leadership

Leadership

Course Instructor: Madan L. Pradhan 1

L E A D E R S

D.L. Rogers Corp., based in Bedford, Texas, owns and operates 54 franchises of Sonic Corp., a chain of fast-food drive-in restaurants. Jack Hartnett, Rogers's president, leads by combining ingredients from both the Stone Age and the New Age.1 Hartnett prides himself on knowing everything about his employees—both at work and at home. If they have marital problems or credit-card debt, he wants to know. And he thinks nothing of using that information if he thinks he can help. For instance, how many executives do you know who counsel employees on their sex life? When a wife of one of his managers called Hartnett to say her husband was impotent and didn't know what to do, Hartnett had an answer. He met with the couple in a motel room, where he prodded the fellow to confess to an affair and to beg for forgiveness. Is Hartnett's style intrusive? Yes! But neither he nor his employees consider it a problem. "There are no secrets here," he says. No subject is too delicate for his ears. And his defense? He's merely doing what any good friend might do. Also, he believes that the more he knows about his workers, the more he can help them stay focused at work and happy at home. Hartnett plays golf with his managers, sends them personally signed birthday cards, and drops by their homes to take them to dinner. But if you think he's "Mr. Nice Guy," think again. He badmouths academic theories that propose that leaders need to persuade workers to buy in to the leader's vision. Hartnett instructs his employees to "do it the way we tell you to do it." He's perfectly comfortable using the authority in his position to make rules and dish out punishments. One of Hartnett's basic rules is "I will only tell you something once." Break one of his rules twice and he'll fire you. The managers who work for Hartnett are well compensated for meeting his demanding requirements. His unit managers and regional managers earn an average of $65,000 and $150,000, respectively. This compares with industry averages of $30,000 and $52,700. Moreover, Hartnett's managers are eligible for upwards of a 15 percent bonus program as well as an opportunity to own 25 percent of the company. Does Hartnett seem inconsistent? Maybe. He believes in openness, integrity, and honesty, but he expects as much as he gives. It's not an option. So he's "your best friend," and, at the same time, he's rigid and autocratic. He admits to purposely keeping everybody slightly off balance "so they'll work harder." Hartnett's approach to leadership seems to be effective. His per-store revenues are nearly 18 percent higher than the chain's average, and profits are 25 percent above the norm. Moreover, people seem to like working for him. In an industry known for high turnover, Hartnett's managers stay about nine years, compared with an industry average of less than two.

Leadership


Because the topic of leadership has fascinated people for centuries, definitions abound. This section presents a definition of leadership and highlights the similarities and differences between leading versus managing. Leadership Defined

Disagreement about the definition of leadership stems from the fact that it involves a complex interaction among the leader, the followers, and the situation. For example, some researchers define leadership in terms of personality and physical traits, while others believe leadership is represented by a set of prescribed behaviors. In contrast, other researchers believe that the concept of leadership doesn't really exist. There is a common thread, however, among the different definitions of leadership. The common thread is social influence. Leadership is defined as "a social influence process in which the leader seeks the voluntary participation of subordinates in an effort to reach organizational goals."5 Tom Peters and Nancy Austin, authors of the best-seller, A Passion for Excellence, describe leadership in broader terms: Leadership means vision, cheerleading, enthusiasm, love, trust, verve, passion, obsession, consistency, the use of symbols, paying attention as illustrated by the content of one's calendar, out-and-out drama (and the management thereof), creating heroes at all levels, coaching, effectively wandering around, and numerous other things. Leadership must be present at all levels of the organization. It depends on a million little things done with obsession, consistency, and care, but all of those million little things add up to nothing if the trust, vision, and basic belief are not there. As you can see from this definition, leadership clearly entails more than wielding power and exercising authority.

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Leading versus Managing It is important to appreciate the difference between leadership and management to fully understand what leadership is all about. Bernard Bass, a leadership expert, concluded that "leaders manage and managers lead, but the two activities are not synonymous." Bass tells us that although leadership and management overlap, each entails a unique set of activities or functions. Broadly speaking, managers typically perform functions associated with planning, investigating, organizing, and control, and leaders deal with the interpersonal aspects of a manager's job. Leaders inspire others, provide emotional support, and try to get employees to rally around a common goal. Leaders also play a key role in creating a vision and strategic plan for an organization. Managers, in turn, are charged with implementing the vision and strategic plan. Table B summarizes the key differences found between leaders and managers.

Table B: Differences between Leaders and Managers

LEADERS MANAGERS Innovate Administer Develop Maintain Inspire Control Long-term view Short-term view Ask what and why Ask how and when Originate Initiate Challenge the status quo Accept the status quo Do the right things Do things right

Source: Distinctions were taken from W G Bennis, On Becoming a Leader (Reading, MA: Addison-Wesley, 1989).

The distinction between leaders and managers is more than a semantic issue for four reasons:

1. It is important from a hiring standpoint. Because leaders and managers perform a subset of unique functions, it is important to recruit and select people who have the required intellectual abilities, experience, and job-relevant knowledge to perform their jobs.

2. Differences may affect group effectiveness. Work group performance can be increased by staffing a productive mix of leaders and managers.

3. Successful organizational change is highly dependent upon effective leadership throughout an organization. Senior executives cannot create change on their own. According to organizational change expert John Kotter, successful organizational transformation is 70% to 90% leadership and 10% to 30% management.

4. Distinctions between leading and managing highlight the point that leadership is not restricted to people in particular positions or roles. Anyone from the bottom to the top of an organization can be a leader. Many an informal leader have contributed to organizational effectiveness. Consider the behavior exhibited by Skip Tobey, an employee at America West Airlines.

"I'm not just an aircraft cleaner," the 36-year old Phoenix native said. "That's my title, but that's not the end of my job."

Tobey said he looks for ways to help passengers, lending a hand to young families maneuvering strollers through narrow aircraft aisles and assisting elderly travelers.

"My satisfaction is tied into quality, helping the passengers," he said. "No matter what it takes, if it means going to the furthest extreme, I'll do it."

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Skip's behavior is not only inspirational, but it supports leadership expert Warren Bennis's conclusion about leaders and managers. Bennis characterized managers as people who do things right and leaders as individuals who do the "right" things. Skip Tobey is clearly doing the "right" things to help America West provide excellent customer service. Trait and Behavioral Theories of Leadership This section examines the two earliest approaches used to explain leadership. Trait theories focused on identifying the personal traits that differentiated leaders from followers. Behavioral theorists examined leadership from a different perspective. They tried to uncover the different kinds of leader behaviors that resulted in higher work group performance. Both approaches to leadership can teach current and future managers valuable lessons about leading. Trait Theory

At the turn of the 20th century, the prevailing belief was that leaders were born, not made. Selected people were thought to possess inborn traits that made them successful leaders. A leader trait is a physical or personality characteristic that can be used to differentiate leaders from followers. Before World War II, hundreds of studies were conducted to pinpoint the traits of successful leaders. Dozens of leadership traits were identified. During the postwar period, however, enthusiasm was replaced by widespread criticism. Studies conducted by Ralph Stogdill in 1948 and by Richard Mann in 1959, which sought to summarize the impact of traits on leadership, caused the trait approach to fall into disfavor. Stogdill's and Mann's Findings: Based on his review, Stogdill concluded that five traits tended to differentiate leaders from average followers: (1) intelligence, (2) dominance, (3) self-confidence, (4) level of energy and activity, and (5) task-relevant knowledge.'' Andy Grove, CEO of Intel, and Bill Gates, chairman and CEO of Microsoft, have some of these traits: For one thing, each personifies the word "stubborn." Gates has been known to smash in the dashboard of a rental car after a prickly encounter with Grove, and to this day the pair occasionally squabble like an old married couple. They share other volatile traits too. Both are piercingly analytical thinkers who combine hands-on technical smarts with take-no-prisoners business savvy. Both absolutely hate to lose. Although Grove and Gates possess some of the traits identified by Ralph Stogdill, research revealed that these five traits did not accurately predict which individuals became leaders in organizations. People with these traits often remained followers. Mann's review was similarly disappointing for the trait theorists. Among the seven categories of personality traits he examined, Mann found intelligence was the best predictor of leadership. However, Mann warned that all observed positive relationships between traits and leadership were weak (correlations averaged about 0.15). Together, Stogdill's and Mann's findings dealt a near deathblow to the trait approach. But now, decades later, leadership traits are once again receiving serious research attention. Contemporary Trait Research: Two OB researchers concluded in 1983 that past trait data may have been incorrectly analyzed. By applying modern statistical techniques to an old database, they demonstrated that the majority of a leader's behavior could be attributed to stable underlying traits. Unfortunately, their methodology did not single out specific traits. A 1986 meta-analysis by Robert Lord and his associates remedied this shortcoming. Based on a reanalysis of Mann's data and subsequent studies, Lord concluded that people have leadership prototypes that affect our perceptions of who is and who is not an effective leader. Your leadership prototype is a mental representation of the traits and behaviors that you believe are possessed by leaders. We thus tend to perceive that someone is a leader when he or she exhibits traits or behaviors that are consistent with our prototypes. Lord's research demonstrated that people are perceived as being leaders when they exhibit the traits associated with intelligence, masculinity, and dominance.

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More recently, a pair of leadership researchers asked the following open-ended question to more than 20,000 people around the world: "What values (personal traits or characteristics) do you look for and admire in your superiors?" The top four traits included honesty, forward-looking, inspiring, and competent. The researchers concluded that these four traits constitute a leader's credibility. This research suggests that people want their leaders to be credible and to have a sense of direction. Gender and Leadership: The increase of women in the workforce has generated much interest in understanding the similarities and differences in female and male leaders. Important issues concern whether women and men (1) assume varying leadership roles within work groups, (2) use different leadership styles, (3) are relatively more or less effective in leadership roles, and (4) whether there are situational differences that produce gender differences in leadership effectiveness. Three meta-analyses were conducted to summarize research pertaining to these issues. The first meta-analysis demonstrated that men and women differed in the type of leadership roles they assumed within work groups. Men were seen as displaying more overall leadership and task leadership. In contrast, women were perceived as displaying more social leadership. Results from the second meta-analysis revealed that leadership styles varied by gender. Women used a more democratic or participative style than men. Men employed a more autocratic and directive style than women. Finally, a recent meta-analysis of more than 75 studies uncovered three key findings: (1) Female and male leaders were rated as equally effective. This is a very positive outcome because it suggests that despite barriers and possible negative stereotypes toward female leaders, female and male leaders were equally effective. (2) Men were rated as more effective leaders than women when their roles were defined in more masculine terms, and women were more effective than men in roles defined in less masculine terms. (3) Gender differences in leadership effectiveness were associated with the percentage of male leaders and male subordinates. Specifically, male leaders were seen as more effective than females when there was a greater percentage of male leaders and male subordinates. Interestingly, a similar positive bias in leadership effectiveness was not found for women. Trait Theory in Perspective: We can no longer afford to ignore the implications of leadership traits. Traits play a central role in how we perceive leaders. It is important to determine the traits embodied in people's schemata (or mental pictures) for leaders. If those traits are inappropriate (i.e., foster discriminatory selection and invalid performance appraisals), they need to be corrected through training and development. Moreover, organizations may find it beneficial to consider selected leadership traits when choosing among candidates for leadership positions.22 Gender should not be used as one of these traits. Consider, for example, the qualities that Colin Powell, former chairman of the Joint Chiefs of Staff and White House national security advisor, believes that effective leaders need to have in the 21st century: Leadership will always require people who have a vision of where they wish to take "the led." Leadership will always require people who are able to organize the effort of [others] to accomplish the objectives that flow from the vision. And leadership will always put a demand on leaders to pick the right people.... Leadership also requires motivating people. And that means pushing the vision down to every level of the organization. What will make things different in the 21st century, however, is that the world is going through a transformation ... At the same time, the world is being fundamentally reshaped by the information and technology revolution, which is supplanting the industrial revolution……The leaders of this new industrial-information era have to be able use these tools and understand the power of information and technology—and how that gives them new opportunities.

