BUSM 4177 / 4194 Leading for Change Topic 7: Charismatic Leadership

Charismatic and transformational leadership Understand: Learning Objectives Charismatic and transformational leadership Understand: how the theories of charismatic and transformational leadership differ from earlier leadership theories. similarities and differences among the major theories of charismatic and transformational leadership. how attributions of charisma are jointly determined by the leader, the followers, and the situation. what traits, behaviours, and influence processes are involved in charismatic and transformational leadership. the benefits and costs of charismatic leadership for followers and the organisation. how to apply the theories to become more effective as a leader.

Charisma and charismatic leadership A special quality of leaders whose purpose, powers and extraordinary determination differentiate them from others (Conger & Kanungo 1988)

Charisma and charismatic leadership

Charismatic leaders cant succeed without dedicated “followers” Charismatic leadership points of difference with earlier leadership theories Charismatic leadership theory calls on emotional and symbolic aspects of leadership Charismatic leaders cant succeed without dedicated “followers” You cannot be charismatic on your own, have to command an audience Differentiate between creativity and innovation Steve jobs and Steve Cameron

Early contributions to charismatic leadership 1947: Weber used the term “charisma” to explain a form of influence based not on traditional or legal–rational authority systems but rather on follower perceptions that a leader is endowed with the gift of divine inspiration or supernatural qualities Weber, M. (1947) The Theory of social and economic organization (A.M. Henderson & T.Parsons Trans.) New York: Oxford University Press 1987: Conger and Kanungo argue that Weber’s conceptualisation is “limited by lack of specificity”. They developed a behavioural framework within which charisma could be observed and measured. If the behaviours related to charisma can be isolated, then perhaps those behaviours can be developed to improve leadership or tested in applicants for leadership roles Conger & Kanungo’s 1987 article is available on the course website Charisma is a basket of qualities eg charm passion innovation etc X

Attributions of Charisma – 1: Concepts 159

Attributions of Charisma – 2: Follower contingencies Follower attributions of charisma depends on aspects of the situation Follower disposition Follower anxiety Follow disenchantment I’m building a wall I’m building a cathedral Two bricklayers one the one project were asked “what are you building?” Disposition = by nature 163

The locus of charismatic leadership Charismatic leaders … value and pursue an interrelated set of images: they are perceived as trustworthy, credible, morally worthy, innovative, esteemed, and powerful (Gardner & Avolio 1998) Followers must have a strong desire to identify with the leader Nine charismatic effects (House 1977); Jane A Halpert clustered these outcomes into: referent power, expert power & job involvement. People are sometimes caught in their own agenda. Referent power, expert power > charisma < job involvement Referent power = people refer to a charismatic leader. Expert power = expert in your area, you know your stuff. Job involvement = you see them contributing to your cause? Types of charismatic leaders Socialized charismatics restrain the use of power in the interest of others. Followers have clear values and independent and honest workers. Eg mother Teresa Personalized charismatics use power to serve their own interests, followers have an obedient, submissive style Office-holder charismatics attain their charisma chiefly from the position they hold Personal charismatics gain esteem from others faith in them as people, independent of office or position held. Divine charismatics were once define by strictly by the theology concept of possessing divine grace but- X

One view of the logic flow of charismatic leadership A: Charismatic leadership enhances staff motivation B: Motivated staff achieve superior outputs C: Superior outputs improve organisational effectiveness Where is the evidence? X RMIT University© School of Management

charismatic leadership Charismatic leadership qualities Vision Superb communications skills Self confidence and moral conviction High risk orientation Relational power base Ability to empower others Self-promoting personality Minimal internal conflict High energy and action orientation Ability to inspire trust Relational power base – in order to be charismatic they have to have relations with followers charismatic leadership X Howell and Aviolo (1992)

Am I a charismatic leader? There are four attributes that distinguish charismatic from non-charismatic leaders: Dissatisfaction with the status quo Compelling nature of the vision Use of unconventional strategies for achieving desired change A realistic assessment of resource needs and other constraints for achieving desired change X

I need some charisma, do you have any in stock? charisma is inborn and can not be “picked up” If you don’t have charisma you aren't “off the leadership track ……….. just in a slower, more challenging lane” some charisma qualities can be enhanced strategies for acquiring / enhancing charismatic qualities include: Developing visionary skills through practice and self-discipline Practicing being candid Developing a warm, positive, and humanistic attitude toward people rather than a negative, cool, and impersonal attitude Developing an enthusiastic, optimistic, and energetic personality X

Effects of Charismatic Leadership on staff motivation Followers trust in “rightness” of the leader’s vision Similarity of follower’s beliefs and values to those of the leader Heightened sense of self-confidence to contribute to accomplishment of the mission Acceptance of higher or challenging goals Identification with and emulation of leader Unconditional acceptance of leader Strong affection for the leader Emotional involvement of the follower in the mission Unquestioning loyalty and obedience to the leader House & Baetx (1979) Leadership: some empirical generalizations and new research directions in B.M. Staw (ed.) Research in Organizational Behavior vol 1 (Greenwich, CT: JAI Press, 1979), 399-401 X

Organizational Effects of Positive Charismatics Follower growth and development Environmental adaptation Achievement-oriented culture High-performing system Clearly understood mission Mission embodies social values Empowerment Open communication Shared information Structures and systems support mission 169

