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... o key ingredients of leadership involve "the need to have a clearly articulated and agreed vision and the need to manage others effectively." (Cell, 2001, p. 173) 7. 1 MANAGEMENT STYLE At present there is no recognised management style. (Appendix 7 (i) ) The stakeholders concerned are in a partnership of equality, bearing different skills and decision-making is collaborated. Mr. Desai could be categorised as 1 in the diagram, however, he does not take on this role solely. 7. 2 REFLECTION Although Mr. Desai is partly classified as 1, he possesses 3 and 6 traits, where his managerial and delegation skills are utilised, complementing Miller and Drive's theory (1986); "the need for high achievement that drives the entrepreneur may result in the centralisation of decision-making." Mr. Desai fits Mintzberg's (1973) interpersonal and decisional category, (Appendix 7 (ii) ) where formal and informal networks are formed due to the size and maturity.
In addition, leadership traits exist; implementing the vision, while now management plays the more dominant role. Therefore, it can be seen that management and leadership overlap. However, Kotter in Cell (2001, p. 188) highlights, "they concern two entirely different systems of action", they may be two different systems, but, they can be amalgamated to emanate a new one. (Appendix 7 (iii) ) 7. 3 IMPLICATIONS Management and leadership are combined and there have been no defined designated roles amongst the partners previously. This has so far proved to be effective through counterbalance of planning, organising, problem-solving, motivation and envisioning. In the future, a hierarchical system implemented could disrupt organization culture and put the company into jeopardy if the company remains small. Conversely, if SWE expands operations they will require more employees, the use of a flatter structure is recommended. 8. 0 GROWTH Entrepreneurs need to recognise the importance of decision-making; "a critical issue in the growth of emerging ventures." (Kuratko et al, 2001, p. 79) 8. 1 GROWTH OF SWE SWE has concentrated utilises external resources; networking, where an established relationship has been formed with UCH, SWE has taken advantage of resource acquisition of intangible and tangible assets.
This has aided them in developing their market position, through informal, centralised, non-specialised management style of decision-making. 8. 1. 1 GROWTH WISH Mr. Desai has expressed a desire to grow, however, a number of hurdles need to be overcome to precede expansion, and these are principally profit-related issues. "Businesses who wish to grow have more acute finance problems because of their need for development finance." Buckland et al (quoted in 1995, Carter et al, 2000, p. 340) Research has shown; only 10 % of firms want to grow and of these only 10 % actually do. (Hakim 1989) Issues of macro-environmental are outside SWE's control, this in turn influences growth. 8. 2 GROWTH MODEL (Appendix 8 (i) ) SWE have reached near the end of the growth phase. Inception stage took off well due to identification of market and financial back-up. This has led to volume of production reaching across many borders, market share augment of up to 20 % and minimal marketing efforts. SWE are in preparation for the expansion phase.
The growth has been relatively slow in contrast to the inception stage which was rapid. Stages 3 - 5 will be reached if barriers are overcome. (Appendix 8 (ii) ) 8. 3 CRITICISMS There are criticisms of such models of growth, namely, Churchill and Lewis (1983) (Appendix 8 (iii), Greiner (1972) (Appendix 8 (iv) ) and Storey (1984) as all firms do not follow the 'S'-Curve as boundaries between phases are merged and phases are not always in logical order. Greiner's and Churchill & Lewis's models are process-orientated and rigid. For example, SWE has not implemented any strategies or supervision in stage 1 of Churchill & Lewis and crisis of leadership is not present as Greiner's model states. Stages 3 and 4 of Churchill & Lewis show a functional and management style, however, this exists during stages 1 and 2 in SWE. Therefore there is no logical progression in the sophistication of the individual factors.
The predictive model approach concentrates on financial variables, predicting failure and success from implications; however, this cannot be relied upon as factors outside the control of SWE cannot be predicted. Although, Storey et al claim a 75 % success rate in determining success or failure. The characteristics model of Storey, postulates "small firm growth is driven by three integral component sets: characteristics of entrepreneur, firm and strategy." (Deakins et al, 2003, p. 289) This model is complex and there is uncountable number of factors to consider. 8. 4 IMPLICATIONS The growth cycle provides a useful basis on which to underpin key issues influencing SWE. As SWE has not reached further than the expansion stage it is difficult to predict what might happen in the future. There is a need for a close eye on internal and external factors that may influence company performance and outcome. Control systems and strategic implementation should be considered. 9. 0 FINANCE The wish to grow statistic remarked in the growth section is due to a minority of firms realising their ability in responding to market conditions and benefiting from these which, derives from operating flexibility. "They promote competition within sectors in which they proliferate" Bolton (quoted in 1971, Stanworth et al, 1991, p. 50) moreover, they "operate at the marginal of structural change, with their entry to and exit from different sectors facilitating economic restructuring." Binks et al (1990, quoted in Stanworth et al, 1991, p. 50) 9. 1 SWE FINANCING (Appendix 9 (i & ii) ) As mentioned throughout, SWE are financed through the UCH's investment from initial set-up, thus repayments have been successfully met.
Profit generation is their current method of finance. 9. 2 PUBLICATIONS APPLICATION IN RELATION TO SWE As far as publications go, SWE have solid foundations to work from which has been influenced by the companies' life-cycle, Courier and Despatch sector and desires of Mr. Desai. A number of studies have shown a link between small firm's annual reports and accounts, providers of finance, and the difference between small and large firms. From a financial-economic perspective small firms need to generate profits and large firms have the advantage of the stock market. SWE was fortunate that UCH had invested with the knowledge of the high risk involved. From the socio-economic standpoint, in this context, it can be argued that SWE could be defined as a medium-sized company as this describes the relationship between the partners and UCH, all being shareholders, while SWE hold independence. 9. 2. 1 FINANCE GAP At the inception stage, SWE held a narrow finance gap; (MacMillan Committee) exploitation of opportunities.
This 'hard capital rationing' has proved somewhat successful; nonetheless they have experienced fluctuations. The current financing has widened the financing gap, thus relying on profit could be stagnated at any time. 9. 2. 2 EQUITY GAP There is a clear problem faced by SWE, this is the equity gap where there is a mismatch of debt and equity, this is evident from repayment periods; debtors: 30 days and creditors double this. SWE's growth could be at risk if gap persists and could unfavourably affect the economy. 9. 3 IMPLICATIONS The last year's financial profits have fluctuated due to repayments to UCH. In a sense it has been beneficial to SWE credit facilities were refused; avoiding high interest rates, oversupply of credit and moral hazard.
Careful financial planning is a necessity if SWE wishes to be a minority of successors of small businesses. Cost-cutting methods are required to retain profits to obtain facilities from financial institutions, who demand to observe another couple of years of financial accounts. Debt and equity are of concern as are the high overhead costs; reduction could lead to retained profits, in which resource investment could be undertaken. 10. 0 MARKETING "The simple premise of marketing is that to be successful, any organization must understand its customer requirements and satisfy them in a manner that gives the organization an edge over its competi...
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Research essay sample on Management And Leadership Decision Making
