BUS401: Management Leadership

Leadership is the process by which an individual mobilizes people and resources to achieve a goal.

LEARNING OBJECTIVE

• Describe the relationship between leaders and followers

KEY POINTS

• Leadership is the process by which an individual motivates others and mobilizes resources to achieve a goal.
• Leadership is both a set of behaviors that can be learned and a set of traits that can be nurtured.
• Leadership is a relationship between followers and those who inspire and provide direction for them. It involves emotional ties and commitments.

TERM

• Transformational Leadership

  A theory of leading that enhances the motivation, morale, and performance of followers through a variety of mechanisms.

Defining Leadership

Leadership is the process by which an individual mobilizes people and resources to achieve a goal. It requires both a set of skills that can be learned as well as certain attributes that can be nurtured. Leaders inspire, challenge, and encourage others. They can persuade and influence, and they show resilience and persistence. All aspects of society have leaders. The concept of leader may call to mind a CEO, a prime minister, a general, a sports team captain, or a school principal; examples of leadership exist across a variety of organizations.

Leaders motivate others to aspire to achieve and help them to do so. They focus on the big picture with a vision of what could be and help others to see that future and believe it is possible. In this way, leaders seek to bring about substantive changes in their teams, organizations, and societies.

Leadership is a relationship between followers and those who inspire them and provide direction for their efforts and commitments. It affects how people think and feel about their work and how it contributes to a larger whole. Effective leaders can mean the difference between increasing a team's ability to perform or diminishing its performance, between keeping efforts on track or encountering disaster, and even between success or failure.

Leadership and Management

Leadership is one of the most important concepts in management, and many researchers have proposed theories and frameworks for understanding it. Some have distinguished among types of leadership such as charismatic, heroic, and transformational leadership. Other experts discuss the distinctions between managers and leaders, while others address the personality and cognitive factors most likely to predict a successful leader. The many dimensions of leadership indicate how complex a notion it is and how difficult effective leadership can be.

 

Management versus Leadership

Though they have traits in common, leadership and management both have unique responsibilities that do not necessarily overlap.

LEARNING OBJECTIVE

• Distinguish between managerial roles and responsibilities and leadership roles and responsibilities

KEY POINTS

• Many view leaders as those who direct the organization through vision and inspiration; managers are results-oriented and more focused on task organization and efficiency.
• Managers sustain current systems and processes for accomplishing work, while leaders challenge the status quo and make change happen.
• Such distinctions may create a negative concept of managers. "Leader" brings to mind heroic figures rallying people together for a cause, while "manager" suggests less charismatic individuals focusing solely on efficiency.

TERMS

• management

  The act of getting people together to accomplish desired goals and objectives using available resources efficiently and effectively.

• leadership

  A process of social influence in which one person enlists the aid and support of others in accomplishing a common task.

Leaders vs. Managers

The terms "management" and "leadership" have been used interchangeably, yet there are clear similarities and differences between them. Both terms suggest directing the activities of others. In one definition, managers do so by focusing on the organization and performance of tasks and by aiming at efficiency, while leaders engage others by inspiring a shared vision and effectiveness. Managerial work tends to be more transactional, emphasizing processes, coordination, and motivation, while leadership has an emotional appeal, is based on relationships with followers, and seeks to transform.

One traditional way of understanding the differences between managers and leaders is that people manage things but lead other people. More concretely, managers administrate and maintain the systems and processes by which work gets done. Their work includes planning, organizing, staffing, leading, directing, and controlling the activities of individuals, teams, or whole organizations for the purpose of accomplishing a goal. Basically, managers are results-oriented problem-solvers with responsibility for day-to-day functions that focus on the immediate, shorter-term needs of an organization.

