Leadership, Influence, and Communication in Business Chapter Six Leadership, Influence, and Communication in Business © 2007 The McGraw-Hill Companies, Inc., All Rights Reserved. McGraw-Hill/Irwin Introduction to Business

Learning Objectives Appreciate the way a manager’s ability to effectively lead, influence, and persuade other people influences a company’s efficiency, effectiveness, and profitability. Identify the five sources of a leader’s power and understand how leadership involves the effective use of power to influence other people. Differentiate between four main approaches to leadership and recognize that effective leadership involves matching a leadership approach to the characteristics of employees and the work situation.

Learning Objectives Identify five characteristics of effective leaders. Understand the vital role communication plays in influencing others in a business organization and describe a model of persuasive communication. Define organizational politics and understand how political tactics are used to influence and persuade others.

Business Leadership Leadership the use of one’s personality, beliefs, values, social skills, knowledge, and power to influence other people’s thoughts feelings and behaviors

Business Leadership Effective leader a person who can persuade his subordinates to work hard and perform at high levels

Question? What is the ability of one person to make other people do something that they would not have otherwise done? Leadership Expertise Power Clout The correct answer is “C” – power. See next slide.

Sources of a Leader’s Power the ability of one person to make other people or groups do something that they would not have otherwise done

Sources of a Leader’s Power Figure 6.1

Question? What type of power is a leader’s ability to sanction employees who fail to meet job and company requirements? Legitimate power Reward power Coercive power Referent power The correct answer is “C” – coercive power. See slide 6-12.

Sources of a Leader’s Power Legitimate power the rightful authority to direct and control employees’ activities Reward power a leader’s ability to recognize and acknowledge employees who perform their jobs in a way that meets or exceeds the requirements of their job or company

Sources of a Leader’s Power Coercive power a leader’s ability to sanction or punish employees who fail to meet job and company requirements Incentive system a system of rewards and sanctions that shapes, influences, and controls the way employees behave at work

Sources of a Leader’s Power Expert power a person’s recognized expertise or superior skill in a particular functional area of business Referent power a leader’s ability to influence and persuade other people because of personal qualities that make them attractive to others and effective in social situations

Sources of a Leader’s Power Charismatic leader an exceptionally effective leader whose referent and expert power results in followers perceiving them as someone who personifies a company and what it stands for Read a short biography of a charismatic leader who changed an industry

Leader Power and Employee Behavior and Attitudes Leaders use their power to influence and control the way employees perform their jobs and work to achieve a company’s mission Effective leadership results when managers use their power in ways that improve specific kinds of behaviors and attitudes

Important Work Behaviors and Attitudes Figure 6.2

The Contingency Theory of Leadership the theory that effective leadership occurs when managers adopt a leadership approach that matches the characteristics of their employees and the work setting

The Contingency Theory of Leadership Figure 6.3

Four Types of Leadership Approaches Directive leadership Supportive leadership Participative leadership Achievement-oriented leadership

Four Approaches to Leadership Figure 6.4

Types of Contingencies Employee contingencies Level of occupational skills, knowledge, and experience employees need to perform their jobs A person’s need for achievement and their locus of control

Contingency Factors and the Effective Approach to Leadership Figure 6.5

Employee Contingencies Need for achievement a person’s desire or drive to excel at a certain activity Internal locus of control believe they are in control of their situation External locus of control believe how well they perform depends much more on the nature of the situation they are in and factors out of their control

Types of Contingencies Work-situation contingencies Routine vs. non-routine jobs Level of cohesiveness present in a work group

Five Characteristics of Effective Leaders Figure 6.6

Characteristics of Effective Leaders Intuition, intelligence, and cognitive ability Energy, drive, and a need for achievement Self-confident and internal locus of control Ethics and moral integrity Emotional intelligence and empathy

Influence, Persuasion, and Communication the transmission and sharing of information between people or groups so that each party understands what the other is trying to achieve

Influence, Persuasion, and Communication Persuasive communication the attempt by a party to share information with another party in order to get them to understand their objectives and work toward them

Types of Situations for Persuasive Communication Figure 6.7

Becoming a Persuasive Communicator Sender the party that transmits a message or other information to a receiver Receiver the party that receives the information transmitted by a sender

A Model of Persuasive Communication Figure 6.8

Becoming a Persuasive Communicator Characteristics of the sender Active listening Content of the message Method of communication Characteristics of the receiver

Characteristics of the Sender Credible Possess good speaking and listening skills

Active Listening Pay attention not only to the words that are being said but also to the many other things that are going on in the communication process Nonverbal cues

Methods of Communication Figure 6.9

Characteristics of the receiver Devil’s advocate someone who tries to convince others that an idea or plan is flawed

The Political Process in Business Organizations Organizational politics the activities managers and employees engage in to increase their power and persuade others to achieve their personal goals and objectives

The Political Process in Business Organizations Political tactics the specific strategies managers and employees engage in to gain the support of an organization’s members

Types of Political Tactics Figure 6.10

Political Tactics The attack-and-blame versus make-everyone-a-winner tactic The reduce-uncertainty and use-objective-information tactic The be-irreplaceable or occupy-a-central-position tactic The building-coalitions-and-alliances tactic

Video: Sylvia Rhone of Electra Records The music industry has been traditionally characterized as a white-male dominated business. That had been largely true until Sylvia Rhone was elevated to the position of Chair and CEO of Elektra Records. What type of leader do you think Sylvia Rhone is? Discussion Questions: How does Sylvia Rhone reduce uncertainty? Answer: It appears that she is a risk taker with well-honed instincts. She is not afraid to make mistakes. Uncertainty can be a threat for executives in that it can reduce performance. In Rhone’s case, however, her ability to act decisively appears to minimize uncertainty given her high level of performance while at Elektra Records. What type of leader do you think Sylvia Rhone is? Answer: Based on the interviews with others in the music industry, it appears that Rhone would be considered a charismatic leader. She takes risks, has great intuitive skills, and has been highly successful. There seems to be an excitement around her as others speak about her abilities and effectiveness. Further, she rose to the level of CEO from that of a $12,000 secretarial position. 3. Of the four types of leadership approaches, which is most applicable to Rhone? Answer: The four principal types of leadership approaches are (1) directive, (2) supportive, (3) participative, and (4) achievement-oriented. Based on the information provided in the video, one would have to conclude that Rhone is achievement-oriented. This can be supported by her rise to Chair and CEO and the financial performance of the company during her tenure.