Free Essay on Leadership Styles within the FMCG Industry in Malaysia

Fast Moving Consumer Goods are defined as those commodities that producers sell quickly and at a very low price. Rapid and constant changes characterize the FMCG industry. Examples FMCG products are also known as CPG (Consumer Package Goods) processed foods, soft drinks, kitchen appliances, beers, milk, gum, over-the-counter drugs such as aspirin, and toiletries. As noted from the above examples, the FMCG products can include durable and non-durable goods only that the goods must be fast selling (Zineldin, 2014, p. 46). The FMCG products have several unique features which include; low price, recurrent purchase, short counter life, daily consumption, their involvement is low, high volumes of sales, high accumulation turnovers, small return margins, and have extensive circulation networks.

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The Malaysian FMCG industry is highly represented both locally and on the international level by various companies such as Pepsi, Dove, Oreo, Spritzer, Perfect Food Manufacturing, and Milo. Examples of large FMCG companies are Algen Distribution Sdn Bhd, Rich Source Enterprise, Madam Way Food Supplies, and Green and Natural Group of Companies among others (Islam & Ahmed, 2014, p. 81). The large companies such as supermarkets have chains of supply networks while other firms provide to private stores where the products are sold in wholesale or retail. The nature of the FMCG business is driven by making profits and most of the companies in the sector are privately owned. The FMCG businesses in Malaysia have been broadly grouped into three different large market sections which include; personal care, household care, and food and beverages (Habidin et al., 2012, p. 1).

The Meaning of Leadership

Leadership is the function or position of a person who directs or leads a group which in this case the leaders directs employees. Leadership defines the ability or power to lead other employees or staff members. Leadership styles are way and approach through which leaders provide directions, execute plans, and motivate workers. The overall performance of a leader within an organization plays a critical role in overall outcomes of the firm which can be success or failure of the company and also observes through ethical practices (Aronson, 2001, p. 255).

The traditional approach to leadership was always authoritative. The modern approach of leadership is softer, and the leaders have a closer relationship with employees. Two first traditional approaches to leadership were developed which are; transformational and transactional. The transactional model has established boundaries and goals within the organization that guide the workers and failure to comply with them resulted in punishments but those who outperformed others also received rewards in traditional ways. The transformational focused on the motivation of employees (Zhang & Fjermestad, 2006, p. 288).

As demonstrated by Ohio model of leadership, traditional leadership concentrated on the trait theory in which leaders can express themselves through communicating what they want to be done and why. Most traditional leaders had the same features which, and the most common trait of all was their meanness (Zhang & Fjermestad, 2006, p. 284). Even political leaders such as Hitler and Josef Stalin have been described as mean leaders but very useful in making sure that all tasks were completed. The traditional leadership qualities have been related to universal trait and traits such as decisiveness, confidence, and empathy made good leaders.

Similarly, new leaders have shown such traits of courage and determination but are required to be mean. Understanding the consequences of leaderships sand styles on the overall performance of the sector is vital since according to many researchers leadership is viewed as the fundamental motivating force to improving the outputs of the FMCG. Fast Moving Consumer Goods have been defined as the products with a quick shelf turnover at reasonably low cost and that which do not require a lot of time, thought, and monetary investment. An individual FMCG commodity records a less margin of profit, but when the amount of sales of the goods is enormous, the benefits accrued translates to a significant number of sales. Therefore, it can be argued that fast moving consumer goods illustrate a scenario of low margin and high quantity commerce. The sales of FMCG commodities across Asia are rapidly growing with countries such as Vietnam and China recording the highest growth rates.

Styles of Leadership

Several theories have been developed to illustrate the direction and management techniques that can be used to demonstrate the importance of effective motivational practices within the FMCG industry in Malaysia. Leadership styles have been applied for a long time and even in the present their offer a better approach to understanding the impacts of team leaders in the productivity of employees (Hu et al., 2010, p 348). It is important to note that an individual's leadership style is dependent on the integration of their values, beliefs, and preference with the norms and culture of the organization. An effective combination of the mentioned factors will inspire workers increasing the overall output (Boateng et al., 2015, p. 84).The different types of leadership styles include;

Autocratic Leadership Styles

The above style allows the leader to have complete authority over the employees. The team members are not given the opportunity to air their views nor can they criticize or oppose the ideas of the leaders (Hu et al., 2010, p. 344). A firm practicing this type of leadership in the FMCG sector in Malaysia has shown quick decision-making processes, but on the contrary, they have resulted to increased absenteeism by employees (Islam & Ahmed, 2014, p. 82). The style has only worked best for those organizations with hard working leaders following every detail (Men et al., 2013, p. 180). The good thing with this leadership style is that decisions are made quickly since the leaders are the ones involved in the process (Aronson, 2001, p. 244). On the other hand, employees do not have an independence which may affect their morale.

