Chapter 13

Explain what leadership is.

Management is getting work done through others; leadership is the process of influencing others to achieve group or organizational goals. Leaders are different from managers. The primary difference is that leaders are concerned about doing the right thing, while managers are concerned about doing things right. Organizations need both managers and leaders. But in general, companies are overmanaged and underled.

Describe who leaders are and what effective leaders do.

Trait theory says that effective leaders possess traits or characteristics that differentiate them from nonleaders. Those traits are drive, the desire to lead, honesty/integrity, self-confidence, emotional stability, cognitive ability, and knowledge of the business. These traits alone aren’t enough for successful leadership; leaders who have many or all of them must also behave in ways that encourage people to achieve group or organizational goals. Two key leader behaviours are initiating structure, which improves subordinate performance, and consideration, which improves subordinate satisfaction. There is no ideal combination of these behaviours. The best leadership style depends on the situation.

Explain Fiedler’s contingency theory.

Fiedler’s theory assumes that leaders are effective when their work groups perform well, that leaders are unable to change their leadership styles, that leadership styles must be matched to the proper situation, and that favourable situations permit leaders to influence group members. According to the Least Preferred Coworker (LPC) scale, there are two basic leadership styles. People who describe their LPC in a positive way have relationship-oriented leadership styles. By contrast, people who describe their LPC in a negative way have task-oriented leadership styles. Situational favourableness, which occurs when leaders can influence followers, is determined by leader–member relations, task structure, and position power. In general, relationship-oriented leaders with high LPC scores are better leaders under moderately favourable situations, while task-oriented leaders with low LPC scores are better leaders in highly favourable and unfavourable situations. The key is to accurately measure and match leaders to situations or to teach leaders how to change situational factors.

Describe how path–goal theory works.

Path–goal theory 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. For this to work, however, leader behaviour must be a source of immediate or future satisfaction for followers and must complement and not duplicate the characteristics of followers’ work environments. In contrast to Fiedler’s contingency theory, path–goal theory assumes that leaders can and do change their leadership styles (directive, supportive, participative, and achievement-oriented), depending on their subordinates (experience, perceived ability, internal or external locus of control) and the environment in which those subordinates work (task structure, formal authority system, primary work group).

Explain the normative decision theory.

The normative decision theory helps leaders decide how much employee participation should be used when making decisions. Using the right degree of employee participation improves the quality of decisions and the extent to which employees accept and are committed to decisions. The theory specifies five different decision styles or ways of making decisions: autocratic (AI or AII), consultative (CI or CII), and group (GII). The theory improves decision quality via the decision rules of quality, leader information, subordinate information, goal congruence, and problem structure. Normative decision theory then operationalizes these decision rules in the form of yes/no questions, as shown in the decision tree displayed in Exhibit 13.8.

Discuss gender and leadership.

Stereotypes, prejudice, and discrimination contribute to women’s under-representation in elite leadership roles by impacting perceptions of and responses to women as well as impacting the experiences of women themselves. The role of traits in understanding leadership emergence and effectiveness has been a controversial issue in the literature. A study by Reuvers et al. showed that employees report more innovative behaviour when the transformational leadership is displayed by male in comparison with female managers, confirming our gender bias hypothesis. In a separate experimental study, Kulich et al. suggested that the romance of leadership does exist for both men and women but that the process of pay allocation differs as a function of gender. Generally, for a female leader, it is based on perceptions of her charisma and leadership ability rather than directly on company performance.

Explain how visionary leadership (i.e., charismatic and transformational leadership) helps leaders achieve strategic leadership.

Strategic leadership requires visionary, charismatic, and transformational leadership. Visionary leadership creates a positive image of the future that motivates organizational members and provides direction for future planning and goal setting. Charismatic leaders have strong, confident, dynamic personalities that attract followers, enable the leader to create strong bonds, and inspire followers to accomplish the leader’s vision. Followers of ethical charismatic leaders work harder, are more committed and satisfied, are better performers, and are more likely to trust their leaders. The four components of transformational leadership are charisma or idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration.

Leadership

The process of influencing others to achieve group or organizational goals.

Trait theory

A leadership theory that holds that effective leaders possess a similar set of traits or characteristics.

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.

Contingency theory

A leadership theory that, in order to maximize work group performance, leaders must be matched to the situation that best fits their leadership style.

Least Preferred Coworker (LPC) Scale

A scale used by leaders to consider and grade all the people they have worked with, choosing the one person they have worked least well with.

Situational favourableness

The degree to which a particular situation either permits or denies a leader the chance to influence the behavior of group members.

Path–goal theory

A leadership theory that suggests leaders can increase subordinate satisfaction and performance by clarifying and clearing the paths to goals and increasing the number and kinds of rewards available for goal attainment.

Directive leadership

A leadership style in which the leader lets employees know precisely what is expected of them, gives them specific guidelines for performing tasks, schedules work, sets standards of performance, and ensures compliance with rules and regulations.

Supportive leadership

A leadership style in which the leader is friendly and approachable, shows concern for employees and their welfare, treats them as equals, and creates a friendly climate.

Participative leadership

A leadership style in which the leader consults employees for their suggestions and input before making decisions.

Achievement-oriented leadership

A leadership style in which the leader sets challenging goals, has high expectations of employees, and displays confidence that employees will assume responsibility and put forth extraordinary effort.

Strategic leadership

The ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate changes that will create a positive future for an organization.

Visionary leadership

Leadership that creates a positive image of the future that motivates organizational members and provides direction for future planning and goal setting.

Charismatic leadership

The behavioral tendencies and personal characteristics of leaders that create an exceptionally strong relationship between them and their followers.

Ethical charismatics

Charismatic leaders who provide developmental opportunities for followers, are open to positive and negative feedback, recognize others' contributions, share information, and have moral standards that emphasize the larger interests of the group, organization, or society.

Unethical charismatics

Charismatic leaders who control and manipulate followers, do what is best for themselves instead of their organizations, want to hear only positive feedback, share only information that benefits themselves, and have moral standards that put their interests before everyone else's.

Transformational leadership

Leadership that generates awareness and acceptance of a group's purpose and mission and gets employees to see beyond their own needs and self-interests for the good of the group.

Transactional leadership

Leadership based on an exchange process, in which followers are rewarded for good performance and punished for poor performance.