Alex ferguson autocratic leadership style

Apply: Leadership Examination

Resources: Ch.12 and 14 of Management

Prepare a 700- to 1,050-word paper outlining key concepts of leadership.

Include the following in your paper:

Describe at least three different types of behavioral leadership approaches.
Select a prominent leader and identify their dominant leadership style. Provide examples to justify your selection.
Explain the two Situational Leadership Approaches (the Fiedler contingency leadership model and the path-goal leadership model).
Analyze their potential advantages over the behavioral leadership approaches.
Explore the uses of Transformational Leadership, including the idea that the best leaders are both transactional and transformational.
Assess the four key behaviors of transformational leaders for inspiring employees.

Major Questions You Should Be Able to Answer

14.1

The Nature of Leadership: Wielding Influence

Major Question: I don’t want to be just a manager; I want to be a leader. What’s the difference between the two?

14.2

Trait Approaches: Do Leaders Have Distinctive Personality Characteristics?

Major Question: What does it take to be a successful leader?

14.3

Behavioral Approaches: Do Leaders Show Distinctive Patterns of Behavior?

Major Question: Do effective leaders behave in similar ways?

14.4

Situational Approaches: Should Leadership Vary with the Situation?

Major Question: How might effective leadership vary according to the situation at hand?

14.5

The Uses of Transformational Leadership

Major Question: What does it take to truly inspire people to perform beyond their normal levels?

14.6

Three Additional Perspectives

Major Question: If there are many ways to be a leader, which one would describe me best?

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the manager’s toolbox

Advancing Your Career: Staying Ahead in the Workplace of Tomorrow

Someday maybe you can afford to have a personal career coach—the kind long used by sports and entertainment figures and now adopted in the upper ranks of business. These individuals “combine executive coaching and career consulting with marketing and negotiations,” says one account. “They plot career strategy, help build networks of business contacts, . . . and shape their clients’ images.”1

One such career coach is Richard L. Knowdell, president of Career Research and Testing in San Jose, California. He offers the following strategies for staying ahead in the workplace of tomorrow.2

Take Charge of Your Career, & Avoid Misconceptions

Because you, not others, are in charge of your career, and it’s an ongoing process, you should develop a career plan and base your choices on that plan. When considering a new job or industry, find out how that world really works, not what it’s reputed to be. When considering a company you might want to work for, find out its corporate “style” or culture by talking to its employees.

Develop New Capacities

“Being good at several things will be more advantageous in the long run than being excellent at one narrow specialty,” says Knowdell. “A complex world will not only demand specialized knowledge but also general and flexible skills.”

Anticipate & Adapt to, Even Embrace, Changes

Learn to analyze, anticipate, and adapt to new circumstances in the world and in your own life. For instance, as technology changes the rules, embrace the new rules.

Keep Learning

“You can take a one- or two-day course in a new subject,” says Knowdell, “just to get an idea of whether you want to use those specific skills and to see if you would be good at it. Then, if there is a match, you could seek out an extended course.”

Develop Your People & Communications Skills

No matter how much communication technology takes over the workplace, there will always be a strong need for effectiveness in interpersonal relationships. In particular, learn to listen well. Incidentally, one poll found that “appearance”—meaning clothes, accessories, and shoes—ranked second only to “communication skills” as the quality most associated with professionalism.3 (You might try imitating your bosses’ clothing styles.)

For Discussion Which of these five rules do you think is most important—and why?

Are there differences between managers and leaders? This chapter considers this question. We discuss the sources of a leader’s power and how leaders use persuasion to influence people. We then consider the following approaches to leadership: trait, behavioral, situational, transformational, and three additional perspectives.

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The Nature of Leadership: Wielding Influence

I don’t want to be just a manager; I want to be a leader. What’s the difference between the two?

THE BIG PICTURE

Being a manager and being a leader are not the same. That said, they both are necessary in the pursuit of organizational goals. For example, leadership skills are needed to create and communicate a company’s vision, strategies, and goals, while management skills are needed to execute on these plans and goals. This section highlights how management and leadership skills are complementary and describes five sources of power leaders draw on to influence others. Leaders use the power of persuasion to get others to follow them. Five approaches to leadership are described in the next five sections.

Leadership. What is it? Is it a skill anyone can develop?

Leadership is the ability to influence employees to voluntarily pursue organizational goals. 4 In an effective organization, leadership is present at all levels, say Tom Peters and Nancy Austin in A Passion for Excellence, and it represents the sum of many things. Leadership, they say, “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.”5

Managers & Leaders: Not Always the Same

You see the words manager and leader used interchangeably all the time. However, as one pair of leadership experts has said, “Leaders manage and managers lead, but the two activities are not synonymous.”6

“Management,” says Tim Bucher, CEO of TastingRoom.com, a wine site, “is about doing things right—dotting the I’s, crossing the T’s. . . . But leadership is about doing the right thing. . . . You have to make a call, and in some ways it might be against company policy.”7

Managers do planning, organizing, directing, and control. Leaders inspire, encourage, and rally others to achieve great goals. Managers implement a company’s vision and strategic plan. Leaders create and articulate that vision and plan. The table on the next page summarizes key characteristics of each. (See Table 14.1 .)

