Gail Kelly - Successfully combining leadership and management.

Gail Kelly - Successfully combining leadership and management.The role of a manager is to cope with the complexity of an on organisation or company, by practising task-orientated functions such as planning, organizing and controlling, dealing with interpersonal conflict, and working to achieve goals set by superiors by means of altering organisational structure (Hitt et al. 2007).  But while the role of a manger is largely procedural, the role of a leader within an organisation is to motivate and inspire subordinates, encourage commitment to or convince others of a vision, setting and guiding in direction, and promoting major changes in goals and procedures - an approach that is more “in touch” with subordinates, and thus equally as powerful as a manager (Davidson et al. 2009). But a question that has been frequently debated amongst scholars in recent years is whether or not a person can effectively fulfil both of these roles within an organisation (Hitt et al. 2007), or does it become natural for both of these roles to simply tie together within highly efficient and successful corporations? Gail Kelly, former CEO of St George Bank and current CEO of Westpac, models such initiative everyday in her managerial career, and undoubtedly proves to us that the previous statements are anything but false. By combining leadership and management in her career, it would seem Kelly has seen nothing but success – St Georges Bank shares soared by $100 million when Kelly was announced CEO, and she later went on to become, and still is, Australia’s highest paid businesswoman (Davidson et al. 2009 pp. 386-387). With that being said, if Kelly is an example to go by, management and leadership are both significant aspects of any highly successful organisation, especially when both are embodied by employees in managerial positions. If we draw on research of both leadership and managerial fields, it becomes clear that management and leadership complement each other throughout any organisation, to the degree that one isn’t as effective without the other. This is highly evident in comparisons between planning and budgeting against setting a direction, organising and staffing against aligning people, and controlling and problem solving against motivating people. Kelly has been able to effectively balance and embody all of these functions. However, while significance is placed on how leadership compliments management, it must be noted that there is a significant difference between the two. In order to be a good leader a person needs charisma - this cannot be effectively taught as it is a personality trait; while management is largely a taught process.  But when a person possesses charismatic leadership and effective management abilities, both aspects can be manoeuvred to work towards a similar goal: creating a highly efficient and successful organisation.

As CEO of a bank, planning and budgeting is an extremely significant part of Kelly’s career – without a plan, the bank will remain stagnated and would likely lose out to competitive corporations. Planning and budgeting involves understanding the environment that the organisation finds itself within, and finding ways to succeed and achieve goals within this setting. With a final goal in mind, it is the manager’s job to construct parallel streams of goals and plans that flow over a period of time. These objectives that work towards a successful final goal include tactical, strategic and operational goals – all of which relate to goals set within various sections of an organisation (Davidson et al. 2009). Clearly, planning and budgeting is a highly cumbersome managerial task; one that is difficult enough for a manager like Kelly to comprehend, let alone subordinate employees. Leadership compliments the unwieldy planning process by appealing to employees by setting a direction; it creates vision and strategies that seem much more attainable to employees than burdensome, yet necessary plans.  Rather than preaching a precise plan that must be adhered to on a daily basis, leaders promote a vision to their employees that is realistic but obtainable in the long term, and articulate a feasible way for them to achieve this goal (Kotter 2001). Such approach becomes very important in contingency situations, where if only managerial processes were adhered to, a significant portion of workers would become burdened and confused by sudden changes in plan – and in an instable economic environment like today, such changes could happen often. With leadership complimenting management, the awkward task of implementing contingency plans can occur with little impact on the employee. The manager/s, such as Kelly, would alter plans “behind the scenes”, while leadership would come into action to promote and phase in a change in strategy to its employees, rather than a confusing change in goal. In fact, Kelly heavily demonstrated this initiative and combination of management and leadership during her time as CEO of St George Bank. After taking over as CEO of such bank, Kelly maintained the company’s major goal of setting itself apart from other banks, but at the time deemed a change in strategy necessary in order to continue to work towards achieving this. Kelly was convinced that engaging customers would be crucial in achieving success, and thought the company’s history as a building society would only assist in this. On a managerial level, Kelly planned and budgeted for this change in strategy with a low risk organic growth approach, and as a veteran of more than 10,000 PowerPoint presentations to date, it is right to assume that such planning was largely complex and organised. But on a leadership level, she maintained the vision of St George Bank standing out amongst others, and promoted amongst her employees a change in strategy towards “customer satisfaction and delight” in order to achieve this. In doing so, it would seem employee confusion did not occur and various customer services, such as complementary briefings across the country, were implemented successfully – evident in the doubling of St George Bank’s share value in the six years Kelly, and her strategy, were with the bank (Davidson et al. 2009 pp. 386-387). With that said, it is clear that the combination of leadership and management processes by a person in a managerial role when planning for the future contributes to a highly efficient organisation, especially in the case of Kelly and St George Bank, which had a constant growing of share price under her reign (Davidson et al. 2009 pp. 387).

