Learning Outcomes Define leadership, power and authority Discuss leadership as it relates to management Explain leadership attitudes

Learning Outcomes 4. Describe the differences between a Theory X and Theory Y manager. 5. Explain the differences between transactional, transformational and charismatic leadership styles. 6. Identify strategies for effectively managing corporate culture.

Power, Authority and Leadership A measure of a person’s potential to get others to do what he or she wants them to do Also to avoid being forced by others to do what he or she does not want to do

Power, Authority and Leadership Sources of Power Organizational Ability to reward or punish Comes from position Personal Expert: skills, knowledge Referent: personal characteristics

Power, Authority and Leadership The right to issue directives and expend resources Related to power but is narrower in scope Function of position

Power, Authority and Leadership A person can have power without formal authority Authority decreases if coercive power and reward power decreases

Leadership The ability to influence people to willingly follow Informal leader: combine referent and expert power

Leadership vs. Management Not the same, but not entirely different Leadership means creating a vision of the future and enlisting support from employees Management is the process of planning, organizing, staffing, motivating and controlling through formal authority

Leader Attitudes Douglas McGregor Theory X Theory Y Authoritarian style of leadership Theory Y Democratic or laissez-faire style of leadership Self-fulfilling prophecy The idea that you get what you expect If manager’s expectations are high, they may get better results; if expectations are low, productivity is likely to be low

Classifying Leader Types Study leadership as traits or behaviors Trait theory Refers to the characteristics the leader possesses Research is not consistent Behaviors refer to what the leader does

Leadership Styles Autocratic Laissez-faire Democratic Makes most of the decisions for the group Laissez-faire Allows people within the group to make all of the decisions Democratic Guides and encourages the group to make decisions

Ohio State Studies Study to determine what a successful leader does Created the Leader Behavior Description Questionnaire Questionnaire created based on this question Shows that consideration (showing concern) and initiating structure (directing group toward goals) were the two most important behaviors Leaders who score high on consideration have happier employees Relationship between consideration and leader effectiveness depends on the type of group

University of Michigan Studies Tried to discover principles that contributed to productivity of group and member satisfaction The manager characteristics of a high producing group: General rather than close supervision Employees have some authority and responsibility Managers spend more time supervising Employee-oriented rather than production- oriented

More Leadership Studies: Renesis Likert Study Four styles of leadership Exploitative authoritative Benevolent authoritative Consultative Participative

Managerial Grid Developed by Robert Blake and Jane Mouton Ratings from a questionnaire are based on level of concern of employee and concern for production Identified the following styles: Authority-obedience Country club management Team management Impoverished management

Contingency Approach: Fred Fiedler The study of use of different styles in different situations Task- or relationship-oriented leader Considerations in knowing which style to use Leader member relations: degree that others trust and respect the leader Task structure: how structured is the job task Position power: influence associated with the job

Path-Goal Theory of Leadership Attempts to define the relationships between a leader’s behavior and the subordinates’ performance and work activities Leader’s behavior falls into types: Role classification leadership Supportive leadership Participative leadership Autocratic leadership Each leadership behavior results in different levels of performance and satisfaction

Situational Leadership Theory: Paul Henry & Kenneth Blanchard Maturity of followers should be a consideration in leadership style The amount of structure should be related to the amount of experience the employee has

Classifying Leader Types Transactional Leaders tell employees what to do, take corrective action if they don’t do it Transformational Cultivating employee acceptance of the group mission Encouragement Inspiration

Classifying Leader Types Charismatic Leaders and followers develop a relationship based on personality of leader Usually involves heroic feats on the part of the leader

Lessons from Leadership Studies The selection process can’t be developed to accurately predict successful leaders Complications: changing nature of managerial roles Most leadership training assumes 1 best way to lead In reality, leadership is situational Range of techniques are needed

Managing Corporate Culture Culture definition: The set of important understandings that members of a community share in common Corporate culture: The way things are done, often unspoken/written

Culture Components History Environment Staffing The way things have always been done Environment The mission and goals created and how imbedded they are into the way things are done Staffing The values and personalities of those who are hired influence culture How do people “fit”

Culture Components Entry socialization Strong and weak cultures A new employee is most likely to challenge the culture Refers to how well a new employee is accepting of the culture Strong and weak cultures A strong culture is clearly defined In a weak culture, individuals act in ways that are inconsistent with the company values

Corporate Culture Characteristics of corporate culture Individual autonomy Structure Support Identification Performance reward Conflict tolerance Risk tolerance

Types of Cultures Tough person, macho culture Individualists who take high risks and get quick feedback Not much cooperation Don’t learn from mistakes Competition

Types of Cultures Work hard, play hard culture Activity is key to success Rewards accrue to persistence and ability to find a need and fill it Value volume and people who are outgoing thrive

Types of Cultures Bet your company culture Requires big-stakes decisions Lots of time passes before results are known Pressure to make the right decision always present

Types of Cultures Process culture Subcultures Low risk with little feedback Employees focus on how things are done rather than outcomes Subcultures Exist in every organization Global companies have a variety of subcultures

Cultural Change Takes 6-15 years Change is needed if: Organization has strong values that do not fit in the changing environment Competitive industry Organization is mediocre If the company is joining the ranks of a very large company The organization is small but growing rapidly Time and money involved in changing culture