Leadership

What Is Leadership? Leadership Management The ability to influence a group toward the achievement of goals Management Use of authority inherent in designated formal rank to obtain compliance from organizational members Both are necessary for organizational success Often researchers and practitioners do not distinguish between leadership and management. However, there are some key differences and understanding these differences can be helpful for organization improvement. Leadership is the ability to influence a group toward the achievement of goals. A leader does not have to be someone who holds a formal position or title. They can emerge from a group and provide vision and motivation to those around them. Management deals with the complexity of the organization and works with planning, organizing, leading and controlling to bring about order and consistency in the organization. Even though the two roles have different areas of focus, both are necessary for organizational success. (c) 2008 Prentice-Hall, All rights reserved.

Trait Theories of Leadership Theories that consider personality, social, physical, or intellectual traits to differentiate leaders from nonleaders Not very useful until matched with the Big Five Personality Framework Essential Leadership Traits Extroversion Conscientiousness Openness Emotional Intelligence (Qualified) Traits can predict leadership, but they are better at predicting leader emergence than effectiveness. The trait theory of leadership looks at personality, social, physical, or intellectual traits that differentiate leaders from nonleaders. Initially this theory was based on studies that looked at over 80 different traits, which allowed almost anything to be defined as leadership. A breakthrough occurred when researchers began to organize the traits into categories and this became known as the Big Five Personality Framework where five groups of traits were found to be consistently present among leaders. Some essential leadership traits include extroversion, conscientiousness, openness, and emotional intelligence (EI), although the link between EI and leadership has not been fully explored. With the many years of research dedicated to the trait theory of leadership, it is widely accepted that traits do predict leadership. However, it is more likely that they predict the emergence of a leader than the effectiveness of a leader. (c) 2008 Prentice-Hall, All rights reserved.

Behavioral Theories of Leadership Theories proposing that specific behaviors differentiate leaders from nonleaders Differences between theories of leadership: Trait theory: leadership is inherent, so we must identify the leader based on his or her traits Behavioral theory: leadership is a skill set and can be taught to anyone, so we must identify the proper behaviors to teach potential leaders In response to some disappointments with the trait theory, researchers began to look at defining leadership by how people behaved. This shifted the thinking on leadership from the belief that you could select leaders based on inborn traits to training leaders to behave in certain ways. (c) 2008 Prentice-Hall, All rights reserved.

Important Behavioral Studies Ohio Initiating structure Consideration Michigan Employee-oriented Production-oriented Two key studies in the area of behavioral leadership advanced our understanding of the theory. The first was done at Ohio State University. They looked at important dimensions of leadership behavior and began with over 1000 dimensions. In the end the Ohio State studies were able to narrow it down to two dimensions – initiating structure and consideration. Initiating structure is when the leader is able to define and structure their role and that of their employees to work toward the goals of the organization. Consideration is the ability of the leader to gain the trust and respect of their followers and to help them feel appreciated for what they do. Both behaviors have proven to be very important in an effective leader. The University of Michigan Studies identified two key dimensions of leadership behavior as well. They are similar in nature to the Ohio State findings. However, the University of Michigan studies classified these behaviors as employee-oriented which looks at the interpersonal relationships between the leader and their followers; and production-oriented which focuses on the technical aspect of the job. Again, both are important for successful leadership. (c) 2008 Prentice-Hall, All rights reserved.

Contingency Theories While trait and behavior theories do help us understand leadership, an important component is missing: the environment in which the leader exists Contingency Theory adds this additional aspect to our understanding leadership effectiveness studies Three key contingency models for leadership: Fiedler’s Model Hersey and Blanchard’s Situational Leadership Theory Path-Goal Theory We can learn a lot from trait and behavior theories, but they do not tell the whole story. It is important to understand the environment that the leader is in to fully understand leadership effectiveness. The Contingency Theory takes the context in which the leader is operating into consideration and tries to isolate the conditions that allow for effective leadership. There are three key theories that enhance our understanding of leadership by explaining situational variables. They are Fiedler’s Model, Hersey and Blanchard’s Situational Leadership Theory, and the Path-Goal Theory of Leadership. (c) 2008 Prentice-Hall, All rights reserved.