In contrast, leaders take the long-term view and have responsibility for where a team or organization is heading and what it achieves. They challenge the status quo, make change happen, and work to develop the capabilities of people to contribute to achieving their shared goals. Additionally, leaders act as figureheads for their teams and organizations by representing their vision and values to outsiders. This definition of leadership may create a negative bias against managers as less noble or less important: "Leader" suggests a heroic figure, rallying people to unite under a common cause, while "manager" calls to mind less charismatic individuals who are focused solely on getting things done.

 

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Sources of Power

Power is the ability to influence the behavior of others with or without resistance by using a variety of tactics to push or prompt action.

LEARNING OBJECTIVE

• Identify the six different sources of power available to organizational leaders and how leaders can employ these sources of power and influence in a meaningful and ethical way

KEY POINTS

• Power is the ability to get things done, sometimes over the resistance of others.
• Leaders have a number of sources of power, including legitimate power, referent power, expert power, reward power, coercive power, and informational power.
• All of these sources of power can be used in combination, and people often have access to more than one of them.
• Power tactics fall along three dimensions: behavioral, rational, and structural.

TERMS

• power

  The ability to influence the behavior of others, with or without resistance.

• Upward Power

  When subordinates influence the decisions of the leader.

• Downward Power

  When a superior influences subordinates.

Power in Business

Power is the ability to get things done. Those with power are able to influence the behavior of others to achieve some goal or objective. Sometimes people resist attempts to make them do certain things, but an effective leader is able to overcome that resistance. Although people sometimes regard power as evil or corrupt, power is a fact of organizational life and in itself is neither good nor bad. Leaders can use power to benefit others or to constrain them, to serve the organization's goals or to undermine them.

Another way to view power is as a resource that people use in relationships. When a leader influences subordinates, it is called downward power. We can also think of this as someone having power over someone else. On the other hand, subordinates can also exercise upward power by trying to influence the decisions of their leader. Indeed, leaders depend on their teams to get things done and in that way are subject to the power of team members.

The Six Sources of Power

Power comes from several sources, each of which has different effects on the targets of that power. Some derive from individual characteristics; others draw on aspects of an organization's structure. Six types of power are legitimate, referent, expert, reward, coercive, and informational.

Legitimate Power

Also called "positional power", this is the power individuals have from their role and status within an organization. Legitimate power usually involves formal authority delegated to the holder of the position.

Referent Power

Referent power comes from the ability of individuals to attract others and build their loyalty. It is based on the personality and interpersonal skills of the power holder. A person may be admired because of a specific personal trait, such as charisma or likability, and these positive feelings become the basis for interpersonal influence.

Expert Power

Expert power draws from a person's skills and knowledge and is especially potent when an organization has a high need for them. Narrower than most sources of power, the power of an expert typically applies only in the specific area of the person's expertise and credibility.

Reward Power

Reward power comes from the ability to confer valued material rewards or create other positive incentives. It refers to the degree to which the individual can provide external motivation to others through benefits or gifts. In an organization, this motivation may include promotions, increases in pay, or extra time off.

Coercive Power

Coercive power is the threat and application of sanctions and other negative consequences. These can include direct punishment or the withholding of desired resources or rewards. Coercive power relies on fear to induce compliance.

Informational Power

Informational power comes from access to facts and knowledge that others find useful or valuable. That access can indicate relationships with other power holders and convey status that creates a positive impression. Informational power offers advantages in building credibility and rational persuasion. It may also serve as the basis for beneficial exchanges with others who seek that information.

All of these sources and uses of power can be combined to achieve a single aim, and individuals can often draw on more than one of them. In fact, the more sources of power to which a person has access, the greater the individual's overall power and ability to get things done.

Power Tactics

People use a variety of power tactics to push or prompt others into action. We can group these tactics into three categories: behavioral, rational, and structural.

Behavioral tactics can be soft or hard. Soft tactics take advantage of the relationship between person and the target. These tactics are more direct and interpersonal and can involve collaboration or other social interaction. Conversely, hard tactics are harsh, forceful, and direct and rely on concrete outcomes. However, they are not necessarily more powerful than soft tactics. In many circumstances, fear of social exclusion can be a much stronger motivator than some kind of physical punishment.