In contrast to these traits, the International OB outlines the relevant leadership traits of Russian leaders from the 1400s to the present time Figure A in page 7. As you can see, Russian organizations need to nurture and develop a similar but different set of leadership traits.

Leadership


Behavioral Styles Theory

This phase of leadership research began during World War II as part of an effort to develop better military leaders. It was an outgrowth of two events: the seeming inability of trait theory to explain leadership effectiveness and the human relations movement, an outgrowth of the Hawthorne Studies. The thrust of early behavioral leadership theory was to focus on leader behavior, instead of on personality traits. It vas believed that leader behavior directly affected work group effectiveness. This led researchers to identify patterns of behavior (called leadership styles) that enabled leaders to effectively influence others. The Ohio Studies: Researchers at Ohio State University began by generating a list of behaviors exhibited by leaders. At one point, the list contained 1,800 statements lat described nine categories of leader behavior. Ultimately, the Ohio State researchers concluded there were only two independent dimensions of leader behavior: consideration and initiating structure. Consideration involves leader behavior associated with creating mutual respect or trust and focuses on a concern for group members' needs and desires. Initiating structure is leader behavior that organizes and defines what group members should be doing to maximize output. These two dimensions of leader behavior were oriented at right angles to yield four behavioral styles of leadership (see Figure 2). It initially was hypothesized that a high-structure, high-consideration style would be the one best style of leadership. Through the years, the effectiveness of the high-high style has been tested many times. Overall, results have been mixed. Researchers thus concluded that there is not one best style of leadership. Rather, it is argued that effectiveness of a given leadership style depends on situational factors.

Figure 2: Four Leadership Styles Derived from the Ohio State Studies

Con

sider

ation

High Low

Low High Initiating Structure

University of Michigan Studies As in the Ohio State studies, this research sought to identify behavioral differences between effective and ineffective leaders. Researchers identified two different styles of leadership: one was employee centered, the other was job centered. These behavioral styles parallel the consideration and initiating-structure styles identified by the Ohio State group. In summarizing the results from these studies, one management expert concluded that effective leaders (1) tend to have supportive or employee-centered relationships with employees, (2) use group rather than individual methods of supervision, and (3) set high performance goals. Blake and Mouton's Managerial/Leadership Grid®: Perhaps the most widely known behavioral styles model of leadership is the Managerial Grid.® Behavioral scientists Robert Blake and Jane Srygley Mouton developed and trademarked the grid. They use it to demonstrate that there is one best style of leadership. Blake and Mouton's Managerial Grid® (renamed the Leadership Grid® in 1991) is a matrix formed by the intersection of two dimensions of leader behavior (see Figure 3). On the horizontal axis is "concern for production." "Concern for people" is on the vertical axis.

Low Structure, high consideration

Less emphasis is placed on while the leader concentrates on satisfying employee needs and wants.

High Structure, high consideration

The leader provides a lot of guidance about tow tasks can be completed while being highly considerate of employee needs and wants.

Low Structure, low consideration

The leader fails to provide necessary structure and demonstrates little consideration for employee needs and wants.

Low Structure, high consideration

Primary emphasis is placed on structuring employee tasks while the leader demonstrates little consideration for employee needs and wants.

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Figure 3 The Leadership Grid®

Con

cern

Peo

ple

Concern for Production Blake and Mouton point out that "the variables of the Managerial Grid® are attitudinal and conceptual, with behavior descriptions derived from and connected with the thinking that lies behind action." In other words, concern for production and concern for people involve attitudes and patterns of thinking, as well as specific behaviors. By scaling each axis of the grid from 1 to 9, Blake and Mouton were able to plot five leadership styles. Because it emphasizes teamwork and interdependence, the 9,9 style is considered by Blake and Mouton to be the best, regardless of the situation. In support of the 9,9 style, Blake and Mouton cite the results of a study in which 100 experienced managers were asked to select the best way of handling 12 managerial situations. Between 72% and 90% of the managers selected the 9,9 style for each of the 12 situations. Moreover, Blake and Mouton report, "The 9,9, orientation . . . leads to productivity, satisfaction, creativity, and health." Critics point out that Blake and Mouton's research may be self-serving. At issue is the grid's extensive use as training and consulting tool for diagnosing and correcting organizational problems. Behavioral Styles Theory in Perspective: By emphasizing leader behavior, something that is learned, the behavioral style approach makes it clear that leaders are made, not born. This is the opposite of the trait theorists' traditional assumption. Given what we know about behavior shaping and model-based training, leader behaviors can be systematically improved and developed. For example, a study demonstrated that employee creativity was increased when leaders were trained to (1) help employees identify problems and (2) enhance employees feelings of self-efficacy.

1,9 Country club management

Thoughtful attention to needs of people for satisfying relationships leads to a

comfortable friendly organization atmosphere and

work tempo.

9,9 Team management Work accomplishment is from

committed people; interdependence through a

common stake in organization purpose leads to relationships

of trust and respect.

1,1

Impoverished management Exertion of minimum effort to

get required work done is appropriate to sustain

organization membership.

9,1

Authority-compliance Efficiency in operations results

from arranging conditions of work in such a way that human

elements interfere to a minimum degree.

5,5

Middle-of-the-road management Adequate organization

performance is possible through balancing the necessity to get out work with maintaining morale of

people at a satisfactory level.

High

9

8

7

6

5

4

3

2

1

Low

Low 1 2 3 4 5 6 7 8 9 High

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Figure A: International Organizational Behaviour Russian Leadership Traits in Three Eras

LEADERSHIP TRAIT TRADITIONAL RUSSIAN SOCIETY (1400S TO 1914)

THE RED EXECUTIVE (1917 TO 1991)

THE MARKET-ORIENTED MANAGER (1991 TO PRESENT)

LEADERSHIP MOTIVATION

Power Powerful autocrats

Centralized leadership stifled grass-roots democracy

Shared power and ownership

Responsibility Centralization of responsibility

Micromanagers and macropuppets

Delegation and strategic decision making

DRIVE Achievement

ti ti Don't rock the boat Frustrated pawns The sky's the limit

Ambition Equal poverty for all Service to party and

collective good Overcoming the sin of being a winner

Initiative Look both ways Meticulous rule following

and behind-the –scenes finessing

Let's do business

Energy Concentrated spasms of labor

"8-hour day," 8 to 8, firefighting

8-day week, chasing opportunities

Tenacity Life is a struggle Struggling to accomplish the routine

Struggling to accomplish the new

HONESTY AND INTEGRITY

Dual ethical standard Deception in dealings, fealty in friendship

Two sets of books, personal integrity

Wild capitalism, personal trust

Using connections (blat)

Currying favor with landowners

Greasing the wheels of the state

Greasing palms, but learning to do business straight

SELF-CONFIDENCE

From helplessness to bravado

From inferior quality to "big is beautiful"

From cynicism to overpromising

Behavioral styles research also revealed that there is no one best style of leadership. The effectiveness of a particular leadership style depends on the situation at hand. For instance, employees prefer structure over consideration when faced with role ambiguity.30. Situational Theories

Situational leadership theories grew out of an attempt to explain the inconsistent findings about traits and styles. Situational theories propose that the effectiveness of a particular style of leader behavior depends on the situation. As situations change, different styles become appropriate. This directly challenges the idea of one best style of leadership. Let us closely examine three alternative situational theories of leadership that reject the notion of one best leadership style. Fiedler's Contingency Model Fred Fiedler, an OB scholar, developed a situational model of leadership. It is the oldest and one of the most widely known models of leadership. Fiedler's model is based on the following assumption: The performance of a leader depends on two interrelated factors: (1) the degree to which the situation gives the leader control and influence—that is, the likelihood that [the leader] can successfully accomplish the job; and (2) the leader's basic motivation—that is, whether [the leader's self-esteem depends primarily on accomplishing the task or on having close supportive relations with others.

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With respect to a leader's basic motivation, Fiedler believes that leaders are either task motivated or relationship motivated. These basic motivations are similar to initiating structure/concern for production and consideration/concern for people. Consider the basic leadership motivation possessed by Dr. William Catacosinos, chief executive officer of Long Island Lighting Co.: Over the years, people who know him say he developed a fanaticism for control and for pushing subordinates hard… His first year at Lilco, Dr. Catacosinos cut nearly 1,000 jobs from the 6,000-person workforce, then stared down International Brotherhood of Electrical Workers Local 1049, which represents 85% of Lilco's workers, until it went on strike over vacation and overtime givebacks. Soon afterward, he fired Lilco's president and most of his predecessor's management team. He became so intensely disliked, especially by rank-and-file workers, that some refused to greet him. "I'd stick out my hand and people would just walk away," he says.

But in running the beleaguered company, he relies on a result-oriented style that even his critics admit has saved the utility from ruin. He inherited Lilco on the brink of bankruptcy from cost overruns and Shoreham-related litigation and turned it into a strong, though unpredictable, stock-market performer. Dr. Catacosinos's task motivation clearly helped save Lilco from bankruptcy. Fiedler's theory also is based on the premise that leaders have one dominant leadership style that is resistant to change. He suggests that leaders must learn how to match their leadership style to the amount of control within a leadership situation. After discussing the components of situational control and the leadership matching process, we review relevant research and managerial implications. Situational Control: Situational control refers to the amount of control and influence the leader has in her or his immediate work environment. Situational control ranges from high to low. High control implies that the leader's decisions will produce predictable results because the leader has the ability to influence work outcomes. Low control implies that the leader's decisions may not influence work outcomes because the leader has very little influence. There are three dimensions of situational control: leader-member relations, task structure, and position power. These dimen-sions vary independently, forming eight combinations of situational control (see Figure 4). The three dimensions of situational control are defined as follows: Leader-member relations reflect the extent to which the leader has the support, loyalty, and

trust of the work group. This dimension is the most important component of situational control. Good leader-member relations suggest that the leader can depend on the group, thus ensuring that the work group will try to meet the leader's goals and objectives.

