Introduction

Leadership is one of the most important factors that lead to success of company. In this assignment, we will analyze leadership style of AirAsia CEO, Tony Fernandes. AirAsia is a low-cost airline company in Malaysia with a vision to make it possible for all people. Managing an airline service was a dream of Tony when he was young. Therefore, purchasing AirAsia give Tony chances to follow his passion. Under his management, a heavily indebted company as AirAsia broke even within one year. Nowadays, it become the largest low cost airline service in Asia.

2.1 Explain the skills and attributes needed for leadership

2.1.1 Leadership

Leaderships are individual that lead the organization and bring his subordinates together and guide them to a specific goal. They can establish a clear vision so that anyone can follow. Additionally, they can also provide methods, information and knowledge to guide employees to the vision. Moreover, with the help of leadership, interest conflict among stakeholder will be coordinated and balanced.

For example, when Tony Fernandes purchased AirAsia, it was heavily indebted company of Malaysian government with only two air craft. Under Tony’s direction and management, company had changed to target low cost airline market segment. As a result, within one year company was cleared all debt and break even. Nowadays, AirAsia has become the largest low cost airline in Asia and serving more than 3 billion customers.

2.1.2 Skills and attributes needed for leadership

Skills for leadership

Decision making skill: It requires a leader to have appropriate decision in any situation that business face. Leader’s decision have great impact on operation of company which could lead business to success or failure. For example, it was not beneficial condition when Fernandes purchase AirAsia in 2001. However, he decided to take risks to enter the market. Due to the fact that he realize potential to develop low cost airline service in Asia.

Problem solving skill: A leader must have ability to handle or solve problem accurately and rapidly whenever there arising issues during the operation of business. A leader also need to act immediately to take advantageous opportunity to solve the problem. For example, recently AirAsia had faced serious airline accident which lead to death of 162 people. Tony has actively condolences to the families of the victims and ready to cooperate with authority to solve the problem.

Motivation skill: Leader must have ability to encourage their subordinate to accomplish the task. Rewarding or encouraging will be the best motivation for employees to work better. When arising issue during operation of business, leaders should guide and inspire employees solve the problem. For example, there is incentive system in AirAsia in which employees are provided free flight and discount for trip, and share for loyal employees. These motivation will encourage employees to put more afford on work.

Attribute for leadership

Industry Knowledge: leaders are person that have deep knowledge about their business field which includes the informations such as product line, trend, target, competitive advantages… These information

will be useful for company in case of facing threats or crisis so they can propose appropriate method to eliminate risks. Example: Tony has deep knowledge about business field. At the beginning, he realized potential to penetrate new market segment thus he decided to buy AirAsia. During a course of develop, he also propose many innovative ideas to improve services.

Confidence: It require leader to be assertive person who does not afraid to be fail so that they can make decision on their own though and cannot be affected by other people disagreement. It also help leader to eliminate barriers of anxiety and worry. For example, Tony Fernandes was a brave person when buying AirAsia with a debt of 11 million dollar and probability to profit was not positive. However, he dared to take risk.

Human Resources: Leaders are person that can identify the capability of employees and assign them in a suitable task for smooth performance. Arranging right position will help employees have chance to perceive and improve their skill. There is an example that one air attendant asked Tony whether she become a pilot. He then encouraged her to pursue her dream and replied that Tony would hire her if she qualify. Finally, she did and became a first fulltime pilot for AirAsia. This mean that Tony can realize potential of that attendant and give her opportunities to grow.

2.2 Explain the difference between leadership and management

Management is used to make sure that a business or organization can run smoothly throughout instant and near future. Managers are responsible for making decisions which have effects on every level of a business. These decisions could be recruiting new staff or having a company run. For example, in company manager will be in charge of doing stuff that make business run smoothly such as setting out a plan, managing and monitoring the process of project. Manager can manage all departments of company or just a specific department.

	Management	Leadership
Activities involved	Planning and budgeting: A manager is responsible for creating plan for implement project or employees task. They also manage the budget for the project. Example: In order to rise fund for AirAsia, Tony Fernandes had to mortgage his house and use his saving to ensure company operation. Organizing and staffing: Manager account for organizing work which enable different department work together. They also need to manage their followers to that they can understand and arrange suitable position based on employees capacities.	Creating a sense of direction: Leaders must be able to guide business into specific direction so that subordinate can follow to achieve goal. For example, Tony Fernandes has driven AirAsia into low cost airline service after purchasing it in heavily-indebted position. Communicating the vision: The vision of leaders is shared to spread out the opportunities and changes that organization will acquire. Thus employees will know what they need to do and follow.
Mindsets	Controlling and Problem Solving: It requires managers to have thought of controlling and problem solving so that they can manage and eliminate arising problems. Example: For air crash accident, Tony Fernandes actively condolence victim’s families and always cooperate to solve problems. Circles of power: it also require manager to create circle of power in order to manage business well.	Inspiring and motivating: Leaders must be a person that inspire and motivate their subordinates by attitudes, speeches and incentives. This will create motivation for employees to follow and work. Example: Employees at AirAsia are motivated by free flight, vacation discount and share. They are also inspired by intelligence and modest of Tony Fernandes. Circles of influence: instead of creating circles of power, leaders need to enhance their influence over employees.
Skills needed	Counting values: Manager should focus on counting value instead of adding it to manage employees. Managing work: manager must have ability to control followers or groups of entities.	Creating values: Leaders focus on creating value for their business and employees. Managing people: leaders refers employees ability to impact, encourage and enable them to contribute for company.

