1. Copyright ©2011 by Cengage Learning. All rights reserved 1 Chapter 14 Leadership Designed & Prepared by B-books, Ltd. MGMT3 Chuck Williams

2. Copyright ©2011 by Cengage Learning. All rights reserved 2 What Is Leadership? After reading these sections, you should be able to: 1.explain what leadership is. 2.describe who leaders are and what effective leaders do.

3. Copyright ©2011 by Cengage Learning. All rights reserved 3 Leadership Differences between Leaders and Managers Substitutes for Leadership 1 1

4. Copyright ©2011 by Cengage Learning. All rights reserved 4 Leaders versus Managers MANAGERS Do things right Status quo Short-term Means Builders Problem solving MANAGERS Do things right Status quo Short-term Means Builders Problem solving LEADERS Do the right thing Change Long-term Ends Architects Inspiring & motivating LEADERS Do the right thing Change Long-term Ends Architects Inspiring & motivating 1 1

5. Copyright ©2011 by Cengage Learning. All rights reserved 5 Leaders versus Managers American organizations (and probably those in much of the rest of the industrialized world) are underled and overmanaged. They do not pay enough attention to doing the right thing, while they pay too much attention to doing things right. - Warren Bennis American organizations (and probably those in much of the rest of the industrialized world) are underled and overmanaged. They do not pay enough attention to doing the right thing, while they pay too much attention to doing things right. - Warren Bennis 1 1

6. Copyright ©2011 by Cengage Learning. All rights reserved 6 Substitutes for Leadership Leadership substitutes –subordinate, task, or organizational characteristics that make leaders redundant or unnecessary Leadership neutralizers –subordinate, task, or organizational characteristics that interfere with a leader’s actions Leaders don ’ t always matter –Poor leadership is not the cause of every organizational crisis Beyond the Book

7. Copyright ©2011 by Cengage Learning. All rights reserved 7 Leadership Substitutes and Neutralizers Beyond the Book

8. Copyright ©2011 by Cengage Learning. All rights reserved 8 Who Leaders Are and What Leaders Do Leadership Traits Leadership Traits Leadership Behavior Leadership Behavior 2 2

9. Copyright ©2011 by Cengage Learning. All rights reserved 9 Biz Flix: Doomsday Take Two Video Click Beyond the Book 1.Assess the behavior of both Major Sinclair and Michael Canaris (David O’Hara). Which leadership traits does their behavior show? 2. Does this film sequence show any aspects of charismatic and transformational leadership? Draw some examples from the sequence.

10. Copyright ©2011 by Cengage Learning. All rights reserved 10 Leadership Behaviors Initiating Structure The degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. Consideration The extent to which a leader is friendly, approachable, and supportive and shows concern for employees. 2.2

11. Copyright ©2011 by Cengage Learning. All rights reserved 11 Beyond the Book Providing Security Jeffrey Katzenberg, CEO of DreamWorks, has realized that making employees feel secure has become increasingly important, especially in the last two years. If people don’t feel secure, they won’t be willing to take risks, which is crucial to success in the film business. Katzenberg works hard to communicate this to his employees—that their jobs are safe, that the company is growing (300 hires in the last year), and that they have a strong financial position. What kind of leadership behavior is Katzenberg demonstrating here? Source: J. Katzenberg, “Corner Office: The Benefit of a Boot Out the Door”, interview by A. Bryant, The New York Times, 7 November 2009. http://www.nytimes.com/2009/11/08/business/08corner.html?pagewanted=1 (accessed 11/10/2009).

12. Copyright ©2011 by Cengage Learning. All rights reserved 12 Blake/Moulton Leadership Grid1,9 Country Club Management 9,9 Team Management 1,1 Impoverished Management 9,1 Authority- Compliance 5,5 Middle of the Road 5,5 123456789 1 2 3 4 5 6 7 8 9 Concern for People Concern for Production High Low High 2.2

13. Copyright ©2011 by Cengage Learning. All rights reserved 13 Situational Approaches to Leadership After reading these sections, you should be able to: 3.explain Fiedler’s contingency theory. 4.describe how path-goal theory works. 5.explain the normative decision theory.

