An effective leader needs to master the art of influence. They should have the capability to inspire their followers to work towards the goals that they desire to achieve. However, there are different styles of leadership and everyone who deems him or her good leader ought to be able to decide which method best works for them and their situation efficiently. Leadership has been defined as a process of social influence that has the leader seeking to ensure that the subordinates participate voluntarily towards the achievement of specified goals (Bunni, 2007). A leader then becomes a person who can influence and delegate to others towards meeting an objective (Mullins, 2004). The organizations of today require specific skillsets and abilities in a leader. Such individuals in leadership need a deep understanding of the complexities of the globalized business environment. Additionally, they need to master the rapidly changing dynamics in the market and establish firms that are adaptable and receptive to positive changes. Styles of leadership can be divided into two main groups, transformational styles of leadership and transactional.
Transformational styles deal with the development of the followers and their needs. The logic behind it is that if they were content, then they can offer their best services and an organization thereby benefits. Managers who adopt this type of leadership will zero in on their employees, developing value systems that work best for them, inspiring moralities and providing opportunities for them to use their abilities (Ismail et al., 2009). The aim of this kind of leadership is to change the minds and hearts of people to larger understanding and visions, which makes their behaviors permanent (Bass, 1997). Transactional leadership deals with the relationship between the leader and the follower. The member is compensated for meeting a particular goal or criteria (Trottier et al., 2008). The leader first establishes a good relationship between performance and reward then encourages subordinates to improve how they perform (Bass, 1997). It motivates the led through awards, enforcement of rules and corrective actions.
Regardless of the style of leadership that one chooses, it is clear that the relationship between the commitment of subordinates and their satisfaction with the job will remain relevant. It is true therefore that the style of leadership will affect the quality of work. Entrepreneurs need to understand the concepts of leadership if they are going to maintain their businesses. There exists no single definition of entrepreneurship as many definitions depend on the person that offers it and the perspective from which they define it. Some researchers view entrepreneurship from sociology, psychology or even economics while others insist on seeing it as a management practice. It is thus a concept with many dimensions (Bula, 2012a).
According to Bula (2012), the first economist who mentioned the importance of the entrepreneur in the economy of a nation was Richard Cantillon. He saw them as responsible for all circulation and exchange within the economy. Say (1955) compared the entrepreneur to the landowner or ordinary wageworker and established that he does not receive a fixed profit, which results from his ability to bear the risk. Onuoha (2007) defined entrepreneurship as starting new organizations or bringing life to ones that are already in existence especially by focusing on available opportunities. This definition is similar so much to Schumpeter’s (1965) definition of who an entrepreneur is. He said that a person with an entrepreneurial mind would exploit opportunities that are in the market for proper use of their technical knowledge or innovation. All through literature, even though researchers may not agree on the definitions of entrepreneurship, they agree that it is an endeavor rooted in risk taking. The place of innovation is also widely recognized mainly with respect to opportunities.
Entrepreneurship is about taking risks, thinking creatively to come up with innovation that will meet a certain need. An entrepreneur will produce something that is recognized around the opportunities that can be seen taking on the failures and risks involved. However, the concept of entrepreneurship will vary with different geographical locations. An entrepreneur will embody the values that are in their national culture. Hofstede explained this under cultural dimensions claiming that the culture will emphasize the values of the initiative and achievement of people. In this sense then, entrepreneurship will be affected by changes today such as globalization. Cultures that are high on for instance collectivism or power distance would then mean that they have low levels of entrepreneurship while those with high individualism and low power distance would have more entrepreneurs such as the United States.
The concept of success is one that has eluded many. Many others have also written on the subject, as it is such a coveted place to be successful. As a result, almost everyone wants to be counted among those who know success. However, like many other terms, coming to one universal definition of the same has proven to be an uphill ride. Concerning entrepreneurship, it is no different regarding an agreement. Whenever someone oversees the institution of an organization, it follows that he or she will assume the responsibility of leading the enterprise further into the direction that the individual deems fit. This means that the person should have qualities that are special to them, as they will be pushing economic activities within cultural and sociological functions. These qualities will have a lot to do with leadership and the style that the individual chooses to adopt for use.
The person can be seen as having freedom to choose whichever activities to engage in and yet the importance of the choices of the entrepreneur to the development of a nation economically cannot be overstated. They are particularly imperative in making use of natural resources, mobilizing capital, creating markets in which they can carry out their businesses and developing or overseeing innovation. As has been argued earlier, the contribution of entrepreneurs can spell the difference between a prosperous and a weak nation. In this regard, a successful entrepreneur will be one who does as appertains to entrepreneurship. He will be aware of the new changes that take place in the society around him, and he will have a strategy ready to adapt to and to meet the morphing needs of the society in which he operates. All factors of production such as the techniques involved and the resources used will revolve around him and his ability to make use of talent to drive transformation and resource use into profit.
Successful entrepreneurs have been the butt of many types of research and the personality that they possess has been a muse for more. Success in entrepreneurial ventures has been associated with traits like confidence, versatility, optimism, persistence, creativity and calculated risk taking. It is clear thus that one can be an entrepreneur, that is, they can have their own business, but it is only if their achievements in the field that they do business are significant that they will be considered successful entrepreneurs (Mallya, 2011). They have to be able to make decisions that are weighty and could mean the death or the growth of their businesses. Decision-making is the ability to look at the alternatives that are available and make the right call. These choices are made based on the personal values as well as the organizational culture and the external environment influences as well. For one to choose, there have to be choices. The entrepreneur must therefore also be able to identify the opportunities that they have before selecting in accordance with their objectives and goals (Harris, 1980).
