Table of Contents
Grab company background
Grab is a ride-sharing company based in Singapore. The company partners with hundreds of thousands of local drivers and partners to create an affordable on-demand transportation industry (Grab, 2020). The initial idea was formed in a Harvard Business School 2011’s Business Plan Contest by Anthony Tan and his wife Tan Hooi Ling. In 2012, it was launched by both founders in Malaysia, South East Asia (Punirselvam, 2018).
In 2020, the company has presence in 8 countries and continues to expand its service offerings, including mobile payment, financial services, and food delivery services. It has become the first ‘Decacorn’ in South East Asia valuing about 14 US billion (Punirselvam, 2018).
Leadership style theories
According to Lewin, et al. (1939), there are 3 basic leadership styles which are:
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- The authoritarian leadership style or autocratic leader
The autocratic style employs strict, close influence over its team members by watching close to the regulation of policies and procedures given to followers.
- The democratic leadership style
This style consists of the leader which shared power of decision-making with group members by promoting the interests of the group members, empowering team members and practicing social equality.
- The laissez-faire leadership style
The laissez-faire style is sometimes described as a ‘hands-off’ leadership style because the leader delegates authority to their members while providing less supervision to the members.
According to Malos (2012), there are also another important style which is:
- Transactional Leadership style
Mainly used by management, transactional leaders focus their leadership on motivating followers through a system of rewards and punishments.
Each leadership style has its advantage and disadvantage according to different company situations. For example, autocratic leadership has more advantages in fast decision making process, and able to get things done more quickly and efficiently (Malos, 2012). This style is quite appropriate in a newly formed organization where direction and oversight are strongly needed. On the other hand, People who abuse an autocratic leadership style are often viewed as bossy, controlling, and dictatorial, which can lead to resentment among group members (Malos, 2012).
Laissez-faire style is useful in situations where team members are highly skilled, motivated and capable of working on their own (Malos, 2012). A situation where strong supervision and command is not needed, and production target or results are being loosely set. Laissez-faire leadership is not ideal in situations where members lack the knowledge or experience to complete tasks and make decisions (Malos, 2012).
According to Lewin (1939), a study found that participative leadership or democratic leadership is generally the most effective leadership style. The leadership style offers more guidance to the fellow members, while also participate and allow some inputs from the members. The study showed that the members of participative leadership produce less than autocratic groups but contributed higher quality results. The democratic group also felt more engagement, motivation, and innovation (Lewin, et al., 1939). The style should be better for the long-term performance of the group, as it could be a well-balanced perspective between a top-down and bottom-up leadership process (Coleman, 2017).
A technology with a service-oriented company like Grab would need an extra room for innovation, management and strict regulation of policy and SOPs (Coleman, 2017). This would be best served with a mixture of autocratic and democratic leadership style with transactional. This meant to embrace innovation but still emphasizing the best quality service as its main competitive advantage (Coleman, 2017).
- Leadership and organizational culture in Grab
Anthony Tan is Group CEO and Founder of Grab, Southeast Asia’s leading mobile technology company focused on bringing transport freedom and financial inclusion to the region (GrabCEO, 2018). Anthony Tan as an autocratic leader is a firm believer in the Japanese philosophy of ‘See yourself, do yourself, cure yourself’, a belief he continues to pass on to his employees (Punirselvam, 2018).
The Grab’s CEO Anthony Tan has a hands-on leadership style and travels obsessively within Southeast Asia to inspire and fight with his teammates on the ground (GrabCEO, 2018). This shows decisiveness, passion, and courage trait in Grab’s Leadership. Additionally, Grab also try to balance performance with innovation to anticipate changing environment (Punirselvam, 2018). Both autocratic and participative leadership in Grab company would make a strong leadership combination along with its transactional leadership (reward system) to manage and control employee’s performance (Coleman, 2017).
The crowd speaks strongly of Grab’s culture: nimble, go-getting, fast-moving, and yet organized (CHEOK, 2018). Sharing burden among employees also show a low level of power distance and show a strong relationship among employees. Employee-centered is one key factor to Grab’s success as it sees them as partners instead of employees and nurturing their needs and requests are considered as important in the company (Daft, 2008).
This would also show a part of Grab’s participative leadership style. ‘Staying Start-up’ means staying innovative and eager to serve the best for customer satisfaction (CHEOK, 2018). Humility to stay humble and keep learning is a key personality trait in Grab’s leadership bench (Punirselvam, 2018). With an extraordinary engineering, Grab also serves with the best-designed apps for its customers and striving to be indispensable for its customers (CHEOK, 2018). The company shows a strong emphasis in innovation and competitiveness which has made them the market leader in the region (Choudhury, 2017).
