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Leadership in Organizations

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E i g h t h E d i t i o n

Leadership in Organizations

Gary Yukl University of Albany

State University of New York

ISBN 10: 0-13-277186-1 ISBN 13: 978-0-13-277186-3

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Library of Congress Cataloging-in-Publication Data

Yukl, Gary A. Leadership in organizations / Gary Yukl. — 8th ed. p. cm. Includes bibliographical references and index. ISBN 978-0-13-277186-3 1. Leadership. 2. Decision making. 3. Organization. I. Title. HD57.7.Y85 2013 303.3'4—dc23

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vii

BRIEF CONTENTS

Preface xv

Chapter 1 Introduction: The Nature of Leadership 1

Chapter 2 Nature of Managerial Work 23

Chapter 3 Effective Leadership Behavior 48

Chapter 4 Leading Change and Innovation 76

Chapter 5 Participative Leadership and Empowerment 105

Chapter 6 Leadership Traits and Skills 135

Chapter 7 Contingency Theories and Adaptive Leadership 162

Chapter 8 Power and Influence Tactics 185

Chapter 9 Dyadic Relations and Followers 221

Chapter 10 Leadership in Teams and Decision Groups 247

Chapter 11 Strategic Leadership in Organizations 276

Chapter 12 Charismatic and Transformational Leadership 309

Chapter 13 Ethical, Servant, Spiritual, and Authentic Leadership 340

Chapter 14 Cross-cultural Leadership and Diversity 360

Chapter 15 Developing Leadership Skills 381

Chapter 16 Overview and Integration 404

References 424

Author Index 483

Subject Index 499

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ix

TABLE OF CONTENTS

Preface xv

Chapter 1 INTRODUCTION: THE NATURE OF LEADERSHIP 1

Definitions of Leadership 2

Indicators of Leadership Effectiveness 8

Major Perspectives in Leadership Theory and Research 10

Level of Conceptualization for Leadership Theories 14

Other Bases for Comparing Leadership Theories 18

Organization of the Book 20

Summary 20 Review and Discussion Questions 21

Chapter 2 NATURE OF MANAGERIAL WORK 23

Activity Patterns for Managers 24

Decision Making and Planning by Managers 26

Managerial Roles 29

Demands, Constraints, and Choices 31

Other Determinants of Managerial Work 34

Limitations of the Descriptive Research 39

Guidelines for Managers 40

Summary 44 Review and Discussion Questions 45

   CASE: Acme Manufacturing Company 45

CHAPTER 3 EFFECTIVE LEADERSHIP BEHAVIOR 48

Ways for Describing Leadership Behavior 48

Major Types of Leadership Behavior 50

Methods for Studying the Effects of Leader Behavior 53

Effects of Task and Relations Behaviors 56

Planning Work Activities 58

Clarifying Roles and Objectives 59

Monitoring Operations and Performance 61

Supportive Leadership 63

Developing Subordinate Skills 65

x Table of Contents

Providing Praise and Recognition 68

Summary 71 Review and Discussion Questions 72 CASE: Consolidated Products 73 CASE: Air Force Supply Squadron 74

CHAPTER 4 LEADING CHANGE AND INNOVATION 76

Types of Change in Teams and Organizations 77

Change Processes 78

Reasons for Accepting or Rejecting Change 80

Implementing Change 81

Guidelines for Implementing Change 84

How Visions Influence Change 89

Collective Learning and Innovation 94

Guidelines for Enhancing Learning and Innovation 98

Summary 101 Review and Discussion Questions 102 CASE: Ultimate Office Products 102

CHAPTER 5 PARTICIPATIVE LEADERSHIP AND EMPOWERMENT 105

Nature of Participative Leadership 106

Research on Effects of Participative Leadership 109

Normative Decision Model 111

Guidelines for Participative Leadership 115

Delegation 118

Guidelines for Delegating 122

Perceived Empowerment 126

Empowerment Programs 128

Summary 130 Review and Discussion Questions 131 CASE: Echo Electronics 132 CASE: Alvis Corporation 133

