1. © The McGraw-Hill Companies, 2005 Management & Organisational Behaviour 2e Chapter 14 Leadership

2. © The McGraw-Hill Companies, 2005 1 Learning Outcomes After studying this chapter, students will be able to: Distinguish between the art of leadership and the practice of management. Understand the role of personality traits in leadership. Contrast group-centred leadership theories based on cognitive styles and observable behaviours. Apply emotional intelligence when choosing appropriate leader styles.

3. © The McGraw-Hill Companies, 2005 2 Learning Outcomes (cont.) Explain why most current theories of leadership are based on situational contingencies. Diagnose when transformational and transactional leadership are appropriate. Show why leadership is not necessary for all organisational circumstances.

4. © The McGraw-Hill Companies, 2005 3 Leadership is both a process and a set of characteristic behaviours Process – use of non-coercive influence to direct and energize others to behaviourally commit to the leader’s goals. Characteristic Behaviours – the creation of vision and goals and the motivating of others to obtain voluntary commitment.

5. © The McGraw-Hill Companies, 2005 4 Managers versus Leaders Managers have authority to be in charge. Leaders influence others to follow. Managers do things right. Leaders do the right things. Managing means to bring about, to accomplish, to have responsibility for, to conduct. Leading is influencing, guiding in direction, course, action, opinion.

6. 5 Exhibit 14-1: Kotter’s Distinction Between Managers and Leaders Planning and budgeting (deductively producing orderly results) Motivating people (creating Involvement, emphasising values, building informal networks of relationships) Controlling and problem solving (comparing behavior with plan, taking action to correct deviations) Aligning people to the vision (emphasising communication, credibility, and Empowerment) Setting a direction (inductively creating a vision and strategies to provide focus for planning) Organising and staffing (structuring jobs and reporting relationships to efficiently implement plans) Managers Coping with complexity Leaders Coping with change 3 Basic Tasks Deciding what needs to be done Creating networks and relationships Ensuring people do the job

7. © The McGraw-Hill Companies, 2005 6 Trait Approach Focused on identifying characteristics or traits that distinguish leaders from followers. Examples: Business knowledge Self-confidence Intelligence Credibility (honesty, competence, forward-looking, inspirational) Desire to lead Drive

8. © The McGraw-Hill Companies, 2005 7 Exhibit 14-2: Traits that Distinguish Leaders Drive Leadership motivation Honesty and integrity Self-confidence Cognitive ability Knowledge of the business

9. © The McGraw-Hill Companies, 2005 8 Leader Behaviours Low ConsiderationHigh ConsiderationBehaviour Low Initiating High InitiatingStructure Behaviour

10. © The McGraw-Hill Companies, 2005 9 Leader Behaviours and Decision Styles Human Relations Laissez- faire Autocratic Democratic High Low Showing Consideration Initiating Structure

11. © The McGraw-Hill Companies, 2005 Blake & Mouton’s Leadership Grid 1 2 3 4 5 6 7 8 9 0 High Low HighLow Concern for production Concern for people Middle-of-the-Road Management 5,5 Impoverished Management 1,1 Country Club Management 1,9 Team Management 9,9 Authority Compliance 9,1 Blake & Mouton’s Leadership Grid

12. © The McGraw-Hill Companies, 2005 11 Contingency Approaches Examines the impact of the leader’s style and the situation on desired outcomes. All contingency theories define: – Leader’s behaviour or style – The situation – Outcome(s)

13. © The McGraw-Hill Companies, 2005 12 Four-Factor Model

14. © The McGraw-Hill Companies, 2005 13 Fiedler Contingency Theory of Leadership Effectiveness Premise: There must be a match between the leader’s style and the demands of the situation for the leader to be effective.

15. © The McGraw-Hill Companies, 2005 14 Fiedler Contingency Theory of Leadership Effectiveness (cont.) Assumption: Leadership style does not change. If a mismatch occurs between style and the situation, change the situation.

16. © The McGraw-Hill Companies, 2005 15 Leadership is defined by the primary source of motivation for the leader as determined by responses to a survey called the Least Preferred Co-worker Scale (LPC): Fiedler Contingency Theory of Leadership Effectiveness (cont.)

17. © The McGraw-Hill Companies, 2005 16 Fiedler Contingency Theory of Leadership Effectiveness (cont.) Relationship-motivated leader (high LPC) – Task-motivated leader (low LPC) – Independence motivated leader (middle LPC)

18. © The McGraw-Hill Companies, 2005 17 Situation defined in terms of three variables 1: Leader-Member Relations 2: Subordinate Task Structure 3: Position Power

19. © The McGraw-Hill Companies, 2005 18 Leader-Member Relations Acceptance of leader by subordinates Acceptance of leader by peers Support from superiors

20. © The McGraw-Hill Companies, 2005 19 Subordinate Task Structure Is the goal of the task clearly stated or known? Is there only one way to accomplish the task? Is there only one correct answer or solution? Is it easy to check whether the job was done right? Leader experience increases task structure.

21. © The McGraw-Hill Companies, 2005 20 Position Power The extent to which the leader possesses reward, punishment, and/or legitimate power.

