Financial Analysis of Microsoft Corporation Essay

The recent one-week shut-down of Nigerian economy following government’s fuel subsidy removal cost the economy $1. 3b (Wagstyl, 2012). People resisted the good intentioned policy; they perceived that it would aggravate hardship. The resulting annual savings of $8 billion was to be re-channeled to infrastructure (Yusha’u, 2012). It would also eradicate corruption (Wagstyl). During the crisis, local petroleum prices and global oil prices increased by 115% and 0. 9% respectively (Yusha’u). Jonathan partially reversed the decision on 16th, setting per-litre price at N97. 00 (?0. 0). Jonathan faced leadership dilemma: remove subsidy or sustain it. Petroleum price determine other prices in Nigeria.

Jonathan chose to remove the subsidy, and the followers passed a vote-of-no-confidence on his leadership. The manner in which Jonathan removed the subsidy and its partial reinstatement is indicative of his leadership qualities which can be situated within a set of leadership paradigms. Leadership paradigms include: Heroic/Weberian charismatic, trait, transactional, New Leadership, post-charismatic leadership, and creative leadership (Rickards, 2012, pp. 4-91). First, Jonathan reduced public servant’s allowances including his, demonstrating symbolic leadership, a departure from dominant rational model (Rickards, 2012, p. 4). Though people interpreted this positively, however, just like Rickards’ (2012, p. 107) warning that sense-making is different from interpretation, the followers sensed this act to be that Jonathan had not done enough: He needed to reduce the entire government size to reduce spending before subsidy removal.

Second, the crisis and its associated cost ($1. 3b) were avoidable had the issue been properly handled. Jonathan did not consult widely, neither did he communicate adequately with the followers to enable him understand their feelings before removing the entire subsidy. He demonstrated more of task-oriented leadership than people orientation, an aspect of transactional leadership map. He ignored the all-important environmental factors embodied in a complex adaptive change like subsidy removal.

An aspect of leadership is to read situations (Rickards, 2012, p. 96) which Jonathan did not do adequately. As a Weberian charismatic leader, Jonathan allowed the crisis to persist for 7 days before listening to the people. Confident that people would give up after a few days of protest, Jonathan was entrapped by Icarus paradox of leadership, reminiscent of dysfunctional leadership – a dark-side of charisma (Richards, 2012, pp. 87-88). McLaurin (2008) suggested that charisma is not compulsory for leadership effectiveness.

Also, Jonathan did not demonstrate Jim Collins’ fifth-level leadership by exercising personal humility and great will-power, reminiscent of post-charismatic leadership (Rickards, p. 85). Dorfman & House (2004, p. 65) believed that envisioning change and innovation is a central feature of post-charismatic leadership to which followers should aspire. This includes subsidy removal in Nigeria. People resisted largely because of lack of trust on how the subsidy proceeds would be utilized, as many believed it would end up in politicians’ pockets.

Although trust is a dilemma for leadership, trust-building has been listed as key attribute of transformational leadership (Rickards, 2012, p. 121). Jonathan did little to build trust in his followers to prepare them for accepting vulnerabilities based on their positive expectations. Therefore, he exhibited a weak transformational leadership skill. Finally, Jonathan attempted to demonstrate creative leadership by removing the entire subsidy, a novel decision in Nigeria.

If successful, he would have been seen as a creative leader, who achieves new, valued goals, and influences others (Rickards, 2012, p. 226). Thus, Jonathan’s handling of subsidy removal and the associated crisis profiled him as a charismatic and transactional leader. It also revealed him as weak creative and transformational leader. Since leadership skills can be developed (Rickards, 2012, p. 30; Senge, 2006, p. 339-340), Jonathan needs to improve his skills for reading situations, communication, trust-building, and people orientation.

References

Dorfman, P. W. & House, R. J. (2004). Cultural influences on organizational leadership: Literature review, theoretical rationale, and GLOBE project goals. In R. J. House, P. J. Hanges, M. Javidan, P. W. Dorfman, & V. Gupta (Eds.), Culture, leadership, and organizations: The GLOBE study of 62 societies (pp. 51-73). Thousand Oaks, CA: Sage. McLaurin, J. R. (2008). Leader-effectiveness across cultural boundaries: An organizational culture perspective. Journal of Organization Culture, Communications and Conflict, 12(1), 49-69. Available from:

http://web.ebscohost.com.ezp.waldenulibrary.org/bsi/resultsadvanced?hid [accessed: 6 February 2012]. Rickards, T. (2012). Dilemmas of leadership.2nd. ed. Oxon, England: Routledge. Senge, P. M. (2006). The fifth discipline: The art & practice of the learning organization. NY: Doubleday. Yusha’u, M. J. (2012), Nigerian fuel subsidy: Strike suspended [online]. BBC News. Available from: http://www.bbc.co.uk/news/world-africa-16579001[accessed: 8 February 2012]. Wagstyl, S. (2012). Nigeria: truce in fuel price dispute [online]. Available from: http://blogs.ft.com/beyond-brics/2012/01/16/nigeria-truce-in-fuel-price-dispute/ [Accessed: 8 February 2012].

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