Leadership

1. Chapter 8 Leadership Michael A. Hitt C. Chet Miller Adrienne Colella

2. Knowledge Objectives • Define leadership and distinguish between formal and informal leaders. • Explain the trait concept of leadership. • Describe major behavioral theories of leadership and their similarities and differences. • Understand contingency theories of leadership and how they relate leadership effectiveness to situational factors.

3. Knowledge Objectives • Describe the differences between transactional and transformational leaders. • Discuss what factors can act as substitutes for leadership and why. • Compare how men and women lead and discuss possible reasons for any similarities or differences between their leadership styles. • Explain the similarities and differences in effective leadership styles across various clusters of countries.

4. The Nature of Leadership • The process of providing direction and influencing individuals or groups to achieve goals • Effective leaders are concerned with doing the “right things” • Create and communicate a vision of what the organization should be • Communicate with and gain the support of multiple constituencies • Persist in the desired direction even under bad conditions • Create the appropriate culture and to obtain the desired results

5. Exhibit 8-1 Common Traits Associated with Leadership Trait Theories of Leadership Energy Insightfulness Appearance Integrity Intelligence Persistence Judgment Self-confidence Verbal fluency Sense of humor Achievement drive Tolerance for stress Adaptability Interpersonal skills Aggressiveness Prestige Enthusiasm Socioeconomic position Extroversion Tact Initiative Adapted from Exhibit 8-1: Common Traits Associated with Leadership

6. Six Core Traits of Leadership • Drive • Ambition • Achievement motivation • Persistence • Tenacity • Initiative • Leadership motivation • Desire to lead, influence others, assume responsibility, and gain power • Socialized power motive • Personalized power motive

7. Six Core Traits of Leadership • Honesty and integrity • Truthful • Maintain consistency between what they say and what they do • Self-confidence • Confident in their actions and show that confidence to others • Learn from their mistakes • React positively to stress • Even-tempered • Display appropriate emotions

8. Six Core Traits of Leadership • Cognitive ability • High degree of intelligence • Process complex information • Deal with changing environments • Knowledge of business • Knowledge of business in which they are engaged • Make better decisions • Anticipate future problems • Understand implications of their actions

9. Behavioral Theories of Leadership • University of Michigan studies • Job-centered leadership style • A leadership behavioral style that emphasizes employee tasks and the methods used to accomplish them • Employee-centered leadership style • A leadership behavioral style that emphasizes employees’ personal needs and the development of interpersonal relationships

10. Behavioral Theories of Leadership Job-Centered Style Employee-Centered Style High A D Consideration B C Low Low High Initiating Structure Adapted from Exhibit 8-2: Comparison of Employee-Centered and Job-Centered Concepts with Consideration and Initiating Structure

11. Behavioral Theories of Leadership • Ohio State University studies • Consideration • A leadership behavioral style demonstrated by leaders who express friendship, develop mutual trust and respect, and have strong interpersonal relationships with subordinates • Initiating structure • A leadership behavioral style demonstrated by leaders who establish well-defined interpersonal relationships with patterns of organization and communication, define procedures, and delineate their relationships with subordinates

12. Behavioral Theories of Leadership • The Managerial Grid • Concern for people • One of the two dimensions of leadership behavior of the managerial grid; similar to the behavioral styles of consideration and employee-centered leadership • Concern for production • One of the two dimensions of leadership behavior of the managerial grid; similar to the behavioral styles of initiating structure and job-centered leadership

13. High Concern Concern for People The “Best” Leadership style Low Concern Low Concern High Concern Concern for Production The Managerial Grid 9 8 7 6 5 4 3 2 1 8, 7 style 2, 6 style 4,3 style 1 2 3 4 5 6 7 8 9 Adapted from Exhibit 8-3: Blake and Mouton’s Managerial Grid

14. Contingency Theories of Leadership • Fiedler’s contingency theory of leadership effectiveness • Leader effectiveness depends on the interaction of • Leader’s behavioral style • Favorableness of the leadership situation • Leader style measured by the LPC (least preferred coworker) scale • Situational favorableness assessed by three factors

15. ___:___:___:___:___:___:___:___ Cooperative Uncooperative 8 7 6 5 4 3 2 1 ___:___:___:___:___:___:___:___ Friendly Unfriendly 8 7 6 5 4 3 2 1 Fiedler’s Contingency Theory of Leadership Effectiveness • Leader style • Esteem for the Least Preferred Co-worker (Bipolar adjectives scale) • Low LPC score • Negative adjectives • Task-oriented leader (task achievement needs first) • High LPC score • More positive adjectives • Relationship-oriented leader (interpersonal relationship needs first)

