The market is also extremely segmented with a number of manufacturers in the economy, compact, medium and premium segments. Many car manufacturers have gone bankrupt and closed because they could not control costs, improve quality and many of these firms did not have a strong leader with a good vision. BMW like a few of the manufacturers has managed to survive and grow, mainly because of the excellent leadership (Egri, 2000). This paper analyses the given BMW case study and presents details of the leadership at BMW and how it has managed to overcome the many problems. The paper first presents theories on leadership and then it analyses various leadership issues of the case study.
Transformative Leadership: Transformation leadership is focussed at ushering in a strategic organisation change, in response to market forces that are technological, competitive or regulatory. The leadership comes into practice where there is a instability and transition and changes have to be done to transform an organisation to make it competitive. The change that is envisioned may be disruptive and system wide and the leader needs to have the vision to balance a number of social, financial, and marketing forces (Zaccaro, 2001).
Transactional Leadership: Transactional leadership is a rational exchange process in which subordinates needs are met if their performance measures up the leaders requirements indicated in explicit or implicit contract (Bass, 2007). Importance is on contractual requirements, meeting goals and obtaining rewards. Bass suggests leaders adapt their style to the current requirements so that the style may be transactional in one case and transformational leader another.
The leadership style of Joachim Milberg who was appointed as the CEO and later that of Dr. Helmut Panke as the CEO after Milberg joined the supervisory board can be described