CHAPTER 6 LEADERSHIP TRAITS AND SKILLS 135

Introduction to the Trait Approach 135

Personality Traits and Effective Leadership 138

Table of Contents xi

Skills and Effective Leadership 148

Managerial Competencies 151

Situational Relevance of Skills 153

Evaluation of the Trait Approach 156

Guidelines for Managers 157

Summary 159 Review and Discussion Questions 159 CASE: National Products 160

CHAPTER 7 CONTINGENCY THEORIES AND ADAPTIVE LEADERSHIP 162

General Description of Contingency Theories 163

Early Contingency Theories 164

Multiple-linkage Model 167

Conceptual Weaknesses in Contingency Theories 173

Research on Contingency Theories 174

Comparative Evaluation of Contingency Theories 175

Guidelines for Adaptive Leadership 177

Guidelines for Managing Immediate Crises 179

Summary 180 Review and Discussion Questions 181 CASE: Foreign Auto Shop 182

CHAPTER 8 POWER AND INFLUENCE TACTICS 185

Power and Influence Concepts 185

Power Sources 188

How Power Is Gained or Lost 193

Consequences of Power 195

Guidelines for Using Power 197

Proactive Influence Tactics 201

Effectiveness of Proactive Tactics 206

Guidelines for Specific Tactics 210

Power and Influence Behavior 215

Summary 216 Review and Discussion Questions 217 CASE: Restview Hospital 218 CASE: Sporting Goods Store 219

xii Table of Contents

CHAPTER 9 DYADIC RELATIONS AND FOLLOWERS 221

Leader-Member Exchange Theory 222

Leader Attributions About Subordinates 225

Leader Influence on Follower Emotions 227

Guidelines for Correcting Performance Deficiencies 227

Follower Attributions and Implicit Theories 231

Impression Management by Leaders and Followers 234

Follower Contributions to Effective Leadership 236

Self-Management 237

Guidelines for Followers 239

Summary 243 Review and Discussion Questions 243 CASE: Cromwell Electronics 244 CASE: American Financial Corporation 245

CHAPTER 10 LEADERSHIP IN TEAMS AND DECISION GROUPS 247

Determinants of Team Performance 248

Functional Work Teams 254

Cross-functional Teams 255

Self-managed Work Teams 258

Virtual Teams 261

Guidelines for Leading Teams 262

Leading Decision Groups 265

Guidelines for Leading Meetings 268

Summary 272 Review and Discussion Questions 273 CASE: Southwest Engineering Services 273

CHAPTER 11 STRATEGIC LEADERSHIP IN ORGANIZATIONS 276

Determinants of Organizational Performance 277

How Leaders Influence Organizational Performance 281

Situations Affecting Strategic Leadership 284

Organizational Culture 286

Research on Effects of Strategic Leadership 289

Table of Contents xiii

Executive Teams 291

Emerging Conceptions of Organizational Leadership 294

Two Key Responsibilities for Top Executives 297

Guidelines for Strategic Leadership 299

Summary 302 Review and Discussion Questions 303 CASE: Costco 303 CASE: Turnaround at Nissan 306

CHAPTER 12 CHARISMATIC AND TRANSFORMATIONAL LEADERSHIP 309

Attribution Theory of Charismatic Leadership 310

Self-Concept Theory of Charismatic Leadership 312

Other Conceptions of Charisma 314

Consequences of Charismatic Leadership 317

Transformational Leadership 321

Research on Charismatic and Transformational Leadership 324

Comparison of Charismatic and Transformational Leadership 328

Evaluation of the Theories 330

Guidelines for Inspirational Leadership 332

Summary 335 Review and Discussion Questions 336 CASE: Astro Airlines 336

CHAPTER 13 ETHICAL, SERVANT, SPIRITUAL, AND AUTHENTIC LEADERSHIP 340

Conceptions of Ethical Leadership 341

Dilemmas in Assessing Ethical Leadership 342

Determinants and Consequences of Ethical Leadership 344

Theories of Ethical Leadership 347

Evaluation of Ethical Leadership Theories 352

Guidelines for Ethical Leadership 354

Summary 357 Review and Discussion Questions 358 CASE: Unethical Leadership at Enron 358

xiv Table of Contents

CHAPTER 14 CROSS-CULTURAL LEADERSHIP AND DIVERSITY 360

Introduction to Cross-cultural Leadership 361

Cultural Value Dimensions and Leadership 365

Evaluation of Cross-cultural Research 368

Gender and Leadership 370

Managing Diversity 376

Summary 378 Review and Discussion Questions 379 CASE: Madison, Jones, and Conklin 379

