ACCA F1 Accountant in Business - 2010 - Study text

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Chapter 7: Management and leadership

Successful leaders need this informal authority as well as the formal authority

granted to them by their position.

Heifetz (‘Leadership Without Easy Answers, 1994) suggested that there are two

types of challenge for leaders in business. Each type of challenge needs different

leadership qualities. The two types of problem are as follows:

 Technical problems. These are problems that have a relatively simple answer.

Current knowledge can be applied to find a solution to the problem.

 Adaptive problems. These are problems where the answer involves a need for

people to change – change their culture and outlook. People are resistant to

change; therefore the solution to the problem involves getting people to learn

new ways.

Technical problems can be solved by managers (transactional leaders). For adaptive

problems, transformational leadership is needed. Heifetz has referred to problems

requiring significant change as ‘adaptive work’.

Six principles of leadership and adaptive change

Successful leadership depends on judgement, and making decisions about when to

act, and how far to go each time. Change should not be introduced too quickly, but

only at a pace that individuals can accept. Leaders must act within the context of

‘permission to change’ from the people affected and ‘restraint’ – not going further at

any time than other people are willing to tolerate.

Heifetz suggested that there are six principles of leadership for adaptive change.

Get on the balcony A leader must have an ability to observe changes

that are happening and to mobilise others to

respond. It should be as if the leader is on a balcony

with a clear view of all the entity’s activities. The

leader must then be able to mobilise the right people

in the right way to do the required adaptive work.

Identify the adaptive

challenge

A leader has to see what response is needed to the

new challenge and change. Heifetz used as a

comparison an example of a band of chimpanzees

that knows how to respond to a threat from a

leopard, but does not have the leadership to know

how to respond to a new challenge from a human

with a gun.

Regulate distress Having identified the adaptive challenge, the leader

must generate just the right amount of ’distress’

among other people in order for everyone to see and

understand the need for change. Change and

progress must be introduced at the right pace – a

leader must progress at the ace that other people are

willing to accept. The leader must always point

others in the right direction by asking them key

questions.

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(Heifetz even suggested that the assassination of a

political leader is a failure of leadership. A political

leader who tries to bring in changes too quickly

might expose himself to assassination, from people

who dislike the pace at which the changes are

happening.)

Maintain ‘disciplined

attention’

The leader must get conflict out into the open and

use this as a source of creativity. Constructive

conflict among individuals leads eventually to

collaboration and agreement. The leaders most likely

to succeed are those who make followers aware of

their responsibilities.

Give work back to the

people

Leaders should not control and direct. They should

provide support and allow people to find the

solutions to problems through their own efforts.

Change is a collaborative process.

Protecting voices of

leadership from

below

Leaders should give a voice to other people in the

organisation, and should allow others (below them

in the ‘hierarchy’) to raise contentious issues.

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AccountantinBusiness

CHAPTER

Individual and group

behaviour: team management

Contents

1 Individual and group behaviour in business

organisations

2 Teams and team roles

3 Team formation and development

4 Effective and ineffective teams

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Individual and group behaviour in business organisations

 Characteristics of individual behaviour at work

 Characteristics of work group behaviour: formal and informal groups

 Individual and team approaches to work

 The role of management in team building

1 Individual and group behaviour in business

organisations

This chapter looks at the role of individuals in work and the role of work groups.

You should be able to relate many of the ideas in this chapter to your own

experience, either at work or in other entities, such as a business school or college.

1.1 Characteristics of individual behaviour at work

Individuals go to work for a reason. The main reason is the need to earn money in

order to have a good life outside work. Many individuals have a keen interest in the

type of work that they are doing, and enjoy the work that they do.

Working in a business affects behaviour, but individuals behave in different ways.

 Individuals might think that when they are at work, the employer regards them

as someone who is paid to do a job. They might therefore decide that they need

to get on with the job they have been given, and perform the job adequately, so

that they don’t get into trouble from their boss.

 Some individuals have a pride in their work, and try to do their job to the best of

their ability.

 Some individuals need to be told what to do by their boss; others are much

happier using their initiative and getting on with their work without having to

be told what to do.

 Individuals do not work in isolation, on their own. They work with colleagues,

and individuals differ in the way they interact with their colleagues. Some enjoy

communicating with other people, and like this aspect of their work. Other

individuals do not communicate well with other people, and so might

concentrate on their work and even refuse to join in conversations in the work

place.

 The behaviour of individuals can also be affected by the prospects of promotion,

career advancement or higher pay.

1.2 Characteristics of work group behaviour: formal and informal groups

Individuals work with other people. A work group is a group of employees who act

with a common purpose and a sense of identity. There are two types of work group:

 informal work groups, and

 formal work groups.

