Management: 20th Century versus 21st Century

Introduction

A leader is any individual leading an organization, institution or group of people. Leadership has, therefore, been defined by many as the activity of leading people in an institution, organization or group; better still, a great ability to do the aforementioned. However, Bass & Bass define leadership as a process that involves social influence. It even goes further to maximize other people’s efforts towards the attainment of some goal.

According to Wood & Wood, leadership requires the leader to establish a clear vision of the institution at large, or of the specific segment. Once this has been done, the leader must share the vision with the members of the team. This must be done in an objective manner that allows the members to assimilate, internalize and understand how the vision benefits the organization and individual members. This approach will ensure that they voluntarily follow their leader towards the vision achievement. Adequate information necessary for realizing the vision is then shared with the team to ensure consistency in working towards a common goal. The final step involves coordination and harmonization of conflicting interests of stakeholders and members. Individuals in leadership positions step up during crisis, think creatively and act in difficult situations.

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According to Crainer, the 20th century leader’s job was about moving goods, while the 21st century leadership is about moving people. This essay seeks to provide an explanation of the difference between the business landscapes of the two centuries as well as the differences between the leadership skills of the 20th and 21st century leaders.

The 20th Century Leader vs. the 21st Century Leader

In the 20th century, leadership and management were about the achievement of one set goal, which was the delivery of goods and services in a bid to make profits. This fixed goal was entirely dispiriting, frustrating and unexciting to the workers who were often pushed to attain unrealistic financial targets. This situation led to the utter overload and diminishing production levels, not to mention high staff turnover, as workers sought better working conditions. In effect, the owners of organizations became frustrated, which meant that the goal was innately unsustainable.

The 20th century management of goods and service delivery was a linear goal, which could be realized in totality. Through the economies of scale, the system became more progressive and cheaper. Albeit with diminishing returns, the system incorporated downsizing and outsourcing, thus continuing with the economies of scale. Rules were put in place and enforced easily. Strict and precise processes were easily established and followed. Mistakes were eliminated by doing away with anything that fell short of the set rules and built structures. The specific people were blamed and eventually punished for certain mistakes. Thus, this is a representation of a linear environment where operations resemble those of a closed universe, which does not give room for deviations from the set rules, norms and beliefs.

In the linear environment, the customer was manipulated as opposed to being a stakeholder capable of affecting the long-term success of an organization. Consumers were manipulated to buy the goods and services that the system generated. In a similar manner, the old management system treated its workers as human resources that could be exploited and then discarded as the management deemed fit. The scheme in was antagonistic to initiative and innovativeness. As stated earlier, it operated in a form of a closed universe, and, therefore, any considerable amount of innovation risked subverting the linear, simple and finite world that had been created. Therefore, the system became an end in itself, working very efficiently throughout the 20th century.

With regard to the 21stcentury, the world changed, and so did the businesses. The 1950s and 1960s experienced an economically stable world characterized by strong and consistent demand for goods and services from reputable organizations. Therefore, the firms were in total control of the market, and this factor that allowed them to get away with the manipulation of their consumers. Although, today, in the 21st century, that kind of world has ceased to exist and the customer is in charge. There has been an elemental shift in the power balance between buyers and sellers, with buyers getting the upper hand. Currently, unless an organization delights the customer and continuously provides a stream of new added value while ensuring improved customer outcomes, the consumer is likely to go elsewhere to satisfy his needs and wants.

This power shift in the 21st century has caused management and leadership styles to change, and organizations are striving to delight their customers in order to build lasting relationships. The firms still make profits, but the profits are a result of the customers’ loyally. Delighting customers is the inestimable goal of the 21st century mode of leadership. The system is innately uplifting for the employees, while, at the same time, it is invigorating for the managers and executives. As a result, the goal of this management system is intrinsically sustainable.

According to Krebs, the 21st century style of leadership presents a difficult, complex and infinite goal as opposed to being linear and finite. Incessant innovation has now become a requirement as opposed to being considered as a de-stabilizer and a distraction. In a world of the continual experimentation and initiative, firms try new things to establish working solutions while adopting the innovations that add value to their customers’ and clients’ experiences. Mistakes previously considered the elements for elimination are currently considered as crucial elements of the learning process.

The concepts of downsizing and outsourcing are currently known to destroy a firm’s medium-term capacity to compete. The system recognizes economies of scale as the aspect that hides the true costs that delivers value to the clients in a timelier manner. Structures and rules, on the other hand, currently facilitate and emphasize the initiative of the employees as opposed to undermining their work. Employees and customers in the new system of leadership are treated as crucial stakeholders with whom the organization has a mutually beneficial relationship. They are engaged in real conversations, unlike in the earlier leadership style, where customers have been manipulated and employees have been ordered around. Currently, the customer is the king of the business, while the employees are charged with the responsibility of finding new ways of adding value while delighting customers.

Conclusively, the firm is no longer perceived as an end in itself. It rather focuses on meeting the stakeholders’ and clients’ needs adequately. The 21st century leadership system has all the needed process structures. Unlike the earlier system, the current management makes room for talent and energy at work. Earlier, employees were required to work on the basis of strict guidelines of outlined processes with no room for creativity. As a result, the 21st century organization is hands-on when it comes to getting things done.

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