22. © The McGraw-Hill Companies, 2005 21 Leader Effectiveness Leader Effectiveness – performance of the group in relation to other similar groups. Occurs if there is a match between the leader’s style and the situational determinants, the leader will be effective.

23. © The McGraw-Hill Companies, 2005 22 Hersey & Blanchard’s Situational Leadership Theory Premise: The leader should assess follower needs and adapt the style to those needs. Assumption: Leaders are diagnosticians and are capable of changing their style.

24. © The McGraw-Hill Companies, 2005 23 Situational Leadership Model RELATIONSHIP BEHAVIOR (High) (Low) (High)(Low) TASK BEHAVIOR High Relationship and Low Task High Task and Low Relationship and Low Task High Task and High Relationship (High)(Low) Follower Readiness Able and Willing Able but Unwilling Unable and Unwilling Unable but Willing

25. © The McGraw-Hill Companies, 2005 24 Path-Goal Theory Premise: The leader’s responsibility is to clarify the path that subordinates need to take to obtain work-related goals. Assumption: Leaders can change styles and are astute in assessing situational contingencies.

26. © The McGraw-Hill Companies, 2005 25 Leader Styles in Path-Goal Theory Leadership is defined in terms of four styles that emerge from two broad categories of leader behaviour: Instrumental (task-oriented) and Supportive (people/feelings oriented) behaviours.

27. © The McGraw-Hill Companies, 2005 26 Leader Styles in Path-Goal Theory (cont.) –Directive - gives directions –Supportive - shows concern –Achievement - emphasises excellence –Participative - involves subordinates

28. © The McGraw-Hill Companies, 2005 27 Situational Variables in Path Goal Theory Subordinate Attributes: –Authoritarianism –Internal-external orientation –Ability Work-Setting Attributes: –Task –Formal authority system –Primary work group

29. © The McGraw-Hill Companies, 2005 28 Effective Leadership Style Outcomes in Path Goal Theory Job Satisfaction Acceptance of Leader Motivational Behaviour Desired outcomes can be obtained if the leader correctly matches style with the situation.

30. © The McGraw-Hill Companies, 2005 29 Emotional Intelligence and Leadership Styles Coercive leaders Authoritative leaders Affiliative leaders Democratic leaders Pacesetting leaders Coaching leaders

31. © The McGraw-Hill Companies, 2005 30 Transformational Leadership Premise: Implementing organisational change is the major challenge that present and future leaders face in the rapidly changing global business environment.

32. © The McGraw-Hill Companies, 2005 31 Transformational Leadership Process Broadens and elevates the interests of their employees. Generates awareness and acceptance of the purposes and mission of the group. Stirs employees to look beyond their own self-interest for the good of the group.

33. © The McGraw-Hill Companies, 2005 32 Transformational Leader Strategies –Creates and articulates a vision –Mobilise commitment –Institutionalise change

34. © The McGraw-Hill Companies, 2005 33 How Leaders Get Extraordinary Things Done They challenge the process. They inspire a shared vision. They enable others to act. They model the way. They encourage the heart.

35. © The McGraw-Hill Companies, 2005 34 Three Substitutes for Leadership Individual job expertise. Intrinsic task satisfaction. Formalised rules and procedures.

36. © The McGraw-Hill Companies, 2005 35 Summary Managers carry out a broader set of functions than do leaders. Managers focus on using their authority to cope with complexity, see that things are done right, and assure resources are used efficiently. Leaders emphasise change and continuous improvement, and they seek to visualise the right thing to do by questioning practices and possibilities. Leaders seek to influence followers so they will want to work toward the leader’s goals. Leaders also appear to have certain traits in common that help others to have confidence in their credibility, a phenomenon explained by social-cognitive theory.

37. © The McGraw-Hill Companies, 2005 36 Summary continued 1 Several streams of research have focused on the leader’s style or behaviour as he or she interacts directly with the group to be influenced. Because predictions of effectiveness based solely on the leader’s behaviour or style have generated inconsistent results, most contemporary models incorporate one or more situational variables. These are called contingency theories.

38. © The McGraw-Hill Companies, 2005 37 Summary continued 2 Fiedler equates effectiveness to task versus relationship styles in combination with three contingency variables. Hersey and Blanchard pay attention to how the leader’s task and/or relationship behaviours are adapted to followers’ job maturity competencies. House and Mitchell view the leader’s behaviour as clarifying goals and showing the path to them.

39. © The McGraw-Hill Companies, 2005 38 Summary continued 2 Vroom and Yetton consider leadership effectiveness options by working through a decision tree of group and situational factors. A different form of leadership is necessary at the level of the larger organisation, where the leader acts as a visionary pathfinder and a transformer of organisational strategies and practices. At this level, leaders must learn the skills of creating a vision, mobilising commitment, and institutionalising change. They get extraordinary things done by being dedicated to continuous improvement and enabling others to act.

40. © The McGraw-Hill Companies, 2005 39 Summary continued 3 Some research suggests that there are times when leadership is not necessary or may even get in the way. There are even conditions that may be substitutes for leadership. Women and ethnic minorities face the dilemma that while they have more obstacles to overcome to break into responsible leadership positions, many who do succeed find the experience less than fulfilling. They choose to downsize the complexities in their lives by breaking away from big organisations to follow other more personal pursuits.