1. Leadership
1st Class

2. Learning Objectives
Define Leadership and how managers develop leadership qualities
Leadership approaches for contemporary organizations
Examine traits, behaviors
Contingency theories of leaders effectiveness
Charismatic and transformational leadership
Explore the role of followership
Servant leadership and moral leadership

3. Nature of Leadership
Perhaps no topic is more important to organizational success than leadership.
leadership occurs among people
involves the use of influence
is used to attain goals
Leadership is defined as the ability to influence people toward the attainment of goals.
Leadership is reciprocal, occurring among people.
Leadership is a “people” activity

4. Contemporary Leadership
Concept of Leadership evolves as the needs of organization change.
Significant influence on leadership style is the turbulence and uncertainty of the environment.
Postheroic approach – focuses on the subtle, unseen and often unrewarded acts that good leaders perform every day. Major characteristic is humility.
Two approaches that are in tune with postheroic leadership are:
Level 5 leadership – refers to the highest level in a hierarchy capabilities in transforming companies from merely good to truly great organizations. See Exhibit 1.0 next page.
Interactive Leadership - means that the leader favors a consensual and collaborative process, and influence derives from relationships rather than position power and formal authority. Values includes personal humility, inclusion, relationship building and caring.

5. Contemporary Leadership
Exhibit1.0 SOURE: Jim Collins Level 5 Hierarchy, Good to Great: Why some companies Make the Leap…and Others Don’t.

6. Management vs Leadership
Promotes stability, order and problem solving within organizational structures
Making sure suppliers are paid, customers invoiced, products and services are produced.
Needed to meet organizations commitment
Promotes vision, creativity, and change.
Questioning status qou so that outdated, unproductive norms will be change with new challenges.
Needed to move the organization to the future
Leadership cannot replace management; it should be in addition to management.

7. Manager and Leader Qualities
Manager Qualities
Leader Qualities
MIND
Rational
Consulting
Persistent
Problem solving
Tough-minded
Analytical
Structured
Deliberate
Authoritative
Stabilizing
Position power
SOUL
Visionary
Passionate
Creative
Flexible
Inspiring
Innovative
Courageous
Imaginative
Experimental
Initiates change
Personal power

8. Leadership Traits
Traits – distinguishing personal characteristic of a leader
Early research looked at leaders who had achieved greatness, hence referred to as Great Man Approach.
Exhibit 3.0 Summarize the physical, social and personal leadership characteristics
Exhibit 3.0 Personal Characteristic of Leaders
Physical Characteristics
Energy
Physical stamina
Intelligence and Ability
Judgment, decisiveness
Knowledge
Intelligence, cognitive ability
Personality
Self-confidence
Honesty & integrity
Enthusiasm
Desire to lead
Independence
Social Characteristics
Sociability, interpersonal skills
Cooperativeness
Ability to enlist cooperation
Tact, diplomacy
Work-related Characteristics
Achievement drive
Drive to excel
Conscientiousness in pursuit of goals
Persistence against obstacles, tenacity
Social Background
Education
Mobility
Illustration 3.0 Source: Adapted from Bernard M. Bass, Stogdill’s Handbook of Leadership, rev. Ed. (New York: Free Press, 1981), This adaptation appeared in R. Albanese and D. D. Van Fleet, Organizational Behavior: A managerial Viewpoint (Hinsdale, III.: The Dryden Press, 1983).

9. Behavioral Approaches
Two basic Leadership behavior based on OHIO Studies
Consideration: - people-oriented behavior
Is mindful of subordinates
Establishes mutual trust
Provides open communication
Develops teamwork
Oriented towards subordinates welfare
Initiating Structure: task-oriented behavior
Directs subordinate work activities toward goal attainment
Typically gives instructions, spends time planning, and emphasizes deadlines
Provides explicit schedules of work activities
Michigan studies comparing the behavior of effective and ineffective supervisors.
Employee Centered leaders - Effective supervisors focused on subordinates’ human needs to build effective work groups with high performance goals.
Job-centered leaders - less effective leader, favor more of meeting schedules, keeping cost low, and achieve production efficiency.