The Laissez Faire Leadership Style

In this type of style, the leader has total trust in the team members to performing the tasks without much supervision (Aronson, 2001, p. 245). The method gives the employees an opportunity to put forward their ideas and suggestions. The ideas may help the company since these employees know the market well as they are the ones going to the market (Men et al., 2013, p. 182). Mostly, it is the junior salespersons that are sent to the field to look for the market which gives then sufficient information that may help in making informed decisions in the organization (Hu et al., 2010, p. 344). The benefit with this leadership style is that the workers feel more responsibility due to the trust the management has on them which in most cases would result in more sales. Additionally, the employees get the chance to give suggestions based on their market experiences which help the organization (Islam & Ahmed, 2014, p. 83). On the contrary, some employee may become lazy there is minimal supervision.

Participative leadership style

The participative approach involves leaders inviting and encouraging employees to take part in the process of decision making even though the head makes the final decision. The leader also has the responsibility of guiding the workers on their tasks and the best way to perform them (Hu et al., 2010, p. 344). The benefit of this style is that it the employees are more motivated, satisfied and able to utilize their skills to the maximum (Aronson, 2001, p. 249). The approach is credited with creating a positive working environment and promotes innovation within the team (Men et al., 2013, p. 181). The leadership style motivates workers towards improving their overall performance. Their involvement in the decision-making process encourages healthy competition as employees strive to impress (Islam & Ahmed, 2014, p. 80). The decision process takes a lot of time since there are many parties involved, and thus it slows down the implementation process.

Bureaucratic Leadership Style

Bureaucratic leadership style is very strict as it only allows the leaders to adhere to and follow policies and rules of the organization. The leaders also ensure that the workers follow the procedures and norms of the company. Workers likely to get promotions are those adhering to the policies and rules of the enterprise (Aronson, 2001, p. 254). The approach is known to discourage creativity within the organization which has reduced its popularity with companies in Malaysia (Men et al., 2013, p. 179). The approach ensures that projects are completed on time as workers have to report to their superiors regularly (Hu et al., 2010, p. 346). The company rules are very strict which ensures that work ethics are always observed which promotes the corporate image of the organization. On the contrary, strict supervision and restrictions discourage creativity by the employees (Islam & Ahmed, 2014, p. 84).

Past Case Study: Leadership style, employee motivation, and commitment: Empirical evidence from a consolidated retail bank operating in a depressed economy

The nature of this survey was descriptive and employed the quantitative research design for analyses of the hypothesized relationship. Questionnaires were used for the data collection and utilized stratified random sampling. According to the data collected, motivation scored a mean of 3.32 while commitment recorded a mean score of 2.26 (Chipunza, 2011, p.8342). Laissez-faire style of leadership recorded the highest mean of 4.30 while transformational followed with 3.80 and transactional leadership had the lowest mean of 3.64 (Chipunza, 2011, p.8342). The average scores are indications that most managers practiced the Laissez-faire leadership behavior more than they did show transformational and transactional.

Theories of Leadership Styles

Several approaches have been developed that illustrates the different types of leaderships. These categories of leadership have been adopted several companies in Malaysia especially those in the FMCG sector of the countrys economy. These models include;

Transformational Leadership

Transformational leadership has been defined as the process that revolutionizes and transforms people. The process involves assessment of employees' motives, satisfying their needs, and lastly valuing their contribution to the business (Bass, 1997, p. 130). Therefore, transformational leaders improve the performance of the company and facilitate the accomplishment of the objectives of the firm (Othman et al., 2012, P. 249). One of the primary roles of transformational leaders is raising conscious of the group by appealing to higher moral values which include; equality, justice, humanitarian, peace, and liberty (Mohammed et al., 2012, P. 1). It motivates employees and improves their performance (Hin et al., 2012, P. 103). The disadvantage with transformational leadership is that the evaluation of performance may de-motivate those works that are not performing well (Aronson, 2001, p. 251).

Case Study: The impact of transformational leadership style on employee satisfaction

The case study adopted the quantitative research design and utilized structured questionnaires as the main source of primary data. The Study found out that the impact of transformational leadership on workers is positive. Regarding the individualized considerations the Pearson correlation was 0.829*, that for inspirational motivation wa...