Developing leadership and Global Recession Essay

Developing leadership and Global Recession - Essay Example However, countries which are wealthy were able to cope with recession to an extent. According to AusAID(2010)â€Å"Those  with stronger economies and more financial resources  were able to implement effective policy responses to support the economy and weathered the global recession relatively well†. In combating a worldwide threat like global recession, an organization needs to make visible changes in their leadership styles and business strategies. The issue of global recession demands a leader to change his attitude in conducting business in order to be flexible and realistic. Global recession is a serious issue and threatens the financial structure of a company and its profitability. As per Sawan(2008) â€Å"A recession normally takes place when consumers lose confidence in the growth of the economy and spend less† . In such a condition the objectives and aim of a business needs to be revised and reconsidered according to the demands of the situation. Implicatio n of Leadership on Global Recession a) Autocratic Leadership: This is a leadership style in which the whole decision making process of the business is vested with a single individual. Here the whole group members in an organization are monitored by the autocrat leader. In the event of global recession, the leaders should make effort to increase the confidence of share holders along with motivating staff to achieve maximum profit returns. An autocratic leader has more visionary skills and can implement strategies with less time and effort as consultation with other employees are not required. As an autonomous authority, he can analyze the prospects of the product market and make alternative choices to increase the demand for the product. As per Kiselev(2007)â€Å"An autocratic leader likes to make decisions himself. This leader relies on personal experience and input he has sought, not the voluntary contributions of others†. This kind of leadership is not viable with global re cession concept as co-operation and co – ordination wit all employees can solely achieve long term success for business. b) Democratic Leadership: A democratic leader is one who considers everyone’s opinion and solution on a specific problem before taking a decision. In this kind of leadership, the leader conducts meeting with group members and discuss the complexities of the business in the event of economical downturn. The conclusions are drawn considering the suggestion of all mangers and experts in the organization. During a recession period, most of the organization cut off employees in order to reduce cost, so a declarative leader must plan with organizational heads to retain experienced and skilled employees and disown employees who are less productive. According to Hansen(2011,pg.268)â€Å" Democratic style displays the leadership strength of the leader and usually generates respect from the team member c) Laissez –faire Leadership: In laissez – faire leadership, the decision making power is least vested with a particular individual. The decision making authority is distributed among various employees of the organization and they have strong hold on the business activity of an organization. In times of recession, it will be valuable if many employees have freedom to exercise their power to take action on relevant areas of an organization. In recession period, the organization has to take instant decisions to