10. Leadership Grid
Blake and Mouton proposed two-dimensional theory called the managerial grid, and later named as leadership grid. Please refer to Exhibit 4: next page
Team Management (9,9) Most effective style and recommended for leaders who want to make member work together to accomplish task.
Country club Management (1,9) emphasis is given to people rather than work outputs
Authority-compliance management (9,1) occur when efficiency in operations is the dominant orientation
Middle-of-the-road management (5,5) reflects a moderate amount of concern for both people and production
Impoverish management (1,1) means absence of management philosophy

11. Leadership Grid
Exhibit 4: Source: The Leadership Grid Figure from Robert R. Blake and Anne Adams McCanse, Leadership Dilemmas-Grid Solutions (Houston: Gulf, 1991), 29. Copyright 1991, by Scientific Methods, Inc. Reproduced by permission of the owners.

12. Exhibit 5: Hersey and Blanchard Situational Theory
Contingency Approach
Contingency Approaches are theories builds on the leader- follower relationship of behavioral approaches to explore how the organizational situation influence leader effectiveness.
Hersey and Blanchard Situational Theory
Fiedler’s Contingency Theory
Substitute-for-leadership concept
Summarizes the leader style and follower readiness
The bell curve in Exhibit 5 is a called prescriptive curve because it indicates when each leader style should be used. The readiness level is indicated in the lower part of the exhibit.
Exhibit 5: Hersey and Blanchard Situational Theory

13. Contingency Approach
Exhibit 5 summarizes the relationship between leader style and follower readiness.
Different Styles:
Telling Style – high concern on task
Selling Style – high concern for both relationship and task
Participating Style – high concern for relationship
Delegating Style – low concern for both relationships and task

14. Contingency Approach Fiedler’s Contingency Theory
Basic idea is to match the leader's style with the situation most favorable for his or her effectiveness.
A situational approach to leadership postulating that effectiveness depends on the personal style of the leader and the degree to which the situation gives the leader power, control, and influence over the situation.
Task-oriented leaders are more effective when the situation is either favorable or high unfavorable. Relationship-oriented leaders are more effective in situations of moderate favorability.

15. Contingency Approach Substitute-for-leadership concept
This approach outlines those organizational setting in which leadership style is unimportant
Substitute = situational variable that makes a leadership style unnecessary or redundant
Neutralizer = situational variable that counteracts a leadership style and prevents the leader from displaying certain behaviors

16. Charismatic and Transformational Leadership
Charismatic Leader “a fire that ignites followers”
Ability to inspire and motivate people to do more than they would normally do
Tend to be less predictable because they create atmosphere of change
Strong vision of the future that excite, stimulate, and drive other people to word hard.
Transformational Leader
Similar to Charismatic leader
Ability to bring about innovation and change by recognizing follower’s needs and concerns,
Helping subordinates look at old problems in new ways
Encourages to question the status qou
Transactional Leader
Clarify the role and task requirements of subordinates, initiate structure and provide appropriate rewards
Considerate and meet the social needs of the subordinates
Excel in management functions by keeping things running smoothly such as plans, schedules and budgets.

17. Followers First dimensions of Followers Second dimensions of followers
Independent critical thinkers are mindful of the effects of their own and others behavior on achieving organizational goals.
Dependent uncritical thinkers does not consider possibilities beyond what he
or she is told, accepts supervisors idea without thinking.
Second dimensions of followers
Active followers participates fully in the organizational and engages in behavior that is beyond the limits of the job. Initiate ownership and problem solving - decision making.
Passive followers needs a constant supervision and avoid responsibility.
Different types of Followers
Alienated Follower – is a passive yet independent, critical thinker. Keeps on complaining about their boss without offering constructive feedback.
Conformist – participates actively in a relationship with the boss bud doesn’t use critical thinking skills. Carries all orders regardless of the nature of the request.
Pragmatic Survivor – has qualities of all four extremes- depending on which style fits with the prevalent situation. Uses whatever styles best benefits his or her own position and minimizes risk.
Passive followers – exhibits neither critical, independent thinking nor active participation. These people does not show initiative and sense of responsibility.
Effective Followers- exhibit critical and independent thinking and active in the organization. Capable of self-management.