Rational tactics of influence make use of reasoning, logic, and objective judgment, whereas nonrational tactics rely on emotionalism and subjectivity. Examples of each include bargaining and persuasion (rational) and evasion and put downs (nonrational).

Structural tactics exploit aspects of the relationship between individual roles and positions. Bilateral tactics, such as collaboration and negotiation, involve reciprocity on the parts of both the person influencing and the target. Unilateral tactics, on the other hand, are enacted without any participation on the part of the target. These tactics include disengagement and fait accompli. Political approaches, such as playing two against one, take yet another approach to exert influence.

People tend to vary in their use of power tactics, with different types of people opting for different tactics. For instance, interpersonally oriented people tend to use soft tactics, while extroverts employ a greater variety of power tactics than do introverts. Studies have shown that men tend to use bilateral and direct tactics, whereas women tend to use unilateral and indirect tactics. People will also choose different tactics based on the group situation and according to whom they are trying to influence. In the face of resistance, people are more likely to shift from soft to hard tactics to achieve their aims.

 

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A Leader's Influence

Leaders use social influence to maintain support and order with their subordinates.

LEARNING OBJECTIVE

• Differentiate between various methods of influencing others and their role in effective leadership

KEY POINTS

• Influence occurs when other people affect an individual's emotions, opinions, or behaviors. Leaders use influence to create the behaviors needed to achieve their goals and vision.
• Harvard psychologist Herbert Kelman identified three broad varieties of social influence: compliance, identification, and internalization.
• Compliance is people behaving as others expect.
• Identification happens when people are influenced by someone who is well-liked and respected, such as a celebrity.
• Internalization of values leads to those beliefs being reflected in behavior.

TERMS

• social influence

  When an individual's emotions, opinions, or behaviors are affected by others.

• socialization

  The process of inheriting and disseminating norms and customs of behavior along with ideologies and other beliefs.

The Role of Influence in Leadership

Influence occurs when a person's emotions, opinions, or behaviors are affected by others. It is an important component of a leader's ability to use power and maintain respect in an organization. Influence is apparent in the form of peer pressure, socialization, conformity, obedience, and persuasion. The ability to influence is an important asset for leaders, and it is also an important skill for those in sales, marketing, politics, and law.

In 1958, Harvard psychologist Herbert Kelman identified three broad varieties of social influence: compliance, identification, and internalization. Compliance involves people behaving the way others expect them to whether they agree with doing so or not. Obeying the instructions of a crossing guard or an authority figure is an example of compliance. Identification is when people behave according to what they think is valued by those who are well-liked and respected, such as a celebrity. Status is a key aspect of identification: when people purchase something highly coveted by many others, such as the latest smartphone, they are under the influence of identification. Internalization is when people accept, either explicitly or privately, a belief or set of values that leads to behavior that reflects those values. An example is following the tenets of one's religion.

How Leaders Use Influence

In an organization, a leader can use these three types of influence to motivate people and achieve objectives. For example, compliance is a means of maintaining order in the workplace, such as when employees are expected to follow the rules set by their supervisors. Similarly, identification happens when people seek to imitate and follow the actions of people they look up to and respect, for example, a more experienced co-worker or trusted supervisor. Internalization results when employees embrace the vision and values of a leader and develop a commitment to fulfilling them.

Leaders use these different types of influence to motivate the behaviors and actions needed to accomplish tasks and achieve goals. Individuals differ in how susceptible they are to each type of influence. Some workers may care a great deal about what others think of them and thus be more amenable to identifying the cues for how to behave. Other individuals may want to believe strongly in what they do and so seek to internalize a set of values to guide them. In organizations and in most parts of life, sources of influence are all around us. As a result, our behavior can be shaped by how others communicate with us and how we see them.