Managerial Leadership: Can You Be Both a Manager & a Leader?

Absolutely. The latest thinking is that individuals are able to exhibit a broad array of the contrasting behaviors shown in Table 14.1 (a concept called behavioral complexity).8 Thus, in the workplace, many people are capable of exhibiting managerial leadership, defined as “the process of influencing others to understand and agree about what needs to be done and the process of facilitating individual and collective efforts to accomplish shared objectives.” 9 Here the “influencing” part is leadership and the “facilitating” part is management.

Managerial leadership may be demonstrated not only by managers appointed to their positions but also by those who exercise leadership on a daily basis but don’t carry formal management titles (such as certain coworkers on a team).

Page 443TABLE 14.1 Characteristics of Being a Manager & a Leader

Source: Adapted from P. Lorenzi, “Managing for the Common Good: Prosocial Leadership,” Organizational Dynamics, Vol. 33, No. 3 (2004), p. 286. Reprinted with permission from Elsevier.

Coping with Complexity versus Coping with Change: The Thoughts of John Kotter

In considering management versus leadership, retired Harvard Business School professor John Kotter suggests that one is not better than the other, that in fact they are complementary systems of action. The difference is that . . .

Management is about coping with complexity,

Leadership is about coping with change. 10

Let’s consider these differences.

Being a Manager: Coping with Complexity Management is necessary because complex organizations, especially the large ones that so much dominate the economic landscape, tend to become chaotic unless there is good management.11 (For a good description of a manager’s busy day, review Chapter 1, as analyzed by Henry Mintzberg.)

According to Kotter, companies manage complexity in three ways:

Determining what needs to be done—planning and budgeting. Companies manage complexity first by planning and budgeting—setting targets or goals for the future, establishing steps for achieving them, and allocating resources to accomplish them.

Creating arrangements of people to accomplish an agenda—organizing and staffing. Management achieves its plan by organizing and staffing, Kotter says—creating the organizational structure and hiring qualified individuals to fill the necessary jobs, then devising systems of implementation.

Ensuring people do their jobs—controlling and problem solving. Management ensures the plan is accomplished by controlling and problem solving, says Kotter. That is, managers monitor results versus the plan in some detail by means of reports, meetings, and other tools. They then plan and organize to solve problems as they arise.

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Amazing Amazon. Jeffrey Bezos, founder and CEO of online retailer Amazon.com, has done nearly everything Kotter suggests. For instance, Bezos’s “culture of divine discontent” permits employees to plunge ahead with new ideas even though they know that most will probably fail.

Being a Leader: Coping with Change As the business world has become more competitive and volatile, doing things the same way as last year (or doing it 5% better) is no longer a formula for success. More changes are required for survival—hence the need for leadership.

Leadership copes with change in three ways:

Determining what needs to be done—setting a direction. Instead of dealing with complexity through planning and budgeting, leaders strive for constructive change by setting a direction. That is, they develop a vision for the future, along with strategies for realizing the changes.

Creating arrangements of people to accomplish an agenda—aligning people. Instead of organizing and staffing, leaders are concerned with aligning people, Kotter says. That is, they communicate the new direction to people in the company who can understand the vision and build coalitions that will realize it.

Ensuring people do their jobs—motivating and inspiring. Instead of controlling and problem solving, leaders try to achieve their vision by motivating and inspiring. That is, they appeal to “basic but often untapped human needs, values, and emotions,” says Kotter, to keep people moving in the right direction, despite obstacles to change.

Do Kotter’s ideas describe real leaders in the real business world? Certainly many participants in a seminar convened by Harvard Business Review appeared to agree. “The primary task of leadership is to communicate the vision and the values of an organization,” Frederick Smith, chairman and CEO of FedEx, told the group. “Second, leaders must win support for the vision and values they articulate. And third, leaders have to reinforce the vision and the values.”12

Do You Have What It Takes to Be a Leader? Managers have legitimate power (as we’ll describe) that derives from the formal authority of the positions to which they have been appointed. This power allows managers to hire and fire, reward and punish. Managers plan, organize, and control, but they don’t necessarily have the characteristics to be leaders.

Whereas management is a process that lots of people are able to learn, leadership is more visionary. As we’ve said, leaders inspire others, provide emotional support, and try to get employees to rally around a common goal. Leaders also play a role in creating a vision and strategic plan for an organization, which managers are then charged with implementing.

Do you feel you’re up for being a leader? Is getting a college degree part of your plan for moving into the managerial ranks? Everyone is not suited to lead and you can get feedback on your readiness to lead by completing Self-Assessment 14.1.