Chapter 8: Individual and group behaviour: team management

Informal work groups

An informal work group is a group of employees that does not have a formal or an

official identity. It is a group of individuals who get on well with each other and

interact socially. They might have lunch together regularly, or might talk about

personal interests and family matters over a cup of tea or coffee. Some informal

groups might meet together outside work, on a social basis.

Informal work groups often develop a collective attitude to their work. This attitude

might be positive, or it could be hostile to management.

Informal work groups can also be important because of the way they communicate

with each other. Sometimes, news of an event or a new development at work gets

around much more quickly through informal communications (e-mail messages to

colleagues and phone calls) – ‘through the grapevine’ – than it does by more formal

communication channels.

Formal work groups

Formal work groups are created in order to organise work. The employer

establishes work groups to perform specific roles or functions. Each work group has

a number of jobs to be performed, and employees are appointed to fill the job

vacancies. When one employee leaves his job, another person is appointed in his

place, and the formal work group continues unchanged.

Employees work together in their work groups, each performing their own job

within the group. The work group has a formal leader (a manager or supervisor),

and will develop its own characteristics and ‘culture’.

The purpose of a formal work group

The purpose of a formal work group is to:

 combine the efforts of several employees, working together,

 to achieve a common goal.

Teams are established because individuals working on their own would be unable

to achieve the same output or end results.

Comparison of formal and informal work groups

The differences between a formal work group and an informal work groups are set

out below.

Formal work groups Informal work groups

Members of the formal work team are

appointed by management.

An informal work group comes

together through the social interaction

of its members.

Membership of a formal work group is Membership of an informal work team

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‘permanent’ . Employees continue to

work in the group until they leave their

job or until they are moved to other

work by the employer.

depends on the social interactions

between members. New members may

join the group at any time, and existing

members may leave.

A formal work group has a clear set of

work tasks, with specific objectives.

These are set by management.

An informal work group is not

organised by management and does

not have a specific objective or tasks.

The work group has a formal existence. The informal group does not exist in a

formal or clearly-defined sense.

Work group members have formal

roles and job titles.

Informal work group members do not

have set roles or titles.

A formal work group has a formal

decision-making structure. Decisions

are commonly taken by the group

leader.

Informal work groups might not make

any decisions that affect their work.

However, if they do, the group

members will reach a collective

agreement.

Management assess the performance of

a foirmal work group by its

performance (efficiency and effectivess

in carrying out its tasks)

An informal work group is not

assessed. However, its collective

attitude to management can range from

supportive at one extreme to hostile at

the other. Employee attitudes to

management can be determined by the

shared attitudes of informal groups.

Formal work groups work together

through established procedures and

systems.

Informal work groups can be much

more efficient (than formal methods) in

communicating information.

1.3 Individual and team approaches to work

A function of management is to get the best performance possible from the

employees who work for him (or her). There are two approaches to achieving

effective performance.

 The individual approach. This approach is based on the view that work should

be properly organised, and employees should be appointed to carry out specific

job functions. If each individual performs his job effectively, the entire work

group will perform effectively. The effectiveness of the work group is the total

sum of the effectiveness of each group member.

 The team approach. This approach is based on the view that a work group will

be more effective if its members work together as a team. Effectiveness comes

from the ways in which the group members work with each other, as well as

from the way that individuals perform their own job. A task of management

should therefore be to develop an effective team, not just effective individuals.

A useful way of comparing these two approaches might be to think about a football

team or any other type of sports team. The effectiveness of the team depends to a

large extent on the individual talents and skills of the team members, and their

ability to perform the function for which they are in the team, such as goal keeper or

Chapter 8: Individual and group behaviour: team management

goal scorer. However, the team will not be successful unless its members can also

play well together.

 When team members do not work together well, the effectiveness of the team as

a whole is less than the effectiveness of each team member taken individually.

 When team members work well together, the collective effectiveness of the team

as a whole can be much greater than the effectiveness of each team member

taken individually.

The effectiveness of individuals is important. However, the effectiveness of teams

could be even more important.

1.4 The role of management in team building

A role of management is to provide leadership to teams and work groups, so that

the team is successful. More specifically, in addition to the more general tasks of a

manager, team management involves:

 Bringing together a suitable group of individuals to form the team

 Allowing and encouraging the team to develop

 Assessing the performance of the team and, where appropriate, rewarding the

team as a group for the performance it has achieved.

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Teams and team roles

 The differences between a work group and a team

 A successful work team

 Team roles: the ideas of Belbin

2 Teams and team roles

2.1 The differences between a work group and a team

For the purpose of your examination, you should make a distinction between a

work group and a team. A team is a work group, but not all work groups operate

like a team.

A team is a work group in which the team members work effectively together, and:

 all the team members identify with the team and see themselves as part of a

team, and

 the team reaches decisions by agreement and consensus.