 

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A Leader's Vision

A clear and well-communicated vision is essential for a leader to gain support and for followers to understand a leader's goals.

LEARNING OBJECTIVE

• Explain the relationship between vision, mission, and strategy as it pertains to leadership

KEY POINTS

• Vision is defined as a clear, distinctive, and specific view of the future that is usually connected with strategic decisions for the organization.
• A thriving organization will have a vision that is succinct, understandable, and indicative of the direction that the company wants to head in the future.
• Leaders are essential for communicating the vision of the organization and promoting the vision through the decisions they make and the strategies they pursue.

TERM

• vision

  A clear, distinctive, and specific view of the future that is usually connected with a leader's strategic advances for the organization.

A vision is defined as a clear, distinctive, and specific view of the future; it is usually connected with strategic advances for the organization. Effective leaders define a vision and build followers' commitment to it. The ability to express a vision and use it to inspire others differentiates a leader from a manager.

Many researchers argue that vision is an essential quality of effective leaders, along with the ability to communicate and to build trust. Effective leaders communicate their vision of the organization. Their decisions and strategies reflect their view of what an enterprise can be rather than what it currently is. A strong leader builds trust in the vision by acting in ways that are consistent with it and by demonstrating to others what it takes to make the vision a reality.

Vision is an essential component of an organization's success. A thriving organization will have a vision that is succinct, understandable, and indicative of the direction that the company wants to head in the future. The more employees are aware of, understand, and accept the vision, the more useful it is in directing their behavior toward the desired end.

Vision and mission are sometimes used interchangeably, but there is a useful distinction between the two. A vision describes an organization's direction, while its mission defines its purpose. By focusing on the value an organization creates, the mission helps prioritize activities and narrow alternatives for decisions.

Vision also plays a significant role in a leader's strategy for the organization. By setting the direction, a vision underscores the necessity of all the areas of a business working toward the same goal. This unity of purpose often involves changing what is done and how, and aligning the activities and behavior of people is critical to fulfilling a leader's vision. A vision reduces ambiguity and provides focus – two benefits that are especially valuable in turbulent or rapidly changing times.

 

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Leadership Traits

Traits of effective leaders are conditionally dependent and have been debated for years, but researchers have identified some commonalities.

LEARNING OBJECTIVE

• Summarize the key characteristics and traits that are predictive of strong leadership capacity

KEY POINTS

• Early findings regarding trait theory show that relationships exist between leadership and individual traits such as intelligence, adjustment, extroversion, conscientiousness, openness to experience, and general self-efficacy.
• Stephen Zaccaro, a researcher of trait theories, argues that effective leadership is derived from an integrated set of cognitive abilities, social capabilities, and dispositional tendencies, with each set of traits adding to the influence of the other.
• Zaccaro's model points to extroversion, agreeableness, conscientiousness, openness, neuroticism, honesty/integrity, charisma, intelligence, creativity, achievement motivation, need for power, oral/written communication, interpersonal skills, general problem-solving, and decision making.

TERMS

• Proximal

  Located close to a reference point.

• distal

  Located far from a reference point.

Researchers have debated the traits of a leader for many decades. Early trait theory proposed that merely a few personality traits have the ability to determine the success of a leader. Researchers have since distanced themselves from this idea and theorized that the success of a leader requires more than just a few essential traits. Researchers now attest that while trait theory may still apply, individuals can and do emerge as leaders across a variety of situations and tasks. Research findings show that significant relationships exist between leadership and a number of individual traits, among them intelligence, adjustment, extroversion, conscientiousness, openness to experience, and general self-efficacy.

One prominent researcher in trait theory, Stephen Zaccaro, proposes a number of models that show the interplay of the environmental and personality characteristics that make a good leader. These models rest on two basic premises about leadership traits. First, leadership emerges from the combined influence of multiple traits, as opposed to coming from various independent traits. In other words, Zaccaro argues that effective leadership is derived from an integrated set of cognitive abilities, social capabilities, and personal tendencies, with each set of traits adding to the influence of the other. The second premise suggests that leadership traits differ in their proximal(direct) influence on leadership. In this multistage model, certain distal or remote attributes (such as personal attributes, cognitive abilities, and motives/values) serve as precursors for the development of personal characteristics that more directly shape a leader.