SELF-ASSESSMENT 14.1

Assessing Your Readiness to Assume the Leadership Role

The following survey was designed to assess your readiness to assume the leadership role. Go to connect.mheducation.com and take Self-Assessment 14.1. When you’re done, answer the following questions:

1. What is your level of readiness? Are you surprised by the results?

2. Looking at the three highest- and lowest-rated items in the survey, what can you do to increase your readiness to lead? Think of specific actions you take right now.

3. Do you think your readiness to lead will change over time? Explain your rationale.

Page 445Five Sources of Power

To really understand leadership, we need to understand the concept of power and authority. Authority is the right to perform or command; it comes with the job. In contrast, power is the extent to which a person is able to influence others so they respond to orders.

People who pursue personalized power —power directed at helping oneself—as a way of enhancing their own selfish ends may give the word power a bad name. However, there is another kind of power, socialized power —power directed at helping others. 13 This is the kind of power you hear in expressions such as “My goal is to have a powerful impact on my community.”

Within organizations there are typically five sources of power leaders may draw on: legitimate, reward, coercive, expert, and referent.

1. Legitimate Power: Influencing Behavior Because of One’s Formal Position Legitimate power , which all managers have, is power that results from managers’ formal positions within the organization. All managers have legitimate power over their employees, deriving from their position, whether it’s a construction boss, ad account supervisor, sales manager, or CEO. This power may be exerted both positively or negatively—as praise or as criticism, for example.

2. Reward Power: Influencing Behavior by Promising or Giving Rewards Reward power , which all managers have, is power that results from managers’ authority to reward their subordinates. Rewards can range from praise to pay raises, from recognition to promotions.

Example: “Talking to people effectively is all about being encouraging,” says Andrea Wong, president and CEO of Lifetime Network and Entertainment Services. She tries to use praise to reward positive behavior. “When I have something bad to say to someone, it’s always hard because I’m always thinking of the best way to say it.”14

3. Coercive Power: Influencing Behavior by Threatening or Giving Punishment Coercive power , which all managers have, results from managers’ authority to punish their subordinates. Punishment can range from verbal or written reprimands to demotions to terminations. In some lines of work, fines and suspensions may be used. Coercive power has to be used judiciously, of course, since a manager who is seen as being constantly negative will produce a lot of resentment among employees. But there have been many leaders who have risen to the top of major corporations—such as Disney’s Michael Eisner, Miramax’s Harvey Weinstein, and Apple’s Steve Jobs—who have been abrasive and intimidating.15

4. Expert Power: Influencing Behavior Because of One’s Expertise Expert power is power resulting from one’s specialized information or expertise. Expertise, or special knowledge, can be mundane, such as knowing the work schedules and assignments of the people who report to you. Or it can be sophisticated, such as having computer or medical knowledge. Secretaries may have expert power because, for example, they have been in a job a long time and know all the necessary contacts. CEOs may have expert power because they have strategic knowledge not shared by many others.

5. Referent Power: Influencing Behavior Because of One’s Personal Attraction Referent power is power deriving from one’s personal attraction. As we will see later in this chapter (under the discussion of transformational leadership, Section 14.5), this kind of power characterizes strong, visionary leaders who are able to persuade their followers by dint of their personality, attitudes, or background. Referent power may be associated with managers, but it is more likely to be characteristic of leaders.

Page 446Leadership & Influence: Using Persuasion to Get Your Way at Work

Steve Harrison, CEO of a career management firm, was escorting Ray, his newly hired chief operating officer, to meet people at a branch office. After greeting the receptionist and starting to lead Ray past her into the interior offices, Harrison felt himself being pulled back. He watched as Ray stuck out his hand, smiled, and said, “Good morning, Melissa, I’m Ray. I’m new here. It’s so great to meet you!” He then launched into a dialogue with Melissa, to her obvious delight.

Afterward, Harrison asked Ray, “What was that all about?” “It’s called the two-minute schmooze,” Ray replied. “Our receptionists meet or talk by phone to more people critical to our company in one day than you or I will ever meet in the course of a year.”16

Ray would probably be considered a leader because of his ability to influence others—to get them to follow his wishes. There are nine tactics for trying to influence others, but some work better than others. In one pair of studies, employees were asked in effect, “How do you get your boss, coworker, or subordinate to do something you want?” The nine answers—ranked from most used to least used tactics—were as follows.17

1. Rational Persuasion Trying to convince someone by using reason, logic, or facts.

Example: “You know, all the cutting-edge companies use this approach.”

2. Inspirational Appeals Trying to build enthusiasm or confidence by appealing to others’ emotions, ideals, or values.

Example: “If we do this as a goodwill gesture, customers will love us.”

3. Consultation Getting others to participate in a decision or change.

Example: “Wonder if I could get your thoughts about this matter.”

4. Ingratiating Tactics Acting humble or friendly or making someone feel good or feel important before making a request.

Example: “I hate to impose on your time, knowing how busy you are, but you’re the only one who can help me.”