Decisions taken by a team have the support of the entire team, which means that a

team cannot exist in a group where decisions are taken by the group leader

(manager or supervisor) and imposed on the group, whether the group members

agree with the decision or not.

 Since teams take decisions by consensus, it is impossible for large work groups

to act as teams. In a work environment, teams are often quite small.

 For a similar reason, it is difficult to build a team when the work group members

are spread across different geographical locations. Team members need to meet

and communicate on a regular basis.

Project teams

The word ‘team’ may be used to mean a project team. A project team has the

following characteristics:

 A project team is created to perform a specific task, and is then disbanded. The

team is often made up of individuals from different functional areas of the

organisation (the team is ‘multi-disciplinary’).

 Other work groups are more permanent, and are established to fulfil specific

roles. They may be organised by function (for example work groups in

production, in marketing, in accounting, and so on).

Chapter 8: Individual and group behaviour: team management

2.2 A successful work team

A successful work team has several characteristics. Some of the characteristics of a

successful team apply to effective work groups in general. Others relate more

specifically to teams.

 The team should have a clear purpose.

 Its area of authority should be clearly defined. The team members should know

what they can do, and what they do not have the authority to do.

 The team should have effective leadership. One of the tasks of the team leader is

to create an effective team: team leadership skills are therefore essential.

 If the team is a project team that is required to complete a specific task, there

should be a clear time scale for completion of the task.

 The team should be given the resources that it needs (equipment, materials,

money) to complete its tasks successfully.

 The team members should have the necessary skills or experience to complete

their task successfully. Every individual does not need all the necessary skills;

however, collectively, the team members should have all the skills, expertise and

experience required.

 The team members should have the motivation and commitment to achieving

the objectives of the team.

 There should be good communications between the team members. There

should be an effective and rapid exchange of all relevant information.

 Each member of the team should perform a role that adds to the effectiveness of

the team. The role of team members is partly to carry out technical or

operational tasks. Team roles are also concerned with adding to the effectiveness

of the way in which the team functions as a unit. Team roles are described

below.

 There should be strong team loyalty and good teamwork. Morale or team spirit

should be high, and there should be respect for the team manager.

 The work of the team should produce benefits for the business. Providing

benefits to the business is essential, because this defines ‘success’.

2.3 Team roles: the ideas of Belbin

An important contribution to ideas about the management of teams was made by

Belbin. Belbin studied the behaviour of individuals in teams and the ‘team role’ that

each individual plays. He defined a team role as ‘our tendency to behave, contribute

and interrelate with others in a particular way’.

He suggested that in a successful team, the team members should have a balance of

certain behavioural skills. He identified nine types of behavioural characteristics

that team members should have between them. (An individual may have more than

one behavioural characteristic, which means that a team can possess all nine

characteristics without the need for nine team members.)

The nine team roles are grouped into three broad groups:

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 Doing/acting. Some team members are good at getting things done. When they

see what needs to be done, they do it or encourage others to do it.

 Problem-solvers and thinkers. Teams are often confronted with problems and

difficulties that need to be resolved. Some team members need to be good at

finding answers to problems.

 Showing concern for people. A team is a group of individuals acting together in

a work environment. A successful depends needs members who have skills in

bringing the team together, by showing concerns for others, by helping others or

through communicating well with others and showing a concern for the team as

a unit.

The nine team roles are as follows.

General nature

of the role

Team role

Description

Doing/ acting Implementer

A well-organised and predictable person. He

takes basic ideas and makes them work in

practice. However, he can be slow.

Shaper

A person with energy, and full of action. He

challenges other members of the team to move

forward and make progress. However, he can

be insensitive to the feelings of others.

Completer/

finisher

A person who is reliable in seeing a task

through to the end and getting it finished. He

sorts out minor problems and makes sure that

everything is working well. However, he can

worry too much and may not trust other

people.

Problem

solving/

thinking

Plant A person who solves difficult problems with

original and creative ideas. However, he is a

poor communicator and may ignore details.

Monitor/

evaluator

A person who ‘sees the big picture’. He thinks

accurately and carefully about issues.

However, he may lack energy and an ability to

inspire other people.

Specialist A person who is driven by a pursuit of

knowledge and information, and wants to go

into detail. The ‘specialist’ role is a behavioural

characteristic rather than functional specialism.

However, he becomes an expert in some key

areas and will solve problems in those areas.

He may be disinterested in all other areas of

the team’s activities.

Concern for

people and

feelings

Co-ordinator A respected leader who helps everyone else in

the team to focus on their particular tasks.

However, he may be seen as wanting to

control things too much.

ACCA F1 Accountant in Business - 2010 - Study text - Emile Woolf Publishing

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