18. Sources of Power
Power is the potential ability to influence the behaviors of others and is the capacity to cause a change in a person
Position Power
Legitimate power – power coming from a formal management position in an organization and the authority granted to it.
Reward power – stems from the authority to bestow rewards on other people.
Coercive Power – refers to the authority to punish or recommend punishments.
Personal Power
Expert Power – power resulting from person's special knowledge or skill regarding the task being performed.
Referent Power – comes from an individual’s personal characteristics that command others’ identification, respect and admiration so they wish to emulate that individual.
Other Sources of Power
Personal Effort – gain power by learning the organization and industry and work beyond what is expected.
Network of relationship – power gained through the network of relationship and connections in an organization and industry,
Information – power to have access to information and control over how and to whom it is distributed.

19. Influence Interpersonal Influence Tactics
The effect a person’s actions have on the attitudes, values, beliefs or behaviors of others
Interpersonal Influence Tactics
Use rational persuasion – based on facts
Make people like You – power of praise
Rely on the rule of reciprocity – Golden Rule
Be assertive – ask for what you want
Make use of higher authority
Reward the behaviors you want

20. Leadership as Service Servant Leadership Moral Leadership
transcend self-interest to serve others and the organization.
Operate to fulfill subordinates goals and needs and for the realization of the larger purpose of the organization.
Encourages participation, share power, enhance others self-worth and unleash creativity.
They often work in the nonprofit world.
Moral Leadership
Seeking the just, honest, and decent behavior in the practice of leadership.
Remembers the business is about values, not just economic performance.
Requires courage, to step forward through fear and act on ones values an conscience.

21. MOUNTAIN WEST HEALTH PLANS, INC.
Case Study

22. Mountain West Health Plans, Inc
Mountain West Health Plans, Inc. is a Denver-based health insurance company. One of the departments of Mountain West is the customer service, doing the fielding call after call of its products, benefits, eligibility and claims which was previously handled by the leadership of Evelyn Gustafson. She was admired by her subordinates because of the way she managed the department.
After Evelyn retired, the new director, Erik Rasmussen, implemented new rules of cost-cutting to the Customer Service department. The department cost finally heading downward but the morale was increasing downwards too. Martin Quinn, senior VP for service and operations needs to evaluate Erik performance to address the complaints coming from his subordinates and subscribers.

23. How would you describe Evelyn Gustafson’s leadership style
How would you describe Evelyn Gustafson’s leadership style? What were its strengths and weaknesses? What were the sources of her influence?
Evelyn Gustafson had a leadership style very different than Erik Raumussen. Evelyn is a people-oriented leader. Is mindful of subordinates, she is oriented towards subordinates welfare and she was able to establish a mutual trust.
For the Leadership grid, Evelyn Gustafson will be considered as Country Club Management. She has low concern for the production but high concern of the people. She has a thoughtful attention to the needs of her subordinates for a comfortable, friendly organization atmosphere. This is prevalent when she resisted all attempts to increase efficiency and lower costs in the department.
She is a charismatic leader who had the ability to inspire her subordinates by her motto “Always put yourself in the subscriber’s shoes”. She motivates them that their job was important.

24. Her style is positive because her concern for her employees creates a positive and pleasant work environment demonstrating a 10 percent turnover rate only, compared to the 25 to 25 rate for customer service representative. She also uses an interactive leadership because of relationship building and caring. For a situational theory, Evelyn is using a participating style, because of high concern for people and relationship but low concern for production task. As a leader she shares ides with subordinates and facilities decision making. This was done through the training opportunities conducted to keep her subordinates up- to-date with the latest problem –solving customer service techniques.