Fiedler Model Effective group performance depends on the proper match between leadership style and the degree to which the situation gives the leader control. Assumes that leadership style (based on orientation revealed in LPC questionnaire) is fixed Considers Three Situational Factors: Leader-member relations: degree of confidence and trust in the leader Task structure: degree of structure in the jobs Position power: leader’s ability to hire, fire, and reward For effective leadership: must change to a leader who fits the situation or change the situational variables to fit the current leader In this theory Fiedler is trying to match the leader to the context. He proposes that leadership style is fixed. So that if the situation needs a charismatic leader and your current leader does not exhibit that style, you need to change leaders. This leadership style can be determined by taking the LPC questionnaire (least preferred coworker). After the leadership style is determined, you can match the leader to the situation. There are three dimensions to find a successful match. The first situational factor is the leader-member relationship; this ties back to our behavioral studies by looking at the degree of trust and respect the employees have for the leader. The second factor is the amount of structure that is embedded in job assignments. The last factor is the amount of influence the leader has over decisions that represent power such as hiring, firing, and rewards. In Fiedler’s model you need to find a leader to fit the situation or change the situation to fit the leader in order to achieve effective leadership for the organization. (c) 2008 Prentice-Hall, All rights reserved.

Graphic Representation of Fiedler’s Model Used to determine which type of leader to use in a given situation This graph helps to visually determine the situational factors and what type of leader would succeed in this situation. There are eight possible situations in which a leader can find themselves in. By matching their LPC score with these eight different situations, a leader can see where they will be most effective. For example, categories four through six would be better suited to relationship-oriented leaders because Fiedler proposes that they perform best in moderately favorable situations. E X H I B I T 12-1 (c) 2008 Prentice-Hall, All rights reserved.

Assessment of Fiedler’s Model Positives: Considerable evidence supports the model, especially if the original eight situations are grouped into three Problems: The logic behind the LPC scale is not well understood LPC scores are not stable Contingency variables are complex and hard to determine Fiedler’s Model is based on a great deal of evidence that has supported his assertions and he has moved us forward in our understanding of effective leadership. However, it is not without its problems. The LPC scale is a tool that is not easy to understand so it is difficult to utilize the tool in the workplace. The LPC scores have not remained stable with all participants, thereby causing one to question Fiedler’s premise that leadership traits are stable. Finally, the contingency variables used in this model are extremely complex and hard to measure, causing difficulty in applying this model to the organizational context. (c) 2008 Prentice-Hall, All rights reserved.

Situational Leadership Theory A model that focuses on follower “readiness” Followers can accept or reject the leader Effectiveness depends on the followers’ response to the leader’s actions “Readiness” is the extent to which people have the ability and willingness to accomplish a specific task Ability to follow Willingness to Follow Leadership Behavior Unable Unwilling Give clear and specific directions Willing Display high task orientation Able Use a supportive and participatory style Doesn’t need to do much Although Fiedler’s model with the LPC framework is the most researched contingency theory, it is important to look at a few other models. The Situational Leadership Theory offers a model that takes a look at the other side of the equation, the followers. The focus of this theory is on the readiness of the follower to follow. Each follower can decide for themselves whether they will accept or reject the leader. If the leader is to be effective, the followers much choose to accomplish the task the leader has given them. The situational leadership theory looks at readiness and defines it as the extent to which people have the ability and willingness to accomplish a specific task. A leader should choose one of four behaviors depending on follower readiness. If followers are unable and unwilling to do a task, the leader needs to give clear and specific directions; if they are unable and willing, the leader needs to display high-task orientation to compensate for followers’ lack of ability and high relationship orientation to get them to “buy into” the leader’s desires. If followers are able and unwilling, the leader needs to use a supportive and participative style; if they are both able and willing, the leader doesn’t need to do much. (c) 2008 Prentice-Hall, All rights reserved.