Task structure is concerned with the amount of structure contained within tasks performed by the work group. For example, a managerial job contains less structure than that of a bank teller. Since structured tasks have guidelines for how the job should be completed, the leader has more control and influence over employees performing such tasks. This dimension is the second most important component of situational control.

Position power refers to the degree to which the leader has formal power to is reward, punish, or otherwise obtain compliance from employees.

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Figure 4 Representation of Fiedler’s Contingency Model`

Linking Leadership Motivation and Situational Control Fiedler's complete contingency model is presented in Figure above. The horizontal axis breaks out the eight control situations. Each situation represents a unique combination of leader-member relations, task structure, and position power. The vertical axis indicates the level of leader effectiveness. Plotted on the resulting quadrant are lines indicating those situations in which task-motivated (dotted line) and relationship-motivated (solid line) leaders are predicted to be effective. For those situations in which the leader has high control (situations I, II, and III), task-motivated leaders are hypothesized to be more effective than relationship-motivated leaders. Under conditions of moderate control (situations IV, V, and VI), relationship-motivated leaders are expected to be more effective. Finally, the results orientation of task-motivated leaders is predicted to be more effective under conditions of low control (situations VII and VIII). Research and Managerial Implications: The overall accuracy of Fiedler's contingency model was tested through a meta-analysis of 35 studies containing 137 leader style-performance relations. According to the researchers' findings, (1) the contingency theory was correctly induced from studies on which it was based; (2) for laboratory studies testing the model, the theory was supported for all leadership situations except situation II; and (3) for field studies testing the model, three of the eight situations (IV, V, and VII) produced completely supportive results, while partial support was obtained for situations I, II, III, VI, and VIII. A more recent meta-analysis of data obtained from 1,282 groups also provided mixed support for the contingency model. These findings suggest that Fiedler's model needs theoretical refinement. The major contribution of Fiedler's model is that it prompted others to examine the contingency nature of leadership. This research, in turn, reinforced the notion that there is no one best style of leadership. Leaders are advised to alter their task and relationship orientation to fit the demands of the situation at hand.

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Path – Goal Theory Path—goal theory is based on the expectancy theory of motivation. Expectancy theory proposes that motivation to exert effort increases as one's effort performance outcome expectations improve. Path-goal theory focuses on how leaders influence followers' expectations. Robert House originated the path-goal theory of leadership. He proposed a model that describes how expectancy perceptions are influenced by the contingent relationships among four leadership styles and various employee attitudes and behaviors (see Figure 5). According to the path-goal model, leader behavior is acceptable when employees view it as a source of satisfaction or as paving the way to future satisfaction. In addition, leader behavior is motivational to the extent it (1) reduces roadblocks that interfere with goal accomplishment, (2) provides the guidance and support needed by employees, and (3) ties meaningful rewards to goal accomplishment. Because the model deals with pathways to goals and rewards, it is called the path-goal theory of leadership. House sees the leader's main job as helping employees stay on the right paths to challenging goals and valued rewards.

Figure 5 A General Representation of House’s Path-Goal Theory

Leadership Styles House believes leaders can exhibit more than one leadership style. This contrasts with Fiedler, who proposes that leaders have one dominant style. The four leadership styles identified by House are as follows: Directive leadership. Providing guidance to employees about what should be done and how to

do it, scheduling work, and maintaining standards of performance. Supportive leadership. Showing concern for the well-being and needs of employees, being

friendly and approachable, and treating workers as equals. Participative leadership. Consulting with employees and seriously considering their ideas when

making decisions. Achievement-oriented leadership. Encouraging employees to perform at their highest level by

setting challenging goals, emphasizing excellence, and demon strating confidence in employee abilities.

Research evidence supports the idea that leaders exhibit more than one leadership style. 39 Descriptions of business leaders reinforce these findings. For example, PepsiCo's CEO, Roger Enrico, uses multiple leadership styles to influence others: "Roger is at once one of the warmest and most personable people, and so cold," says a former PepsiCo executive. "His strength is his ability to charm you and get you on his side, and also dispassionately evaluate a business and fix it. He never gets sucked into the culture, the history of a business. So he's not afraid to cut the fat, storm ahead, reorganize, shut the factory, kill the product line. He's agile and he's cunning."

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He challenges everything and assumes nothing. For example, when Enrico took charge at PepsiCo's Frito-Lay division five years ago, the numbers looked fine. But Enrico smelled something rotten at the food company. Profits were rising, it turned out, because management was pumping up prices on Doritos and other snacks. Frito was scrimping on product quality. Enrico slashed costs, firing 1,700 workers and sweeping out management. Contingency Factors Contingency factors are situational variables that cause one style of leadership to be more effective than another. In this context, these variables affect expectancy or path-goal perceptions. This model has two groups of contingency variables (see Figure 16-5). They are employee characteristics and environmental factors. Five important employee characteristics are locus of control, task ability, need for achievement, experience, and need for clarity. Three relevant environmental factors are (1) the employee's task, (2) the authority system, and (3) the work group. All these factors have the potential for hindering or motivating employees. Research has focused on determining whether the various contingency factors influence the effectiveness of different leadership styles. A recent summary of this research revealed that only 138 of 562 (25%) contingency relationships tested confirmed the theory. Although these results were greater than chance, they provided limited support for the moderating relationships predicted within path-goal theory. On the positive side, however, the task characteristics of autonomy, variety, and significance and the employee characteristics of ability, experience, training and knowledge, professional orientation, indifference to organizational rewards, and need for independence obtained results that were semiconsistent with the theory. Managerial Implications:There are two important managerial implications. First, leaders possess and use more than one style of leadership. Managers thus should not be hesitant to try new behaviors when the situation calls for them. Second, a small set of task and employee characteristics are relevant contingency factors. Managers are encouraged to modify their leadership style to fit these various task and employee characteristics. For example, supportive and achievement leadership are more likely to be satisfying when employees have a lot of ability and experience. Hersey and Blanchard's Situational Leadership Theory Situational leadership theory (SLT) was developed by management writers Paul Hersey and Kenneth Blanchard. According to the theory, effective leader behavior depends on the readiness level of a leader's followers. Readiness is defined as the extent to which a follower possesses the ability and willingness to complete a task. Willingness is a combination of confidence, commitment, and motivation. The SLT model is summarized in Figure 6. The appropriate leadership style is found by cross referencing follower readiness, which varies from low to high, with one of four leadership styles. The four leadership styles represent combinations of task and relationship-oriented leader behaviors (S1 to S4). Leaders are encouraged to use a "telling style" for followers with low readiness. This style combines high task-oriented leader behaviors, such as providing instructions, with low relationship-oriented behaviors, such as close supervision (see Figure 6). As follower readiness increases, leaders are advised to gradually move from a telling, to a selling, to a participating, and, ultimately, to a delegating style. In the most recent description of this model, the four leadership styles depicted in Figure 6 are referred to as telling or directing (S,), persuading or coaching (S2), participating or supporting (S3), and delegating (S4).

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Figure 6 Situational Leadership Theory

From Transactional to Charismatic Leadership New perspectives of leadership theory have emerged in the past 15 years, various referred to as "charismatic," "heroic," "transformational," or "visionary" leadership. These competing but related perspectives have created confusion among researchers and practicing managers. Fortunately, Robert House and Boas Shamir have given us a practical, integrated theory. It is referred to as charismatic leadership. This section begins by highlighting the differences between transactional and charismatic leadership. We then discuss a model of the charismatic leadership process and its research and management implications. What Is the Difference between Transactional and Charismatic Leadership? Most of the models and theories previously discussed in this chapter represent transactional leadership. Transactional leadership focuses on the interpersonal transactions between managers and employees. Leaders are seen as engaging in behaviours that maintain in a quality interaction between themselves and followers. The two underlying characteristics of transactional leadership are that (1) leaders use contingent rewards to motivate employees and (2) leaders exert corrective action only when subordinates fail to obtain performance goals. In contrast, charismatic leadership emphasizes "symbolic leader behavior, visionary and inspirational messages, nonverbal communication, appeal to ideological values, intellectual stimulation of followers by the leader, display of confidence in self and followers, and leader expectations for follower self-sacrifice and for performance beyond the call of duty." Charismatic leadership can produce significant organizational change and results because it "transforms" employees to pursue organizational goals in lieu of self-interests. Consider the leadership style of William G "Gus" Pagonis, head of logistics at Sears, Roebuck & Co. Mr. Pagonis was a three-star Army general who served as chief of logistics for the US military during the Gulf War. Since he took over his job at Sears, Pagonis has cut logistics costs by $45 million a year—with very few layoffs—and has cut the amount of time it takes to deliver products from suppliers to stores by 50%:

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How Does Charismatic Leadership Transform Followers? Charismatic leaders transform followers by creating changes in their goals, values, needs, beliefs, and aspirations. They accomplish this transformation by appealing to followers' self-concepts—namely, their values and personal identity. Figure 7 presents a model of how charismatic leadership accomplishes this transformation process. Charismatic leaders first engage in three key sets of leader behavior. If done effectively, these behaviors positively affect followers’ self concepts. In turn, a positive self-concept propels employee motivation (motivational mechanisms) toward host of personal outcomes such as personal commitment to the leaders and vision, self-sacrificial behavior, organizational commitment, task meaningfulness and satisfaction, intrinsic motivation, and increased performance. Charismatic Leader Behavior: The first set of charismatic leader behaviors involves establishing a common vision of the future. A vision is "a realistic, credible, attractive future for your organization." According to Burt Nanus, a leadership expert, the "right" vision unleashes human potential because it serves as a beacon of hope and common purpose. It does this by attracting commitment, energizing workers, creating meaning in employees' lives, establishing a standard of excellence, promoting high ideals, and bridging the gap between an organization's present problems and its future goals and aspirations. In contrast, the "wrong" vision can be very damaging to an organization. **Consider what happened to Coastal Physician Group Inc. as it pursued the vision of its founder Dr. Steven Scott. Dr. Scott's vision was to create networks of physician practices and then sell the network services to health care providers: Today, his dream of a physician-led revolution has turned into a nightmare. Major clients and top executives have fled. Coastal is abandoning many of its businesses, selling clinics and trying to resuscitate its original activity, staffing hospitals Dr. Scott himself, a 48-year-old workaholic obstetrician turned entrepreneur, sits in his fenced-in two-story brick home here, cooling his heels and sipping iced tea. In May, his hand-picked board ousted him as chief executive officer and put him on "sabbatical." The CEO who made a practice of calling subordinates at home at night is now barred, by motion of the board, from speaking to Coastal's employees. He also can't enter its offices, even though he owns the building.... Current management describes him as an arrogant boss who ruined Coastal through a series of missteps and can't bear to let go. As you can see, Coastal Physician Group's vision produced disastrous results. This highlights the fact that charismatic leaders do more than simply establish a vision. They also must gain input from others in developing an effective implementation plan. For example, Johnson & Johnson obtained input about its vision and implementation plan by surveying all of its 80,000 employees. T The second set of leader behaviors involves two key components: 1. Charismatic leaders set high performance expectations and standards because they know

challenging, attainable goals lead to greater productivity. 2. Charismatic leaders need to publicly express confidence in the followers' ability to meet high

performance expectations. This is essential because employees are more likely to pursue difficult goals when they believe they can accomplish what is being asked of them.