25. Strengths
She has the charisma that motivate and inspire people
She worded her way up from being a customer service rep to a director position
Staff were sent off to training, part of making them feel good about themselves, to be more productive learning new customer service techniques
High morale of staff
low turn over rate of 10% compared to typical 25~45%
Weaknesses
Less focus on work outputs that resulted to high cost of labor
Long handling time with customer
Salary was covering 70% of the budget
Frequent breaks of her subordinates

26. Sources of influence
Derived from relationships rather than position, power and formal authority
Used the value of relationship building and caring and has the behavior of being a people-oriented person
Used personal power (referent) in influencing the behavior of her staff, her staff emulates her. Employees admire her because of the way she deals with them.
From the interpersonal tactics, Evelyn uses Make people like you, she strive to create a goodwill and favorable impression to her subordinates.

27. How would you describe Erik Rasmussen’s leadership style as he tried to effect change? What are its strengths and weaknesses? What are the sources of his influence?
The leadership style of Erik Rausmussen is task-oriented. Directs subordinate work activities toward goal attainment, and he spent time planning to improve the schedules and efficiency of the team though his automation software’s and standards. Provides explicit schedules of work activities.
He is a job-centered leader; he favored more of meeting schedules, keeping cost low, and achieves production efficiency instead of building relationship. He implemented an increased of the number of calls per hour each representative handles a priority.

28. From the Leadership grid, he demonstrated an authority- compliance, because he has a high concern for production, and a low concern for people. Efficiency in operations, for the first time, he set statistical standards to emphasize speed.
From situational theory, he is telling style of leader, which he closely supervise performance of his subordinates and provides specific instructions, through recording of the service calls and automated scheduling of schedules based on historical and projected needs.

29. Strength
Produces quality work and his subordinates are efficient.
Promoted change in the organization
Cut down on cost of labor and training
Improved efficiency in scheduling
Implemented new software’s and automation to improve efficiency
Weaknesses
Low morale of people, there was “leadership overkill”
High turn over rate of 30%
Complains from subscribers on the inexperience staff and rushed calls

30. Sources of influence
He uses a Make use of higher authority influence tactics. By using his formal authority, he get things done, as well, as gain the support of the people at a higher level.
being his first managerial position, he was more of playing the role of a manager rather than that of a leader.
idealistic as he is, who just graduated, he was promoting problem solving and helping organization meet commitments. He uses an expert power that he gained from his business administration degree.

31. If you were Martin Quinn, would you recommend modifications in Erik Rasmussen’s leadership style that you would like him to adopt? Do you think it will be possible for Rasmussen to make the necessary changes? If not, why not? If you do think change is possible, how would you recommend the desired changes be facilitated?
Martin Quinn, the VP of service and operations, already experienced how the leadership of Evelyn Gustafson boosts the morale of the employees. She knows what is lacking in the skills of Erick. Quinn can recommend to Erik to have balance on both leadership and management skills. Having a good background in business administration, Erick can improve his side of leadership styles.
A Team management style would be best suited for Erick. He has already the skills in initiating change for efficiency of task, Quinn can recommend for Erik to work towards a team management style from a Leadership Grid by working together with his members to accomplish task.

32. Erick can also bring a transformational or charismatic way leadership style. Not only he implements innovative ways of improving task, but he is also recognizing the needs and concerns of his subordinates. Helping subordinates and working together look at old problems in new ways.
Quinn, as a leader himself should give a balanced feedback. Importantly, he should praise Erik for doing a job well done in lowering down cost which was the primary concern of him being hired to the position. Leadership evolves as the need of the organization change. Therefore, I will recommend some modifications on Erik’s leadership style.

33. Steps
Acknowledge facts and figures on how well the company has performed while Erik assumed the position. Use rational persuasion.
Give customer feedback, in terms of inexperienced staff, rushed calls, etc.
Give feedback as to how the staff are accepting the current change, effect on low morale and high turn over rate
Encourage Erik to balance the skills of people and task-oriented, by focusing on people skills, he can develop a charismatic or transformational kind of leader leading the team to be inspired and motivated.
Develop interpersonal skills and selling skills from the situational theory.
Tell him what you want him to do – develop high concern for both people and for the task

34. JOHN JOEY NELIA NIELSON CHARLES
Case Study