Hersey and Blanchard’s Situational Theory of Leadership Appropriate Leader Style Follower Characteristics Low readiness level Moderate readiness level High readiness level Very high readiness level Telling (high task-low relationship) Selling (high task-high relationship) Participating (low task-high rel.) Delegating (low task-low relationship)

House’s Path-Goal Theory Builds from the Ohio State studies and the expectancy theory of motivation The theory: Leaders provide followers with information, support, and resources to help them achieve their goals Leaders help clarify the “path” to the worker’s goals Leaders can display multiple leadership types Four types of leaders: Directive: focuses on the work to be done Supportive: focuses on the well-being of the worker Participative: consults with employees in decision making Achievement-Oriented: sets challenging goals The Path-Goal Theory builds upon previously discussed models to define the role of the leader. In this theory it is the job of the leader to provide the followers with the information, support, and other necessary resources to equip them to achieve their goals. The very name of the theory “path-goal” implies that if a leader is going to be effective, they must clarify the follower’s path to the goals of the organization and in fact make the journey easier by removing roadblocks. The Path-Goal Theory allows for many different types of leaders to be successful. However, the four main types of leaders discussed in this theory are: Directive, Supportive, Participative, and Achievement-Oriented. The Directive approach focuses on the work tasks that need to be accomplished, the Supportive approach is more about relationships and the well-being of the worker. In a Participative approach the leader works with the employees to include them in the decision-making process and in the Achievement-Oriented approach the leader sets challenging goals and encourages the workers to accomplish those goals. (c) 2008 Prentice-Hall, All rights reserved.

Path-Goal Situations and Preferred Leader Behaviors Impact on Follower Outcome Followers lack self-confidence Supportive Leadership Increases confidence to achieve work outcomes Directive Leadership Increased effort; improved satisfaction and performance Ambiguous job Clarifies path to reward Achievement-Oriented Leadership Lack of job challenge Set and strive for high goals Participative Leadership Clarifies followers’ needs to change rewards Incorrect reward

Vroom and Yetton’s Leader-Participation Model How a leader makes decisions is as important as what is decided Premise: Situational variables interact with leadership attributes to impact the behavior of the leader. Leader behaviors must adjust to the way tasks are structured in the organization. This is a normative model that tells leaders how participative to be in their decision making of a decision tree Five leadership styles Twelve contingency variables Victor Vroom stated “I do not see any form of leadership as optimal for all situations. The contributions of a leader’s actions to the effectiveness of his organization cannot be determined without considering the nature of the situation in which that behavior is displayed.” The Vroom Yetton participation model is based on the fact that situational variables interact with leadership attributes and characteristics in a way that it impacts the behavior of the leader. This contingency model provides an approach for leaders to follow based on the task structure, leadership style, and various other contingency factors. (c) 2008 Prentice-Hall, All rights reserved.

Vroom and Yetton’s Leader-Participation Model

Vroom and Yetton’s Leader-Participation Model: Factors Autocratic Type 1 (AI) – Leader makes own decision using information that is readily available to you at the time. This type is completely autocratic. Autocratic Type 2 (AII) – Leader collects required information from followers, then makes decision alone. Problem or decision may or may not be informed to followers. Here, followers involvement is just providing information. Consultative Type 1 (CI) – Leader shares problem to relevant followers individually and seeks their ideas & suggestions and makes decision alone. Here followers‟ do not meet each other & leader’s decision may or may not has followers influence. So, here followers involvement is at the level of providing alternatives individually. Consultative Type 2 (CII) – Leader shares problem to relevant followers as a group and seeks their ideas & suggestions and makes decision alone. Here followers‟ meet each other and through discussions they understand other alternatives. But leader’s decision may or may not has followers influence. So, here followers involvement is at the level of helping as a group in decision-making. Group-based Type 2(GII) – Leader discuss problem & situation with followers as a group and seeks their ideas & suggestions through brain storming. Leader accepts any decision & do not try to force his idea. Decision accepted by the group is the final one.

Leader-Member Exchange (LMX) Theory In-Group Members are similar to leader In the leader’s inner circle of communication Receives more time and attention from leader Gives greater responsibility and rewards Out-Group Managed by formal rules and policies Receive less of the leader’s attention / fewer exchanges More likely to retaliate against the organization Contingency theories have failed to account for followers and heterogeneous leadership approaches to individual workers. The Leader-Member Exchange theory begins to account for this. In this theory the premise is that because of time pressures leaders very quickly form special relationships with a small group of employees, the “in-group.” This group tends to be like the leader in terms of gender, race, age, and other characteristics. This group quickly becomes part of the leader’s inner circle of communication and will receive more time and attention from the leader. This group will experience more stress because of the added workload. The “outgroup” is made of people who tend to be different than the leader and correspondingly receive fewer exchanges. As a result they are more likely to experience stress because of their relationship and may retaliate against the organization as they become discontent with their assignments. (c) 2008 Prentice-Hall, All rights reserved.

