Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 1 Chapter One Definition and Significance of Leadership

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 2 Learning Objectives  Define leadership and leadership effectiveness.  Explain why people need leadership.  Discuss the major obstacles to effective leadership.  Compare and contrast leadership and management.  List the roles and functions of leaders and managers.  Summarize the debate over the role and impact of leadership in organizations.

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 3 Some Famous Quotes  “His ambition was a little engine that knew no rest” Abraham Lincoln’s law partner  “Those who stand for nothing fall for anything.” Alexander Hamilton  “If civilization is to survive, we must cultivate the science of human relationships—the ability of all people, of all kinds, to live together, in the same world at peace.” FDR  “Any fool can keep a rule. God gave him a brain to know when to break the rule.” General Willard W. Scott  “If you don’t know where you are going, you will probably end up somewhere else.” David Campbell, The Center for Creative Leadership

Myths that Hinder Leadership Development Good leadership is all common sense –“Common sense is the collection of prejudices acquired by age 18.” – Albert Einstein Leaders are born, not made The only school you learn leadership from is the school of hard knocks. Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 4

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 5 Definition of Leadership A leader is any person who influences individuals and groups within an organization, helps them in the establishment of goals, and guides them toward achievement of those goals, thereby allowing them to be effective

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 6 Key Elements of the Definition of Leadership  Leadership is a group phenomenon  Leadership is goal-oriented; leaders guide and influence others  Leadership involves some form of hierarchy in groups

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 7 Critical Thinking Who comes to mind as a leader? Do these individuals have anything in common? What made them effective? Were there situations at that time that were instrumental in their emergence?

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 8 Key Elements of Effectiveness  The group achieves its goals  Financial goals, quality products)  The group functions well together; there are smooth internal processes  Group cohesion, follower satis  The group can adapt well to external changes

Effective vs. Successful Managers Effective Managers  Satisfied followers  Productive  Focus on communication  Active conflict management  Motivate, train and develop employees Successful Managers  Quick promotions  Focus on networking  Interact with outsiders  Socialize  Active in office politics Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 9

Effectiveness Affective subordinate reactions (e.g., satisfaction with and/or commitment to leader) Objective subordinate reactions (absenteeism, turnover) Group dynamics (e.g., cohesion, collaboration, cooperation) Performance –Objective (e.g., ROI, sales increase, stock, profits) –Subjective Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 10

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 11 Why Do We Need Leaders?  To keep groups orderly  To keep focus on group goals  To accomplish complex tasks  To help make sense of the world by providing validation  As a romantic ideal

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 12 Obstacles to Effective Leadership  Environmental uncertainty  Organizational rigidity  Fall back on old ideas and simplistic solutions  Established organizational culture  Inaccessible research

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 13 Leadership and Management Managers  Focus on the present  Maintain status quo  Implement policy  Maintain structure  Remain aloof and objective  Use position power Leaders  Focus on the future  Create change  Initiate policy  Create culture and structure  Establish emotional link with followers  Use personal power

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 14 Managerial Roles  Figurehead  Leader  Liaison  Monitor  Disseminator  Spokesperson  Entrepreneur  Disturbance handler  Resource allocator  Negotiator

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 15 Gender Differences in Roles Male Managers  Work at unrelenting pace  Wide variety of tasks  Frequent interruptions  Little time to communicate  Few non-work activities  Feeling of isolation  Identity tied to work  Complex network  Prefer face-to face Female Managers  Calm steady pace  Frequent breaks  Did not perceive interruptions  Scheduled time for communication  Many non-work activities  Not isolated  Multi-faceted identity  Complex network  Prefer face to face

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 16 Leader’s Function in Shaping Culture LEADER Organizational Culture Organizational Culture Role Model Reward System Hiring Decisions Strategy & Structure

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 17 Impact of Leadership: Leadership Is Insignificant  Outside environmental factors affect organizations more than leadership  Internal structure and strategy determine the course organizations take  Leadership accounts for only between 7% to 15% of performance  Leaders have little discretion to really make an impact  Leadership is a romantic myth rather than a real organizational factor

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 18 Impact of Leadership: Leadership Is Significant  Leadership is one of many important factors  Leadership is key to providing vision and direction  Leadership is critical in orchestrating change  Leadership can account for up to 44% of a firm’s profitability  Leadership is critical in orchestrating change  Leadership’s impact is moderated by situational factors

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 19 The Impact of Leadership  Leadership is one of many factors  Leadership is significant in providing vision and direction  Situations are key to understanding the impact of leadership  Followers are also key to success

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 20 New Roles for Leaders Leader assumes responsibility Plan Lead Control Do Results Control-oriented LeadershipResult-oriented Leadership Lead Control Plan Do Results Leader and follower assume responsibility

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 21 Factors Fueling Change Changes in Organizations and Leadership Worldwide Political Changes Demographic Changes Employee Expectations Increased Globalization

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 22 Diversity in U.S. Population Source: U.S. Census Bureau, Census

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 23 U.S. Demographic Trends  In 2000, 13% of population spoke a language other than English  Women and minorities make up over half of the workforce  By 2016, minorities will be one third of the population  By 2025, Hispanics will outnumber African Americans  By 2025, the average age will be 40  By 2050, the average U.S. resident will be non- European

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 24 Barriers to Change  Perceived financial pressures  Short-term orientation  Top management still focused on one person  Traditional hierarchies  Employee input not fully considered  Focus on individual performance  Traditional management

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 25 Leadership Challenge Challenges for new leaders Learning new duties New roles Maintaining relationships Actions that can help Training Clear message Actions to avoid Over managing - taking charge Trying to remain “one of the boys”

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 26 Leadership in Action: David Neeleman  Quickly expanding airline  Small size; young fleet  Focus on treating people well  Neeleman provides vision and actively listens to followers  Focus on creativity and use of technology  Nimble and able to change

Chapter 1 LeadershipCopyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall 27 All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America. Copyright ©2009 Pearson Education, Inc. Publishing as Prentice Hall