The third and final set of leader behaviors involves being a role model. Through their actions, charismatic leaders model the desired values, traits, beliefs, and behaviors needed to realize the vision.

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Effects on Follower Self-Concepts: Charismatic leadership affects three aspects of a follower's self-concept: 1. It enhances follower motivation, achievement motivation, and goal pursuit. 2. It increases the extent to which followers identify with the leader's values, goals,

and aspirations and with the collective interests of all employees. 3. Follower self-esteem and self-efficacy are heightened by charismatic leader behavior. In contrast, followers' self-concepts are negatively affected by destructive charismatic leadership. Motivational Mechanisms: Charismatic leadership positively affects employee motivation. One way in which this occurs is by increasing the intrinsic value of an employee's effort and goals. Leaders do this by emphasizing the symbolic value of effort; that is, charismatic leaders convey the message that effort reflects important organizational values and collective interests. Followers come to learn that their level of effort represents a moral statement. For example, high effort represents commitment to the organization's vision and values, whereas low effort reflects a lack of commitment. Charismatic leadership also increases employees' effort expectancies by positively contributing to followers' self-esteem and self-efficacy. Leaders also increase the intrinsic value of goal accomplishment by explaining the organization's vision and goals in terms of the personal values they represent. This helps employees to personally connect with the organization's vision. Charismatic leaders further increase the meaningfulness of actions aimed toward goal accomplishment by showing how goals move the organization toward its positive vision, which then gives followers a sense of "growth and development," both of which are important contributors to a positive self-concept. Research and Managerial Implications The charismatic model of leadership presented was supported by an experiment in which 282 business students performed a simulated assembly task. Results revealed that charismatic leadership positively influenced students' quality and quantity goals and their self-efficacy, which, in turn, enhanced the quality and quantity of performance. A recent meta-analysis of 54 studies further indicated that charismatic leaders were viewed as more effective leaders by both supervisors and followers and had followers who exerted more effort and reported higher levels of job satisfaction than noncharismatic leaders. Other studies showed that followers trusted charismatic leaders more than noncharismatic ones, and charismatic leaders had higher project quality and budget/schedule performance ratings and were identified as more effective role models. Two additional studies demonstrated that both charismatic and transactional leadership were positively associated with a varitety of important employee outcomes. Finally, as study of 31 presidential performance. These results underscore four important managerial implications. First, the bet leaders are not just charismatic, they are both transactional and charismatic. Leaders should attempt these two types of leadership while avoiding a “laissez-faire” or “wait-and-see” style. Laissez-faire leadership is the most ineffective leadership style. Second, charismatic leadership is not applicable in all organizational situations. According to a team of experts, charismatic leadership is most likely to be effective when 1. The situation offers opportunities for "moral" involvement. 2. Performance goals cannot be easily established and measured. 3. Extrinsic rewards cannot be clearly linked to individual performance. 4. There are few situational cues or constraints to guide behavior. 5. Exceptional effort, behavior, sacrifices, and performance are required of both leaders and

followers. Third, employees at any level in an organization can be trained to be more transactional and charismatic. This reinforces the organizational value of developing and rolling out a combination of transactional and charismatic leadership training for all employees. Fourth, charismatic leaders can be ethical or unethical. Whereas ethical charismatic leaders enable employees to enhance their self-concepts, unethical ones select or produce obedient, dependent, and compliant followers. Top

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management can create and maintain ethical charismatic leadership by 1. Creating and enforcing a clearly stated code of ethics. 2. Recruiting, selecting, and promoting people with high morals and standards. 3. Developing performance expectations around the treatment of employees—these expectations

can then be assessed in the performance appraisal process. 4. Training employees to value diversity. 5. Identifying, rewarding, and publicly praising employees who exemplify high moral conduct. Additional Perspectives on Leadership This section examines four additional approaches to leadership: leader-member exchange theory, substitutes for leadership, servant leadership, and superleadership. We spend more time discussing leader-member exchange theory and substitutes for leadership because they have been more thoroughly investigated. Graen’s Leader-Member Exchange (LMX) Model of Leadership George Graen, an industrial psychologist, believes popular theories of leadership are based on an incorrect assumption. Theories such as the Leadership Grid® and Fiedler's contingency model assume that leader behavior is characterized by a stable or average leadership style. In other words, these models assume a leader treats all subordinates in about the same way. This traditional approach to leadership is shown in the left side of Figure 16-8. In this case, the leader (designated by the circled L) is thought to exhibit a similar pattern of behavior toward all employees (El to E5). In contrast, Graen contends that leaders develop unique one-to-one relationships with each of the people reporting to them. Behavioral scientists call this sort of relationship a vertical dyad. The forming of vertical dyads is said to be a naturally occurring process, resulting from the leader's attempt to delegate and assign work roles. As a result of this process, Graen predicts that one of two distinct types of leader-member exchange relationships will evolve. One type of leader-member exchange is called the Internal/in-group exchange. In this relationship, leaders and followers develop a partnership characterized by reciprocal influence, mutual trust, respect and liking, and a sense of common fates. Figure 8 shows that E1, and E5 are members of the leader's in-group. In the second type of exchange, referred to as an external/out-group exchange, leaders are characterized as overseers who fail to create a sense of mutual trust, respect, or common fate. E2, E3, and E4 are members of the out-group on the right side of Figure 8.

Figure 8 A Role-Making Model of Leadership

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Research Findings: If Graen's model is correct, there should be a significant relationship between the type of leader-member exchange and job-related outcomes. Research supports this prediction. For example, in-group members were found to have higher organizational commitment, job satisfaction, and job performance than did employees in the out-group.66 Positive leader-member exchange also was associated with greater levels of perceived environmental control, supervisory fairness, and satisfaction with leadership.The type of leader-member exchange was found to predict not only turnover among nurses and computer analysts, but also career outcomes, such as promotability, salary level, and receipt of bonuses over a seven-year period. Finally, a recent study sought to determine the demographic and organizational characteristics that foster the quality of an LMX. Results revealed that LMX was of lower quality when leaders and followers had different genders. The quality of an LMX also was negatively associated with the number of employees reporting to a manager and the work load. Managerial Implications: Graen's model underscores the importance of training managers to improve leader-member relations. Ideally, this should enhance the job satisfaction and performance of employees and also reduce turnover. A large US government installation in the Midwest conducted such a training program. Results indicated a 19% increase on an objective measure of productivity. This improvement resulted in an estimated annual cost savings of more than $5 million. In addition to training, OB researcher Robert Vecchio offers the following tips to both followers and leaders for improving the quality of leader-member exchanges: 1. New employees should offer their loyalty, support, and cooperativeness to their manager. 2. If you are an out-group member, either accept the situation, try to become an in-group

member by being cooperative and loyal, or quit. 3. Managers should consciously try to expand their in-groups. 4. Managers need to give employees ample opportunity to prove themselves. Substitutes for Leadership Virtually all leadership theories assume that some sort of formal leadership is necessary, whatever the circumstances. But this basic assumption is questioned by this model of leadership. Specifically, some OB scholars propose that there that can substitute for, neutralize, or enhance the effects of leadership. These situational variables are referred to as substitutes for leadership. Substitutes for leadership can this increase or diminish a leader’s ability to influence the work group. For example, leaders behavior that imitates structure would tend to be resisted by independent-minded employees with high ability and vast experience. Consequently, such employees would be guided more by their own initiate than by managerial directives. Kerr and Jermier's Substitutes for Leadership Model According to Steven Kerr and John Jermier, the OB researchers who developed this model, the key to improving leadership effectiveness is to identify the situational characteristics that can substitute for, neutralize, or improve the impact of a leader's behavior. Table 9 lists the various substitutes for leadership. Characteristics of the subordinate, the task, and the organization can act as substitutes for traditional hierarchical leadership. Further, different characteristics are predicted to negate different types of leader behavior. For example, tasks that provide feedback concerning accomplishment, such as taking a test, tend to negate task-oriented but not relationship-oriented leader behavior (see Table 9). Al-though the list in Table 9 is not all-inclusive, it shows that there are more substitutes for task-oriented leadership than for relationship-oriented leadership. The key implication is that managers should be attentive to the substitutes listed in Table 9 because they directly influence employee attitudes and performance. Managers can positively influence the substitutes through employee selection, job design, work group assignments, and the design of organizational processes and systems.

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Table 9: Substitutes for Leadership

CHARACTERISTIC

RELATIONSHIP-ORIENTED OR CONSIDERATE LEADER BEHAVIOR IS UNNECESSARY

TASK ORIENTED OR INITIATING STRUCTURE LEADER BEHAVIOR IS UNNECESSARY

OF THE SUBORDINATE 1. Ability, experience, training, knowledge X

2. Need for independence X X

3. "Professional" orientation X X

4. Indifference toward organizational rewards X X

OF THE TASK 5. Unambiguous and routine X

6. Methodologically invariant X

7. Provides its own feedback concerning accomplishment

X

8. Intrinsically satisfying X

OF THE ORGANIZATION 9. Formalization (explicit plans, goals, and

f X

responsibility) 10. Inflexibility (rigid, unbending rules and

d ) X

11. Highly specified and active advisory and staff f ti

X

12. Closely knit, cohesive work groups X X 13. Organizational rewards not within the l d ' t l

X X 14. Spatial distance between superior and

b di t X X

Servant Leadership Servant-leadership is more a philosophy of managing than a testable theory. The term servant-leadership was coined by Robert Greenleaf in 1970. Greenleaf believes that great leaders act as servants, putting the needs of others, including employees, customers, and community, as their first priority. Servant-leadership focuses on increased service to others rather than to oneself. Servant-leadership is not a quick-fix approach to leadership. Rather, it is a long-term, transformational approach to life and work. Table 10 presents 10 characteristics possessed by servant-leaders. One can hardly go wrong by trying to adopt these characteristics. Super Leadership A superleader is someone who leads others to lead themselves. Superleadership is equally relevant within teams as well as any general leadership situation. Superleaders empower followers by acting as a teacher and coach rather than as a dictator and autocrat. The need for this form of leadership is underscored by a recent survey of 1,046 Americans. Results demonstrated that only 38% of the respondents ever had an effective coach or mentor. Productive thinking is the cornerstone of superleadership. Specifically, managers are encouraged to teach followers how to engage in productive thinking. This is expected to increase employees' feelings of personal control and intrinsic motivation. Superleadership has the potential to free up a manager's time because employees are encouraged to manage themselves. Future research is needed to test the validity of recommendations derived from this new approach to leadership.

