Chapter 8 Leadership

1. Chapter 8Leadership Michael A. Hitt C. Chet Miller Adrienne Colella Slides by Ralph R. Braithwaite

2. Cathy Benko at Deloitte Consulting Cathy Benko Exploring Behavior in Action • What are your reactions to Cathy Benko’s story? • What are your thoughts about her quote at the end of the section? “Life is not fair. Not everybody starts at the same place or has the same opportunities and support someone else might have. Don’t spend time wondering why you’re in the position you’re in. Just get out there and do as well as you can …”

3. The Strategic Importance of Leadership • Is there a link between leadership and organizational performance? • Do organizations do enough to develop leadership skills? • Strategic leadership involves developing a vision, empowering associates, building relationships, and building and maintaining a high-involvement, high-performance workforce.

4. Knowledge Objectives • Define leadership and distinguish between formal and informal leaders. • Explain the trait concept of leadership. • Describe major behavioral theories of leadership and compare and contrast them. • Explain contingency theories of leadership and how they relate leadership effectiveness to situational factors. • Describe transformational leaders. • Discuss topics of current relevance, including leader-member exchange, servant leadership, gender effects on leadership, and global differences in leadership.

5. The Nature of Leadership The process of providing general direction and influencing individuals or groups to achieve goals.

6. Warren Bennis Effective Leaders Effective leaders are concerned with “doing the right things” rather than “doing things right.” The right things are: • Creating and communicating a vision of what the organization should be • Communicating with and gaining support of multiple constituencies • Persisting in the desired direction • Creating the appropriate culture and obtaining the desired results

7. Trait Theory of Leadership Concept that certain traits help make people effective leaders. Early research suggested that the traits fell into three categories: PhysicalCharacteristics Some Criticism PersonalityCharacteristics Abilities

8. Traits Associated with Leadership Energy Insightfulness Appearance Integrity Intelligence Persistence Judgment Self-confidence Verbal fluency Sense of humor Achievement drive Tolerance for stress Adaptability Interpersonal skills Aggressiveness Prestige Enthusiasm Extroversion Tact Initiative Adapted from Exhibit 8-1: Common Traits Associated with Leadership

9. Six Core Traits of Leadership Drive LeadershipMotivation Integrity Self-Confidence CognitiveAbility Knowledgeof theDomain

10. Reforming a “Rotten Apple” What are your thoughts regarding the leadership traits of Police Commissioner William Bratton? What are your thoughts regarding the changes he made that earned him the “Police Executive of the 20th Century” award and his face on the cover of Time?

11. Charisma Charismatic leaders inspiretheir followers to change their needs andvalues, follow visionary quests, and sacrifice theirown personal interestsfor the good ofthe cause. Winston Churchill Eleanor Roosevelt John F. Kennedy Adolf Hitler Martin Luther King, Jr. Barbara Jordan Ronald Reagan

12. Behavioral Theories of Leadership University of Michigan Studies Ohio StateUniversity Studies

13. Rensis Likert Daniel Katz Robert Kahn University of Michigan Studies • Job-Centered Leadership Style • Employee tasks • Methods for accomplishment • Employee-Centered Leadership Style • Employees’ personal needs • Development of interpersonal relationships

14. Ralph Stogdill Edwin Fleishman Ohio State University Studies • Consideration • Leaders express friendship • Develop mutual trust and respect • Strong interpersonal relationships with staff • Initiating Structure • Well defined patterns of organization and communication • Define procedures • Delineate relationships with staff • Emphasize goals and deadlines • Assign tasks and identify performanceexpectations

15. High D A (Employee-Centered Style) Consideration B C (Job-Centered Style) Low High Initiating Structure Behavioral Theories of Leadership Adapted from Exhibit 8-2: Comparison of Consideration and Initiating Structure with Employee-Centered and Job-Centered Concepts

16. Contingency Theories of Leadership Fiedler’s Theory Path-Goal Theory

17. Fred Fiedler Fiedler’s Contingency Theory of Leadership • Effectiveness depends on leader’sbehavioral style and the situation • Leader style measured by the LPC (least preferred co-worker) scale • Situational favorableness assessed by three things: Leader-memberrelations Task structure Position power