16. Fiedler’s Contingency Theory of Leadership Effectiveness • Situation favorableness measured by three situational characteristics • Leader-member relations • Amount of respect subordinates have for the leader • Task structure • Degree to which tasks are simplified and easy for followers to understand • Position power • Degree to which the leader can reward, punish, promote or demote employees in the group

17. Fiedler’s Contingency Theory of Leadership Effectiveness Adapted from Exhibit 8-4: Fiedler’s Contingency Model of Leadership Effectiveness

18. Path-Goal Leadership Theory • Leader effectiveness depends on the degree to which a leader can enhance the performance expectancies and valences of her subordinates by: • Assigning individuals to tasks for which they have high valences (valence) • Supporting employees’ efforts to achieve task goals (effort → performance expectancy) • Encouragement • Training • Technical support • Tying extrinsic rewards (pay raise, recognition, promotion) to accomplishment of task goals (performance→reward instrumentality)

19. Path-Goal Leadership Theory • Leader behaviors • Directive leadership • Supportive leadership • Achievement-oriented leadership • Participative leadership • Upward-influencing leadership • Situational factors • Subordinates’ characteristics • Characteristics of the work environment

20. Leader Behavior and Situations Situational Factors Effective Leader Behaviors Subordinate Characteristics Characteristics of the Work Environment High need for affiliation Supportive High need for security Directive Internal locus of control Participative External locus of control Directive Structured task Directive Unstructured task Supportive Complex task Participative/ Achievement oriented High growth need strength Adapted from Exhibit 8-5: Interaction of Leader Behavior and Situational Factors

21. Leader Behavior and Situations Situational Factors Effective Leader Behaviors Subordinate Characteristics Characteristics of the Work Environment Low growth need strength Complex task Directive High growth need strength Simple task Supportive Low growth need strength Simple task Supportive Low willingness to leave, less anxiety, and high satisfaction High role clarity and low role conflict Upward influencing and contingent Adapted from Exhibit 8-5: Interaction of Leader Behavior and Situational Factors

22. Transactional Leadership • Transactional leaders • Display active management-by-exception behavior • Display contingent reward behavior • Understand what followers want to receive from their work, and attempt to give them what they desire, contingent on performance • Clarify links between performance and reward • Exchange rewards and promises of rewards for specified performance levels • Respond to the interests of followers only if the followers are performing satisfactorily

23. Transformational Leadership • Transformational leaders • Motivate followers to • Do more than expected (organizational vision and outcomes) • Continuously develop and grow • Increase their level of self-confidence • Place the interests of the team or organization before their own • Display charisma • Intellectually stimulate their subordinates • Provide individual consideration of subordinates

24. Intellectual stimulation Transformational Leader Charisma • Articulate clear and appealing vision • Communicate the vision • Delegate significant authority and responsibility • Eliminate unnecessary bureaucratic restraints • Promote cooperation and teamwork • Encourage open sharing of ideas and concerns • Encourage participative decision making • Provide coaching, training and other developmental experiences • Modify structure to promote key values and objectives Individual consideration Transformational Leadership Leader Behaviors Leader Behaviors

25. Substitutes for Leadership Characteristics of Associates Task Characteristics Organizational Characteristics Substitutes for Leadership High in competitiveness High in need for independence Professional orientation Routineness Feedback Intrinsic satisfaction • Highly formalized • Rules • Norms • Policies • Group cohesion

26. Gender Effects on Leadership • Do women lead differently than men? • Structural-cultural model of leader behavior • Often experience lack of power, lack of respect, and stereotypic expectations • Thus will develop leadership styles different from those of men • Socialization model • All have been selected and socialized by the same organization • Thus, men and women will display similar leadership styles • Both women and men may be effective leaders when style matches the situation

27. Global Differences in Leadership • Anglo cluster (ideal leader) • Charismatic influence and inspiration, encouraging participation • Diplomatic, delegating authority, allowing everyone to have their say • Arabic cluster (ideal leader) • Need to balance paradoxical set of expectations • Expected not to differentiate themselves from others and have modest styles • Expected to have great deal of power and control, and to direct most decisions and actions

28. Global Differences in Leadership • Germanic cluster (ideal leader) • Charismatic • Highly team-oriented • Participative • Southern Asia cluster (ideal leader) • Humane, participative, and charismatic • Expected to be benevolent while maintaining a strong position of authority