The Relationship Between Management Styles and Management Skills (VCE SSCE Business Management): Revision Notes
The relationship between management styles and management skills
Understanding the connection
Businesses need effective ways to evaluate whether managers are using appropriate styles and skills for different situations. A manager's effectiveness depends not just on the style they adopt (autocratic, participative, or laissez-faire), but also on their ability to apply relevant management skills (communication, decision-making, delegation, planning, leading, and interpersonal).
The relationship between these two elements is critical. The management style chosen by a manager determines which skills will be most important in that situation. For example, an autocratic style relies heavily on centralised decision-making skills, while a participative style requires strong communication and interpersonal skills.
The effectiveness of any management approach depends on the synergy between style and skills. A manager might adopt an appropriate style for a situation, but without the corresponding skills, their effectiveness will be limited. Similarly, possessing strong skills without choosing the right style can also lead to poor outcomes.
Evaluating management effectiveness
To assess whether a manager has used the right style and skills, businesses examine several key areas. Each area requires consideration of both the management style adopted and the specific skills applied.
Outcomes and results based on objectives
Management style considerations:
- Did the manager choose a style that helped achieve outcomes ethically?
- Was the chosen style focused on completing tasks effectively?
Management skills considerations:
- Was communication open and transparent?
- Were decisions made centrally by the manager, or were they decentralised to the team?
- Did the manager delegate tasks appropriately, and were these tasks suitable for staff members?
- Was planning conducted at appropriate levels?
- Did the manager's leadership approach prevent or resolve conflicts?
- Were positive working relationships built and maintained with staff?
The success of achieving business objectives depends on matching the right style with the right skills. A task-focused objective might suit an autocratic style with strong decision-making skills, while a creative project might need a participative style with excellent communication skills.
Relationship with external and internal environment
Management style considerations:
- Was the style appropriate for managing the specific situation the business faced?
- Did the style allow the manager to respond effectively to stakeholders?
Management skills considerations:
- Were the right skills used, such as communication, interpersonal abilities, and decision-making?
- Did the manager adapt their skills to suit different situations?
External factors (customers, suppliers, competitors) and internal factors (staff, resources, culture) require different approaches. A crisis situation might need an autocratic style with decisive decision-making skills, while building partnerships requires a participative style with strong interpersonal skills.
Communication
Management style considerations:
- Did the chosen style allow for appropriate communication flow throughout the business?
- Was communication restricted or encouraged by the style?
Management skills considerations:
- What type of communication flow occurred: downward (manager to staff), upward (staff to manager), lateral (across departments), or open (all directions)?
- Did the manager demonstrate effective communication skills?
The management style directly affects communication patterns. Autocratic styles typically involve downward communication, participative styles encourage open communication, and laissez-faire styles may result in lateral communication between team members.
Motivation and job satisfaction of staff
Management style considerations:
- Did the style motivate employees to achieve their goals?
- Were appropriate motivational strategies implemented with the chosen style?
Management skills considerations:
- Were delegated tasks appropriate for staff members' abilities and development?
- Did the manager lead staff effectively, creating positive manager-employee relationships?
Staff motivation is heavily influenced by the match between style and skills. Participative styles combined with effective delegation skills often increase motivation, while autocratic styles may reduce motivation if not balanced with strong leadership skills.
Level of teamwork within the business
Management style considerations:
- Did the chosen style encourage teamwork and collaboration?
- Was the style conducive to building team cohesion?
Management skills considerations:
- Did the manager demonstrate team leadership skills?
- What level of decentralised decision-making was permitted?
Teamwork thrives when the management style and skills align. Participative styles naturally encourage teamwork, but require the manager to have strong team leadership skills and the ability to facilitate group decision-making.
Staff absenteeism and staff turnover
Management style considerations:
- How did staff absenteeism rates compare with other business units and industry averages?
- Did the style contribute to staff retention or turnover?
Management skills considerations:
- What skills were used to create a harmonious and productive workplace?
- Did the manager's skills help reduce absenteeism and turnover?
High absenteeism or turnover often indicates a mismatch between management style and the work environment. The right combination of style and skills (particularly interpersonal and communication) can create a workplace where staff want to attend and remain.
Training and development opportunities for staff
Management style considerations:
- Did the style encourage and support staff training and development?
- Was professional growth valued under the chosen style?
Management skills considerations:
- Did the manager actively make training and development opportunities available?
- Did the manager oversee staff development effectively?
Participative and laissez-faire styles typically emphasize staff development more than autocratic styles. However, the manager's planning and delegation skills determine whether training opportunities are actually provided and effective.