14. Copyright ©2011 by Cengage Learning. All rights reserved 14 Putting Leaders in the Right Situation: Fiedler’s Contingency Theory Group Performance = Leadership Style Situational Favorableness Situational Favorableness 3 3

15. Copyright ©2011 by Cengage Learning. All rights reserved 15 Putting Leaders in the Right Situation: Fiedler’s Contingency Theory Least Preferred Coworker Situational Favorableness Matching Leadership Styles to Situations 3 3

16. Copyright ©2011 by Cengage Learning. All rights reserved 16 Leadership Style: Least Preferred Coworker Leadership style is the way a leader generally behaves toward followers –seen as stable and difficult to change Style is measured by the Least Preferred Co-worker scale (LPC) –relationship-oriented –task-oriented 3.1

17. Copyright ©2011 by Cengage Learning. All rights reserved 17 Leadership Style: Least Preferred Coworker Scale 3.1 How would you rank your least-preferred coworker? He or she is:

18. Copyright ©2011 by Cengage Learning. All rights reserved 18 Situational Favorableness The degree to which a particular situation either permits or denies a leader the chance to influence the behavior of group members. Three factors:  Leader-member relations  Task structure  Position power 3.2

19. Copyright ©2011 by Cengage Learning. All rights reserved 19 Situational Favorableness 3.2

20. Copyright ©2011 by Cengage Learning. All rights reserved 20 Matching Leadership Styles to Situations 3.3

21. Copyright ©2011 by Cengage Learning. All rights reserved 21 Path-Goal Theory A leadership theory that states that leaders can increase subordinate satisfaction and performance by clarifying and clearing the paths to goals and by increasing the number and kinds of rewards available for goal attainment. 4 4

22. Copyright ©2011 by Cengage Learning. All rights reserved 22 How to Apply Path-Goal Theory Clarify paths to goals Clear paths to goals by solving problems and removing roadblocks Increase the number and kinds of rewards available for goal attainment Do things that satisfy followers today or will lead to future rewards or satisfaction Offer followers something unique and valuable beyond what they’re experiencing 4 4

23. Copyright ©2011 by Cengage Learning. All rights reserved 23 Path-Goal Theory Subordinate Contingencies Perceived Ability Locus of Control Experience Subordinate Contingencies Perceived Ability Locus of Control Experience Environmental Contingencies Task Structure Formal Authority System Primary Work Group Environmental Contingencies Task Structure Formal Authority System Primary Work Group Outcomes Subordinate satisfaction Subordinate performance Outcomes Subordinate satisfaction Subordinate performance Leadership Styles Directive Supportive Participative Achievement-Oriented Leadership Styles Directive Supportive Participative Achievement-Oriented 4 4

24. Copyright ©2011 by Cengage Learning. All rights reserved 24 Adapting Leader Behavior: Path-Goal Theory Leadership Styles Leadership Styles Subordinate and Environmental Contingencies Subordinate and Environmental Contingencies Outcomes 4 4

25. Copyright ©2011 by Cengage Learning. All rights reserved 25 Leadership Styles Directive –clarifying expectations and guidelines Supportive –being friendly and approachable Participative –allowing input on decisions Achievement-Oriented –setting challenging goals 4.1

26. Copyright ©2011 by Cengage Learning. All rights reserved 26 Subordinate and Environmental Contingencies Perceived ability Locus of control Experience Perceived ability Locus of control Experience SubordinateEnvironmental Task structure Formal authority system Primary work group 4.2

27. Copyright ©2011 by Cengage Learning. All rights reserved 27 Beyond the Book Control What You Can Wendy Kopp, founder and CEO of Teach for America which provides teachers for urban and rural public schools, has found that the most predictive trait of success in her teachers is an internal locus of control. As she says, there are many factors that could be blamed for student difficulties— kids, kids’ families, the education system— but the successful teachers will figure out what they can control within the given environment and own it and use it to their advantage. Source: W. Kopp, “Corner Office: Charisma? To Her It’s Overrated”, interview by A. Bryant, The New York Times, 4 July 2009. http://www.nytimes.com/2009/07/05/business/05corner.html (accessed 11/2/2009). http://www.nytimes.com/2009/07/05/business/05corner.html