5. Personal Appeals Referring to friendship and loyalty when making a request.

Example: “We’ve known each other a long time, and I’m sure I can count on you.”

6. Exchange Tactics Reminding someone of past favors or offering to trade favors.

Example: “Since I backed you at last month’s meeting, maybe you could help me this time around.”

7. Coalition Tactics Getting others to support your effort to persuade someone.

Example: “Everyone in the department thinks this is a great idea.”

8. Pressure Tactics Using demands, threats, or intimidation to gain compliance.

Example: “If this doesn’t happen, you’d better think about cleaning out your desk.”

9. Legitimating Tactics Basing a request on one’s authority or right, organizational rules or policies, or express or implied support from superiors.

Example: “This has been green-lighted at the highest levels.”

Page 447These influence tactics are considered generic because they are applied in all directions—up, down, and sideways within the organization. The first five influence tactics are considered “soft” tactics because they are considered friendlier than the last four “hard,” or pressure, tactics. As it happens, research shows that of the three possible responses to an influence tactic—enthusiastic commitment, grudging compliance, and outright resistance—commitment is most apt to result when the tactics used are consultation, strong rational persuasion, and inspirational appeals.18

Knowing this, do you think you have what it takes to be a leader? To answer this, you need to understand what factors produce people of leadership character. We consider these in the rest of the chapter.

Five Approaches to Leadership

The next five sections describe five principal approaches or perspectives on leadership, which have been refined by research. They are (1) trait, (2) behavioral, (3) situational, (4) transformational, and (5) three additional. (See Table 14.2 .)

TABLE 14.2 Five Approaches to Leadership

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Trait Approaches: Do Leaders Have Distinctive Personality Characteristics?

What does it take to be a successful leader?

THE BIG PICTURE

Trait approaches attempt to identify distinctive characteristics that account for the effectiveness of leaders. We describe (1) positive task-oriented traits and positive/negative interpersonal attributes (narcissism, Machiavellianism, psychopathy) and (2) some results of gender studies.

Consider a leader dubbed “CEO of the Decade” in 2009 by Fortune magazine for 10 years of achievements in the fields of music, movies, and mobile phones, not to mention computing. “Remaking any one business is a career-defining achievement,” wrote Fortune editor Adam Lashinsky; “four is unheard of.”19

That leader was, of course, the late Steve Jobs of Apple. Did he have distinctive personality traits that might teach us something about leadership? Perhaps he did. He seemed to embody the traits of (1) dominance, (2) intelligence, (3) self-confidence, (4) high energy, and (5) task-relevant knowledge.

These are the five traits that researcher Ralph Stogdill in 1948 concluded were typical of successful leaders.20 Stogdill is one of many contributors to trait approaches to leadership, which attempt to identify distinctive characteristics that account for the effectiveness of leaders. 21

Positive Task-Oriented Traits & Positive/Negative Interpersonal Attributes

Traits play a central role in how we perceive leaders, and they ultimately affect leadership effectiveness.22 On the basis of more recent studies, we would revise Stogdill’s leadership list to comprise the following four positive task-oriented traits: (1) intelligence, (2) conscientiousness, (3) openness to experience, and (4) emotional stability.

These traits in turn can be expanded into a list of both positive and negative interpersonal attributes often found in leaders, as shown at left.23 (See Table 14.3 .)

TABLE 14.3 Key Positive & Negative Interpersonal Attributes Often Found in Leaders

“Dark Side” Traits: Narcissism, Machiavellianism, & Psychopathy We have discussed most positive interpersonal attributes elsewhere, but we need to describe the negative, or “dark side,” traits of some leaders: narcissism, Machiavellianism, and psychopathy.24

Narcissism. Narcissism is defined as having “a self-centered perspective, feelings of superiority, and a drive for personal power and glory.” 25 Narcissists have inflated views of themselves, seek to attract the admiration of others, and fantasize about being in control of everything. Although passionate and charismatic, narcissistic leaders may provoke counterproductive work behaviors in others, such as strong resentments and resistance.26

Machiavellianism. Inspired by the pessimistic beliefs of Niccolò Machiavelli, a philosopher and writer (The Prince) in the Italian Renaissance, Machiavellianism (pronounced “mah-kyah-vel-yahn-izm”) displays a cynical view of human nature and condones opportunistic and unethical ways of manipulating people, putting results over principles. This view is manifested in such expressions as “All people lie to get what they want” and “You have to cheat to get ahead.” Like narcissism, Machiavellianism is also associated with counterproductive work behaviors, especially as people begin to understand that they are being coldly manipulated.

Page 449 Psychopathy. Psychopathy (“sigh-kop-a-thee”) is characterized by lack of concern for others, impulsive behavior, and a dearth of remorse when the psychopath’s actions harm others. Not surprisingly, a person with a psychopathic personality can be a truly toxic influence in the workplace.