- Tan Hooi Ling (Grab’s co-founder and COO)
COO Tan Hooi Ling acts as CEO Anthony’s sidekick and prefer to manage from the background. (Punirselvam, 2018). As both leaders would cooperate, and Mrs. Tan has been pushing more on the innovation side and HRD to retain better employees (democratic/ participative leader). The most important lesson Tan learned is to hire people who fit well with the company’s culture and values, even if that means turning down other talented potential candidates (Choudhury, 2017).
Having the right priorities is also important, according to Tan, that can guide small start-ups to plan better for growth and bigger companies to figure out how they’re going to stay ahead of the curve in the future with whatever resources they have (Choudhury, 2017). Learning from mistakes: Tan said that the ‘only way to continue succeeding is to continue making mistakes and learning’ from them. Tan also said being humble was also important to her leadership process. Humility and soft approach are examples of Tan’s key personality traits to nurture the growing start-up (Choudhury, 2017).
- Peter Thiel (PayPal co-founder)
Peter Thiel, a co-founder of PayPal and an investor of many companies, is well known for his libertarian view of a business (Encyclopaedia Britannica, 2019). He also invested in OpenAI, a non-profit organization known for developing a safe AI. Peter Thiel is also famous for his statement ‘competition is for losers’ and believe in monopolistic view of an economy (Thiel, 2014). As a laissez-faire leader and investor, Peter Thiel believes that a good system will make an organization function properly while delegating and trusting the team members with their experience and capabilities would gain a better innovation and results (Malos, 2012).
This is applicable when the sub-ordinates are capable, no need supervision, and no productivity target. However, in a company like Grab, where service quality measurement is highly required, and its strict mandatory for driver-partners to follow the company rules, it is more unlikely the laissez-faire style would fit to the Grab company (Coleman, 2017). The company part that needs more innovation is the feedback system and the R&D.
Conclusion
Conclusively, the autocratic leadership style combined with democratic and transactional leadership is better for certain company types than the other 2 leadership styles. A company that focuses on technology and service like Grab would be appropriate with such leadership style combination because of several reasons such as:
- Faster decision making and strong ability to ensure regulation of policies which would strengthen the company’s service quality and customer satisfaction.
- Provide room for innovation and enough feedback that would help improve the company for the long term.
- Strict reward and punishment system that would control the partner’s and employee’s performance. Rigid apps monitoring would also enhance this measurement function.
A laissez-faire style would not be appropriate in a service-oriented company like Grab, because it needs a strong degree of regulation and supervision for its quality and safety. However, a strong organization system would still be needed to uphold and maintained as the company grows larger.
References
- CHEOK, J., 2018. What the leadership looks like at Grab, now one of South-East Asia’s largest startups. [Online] Available at: https://thepeakmagazine.com.sg/lifestyle/what-the-leadership-looks-like-at-grab-now-one-of-south-east-asias-largest-startups/
- Choudhury, S. R., 2017. Grab co-founder Tan Hooi Ling shares what her ride-hailing firm has learned during its dramatic rise. [Online] Available at: https://www.cnbc.com/2017/11/29/grabs-co-founder-on-what-her-ride-hailing-firm-has-learned-in-asia.html
- CNBC Interview, 2018. CNBC Transcript: Anthony Tan, Group CEO, Grab. [Online] Available at: https://www.cnbc.com/2018/04/05/cnbc-transcript-anthony-tan-group-ceo-grab.html
- Coleman, W., 2017. Leadership Styles Of The Most Influential Thought Leaders In Tech. [Online] Available at: http://www.ec-united.com/2017/03/22/leadership-styles-of-most-influential-tech-thought-leaders/
- Daft, R., 2008. The Leadership Experience. 4 ed. USA: Thomson South-Western.
- Encyclopaedia Britannica, 2019. Peter Thiel. [Online] Available at: https://www.britannica.com/biography/Peter-Thiel
- Forbes, 2019. Forbes Asia’s Power Businesswomen List Highlights 25 Business Leaders. [Online] Available at: https://www.forbes.com/sites/forbespr/2019/09/23/forbes-asias-power-businesswomen-list-highlights-25-business-leaders/#42e22774711c
- Grab, 2020. About grab. [Online] Available at: https://www.grab.com/sg/brand-story/
- GrabCEO, 2018. Group CEO and Co-Founder of Grab. [Online] Available at: https://www.grab.com/sg/wp-content/uploads/media/docs/bio-anthony.pdf?ver=20180202
- Lewin, K., Liippit, R. & White, R., 1939. Patterns of aggressive behavior in experimentally. Journal of Social Psychology, Volume 10, pp. 271-301.
- Malos, R., 2012. LEADERSHIP STYLES. Annals of Eftimie Murgu University Resita, Fascicle II, Economic Studies, 2(6), pp. 421-426.
- Punirselvam, S., 2018. Leadership Lessons from Grab. [Online] Available at: https://www.mim.org.my/leadership-lessons-from-grab/
- Thiel, P., 2014. Competition Is for Losers. [Online] Available at: https://www.wsj.com/articles/peter-thiel-competition-is-for-losers-141053553
