated and work harder. This should allow the production cost to decrease allowing for bigger margins than competitors.

However, to enjoy the gains of democratic leadership there need to be a suitable corporate culture in the manufacturing business and a higher skilled workforce who can be trusted with greater responsibility. It will initially take more time to and resources to build this positive relationship with staff.

Furthermore, it will mean decision making will be slower. If the manufacturing business has to change product lines quickly in response to competitors this could be a disadvantage in a competitive dynamic industry.

When a manufacturing business is considering which leadership style to implement it needs to evaluate what should be the focus which will give their business the greatest advantage. The productivity gains from a democratic leadership style may not be as great as investing in capital equipment which may be most cost effictive in improving efficiency and increasing margins.

Furthermore, successful implementation of democratic leadership depends on a number of factors, including employee skill level and motivation and the corporate culture of an organisation.