If you have a propensity for any of these, you need to know that the expression of “dark side” traits tends to result in career derailment—being demoted or fired.27

Is Trait Theory Useful? Three ways in which organizations may apply trait theory are as follows:

Use personality and trait assessments. Organizations may incorporate personality and trait assessments into their selection and promotion processes (being careful to use valid measures of leadership traits).

Choose personality over intelligence. According to research, when organizations are selecting leaders, personality should be considered more important than intelligence.28

Use management development programs. To enhance employee leadership traits and positive personal attributes, a great number of companies send targeted employees to management development programs that include management classes, coaching sessions, trait assessments, mentoring, and the like.29

Gender Studies: Do Women Have Traits that Make Them Better Leaders?

Do women not want to be at the top of the organizational pyramid? Despite the myths, actually they do.

Indeed, a New York research firm found that 55% of women and 57% of men aspire to be CEO, challenging the notion that more women aren’t at the top because they don’t want to be there.30 Indeed, women have been found to be just as assertive as men.31 In fact, it’s possible that women may have traits that make them better managers—indeed, better leaders—than men.

The Evidence on Women Executives A number of management studies have found, according to BusinessWeek, that by and large “women executives, when rated by their peers, underlings, and bosses, score higher than their male counterparts on a wide variety of measures—from producing high-quality work to goal-setting to mentoring employees.”32 In one study of 425 high-level executives, women won higher ratings on 42 of the 52 skills measured.33

What are the desirable traits in which women excel?

Women were found to be better at teamwork and partnering, being more collaborative, seeking less personal glory, being motivated less by self-interest than in what they can do for the company, being more stable, and being less turf conscious. Women were also found to be better at producing quality work, recognizing trends, and generating new ideas and acting on them. Women used a more democratic or participative style than men, who were apt to use a more autocratic and directive style than women.34

Women have been found to display more social leadership, whereas men have been found to display more task leadership.35

Women executives, when rated by their peers, managers, and direct reports, scored higher than their male counterparts on a variety of effectiveness criteria.36

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Sheryl Sandberg. Named in 2014 the ninth most powerful woman in the world by Forbes and the 10th most powerful woman in business by Fortune, Sandberg is the chief operating officer (COO) and business face of Facebook. She’s also a passionate advocate for women achieving more top corporate leadership jobs. As she told a Barnard College graduating class, “A world where men ran half our homes and women ran half our institutions would be just a much greater world.”

The Lack of Women at the Top Only 24 women (4.8%) are CEOs of Fortune 500 companies, and only 45 women (5.1%) are CEOs of Fortune 1000 firms.37 In addition, less than 9% of top management positions are filled by women.38 Interestingly, however, companies with the top 10 highest paid female CEOs produce significantly higher dividends than firms with the top 10 highest paid male CEOs—2.98% versus 2.45%, according to one study.39 So why, then, aren’t more women in positions of leadership? Among the possible explanations:

Unwillingness to compete or sacrifice. Though hardworking, many women simply aren’t willing to compete as hard as most men are or are not willing to make the required personal sacrifices.40 As Jamie Gorelick, former vice chair of Fannie Mae but also mother of two children ages 10 and 15, said when declining to be considered for CEO: “I just don’t want that pace in my life.”41

Modesty. Women have a tendency to be overly modest and to give credit to others rather than taking it for themselves, which can undermine opportunities for promotions and raises.42

Lack of mentor. Women are less likely than their male counterparts to have access to a supportive mentor.43

Starting out lower, and more likely to quit. Perhaps most important, early career success is pivotal; women MBAs start out at lower levels than men do in their first jobs, putting them at a disadvantage that is hard to overcome. Further, findings from a study of over 475,000 people from 20 corporations revealed that women quit their jobs more often than men.44 Higher quit rates can deprive women from obtaining promotions and experiences needed for career advancement.

Things may be gradually changing, though not as fast as they should. With more than half of college students being women and with women making up half the workforce, it’s possible that the new group rising through middle management could well lead to more than 100 Fortune 500 CEOs in the next 10 years.45

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Behavioral Approaches: Do Leaders Show Distinctive Patterns of Behavior?

Do effective leaders behave in similar ways?

THE BIG PICTURE

Behavioral leadership approaches try to determine unique behaviors displayed by effective leaders. These approaches can be divided into four categories, the first three of which are discussed in this section: (1) task-oriented behavior, (2) relationship-oriented behavior, (3) passive behavior, and (4) transformational behavior (discussed in Section 14.5).

Maybe what’s important to know about leaders is not their personality traits but rather their patterns of behavior. This is the line of thought pursued by those interested in behavioral leadership approaches, which attempt to determine the unique behaviors displayed by effective leaders. These approaches can be divided into four categories:

Task-oriented behavior

Relationship-oriented behavior

Passive behavior

Transformational behavior (discussed in Section 14.5)

Task-Oriented Leader Behaviors: Initiating-Structure Leadership & Transactional Leadership

The primary purpose of task-oriented leadership behaviors is to ensure that people, equipment, and other resources are used in an efficient way to accomplish the mission of a group or organization. 46 Examples of task-oriented behaviors are planning, clarifying, monitoring, and problem solving. However, two kinds are particularly important: (1) initiating-structure leadership and (2) transactional leadership.47

Men of steel. What kind of leadership behavior is appropriate for directing these kinds of workers—the kind that directs them how to complete the task or the kind that develops good worker-boss relationships?

