Chapter 1: Introduction

1.1 Research Introduction

With the increased competition, it has become essential for the organizations to remain
competitive in the market. Businesses are building their KSAs knowledge, skills, and
attitudes to get a competitive advantage. Effective leadership is one such function of
organizations which helps in not only maximizing the organizational efficiency but also
adding up in the uniqueness of the organization in the market.

An organization with a competent leader is in a better position to provide guidance, initiate

action, creating confidence in its employees and building morale and motivation in the
organization. Moreover, with the proper guidance from the organizational leaders, there is a
coordination between different activities and people in the organization which further helps in
building a positive and healthy working environment (Carroll, Ford & Taylor, 2015).

The approach adopted by the leaders for managing people and activities in the organization is
also critical. It is believed that with the changing business scenario, the need to manage
resources and capital through systems, procedures, and policies is not sufficient, rather there
is a need to lead them. The leadership style defines the approach of the leader to involve
people in the organization.

Each leadership style adopted by different leaders has different outcomes. Some leaders
might adopt an inclusive approach where they include ideas and opinions of their team,
whereas some may opt for a self-centric approach where the authority is held by the leader. It
is necessary that the leaders are situational, which signifies that depending upon the
circumstances and outcomes required, leaders should select the appropriate leadership style.

In the UK economy, the retail sector holds a prominent place. It is considered to be the
largest employer in the private sector in the UK. The major players in the UK retail industry,
primarily in the supermarket segment are Aldi, Asda, Morrisons, Tesco, Walmart, and
Waitrose (Retail Economics, 2018; Smith, 2017). As the industry holds a vital place in the
UK economy, the need for good managers with appropriate leadership styles is evident.

The style adopted by the leaders would have a direct impact on the performance of the
company which would in turn collectively impact the performance of the industry. This
research study, in this respect, is conducted to analyze different leadership styles that are
adopted by the leaders for managing their organizations in the retail sector of the UK. In
order to understand the concept critically, a case study of the retail giant, Asda is discussed in
the study to identify the impact of leadership styles on the commitment level of employees
and performance of the company.

1.2 Research Background

Leadership in management is all about identifying ways to meet the needs of the organization
and employees. It is the quality of leadership skills which plays a major role in building
successful companies. A strong leadership is a set of skills which works in harmony to
accomplish the organizational goals. The right type of guidance in the business can ensure
organizational effectiveness and maximize the company's output.

While there are various types of leadership skills and styles that are used by managers in
running the business, its selection is important, as the selection of leadership style directly
affects the achievement of organization goals. This is because the leadership styles adopted
by the individual determines the manner in which an employee is treated in an organization,
which in turn determines its morale and motivation level (LaMarco, 2018).

The degree of authority, delegation, and participation impacts the satisfaction level of
employees and the overall organization. According to Khattar (2016), in the retail sector, it is
required for the managers to be flexible in their approach to lead the organization. It is not
necessary that the autocratic style which is working in one retail company is found to be
effective in another. Similarly, democratic leadership style which is found to be an ideal
solution for leadership problems might have demerits in the retail sector (Khattar, 2016).

It all depends upon the situations which the leaders are facing in the organization. However,
the most commonly used leadership styles are autocratic, democratic, laissez-faire,
persuasive, transformational, and cross-cultural leadership (Chestnut, 2017). In addition to
this, leadership styles such as strategic, team, transactional, facilitative, charismatic, and
visionary leadership styles are also adopted by leaders in the retail sector (Chestnut, 2017;
Siebers, 2011).

The research conducted by Shrestha and Mishra (2011) also indicates that a leader managing
his leadership style as per the situations is likely to have a positive impact on the commitment
level of employees. According to the literature, out of all the leadership styles, the
transformational leadership style holds a prominent role in impacting both the employees'
commitment levels and organizational performance (Shrestha & Mishra, 2011).

The transformational leadership style which encourages employees to be a part of the

leadership process which in turn motivates the employees and increases their commitment
towards organization. The transformational leaders tend to identify the changes needed along
with their team, inspires them and execute the changes with the help of team members
(Alkahtani, 2015). As a result of the increased commitment, it is likely that the performance
of both employees and organization increases.