Some of the inherent leadership traits in Zaccaro's model include extroversion, agreeableness, conscientiousness, openness, neuroticism, honesty/integrity, charisma, intelligence, creativity, achievement motivation, need for power, oral/written communication, interpersonal skills, general problem-solving, decision making, technical knowledge, and management skills. Although these characteristics may resemble a laundry list of traits, Zaccaro and many other researchers have shown that they are all predictors of a successful leader.

 

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Leaders may adopt several styles according to what is most appropriate in a given situation.

LEARNING OBJECTIVE

• Explain how different leadership styles may be adopted according to the demands of a given circumstance

KEY POINTS

• There are five primary leadership styles: engaging, authoritative, laissez-faire, participative, and transformational. All five styles can be effectively used in appropriate circumstances.
• An engaging style of leadership involves reaching out to employees and understanding their concerns and working situations.
• Under the autocratic leadership style, all decision-making powers are centralized in the leader. Leaders do not entertain any suggestions or initiatives from subordinates.
• A person using a laissez-faire style of leadership does not provide direction, instead of leaving the group to fend for itself. Subordinates are given a free hand in deciding their own policies and methods.
• A participative or democratic style of leadership involves the leader's sharing decision-making authority with group members while also promoting the interests of group members and practicing social equality.
• Transformational leadership motivates and inspires people to change their behaviors in service of a greater good.

TERM

• laissez-faire

  French term literally meaning "let [them] do"; it also broadly implies "let it be", "let them do as they will", or "leave it alone".

Finding the Right Style of Leadership

A leader can take a number of different approaches to leading and managing an organization. A leader's style of providing direction, setting strategy, and motivating people is the result of his or her personality, values, training, and experience. For example, a leader with a laid-back personality may lead with a less formal style that encourages autonomy and creativity.

Engaging Leadership

Engaging styles of leadership involve reaching out to employees and understanding their concerns and working situations. Dr. Stephen L. Cohen, the senior vice president for Right Management's Leadership Development Center of Excellence, describes the engaging leadership style as communicating relevant information to employees and involving them in important decisions. This leadership style can help retain employees for the long term.

Autocratic/Authoritarian Leadership

Under the autocratic leadership style, decision-making power is centralized in the leader. Leaders do not entertain any suggestions or initiatives from subordinates. Autocratic management is effective for quick decision making but is generally not successful in fostering employee engagement or maintaining worker satisfaction.

Laissez-faire/Free-Rein Leadership

A person may be in a leadership position without providing clear direction, leaving the group to choose its own path in achieving aims. Subordinates are given a free hand in deciding their own policies and methods. Laissez-faire is most effective when workers have the skills to work independently, are self-motivated, and will be held accountable for results.

Participative or Democratic Leadership

A participative or democratic style of leadership involves the leader's sharing decision- making authority with group members. This approach values the perspectives and interests of individual group members while also contributing to team cohesion. Participative leadership can help employees feel more invested in decision outcomes and more committed to the choices because they have a say in them.

Transformational Leadership

The transformational leadership style emphasizes motivation and morale to inspire followers to change their behavior in service of the greater good. The concept was initially introduced by James MacGregor Burns. According to Burns, transformational leadership is when "leaders and followers make each other advance to a higher level of morality and motivation". Researcher Bernard M. Bass used Burns's ideas to develop his own theory of transformational leadership. Bass clarified the definition to emphasize that transformational leadership is distinguished by the effect it has on followers.