Page 452Initiating-Structure Leadership: “Here’s What We Do to Get the Job Done” Initiating-structure leadership is leader behavior that organizes and defines—that is, “initiates the structure for”—what employees should be doing to maximize output. Clearly, this is a very task-oriented approach.

Example: Stephen Greer, head of Hong Kong–based metal recycler Hartwell Pacific, was so focused on new markets that he neglected to keep his eye on essential control systems such as accounting procedures, inventory audits, and new-hire reference checks—until the day he woke up to find the company was losing several million dollars from fraud and theft. Greer, whose entrepreneurial experience is described in Starting from Scrap, then launched oversight systems for his Asian operations: installing metal detectors, requiring three management signatures on company checks, having local finance managers report directly to headquarters instead of to their own general managers, and regularly bringing local managers to the headquarters to compare revenues, costs, and overall performance so as to determine if one site might be out of line with the others. Result: Greer’s initiating-structure leadership helped to correct the fraud and theft problems, ultimately leading to profitable growth.48

Transactional Leadership: “Here’s What We Do to Get the Job Done, & Here Are the Rewards” As a manager, your power stems from your ability to provide rewards (and threaten reprimands) in exchange for your subordinates’ doing the work. When you do this, you are performing transactional leadership, focusing on clarifying employees’ roles and task requirements and providing rewards and punishments contingent on performance. As with initiating structure leadership, transactional leadership also encompasses setting goals and monitoring progress.49

Example: Chicago-based ThoughtWorks, a software developer, 40 sales representatives. When the company was founded in 1993, CEO Craig Gorsline determined the sales reps’ roles and task requirements were to explain software pricing and policies, as well as close sales and do customer hand holding. The rewards paid to reps consisted of commissions on the revenue they generated, a common method of compensation in sales.

Recently, ThoughtWorks executives decided this transactional model had to be changed. Customers now used the Internet to compare pricing and policies. Moreover, paying sales commissions ran the risk of such negative behaviors as, according to The New York Times, “focusing on an individual’s profit over the company’s, emphasizing short-term outcomes, and encouraging competition among sales representatives.”50 The new world demanded reps who could do what was right for the customer rather than themselves. Accordingly, ThoughtWorks abolished commissions in favor of paying reps a straight salary—a move many favored because it guaranteed them a steady paycheck.

Initiating-structure leadership has a moderately strong positive relationship with leadership effectiveness, according to research.51 Transaction leadership also has a positive association with leader effectiveness and group performance.52

Relationship-Oriented Leader Behavior: Consideration, Empowerment, & Servant Leadership

Relationship-oriented leadership is primarily concerned with the leader’s interactions with his or her people. The emphasis is on enhancing employees’ skills and creating positive work relationships among coworkers and between the leader and the led. Such leaders often act as mentors, providing career advice, giving employees assignments that will broaden their skills, and empowering them to make their own decisions.53

There are three kinds of relationship-oriented behaviors:

Consideration

Empowering leadership

Servant leadership

Page 453Consideration: “The Concerns & Needs of My Employees Are Highly Important” Consideration is leader behavior that is concerned with group members’ needs and desires and that is directed at creating mutual respect or trust. This is an important type of behavior to use in addition to task leadership because it promotes social interactions and identification with the team and leader. Considerate leader behavior has a moderately strong positive relationship with measures of leadership effectiveness.54

The most effective leaders use different blends of task behavior and consideration when interacting with others. To what extent do you think you do this when interacting with school or work colleagues? You can answer this question by taking Self-Assessment 14.2.

SELF-ASSESSMENT 14.2

Assessing Your Task & Relationship-Oriented Leader Behavior

The following survey was designed to evaluate your own leader behavior. Go to connect.mheducation.com and take Self-Assessment 14.2. When you’re done, answer the following questions:

1. Do you prefer to use task or relationship leadership? Why do you think this is the case?

2. Look at the items for the two lowest scored items for initiating structure and consideration and then identify how you can increase the extent to which you display both types of leadership.

3. When would it be most important to display initiating structure and consideration? Explain your rationale.

Empowering Leadership: “I Want My Employees to Feel They Have Control over Their Work” Empowering leadership represents the extent to which a leader creates perceptions of psychological empowerment in others. Psychological empowerment is employees’ belief that they have control over their work. Such psychological empowerment is expected to drive intrinsic motivation, creativity, and performance.55 Let’s see how this process works.

Increasing employee psychological empowerment requires four kinds of behaviors—leading for (1) meaningfulness, (2) self-determination, (3) competence, and (4) progress.

