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Expert Speak: Effective leadership styles for retail businesses

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Given the constrained levels of profitability in , the sheer significance of improved business fundamentals in the industry is high. In this context what usually gets spoken about is the need to generate increased business through repeat footfalls and efficient and productive teams that can grow margins as well as make the business customer-centric. The sub-text that often gets missed is about the kind of leadership style that can effectively enable the organization to achieve these objectives.

Effective leadership styles for retail businesses
What differentiates great and effective leaders from ordinary managers lies as much in the long term vision, focus and quality of decisions that they make as it does in how those decisions are arrived at or how those are implemented

What differentiates great and effective leaders from ordinary managers lies as much in the long term vision, focus and quality of decisions that they make as it does in how those decisions are arrived at or how those are implemented. The focus of this article is really on the latter two aspects or the leadership style.

Talk is usually focused on task centricity vs people centricity as an approach. One school of thought vouches for leaders who drive discipline, rigour and business programs incessantly. However, very often, task focus is confused for effectiveness! This school of thought favours leaders that drive their direct reports relentlessly who are then expected to drive the rest of their down-stream teams in a similar cascading fashion. Nothing wrong with it except that it doesn’t factor in the levels of knowledge, understanding or concerns and feedback that ground staff may have.

Democratic styles have their own drawbacks in retail situations where generally there tend to be too many loose and open ends. Speed of execution could suffer!

What needs to be remembered is that retail organizations in general depend a great deal on the energy and efficiency levels of front end consumer facing staff in the field as also of the lower down staff across functions. Ensuring their efficiency and passion on a day-to-day basis is of paramount importance especially if the business wishes to make a day-to-day connect with customers. This calls for an appropriate leadership style and an organization culture that can help the organization being perceived consistently as consumer friendly and efficient.

The kind of organization culture that encourages such an environment is often a silent contributor to the success of the business. Imagine walking into stores where you not only like the merchandise on offer but also value the staff for their ability to smile, connect, recommend and service your requirements efficiently. Such a culture and environment is in most cases not an accidental flash and it flows in the day-to-day working of the organization. It cascades down pretty much from its leadership and has some important tenets…like a team that understands its role, its goals, is empowered to take decisions in crucial / conflict situations and is confident that the management will back them in crunch situations.

Those who have been in retail understand that the success of retail businesses lies as much in their execution as in their strategy. The job at hand of running a retail business is a hectic, intense and energy sapping exercise. It requires a combination of not just deep analytical skills, or attention to detail but also genuine people skills, quick decisive action and the passion to give it your all. Given the 365 day nature of the job, it requires leaders who are available to their teams at all times and then who can back their teams when they most need it. For this reason alone, it has little or no place for either the 9 to 5 types or for those who can’t work well with large teams or have little concern for people in their teams.

It is important for leaders to understand and imbibe the fact that overly autocratic styles that emphasize the do it as I say or only my way or the highway approach could be deeply flawed in the context of retail. While they can ensure discipline and task orientation in the short run, they are more likely to lead to unhappiness and a serious feeling of demotivation and not being understood in the medium to long run, causing stress, burnout and eventually a higher level of attrition.

Also, willingness and openness to share facts with the leader can present a serious challenge for reportees. They are more likely to refrain from sharing issues, concerns and bad and awkward news rather than risk unpleasantness from leaders who believe they know best. This is tricky in situations where team members down the levels have better product, process and domain knowledge than their leaders.

Leadership styles that have relatively a higher probability of succeeding in retail business are collaborative, flexible and situational. Such styles encourage and create an environment of transparency and openness, where employees across levels feel happy to be empowered and to be a significant part of the system and therefore work efficiently on a day-to-day basis.

The environment encourages and welcomes them to speak up on a day-to-day basis and share their issues and concerns with their direct superiors without feeling constrained about escalating issues when the need arises.

The environment, while keeping consumer facing employees energized enough to be giving off their best daily, also enables leaders to derive critical ground knowledge consistently. This added ground knowledge substantially improves their ability to make appropriate as well as fast decisions. And none of this comes at the expense of any loss of focus on tasks or business goals.

When it comes to goals and tasks – several managers prefer to set goals, leaving the nitty-gritty of execution to the concerned teams. There is nothing wrong with that except in situations where the targets and goals are far removed and way too tough to comprehend or achieve. Here true leaders don’t abandon their colleagues. Instead, they lead the way by working with the teams and demonstrate what to do and how to do it.

In general, it is critical to treat team members in every industry with respect, especially so in retail organizations. This is so because the behaviour of team members’ often mirrors that of their bosses. Any laxity here directly reflects in terms of a grumbling and sulking environment and couldn’t care less attitude of retail staff .

For leaders, looking or acting the part of a CEO is the easy part of leadership. The tougher part is knowing and understanding what works or what doesn’t. A combination of common sense acquired through experience and the ability to work towards a solution without ego in a manner that breaks barriers and builds natural connects just makes it easier.

Simultaneously, leaders that allow team members to evolve and grow, pat them on the back every now and then, kick them hard when needed, set a vision and target, define the broad path but allow them freedom and flexibility to execute within given boundaries and importantly show them the path when they flounder, are likely to elicit a far greater sense of ownership, responsibility and desired outcomes from their teams as well as effectively lead their organisations towards higher order goals.