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Table 10 Characteristics of the Servant leaders

SERVANT LEADERSHIP CHARACTERISTICS DESCRIPTION

1. Listening Servant-leaders focus on listening to identify and clarify the needs and desires of a group.

2. Empathy Servant-leaders try to empathize with others' feelings and emotions. An individual's good intentions are assumed even when he or she

3. Healing Servant-leaders strive to make themselves and others whole in the face of failure or suffering.

4. Awareness Servant-leaders are very self-aware of their strengths and limitations.

5. Persuasion Servant-leaders rely more on persuasion than positional authority when making decisions and trying to influence others.

6. Conceptualization

Servant leaders take the time and effort to develop broader based conceptual thinking. Servant-leaders seek an appropriate balance between a short-term, day-to-day focus and a long-term, conceptual orientation.

7. Foresight Servant-leaders have the ability to foresee future outcomes associated with a current course of actor or situation.

8. Stewardship Servant-leaders assume that they are stewards of the people and resources they manage.

9. Commitment to the growth of people

Servant-leaders are committed to people beyond their immediate work role. They commit to fostering an environment that encourages

10. Building community Servant-leaders strive to create a sense of community both within and outside the work organization.

Summary of Key Concepts Leadership's definition and difference between leading versus managing. Leadership is defined as a social influence process in which the leader tries to obtain the voluntary participation of employees in an effort to reach organizational objectives. Leadership entails more than having authority and power. Although leadership and management overlap, each entails a unique set of activities or functions. Managers typically perform functions associated with planning, investigating, organizing, and control, and leaders deal with the interpersonal aspects of a manager's job. Table 16-1 summarizes the differences between leading and managing.

Review of trait theory research, and discussing the idea of one best style of leadership, using the Ohio State studies and the Leadership Grid9 as points of reference.

Historical leadership research did not support the notion that effective leaders possessed unique traits from followers. However, teams of researchers reanalyzed this historical data with modern-day statistical procedures. Results revealed that individuals tend to be perceived as leaders when they possess one or more of the following traits: intelligence, dominance, and masculinity. A recent study further demonstrated that employees value credible leaders. Credible leaders are honest, forward-looking, inspiring, and competent. Research also examined the relationship between gender and leadership. Results demonstrated that (a) men and women differed in the type of leadership roles they assume, (b) leadership styles varied by gender, and (c) gender differences in ratings of leadership effectiveness were associated with the percentage of male leaders and male subordinates. The Ohio State studies revealed that there were two key independent dimensions of leadership behavior: consideration and initiating structure. Authors of the Leadership Grid® proposed that leaders should adopt a style that demonstrates high concern for production and people. Research did not support the premise that there is one best style of leadership.

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Fiedler's contingency model

According to Fiedler's contingency model, leadership style interacts with situational control. Fiedler believes leader effectiveness depends on an appropriate match between leadership style and situational control. Leaders are either task motivated or relationship motivated. Situation control is composed of leader-member relations, task structure, and position power. Task-motivated leaders are effective under situations of both high and low control. Relationship- motivated leaders are more effective when they have moderate situational control.

House's path-goal theory and Hersey and Blanchard's situational leadership theory.

According to path-goal theory, leaders alternately can exhibit directive, supportive, participative, or achievement-oriented styles of leadership. The effectiveness of these styles depends on various employee characteristics and environmental factors. Path-goal theory has received limited support from research. There are two important managerial Implications: (a) leaders possess and use more than one style of leadership, and (b) managers are advised to modify their leadership style to fit a small subset of task and employee characteristics. According to situational leadership theory (SLT), effective leader behavior depends on the readiness level of a leader's followers. As follower readiness increases, leaders are advised to gradually move from a telling to a selling to a participating and, finally, to a delegating style. Research does not support

Difference between transactional and charismatic leadership.

There is an important difference between transactional and charismatic leadership. Transactional leaders focus on the interpersonal transactions between managers and employees. Charismatic leaders motivate employees to pursue organizational goals above their own self-interests. Both forms of leadership are important for organizational success.

How charismatic leadership transforms followers.

Charismatic leaders transform followers by creating changes in their goals, values, needs, beliefs, and aspirations. Leaders accomplish this by first engaging in three key sets of leader behavior. These leader behaviors, in turn, positively affect followers' self-concepts. A positive self-concept then unleashes employee motivation toward achieving a host of preferred outcomes.

Managerial implications of charismatic leadership.

There are four managerial implications: (a) The best leaders are both transactional and charismatic. (b) Charismatic leadership is not applicable in all organizational situations, (c) Employees at any level in an organization can be trained to be more transactional and charismatic, (d) Top management needs to promote and reinforce ethical charismatic leadership because charismatic leaders can be ethical or unethical.

Graen's leader-member exchange model of leadership.

George Graen believes that leaders develop unique one-to-one relationships, referred to as vertical dyads, with each employee. These leader-member exchanges qualify as either in-group or out-group relationships. Research supports this model of leadership.

Substitutes for leadership

There are 14 substitutes for leadership (see Table 9) that can substitute for, neutralize, or enhance the effects of leadership. These substitutes contain characteristics of the subordinates, the task, and the organization. Research shows that substitutes directly influence employee attitudes and performance.

Servant-leadership and superleadership. Servant-leadership is more a philosophy than a testable theory. It is based on the premise that great leaders act as servants, putting the needs of others, including employees, customers, and community, as their first priority. A superleader is someone who leads others to lead themselves. Superleaders empower followers by acting as a teacher and coach rather than as a dictator and autocrat.

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THREE KNOWN MODES OF TRANSFORMATIONAL LEADERSHIP AND ONE UNKNOWN

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A b s t r a c t

This paper develops a macro-model of organizational leadership based on the role of the external environment in shaping the type of leadership required to manage an organization. We propose that the traditional distinctions between the classic modes of leadership, namely the visionary, charismatic, transactional and transformational modes of leadership, are hard to reconcile with a classification of the possible environmental types of the future. We advance the idea that the transformational mode is not an option contingent on circumstances like the former three, but is a requisite in all practical instances. We thus develop an environmental typology with matching leadership styles typology. However, our results are surprising in that our resulting leadership classification contains only three known modes instead of the customary four. We thus offer an interesting avenue for consideration by future leadership practitioners and researchers.

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It is intriguing that the technologically oriented passing century has brought an increasing interest in leadership theory and practice. A plethora of recent papers examine the influence of leadership style on performance under various conditions (e.g., Jung & Avolio, 1999). Some even examine peripheral elements loosely linked to leadership styles. For instance, a recent paper by Avolio, Howell and Sosik (1999) investigates the moderating influence of humor on leadership style effects. Curiously, the more technological the times have become, the greater the interest in leadership theory and practice.

There have been several traditional categories of leadership. Charismatic leadership (Conger

& Kanungo, 1988; Gardner & Avolio, 1998) is a type that has been hailed from time immemorial. Visionary or strategic leadership has been hailed by historians and rediscovered by management theorists (Finkelstein & Hambrick, 1996; Westley & Mintzberg, 1989). According to Nanus (1992), selecting and articulating the right vision, this powerful idea, is the toughest task and the truest test of great leadership. Strategic leadership refers to the leader’s ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate changes that will create a viable future for the organization (Ireland & Hitt, 1999: 43). Implicit in the utility and agency theories derived from economics is the notion of motivation through a quid pro quo. From this latter perspective has been derived the notion of transactional leadership (Hater & Bass, 1988; Howell & Avolio, 1993). Transactional leadership is characterized by an exchange relationship between leader and followers. In such an exchange relationship, followers are rewarded for good performance and punished when their performance falls short of expectations. Recently, American leadership theories have also introduced a new type, transformational leadership (Bass, 1990, 1998; Tichy & Devanna, 1986). Transformational leadership is usually seen as one of many types (Kuhnert & Lewis, 1987; Pfeffer, 1977; Singer & Singer, 1990). However, this paper will depart from established practice and will offer the view that the upcoming challenges of the next century will necessitate a greater focus on and an increased use of transformational leadership. Our argument is that, over time, transformational leadership will have to subsume all traditionally promoted forms of leadership. Increased international competition and technological change have served to break stable bureaucracies, replacing them with more ad hoc arrangements such as contracting and alliances (Pearce, Branyiczki, & Bigley, 2000). As change becomes the constant of today’s corporate life (Porter, 1990), organizations are facing more turbulent environments, thereby calling for new leadership challenges. As Griesinger (1990: 496) put it,

“…the accelerated pace of globalization and technological change requires management systems and organizational arrangements that are adroit in processing equivocality and sophisticated in cultivating cooperation across organizational and cultural boundaries." Such changes in the external environment call for new challenges in organizational

structures, management practices and leadership. Extant organizational theories have not fully plumbed the depth of the pits and obstacles to be bridged over. Nor do the existing disjointed leadership models, such as our separate conceptions of charismatic leadership (e.g., Gardner & Avolio, 1998), transformational leadership (e.g., Bass, 1998) and visionary or strategic leadership (e.g., Finkelstein & Hambrick, 1996), provide enduring guidance on how to manage future structure forms.

Only a few researchers have examined the impact of macro-organizational factors and characteristics on leadership behaviors (Hooijberg & Choi, 1998). Worse still, research on organizational leadership has remained rather silent on the impact of the external environment on the adoption of a particular leadership style. Yet in today’s fast-moving environment, firms are preoccupied with constantly revamping themselves. This is a disquieting state of affairs as we cross into a new century whose make up is bound to be more technological and more networked, hence more challenging, than the recent decades.

The purpose of the present contribution is to provide a conceptual framework that helps understand the leadership challenges of the twenty-first century required by constant changes in firms’ external environments. By so doing, this paper intends to explore the impact of a firm’s external environment on transformational leadership patterns. We thus depart from established practice in leadership studies. Instead of investigating such micro-levels of leadership as the small-group, dyadic

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or individual levels, we broaden our focus to the organizational level or its primary subsystems (Shrivastava & Nachman, 1989). We focus on transformational leadership at the macro-organizational level because effective transformational leaders are becoming increasingly concerned with moving the entire organization in new directions, not just its most amenable subparts. We structure our argument in four parts. The first part discusses the major changes in the external environment of today’s organizations. The second part analyzes the concept of transformational leadership. The third part presents our model of the relationship between the external environment and different patterns of transformational leadership. Finally, the fourth and last part discusses avenues for research and practice.