28. Copyright ©2011 by Cengage Learning. All rights reserved 28 Path Goal Theory: When to Use Leadership Styles 4.2

29. Copyright ©2011 by Cengage Learning. All rights reserved 29 Adapting Leadership Behavior Worker Readiness Leadership Styles Leadership Styles Hersey and Blanchard’s Situational Leadership Theory Beyond the Book

30. Copyright ©2011 by Cengage Learning. All rights reserved 30 Worker Readiness The ability and willingness to take responsibility for directing one ’ s behavior at work Components of worker readiness: –Job readiness –Psychological readiness Beyond the Book

31. Copyright ©2011 by Cengage Learning. All rights reserved 31 Worker Readiness R4 R3 R2 R1 confident willing able confident willing able insecure not willing able insecure not willing able confident willing not able insecure not able not willing Beyond the Book

32. Copyright ©2011 by Cengage Learning. All rights reserved 32 Leadership Styles Telling (R1) Selling (R2) Participating (R3) Delegating (R4) high task behavior low relationship behavior high task behavior low relationship behavior high task behavior high relationship behavior high task behavior high relationship behavior low task behavior high relationship behavior low task behavior low relationship behavior Beyond the Book

33. Copyright ©2011 by Cengage Learning. All rights reserved 33 Normative Decision Theory Decision Styles Decision Quality and Acceptance 5 5

34. Copyright ©2011 by Cengage Learning. All rights reserved 34 Decision Styles Solve the problem yourself Solve the problem yourself Obtain information. Select a solution yourself. Obtain information. Select a solution yourself. Share problem, get ideas from individuals. Select a solution yourself. Share problem, get ideas from individuals. Select a solution yourself. AIAIICI Share problem with group, get ideas. Make decision, which may or may not reflect input. Share problem with group, get ideas. Make decision, which may or may not reflect input. Share problem with group. Together try to reach a solution. Leader acts as facilitator. Share problem with group. Together try to reach a solution. Leader acts as facilitator. CIIGII Leader solves the problem or makes the decision Leader accepts any decision supported by the entire group 5.1

35. Copyright ©2011 by Cengage Learning. All rights reserved 35 Decision Quality and Acceptance Using the right amount of employee participation: –improves decision quality –improves acceptance Decision tree helps leader identify optimal level of participation 5.2 © Jacob Hellbach/iStockphoto.com

36. Copyright ©2011 by Cengage Learning. All rights reserved 36  Quality Rule  If the quality of the decision is important, then don't use an autocratic decision style.  Leader Information Rule  If the quality of the decision is important, and if the leader doesn't have enough information to make the decision on his or her own, then don't use an autocratic decision style.  Subordinate Information Rule  If the quality of the decision is important, and if the subordinates don't have enough information to make the decision themselves, then don't use a group decision style. Normative Theory Decision Rules to Increase Decision Quality 5.2

37. Copyright ©2011 by Cengage Learning. All rights reserved 37 Normative Theory Decision Rules to Increase Decision Quality  Goal Congruence Rule  If the quality of the decision is important, and subordinates' goals are different from the organization's goals, then don't use a group decision style.  Problem Structure Rule  If the quality of the decision is important, the leader doesn't have enough information to make the decision on his or her own, and the problem is unstructured, then don't use an autocratic decision style. 5.2

38. Copyright ©2011 by Cengage Learning. All rights reserved 38 Normative Theory Decision Rules to Increase Decision Acceptance  Commitment Probability Rule  If having subordinates accept and commit to the decision is important, then don't use an autocratic decision style  Subordinate Conflict Rule  If having subordinates accept the decision is important and critical to successful implementation, and if subordinates are likely to disagree or end up in conflict over the decision, then don't use an autocratic or consultative decision style  Commitment Requirement Rule  If having subordinates accept the decision is absolutely required for successful implementation, and if subordinates share the organization's goals, then don't use an autocratic or consultative style 5.2

39. Copyright ©2011 by Cengage Learning. All rights reserved 39 Strategic Leadership After reading this section, you should be able to: 6.explain how visionary leadership (i.e., charismatic or transformational leadership) helps leaders achieve strategic leadership.

