Management Principles and Practices 1

Case Study:
Enterprise Rent-
A-Car
MANAGEMENT PRI NCI PLES AND PRACTI CES 1
Case Study: Enterprise Rent-A-Car
reat companies require effective managers and leaders
to guarantee success. ut !"at are t"e differences
#et!een management and leaders"ip$ %
&"e mar'et is c"anging so rapidly t"at products and services
t"at successfully met consumer tastes and needs a fe! years
ago are o#solete today. Proactive leaders"ip must constantly
monitor environmental c"ange( particularly customer #uying
"a#its and motives( and provide t"e force necessary to
organise resources in t"e rig"t direction
1
.
)ormer *P CE+ , President Carly )iorina descri#ed in a
Stanford -niversity lecture t"e difference #et!een leaders"ip
and management is ./leaders"ip as c"anging t"e order of
t"ings and management as t"e production of accepta#le
results !it"in 'no!n constraints and conditions. Management
is not leaders"ip.0
1

&"ese 2constraints and conditions3 are t"e disciplines and !"at
ma'es up t"e structure of a successful organisation. &"e
+4ford definition of constraint is .strict control over t"e !ay
you #e"ave or are allo!ed to #e"ave0
5
!"ilst condition is .t"e
circumstances or situation in !"ic" people live( !or' or do
t"ings0
6
. *ence management po!er comes from organisational
structure( as it promotes t"ese constraints and conditions ./as
sta#ility( order and pro#lem solving !it"in t"e structure/0
7
!"ic" consequently s"ould produce 2accepta#le results3.
1
Covey( S.( 1889( Seven Habits of Highly Effective People( &"e usiness :i#rary( -ta"
1
)iorina( C.( 199;( The Difference between Management and Leadership( Stanford -niversity( vie!ed May 1( 199;(
<"ttp:==ecorner.stanford.edu=aut"orMaterial>nfo."tml$mid?1;1@A
5
Anon.( 1919( Oxford dvanced Learner!s Dictionary( +4ford -niversity Press(
"ttp:==!!!.o4fordadvancedlearnersdictionary.com=dictionary=constraint
6
Anon.( 1919( Oxford dvanced Learner!s Dictionary( +4ford -niversity Press(
"ttp:==!!!.o4fordadvancedlearnersdictionary.com=dictionary=condition
1
Question
1
>ndividuals !it" leaders"ip a#ility initiates c"anges "o!ever it
is an innate or acquired a#ility B!"et"er conditioned internally
in t"e !or'place or e4ternallyC t"at can #e possessed #y
anyone in t"e company especially senior staff , managers
!it"in t"e organisation.
Management is an official aut"ority commanding different
"ierarc"ies in t"e organisation. :eaders"ip po!er on t"e ot"er
"and comes from less tangi#le factors( suc" as values(
interests( and ot"er personal attri#utes
D
. :eaders"ip is an
individual3s attri#ute to influence t"eir peers to ac"ieve
#usiness o#Eectives , possi#ly inspire c"anges to t"ese
o#Eectives.
&o meet #usiness o#Eectives it is fundamental for management
to "ave control , organisational s'ills. Entities require a
diversity of s'ills to fulfill managerial criteria. &"ey include:
Plan and organiFe people and resources
Set and monitor #udgets
Control operations or services in order to meet
customers3 needs
;

&"ese criteria are essential in meeting #usiness o#Eectives at
all "ierarc"ies of t"e organisation.
>n terms of leaders"ip( staff !it" t"ese qualities motivates t"eir
su#ordinates or colleagues and decides t"e direction of t"eir
team( department or even t"e overall organisation. :eaders
"ave a tendency to s"ape t"e outcome of meetings #y
influencing t"eir peers or are loo'ed upon for decision-ma'ing.
&"ere is a closer correlation #et!een a leader and manager
t"an t"ere are differences in most instances. &"is is illustrated
7
Samson , Gaft( 1998( Leading" Leadership vers#s Management$ 5
rd
edn( Management$ Cengage :earning Australia(
Hictoria
D
&"in' Education( 1919( Management principles and practices Study %uide( page 11( &"in' Education( Iort" Sydney(
ISJ
;
2-sing a range of management styles to lead a #usiness3 199@( The Times %&&( page D7( <!!!.t"etimes199.co.u'A
2
!it" Enterprise %eneral Manager !"o leads a regional group of
City ManagersK City Managers are leaders of t"eir front-line
management employees. Andy &aylor( t"e current Enterprise
C"airman and CE+( !as a manager for "is fat"er Lac' &aylor.
