Professional Documents
Culture Documents
Leadership
While there are individuals who tend to be inherently born with more
leadership skills than others, through developing specific skills,
everyone can learn to become a leader. History is full of people who,
despite having no prior knowledge in leadership, stepped forward in
crises and convinced others to pursue their suggested course of
action. With so many definitions of leadership, each organization
needs to have a clear definition of what leadership is and what it
means to be a leader within their company. The definition can evolve
over time, but having even a basic, agile definition is better than no
definition at all.
This is exactly the situation that occurred when Toro, a maker of lawn equipment, was
taken over by Ken Melrose as CEO. Using empathy, when facing a financial crisis,
Melrose began and repaired the business the only way he knew. This case study is an
excellent example as to why empathy is such an important leadership trait. The lawn
equipment manufacturer, Toro, was greatly accustomed to lawsuits. Since introduced
equipment that was very hazardous, the company would face nearly 50 lawsuits ever
year involving serious injuries. All cases are starting to have a negative effect on the
company and also started to cause big financial problems. The business agreed to
appoint Ken Melrose as its CEO in the late 1980s. The first decision of Melrose was to
minimize the expense of litigation for the company by introducing a new method called
"Alternate Dispute Resolution" He decided to implement the ADR practice because he
and the product liability team thought the way they currently dealt with injured
customers was inconsistent with the company's values (Ethix, 2007). Alternative
Dispute Resolution (ADR) provides a confidential and alternative method of tackling
legal disputes which avoids going to court. The most common types of ADR are
conciliation and mediation, arbitration and adjudication. The conciliation and mediation
involve an independent trained mediator to facilitate communication between the two
parties having the dispute, with the aim of achieving a settlement or resolution. While
the arbitration is more formal than mediation, and involves a process in which the
dispute is resolved by the decision of an arbitrator (a nominated third party who is
qualified to handle arbitration). The arbitration process can be particularly useful in
disputes which require an understanding of technical knowledge and where privacy is
important (eg to avoid disclosure of commercially sensitive information) or if there is an
international element (ie to avoid multiple legal jurisdictions) ADR is typically cheaper
and faster than entering into litigation and resorting to the courts. As long as
communication has not irretrievably broken down between the parties at dispute, it
should be considered, as a more efficient method of achieving an outcome. It is also
helpful in terms of maintaining a degree of privacy compared to the more public nature
of court proceedings. Arbitration is an increasingly attractive option for businesses as it
enables any matters to be kept confidential which preserves the reputation of the
individuals or businesses involved. One result of the new mediation policy was a 95%
rate of resolving the company’s claims, along with significant cost savings.