Charismatic Leadership Charisma means gift in Greek Vision Personal Risk Sensitivity to Followers Unconventional Behavior Charisa comes from the Greek word meaning gift. When talking about a charismatic leader one will refer to someone with certain gifts or abilities. A charismatic leader will often gain followers through personality rather than through power or authority. This chart takes a look at key characteristics that are associated with a charismatic leader. These are often traits that a leader is born with, thus continuing the debate whether leaders are born or developed. The leader must have vision, expressed as an idealized goal. The leader must be willing to take on high personal risk and engage in self-sacrifice to achieve the vision. In doing so the leader needs to remain sensitive to the feelings and needs of their followers. Throughout the process the leader must be engaging in behaviors that are perceived as counter to norms. (c) 2008 Prentice-Hall, All rights reserved.

Charismatic Leadership How do charismatic leaders influence followers? Articulate a Vision Create a Vision Statement Create a new set of Values Demonstrate the Vision Evidence shows a four-step process can help the charismatic leader utilize their characteristics to influence their followers. First the leader articulates a long-term strategy for achieving a goal. This strategy should fit the vision and uniqueness of the organization. Next the leader needs to formalize that vision by creating a vision statement. Charismatic leaders will often use this statement to reinforce the goal and purpose of the organization. This vision is communicated in a way that expresses the leader’s excitement and commitment to the goal. Next the leader will use his words and actions to communicate a new set of values for the followers to imitate. Then the charismatic leader will try to find behaviors that demonstrate their commitment to the vision. They will choose behaviors that will help followers “catch” the emotions the leader is conveying and help achieve buy-in of the followers. Finally, the charismatic leader engages in emotion-inducing and often unconventional behavior to demonstrate courage and conviction about the vision to help the followers “catch” the vision. (c) 2008 Prentice-Hall, All rights reserved.

Transformational Leaders Inspire followers to transcend their self-interests for the good of the organization Transactional Contingent Reward Management by Exception (active) Management by Exception (passive) Laissez-Faire Transformational Idealized Influence Inspirational Motivation Intellectual Stimulation Individualized Consideration Transformational leaders help followers to look at the bigger picture and commit to the good of the organization, even if it means setting their own goals aside. This chart looks at the different characteristics of transactional and transformational leadership. These two approaches are not contradictory in nature – in fact they can complement each other. Transformational leadership often is built upon transactional leadership. Good leadership will incorporate both transactional and transformational components. (c) 2008 Prentice-Hall, All rights reserved.

Leadership Model Transaction Approaches Laissez-Faire Management by Exception Contingent Reward Transformational Approaches Individualized Consideration Intellectual Stimulation Inspirational Motivation Idealized Influence This exhibit shows the full range of the leadership model. The first four behaviors represent transactional approaches and begins with the Laissez-Faire approach, which is the most passive. As a leader progresses on the scale they move toward more active behaviors. The final four behaviors on the model represent transformational actions. This model shows that as leaders utilize more transformational behaviors they become more effective. (c) 2008 Prentice-Hall, All rights reserved.

(c) 2008 Prentice-Hall, All rights reserved. Authentic Leaders Authentic leaders know who they are, what they believe in and value, and act upon those values and beliefs. Ethics and Leadership Leadership is not free from values. When we assess leadership, we must assess not just the goals themselves but also the means by which those goals are achieved. Authentic leadership is a growing area of research. There are two components that need to be addressed when discussing authenticity in leadership. First we must look at authentic leaders. These are leaders who engage in reflection and understand who they are, what they believe and bring those two aspects together in their actions. The second component is the intersection of ethics and leadership. Over the past several years, we have been involved in what many have called an ethical crisis in the business community. When we look at leadership, we need to look at more than the results of the leader – we must also look at the steps the leader took to achieve those results. (c) 2008 Prentice-Hall, All rights reserved.

