CONTINGENCY THEORIES Presented by: Lillie Ramage 07/22/03

Leadership Styles Leadership is the ability to influence others toward the achievement of goals.  Ability to influence others  Dealing with others  Use a variety of interpersonal skills

 Why did Martin Luther King have charisma in the eyes of his followers?

CONTINEGENCY THEORY Definition: “Basically, it’s the approach that ‘it depends.’ The continuing effort to identify the best leadership or management style might now conclude that the best style depends on the situation. If one is leading troops in the Persian Gulf, an autocratic style is probably best (of course,many might argue here, too). If one is leading a hospital or university, a more participative and facilitative leadership style is probably best.

Contingency Theories of Leadership Fiedler Contingency Model Hersey & Blanchard’s Situational Theory Leader-Member Exchange Theory Path-Goal Model Leader-Participation Models

Fiedler Contingency Model Effective group performance depends on both the leader’s personality and the situation. Certain leaders are effective in one situation but not in others. LPC Scale (least preferred co-worker questionnaire measures whether a leader is task motivated or relationship motivated)

Fiedler Contingency Model Three factors determine the favorableness of the situation: Leader-Member Relations - Degree of mutual trust and respect between the leader and subordinates Task Structure -Degree to which the task at hand is low in municipality and high in verifiability, specificity and clarity Leader Position Power - The power inherent in the leader’s position itself.

Fiedler’s Contingency Model Leader Member Relations Good Good Good Good Poor Poor Poor Poor Task Structure High High Low Low High High Low Low Position power Strong Weak Strong Weak Strong Weak Strong Weak Poor Good Performance Relationship motivated Task motivated Category I II III IV V VI VII VIII FavorableModerateUnfavorable

Hersey and Blanchard’s Situational Theory (SLT) A contingency theory that focuses on follower’s readiness Based on an interplay among: Amount of guidance and direction (task behavior) a leader gives Amount of guidance and socioemotional support (relationship behavior) a leader provides The readiness level that followers exhibit in performing a specific task, function or objective

Hersey-Blanchard's

Graen’s Leader-Member Exchange (LMX) Theory Leaders create in-groups & out-groups. Subordinates with in-group status will have > performance ratings, satisfaction with their supervisor. How are in-group members chosen?

LMX Theory Leaders establish one-on-one relationships with each follower Relationships vary in quality

LMX Theory In-Group – high-quality relationship  Mutual trust, liking, and respect  Members given interesting and challenging assignments  Members work hard, are loyal, and support the leader

LMX Theory Out Group – low-quality relationship  Leaders consider them as lacking motivation or loyalty  Given fewer chances to show their capabilities  Members may “live down” to expectations  Carry out tasks defined in their job descriptions  No loyalty, creativity or high performance

LMX Practical Implications In-groups and out-groups lead to self-fulfilling prophecies Having in-groups and out-groups may not be avoided. Base group status on ability and motivation, not favoritism or prejudice Ensure that members can move between groups

House's Path-Goal Theory It’s the leader’s job to assist followers in attaining their goals and to provide the necessary direction and/or support to ensure that their goals are compatible with the overall objectives of the group or organization

House’s Path-Goal Theory

House's Path-Goal Theory Leader-Situation Match Directive Behavior - Use when the task is unstructured and employees need direction. Supportive Behavior - Use when employees lack self-confidence or work motivation.

House's Path-Goal Theory Leader-Situation Match Participative Behavior - Use when employees know better or when they desire involvement in decision making. Achievement-Oriented Behavior - Use when goals are not clear or employees are not committed to realizing desired outcomes.

Leader-Participation Model Victor Vroom and associates - relate leadership behavior and participation to decision making Provides a sequential set of rules to follow in determining the form and amount of participation in decision making rule selection determined by the situation Provides an excellent guide to help managers choose an appropriate leadership style to fit the situation

Leader Participation Model Decide - leader makes decision alone, either announcing or selling to group Consult Individually - leader makes decision after obtaining feedback from group members individually Consult Group - leader makes decision after obtaining feedback from group members in meeting Facilitate - leader, acting as facilitator, defines problem and boundaries for decision-making after presenting it to group Delegate - leader permits group to make decision within prescribed limits

Things to Remember Identify the needs of the leadership situation based on your goals and strategies, the motivation and skill of your employees, and the complexity of the task. Timing is critical. You only have a certain “window of opportunity” to establish the credibility of your leadership within an organization. There is no single leadership style that is universally effective – effective leadership depends on the situation

“Jack Welch: Case Incident p. 330 Would you describe Jack Welch as a successful leader at GE? What theories do you think he uses?