But while management processes are used by a person of such role to develop an organisation’s capacity to achieve its goal through planning, creating an organisational structure and set of jobs for accomplishing such plans requires organising and staffing. This involves the cumbersome tasks of employing individuals for the jobs that are qualified, communicating the plan/s to this newly formed group of people, delegating responsibility amongst this group for carrying out the plan, and statistically monitoring its implementation. Leadership compliments this management process by aligning these qualified people, rather than grouping them thoughtlessly (without consideration of group cohesion). This means aligning those who are able to create coalitions that understand the vision communicated to them and are committed to its achievement (Kotter 2001). “Managers “organise” to create human systems…choose a structure of jobs and…staff it with individuals suited to the jobs”, but don’t take into an individual’s compatibility with others as leaders do, who take the time to talk to each individual and see who “fit within a particular context” and thus would work together at upmost efficiency (Kotter 2001 pp. 90). During her time as CEO of St George Bank, Kelly combined these management and leadership processes in order to create her “fantastic team” of employees, who significantly contributed to the success of the company and her herself becoming the highest paid woman in Australia. Kelly pursued with, but did not limit herself to, the necessary management process of simply organising and thoughtlessly staffing, but rather continued on towards the leadership approach of personally identifying a selection of compatible employees who could work efficiently together in achieving the company’s goal; “to succeed, you need people who like other people, who are energetic, caring and positive and who aren’t arrogant or self-serving…creating a team…that likes working together… a team that delivers” (Kelly; Davidson et al. 2009 pp. 387). With that said, it is clear that Kelly takes great care in organising and staffing her employees for the good of the company and its vision, and this along with the evident success of the company, shows that Kelly’s embodiment of both managerial and leadership processes is a combination for success, in the very least in terms of creating a highly efficient organisation. “I like to achieve – I like to achieve quality outcomes” (Kelly; Davidson et al. 2009 pp. 387); and it is with such quality, handpicked groups of employees that she can effectively do so.



It is clear that managers attempt to do everything in their power to plan for the future, however of course not everything can go to plan. Excluding times of contingency which have already been discussed, other, and often more simple, factors can occur to cause a discrepancy within a manager’s complex set of plans and goals, such as employees not meeting targets. Managers attempt to ensure plan accomplishment by controlling and problem solving, which can involve analysing records from the monitoring of plan implementation by means of meetings, reports and other tools identifying divergence, and then if problems arise, the unwieldy tasks of planning and/or organising are used to “solve” the problem. Rather than this principally technical approach, the leadership process is a more personal approach which appeals to motivating and inspiring; keeping people moving in the direction of the company’s vision, despite any major obstacles such as contingency changes, by appealing to simple but often untapped human values, emotions and needs (Kotter 2001). Control is enormously central to management, however effective leadership in regards to motivating and inspiring seemingly alleviates this control in the eyes of the employee, to the degree that rather than feeling like a no-named, over controlled employee, they feel a sense of belonging, recognition, a feeling of control over one’s life, and importantly, the ability to live up to one’s ideals (Kotter 2001 pp. 93). Even more importantly, in return, the employees will regard the organisation in a much higher manner, and in turn will wish to contribute to it as effectively as possible. Ways in which managers can motivate and inspire individuals include communicating the organisation’s vision in a manner that stresses the value of the audience they are addressing (thus makes the work important to those individuals)(Kotter 2001), and regularly asking for feedback from employees in regards to ways in which the organisation could go about achieving its vision, thus giving him/her a sense of control. In fact, according to a recent survey, 74% of executives claim that, compared with the past, they are now more concerned with empowering employees in this way, because “total power in the organisation seems to increase…contributing more to organisational goals” (Samson & Daft 2009 pp. 558). When Kelly was CEO of St George Bank, it is clear she employed both managerial and leadership techniques in solving the problem of employee motivation. While no explicit evidence is available to show Kelly’s use of employee monitoring, from her highly organised status of “10,000 PowerPoint presentations”, and fussiness over her selection of her “energetic, caring and positive…aren’t arrogant or self-serving” group, we can fairly assume she would go to such lengths as monitoring to maintain the integrity of her “fantastic team”. In addition to this, Kelly states “creating an environment where people can do their best work” (Kelly; Davidson et al. 2009 pp. 387) – any environment that is “created” needs to be maintained to some degree, especially when it impacts the efficiency of all workers within a group. On the contrary, plenty of evidence is available to prove that Kelly is a motivational leader, too. This includes the use of inclusive language by Kelly in public statements regarding members of the company; “there are not many things WE can’t do” (Kelly; Davidson et al. 2009 pp. 387) – the use of “we” suggests all of the bank’s employees are important, not just the top executives, encouraging employees to feel a sense of belonging. In addition to this, Kelly is extremely enthusiastic about her company, for example “It’s incredibly exciting… I love it!”, and powers a team that “has fun”; (Kelly; Davidson et al. 2009 pp. 387) both of which could raise the morale of employees in any workplace, and thus encourage efficiency and positive employee-employer relations. With that said, it is clear that Kelly embodies both leadership and management processes in creating her motivated workplace, which surely contributes to the highly efficient style, and success, of her entire organisation.

