Chapter 14

1. Management 4th Edition Chuck Williams Chapter 14 Leadership Prepared byDeborah BakerTexas Christian University

2. What Would You Do? 43rd Floor, Tyco Headquarters, New York City. • The new CEO of Tyco is faced with $28 billion in debt, and the possibilities of bankruptcy • Dennis Kozlowski’s reign as CEO is still embarrassing, when he used funds as his personal piggy bank How can you get people to see that with sound management, Tyco can be an exceptional company?

3. What Is Leadership? After reading these sections, you should be able to: • explain what leadership is. • describe who leaders are and what effectiveleaders do.

4. Leadership DifferencesBetweenLeaders andManagers SubstitutesforLeadership 1

5. Leaders versus Managers MANAGERS Do things right Status quo Short-term Means Builders Problem solving LEADERS Do the right thing Change Long-term Ends Architects Inspiring & motivating 1.1 Adapted from Exhibit 14.1

6. Leaders versus Managers American organizations (and probably those in much of the rest of the industrialized world) are under led and over managed. They do not pay enoughattention to doing the right thing, while theypay too much attention to doing things right. --Warren Bennis 1.1

7. The Three M’s: Mission, Mentor, and Mirror • Business leaders can develop personal ethics by focusing on their mission, a mentor, and the mirror • Develop a personal mission statement. • Take care in choosing a mentor. • Stand in front of the mirror to assess yourethical performance as a business leader. DOING THE RIGHT THING Doing the Right Thing 1.1

8. Substitutes for Leadership • Leadership substitutes • subordinate, task, or organizational characteristics that make leaders redundant or unnecessary • Leadership neutralizers • subordinate, task, or organizational characteristics that interfere with a leader’s actions • Leaders don’t always matter • Poor leadership is not the cause of every organizational crisis 1.2

9. Leadership Substitutes and Neutralizers 1.2 Adapted from Exhibit 14.2

10. Who Leaders Are and What Leaders Do Leadership Traits Leadership Behavior 2

11. HonestyandIntegrity Desireto Lead Drive Self-Confidence LeadershipTraits Knowledgeof theBusiness EmotionalStability CognitiveAbility Leadership Traits 2.1 Adapted from Exhibit 14.3

12. Traits and Perceptionsof Leadership Effectiveness Intelligence 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% probability of success 75% Dominance 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% probability of success 57% Extroversion 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% probability of success 63% What Really Works: Leadership Traits 2.1

13. Charisma and Leadership Effectiveness Charisma and Performance 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% probability of success 72% Charisma and Perceived Leadership Effectiveness 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% probability of success 89% Charisma and Leader Satisfaction 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% probability of success 90% What Really Works: Leadership Traits 2.1

14. Initiating Structure The degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. Consideration The extent to which a leader is friendly, approachable, and supportive and shows concern for employees. Leadership Behaviors 2.2

15. 9 1,9 Country Club Management Team Management 9,9 8 7 6 5 4 3 2 Impoverished Management Authority-Compliance 1,1 9,1 1 1 2 3 4 5 6 7 8 9 Blake/Moulton Leadership Grid High Middle of theRoad5,5 5,5 Concern for People Low Concern for Production Low High 2.2 Adapted from Exhibit 14.4

16. Situational Approaches to Leadership After reading these sections, you should be able to: • explain Fiedler’s contingency theory. • describe how path-goal theory works. • discuss Hersey and Blanchard’s Situational Leadership theory. • explain the normative decision theory.

17. Situational Favorableness GroupPerformance LeadershipStyle = Putting Leaders in the Right Situation:Fiedler’s Contingency Theory 3

18. Putting Leaders in the Right Situation:Fiedler’s Contingency Theory Least Preferred Coworker Situational Favorableness Matching Leadership Stylesto Situations 3

19. Leadership Style:Least Preferred Coworker • Leadership style is the way a leader generally behaves toward followers • seen as stable and difficult to change • Style is measured by the Least Preferred Co-worker scale (LPC) • relationship-oriented • task-oriented 3.1

20. Leadership Style:Least Preferred Coworker Scale 3.1

21. Situational Favorableness • The degree to which a particular situation either permits or denies a leader the chance to influence the behavior of group members. Three factors: • Leader-member relations • Task structure • Position power Situational Favorableness 3.2

22. Situational Favorableness 3.2 Exhibit 14.7

23. Matching Leadership Styles to Situations 3.3 Exhibit 14.8

24. Path-Goal Theory A leadership theory that states that leaders can increase subordinate satisfaction and performance by clarifying and clearing the paths to goals and by increasing the number and kinds of rewards available for goal attainment. Path-Goal Theory 4

25. Clarify paths to goals Clear paths to goals by solving problems and removing roadblocks Increase the number and kinds of rewardsavailable for goal attainment Do things that satisfy followers today or will lead to future rewards or satisfaction Offer followers something unique and valuablebeyond what they’re experiencing Basic Assumptions of Path-Goal Theory 4 Adapted From Figure 14.9

26. Subordinate Contingencies • Perceived Ability • Locus of Control • Experience • Leadership Styles • Directive • Supportive • Participative • Achievement-Oriented • Outcomes • Subordinate satisfaction • Subordinate performance • Environmental Contingencies • Task Structure • Formal Authority System • Primary Work Group Path-Goal Theory 4 Adapted From Figure 14.10

27. Leadership Styles Subordinate andEnvironmental Contingencies Outcomes Adapting Leader Behavior:Path-Goal Theory 4

28. Leadership Styles • Directive • clarifying expectations and guidelines • Supportive • being friendly and approachable • Participative • allowing input on decisions • Achievement-Oriented • setting challenging goals 4.1

29. Leadership Styles • Martin Winterkorn of Audi uses a directive style. His employees know exactly what is expected of them.

