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Leadership Character, Skills and Knowledge

Discuss about the Leadership For the Contemporary Organisation for Knowledge.
 

Leadership is an important aspect for the success of organizations. The effectiveness of a leader is demonstrated through the overall performance of the organization the effectiveness of organization teams as well as the availability of a sense of direction. Leadership is defined as the process of inspiring a group of people towards the realization of certain goals. Leaders create an inspiring vision and motivate their teams towards the realization of the vision. Leaders are known based on the special attributes that they possess their skills and knowledge. Business leaders such as Bill Gates, Steve Jobs and Zhang Ruimin are all known because of certain aspects regarding their leadership abilities. Zhang Ruimin is a Chinese Business mogul currently serving as the CEO of a Global brand Known as Haier Group. Zhang Ruimin has become widely known for his role in transforming a company that was in deep financial crisis into a competitive global home appliances and consumer electronics company ( Chen, 2016).  This report will focus on Zhang Ruimin as a business leader. I will analyze various aspects regarding his leadership

This is one of the most recognizable leadership traits. At the Time he became the General Manager of Heir Group, he had a strong vision of turning the bankrupt company into a top global enterprise. He believed that if he did not take the initiative of destroying faulty refrigerators, the future of Heir Group would be shattered (Wang, 2008).  

Although many had tried and failed to change the fortunes of Heir Group he was passionate about his ability to transform the company through the introduction of critical changes and reforms. His commitment to the course, especially quality management course has seen him take a leading role in major undertakings intended to promote and maintain the quality of Heir’s Group products (Gupta  & Wang, 2009).

Great leaders are judge based on the kind of decision that they make during times of crisis. His ability to make effective decisions aimed at the prosperity of Heir Group has been part of the reason for the massive success for the company. This attribute was witnessed when he instructed his employees to destroy 76 Refrigerators worth huge sums of money in order to secure a bright future for Heir Group (Kerfoot, 2011). 

He views change as an important aspect of organizations success. Upon assuming leadership of Heir Group he embarked on Brand building and several other changes in the company. His insistence on quality has always been focused on enabling his organization to meet or exceed the highest standards of quality. His inclination towards change has seen him successfully introduce product diversification into the company. He also introduced the Qingdao based company into the global market through the adoption of an internationalization strategy. Unlike other business leaders, Ruimin refers to his employees as entrepreneurs. This is a way of improving ownership of their organization (Leavy, 2016).

Leadership Character

Although he did not get an opportunity to attend university in his early days, Ruimin spent a considerable amount of time reading. He also enrolled for management course in his early days as an employee and went ahead to increase his knowledge by enrolling for a masters degree in Business Administration. He spends most of his time reading and has been described as the most read business executive. He has been influenced in his leadership journey by a wide range of individuals including Henry Mintzberg, Kelvin Kelly, and Don Tapscott (De Man, 2011).

His outstanding leadership skills can be seen through his steady rise to top leadership positions in a short period of time. His leadership skills have enabled him to introduce critical reforms and work closely with his employees to turn the fortunes of Heir Group.

Born in 1949, Zhang was swept by China’s Cultural Revolution that aimed at preserving the country’s communist ideology. Having missed a chance to attend university, his thirst for education was compounded. His rise to leadership can be partly attributed to the acquisition of management skills through education (Zhang & Alon, 2009).

Past failure of the management of Heir Group especially their failure to address quality related issues that had almost collapsed the company also provided a turning point in his leadership career. The management of the indebted company out of financial crisis and making it a top global brand has provided him with an opportunity to provide leadership hence improving his leadership skills.

After failing to attend school in due to the prevailing circumstances in his country such as the shutting down of almost all universities in the 1960’s and equipped with a great sense of cultural experience Zhang Ruimin began his career at a little known state-owned construction in Qingdao in the years 1968.While working at the construction company his thirst drove him to start attending management classes in between his working shifts. Determined to improve his abbreviated education, He would cycle to and fro for classes on daily basis. Apart from attending management courses he also read widely and wildly on his own (McDonald, 2012). One of the main attributes that drive him today is hard work. After a few years of hard work at the Construction Company, he slowly but steadily began rising the hierarchy of leadership. He was first promoted to be the Company’s workshop director and later became the Company’s Deputy Director in 1980 after serving for 12 years (Lewin, Välikangas & Chen, 2017).  After two years of serving as a deputy director, he was promoted be the deputy manager of the division of Household Appliance. While working as the deputy manager of the Qingdao Refrigerator Plant that was then in a deep financial crisis he was instructed to look for General Manager for the company. The company had more than $10 million in debts and was on the verge of bankruptcy. For that reason, no one was willing to take up the role of General Manager after the former manager had left the company. The turn of events forced him to take up as the general manager of the company (Xing, 2016).

Skills and Knowledge

In his early years as the general manager, he noted that the company had a major problem with its reputation and quality of products that had resulted in numerous complaints from clients. This realization compelled him to establish a concept of quality among his workers through a demonstration using some of the company’s faulty products (Yu, 2014).His action was compelled by the returning of a faulty refrigerator to him by a customer. In the process of looking for a replacement for the customer, he discovered a 20% failure rate among the Refrigerators. His demonstration involved instructing employees to destroy 76 faulty refrigerators into pieces using sledgehammers (Bell, 2008).   He also took a leading role in the destruction process upon realizing that employees were reluctant due to the high prices for the refrigerators. This his most widely known leadership initiative that resurrected a struggling company. He also instituted major reforms that saw the company sales rise in the next year after taking over the leadership. The company changed its Name to Hier Group in 1991 and named Zhang Ruimin as its CEO in 1993.Haier group is currently rated as World’s best white Goods Company (Wei, 2009).

