Developing Managerial Effectiveness

Many companies today are in deep trouble. Even global corporate icons across the globe were not spared from the financial turmoil. Here are some notable cases. Bear Stearns, one of the largest global investment banks had collapsed. The Lehman Brothers Holdings Inc, a global financial services firm with assets worth more than US$600 billion had filed for bankruptcy protection and making it the largest bankruptcy filing in US history. The Royal Bank of Scotland has to be bailed out by the UK government. In late December 2008, Toyota Motor Corp of Japan announced that it expected to suffer its first operating loss in 70 years amounting to US$1.7 billion.

While the US auto giants, General Motors and Chrylers are currently lining up for a second round of massive government aid of around US$20billion, Malaysia's budget airline, AirAsia, announced that that it had secured funding from Barclays Capital to finance the purchase of 15 new A320-200 aircrafts worth nearly US$700 million. Hats off to Datuk Seri Tony Fernandes and his management team as it is not easy to raise fund under the current worst conditions in the credit market. Another glimmer of light coming out of Malaysia is Public Bank Berhad. As the Malaysia's leading bank in terms of market capitalization, Public Bank Berhad achieved a record breaking RM2.58 billion in net profit as a result of a 22% growth in 2008.

Many factors, internal, external or a combination of both, contributed to corporate successes and failures. One critical factor is people with their passion and potential. All organizations have people in positions with management responsibilities to maximize resources and increase profits. While these managers are efficient, they may not necessarily be effective. According to William J Reddin (1970), "effectiveness is the extent to which a manager achieves the output requirements of his position". Managerial effectiveness has to be defined in terms of what a manager's achieves rather that what he does. Ineffective managers are those who failed to create an enabling environment for their employees, both individually and collectively, to achieve their potential.

The degree of success of a company is often attributed to leadership which sometimes, mistakenly refers to the top echleon of the company. However, leadership is only an attitude. Every employee, irrespective of rank and level, is a leader when he demonstrates leadership in a situation. There's no formal position of a "leader" in an organization but on the other hand, manager is a position. For a manager to be effective, he has to possess four essential leadership competencies - Thinking, Influencing, Achieving and Leading (acronym TAIL).

Thinking is how a manager makes quality decisions which will generate great impact. It involves the three different modes of strategic, innovative and critical thinking. Influencing is how a manager convinces others and enables them see what activities will provide the greatest leverage for improvement. It involves conviction, conversation and communication. Achieving is how a manager drives the achievement of goals and targets though strategic performance planning and measurement. Leading is how a manager creates an environment in which others can realise their potential. It involves the manager "walking the talk", being a role model and coaching others in attitude motivation, accountability, integrity and business ethics.

James Rieley sums it very well when he said that these four leadership competencies can either make or break a company. Therefore, managers should start demonstrating behavioral actions of Thinking, Influencing, Achieving and Leading to achieve a high level of managerial effectiveness.