30. Subordinate Environmental • Perceived ability • Locus of control • Experience Subordinate and Environmental Contingencies • Task structure • Formal authority system • Primary work group 4.2

31. Path Goal Theory:When to Use Leadership Styles 4.2 Adapted from Exhibit 14.11

32. Adapting Leadership Behavior Hersey and Blanchard’s Situational Leadership Theory WorkerReadiness Leadership Styles 5

33. Worker Readiness • The ability and willingness to take responsibility for directing one’s behavior at work • Components of worker readiness: • Job readiness • Psychological readiness 5.1

34. R4 confident willing able R3 insecure not willing able R2 confidentwilling not able R1 insecure not able not willing Worker Readiness 5.1

35. high task behavior low relationship behavior Telling(R1) Selling(R2) high task behavior high relationship behavior Participating(R3) low task behaviorhigh relationship behavior Delegating(R4) low task behaviorlow relationship behavior Leadership Styles 5.2

36. Normative Decision Theory DecisionStyles Decision Quality and Acceptance 6

37. Leader accepts any decisionsupported by the entire group AI AII CI CII GII Share problem with group, get ideas. Make decision, which may or may not reflect input. Share problem, get ideas from individuals. Select a solution yourself. Leader solves the problemor makes the decision Solve the problem yourself Obtain information. Select a solution yourself. Share problem with group. Together tries to reach a solution. Leader acts as facilitator. Decision Styles 6.1 Adapted from Exhibit 14.12

38. Decision Quality and Acceptance • Using the right amount of employee participation: • improves decision quality • improves acceptance • Decision tree helps leader identify optimal level of participation 6.2

39. Normative Theory Decision Rulesto Increase Decision Quality • Quality Rule • If the quality of the decision is important, then don't use an autocratic decision style • Leader Information Rule • If the quality of the decision is important, and if the leader doesn't have enough information to make the decision on his or her own, then don't use an autocratic decision style • Subordinate Information Rule • If the quality of the decision is important, and if the subordinates don't have enough information to make the decision themselves, then don't use a group decision style 6.2

40. Normative Theory Decision Rulesto Increase Decision Quality • Goal Congruence Rule • If the quality of the decision is important, and subordinates' goals are different from the organization's goals, then don't use a group decision style • Problem Structure Rule • If the quality of the decision is important, the leader doesn't have enough information to make the decision on his or her own, and the problem is unstructured, then don't use an autocratic decision style 6.2

41. Normative Theory Decision Rulesto Increase Decision Acceptance • Commitment Probability Rule • If having subordinates accept and commit to the decision is important, then don't use an autocratic decision style • Subordinate Conflict Rule • If having subordinates accept the decision is important and critical to successful implementation and subordinates are likely to disagree or end up in conflict over the decision, then don't use an autocratic or consultative decision style • Commitment Requirement Rule • If having subordinates accept the decision is absolutely required for successful implementation and subordinates share the organization's goals, then don't use an autocratic or consultative style 6.2

42. Strategic Leadership After reading this section, you should be able to: • explain how visionary leadership (i.e., charismatic and transformational leadership) helps leaders achieve strategic leadership.

43. Visionary Leadership CharismaticLeadership TransformationalLeadership 7

44. Charismatic Leadership • Creates an exceptionally strong relationship between leader and follower • Charismatic leaders: • articulate a clear vision, based on values • model values consistently with vision • communicate high performance expectations • display confidence in followers’ abilities 7.1

45. Kinds of Charismatic Leaders • Ethical Charismatics • provide developmental opportunities • open to positive and negative feedback • recognize others’ contributions • share information • concerned with the interests of the group • Unethical Charismatics • control and manipulate followers • do what is best for themselves • only want positive feedback • motivated by self-interest 7.1

46. Charismatic Leader Behaviors Ethical Charismatics Power is used to serve others Exercising Power Followers help develop the vision Creating the vision Communicating with followers Two-way communication Accepting feedback Open to feedback Stimulating followers Want followers to think and to questions the status quo Developing followers Focus on developing followers Living by moral standards Three virtues: courage, sense of fairness, integrity Ethical and Unethical Charismatic Leaders 7.1 Adapted from Exhibit 14.15

47. Charismatic Leader Behaviors Unethical Charismatics Ethical and Unethical Charismatic Leaders Power is used to dominate others Exercising Power Vision comes solely from the leader Creating the vision Communicating with followers One-way communication, not open to input from others Accepting feedback Prefer yes-men, punish candid feedback Stimulating followers Don’t want followers to think, prefer uncritical acceptance of own ideas Developing followers Insensitive to followers’ needs Living by moral standards Follow standards only if they satisfy immediate self interests 7.1 Adapted from Exhibit 14.15

48. Reducing Risks of Unethical Charismatics • Have a clearly written code of conduct • Recruit, select, and promote managers with high ethical standards • Train leaders how to value, seek, and used diverse points of view • Celebrate and reward those who exhibit ethical behaviors 7.1

49. Transformational Leadership • Generates awareness and acceptance of group’s purpose and mission • Gets followers to accomplish more than they intended or thought possible 7.2

50. Components of Transformational Leadership • Charisma or idealized influence • Inspirational motivation • Intellectual stimulation • Individualized consideration 7.2