With this in mind, and using the previous examples, it can also be suggested that Kelly is directly influencing organisational culture through these managerial and leadership processes, and thus is taking as much control as possible of her organisation’s internal environment. In doing so, Kelly is promoting a positive, motivated and “fun” environment which if built up strong enough, will be able to “repel” various negative forces which may come from the external environment in the future, thus reducing the need to instantly resort to contingency approaches (where plans allow) during bad times. Such is the thinking of both a manager and a leader – setting up a good foundation for the organisation’s plans, and fortifying employee motivation towards the company’s vision; “. . . the unique and essential function of leadership is the manipulation of culture."- Edgar H. Schein (Trice & Beyer 1991)

While significance has been placed on how leadership compliments management throughout this discussion, it must be noted that there is also significant difference between the two. Findings from studies in 1977 by Robert House into managerial leadership suggest that the strongest leaders within organisations possess charisma; a form of interpersonal attraction that inspires support and acceptance (Davidson et al. 2009). If this is true, someone with charisma is more likely to be able to influence others than someone without charisma. In regards to organisational leadership, a charismatic leader is said to inspire followers, have a high level of self confidence, strong belief in own ideas and should demonstrate self-sacrifice towards the organisation as a role model to others (Hitt et al. 2007). When Kelly was CEO of St George Bank, she demonstrated these charismatic traits and more. As a mother, Kelly had to sacrifice time with her children to be in the workplace, she had a strong belief in her strategy of customer satisfaction which led to success, and definitely had a high level of self confidence – “there are not many things we can’t do” (Kelly; Davidson et al. 2009 pp. 387). However, while charisma is an important trait of a good leader, as it is a personality trait, it can’t effectively be taught to those without it. While managerial skills are the opposite, they are largely a taught process, of which Kelly appears to have a high level of ability of too, as evident by her rapid rise through many company’s managerial spheres, and the confidence that investors had in St George Bank after she became CEO (Davidson et al. 2009).

In conclusion, Gail Kelly rose to become Australia’s highest paid businesswoman, and ranked the world's 11th most powerful woman by business journal Forbes (The Canberra Times 2008), by combining management with leadership throughout her career. In doing so, she was able to transform St George Bank, and other corporations, into highly efficient and malleable organisations. Kelly’s management skills provided her with the knowledge to build the complex framework of each organisation she took control of, while her leadership skills and great charisma allowed her to guide her employees through such seemingly unwieldy framework towards achieving a common organisational vision, and developing compliant strategies to do so along the way. As a closing comment, it is important to note that while both management and leadership abilities helped Kelly achieve great success, neither can help more than the other – a manager who focuses more on management processes than on leadership risks being out of touch with their employees who will lack motivation as a result, while a manager who focuses more on leading will run the risk of having the very foundation that supports management structures slip out from beneath him/her. If anything should be emphasized in this entire argument, it is that management and leadership exist as perfect compliments of each other, and it is this perfect combination that allows people like Gail Kelly to achieve financial success to the greatest of heights.


References

Davidson, P., Simon, A., Woods, P & Griffin, R., 2009, “Gail Kelly, bank executive – outstanding leader and manager” in Management: Core Concepts and Applications, 2nd edn, Milton, Queensland: John Wiley & Sons:  pp. 386 – 388.

Davidson, P., Simon, A., Woods, P & Griffin, R., 2009, Management: Core Concepts and Applications, 2nd edn, Milton, Queensland: John Wiley & Sons: Chs 8 & 11.

Hitt, M.A., Black, J.S., Porter, L.W., & Hanson, D., 2007, Management, Chs 10 & 11.
pp. 390 pp. 389

Jago, J.G. 1982, “Leadership: Perspectives in Theory and Research”, Management Science, Vol. 28, No. 3 pp. 315-336. Available from: JSTOR [23 March 2009]

Kotter, J.P., 2001, “What leaders really do”. Harvard Business Review, Vol. 79, No. 11, pp. 85-96.

Samson, D., and Daft, R.L., 2009, Managament, 3rd edn, Frenchs Forest NSW: Pearson, Chs 1 & 15.

Trice, H.M. & Beyer, J.M., 1991, “Cultural Leadership in Organizations”, Organization Science, Vol. 2, No. 2 pp. 149-169. Available from: JSTOR [24 March 2009]

29/08/2008 Kelly powers past Oprah, The Canberra Times. Available from: <http://www.canberratimes.com.au/news/local/news/general/kelly-powers-past-oprah/1257296.aspx> [25 March 2009]

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