Fortune, March 2, 1998

1. “Great business leaders ought to reveal all the traits of a great lover -- passion, commitment, ferocity. Nothing less will do.” Fortune, March 2, 1998

2. Agenda 6J:130 3/21 • Announcements • Concepts and Terms • Thought Activity • Leadership Mini-Lecture, v1 • Video: Herb Kelleher • Leadership Mini-Lecture, v2

3. Textbook Trait theories Behavioral Theories Situational Contingency Theories Transactional and transformational leadership Substitutes and neutralizers Lecture Supplements Does leadership make a difference? Typology of leadership theories Concepts and Terms

4. What makes a leader? Thought Exercise

5. What is Leadership? • Definition: Leadership is the ability to influence a group toward goals. (There are many other definitions). • Considered distinct from “management” today, but hasn’t always been...

6. Does LEADERSHIP make a difference? • Empirical Data • Leadership accounts for 20-45% of variance in organizational outcomes. • Outcomes influenced by many other factors outside the control of the leader. • Anecdotal Data • Business--Rockefeller, Gates, Welch, Grove, Murdoch • Society--Lincoln, Roosevelt, King, Ghandhi

7. Typology of Leadership Theories Universal Contingency Trait Great Man Fiedler’s LPC Blake & Mouton Hersey & Blanchard Behavior

8. Universal Leadership Theories There is one best style of leadership for all situations.

9. Universal Theories • Trait Theories focus on leader characteristics: • Abilities & Personality (Great Man) • Physical characteristics • Behavior Theories focus on leader behaviors in U of M and OSU studies: • Concern for production (initiating structure) • Concern for people (showing consideration)

10. Contingency Leadership Theories Different leadership styles will be better in different situations.

11. Contingency Theories • Trait Theories focus on leader characteristics in different situations: • Personality (Fiedler’s LPC) • Behavior Theories focus on leader behaviors in different situations: • Hersey & Blanchard • Path-Goal Theory

12. Herb Kelleher Video

13. Transformational Leadership • Transformational, charismatic, visionary leadership all very similar. Simplest version suggests the leader has: • Charisma • and practices: • Inspirational Communication • Intellectual Stimulation • Individualized Consideration

14. Can it be learned? Yes. Average level of transformational leadership behavior on part of leader 2 weeks before training 5 months after training Source: Barling, J., Weber, T., & Kelloway, E. K. (1996). Effects of transformational leadership training on attitudinal and financial outcomes: A field experiment. Journal of Applied Psychology, 81, 827-832.

15. Does it influence outcomes? Yes. Average number of personal loan sales of subordinates reporting to leader 2 weeks before training 5 months after training Source: Barling, J., Weber, T., & Kelloway, E. K. (1996). Effects of transformational leadership training on attitudinal and financial outcomes: A field experiment. Journal of Applied Psychology, 81, 827-832.

16. Transactional vs. Transformational Leaders • In contrast, the transactional leader is characterized by: • Contingent Reward • Active/Passive Management by Exception • Laissez-Faire • Transactional leaders can be good managers but not necessarily great leaders!

17. Summary • Today • Definition of leadership and why its important. • Taxonomy of leadership theories--universal contingency Theories • Herb Kelleher • Transformational Leadership • Study on Transformational Leadership • Next time • Influence -- make sure to read Yukl!