Charisma as a Double-Edged Sword Are all charismatic leaders necessarily good leaders? Personalised charismatics Socialised charismatics Adolf Hitler Charles Manson David Koresh Rev Jim Jones Gandhi Martin Luther King John Kennedy Winston Churchill Dominant, Machiavellian, narcissistic personality Pursue leader-driven goals, promote feelings of obedience, dependency, and submission in followers Use rewards and punishment to manipulate and control followers Use information to preserve the image of leader infallibility or to exaggerate external threats to the organization Egalitarian, self-transcendant, empowering personality Pursue organisation-driven goals, promote feeling of empowerment, personal growth, equal participation of followers Share information with followers and promote a positive organisational outlook 167

Cause and effect conundrum Agle, B Nagarajan, N Sonnenfeld, J, Srinivasan, D Does CEO Charisma Matter? Academy of Management Journal Feb 2006 Vol 49 Issue 1 p161-174 “Drawing on 770 surveys from top management team members in these companies, objective stock market and accounting data, and an objective measure of environmental uncertainty, we found that organizational performance was associated with subsequent perceptions of CEO charisma but that perceptions of CEO charisma were not associated with subsequent organizational performance even after we [controlled for] environmental uncertainty” X RMIT University© School of Management

What is Transactional leadership? Followers acknowledge the positional power of the leader Agreed values and motivations between leader and followers What is Transactional leadership? Punish undesirable follower behaviour Reward follower behaviours and performance X RMIT University© School of Management

Transactional leadership Burns (1978) / Bass (1996) Leaders and followers in an exchange relationship Very common; tends to be transitory Ethical element X

What is Transformational leadership? Followers trust, admire and respect the leader Moving and changing things in a big way by communicating to followers a special vision of the future, tapping into the followers’ higher ideals and motives What is Transformational leadership? There is collective “buy-in” to the organisational vision put forth by the leader and followers willingly expend exceptional effort Changing the status quo by articulating to followers the problems with the current system and providing a compelling vision of how things could be 170 RMIT University© School of Management

Transformational leadership Burns 1978 Power wielders v. leaders Serve to change the status quo by: Appealing to followers’ values Reframing issues Operating at a higher level of moral development than followers 171

Transformational vs. Transactional Leadership Burns, J. M Transformational vs. Transactional Leadership Burns, J. M. (1978) Leadership New York. Harper and Row Transformational leadership Appeals to moral values Serves to change the status quo by articulating to followers the problems in the current system and a compelling vision of what a new organization could be Transactional leadership Bureaucratic authority Task completion Seeks to maintain stability within an organisation through regular economic and social exchanges that achieve specific goals for both the leaders and their followers 171

Qualities for bringing about transformation Bass 1990 says transformational leaders are: Charismatic Practice inspirational leadership Provide intellectual stimulation Demonstrate concern for individuals 172

Role of leader in transformation Dubrin, Dalglish & Miller 2006 say that the transformational leader’s role is to: raise people’s awareness help people look beyond self-interest help people search for self-fulfilment help people understand need for change invest managers with a sense of urgency be committed to greatness adopt a long range, broad perspective X

Issues in transformational leadership Special relationship must be built Does not develop overnight Prevalent in countries possessing collectivist * societies (Jung et al 1995) Rosener 1990 - men described themselves in transactional terms; women described themselves in transformational terms * Is Singapore a collectivist society? X

Transformational Leader Behaviours and Attributes Bass & Avilio’s “Four I” dimensions Behaviour dimensions Idealised influence [role model, followers subscribe to ideals] Inspirational motivation [inspire followers with strong vision and motivation] Individual consideration [encourage followers with strong communication / attention] Intellectual stimulation [challenge followers to be creative / innovative] Adapted from Bass, B., & Avilio, B. (1994) Improving organizational effectiveness through transformational leadership Thousand Oaks, CA. Sage Publications X

So, does Transformational Leadership differ from Charismatic Leadership? Some researchers say there isn't really any difference. Others say that charisma is ONE of the attributes that characterise transformational leaders (the others being honesty, optimism, communication skills, confidence and consideration) But we do know that charisma is RELATIONAL in nature (ie it only works if the followers recognise the leader’s charisma) Leader traits and behaviours Follower values, needs, perceptions and beliefs 177 RMIT University© School of Management

Is it possible to be transformational but not charismatic? Can influence followers by meeting their emotional needs and providing intellectually stimulating rationale on the need for change. Bill Gates? Transformational and charismatic: Nelson Mandela? Transactional leadership: -agreed values and motivations with followers -reward follower behaviors and performance X RMIT University© School of Management

Acknowledgements VERSION: 1 Presentation developed by Ian Woodruff, School of Management, RMIT University RMIT is proud to partner with Pearson Australia in the development of the customised resources for this course. This presentation draws on material from chapter seven of the course textbook Sustainable Leadership people, technology and design – an RMIT Custom Publication, Pearson® Australia and is subject to copyright. Images included in this presentation are licenced under creative commons. Learn more about the creative commons scheme here. Graphics used in this presentation were created using Presenter Media Software licenced to Ian Woodruff, RMIT University. Presenter Media retains copyright for these graphics. VERSION: 1