Individual Assignment, Theories of Management Essay

Individual Assignment, Theories of Management - Essay Example The first case study deals with the revival of Nissan from losing millions to making millions under the leadership of Carlos Ghosn. The second case study describes the leadership style of Andros Stakis, group-managing director of Stakis PLC, who almost put the entire company in risk. Case Study I - Nissan Nissan Motor Co., a Japanese automaker has been one of the largest car manufacturers in the world (Daily Markets). The company started losing its market share to another Japanese competitor Toyota since late 1970s and was suffering continuous losses since 1997 (INSEAD). In March 1999, Nissan had an alliance with French carmaker company Renault in order to bail out of their mountainous debt (Renault). In terms of strategy, it was a good M&A deal. Renault’s geographical market strengths were in Europe and Latin America where Nissan was weak. Similarly in case of organizational capabilities, upon the merger, Renault would gain access to Nissan’s engineering and manufactur ing know-how, while Nissan would profit from Renault’s marketing and design abilities (NY Times). Cultural clashes, different organizational behaviors and financial conditions of Nissan posed huge risks to the anticipated synergies from the merger. The casestudy reflects on the leadership style of the new COO Carlos Ghosn (le cost cutter) who made a clear agenda of the change that Nissan would go through in the years 1999-2001. In the first week itself, Ghosn made a number of significant changes such as incentive plans for his executive officers, new language policies and a committment to quit if profits were not achieved by FY 2001 (HBS). Ghosn’s leadership style in the case is called as dramatic, sel-sustaining, effective charismatic and focused. The company returned to profit by FY 2000 and had an operational profit of 4.5% by FY 2002. Case Study II – Stakis PLC The second casestudy discussed in the paper is that of Stakis PLC, a group of hotel and casino cha ins in UK. Headquartered in Glasglow, the company was owned and run by Reo Stakis who turned a lace business to a hotel and casino empire. Prior to the appointment decision of Andros Stakis as the new CEO, Reo led the diversification of group into casinos, pubs, hotels and restaurants. In early 80s, the hotel tycoon passed on his business to his son Andros when the company was in a transitionary landscape of the unstable external environment and mis-guided strategic direction. The company’s strategic and financial position was exposed to the downturn in economic climate of 1991. Despite induction of two established leaders, Sir Lewis Robertson and David Michels as Chairman and CEO respectively, the company started having debts as high as ?15I Mn in 1991. Upon a number of cost-cutting measures, divestures, new partnerships and ouster of Andros Stakis, the group had its first pre-tax profits in 1993. Hilton PLC bought the group in 1999 for ?1.2Bn (The Independent). Theories of Management – An Overview This section provides an overview of varios theories of management designed over the period of years to make effective judgements on business and processes: 1. Scientific Management Theory (1890-1940): From the need to increase productivity, Fedrick Taylor divised a body of principles that scientifically selected workers so that each each worker would be given the responsibility best