Baker et al. (2002), argues that the process of making choices or decision starts with identifying the parties who are involved in the decision so that one can reduce the possibilities of an argument when the choice is made. They then need to be able to establish what is required, to meet which goals and the criteria to be used. The general decision-making process will then proceed which is divided into some steps. The first stage involves identifying the root cause of the issue or flagging out the problem. This means that the causes of the problem will be established, the assumptions that are made therein, and the boundaries involved have to be set. The goal of this step is to be able to express the problem as simply as possible stating both the situation as is and the desired one. This process may take long, but it is as necessary as any other process involved in the course of deciding. If it is executed correctly, the statement of the problem will not be ambiguous.
The next step involves determining what is required so that the problem can be met. Conditions that are acceptable must be established and stated quantitatively so that debates that may follow are preempted. After this, the goals are set up in a broad statement that will give what is intended, the desires and the wants. They can be conflicting in nature, and that is acceptable at this stage. Identification of the alternatives that exist and the approaches that they offer is the fourth stage of proper decision-making. The alternatives that are identified must all be able to meet the requirements that were set at an earlier stage. The next step involves setting the criteria, which will help to discriminate between the alternatives that are available, based on what one wants to achieve. Since the goals are substantially tied to this step, every goal must be able to generate at least one criterion. Baker et al. (2002), says that the measures should be few, non-redundant, meaningful and able to help in choosing from the alternatives.
After that, the decision-making tool is selected, and alternatives are considered against the criteria. This can be done objectively or subjectively. In the end, the solutions that have been chosen must be considered against the problem statement to see which one suits best. A successful entrepreneur must be able to employ this as they make decisions if they are going to keep their businesses competitive within the business environment. The business will operate, grow or even die within the environment. It collects resources and inputs and offers outputs for the same and so a successful business must put into account the context in which it is found. The business climate provides the opportunities available and threats as well and includes both external and the internal factors.
The internal environment will include everything that affects the business from within that can be controlled. It includes factors such as employees, the structure, and culture of the organization and the shareholders. Employees usually differ in the skill set, knowledge and attitudes. This means that some will be liabilities and have to be laid off while others will be assets. The management usually has the task of assigning or dividing work so that everyone gets what is within his or her abilities. Since shareholders have a right to ownership, they often have a responsibility to oversee the running of the business for instance in creating policies and having them implemented. They may also have a say in the way the business is structured. The structure is imperative as it controls for example communication throughout the organization. When new employees are added to the staff, they adapt to the values and the practices that they find therein. Therefore, how the organization does its work, the things it upholds and those that are intolerable must be well defined (Chand, 2010).
The external environment involves all the forces that cannot be controlled by the business but have an effect on how it is run or how it performs. The economic environment, for example, refers to the economy of saying the nation in which the business operates. It has a very significant impact on the productivity, and the entrepreneur has to consider factors such as inflation, investments, and savings. Sometimes the government can enforce rules or regulations that were not there at the beginning of business, which would then have implications on how they do their things. Therefore, the legal environment is an important consideration. Addiitonally, as part of the external environment are the social and the technological environment. A business in an environment with for example civil war will hardly do well as opposed to one that is in a peaceful social environment. Technological environment defines the transformation of inputs to outputs and can be innovation or even scientific techniques applied throughout production.
In recent times, one of the words that has been closely used within the business environment and rightly so is complexity. It reflects the reality of the current situation with leaders asking questions such as how to deal or focus on specific areas when everything is connected. With the onset of globalization, things such as boundaries have been eroded and are still being eroded so that the situation does not promise to get better. For example, the liberalization of trade has allowed there to be a substantial and easier flow of people, capital, knowledge and goods globally. This means that the triad markets that formed the basis of trade in the last century have been rendered almost obsolete. Companies from both developed and developing nations are seeking to tap the benefits of globalization to a large degree, which adds to the complexity of eroded boundaries. Entrepreneurs have had to sit and regroup to consider these changes if they are going to remain relevant in the changing business environment. When boundaries are abolished, sometimes a new homogeneity is created in a larger area, which would also have implications.
A number of factors can be attributed to the growth of foreign expansion such as education and technology. More and more people are embracing education as opposed to decades ago, and this continues to be the case implying that the future can only be worse. There are more technological advances now than ever before in history. This has meant that businesses have to change in the way they are run if they will amount to anything more than failed attempts. Issues such as diversity (Adams, 1996) have affected today’s business environment. This means that organizations will face different challenges both from within and without than they would have in, for example, a homogenous staff. It also has implications for their strategies and their response to crises. The customers will also be heterogeneous as they are from different cultural backgrounds presenting a plethora of needs that must be met. This is both a good and bad thing depending on how equipped a business is.
Leading a complex organization will require a mindset that is far-removed and different from the norm. A ranking system will only work well if at every level something different and specific is done. This will be difficult to achieve because of the interdependence in the complexity of the business environment and the promise of a future that is to be even more complex (Maznevski et al., 2007). Entrepreneurs will need to be able to simplify and clarify their visions and values then decentralize their processes so that every part will reflect a unique perspective of the business world today. The leader may no longer need to be one to tell others what to do, but may have to depend on their initiative, competence and creativity if the business is going to be successful. The importance of leadership in successful entrepreneurship cannot be overstated.
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