Performance appraisal
Management style considerations:
- Was the style appropriate for conducting fair and constructive performance appraisals?
- Did the style allow employees to demonstrate their strengths?
- Could weaknesses be addressed constructively under this style?
Management skills considerations:
- Was communication open and honest during appraisals?
- Did the manager use interpersonal skills to create a supportive appraisal environment?
Performance appraisals require a careful balance of style and skills. Even an autocratic manager needs strong communication and interpersonal skills to conduct effective appraisals. Participative styles naturally align with open, two-way performance discussions.
Real-world application: leadership at Commonwealth Bank of Australia
Case Study: Matt Comyn at Commonwealth Bank of Australia
When Matt Comyn was appointed CEO of Commonwealth Bank of Australia (CBA) in January 2018, the board of directors selected him because they believed he possessed the ideal combination of management style and skills for the challenges ahead.
The board's priorities for the CEO role required:
- Maintaining business momentum while addressing regulatory and reputational challenges
- Recognising and responding to evolving community expectations
- Transforming the business and adapting to technological changes
- Energising corporate culture and building employee pride and confidence
Management style needed:
The board valued Comyn's integrity, openness, and passion for CBA's vision. These characteristics suggest a participative management style would be appropriate, given the need to:
- Address reputational issues (requiring open communication)
- Transform the business (requiring staff input and buy-in)
- Energise culture (requiring employee engagement)
Management skills required:
To meet the board's priorities, Comyn would need strong skills in:
- Communication (to address reputational challenges and engage staff)
- Decision-making (both centralised for strategic direction and decentralised for innovation)
- Planning (to transform the business systematically)
- Leadership (to energise culture and build confidence)
- Interpersonal skills (to balance stakeholder expectations)
Key insight: This example demonstrates how senior leaders must consciously match their management style to the situation while applying specific skills to achieve organizational objectives. The relationship between style and skills is not accidental—it must be deliberately cultivated.
Exam technique: analyzing and evaluating management approaches
Essential exam strategies for management questions:
When asked to analyze management styles and skills:
- Examine the characteristics of different styles (autocratic, participative, laissez-faire)
- Identify which skills are associated with each style
- Discuss similarities and differences in how styles and skills contribute to business success
- Consider both strengths and weaknesses of the style-skill combination
When asked to evaluate appropriateness for business situations:
- Use weighted criteria related to the specific situation (e.g., urgency, staff experience, task complexity)
- Make a judgement about which style-skill combination is most suitable
- Justify your evaluation with reference to likely outcomes
- Consider multiple perspectives (task achievement, staff satisfaction, stakeholder expectations)
When asked to analyze relationships between corporate culture, management styles, and skills:
- Examine how corporate culture influences which styles are acceptable
- Identify how management styles reinforce or change culture
- Assess which skills are needed to align style with culture
- Consider the dynamic, interconnected nature of these three elements
Summary and key takeaways
Key points to remember:
- Management effectiveness requires both an appropriate style and relevant skills
- The relationship between style and skills is complementary—one influences the success of the other
- Eight key areas assess management effectiveness: outcomes, relationships, communication, motivation, teamwork, absenteeism/turnover, training, and performance appraisal
- Each area requires consideration of both the style chosen and the skills applied
- Different business situations require different style-skill combinations
- Autocratic styles typically rely on centralised decision-making, planning, and task-focused leadership skills
- Participative styles require strong communication, interpersonal, and decentralised decision-making skills
- Laissez-faire styles need delegation, trust-building, and monitoring skills
Key terms:
- Management style: The approach or manner in which a manager leads and manages staff (autocratic, participative, laissez-faire)
- Management skills: The specific capabilities a manager uses to perform their role effectively (communication, decision-making, delegation, planning, leading, interpersonal)
- Centralised decision-making: Decisions made by senior management with little input from lower levels
- Decentralised decision-making: Decision-making authority distributed to lower levels of the organization
- Staff turnover: The rate at which employees leave the business and need to be replaced
- Staff absenteeism: The rate or frequency of employee absence from work
- Open communication: Two-way communication flow in all directions (upward, downward, and lateral)
- Performance appraisal: A formal process for evaluating employee performance against objectives
Critical framework: Use Table 3.15 as a checklist when evaluating whether a manager's style and skills are appropriate for a situation. Always consider both columns—style and skills—together, not separately.
Remember!
- Management style and management skills work together—they are not independent
- The appropriateness of a style-skill combination depends on the specific business situation
- Effective managers consciously choose styles that match their skill strengths
- Assessing management effectiveness requires examining multiple areas, not just business results
- In exams, always justify your analysis or evaluation with specific reference to both style and skills