18. ___:___:___:___:___:___:___:___ Cooperative Uncooperative 8 7 6 5 4 3 2 1 ___:___:___:___:___:___:___:___ Friendly Unfriendly 8 7 6 5 4 3 2 1 Fiedler’s LPC Scale • Esteem for Least Preferred Co-Worker • Low LPC Score • Negative adjectives • Task-oriented leader (task achievement needs first) • High LPC Score • More positive adjectives • Relationship-oriented leader (interpersonal relationship needs first)

19. Situational Characteristics • Leader-Member Relations • The degree to which a leader is respected, accepted, and had friendly interpersonal relationships with followers • Task Structure • The degree to which tasks are broken down into easily understood steps or parts • Position Power • The degree to which a leader can reward, punish, promote, or demote individuals in the unit or organization

20. Fiedler’s Contingency Theory of Leadership Effectiveness Adapted from Exhibit 8-3: Fiedler’s Contingency Model of Leadership Effectiveness

21. Robert House Martin Evans Path-Goal Leadership Theory LeadershipStyle ContingencyFactors Outcomes

22. Leader Effectiveness Leadership can effect employees’ expectancies and valences in several ways: • Assign tasks that have high value (valence) • Support employees’ efforts (effort → performance expectancy) • Tie rewards to goal accomplishment (performance→reward instrumentality)

23. Effectiveness of leader behavior depends on these situational factors Path-Goal Leadership Theory Leader Behaviors Situational Factors • Directive Leadership • Supportive Leadership • Achievement-Oriented Leadership • Participative Leadership • Subordinate Characteristics • Work Environment Characteristics

24. Interaction of Leader Behavior and Situational Factors Locus ofControl Need forAffiliation Need forSecurity Participative, Directiveor Supportive Leaders Need forGrowth

25. Situational Factors Effective Leader Behaviors Subordinate Characteristics Characteristics of the Work Environment Internal locus of control External locus of control High need for affiliation High need for security Participative Directive Supportive Directive Structured task Unstructured task Supportive Directive Strengths High growth need Complex task Participative/ Achievement oriented Low growth need Complex task Directive High growth need Simple task Supportive Low growth need Simple task Supportive Interaction of Leader Behavior and Situational Factors Adapted from Exhibit 8-4: Interaction of Leader Behavior and Situational Factors

26. Phil Jackson and Leadership Success ManagerialAdvice Phil Jackson In terms of leadership, this means treating everyone with the same care and respect you give yourself – and trying to understand their reality without judgment. When we can do that, we begin to see that we all share human struggles, desires, and dreams. • What are your thoughts about this quote? • Have you ever worked for a leader who approached the job like this? • Does the leadership style one uses need to change based on each situation? Why? • When would a leader want to be “invisible”?

27. Transactional Leadership A leadership approach that is based on the exchange relationship between followers and leaders. It is characterized by contingent behavior and active management-by-exception behavior. It is the degree to which leaders provide what followers want in response to good performance.

28. Four Characteristics of Transactional Leaders • Understand what followers want to receive from their work, and attempt to give them what they desire, contingent on performance • Clarify links between performance and reward • Exchange rewards and promises of rewards for specified performance levels • Respond to the interests of followers only if the followers are performing satisfactorily

29. Transactional Leadership Contingent Reward Behavior • Clarify performance expectations • Reward followers when expectations are met Active Management-by-Exception Behavior • Clarifies minimal performance standards • Punishes when standards are not met Consistently MonitorsPerformance

30. Transformational Leadership A leadership approach that involves motivating followers to do more than expected, to continuously develop and grow, to increase self-confidence, and to place the interests of the unit or organization before their own. Involves charisma, intellectual stimulation, and individual consideration.

