Chapter 17 Leadership What Does Leadership What Does Leadership Involve? Involve? Trait Behavioral Theories Trait Behavioral Theories of Leadership of Leadership Situational Theories Situational Theories From Transactional to From Transactional to Charismatic Leadership Charismatic Leadership Additional Perspectives on Additional Perspectives on Leadership Leadership

Leadership Leadership influencing employees to voluntarily pursue organizational goals 17-2 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Leaders Vs. Managers Innovate Develop Inspire Long-term view Ask what and why Originate Challenge the status quo Do the right thing Administer Maintain Control Short-term view Ask how and when Initiate Accept the status quo Do things right LeadersManagers 17-3 Table 17-1 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Historic Vs. Contemporary Trait Theories of Leadership Intelligence Dominance Self-confidence Level of energy and activity Task-relevant knowledge people tend to perceive that someone is a leader when he or she exhibits traits associated with intelligence, masculinity, and dominance people want their leaders to be credible credible leaders are honest, forward-looking, inspiring, and competent Stogdill’s and Mann’s Findings Contemporary Trait Research 17-4 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Behavioral Theories Ohio State studies Initiating structure Consideration Michigan State studies Job-centered Employee-centered

Four Leadership Styles Derived from the Ohio State Studies LowHigh Initiating Structure Low High Consideration Low Structure, High Consideration High Structure, High Consideration Low Structure, Low Consideration High Structure, Low Consideration 17-8 Figure 17-2 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Contingency Theories Also known as Situational Theories The effectiveness of a style of leader behavior depends on the situation

Representation of Fiedler’s Contingency Model Situational Control High Control SituationsModerate Control Situations Low Control Situations Leader-member relations Good Poor Task StructureHigh Low High Low Position PowerStrongWeakStrongWeakStrongWeakStrongWeak SituationIIIIIIIVVVIVIIVIII Optimal Leadership Styles Task-motivated Leadership Relationship- Motivated Leadership Task- Motivated Leadership Figure 17-4 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

House’s Revised Path-Goal Theory Leader Behaviors  Path-goal clarifying  Achievement oriented  Work facilitation  Supportive  Interaction facilitation  Group oriented- decision making  Representation and networking  Value based Employee Characteristics  Locus of control  Task ability  Need for achievement  Experience  Need for clarity Environmental Factors  Task structure  Work group dynamics Leadership Effectiveness  Employee motivation  Employee satisfaction  Employee performance  Leader acceptance  Work-unit performance Figure 17-5 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved. Leader Behaviors Leadership Effectiveness Environmental Factors Employee Characteristics

Hersey and Blanchard’s Situational Leadership Theory Appropriate leadership style is determined by follower readiness Follower readiness is determined by followers’ ability and willingness to perform the task

Transactional Vs. Charismatic Leadership Transactional Leadership focuses on interpersonal interactions between managers and employees Leader uses contingent rewards to motivate Leader uses contingent rewards to motivate Leaders exert corrective action when subordinates fail to meet performance goals Leaders exert corrective action when subordinates fail to meet performance goals Charismatic Leadership transforms employees to pursue organizational goals over self-interest Create, communicate, model vision Create, communicate, model vision Inspire employees to strive toward vision Inspire employees to strive toward vision McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Charismatic Model of Leadership Leader behavior  Leader establishes a vision  Leader establishes high performance expectations and displays confidence in him/herself and the collective ability to realize the vision Organizational culture  Adaptive Effects on followers and work groups  Increased intrinsic motivation, achievement orientation, and goal pursuit  Increased identification with the leader and the collective interests of organizational members  Increased cohesion among workgroup members Outcomes  Personal commitment to leader and vision  Self-sacrificial behavior  Organizational commitment Figure 17-7 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Charismatic Model of Leadership Leader behavior  Leader models the desired values, traits, beliefs, and behaviors needed to realize the vision Effects on followers and work groups  Increased self- esteem, self- efficacy,and intrinsic interests in goal accomplishment  Increased role modeling of charismatic leadership Outcomes  Task meaningfulness and satisfaction  Increased individual, group, and organizational performance Organizational culture Figure 17-7 cont. McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Research and Managerial Implications Charismatic leadership is most likely to be effective when The situation offers opportunities for “moral” involvement Performance goals cannot be easily established or measured Extrinsic rewards cannot be clearly linked to individual performance There are few situational cues or constraints to guide behavior Exceptional effort, behavior, sacrifices, and performance are required of both leader and follower McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

The Leader-Member Exchange (LMX Model) This model is based on the idea that one of two distinct types of leader-member exchange relationships evolve, and these exchanges are related to important work outcomes. In-group exchange: a partnership characterized by mutual trust, respect and liking Out-group exchange: a partnership characterized by a lack of mutual trust, respect and liking McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Tips for Improving the Quality of LMX New employees should offer their loyalty, support, and cooperativeness to their manager If you are an out-group member, either accept the situation, try to become an in- group member by being cooperative and loyal or quit Managers should consciously try to expand their in-groups Managers need to give employees ample opportunity to prove themselves McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Leadership substitutes influence employee performance when leader cannot Leadership enhancers make leadership more effective Leadership neutralizers diminish leader’s ability to influence

Substitutes of Leadership Characteristic Relationship-Oriented or Considerate Leader Behavior is Unnecessary Task-Oriented or Initiating Structure Leader Behavior is Unnecessary Of the Subordinate 1) Ability, experience, training, knowledge X 2) Need for independence XX 3) “Professional” orientation XX 4) Indifference toward organizational rewards XX Table 17-4 McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Substitutes of Leadership Characteristic Relationship-Oriented or Considerate Leader Behavior is Unnecessary Task-Oriented or Initiating Structure Leader Behavior is Unnecessary Of the Task 5) Unambiguous and routine X 6) Methodically invariant X 7) Provides its own feedback concerning accomplishment X 8) Intrinsically satisfying X Table 17-4 cont. McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Substitutes of Leadership Characteristic Relationship-Oriented or Considerate Leader Behavior is Unnecessary Task-Oriented or Initiating Structure Leader Behavior is Unnecessary Of the Organization 9) Formalization X 10) Inflexibility X 11) Highly specified and active advisory and staff functions X 12) Closely knit, cohesive work groups XX Table 17-4 cont. McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.

Substitutes of Leadership Characteristic Relationship-Oriented or Considerate Leader Behavior is Unnecessary Task-Oriented or Initiating Structure Leader Behavior is Unnecessary Of the Organization Cont. 13) Organizational rewards not within the leader’s control XX 14) Spatial distances between superior and subordinates X X Table 17-4 cont. McGraw-Hill © 2004 The McGraw-Hill Companies, Inc. All rights reserved.