Leadership is most essential in a team environment. It has the absolute power to make or break the cohesiveness of a team. A leader has the responsibility of ensuring the unity of the team, to bring forth the desired result. With more young people coming directly into management positions, leading a team from day one, they are left with no alternative but to develop leadership skills on the job.

Problems faced by newbie managers

Many new entrants in managerial positions, struggle hard, undecided about whom to turn to for advice and help – unsure whether their approach is a success or not. New managers have a hard task deciding when to be forceful and when to loosen up. Whether it is productive to be distant or friendly to the subordinates is a dilemma faced by them.

Being woman increases the hardship ten-fold, as they have to carry the additional burden of authenticating their selection and job suitability in the male-dominated world.

Searching for solutions

A mentor from a higher management position can help young people overcome the initial hiccups. If the mentor is closely associated with their work, even better. With their vast experience and keen observation skills, mentors can provide the necessary guidance. However, finding a mentor is not an easy task in this dog-eat-dog world.

Another option is to find a role model within the organization and draw inspiration from his/her leadership skills. It is immensely beneficial for youngsters to watch a successful leader at work at close quarters. Paucity of role models, especially for women managers, is a drawback. The difference in personalities of the people involved may also limit its utility.

Developing a good rapport with the boss is one of the best solutions that can be applied in most cases. As a person closely monitoring the team, a boss will be able to provide proper guidance in those difficult days and help in developing a unique leadership style.

Best leadership styles

A best leadership style, readymade for all situations, is an illusion. Each individual has to develop a repertory of styles for use in specific situations. This depends on the people involved, demands to be met and many more.

Leadership styles can be broadly classified as visionary, coaching, democratic, affiliate, pacesetting and commanding, based on the team status quo and personalities of team members. Each comes with its own merits and demerits. When utilized in situations where advantages are more pronounced, their disadvantages become inconsequential.

Visionary style is appropriate for teams without direction or goal. A visionary leader can get the people moving towards a dream goal. Here goal is fixed, but the choice of path is left to team members. Coaching style is more suited for developing individuals, but can turn too stifling, when applied incorrectly.

Democratic style calls for inputs from team members and use the collective knowledge to move forward. Delay in decision-making is its main drawback. Affiliate style encourages team effort by building rapport among team members. However, exceptional talent and mediocrity may co-exit in this style.

Pacesetting style is taxing for team members, when the leader sets too high a standard for them to follow. It can lead to dissatisfaction and low morale in the team. Commanding style is abandoned even by its proponents, viz. the army. Fast turnaround during a crisis is its only advantage.

Those who have led successful teams, stress the need to borrow from all the styles to suit the occasion. However, in general, leaders should be firm, open, compassionate, clear and direct in their approach towards team members, to be successful.

written by REI Circle (www.reicircle.com)

Several Retailers were able to lure various deal-hungry shoppers into their shops on Black Friday. It really tested the US economy.

The Chief Executive of Best Buy Co., observed customers snapping up lower priced electronics such as netbook computers, small flat-screen televisions and digital cameras. He also stated that this year is not the one where there will be an increase in purchasing power of the consumers and that there can be some losers as well as winners in retail.

After the miserable sales last year which led to panic-affected discounting, this year the stores have tried their best to cut the costs, brighten inventories, and stock recession friendly commodities. In order to protect their profit margins, retailers are also trying their best to restrict the depth and scope of discounts they offer.

The largest specialty apparel retailer of the US, Gap Inc. is offering a buy-one-get-one free promotion on all the sweaters. This deal is similar to what they had offered last year but is been strategically planned and the goods are sourced at a lower price.

Black Friday was closely monitored by several Wall Street analysts and economists to closely watch the signs of how the US economy was pouncing back from the shocks of recession.

With the unemployment rate touching new highs (currently above 10%) and housing prices becoming steady in several places, this holiday season will be really challenging for retailers.

The sudden plunge in sales compelled fire sale discounts at Macy’s Inc., the Company realized the need of balancing its profits, had to work sharper and had to lower their prices. However, the response they got to their product such as that to half-carat diamond stud earrings was very flattering after its price was slashed down to $199 from its initial amount of $600.

The early indication pointed towards steady store traffic especially at the discount stores, which became the cynosure of the Black Friday shopping veterans. However, customers were very watchful about their dollars and were buying only those things that could give them good bargain.

However, some industry experts state that majorities of merchants are heading into the holiday season with a better financial condition then they were in the last year.