40. Copyright ©2011 by Cengage Learning. All rights reserved 40 Visionary Leadership Charismatic Leadership Transformational Leadership 6 6

41. Copyright ©2011 by Cengage Learning. All rights reserved 41 Charismatic Leadership Creates an exceptionally strong relationship between leader and follower Charismatic leaders: –articulate a clear vision based on values –model values consistent with vision –communicate high performance expectations –display confidence in followers’ abilities 6.1

42. Copyright ©2011 by Cengage Learning. All rights reserved 42 Beyond the Book Building a Cathedral Alan Mulally, CEO of Ford Motor Co., tells the following story: When three bricklayers are asked what they are doing, the first answers, “I’m making a living laying these bricks.” The second answers, “I’m learning about the profession of bricklaying so I can be the best bricklayer ever.” Finally, the third answers, “I’m helping to build a cathedral.” As a leader, Mulally believes, you need to help people understand the broader vision behind what they are doing. As people better understand the broader vision, they will be more motivated and unified in working towards it. Source: A. Mulally, “Corner Office: Planes, Cars and Cathedrals”, interview by A. Bryant, The New York Times, 5 September 2009. http://www.nytimes.com/2009/09/06/business/06corner.html (accessed 10/23/2009). http://www.nytimes.com/2009/09/06/business/06corner.html

43. Copyright ©2011 by Cengage Learning. All rights reserved 43 Kinds of Charismatic Leaders Ethical Charismatics –provide developmental opportunities –are open to positive and negative feedback –recognize others’ contributions –share information –show concern for the interests of the group Unethical Charismatics –control and manipulate followers –do what is best for themselves –only want positive feedback –motivated by self-interest 6.1

44. Copyright ©2011 by Cengage Learning. All rights reserved 44 Ethical and Unethical Charismatic Leaders Exercising Power Use power to serve others Creating the vision Allow followers to help develop the vision Communicating with followers Engage in two-way communication Accepting feedbackAre open to feedback Want followers to think and to question the status quo Stimulating followers Developing followersFocus on developing followers Living by moral standards Exhibit three virtues: courage, sense of fairness, integrity Charismatic Leader Behaviors Ethical Charismatics 6.1

45. Copyright ©2011 by Cengage Learning. All rights reserved 45 Ethical and Unethical Charismatic Leaders Charismatic Leader Behaviors Unethical Charismatics Exercising Power Use power to dominate others Creating the vision Sole provider of vision Communicating with followers Engage in one-way communication, not open to input from others Accepting feedbackHave an inflated ego, avoid candid feedback Don’t want followers to think, prefer uncritical acceptance of own ideas Stimulating followers Developing followersInsensitive to followers’ needs Living by moral standards Follow standards only if they satisfy immediate self interests 6.1

46. Copyright ©2011 by Cengage Learning. All rights reserved 46 Reducing Risks of Unethical Charismatics 1.Have a clearly written code of conduct 2.Recruit, select, and promote managers with high ethical standards 3.Train leaders how to value, seek, and used diverse points of view 4.Train leaders and subordinates regarding ethical leader behaviors 5.Reward those who exhibit ethical behaviors 6.1

47. Copyright ©2011 by Cengage Learning. All rights reserved 47 Transformational Leadership Generates awareness and acceptance of group’s purpose and mission Gets followers to accomplish more than they intended or thought possible 6.2

48. Copyright ©2011 by Cengage Learning. All rights reserved 48 Components of Transformational Leadership 1.Charisma or idealized influence 2.Inspirational motivation 3.Intellectual stimulation 4.Individualized consideration 6.2