CHALLENGES FACING ORGANIZATIONS More than two decades ago, Osborn and Hunt (1975) noted that leaders adapt to the macro-organizational characteristics of the organizations within which they work. Their study, however, focused primarily on such macro-characteristics of the organization as its size, technology and formal structure. According to these authors, the internal macro-characteristics they cite determine the discretionary behavior of the leader. Unfortunately, they did not consider the impact of variables in the external environment. Yet, if an organization operates in an ever-changing environment, its leaders may have a tendency to develop flexibility to adjust to the changes in the external environment. Changes in the external environment result in changes within the organization. To add to the contribution of those few researchers who, like Hooijberg and Choi (1998), have examined the impact of macro-organizational characteristics on leadership behaviors, we have to examine the main change undercurrents that are sweeping industrialized economies. The New Economy that is emerging as the way of the 21st century represents an accentuation of the characteristics of the ending decades of the 20th. It is characterized by accelerated change, both technological and social. On the face of it, the extent and variety of change is overwhelming. Considerable change is taking place in technology, particularly in information technology (IT) and its derivatives. Technological changes derived from progress in IT, such as the Internet and corporate intranets, have forever changed the way we work – and even the way we live. In addition, considerable change is occurring in the workforce as a result of differential ethnic demographics and worker movements – whether solicited or unwelcome. These social changes are compounded by rising public expectations concerning public ethics and corporate social responsibility. These changes are shaping not only the type of organizations but also the management of these organizations. As these changes become more pervasive, managers must find new ways of managing their organizations. Technological and social change of this magnitude affects not only the organizational structure but also calls for either devising new sorts of leadership or, at least, matching the existing leadership modes to the principal categories of environmental challenge. The resulting syndromes may be many in number. Nicholson (1998) enumerates seven deadly syndromes of management. However, in order to address the issue theoretically, it would be helpful to reduce the categories of environmental change to two main clusters so as to obtain a 2x2 typology of environmental conditions of the usual manageable kind. Given this operational requirement, this paper clusters the sources of environmental change into two broad categories that could yield a contextual environmental typology. The first major dimension of change that affects organizational governance is an external one: it is the rate of technological change and its resulting globalization. From the standpoint of governance and requisite leadership, it very much matters to organization whether they are confronting a rather stable or a very dynamic environment (Emery & Trist, 1973; D’Aveni, 1994; Porter, 1990). A stable environment is characterized by fewer changes, whereas in a dynamic environment, several parameters are involved and change is the norm. The second dimension to consider embodies the cluster of internal response factors that are affecting the organizations that aim to survive and remain functional into the next century. One element of the New Economy, and a consequence of the rise of IT to dominance of the workplace, is the increasing number of knowledge workers; this is resulting in a democratization of the workplace, and rising

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expectations of greater workplace fairness and corporate social responsibility (Ackoff, 1981; Drucker, 1999). Leading such workers may require new approaches to leadership. One away to translate this cluster of internal response variable is to adopt the classic characterization of organizations by Burns and Stalker (1961) into mechanistic or organic types. A mechanistic structure is more rigid, whereas an organic structure is more flexible. Flexibility ensures that the organization has the capacity to proact or respond quickly to changing competitive conditions and thus build or maintain a competitive advantage (Hill, 2000). These two variables, namely the rate of environmental change (of the external environment) and the degree of response of the organization to the knowledge management challenge (in other words, its internal environment) constitute the dimensions of the typology we present in Figure 1 as the context for the analysis of leadership into four functional types. Before we present our typology, we discuss the concept of transformational leadership.

TRANSFORMATIONAL LEADERSHIP Transformational leadership (Avolio & Bass, 1988, Bass, 1998; Bass & Avolio, 1994; Bass, Avolio, & Goodheim, 1987; Bennis & Nanus, 1985; Burns, 1978; Pawar & Eastman, 1997; Tichy & Devanna, 1986; Yukl, 1989) refers to the sort of leadership in which leaders possess charisma and provide intellectual stimulation, individualized consideration and inspirational motivation to followers. “Transformational leaders create a dynamic organizational vision that often necessitates a metamorphosis in cultural values to reflect greater innovation” (Pawar & Eastman, 1997: 83). Transformational leadership also seeks a bonding between individual and collective interests allowing subordinates to work for transcendental goals (Bass, 1985, 1998; Pawar & Eastman, 1997). It is important to note that the literature ascribes to transformational leadership four important characteristics:

Charisma. Charisma involves not only the possession of personal characteristics but also the capacity to envision a future for the organization. According to Nadler and Tushman (1990: 82):

Envisioning…involves the creation of a picture of the future, of a desired future state with which people can identify and which can generate excitement. By creating vision, the leader provides a vehicle for people to develop commitment, a common goal around which people can rally, and a way for people to feel successful.

This characteristic brings to transformational leadership a measure of similarity to charismatic leadership. However, charismatic leadership can be wasteful of organizational energies in that it implies the careful cultivation of traits and characteristics for followers to view in their leader (Gardner & Avolio, 1998). In contrast, transformational leadership entails behaviors intended to move the organization in a new and more effective direction. Intellectual stimulation. A citation from Bass (1990: 21) simply makes the point that:

Intellectually stimulating leaders are willing and able to show their employees new ways of looking at old problems, to teach them to see difficulties as problems to be solved, and to emphasize rational solutions.

Individualized consideration. Individualized consideration implies that the leader treats followers with respect and dignity and serves as a mentor. “The leader psychologically helps people act or perform in the face of challenging goals” (Nadler & Tushman, 1990: 83).

Inspirational motivation. Inspirational motivation requires that the leader energize members of the organization. Transformational leaders communicate clearly the importance of the company’s mission and objectives to employees. Such clear communication allows fellow employees to strive, and often reach, beyond their prescribed duties. In sum, transformational leadership is a shared process (Burns, 1978); as such, it seems to be the way of the future because of the ever-increasing importance claimed by and ceded to teamwork. As the leader attempts to change the organization, he/she must have the support of followers. Failure to receive such support may undermine the success of the newly privatized firm. Bass, Waldman, Avolio and Bebb (1987) found that transformational leaders attract strong feelings of identity,

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excitement and expectations, by focusing on ideas and creating a vision for their followers.

SEARCHING FOR THE MODES OF TRANSFORMATIONAL LEADERSHIP Recalling the looming challenges discussed above, what leadership modes are most adequate to meet them? Research on leadership (Westley & Mintzberg, 1989) has discussed the concept of visionary or strategic leadership. Actually, purely visionary leadership is a key trait of leadership, one of its quintessential attributes. Our view is that a modicum of visionary leadership is a sine qua non feature of any leadership style, as opposed to being yet another leadership mode such as charismatic leadership or transformational leadership. Throughout the literature, possessing vision has been identified as a key trait of successful leaders, be they charismatic or transformational. A transformational leader inspires change in the entire organization. He/she creates a vision for both managers and employees within the organization. The transformational leader will have to develop a new organizational culture, new compensation and performance appraisal systems, as well as new policies and strategies in hiring and motivating employees. However, the external environment in which the organization operates plays a role in rendering executive actions more or less effective (Duncan, 1972; Porter, 1990). Empirical research (Hater & Bass, 1988; Howell, & Avolio, 1993; Koh, Steers, & Terborg, 1995) found a positive relationship between transformational leadership and organizational performance. In an empirical study on a sample of 78 managers, Howell and Avolio (1993) found that transformational leadership directly and positively predicted unit-level performance. In a study conducted in a different cultural setting (Singapore), Koh, Steers, & Terborg (1995) reported a high level performance of high-school students whose institutions were managed by charismatic leaders. Hater & Bass (1988) found that managers identified independently as top performers were rated higher on transformational leadership than the randomly chosen group of ordinary managers. Transformational leaders’ organizations do better financially (Bass, 1990). Transformational leaders are effective for several reasons. They are able both to unite followers and change followers’ goals and beliefs (Kuhnhert & Lewis, 1987). For Conger & Kanungo (1988), transformational leaders portray vivid representations of a future vision for followers. Because such leaders are able to formulate a clear vision, they are likely to motivate employees in sharing that vision. Transformational leaders motivate subordinates to perform beyond expectations (Bass, 1985; Singer & Singer, 1990). According to Pawar & Eastman (1997), the effectiveness of a transformational leader is the result of three factors. These are: the organization’s relative position on the continuum of organizational receptivity (openness to change), the degree of correspondence between the transformational process required by the organization’s position and the actual transformational leadership process, and the transformational leader’s capabilities for undertaking the appropriate transformational process. Consequently, although the literature appears silent on this point, the pure leadership modes generally envisioned may become increasingly dysfunctional in the future. To sustain a viable leadership style, it has to contain elements of transformational leadership. We are thus advancing the idea that the only viable forms of leadership in the 21st century will be those with a strong transformational content. The typology proposed in Figure 1 introduces four hybrid types of transformational leadership, each a composite of transformational leadership with one of the other traditional “pure” modes. I. Stable-Mechanistic Environment. This represents the case of a stable external environment

with the firm having a mechanistic structure. In such a situation, followers will establish an exchange relationship with the leader. Because followers do not see any threats in the external environment, their primary motivator to follow a leader would be the trading or the mere promise of tangible rewards according to Agency Theory. The most effective matching leadership style will be the transactional-transformational hybrid.

II. Stable-Organic Environment. An emotional bond between leader and followers characterizes

this leadership type likely to be most effective in the case of a stable external environment but an organic internal environment. Because followers believe that the leader has extraordinary

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qualities, they will tend to comply with his or her decisions. The external environment does not pose any particularly threat because only few parameters are subject to frequent change. We propose that the most appropriate mode of leadership would be the charismatic-transformational composite.

III. Dynamic-Mechanistic Environment. In the unusual case of a dynamic external

environment while the firm’s internal environment still remains mechanistic, unusual perspicacity and vision are needed for the leader to be able to steer his/her cumbersome and possibly clumsy ship in the midst of troubled waters. As advocated by Pawar and Eastman (1997), visionary-transformational leadership is needed to create a discomfort with the current state and align followers with a vision capable of pointing the way and transforming the organization to meet looming challenges.Dynamic-Organic Environment. This is the situation of the future, whereby the organization operates in a dynamic environment and its internal environment is characterized by a matching flexible structure. The emerging literature on new organizational forms (e.g., Ross, 1994) tries to capture its essence; but it is still novel for the leadership literature, and no fully appropriate characterization readily comes to mind. And yet this is the case most worthy of analysis at the dawn of this upcoming technological century. For want of its still elusive name, we temporarily describe it in Figure 1 as the “pure transformational” type.