*e carried out t"e processes and systems "is fat"er set up.
&oday( Andy leads and manages t"e #usiness
@
.
ost organisations face t"e c"allenge of a competitive
mar'etK "ence #usinesses and corporations "ave to
attain "ig" level of customer service to remain
competitive. Mey personnel suc" as Management Accountants
, >nternal Auditors mig"t assist managers develop cost
processes and service #enc"mar's for staff to ad"ere to in
order to ac"ieve t"eir #usiness o#Eectives. Guring t"ese
instances( management "as to #e firm( e4press t"eir decision
to t"eir su#ordinates and "ave t"em !or' !it"in t"e
introduced process.
M
>n a demanding industry( managers "ave to adopt an
Autocratic-style of leaders"ip to meet #usiness o#Eectives.
&"ey "ave to ma'e unilateral decision t"at must #e enforced
on t"eir su#ordinates. Employees are e4pected to ad"ere to
t"ese decisions as t"eir managers "ave legitimate po!ers !it"
t"e consequence of punis"ing or re!arding t"eir !or'ers.
)or instance Andy &aylor !as adamant t"e customer
satisfaction measure( ESNi #e a mandatory #enc"mar' for all
#ranc"es to ac"ieve #usiness o#Eectives. &o increase
dedication from employees( an opportunity of promotion !ill #e
a!arded !"en t"ey reac"ed or e4ceeded suc" #enc"mar's
8
.
@
2-sing a range of management styles to lead a #usiness3 199@( The Times %&&( page DD( <!!!.t"etimes199.co.u'A
8
2-sing a range of management styles to lead a #usiness3 199@( The Times %&&( page DD( <!!!.t"etimes199.co.u'A
3
Question
2
An illustration of !"ere autocratic leaders"ip style may #e
appropriate is !"en t"e entity is ne! and t"e employees are
ine4perienced and "ence needs t"e guidance of leaders"ip in
t"eir !or'. Anot"er instance is if t"e people are disengaged in
t"eir Eo# and "ave no clear direction and t"ere is vast internal
politic'ing of t"e 'ind t"at is disruptive and causes an
emotional strain in t"e !ay t"e organisation is #eing managed.
*ere a po!erful autocratic leaders"ip mig"t "elp to re-align
t"e organisation to its original position and get t"e people #ac'
in s"ape
19
.
it" organisations adopting autocratic-style leaders"ip
to remain competitive in t"e mar'et via service
#enc"mar's( t!o maEor predicaments still remainK
motivating staff , employee retention. +rganisations
repeatedly discover t"at t"ey spend su#stantial effortK money
and time to train staff only to "ave t"em improve into an
important asset and depart t"e organisation for #etter
opportunities.
J
&"e pro#lem is t"at t"e managers "ave not determined
employees3 needs suc" as gro!t" !it"in t"e company.
Consequently( t"e individuals3 needs "ave not #een satisfied
and it "as not corresponded !it" t"eir o!n personal
aspirations against t"e o#Eectives of t"e company.

>n 1865( A#ra"am Maslo!( loo'ing at motivation( identified a
"ierarc"y of needs for individual employees. Everyone "as
needs for !ater( food !armt" and safety. &"ese "ave to #e
19
&"eyagu( G.( 199@(#tocratic vs' (ons#ltative Leadership( EFine Articles( su#mitted Marc" 1@(199@( <
"ttp:==eFinearticles.com=$Autocratic-vs-Consultative-:eaders"ip,id?1976816A
4
Question
3
met #efore a person can move on to fulfilling t"eir "ig"er
needs.
11

Maslow's Hierarcy o! "eeds #yra$id
&"is "ierarc"y applies to t"e !or'place. )or instance !"at
motivates t"ese levels of needs mig"t #e !ee'ly !age to cover
t"e p"ysiological needs( occupational "ealt" , safety
guidelines for security needs( good team mem#ers for social
needs( important proEects or recognition for esteem needs( and
lastly( opportunities for career development to realise an
individual3s potential during t"e stage for self-actualiFation.