Through his leadership journey, it can be noted that his leadership skills were developed through concerted efforts to learn and acquire education as well as through determination and hard work.

Zhang Ruimin uses a wide range of leadership methods including transactional leadership, transformational leadership, and charismatic leadership.

Charismatic leadership is said to exist where a leader is followed without reliance on external authority or power. A leader is followed based on their persuasiveness and charm. Ruimin used charismatic leadership to change the status of a bankrupt company by setting standards and being the first to enforce them. Through his action of destroying faulty, he showed a degree of commitment to the quality course. He has successfully rallied his employees behind him to change the status of a failed company into one of the most successful. His charismatic leadership approach also enabled him to get rid of middle management and organize the huge number of employees working For Heir Group into 2000 teams managed by employees themselves. To each of this team, he has assigned unique roles (Cossin & Hwee, 2016). 

Transactional leadership is focused on organization, supervision, and performance. A transactional leader uses both rewards and punishments for employees to enforce compliance. Ruimin also uses this style of leadership in his roles as the leader of Heir Group. The most notable incident was when he led his employees to destroy faulty refrigerators. He directly took part and supervised the process and put on display one of the sledgehammers used in the Refrigerator destruction process (Waddell, Cummings & Worley,2011).Through this action, he was focused on turning around the fortunes of the organization, promoting compliance to quality standards. He also supervised the entire process. His transactional leadership attributes are also demonstrated in his attachment of pay scales for an employee to products they have produced. He introduced the company’s reward and punishment system in order to improve the performance of his employees. He also instituted a rule that required an employee who made an error to stand in front of other employees and explain it (Zong & Ping, 2015).

Impact of past failures

A transformative leader works closely with their employees to identify organizational areas where change is required and lead through the change process to achieve the desired change. Through transformational approach, a leader creates a vision for the change process and inspires subordinates to implement the change. (Wang, 2008). Because of his transformational approach to leadership Ruimin has gained the absolute trust of Heir’s group for the long period he has been at the helm of the Company’s leadership. He has also been able to instill important attribute of vision among his subordinates.

Conclusion

In conclusion, Zhang Ruimin is a classic example of a successful business leader. Over the years, his rise to leadership has been quite remarkable. It has enabled him to join the list of most effective leaders in business. He learned his leadership skills both through learning and practice. His role in the Haier group in the many years that he has worked there has been quite commendable. He is both a visionary and change-oriented leader. He is also committed, passionate, a good decision maker and a widely read leader. He uses transformational, charismatic and Transactional models of leadership.

References

Bell, S. (2008). International brand management of Chinese companies: Case studies on the Chinese household appliances and consumer electronics industry entering US and Western European markets. Heidelberg: Physica-Verlag.

Chen, J. (2016). Haier Is the Sea: CEO Zhang Ruimin's Innovative Management. Management and Organization Review, 12(4), 799-802.

Cossin, D., & Hwee, O. B. (2016). Inspiring stewardship. Hoboken : Wiley

De Man, H. (2011). Chinese philosophy as a mirror for western leaders. The Maastricht School of.

Gupta, A. K., & Wang, H. (2009). The rise of global champions: impact of country, industry & company effects. Indian Journal of Industrial Relations, 115-126.

Kerfoot, K. M. (2011). Direct decision making vs. oblique decision making: which is right?. Nursing Economics, 29(5), 290.

Leavy, B. (2016). The next wave of global disruption and the role of China’s entrepreneurs. Strategy & Leadership, 44(3), 27-37. 

Lewin, A. Y., Välikangas, L., & Chen, J. (2017). Enabling open innovation: Lessons from Haier. International Journal of Innovation Studies, 1(1), 5-19. 

McDonald, P. (2012). Confucian foundations to leadership: a study of Chinese business leaders across Greater China and South-East Asia. Asia Pacific Business Review, 18(4), 465-487.

Zhang, W., & Alon, I. (Eds.). (2009). Biographical dictionary of new Chinese entrepreneurs and business leaders. Edward Elgar Publishing.

Zong, R. and Ping, P. W. (2015) ‘On the Awkward CSR Status of Chinese Household Appliance Enterprises-Take a Case of Haier as Example. International Business and Management

Waddell, D., Cummings, T. G., & Worley, C. G. (2011). Organisational change: Development and transformation. South Melbourne, Vic: Cengage Learning.

Wei, Z. (2009). Zhang Ruimin: Awakening the Sleeping Dragon. ENTREPRENEURIAL COURAGE, AUDACITY AND GENIUS, 98.

Xing, Y. (2016). A Daoist reflection on sea-like leadership and enlightened thinking. Management and Organization Review, 12(4), 807-810.

Yu, F. L. T. (2014). Entrepreneurial leadership, capital structure and capabilities development of the firm: the case of the Haier Group. International Journal of Economics and Business Research, 7(2), 241-255.

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