The National Retails Federation has predicted a 1% drop in the US holiday sales from a year ago, thus marking a consecutive down year but with an improved performance than last year’s decline of 3.4%.

According to the figures released by the Commerce Department, Consumer spending which accounts for two-third of the US economy, performed better than it was expected and landed at 0.7% in October. This has given new hopes that holiday purchasing can surpass the prophecies.

Admittedly, some shoppers are very determined to spend at least few bucks at the discount malls. Another glimmer of hope in the retail picture is the online sales. However, here also majority of people are being lured by deep discounts sites such as Amazon.com Inc.

Retails executives are expecting a more favorable outcome than they were expecting couple of months ago. More than half of the retail chain executives expect sales to increase between 5% and 15%, which is almost double the number predicted earlier in September.

According to the Us Inc., the year 2009 is going to be an aggressive year concerning sales. Overall, the Holiday season has started with a bang and has shown some ray of hope to the retailers who had to feel the brunt of the financial turmoil. It also epitomizes the US economy’s rebound from the financial shock experienced last year.

written by REI Circle (www.reicircle.com)

The recent financial crisis was one of the worst periods in the economic history of the US. It saw the fall of major corporate lenders such as Circuit City Stores Inc., General Motors Corp. and CIT Group Inc. to fewer organizations.

Currently, the corporate failures are slowing down, thanks to refinancing of balance sheets of companies with fresh debt, pushing out maturities on existing loans or usage of distressed-debt exchanges, to avoid a bankruptcy filing.

As per data provider Dealogic, speculative grade companies (also known as junk grade) have already issued over $123 billion in new bonds this year as compared to $48 billion in the whole of last year. According to Barclay’s capital analysts, at this pace, this year’s amount may challenge the record issuance of $143 billion in 2006.

The current trend of refinancing is troubling some analysts who believe that it is not healing the real problems and is just providing a superficial relief. As per FTI Consulting (a business advisory firm), weaker companies will contribute $1.4 trillion in loans and bonds in the next five years. When the crisis was at its peak in January, Moody’s Investors Service had estimated that about 16.4% of speculative grade companies would have defaulted in the last one year. It has been approximated by some analysts that the default rate will reach its height only after early 2010.

As per Moody’s, the US default rate will hit its upper limit at 13.6% this month and dip down to 4.4% in a year from now. According to Lynn LoPucki, a law professor at University of California who tracks filings by publicly listed companies with assets over $261 million, only three large publicly traded companies had registered for bankruptcy court protection in the month of September, whereas six companies filed for it in October which is again lesser than 16 companies in March.

Normally, high debt issuance means economic vitality because the money is used by companies to expand; however, today, new debt has come to mean almost 100% refinancing. Barclays Capital restructuring Chief Mark Shapiro believes that, despite the recent pause in corporate failures, the number of bankruptcies could see a spike in the coming weeks. In fact, recent times have seen some high profile companies such as Capmark Financial and CIT file for bankruptcy. He also added that the timeframe in which weaker companies can borrow funds will be very limited and the access to high yield markets by small companies is helping stave off many bankruptcies that would have otherwise occurred in the following year.

Hard pressed companies that were kept out of credit markets during winter due to investors’ demand of more than 20% yield on junk bonds, ultimately now the average bond yields are only about 10% (as per Merryl Lynch U.S High Yield Master II Index).

Federal Reserve has opened up the credit market by keeping the interest rates close to zero. If the Federal interest rate policy changes, the debt ridden companies will find it very difficult to refinance billions of dollars in debt coming up as due for payment.

Many companies that needed debt were helped by the government, which offered extremely low yields on safe securities such as Treasury. Thus, people were forced to purchase riskier securities such as junk bonds for a reasonable return. For instance, there were serious doubts whether the movie-rental chain Blockbuster Inc. would be able to avoid bankruptcy or not; however, the chain managed to raise $675 million by selling new bonds. This amount was twice as much as it had wanted in the first place.

Companies such as Harrah’s Entertainment Inc. and MGM Mirage have also scripted similar success stories. Investors don’t mind putting their money into such companies because the bondholders can exchange existing debt for a new debt that matures at a later date or equity in a reconstituted company or both.

According to Michael Imber, involved in restructuring work for the financial advisory firm Grant Thornton LLP, in spite of taking suggested steps, a phenomenal amount of debt is going to be due in the next five years. Along with many other experts, he also believes that a high rate of unemployment and frail market conditions will continue to trouble several businesses.

Overall, no one can forecast revenue, what is certain is, the large number of problems that we are going to face in the future.

written by REI Circle (www.reicircle.com)