For two reasons, Type IV is the most interesting mode of leadership. First, it is the way of the future as more and more firms are likely to be structured organically according to new organizational forms (Bartlett & Ghoshal, 1993; Brown & Eisenhardt, 1998; Carley & Lee, 1998; Dijksterhuis , Van den Bosch, & Volberda, 1999; Ross, 1994). The flexible internal environment allows employee empowerment and self-managed teams. In such an environment, the leader may set the vision along with followers, whereas procedures and decisions concerning work requirements are left to the discretion of employees – thus contributing actively to the democratization of the workplace at the same time as having meaningful leadership. Secondly, our conceptual investigation of the appropriateness of leadership modes to environmental conditions has led us to discover an unknown fourth mode of leadership that the literature has still not properly explored. While temporarily calling this “missing mode” pure transformational leadership, we offer it as a subject for further exploration by the leadership research community. The pure transformational type of leadership has the appropriate managerial mind-set that allows the creation of strategic flexibility and develops human capital to have the skill sets appropriate to respond to a dynamic environment (Hill, 2000). CONCLUDING REMARKS: IMPLICATIONS FOR RESEARCH AND PRACTICE Implications for Research Transformational leadership has a falling dominoes effect (Bass et al., 1987). Bass et al. (1987) found that the degree of transformational leadership behavior observed at a superior level was also seen at the next lower level of management. Therefore, an effective strategy of instilling transformational leadership in an organization would be to provide transformational leadership training to top-level managers who will, in turn, serve as role models for their lower-level subordinates. Future researchers should explore the extent to which such diffusion of transformational leadership skills is possible in an organization. To what extent do factors such as political constraints, economic conditions, and social influences limit the effectiveness of the transformational leader? Pfeffer (1977) suggests that organizational effectiveness depends on factors beyond the leader’s control such as economic conditions, market conditions, government policies and technological change. Gibbons (1992) considered environmental complexity and scarcity as external factors influencing the form of the required transformational leadership. However, even though leaders cannot directly alter such factors, they can take actions to reduce constraints, expand choices and make the situation more favorable (Yukl, 1989). Implications for Practice

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According to Bass (1998), transformational leadership can be taught and learned. The first step in training managers to lead the transition to private enterprise should start by identifying the appropriate skills and abilities. Transformational leaders can be trained in areas such as critical evaluation and problem detection, envisioning, communication skills for conveying a vision, impression management, and how to empower employees (Bass, 1998). A transformational leader should be able to formulate a vision that is both clear and appealing to her or his followers. In addition to formulating the vision, the transformational leader should articulate a strategy for bringing that vision to life. To the extent that a transformational leader is inspirational and sets the guidelines for reaching organizational goals and objectives, he/she can dramatically improve organizational effectiveness.

However, the process of change and development regarding the leader is generally a long-term effort that requires continual updating, feedback and modification (Bass, 1998). As Bass (1998: 80) points out: “Where it is in short supply, transformational leadership should be encouraged, for it can make a big difference in the organization’s performance.” As Senge (1990: 1) put it, “in an increasingly dynamic, interdependent, and unpredictable world, it is simply no longer possible for anyone to figure it all out at the top. The old model, ‘the top thinks and the local acts,’ must now give way to integrating thinking and acting at all levels.” REFERENCES

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Avolio, B. J., Howell, J. M., & Sosik, J. J. 1999. A funny thing happened on the way to the bottom line: Humor as a moderator of leadership effects. Academy of Management Journal, 42 (2): 219-227.

Bartlett, C. A., & Ghoshal, S. 1993. Beyond the M-form: Toward a managerial theory of the firm. Strategic Management Journal, 14: 23-46.

Bass, B. M. 1985. Leadership and performance beyond expectation. New York: Free Press.

Bass, B. M. 1990. From transactional to transformational leadership: Learning to share the vision. Organizational Dynamics, (Winter): 19-31.

Bass, B. M. 1998. Transformational leadership: Industry, military, and educational impact. Mahwah, NJ: Lawrence Erlbaum and Associates.

Bass, B. M., & Avolio, B. J. 1994. Improving organizational effectiveness through transformational leadership. Thousand Oaks, CA: Sage.

Bass, B. M., Avolio, B. J., & Goodheim, L. 1987. Biography and the assessment of transformational leadership at the world-class level. Journal of Management, 13: 7-19.

Bass, B. M., Waldman, D. A., Avolio, B. J., & Bebb, M. 1987. Transformational leadership and the falling dominoes effect. Group & Organization Studies, 12: 73-87.

Bennis, W. G., & Nanus, B. 1985. Leaders: The strategies for taking charge. New York: Harper & Row.

Brown, S. L., & Eisenhardt, K. M. 1998. Competing on the edge: Strategy as structured chaos. Boston: HBS Press.

Burns, J. M. 1978. Leadership. New York: Harper & Row.

Burns, T., & Stalker, G. M. 1961. The management of innovation. London:

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Tavistock.

Carley, K. M., & Lee, J-S. 1998. Dynamic organizations: organizational adaptation in a changing environment. In J.A..C. Baum (Ed.), Advances in Strategic Management, 15: 269-297. Stamford, CT: Jai Press.

Conger, J. A., & Kanungo, R. N. 1988. Behavioral dimensions of charismatic leadership. In J. A. Conger & R. N. Kanungo (Eds.), Charismatic leadership: The elusive factor in organizational effectiveness. San Francisco: Jossey-Bass.

D’Aveni, R. A.. (with the part. of R. Gunther). 1994. Hypercompetition. New York: Free Press.

Dijksterhuis, M. S., Van den Bosch, F. A. J., & Volberda, H. W. 1999. Where do new organizational forms come from? Management logics as a source of coevolution. Organization Science, 10 (5): 569-582.

Drucker, P. F. 1999. Management challenges for the 21st century. New York: HarperBusiness.

Duncan, R. B. 1972. Characteristics of organizational environments and perceived environmental uncertainty. Administrative Science Quarterly, 17: 313-327.

Emery, F. E., & Trist, E. L. 1973. Towards a social ecology. New York: Plenum.

Finkelstein, S., & Hambrick, D. 1996. Strategic leadership: Top executives and their effects on Organizations. Minneapolis-St. Paul, MN: West Publ.

Gardner, W. L., & Avolio, B. J. 1998. The charismatic relationship: A dramaturgical perspective. Academy of Management Review, 23: 32-58.

Gibbons, P. T. 1992. Impact of organizational evolution on leadership roles and behaviors. Human Relations, 45: 1-18.

Griesinger, D. W. 1990. The human side of economic organization. Academy of Management Review, 15: 478-499.

Hater, J. J., & Bass, B. M. 1988. Superiors’ and subordinates’ evaluation of transformational and transactional leadership. Journal of Applied Psychology, 73: 695-702.

Hill, M. A. 2000. The new frontier: Transformation of management for the new millennium. Organizational Dynamics, (Winter): 7-17.

Hooijberg, R., & Choi, J. 1998. The impact of organizational characteristics on leadership effectiveness models: An examination of leadership in private and public sector organizations. Academy of Management Proceedings: B1-B8.

Howell, J. M., & Avolio, B. J. 1993. Transformational leadership, transactional leadership, locus of control and support for innovation: Key predictors of consolidated-business unit performance. Journal of Applied Psychology, 78: 891-902.

Ireland D. R., & Hitt, H. A. 1999. Achieving and maintaining strategic competitiveness in the 21st century: The role of strategic leadership. Academy of Management Executive, 13: 43-57.

Jung, D. I., & Avolio, B. J. 1999. Effects of leadership style and followers’ cultural orientation on performance in group and individual task conditions. Academy of Management Journal, 42 (2): 208-218.

Koh, W. L., Steers, & Terborg, J. R. 1995. The effects of transformational leadership on teacher attitudes and student performance in Singapore. Journal of Organizational Behavior, 16: 319-

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333.

Kuhnhert, K. W., & Lewis, P. 1987. Transactional and transformational leadership: A constructive/developmental analysis. Academy of Management Review, 12: 640-657.

Mintzberg, H. 1998. Covert leadership: Notes on managing professionals. Harvard Business Review (November-December): 140-147.

Nadler, D. A., & Tushman, M. L. 1989. Beyond the charismatic leader: Leadership and organizational change. California Management Review, 32: 77-97.

Nanus, B. 1992. Visionary leadership. San Francisco: Jossey-Bass Publishers.

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Pawar, B. S., & Eastman, K. K. 1997. The nature and implications of contextual influences on transformational leadership: A conceptual examination. Academy of Management Review, 22: 80-109.

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Shrivastava, P., & Nachman, S. A. 1989. Strategic leadership patterns. Strategic Management Journal, 10: 51-66.

Singer, M. S., & Singer, A. E. 1990. Situational constraints on transactional versus transformational leadership behavior, subordinates’ leadership preference, and satisfaction. Journal of Social Psychology, 130: 385-396.

Tichy, N. M., & Devanna, M. A.. 1986. The transformational leader. New York: Wiley.

Waldman, D.A., & Yammarino, F. J. 1999. CEO charismatic leadership: Levels-of management and levels-of-analysis effects. Academy of Management Review, 24: 266-285.

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(Additional Readings on Leadership) Leaders have a key role to play in developing effective organizations. They set people in the right direction, gain commitment to achieving the organization's mission and motivate them to achieve their goals. As John Kotter (33) has written: The direction-setting aspect of leadership does not produce plans; it creates visions and strategies. These describe a business, technology or corporate culture in terms of what it should become over the long term and articulate a feasible way of achieving this goal. And as Warren Bennis and Burt Nanus (9) conclude: Leaders articulate and define what has been previously implicit or unsaid; then they invent images, metaphors and models that provide a focus for new attention. By so doing, they consolidate or challenge prevailing wisdom. In short, an essential factor in leadership is the capacity to influence and organize meaning for members of the organization.

WHAT IS LEADERSHIP?

Leadership is achieving results through people. It happens when there is an objective to be reached or a task to be carried out, and when more than one person is needed to do it. All managers are, by definition, leaders: they can only do their job with the support of their team, who must be inspired or persuaded to follow them. Leadership is therefore about encouraging and inspiring individuals and teams to give of their best to achieve a desired result. The overall aim of leaders is to achieve the task with the help of their group. To meet this overall aim leaders have three main objectives:

1. To gain the commitment and cooperation of their team. 2. To get the group into action to achieve agreed objectives. 3. To make the best use of the skills, energies and talents of the team.

Leaders aim to get people to do what they think is necessary by obtaining willing cooperation, not grudging submission. They build up the morale of their groups, which will be high when the group is productive and works well together. The members of the group do not need to be made comfortable; in fact, they will often be under pressure to do more than they would if left to their own devices. But if they achieve something worth while together they will gain satisfaction from that.

