TABLE OF CONTENT:

Introduction .................................................................................................................... 2 What makes someone a better business leader? ........................................................ 2 1. Complexities of business ........................................................................................... 3 1.1 circumstances create heroes ................................................................................. 3 1.2 4+2 formula for business success ........................................................................ 4 2. The paradoxes of management .................................................................................. 7 3. The challenges of leadership ...................................................................................... 8 Conclusion ..................................................................................................................... 9

INTRODUCTION

Leadership is a very important component of success in an organization. Especially in highly competitive business world, leadership takes on an even greater importance. Without competent leadership, organizations rarely prosper in this complex world.

What makes someone a better business leader? Anyone can be a business leader but the challenges like emphasis to address the emerging issues as well as opportunities and act fast; anticipate business opportunities and be proactive; reacts when the power or safety is challenged; and interprets the complexity business world around only a few people get it right. "The common characteristic of these leaders is their ability to inspire and stimulate others to achieve worthwhile goals. The people who can accomplish these important deeds practice leadership" (Dubrin et al. 2006, p.3). Jack Welch once confirmed good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly drive it to completion.

To my opinion, a better business leader is someone who successfully leads the organization with vision by executing the right mission, establishing strategies and goals through people and avenues; drive the organization to achieve results from economic activities more effectively and sustained the result over the time.

1. COMPLEXITIES OF BUSINESS It is a world full of extraordinary complex systems in the economy today. Especially after each global financial crisis, the new regulatory environment has emerged and created new complexities in business world.

1.1 Circumstances create heroes Louis V. Gerstner, Jr. CEO of IBM (1993-2002) and Greg Brenneman COO of Continental Airlines are among the most inspired flagship leaders who successfully turn the organizations around, leaded their organizations from declined stage to top in the industries by figured out the complexities of the business, re-created a new vision to adapt with the hi-speed changing world and perform accelerated executions.

Gerstner was appointed as CEO of IBM in 1993 when the organization was facing a $16 billions loss, considered in decline stage of business and very close to bankruptcy in early 90s judged by industry observers. In a short period of time, Gerstner was able to turnaround IBMs situation, leaded IBM back to the top in IT industry. According to CNET News, in 2001, the company reported revenue of $85.9 billion and net income of $7.7 billion, thats what he achieved for IBM before he stepped down in 2002. IBM stock price 1993-2002 ($) (source: financialsensearchive)

Figure 1.1a: IBM stock price during Gerstner CEO-ed 1993-2002

Continental Airlines was also struggling at the same period of time. In 1993 Continental were considered the worst commercial airline in the USA, ranked 10th out of ten larges U.S Airlines. The airline had already declared bankruptcy twice and was about to make it for the third time. Its net income in 1994 was in decline of 613 millions. That was when Greg Brenneman stepped in as a COO. Within a year he was able to make $224M profit for Continental. He proved remarkably successfully turned this enormous problems airline to top of ten largest U.S carriers and delivered 24 consecutive quarters of profits during his lead.

(Source: New York stock exchange)

Figure 1.1b: Continental Airlines stock price during Brenneman CEO-ed

1.2 4+2 Formula for Business Success Gerstner flexibility implemented the formula for the turnaround of IBM. Gerstners four key strategic initiatives holding the vision by keeping the company together, changing the companys fundamental economic model, reengineering how the company did business and sell nonessential assets to raise cash.

Keep the company together

Change the company's fundamental economic model

Reengineer how the company did business

Sell nonessential assets to raise cash

Figure 1.2a: Gerstners four key strategic initiatives holding the vision Together with his successfully reinvented big blue and addressed corporate culture, he breathed some fresh air into the organization, Gerstner figured out eight principles leadership with 3 simple key concepts: win there wasnt a place for someone lacked zeal for contest; every IBMer had to be ready to fight in the complex marketplace. execute doing the right things faster, better, more often and more productively than their competitors do, team every IBMer had to be committed as one IBM. Brennemans strategies for Continental turnaround included file a flight plan and

Figure 1.2b: Brennemans five turnaround lessons

track its progress, clean house, think money in not money out, ask customer the right question and let the inmates run the asylum. The lessons seem simple yet its result pulled Continental out of a nosedive. Brenneman established his creditability from his Go Forward plan - a modified version of 4+2 formula for business success to save Continental. The go forward plan consisted of clear strategies to improve quality of its market plan fly to win, financial plan fund the future, product plan make reliability a reality and people plan working together. His goals were to create revenue and profit, secure liquidity, becoming an airline of reference and build a corporate culture for Continental.