Trust and Leadership Trust – a psychological state that exists when you agree to make yourself vulnerable to another because you have a positive expectation for how things are going to turn out. Key attribute associated with leadership Followers who trust their leader will align their actions and attitudes with the leader’s behaviors/requests Trust Desired Actions Desired Attitudes Trust is defined as a state that exists when you agree to make yourself vulnerable to another because you have a positive expectation for how things are going to turn out. Over the years this has been found to be a foundational characteristic of leadership. When trust is present, followers are willing to do as the leader asks and engage in behaviors that are for the benefit of the organization. In short, followers will do a lot more for a leader they trust than for one that does not hold their trust. (c) 2008 Prentice-Hall, All rights reserved.

How is Trust Developed? Leadership Action: Integrity, Benevolence, Ability Trust Action: Risk Taking, Information Sharing, Group Effectiveness, and Productivity Trust is developed over time. The interactions between the leaders and the followers are part of the development of trust – it goes both ways. Research has shown that the three main characteristics of a leader that instill trust are integrity, ability, and benevolence. These three characteristics are important in developing trust between leaders and followers. If followers perceive these characteristics as strong in their leaders, it will encourage positive behaviors such as risk taking, information sharing, group interactions, and productivity. (c) 2008 Prentice-Hall, All rights reserved.

Mentoring – Leading for the Future Mentor: A senior employee who supports a less experienced employee. Career Functions Helping the protégé gain skills and abilities Lobbying for the protégé to get better assignments Providing exposure to influential individuals in the organization Acting as a sounding board for ideas Psychological Functions Counseling the protégé to bolster his/her confidence Sharing personal experiences with the protégé Providing friendship and acceptance Acting as a role model Mentoring is defined as someone with more experience supporting someone with less experience. It is a way for the leadership of this generation to invest in individuals and develop future leaders. Mentoring has positive effects on both the career and the psychological functions of the individual being mentored. (c) 2008 Prentice-Hall, All rights reserved.

Finding and Creating Effective Leaders Selecting Leaders Training Leaders Leaders don’t just happen to show up at the organization. They must be found and developed. When looking for leaders, it is important to understand what leadership characteristics and style will best match with your organization and find ways to identify leaders with those attributes. Once you have a leader or recognize leadership potential, it is essential to train and develop your leaders to effectively develop followers within your context. (c) 2008 Prentice-Hall, All rights reserved.

GLOBE does have some country-specific insights These leadership theories are primarily studied in English-speaking countries GLOBE does have some country-specific insights Indian employees want action-oriented and charismatic leaders. Brazilian teams prefer leaders who are high in consideration, participative, and have high LPC scores French workers want a leader who is high on initiating structure and task-oriented Egyptian employees value team-oriented, participative leadership, while keeping a high-power distance Chinese workers may favor a moderately participative style. Leaders should take culture into account Most of the theories we have explored are based on research gathered in English-speaking countries. When you look at research in other areas, you will find different variables that will impact both leaders and followers. It is very important when engaging in cross-cultural business opportunities that the difference in culture is considered. This is true when doing business in other countries, but it is also important to remember that many organizations are cross-cultural because of the make-up of their employees. The GLOBE study looked at 18,000 leaders in over 800 organizations in 62 countries. They found that the characteristics that determined transformational leadership were consistent across cultures. This is significant because it disputes the contingency view that leadership is dependent upon culture. (c) 2008 Prentice-Hall, All rights reserved.

Summary and Managerial Implications Leadership is central to understanding group behavior as the leader provides the direction. Extroversion, conscientiousness, and openness all show consistent relationships to leadership. Behavioral approaches have narrowed leadership down into two usable dimensions. Need to take into account the situational variables, especially the impact of followers. Research on charismatic and transformational leadership has made major contributions to our understanding of leadership. Leaders must be seen as authentic and trustworthy. Investment must be made in the future through mentoring and training leaders. Leadership is a complex function in an organization but essential for success. Individuals, groups, and organizations all need leaders, and there are many factors that define a successful leader. Each organization must assess what they need in their leader in order to be effective. (c) 2008 Prentice-Hall, All rights reserved.