9 chapter Business Essentials, 8 th Edition Ebert/Griffin Leadership and Decision Making PowerPoint Presentation prepared by Carol Vollmer Pope Alverno College Instructor Lecture PowerPoints Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

After reading this chapter, you should be able to: 1.Define leadership and distinguish it from management. 2.Summarize early approaches to the study of leadership. 3.Discuss the concept of situational approaches to leadership. 4.Describe transformational and charismatic perspectives on leadership. L E A R N I N G O B J E C T I V E S 9-2 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

After reading this chapter, you should be able to: 5.Identify and discuss leadership substitutes and neutralizers. 1.Discuss leaders as coaches and examine gender and cross-cultural issues in leadership. 2.Describe strategic leadership, ethical leadership, and virtual leadership. 3.Relate leadership to decision making and discuss both rational and behavioral perspectives on decision making L E A R N I N G O B J E C T I V E S (cont.) 9-3 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

What’s in It for Me? Why does understanding leadership matter to you? By mastering the material in this chapter, you’ll benefit in two ways: 1.You’ll better understand how you can more effectively function as a leader 2.You’ll have more insight into how your manager or boss strives to motivate you through his or her own leadership 9-4 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

The Nature of Leadership What Is Leadership? Processes and behaviors used by someone, such as a manager, to motivate, inspire, and influence the behaviors of others. Are Leadership and Management the Same? No. A person can be a manager, a leader, both, or neither. 9-5 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Source: The Free Press, an imprint of Simon & Schuster Adult Publishing Group, from A Force for Change: How Leadership Differs from Management, by John P. Kotter, Copyright 1990 by John P. Kotter, Inc. TABLE 9.1 Kotter’s Distinctions Between Management and Leadership 9-6 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Early Approaches to Leadership Trait Approach Focused on identifying essential leadership traits Intelligence, dominance, self-confidence, energy, activity (versus passivity), and knowledge about the job Physical traits (height, body shape, handwriting) Yielded inconsistent results Recent research has focused on a limited set of traits Emotional intelligence, mental intelligence, drive, motivation, honesty and integrity, self-confidence, knowledge of the business, and charisma 9-7 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Early Approaches to Leadership (cont.) Behavioral Approaches to Leadership Focused on the behaviors of effective versus ineffective leaders Assumed behaviors of effective leaders would be the same across all situations Task-focused leader behaviors related to increasing the performance of employees Employee-focused leader behaviors related to job satisfaction, motivation, and well-being of employees 9-8 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

The Situational Approach to Leadership Situational Approach Assumes that appropriate leader behavior varies from one situation to another Continuum of leadership behavior Considers characteristics of the leader, subordinates, and the situation 9-9 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Source: Harvard Business Review. An exhibit from “How to Choose a Leadership Pattern” by Robert Tannenbaum and Warren Schmidt (May-June 1973). Copyright 1973 by the President and Fellows of Harvard College; all rights reserved. FIGURE 9.1 The Leadership Continuum 9-10 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Leadership Through the Eyes of Followers Transformational Leadership Set of abilities that allows a leader to recognize the need for change, to create a vision to guide change, and to execute the change Transactional Leadership Basic management involving routine, regimented activities (leading during a period of stability) 9-11 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Leadership Through the Eyes of Followers (cont.) Charisma A form of interpersonal attraction that inspires support and acceptance Charismatic Leadership Influence based on the leader’s personal charisma 9-12 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Special Issues in Leadership Leadership Substitutes Individual, task, and organizational characteristics that tend to outweigh the need for a leader Leadership Neutralizers Factors that cause leadership behaviors to be ineffective Cohesive groups Elements of the job Organizational factors 9-13 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

TABLE 9.2 Leadership Substitutes and Neutralizers 9-14 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

The Changing Nature of Leadership Leader as Coach From directive overseer to mentor Gender Understanding the differences and dynamics in the approaches of women and men to leadership Cross-Cultural Leadership Effects of an individual’s native culture on his or her approach to leadership when functioning in another culture 9-15 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Emerging Issues in Leadership Strategic Leadership Leader’s ability to understand the complexities of the organization and its environment and lead change to enhance organizational competitiveness Ethical Leadership Leader’s ability to maintain high ethical standards for personal conduct, unfailingly exhibit ethical behavior, and hold others to the same standards Virtual Leadership Leading through effective communication and maintaining collaborative relationships at a distance 9-16 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Leadership, Management, and Decision Making Rational decision making Recognizing and defining the decision situation Identifying alternatives Evaluating alternatives Selecting the best alternative Implementing the chosen alternative Following up and evaluating the results 9-17 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

FIGURE 9.2 Steps in the Rational Decision- Making Process 9-18 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Behavioral Aspects of Decision Making Political Forces in Decision Making Coalition: An informal alliance of individuals or groups formed to achieve a common goal Intuition An innate belief about something, often without conscious consideration Escalation of Commitment Staying with a chosen course of action, even when it appears to have been wrong Risk Propensity The extent to which a decision maker is willing to gamble when making a decision 9-19 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

Key Terms behavioral approach to leadership charismatic leadership coalition decision making employee-focused leader behavior escalation of commitment ethical leadership intuition leadership leadership neutralizers leadership substitutes risk propensity situational approach to leadership strategic leadership task-focused leader behavior trait approach to leadership transactional leadership transformational leadership virtual leadership 9-20 Copyright © 2011 Pearson Education, Inc. publishing as Prentice Hall

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