Gemocratic-style leaders"ip gives employees t"e opportunity
to #e innovative and ma'e t"eir o!n decisions collectively Bi.e.
meetingsC in doing t"eir daily tas's. &"is ma'es t"em feel
important , increase t"eir self esteem. )urt"ermore !"en
employees start s"aring t"eir ideas in improving t"eir area3s
operations( !ider o#Eectives are realiFed. Anot"er advantage of
11
2-sing a range of management styles to lead a #usiness3 199@( The Times %&&( page D;( <!!!.t"etimes199.co.u'A
11
-niversity Gepartment of Rural *ealt"( 1919( Theme % ) Leadership Maslow!s Hierarchy of *eeds
Pyramid$ -niversity of &asmania( su#mitted Marc" 11(1919( < "ttp:==!!!.rural"ealt".utas.edu.au=comm-
lead=leaders"ip=maslo!-diagram."tmA
%
democratic-style leaders"ip is !"en managers consult t"eir
senior employees , team leaders regularly on t"eir perspective
!"en running t"e department3s daily operations. -sually
su#ordinates !it" referent and e4pert po!er influence t"ese
open discussions.
Additionally( democratic-style leaders"ip assists staff to #eing
innovative and encourages t"em to !or' #etter. &"is !ill
empo!er staff to ma'e decisions impacting t"e !or'place and
t"eir division !"ic" consequently meets customer service
commitments. *ence( employees ta'e pride in t"eir !or'.
Enterprise +ent,,(ar also applies t"e democratic style of
leaders"ip( encouraging employees to provide ideas to add to
decisions passed on #y management. &"ey implemented t!o
types of democratic style management.
Pers#asive leadership,style - !"ere t"e leader Bor
customer service representativeC ma'es t"e decision first
and persuades employees Bor customerC t"at it is t"e
rig"t decision.
(ons#ltative leadership,style - !"ere t"is involves t"e
group contri#uting to t"e decision ma'ing process !it"
t"e leader ma'ing t"e final decision.
An e4ample of t"e persuasive-style is !"en a customer "as
approac"ed t"e Enterprise representative of a ve"icle for t"e long
!ee'end. &"e representative gives t"e customer rental car
optionBsC and persuades t"e customer !"y t"ose options is t"e
correct one.
An e4ample for consultative-style is !"en a car "as #een in an
accident and a customer needs a "ire urgently. :ocal managers
ta'e a consultative approac" to understand t"e issues and find
t"e rig"t solution for customers !"o mig"t #e upset or !orried
15
MaEority of meta-analysts , psyc"ometrician social la#oratory
studies Bfrom 18D8 until todayC conducted e4periments on t"e
effect of democratic , autocratic leaders"ip !it" groups
concluded t"at e4perimentally imposed democratic-style
leaders"ip may #e relatively more effective Bcompared to
autocratic leaders"ipC !"en la#oratory groups are given
15
-sing a range of management styles to lead a #usiness3 199@( The Times %&&( page D;( <!!!.t"etimes199.co.u'A
&
moderately or "ig"ly comple4 tas's
16
. *ence t"e democratic
leaders"ip-style meets t"e demands of t"e a#ove t!o Enterprise
customer scenarios.
As #usiness progress( t"ere is an increase in customer
demand. Concerns lay !it" "o! efficient t"e organisation3s
services are !"en faced !it" frequent customer enquiries ,
ot"er concerns.
&"e dra!#ac's of autocratic leaders"ip during t"is scenario are
t"at managers , senior staff cannot afford to 2micromanage3
t"eir staff due to t"e influ4 of customer enquiries.
J"en dealing !it" face-to-face live pro#lems and enquiries
from customers t"ere is no time to discuss t"eir pro#lems
collectively in a meeting Bsuc" t"at of democratic-style
leaders"ipC. )irstly t"is !ill #e time-consuming as customers
!ill !ant to get t"e enquiry resolved immediately and finally it
reflects incompetence on t"e representative3s part !"o is
dealing !it" t"em.
:ive decisions need to #e made no! and t"en !it"out any
consultation !it" management or senior colleagues3 approval.
