Topic: Leader Communication; Culture and Values

Authors, Title and Publication

Jing, F., Avery, G., & Bergsteiner, H. (2014). Enhancing performance in small professional firms through vision communication and sharing. Asia Pacific Journal of Management31(2), 599-620.

Summary

Research has suggested that when leaders work with a vision, a variety of important outcomes at the individual, group, and organizational levels can be achieved. These include reduced turnover, enhanced employee and customer satisfaction, and better financial performance. However, much of the existing research into the effects of a leader’s vision on performance has been conducted in large organizations. Visions may influence small firms differently from larger enterprises because smaller firms represent simpler and more integrated social systems, with fewer people, fewer hierarchical levels and less subdivision of work. Further, physical distance between managers and staff, if not psychological distance, is less in small enterprises. Thus, leaders in small organizations may be better able to influence employees directly, monitor performance efficiently, and hold employees accountable. The effects of vision may be magnified in small firms compared with large firms. This study focuses particularly on small firms and links the extent of vision-communication and vision sharing to multiple stakeholders and multiple measures of performance.

The researchers conducted 580 face-to-face interviews with managers, employees, and customers in 100 retail pharmacies in the city and suburbs of Sydney, Australia. Results highlighted a positive relationship between vision communication and performance in the retail pharmacies, using five measures—financial assessments, employee and customer satisfaction, productivity, and staff retention. Organizations whose managers communicate the vision to staff and whose employees share this vision outperform their peers across all business indicators and retain their employees longer. Financial performance and productivity were higher with long-term staff and managers. The findings are largely consistent with results from previous studies that examined links between vision and organizational performance.

Implications for Practice

1) Small businesses should not only adopt a vision but also communicate and share it among leaders and employees.

2) Organizational leaders should develop transformational, charismatic, and visionary leadership styles and communicate a shared vision with a clear direction and purpose that engages, energizes, and unites employees.

3) Organizations should create a work environment that is attractive to both recruiting and retaining scarce workers in order to satisfy customers, and enhance productivity and financial performance.

Location of Article

The article is available online at: http://link.springer.com/article/10.1007%2Fs10490-013-9345-9 (abstract free, purchase full article)

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Heidy Modarelli handles Growth & Marketing for IPR. She has previously written for Entrepreneur, TechCrunch, The Next Web, and VentureBeat.
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