Leading for meaningfulness: inspiring and modeling desirable behaviors. Managers lead for meaningfulness by inspiring their employees and modeling desired behaviors. Example: Employees may be helped to identify their passions at work by the leader’s creating an exciting organizational vision that employees can connect with emotionally. Employees at drug maker Millennium, for example, are inspired by the company’s vision to cure cancer.56

Leading for self-determination: delegating meaningful tasks. Managers can lead for employee self-determination by delegating meaningful tasks to them. “Delegating is essential,” says Gail Evans, an executive vice president at Atlanta-based CNN. “If you refuse to let your staff handle their own projects, you’re jeopardizing their advancement—because they aren’t learning new skills and adding successes to their resume.”57

Leading for competence: supporting and coaching employees. It goes without saying that employees need to have the necessary knowledge to Page 454perform their jobs. Accomplishing this goal involves managers’ supporting and coaching their employees. Assigning a challenging task will help to fuel workers’ intrinsic motivation, and deficiencies can be handled through training, mentoring, positive feedback, and sincere recognition.

Leading for progress: monitoring and rewarding employees. Managers lead for progress by monitoring and rewarding others. We discussed how to do this in Chapter 12.

One technique used to empower employees is participative management (PM) , the process of involving employees in setting goals, making decisions, solving problems, and making changes in the organization. We consider this further in the Practical Action box.

PRACTICAL ACTION

Participative Management: Empowering Employees to Handle Decision Making

Participatory management (PM) is predicted to increase motivation, innovation, and performance because it helps employees fulfill three basic needs: autonomy, meaningfulness of work, and interpersonal contact.58 Indeed, employees themselves seem to want to participate more in management: In one nationwide survey of 2,408 workers, two-thirds expressed the desire for more influence or decision-making power in their jobs.59 PM can address these needs because it has been shown to increase employee job involvement, organizational commitment, and creativity, and it can lower role conflict and ambiguity.60

Is PM Really Effective? Although participation has a significant effect on job performance and job satisfaction, that effect, unfortunately, is small.61 Accordingly, PM is probably not a quick-fix solution for low productivity and motivation. Nonetheless, it can probably be effective in certain situations, assuming that managers and employees interact constructively—that is, have the kind of relationship that fosters cooperation and respect rather than competition and defensiveness.62

Factors that Can Help Make PM Work. Although participative management doesn’t work in all cases, it can be effective if certain factors are present, such as the following.63

• Top management is continually involved: Implementing PM must be monitored and managed by top management.

• Middle and supervisory managers are supportive: These managers tend to resist PM because it reduces their authority. Thus, it’s important to gain the support and commitment of managers in these ranks.

• Employees trust managers: PM is unlikely to succeed when employees don’t trust management.

• Employees are ready: PM is more effective when employees are properly trained, prepared, and interested in participating.

• Employees don’t work in interdependent jobs: Interdependent employees generally don’t have a broad understanding of the entire production process, so their PM contribution may actually be counterproductive.

• PM is implemented with TQM: A study of Fortune 1000 firms during three different years found employee involvement was more effective when it was implemented as part of a broader total quality management (TQM) program.

Servant Leadership: “I Want to Serve My Subordinates & the Organization, Not Myself” The term servant leadership, coined by Robert Greenleaf in 1970, reflects not only his onetime background as a management researcher for AT&T but also his views as a lifelong philosopher and devout Quaker.64 Servant leadership focuses on providing increased service to others—meeting the goals of both followers and the organization—rather than to oneself.

Servant leadership is not a quick-fix approach to leadership. Rather, it is a long-term, approach to life and work. Ten characteristics of the servant leader are shown opposite. (See Table 14.4 .) One can hardly go wrong by trying to adopt these characteristics.

Page 455TABLE 14.4 Ten Characteristics of the Servant Leader

Source: From L. C. Spears, “Introduction: Servant-Leadership and the Greenleaf Legacy,” in L. C. Spears, ed., Reflections on Leadership: How Robert K. Greenleaf’s Theory of Servant-Leadership Influenced Today’s Top Management (New York: John Wiley & Sons, 1995), pp. 1–14. Reprinted with permission of John Wiley & Sons, Inc.

EXAMPLE

Servant Leadership: Leaders Who Work for the Led

Who are some famous servant leaders?

A Covenant with Customers. John Donahoe, CEO of eBay, thinks of customers first, and employees second. He tries his best to deliver what customers want. For example, reports one article, “on trips around the world he takes along a Flip video camera and films interviews with eBay sellers to share their opinions with his staff. He has even tied managers’ compensation to customer loyalty, measured through regular surveys.”65

A Covenant with Employees. Starbucks CEO Howard Schultz is also cited as being one of the foremost practitioners of servant-style leadership. Schultz has made sure his employees have health insurance and work in a positive environment, and as a result Starbucks has a strong brand following.66 Max De Pree, former chairman of furniture maker Herman Miller Inc., promoted a “covenant” with his employees. Leaders, he wrote, should give employees “space so that we can both give and receive such beautiful things as ideas, openness, dignity, joy, healing, and inclusion.”67

YOUR CALL

Understandably, servant leadership is popular with employees. Can you think of situations in which this kind of leadership role would not be appropriate?