&"e decisions "ave to #e made s!iftly as it reflects on
efficiency from a customer3s perspective and "ence a great
16
%astil( L.( 1886( Meta,analysis of Democratic Leadership( Small %roup Researc"( page 691( -niversity of Jisconsin-
Madison( su#mitted August 1886 <"ttp:==faculty.!as"ington.edu=Egastil=pdfs=:eaders"ipMetaAnalysis.pdfA
'
Question
4
deal of initiative must #e placed on t"e customer service
representative3s part.
:aisseF-)aire style leaders"ip grants employees opportunities
to provide for customers immediately !it" t"e !or'place
'no!ledge( resource and tools t"ey "ave access to. &"is is
!"ere customers receive a standardiFed service 'no!ing
e4actly !"at t"ey "ave ordered or as'ed for. )or instance( a
return customer !"o 'no!s !"at "e !ants and is a!are of t"e
associated costs !it" t"e rental !ill require minimal feed#ac'
or advice as t"e customer is already a!are of "is="er needs.
*ence :aisseF-)aire encourages a more quic'er , streamlined
customer service.
>nternally( :aisseF )are leader performs a minimum of
leaders"ip functions and lets t"e !or'group sort out t"eir o!n
roles and tac'les t"eir o!n !or' in t"eir o!n !ay !it"out
"is="er participation. &"e :aisseF-)are tec"nique is usually only
appropriate !"en leading a team of "ig"ly motivated and
s'illed people !"o "ave produced e4cellent !or' in t"e past.
+nce a leader "as esta#lis"ed t"at "is team is confident(
capa#le and motivated it is often #est to step #ac' and let
t"em get on !it" t"e tas' since interfering can generate
resentment and detract from t"eir effectiveness
17
.
A good e4ample of :iasseF )are management is t"e small
entrepreneurial teams t"at manage and lead local Enterprise
offices. &"ese teams are decentraliFed and ma'e many
decisions on t"eir o!n. &"is s"o! a type of laisseF-faire
structure
1D
Gue to t"e carefree nature of t"is leaders"ip structure(
employee lac' of motivation can #e a disadvantage. &"is is
resolved #y t"e esta#lis"ment of corporate guidelines and
compre"ensive manuals( frequent staff training and t"e
prospect of career promotions.
17
Anon.( 199;(Leadership Styles$ Ji'iEducator( last modified Luly 11(1991( <
"ttp:==!i'ieducator.org=:eaders"ipOstylesPAutocraticA
1D
-sing a range of management styles to lead a #usiness3 199@( The Times %&&( page D;@ <!!!.t"etimes199.co.u'A
(
J+RG C+-I&: 1;9;
REFERENCE
1. Covey( S.( 1889( Seven Habis of Highly Effective People(
&"e usiness :i#rary( -ta"
1. )iorina( C.( 199;( The Difference between Management
and Leadership( Stanford -niversity( vie!ed May 1( 199;(
<"ttp:==ecorner.stanford.edu=aut"orMaterial>nfo."tml$
mid?1;1@A
)
5. Anon.( 1919( Oxford dvanced Learner!s Dictionary(
+4ford -niversity Press(
"ttp:==!!!.o4fordadvancedlearnersdictionary.com=dictio
nary=constraint
6. Anon.( 1919( Oxford dvanced Learner!s Dictionary(
+4ford -niversity Press(
"ttp:==!!!.o4fordadvancedlearnersdictionary.com=dictio
nary=condition
7. &"in' Education( 1919( Management principles and
practices Study %uide( page 11( &"in' Education( Iort"
Sydney( ISJ
D. 2-sing a range of management styles to lead a #usiness3
199@( The Times %&&( pp D7-D@(
<!!!.t"etimes199.co.u'A
;. Anon.( 199;(Leadership Styles$ Ji'iEducator( last
modified Luly 11(1991( <
"ttp:==!i'ieducator.org=:eaders"ipOstylesPAutocratic
A
@. -niversity Gepartment of Rural *ealt"( 1919( Theme
% ) Leadership Maslow!s Hierarchy of *eeds
Pyramid$ -niversity of &asmania( su#mitted Marc"
11(1919( <
"ttp:==!!!.rural"ealt".utas.edu.au=comm-
lead=leaders"ip=maslo!-diagram."tmA
8. &"eyagu( G.( 199@(#tocratic vs' (ons#ltative
Leadership( EFine Articles( su#mitted Marc" 1@(199@(
< "ttp:==eFinearticles.com=$Autocratic-vs-
Consultative-:eaders"ip,id?1976816A
1*