Similarly, in the research conducted by Wiza and Hlanganipai in the year 2014, it is observed
that every leadership style affects the commitment and performance of employees and overall
organization. Impact of certain leadership style is found to be positive while the impact of
other styles is found to be negative. For example, transformational leadership style has a
significant and positive role in impacting the continuance and affective commitment level of
employees.

While, on the other hand, the transactional leadership style only affects the normative
commitment level of employees (Wiza & Hlanganipai, 2014). Therefore, it becomes essential
for the policymakers of an organization to carefully decide on the leadership style which is to
be chosen for attaining the organizational goals.

1.3 Research Aims and Objectives

In the current competitive world, leadership has become an essential factor in ensuring the success of
any organization. A leader is responsible for directing all the activities towards the accomplishment of
organizational goals and assure long-term success. In this regard, the current research is aimed at
assessing the leadership styles followed in the UK retail sector with respect to the retail company
Asda. The research is focused on analyzing different leadership styles that are followed in the retail
sector. To attain the aim of the research successfully, the objectives of this research are listed below:

 To find out the leadership style adopted in Asda

 To determine the impact of leadership style on employee commitment in Asda
 To investigate the effect of leadership style on organizational performance in Asda

1.4 Research Question

With regard to the concerned research, the following research questions are developed for the
research which would help the researcher in meeting the research objectives.

1. Which leadership style is adopted by the retail company, Asda?

2. What impact does the leadership style adopted by the company, Asda has on the
commitment level of its employees?
3. How has the leadership style adopted by the company, Asda affected the performance
of the overall organization?

1.5 Research Rationale

Leadership style may be defined as an approach taken by a leader or a manager in managing
the organization. It might be commanding or directive style or collaborative or a participative
style. Every leader has its own style, some leaders are prone to use a single leadership style
through all situations, whereas some leaders might be flexible in nature and use different
leadership style depending upon different situations.

However, in both these instances, it is significant for the leaders to identify their primary
leading preferences. This is because it becomes easier for the leaders to evaluate the
effectiveness of their adopted style in the given circumstances (Warner, 2012). Similarly, the
leadership styles adopted by the company's managers in the retail sector is also detrimental to
the success of retail outlets.

Retail companies employ a comparatively large number of employees that other sector
companies (Sakai, Matos & Galinsky, 2008). A good leader, in this case, is essential to
ensure that the collective objectives of the organizations supersede the individualistic goals.
Moreover, the leaders also ensure that all the activities that are carried out in the organization
are directed towards organizational success (Iqbal, 2011).
The research study, in this regard, is an attempt to identify and study the leadership styles that
are adopted by the retail companies in the UK. With the help of this study, the effectiveness
of different leadership styles under different scenarios would be obtained, based on which
selection could be based as to which leadership style should be adopted in certain situations.

Furthermore, the conclusions derived from this research study would serve as a basis for
understanding and analyzing the relationship that exists between different leadership styles
and employee commitment. As this study is making use of specific case of a retail company,
Asda, it would be useful for the managers of the company is getting an overview of the
leadership styles which are adopted by various leaders in the company.

Moreover, as the research study is also focused on identifying and analyzing the impact of
leadership styles on the commitment level of employees and performance of the company,
the managers would be in a better position to make the judgment about their preferred styles.

This study would be useful for managers to analyze the impact of their adopted style on the
overall organizational effectiveness, which in turn is likely to help them in the appropriate
selection of leadership styles in the future situations. In addition to this, this research study
would also serve as a conceptual framework for the future studies which are directed in this
area.

1.6 Summary
This chapter provides a concise introduction to the concept of leadership and leadership
styles. The chapter has provided a brief description of the relationship between the leadership
styles, commitment, and performance in an organization. This section of the report has also
provided an insight into the justifications behind the selection of this topic by the researcher.
The background section of the chapter has provided a brief picture of the literature already
available on the topic. Moreover, the aims and objectives of the study are clearly mentioned
for which the study would work towards.
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