Employees whose manager displays the characteristics shown in Table 14.4 above are likely to be happier, more productive, more creative, and more willing to go above and beyond their customary duties.68 To see how your boss measures up as a servant leader, try taking Self-Assessment 14.3.

SELF-ASSESSMENT 14.3

Assessing Your Boss’s Servant Leadership

The following survey is designed to assess the extent to which a current or former boss displayed servant leadership. Go to connect.mheducation.com and take Self-Assessment 14.3. When you’re done, answer the following questions:

1. Where does the boss stand? Are you surprised by the results?

2. Did you like this boss? Were you satisfied with your job? To what extent do you think your boss’s level of servant leadership affected your attitudes toward the boss and your job?

3. How can you become more of a servant leader? Explain.

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Passive leadership. Do you really hate to get involved in conflict? Do you think you might be tempted to “manage by exception”—not get involved in solving difficult employee problems until you’re forced to, as this executive staring out the window seems to be doing?

Passive Leadership: The Lack of Leadership Skills

Passive leadership is a form of leadership behavior characterized by a lack of leadership skills. For example, in the type of passive leadership called the management-by-exception style, managers do not intervene until problems are brought to their attention or until the problems become serious enough to demand action.69

Another passive type is laissez-faire leadership, a form of “leadership” characterized by a general failure to take responsibility for leading. Not taking responsibility can hardly be considered leadership (although it often seems to be manifested by CEOs whose companies get in trouble, as when they say “I had no idea about the criminal behavior of my subordinates”). Interestingly, laissez-faire (“lay-zay fair”) leadership is seen more in men than women.70

Examples of laissez-faire leadership are seen in various kinds of failure—failing to deal with conflict, to coach employees on difficult assignments, to help set performance goals, to give performance feedback, to deal with bullying, and so on. This passive leadership has a huge negative impact on employee perceptions of leaders—outweighing their positive perceptions of contributions by initiating structure, transactional, and consideration forms of leadership.71

Some Practical Implications of the Behavioral Approaches

Two key conclusions we may take away from the behavioral approaches are the following:

1. A leader’s behavior is more important than his or her traits. It is important to train managers on the various forms of task and relationship leadership.

2. There is no one best style of leadership. How effective a particular leadership behavior is depends on the situation at hand.

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Situational Approaches: Does Leadership Vary with the Situation?

How might effective leadership vary according to the situation at hand?

THE BIG PICTURE

Effective leadership behavior depends on the situation at hand, say believers in two contingency approaches: Fiedler’s contingency leadership model and House’s path–goal leadership model.

Perhaps leadership is not characterized by universally important traits or behaviors. As we noted above, there is no one best style that will work in all situations. This is the point of view of proponents of the situational approach (or contingency approach) to leadership, who believe that effective leadership behavior depends on the situation at hand. That is, as situations change, different styles become appropriate.

Let’s consider two situational approaches: (1) the contingency leadership model by Fiedler and (2) the path–goal leadership model by House.

1. The Contingency Leadership Model: Fiedler’s Approach

The oldest model of the contingency approach to leadership was developed by Fred Fiedler and his associates in 1951.72 The contingency leadership model determines if a leader’s style is (1) task-oriented or (2) relationship-oriented and if that style is effective for the situation at hand. Fiedler’s work was based on 80 studies conducted over 30 years.

Packin’ pecans. Do successful entrepreneurs or small-business managers need to be task-oriented, relationship-oriented, or both? What style of leadership model would best suit a small enterprise in which employees work without the owner always being present?

Two Leadership Orientations: Tasks versus Relationships Are you task-oriented or relationship-oriented? That is, are you more concerned with task accomplishment or with people?

To find out, you or your employees would fill out a questionnaire (known as the least preferred coworker, or LPC, scale), in which you think of the coworker you least enjoyed working with and rate him or her according to an eight-point scale of 16 pairs of opposite characteristics (such as friendly/unfriendly, tense/relaxed, efficient/inefficient). The higher the score, the more the relationship-oriented the respondent; the lower the score, the more task-oriented.

The Three Dimensions of Situational Control Once the leadership orientation is known, then you determine situational control—how much control and influence a leader has in the immediate work environment.

There are three dimensions of situational control: leader-member relations, task structure, and position power.

Leader-member relations—“Do my subordinates accept me as a leader?” This dimension, the most important component of situational control, reflects the extent to which a leader has or doesn’t have the support, loyalty, and trust of the work group.Page 458

Task structure—“Do my subordinates perform unambiguous, easily understood tasks?” This dimension refers to the extent to which tasks are routine, unambiguous, and easily understood. The more structured the jobs, the more influence a leader has.