31. Increase followers awareness of the importance of pursuing a vision or mission and the strategy required Encourage followers to place the interests of the unit, organization, or larger collective before their own personal interests Raise followers’ aspirations so they continuously try to develop and improve themselves while striving for higher levels of accomplishment Transformational Leaders Do Three Things

32. IntellectualStimulation IndividualConsideration Charisma Characteristics

33. Charisma Charismatic Leaders • Inspire emotion and passion in followers • Get followers to identify with the leader • Display confidence • Communicate and live up to organizational values • Optimistic and enthusiastic

34. IntellectualStimulation Intellectual Stimulation • Increase the followers’ focus on problems and develop new ways to solve them • Reexamine assumptions • Seek out different views • Work to be innovative

35. IndividualConsideration Individual Consideration • Support and develop followers to improve self-confidence and a desire to improve performance • Provide individualized attention to followers • Focus on followers’ strengths • Act as teachers and coaches

36. Common Behaviors • Articulate clear, appealing vision • Communicate the vision • Delegate significant authority and responsibility • Eliminate unnecessary bureaucratic restraints • Provide coaching, training and developmental experiences • Encourage open sharing of ideas and concerns • Encourage participative decision making • Promote cooperation and teamwork • Modify structure to promote key values and objectives

37. Laissez-Faire Leadership • Opposite approach to transformational leadership • Not proactive • React only to failures or chronic problems • Avoid making decisions • Often absent or uninvolved in followers’ activities • Typically do not have positive outcomes

38. D. Michael Abrashoff USS Benfold Commander Abrashoff • Demonstrated confidence • Focused on the vision • Linked tasks to the vision • Went beyond self-interest • Created intellectual stimulation • Displayed individual consideration • Would you want to work for someone like Abrashoff? Why or why not? • Would his approach work in most work environments? Why or why not?

39. Some Conclusions • Leaders can be trained to exhibit transformational leadership behaviors • Leaders can display both transformational and transactional leadership styles • Both transformational and transactional leadership can be positive

40. The Effects TransformationalLeadership Charisma Intellectual Stimulation Individual Consideration Outcomes Individual Outcomes Unit/Organization Outcomes Transactional Leadership Contingent Reward Behavior Active Management by Exception Dynamism of the task/organizationalenvironment Adapted from Exhibit 8-5: The Effects of Transformational and Transactional Leadership

41. Ethical Leadership? Authentic Leadership! Dennis Kozlowski Thoughts? ExperiencingStrategic OB

42. Ethical Leadership? Authentic Leadership! Thoughts? Ken Lay Jeff Skilling Andrew Fastow ExperiencingStrategic OB

43. Ethical Leadership? Authentic Leadership! Thoughts? Thoughts? Ryan Brant Samuel Waksal Martha Stewart ExperiencingStrategic OB

44. Authentic Leaders Thoughts? • Guided by values that focus on doingwhat’s right for their constituencies • Try to act in accordance with their values • Remain transparent • “Walk the talk” • Place equal weight on getting the task accomplished and developing associates • Continuously develop themselves • Have developed values and personal strengths they need to deal with ambiguous ethical issues ExperiencingStrategic OB

45. Leader-Member Exchange (LMX) • Different relationships with different followers – not all are treated the same • High level of contribution is a factor • Similarity to the leader is a factor • Two groups - an In-group and an Out-group • Mutual trust and support • Levels of satisfaction

46. In Group Leader Exchange Follower Out Group Leader-Member Exchange (LMX)

47. Max De Pree Former CEO of Herman Miller Servant Leadership • Valuing individuals • Developing people • Building community • Conceptualizing • Exhibiting foresight • Displaying wisdom • Desire to serve others

48. Structural-cultural model of leader behavior Socialization model Both women and men may be effective leaders when style matches the situation Gender Effects on Leadership Do women lead differently than men?

49. Global Differences • Anglo cluster (ideal leader) • Charismatic influence and inspiration, encouraging participation • Diplomatic, delegating authority, allowing everyone to have their say • Arabic cluster (ideal leader) • Need to balance paradoxical set of expectations • Expected not to differentiate themselves from others and have modest styles and • Expected to have great deal of power and control, and to direct most decisions and actions

50. Global Differences • Germanic cluster (ideal leader) • Charismatic • Highly team-oriented • Participative • Southern Asia cluster (ideal leader) • Humane, participative, and charismatic • Expected to be benevolent while maintaining a strong position of authority