When to Use Different Styles

Different situations call for particular leadership styles. Under intense time constraints, when there is little room to engage in long discussions that seek consensus, a more directive, top-down style may be appropriate. For a highly motivated and cohesive team with a homogeneous level of expertise, a democratic leadership style may be more effective. Similarly, a participative leadership style may be most appropriate for decisions that will require changes in behavior from a large group of people.

Each style of leadership can be effective if matched with the needs of the situation and used by a skilled leader who can adopt a deft approach. The most effective leaders are adept at several styles and able to choose the one most likely to help the organization achieve its objectives.

 

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Four Theories of Leadership

Theories of effective leadership include the trait, contingency, behavioral, and full-range theories.

LEARNING OBJECTIVE

• Discuss differing theories and approaches to defining and understanding leadership

KEY POINTS

• Modern trait theory proposes that individuals emerge as leaders across a variety of situations and tasks; significant individual leadership traits include intelligence, adjustment, extroversion, conscientiousness, openness to experience, and general self-efficacy.
• Behavioral theory suggests that leadership requires a strong personality with a well-developed positive ego; self-confidence is essential.
• Contingency theory assumes that different situations call for different characteristics, and no single optimal psychological profile of a leader exists.
• According to the full-range theory of leadership, four qualities are essential for leaders: individualized consideration, intellectual stimulation, inspirational motivation, and idealized influence.

TERM

• Contingency

  Likely to happen in connection with or as a consequence of something else.

For a number of years, researchers have examined leadership to discover how successful leaders are created. Experts have proposed several theories, including the trait, behavioral, contingency, and full-range models of leadership.

The Trait Theory of Leadership

The search for the characteristics or traits of effective leaders has been central to the study of leadership. Underlying this research is the assumption that leadership capabilities are rooted in characteristics possessed by individuals. Research in the field of trait theory has shown significant positive relationships between effective leadership and personality traits such as intelligence, extroversion, conscientiousness, self-efficacy, and openness to experience. These findings also show that individuals emerge as leaders across a variety of situations and tasks.

The Contingency Theory of Leadership

Stogdill and Mann found that while some traits were common across a number of studies, the overall evidence suggested that persons who are leaders in one situation may not necessarily be leaders in other situations. According to this approach, called contingency theory, no single psychological profile or set of enduring traits links directly to effective leadership. Instead, the interaction between those individual traits and the prevailing conditions is what creates effective leadership. In other words, contingency theory proposes that effective leadership is contingent on factors independent of an individual leader. As such, the theory predicts that effective leaders are those whose personal traits match the needs of the situation in which they find themselves. Fiedler's contingency model of leadership focuses on the interaction of leadership style and the situation (later called situational control). He identified three relevant aspects of the situation: the quality of the leader's relationships with others, how well structured their tasks were, and the leader's amount of formal authority.

The Behavioral Theory of Leadership

In response to the early criticisms of the trait approach, theorists began to research leadership as a set of behaviors. They evaluated what successful leaders did, developed a taxonomy of actions, and identified broad patterns that indicated different leadership styles. Behavioral theory also incorporates B.F. Skinner's theory of behavior modification, which takes into account the effect of reward and punishment on changing behavior. An example of this theory in action is a manager or leader who motivates desired behavior by scolding employees who arrive late to meetings and showing appreciation when they are early or on time.

The Full-Range Theory of Leadership

The full-range theory of leadership is a component of transformational leadership, which enhances motivation and morale by connecting the employee's sense of identity to a project and the collective identity of the organization. The four major components of the theory, which cover the full range of essential qualities of a good leader, are:

• Individualized consideration: the degree to which the leader attends to each follower's concerns and needs and acts as a mentor or coach
• Intellectual stimulation: the degree to which the leader challenges assumptions, takes risks, and solicits followers' ideas
• Inspirational motivation: the degree to which the leader articulates a vision that is appealing and inspiring to followers
• Idealized influence: the degree to which the leader provides a role model for high ethical behavior, instills pride, and gains respect and trust

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Source: Boundless
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