Example: Tony Fernandes appreciate contribution of his followers by stating that AirAsia is grown by all company staff, everybody contribute their ideas, find innovative method to increase effectiveness, improve company services by efficiently utilizing technology with personal touch and excellence marketing as well.

2.3.3. Compare these styles in terms and evaluate its effectiveness in responding to different situations

In responding to different situations, leader with dictatorial leadership style will posse all decision making power. Subordinates are not allowed to question, make mistake and authority. Dictatorial leader expect employees to have high performance all the time. With dictator, mistakes are unacceptable and result in punishment or fined.

Example: Terry Gou believe that leader must be a dictator to have ability to keep benefit of company. He expect and appreciate all followers to contribute all energy to company. Employees must follow all command from leaders, commands are considered as main connection method. Employees are like army forces, they just need to implement leadership’s command without thinking, question and authority.

In responding to different situations, leader with democratic leadership style will share decision making power for followers. They also promote employees’ interest and applying social equality which make them feel engaged to company.

Example: Tony Fernandes has develop a working environment where employees can self-improve, learn and carry out assigned tasks within company. Employees are encouraged to follow their passions at AirAsia. In addition, he also change his job monthly to get different experience from different departments. Moreover, there is not bureaucracy in company so employees can meet Tony any time they want.

2.4. Explain ways to motivate staffs to achieve objectives

Empowerment stand for action that leader give employees right to make decision and they can decide on their own. For example, AirAsia employees are allowed to make decisions because they are considered as contributor of employees. Each individual is treated as member of big family and equally so that they can keep workflow running smoothly and productively.

1. Information

Leaders will give subordinates instructions, information that can guide employees activity or being used to evaluate working process as well. With information and instructions from leader or employees self-direction, they can work to reach proposes goals.

Example: Tony Fernandes know clearly about business’ information and environment which allow Tony to make appropriate decision. Therefore, it allow Tony to be the first person who entered low costs airline market in Asia. Moreover, he also proposed to develop many innovative concepts such as online booking, travel insurance and medical care … With the information Tony have, he can achieve company objective and goal.

2. Expertise

It also requires that leaders have deep knowledge about their business field. Leaders must have ability to set out routines for employees to solve problem. In case leaders lack of these ability, it required leader to have consultant or expertise to give better advice. Subordinates can try to be like what they observed or not.

Example: Tony have a deep knowledge about business field which allow him to analyze a lot of opportunities and changes. He was the one that penetrated new market segment and developed AirAsia as a largest low cost airline in Asia although the context was not good. With his expertise, Tony together with followers could analyze and manage opportunities.

3. Personality

One another aspect that can make positive effects to employees is leader’s personality. Leader with professional working attitude and behavior will develop good fame which attract employees. It also create respect and admiration among subordinates. Consequently, employees are willing to do what leader ask.

Example: Tony Fernandes is a sociable person. He public his phone number to all social media and advertised for his own company. Although Tony is CEO of AirAsia, he is still modest in front of others. Due to these characteristic and attitude, he gain admiration from employees. As a result, his subordinates willing to follow him to reach company objectives.

4. Moral power

It require to have an incentives system to encourage subordinates to work. Subordinates do what leaders require and instruct however subordinate can decide to follow the instruction or not.

Example: Employees are rewarded with free flights and 90% discount of vacation. This motivate employees to work harder to get rewards. In addition, Tony also reward his subordinates based on their contribution with Employee share awarding scheme (ESOS). He also award employees who work in company for long time.

Conclusion

In conclusion, the study showed skills and attributes for leadership. Moreover we can understand the differences between leadership and management so that we can compare leadership style in different situation. Finally, we can know the method that leaders use to motivate and inspire employees to reach company goal.

References

BPP Learning Media – Business Essentials- Course book Organization and behavior, Third edition July 2013, publish ISBN 9781445368207)

Business standard (2013), our model is straight forward and democratic: Tony Fernandes [Online], Available at < http://www.business-standard.com/article/companies/our-model-is-straight-forward-and-democratic-tony-fernandes-113062900437_1.html> (Accessed on March 20, 2015)

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WORKING WITH AND LEADING PEOPLE Assignment 2

Introduction