Analysis MTN: Part 2

Introduction

Leadership has existed since the dawn of time and remains a very important component of business and innovation. In this post, we will be looking into leadership structures, styles and their roles in innovation within MTN.

Leadership Structures

First we need to look at a basic leadership structure to better understand what we’re working with. The following is a traditional leadership (hierarchical) structure according to Morgan (2015):

https://www.forbes.com/sites/jacobmorgan/2015/07/06/the-5-types-of-organizational-structures-part-1-the-hierarchy/#5161c70a5252

Morgan (2015) states that this structure consists of many layers (as can be seen in the image above). He also states that communication is downwards, from the top leader to the individuals at the bottom of the structure. This means that communication in this structure is mostly one way (Top to bottom), because of this innovation stagnates as new ideas don’t reach the top leadership and are thus not implemented. He also states that this structure is littered with bureaucracy and is very sluggish.

He also goes on to say that this leadership structure doesn’t focus much on employee satisfaction and experience, this means that the organization is going to have a difficult time hiring top talent. This also influences innovation and many other aspects of the organization.

One strength of this structure is that it is good at maintaining the status quo, something which organizations desired decades ago (Morgan, 2015). This strength, however, can be a weakness.

MTN’s Leadership Structure

MTN follows the traditional leadership structure mentioned above. According to MTN (n.d.) at the very top of their leadership structure is their CEO, Mteto Nyati. He is responsible for making decisions that will affect the entire company and acts as a point of communication between the board of directors and the corporate operations.

Below him is the chief officers of human resources, finances, consumers and many more that all serve as heads of different departments within MTN. They make decisions regarding their departments. Below them would be the heads of sections within the different departments. These leaders would make decisions regarding their specific section.

Leadership Styles

 

According to Johnson (n.d.) there are different styles of leadership and each of these styles have their own advantages and disadvantages. He mentions the following styles:

Laissez-Faire

 

A leader that makes use of the laissez-faire style of leadership will, generally, lack direct supervision over employees and won’t provide feedback, at regular intervals, to his/her subordinates. This leadership style can lead to increased costs, little control, and poor production. An example of a laissez-faire leader would be when a leader gives their subordinates an objective and then sit back to let them sort it out on their own.

Autocratic

 

The autocratic leadership style provides leaders with the most amount of control as they will be the only ones to make decisions and they also don’t require input from others. The autocratic leader’s decisions will, mostly, remain unchallenged by any subordinates. A good example of a country that uses this leadership style would be North Korea or Cuba.

This leadership style won’t be appreciated by creative team members that want to be free to do what they think is best, but it will be good for employees that require close supervision.

Transactional

 

A transactional leader will give subordinates tasks to do and will either provide them with a reward, for good work, or punish them for work that is not up to standard. The leader and the subordinates set their predetermined goals together. An example of this leadership style would be a teacher that rewards good children with a star and punishes bad children with time-out or a call to their parents.

Transformational

 

This leadership style requires a more active participation from the leaders. This style is highly dependent on great levels of communication from the leader in order for goals to be met. Transformational leaders use communication and high visibility to motivate subordinates, improve productivity and/or efficiency. The idea is that the transformational leader focuses on the big picture within the organization and delegates some of the smaller tasks to their subordinates.

An example of this leadership style would be when a CEO asks his employees to start embracing innovation and then he himself starts innovating in his work. He leads by example.

Situational

 

Anthony (n.d.) states that the situational leadership style refers to when a leader adapts or changes their style of leadership depending on the situation and who they are leading. Situational leaders adapt their style and it is not up to the employees to adapt to the leader’s style.

The different styles of leadership that a situational leader can make use of (Anthony, n.d.):

·         Telling & Directing – The leader makes the decisions and informs the others. Can also be seen as micromanagement. Employees simply do what they are told.

·         Selling & Coaching – Decisions ultimately lie with the leader but the leader tries to get input and buy-in from subordinates.

·         Participating & Supporting – Leader provides direction but the decisions ultimately lie with the subordinates.

·         Delegating – Least involvement from the leader and the team is mostly responsible for making decisions and completing tasks. Leader may still provide direction from time to time.

 

What leadership style does MTN make use of?

According to KenBlanchard (n.d.) MTN was, at one point, seeking to change the culture in their organisation to something that aligns more with their desired culture. During this process MTN needed leaders that would be able to help implement this change. To better implement the change MTN decided to make use of the situational leadership style, as suggested by KenBlanchard.

Role of leadership in innovation culture

Barsh, Capozzi and Davidson (2008) states that the way leaders behave sends strong signals to employees. Innovation is inherently associated with change and takes attention and resources away from efforts to achieve short-term performance goals. More than initiatives for any other purpose, innovation may therefore require leaders to encourage employees to win over their hearts and minds. 

Managers believe that paying lip service to innovation but doing nothing about it is the most common way they inhibit it. The failure of executives to model innovation such as encouraging behaviour, risk taking and openness to new ideas, as well as rewarding nothing but short-term performance and maintaining a fear of failure do nothing but inhibit the capability of employees to think and live innovatively. 

Holding leaders accountable for encouraging innovation makes a big difference. Innovative leaders spend most of their time making decisions about innovation involve by determining what types or strategies to focus on, who gets to work on the resulting projects, and how to commercialize the fruits. Accordig to Barsh, Capozzi and Davidson (2008) leaders can also take several other practical steps to advance innovation:

Define the kind of innovation that drives growth and helps meet strategic objectives. 

Leaders communicate to employees the type of innovation they expect. In the absence of such direction, employees will come back with incremental and often familiar ideas.

Add innovation to the formal agenda at regular leadership meetings. 

It sends an important signal to employees about the value management attaches to innovation.

Set performance metrics and targets for innovation. 

Leaders should think about two types of metrics: the financial (such as the percentage of total revenue from new products) and the behavioural.

How does MTN’s leaders encourage/promote innovation and an innovation culture in their organisation?

 

 New Leadership

According to McLeod (2017) the former Vodacom executive, Godfrey Motsa, took over as CEO of MTN South Africa from Nyati Mteto. Before joining MTN last year, Motsa was chief officer of the consumer business unit at Vodacom South Africa and has also been CEO of Vodacom Lesotho and Vodacom DRC. This change in leadership could mean that MTN seeks fresh blood with regards to innovative ideas and decision making.

 

Management Shakeup

On top of having a change in management, MTN has also reshuffled its management structure due to the record breaking $5.2 billion fine in Nigeria (ENCA, 2016).

The changes to management brought upon by MTN are meant to revitalise the leadership aspect of the company to not only help prevent catastrophes like the Nigerian fine but to also add new and fresh ideas with regards to innovation.

Combination of Programmes, Practices and Policies

As mentioned in our previous blogpost MTN also promotes a culture of innovation through their learnership programme, by keeping employees satisfied and exposing employees to outside influences.