Expand customer mix from backpacks to suits and briefcase. Cancel non profit flights. Market: Fly to win Goal: increase revenues and profit. Product: Make reliability a reality. Goal: become an airline of reference.

Gain liquidity by restructuring the balance sheet Selling off nonstrategic assets. Financial: Fund the future. Goal: Secure liquidity People: Working together. Goal: build a new corp. culture.

Transform customer's experience.

Change company's culture to restore employee's trust.

Figure 1.2c: Go forward plan of Brenneman

2. THE PARADOXES OF MANAGEMENT According to Wikipedia, paradox is a statement that leads to a contradiction or a situation which (if true) defies logic or reason, similar to circular reasoning. However Parker Follet described Paradoxes of management can be understood as getting things done by other people. The process of paradoxes in business demonstrated by selected direction, control, planning, motivation which leads to multiple outcomes. Because paradoxes are different at different level of management, size of the organization and business circumstances that is why the leader has to be certain and firm to lead their organization toward their vision by applying one of the four main frames of management models: Structural, Human Resource, Political and Symbolic model throughout the appointed process. A minor distraction could lead the organization to crisis. Gerstner likely used Human Resource model as mainframe during the turnaround and maintained it as core model for IBM. Gerstner realized IBM was too big and complex and there were too many talented people with unique expertise. So instead of clean house he disbanded the Management Committee, modified it to Corporate Executive Committee (CEC) to help him make big stakes decisions and focusing solely on policy issues that cut across multiple units. He turned IBM to an extended family; paying attention to needs, feelings, prejudices, skills, and limitations of each and every individual IBMer; He provided capacity to learn and to defend old attitudes and belief, find a way for individuals to get the job done while feeling good about what they are doing.

In another hand, Brenneman applied Structural model for Continental. He admitted he had never seen a company as dysfunctional as Continental. There was seems no strategy in place; managers were paralyzed by anxiety and the product was terrible. He did a clean house throughout the organization; he believed the team that managed a company into crisis would hardly able to get it back on track. By employing and redeploying manpower force that are new, full of energy, motivated, enthusiasm and determination, he blew a new fresh air to Continental. He reestablished structures to fit organizations new environment and technology. Clear responsibilities, rules, policies and procedures for the new Continental was also established.

3. THE CHALLENGES OF LEADERSHIP Leaders are placed multiple demands by their organizations. They are required to impart vision and execute it, initiate change lead to positive effect on the relationships among the team members besides delivering business result as well as making difficult decisions in flexible and adaptable solutions and to be able to recognize the fact that unexpected challenges will emerge.

Leaders are advised to analyze irrational and dysfunctional processes in their organizations. From there they could strategized ways fix it. To solve IBM problems, Gerstner was able to laid out the troubles of IBM were loss of customer trust, supported by low customer ratings on quality, mindless rush for decentralization, slow response to cross-unit issues, tension over control of the marketing and sales processes, confusing and contentious performance measurement system resulting in serious problems when closing sales with customers, bewildering array of questionable, even senseless, alliances.

Same for Brenneman, he saw Continental was the worst $6 billion company. He figured out Continental was top of the charts when it came to the number of irate customers, tenth straight year of losses, had long ago stopped respecting its employees and its customers, employee morale was abysmally low, employees were outwardly ashamed to even admit that they worked for the company. The successful Go Forward Plan was produced based on these problems analysis.

Most challenges of leadership is managing people, the leaders need to create morale and engage their people to the companys success by challenge the process, inspire a shared vision, enable others to act, model the way, encourage the heart.

Moreover, these straits are required for any successful business leader: personality traits, motivational traits and cognitive traits. Honesty, integrity as well as creativity and imagination, are essential leadership traits as well. It would be an important guide to leadership selection by understanding the traits of effective leadership.

CONCLUSION There are numinous definitions of what makes a better business leader. After all, the question serves as a self-reminder for one self to expand the boundary of selfexpectation and limitation to achieve things we think cant be achieved and to do things we think cant be done.

If there is a choice to join a good or a ruined company, pick the ruined one - provided youre confident of how good you are. That is where your potential explored, your boundary expanded, your inspiration bloomed and you will surprise who youre becoming like Gerstner and Brenneman did.

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