LEADERSHIP QUALITIES

Effective leaders focus on a fairly small range of key issues, have a very clear idea of what they want to do about those issues, and have the ability to set the direction and take people with them. Successful leadership sometimes seems to depend on having the right qualities at the right time. But what are the factors that influence and develop these qualities? A study of chief executives in the UK produced the following ranked list of influences on success: Rating out of 100

1. Ability to work with people 78 2. Early responsibility for important tasks 75 3. A need to achieve results 75 4. Leadership experiences early in career 74 5. Wide experience in many functions 68 6. Ability to make deals and negotiate 66 7. Willingness to take risks 63 8. Ability to have better ideas than colleagues 62 9. Having talents 'stretched' by immediate bosses 60 10. Ability to change managerial style to suit the occasion 58

This list is a mix of abilities or skills (1, 3, 6, 7, 8 and 10) and the types of experience which have developed those abilities (2, 4, 5 and 9). It highlights the fact that natural abilities are only part of the picture. They are nurtured by experience and the situations in which potential and existing

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leaders have found themselves. Leadership is largely an acquired skill. To start with, a leader needs intelligence, a positive attitude and a combination of the qualities of courage, shrewdness and common sense. Successful leaders build on these natural talents as they gain experience and develop the wide range of skills they need.

VISIONARY LEADERSHIP

Visionary leaders have the capacity or the gift to create or reorientate organizations towards success. They are able to envision what the organization should become and what it should achieve and to ensure that their vision is realized. In the words of Tom Peters (46): 'The vision and managers' consistent, daily actions in support of it, is the sea anchor, the basis for keeping people from running around as the waves of change toss them to and fro.' Visionary leaders can be mavericks, people who see and do things differently. They are often outsiders, recruited into an organization, or unconventional insiders - people from within the organization who clearly hold different views from the mainstream about how the organization should operate. Examples include Jan Carl/on of SAS, Sir John Harvey-Jones of ICI, Lord King and Sir Colin Marshall of British Airways, Barry Sullivan of First Chicago, and Jack Welch of General Electric. Bill Richardson (51) suggests that visionary leaders are:

• Relatively comfortable in situations of ambiguity and can live without hard-and-fast answers until trends and solutions emerge

• Seldom original - their visions are formed by listening and observing; their new approaches are based on making connections between what is happening somewhere else and how it might be applied to their own area

• Seekers of excellence, seeing mismatches between how things are done now and how they could be improved

• Orientated towards action - they prefer to talk rather than to write or plan

• Good communicators, capable of ensuring that the meaning and implications of their vision are shared throughout the organization

• Calculated risk-takers • Fixers, in the sense that Tom Peters (46) expressed it: 'fix what's

been wrong in every place you've been' • Independent - they listen but they make up their own minds • Achievement orientated - they are determined to obtain results and

to find ways around the obstacles which inevitably confront the visionary as new ideas are pushed to fruition

• Reward orientated - they want rewards, financial and non-financial, which recognize their achievements

• Optimistic - they believe the world is full of opportunities and that most things are possible.

TYPES OF LEADER

Leaders can be defined in terms of characteristics, success factors and personality trails. To answer the question 'Who is a leader?' it is also helpful to exploit how these combine to produce different types of leader. Leadership types can be classified in a number of ways and the following are some of the most typical categorizations:

1. Charismatic/non-charismatic. Charismatic leaders rely on their aura, their personality and their inspirational qualities. These are natural characteristics, although experience may have taught them how best to project themselves. Non-charismatic leaders rely mainly on their know-how, their ability to give an impression of quiet confidence, and their cool, analytical approach to dealing with problems.

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2. Autocratic/democratic. Autocratic leaders impose their decisions and tend to surround themselves with yes-men. They use their position to force people to do what they are told. Democratic leaders encourage people to participate and involve themselves in decision-taking. They will exert their authority to achieve results but will rely more on know-how and persuasive ability than the use of position power.

3. The visionary/enabler or the controller/manipulator. The visionary/enablers inspire people with their vision of the future. Controller/manipulators are concerned mainly with operating the internal system.

4. Transactional or transformational. Burns (10) distinguishes between transactional leaders who exchange money, jobs and security for compliance, and transformational leaders who motivate others to strive for higher-order goals rather than merely short-term interest.

THE ROLE OF THE LEADER

Leaders have two essential roles. They have to:

1. Achieve the task - that is why their group exists. The leader's role is to ensure that the group's purpose is fulfilled. If it is not, the result is frustration, disharmony, criticism and, eventually perhaps, disintegration of the group.

2. Maintain effective relationships - between themselves and the members of the group, and within the group. These relationships are effective if they are conducive to achieving the task. They can be divided into those concerned with the team and its morale and sense of common purpose, and those concerned with individuals and how they are motivated.

John Adair (1) has suggested that these demands are best expressed as three areas of need which leaders are there to satisfy. These are: 1. Task needs - to get the job done 2. Group needs - to build up and maintain team spirit. 3. Individual needs - to harmonize the needs of the individual with the needs of the task

and the group. These three needs are interdependent and are best expressed as three overlapping circles.

THE LAW OF THE SITUATION

The type of leadership exercised and success as a leader depend to a large extent on the situation and the leader's ability to understand its and act accordingly. The situation comprises the nature of the task, the impact of the organization - its policies, culture and environment, the degree to which the situation is structural or ambiguous, the sort of people in the working group, and the type of authority the leader has - given or assumed. The performance of a group, as Fielder (18) pointed out, is related to both the leadership style and the degree to which the situation provides the leader with the Opportunity to exert influence. His research indicated that a task orientated approach worked best for leaders in the favourable conditions when the leader has power, formal backing and a relatively well simciured task. In these circumstances the group is ready to be directed and told what to do. In emergency or crisis conditions the task-orientated leader is likely to be more effective than the considerate leader who is concerned with interpersonal relationships. The latter will do better in a somewhat unstructured or ambiguous situation, or where his or her power as a leader is restricted. Fiedler called this his contingency theory of leadership and emphasized the situational aspects of being a leader: Leadership performance then depends as much on the organization as on the leader's own attributes. Except perhaps for the unusual case, it is simply not meaningful to speak of an effective leader or an ineffective leader, we can only speak of a leader who tends to be effective in one situation and ineffective in another. Not only does the situation affect the type of leadership required but it will also create conditions under which new and different types of leader will emerge who are appropriately qualified to meet changing demands.

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LEADERSHIP CHECKLIST

The task

1. What needs to be done and why? 2. What results have to be achieved? 3. What problems have to be overcome? 4. Is the solution to these problems straightforward or is there a measure of ambiguity? 5. Is this a crisis situation? 6. What is the time-scale for completing the task? 7. What pressures are going to be exerted on the leader?

The team

8. What is the composition of the team? 9. How well is the team organized? 10. Do the members of the team work well together? 11. What will they want to get out of this? 12. How can the commitment of this particular team be achieved? 13. How are results to be obtained by satisfying their needs? 14. How are they likely to respond to the various leadership styles or approaches which may

be adopted? The individuals in the team

15. What are the strengths and weaknesses of each member of the team?

16. What sort of issues are likely to motivate them? 17. How are they likely to respond individually to the various

leadership techniques or styles the leader may adopt? Case studies The following are descriptions of the leadership style deployed by three highly effective managers. In each case the style was influenced by three factors: the environment, the people involved, and the personality of the manager. Edward Smith Ted Smith was the planning manager in a large engineering works. He had some 200 people working in the departments under his control who dealt with process planning, shop loading and production control. It was a highly responsible job and his staff included highly qualified engineers as well as large numbers of clerks doing routine work. Ted's job was to make sure that his departments ran like clockwork. Everyone had to know exactly what to do and when they had to do it. Close cooperation between the three areas under his control was essential. Charismatic-type leadership was out. He had to be cool, calm, measured and a little bit distant. Everyone in the deportment had to believe he knew what he was doing and what he wanted. He therefore held regular meetings with all his subordinates at which he quickly and efficiently reviewed progress, gave instructions and, as and when necessary, discussed problems. At these meetings he was prepared to switch quickly from being someone who knew exactly what he wanted and who expected people to do exactly as they were told (because it was sensible and right for them to do so) to someone who was prepared to listen to different views, weigh them up and decide. Sometimes he would deliberately throw his managers a problem and tell them to go away and solve it, and let him know the outcome ol" their actions. Ted also ensured that his managers transmitted the content of these meetings down to first line MipctvitOI level. And the latter were encouraged to meet their tectioni regularly. 1 k- emphasized throughout the need for teamwork ami demonstrated his commitment by ensuring that at inter-dcpariMKiit.il meetings problems of lack of cooperation or poor communications were given priority. The only time he was ever seen to express anger was when work suffered because of

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feuds between departments. Elwyn Jones Elwyn Jones was the personnel director of a large conglomerate in the food industry with over 80,000 employees. The firm had grown fast by acquisition and was highly decentralized. Staff were deliberately kept to a minimum at headquarters and Jones had only four executives responsible directly to him. He was, however, also responsible for the implementation of group personnel policies in each of the divisions and on these matters the divisional personnel directors were responsible to him. Jones was not in a position to dictate to divisions what he wanted them to do. He could only influence them, and he felt that he had to get genuine acceptance for new policies before they could be introduced. He therefore had to consult on any changes or innovations he wished to introduce and, in most cases, he had to solicit cooperation on the testing of new ideas. With his headquarters staff, Jones adopted a highly informal, almost permissive approach. He gave them broad guidelines on how they should develop their ideas in the divisions but encouraged them to think and act for themselves. He never called a formal meeting. He was more likely to withdraw to the local pub where, under the watchful eyes of 'big fat Nellie' behind the bar, he consumed pink gins with his colleagues and discussed strategies on entirely equal terms. He adopted precisely the same approach with the divisional personnel directors, although once or twice a year they all got together in a country hotel (one recommended by the Good Food Guide, of course) and spent a pleasant couple of days talking generally about their mutual interests. James Robinson Jim Robinson was the managing director of a medium-sized business (1000 employees) in the fast-moving consumer goods sector of industry. He had come up the hard way and his experience had always been in similar firms. Business was highly competitive and the pressures on maintaining, never mind increasing, market share were considerable. Tough decisions about products, markets and people had to be made often and quickly. There was a non-executive chairman and three outside non-executive directors on the board, but they let Robinson get on with it as long as he delivered the results they wanted - which he did. Robinson was a despot, although a benevolent one. He knew much more about the business as a whole than any of the other four executive directors, and the chairman and the key institutions (who were represented by the non-executive directors on the board) relied implicitly on his judgement. Robinson's management style was rumbustious. He did not suffer fools gladly and he cracked down on any repeated inefficiencies or mistakes. He made the key decisions himself. At meetings of the executive directors he would sometimes say that he wanted the views of those present but stated quite clearly that he had already made up his mind and would Deed I lot of convincing to change it. But his deep understanding of the business and his ability to think faster on his feet than anyone else meant that, while his autocratic behaviour was sometimes resented at the time, those subjected to it would say on almost every occasion 'you've got to give it to the old so-and-so - he knows his stuff and he's right'. He led, they followed. This was simply because they knew he could accomplish whatever was required in the volatile environment in which they worked.

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Documents

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van den bosch

divisional personnel directors

chief executive officer

ohio state studies

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superleaders empower followers