CHAPTER 15 DEVELOPING LEADERSHIP SKILLS 381

Leadership Training Programs 382

Learning from Experience 384

Developmental Activities 385

Facilitating Conditions for Leadership Development 396

Systems Perspective on Leadership Development 398

Summary 401 Review and Discussion Questions 402 CASE: Federated Industries 402

CHAPTER 16 OVERVIEW AND INTEGRATION 404

Major Findings About Effective Leadership 404

Multilevel Explanatory Processes 408

Toward an Integrating Conceptual Framework 415

Limitations in Leadership Research 417

Concluding Thoughts 421 Review and Discussion Questions 423

References 424

Author Index 483

Subject Index 499

xv

PREFACE

This book is about leadership in organizations. Its primary focus is on managerial leadership as opposed to parliamentary leadership, leadership of social movements, or emergent leadership in informal groups. The book presents a broad survey of theory and research on leadership in for- mal organizations. Topics of special interest are the determinants of leadership effectiveness and how leadership can be improved.

In this 8th edition, the following improvements were made to make the book easier to un- derstand and more useful to most readers:

• Most chapters were revised for clarity and understanding (including Chapters 2 , 3 , 4 , 6 , 7 , 9 , 10 , 12 , 15 , and 16 ).

• The order of Chapters 4 to 12 was modified to improve explanation of related topics. • Several new examples of effective and ineffective leadership were added to Chapters 4 , 6 ,

11 , 13 , and 14 . • More practical guidelines for effective leadership were added to Chapters 3 , 6 , 7 , and 8 . • Several new examples were used in Chapters 3 , 11 , 12 , and 14 to explain how research is

conducted. • Over 100 citations to recent research were added throughout.

The basic structure of most chapters remains the same, but the order of some chapters was changed and a few topics were moved to a different chapter. Citations to relevant recent literature were updated, but given the increasing volume of studies on leadership, the citations are still selec- tive rather than comprehensive. Since the book is not intended to be a history of leadership, it seemed appropriate to reduce the amount of detail about early research programs and old theories that are no longer popular, and focus more closely on what we now know about effective leadership.

The content of the book still reflects a dual concern for theory and practice. I have attempted to satisfy two different audiences with somewhat different preferences. Most academics prefer a book that explains and evaluates major theories and relevant empirical research. They are more interested in how well the research was done, what was found, and what additional research is needed than in the practical applications. Academics tend to be skeptical about the value of pre- scriptions and guidelines for practitioners and consider them premature in the absence of further research. In contrast, most practitioners want some immediate answers about what to do and how to do it in order to be more effective as leaders. They need to deal with the current challenges of their job and cannot wait for decades until the academics resolve their theoretical disputes and ob- tain definitive answers. Practitioners are more interested in finding helpful remedies and prescrip- tions than in finding out how this knowledge was discovered. Readers who desire to improve their leadership effectiveness will find this edition of the book is even more useful than previous editions.

These different preferences are a one of the reasons for the much-lamented gulf between scientists and practitioners in management and industrial-organizational psychology. I believe it is important for managers and administrators to understand the complexity of effective leader- ship, the source of our knowledge about leadership in organizations, and the limitations of this knowledge. Likewise, I believe it is important for academics to think more about how their theories and research can be used to improve the practice of management. Too much of our leadership research is designed to examine narrow, esoteric questions that only interest a few other scholars who publish in the same journals.

xvi Preface

Academics will be pleased to find that major theories are explained and evaluated, findings in empirical research on leadership are summarized, and many references are provided to help readers find sources of additional information about topics of special interest. The field of lead- ership is still in a state of ferment, with many continuing controversies about conceptual and methodological issues. The book addresses these issues whenever feasible. However, the litera- ture review was intended to be incisive, not comprehensive. Rather than detailing an endless series of studies like most handbooks of leadership, the book describes major findings about ef- fective leadership. The current edition reflects significant progress in our understanding of lead- ership since the first edition was published in 1981.

For practitioners and students who desire to become effective managers, I attempted to convey a better appreciation of the complexity of managerial leadership, the importance of hav- ing theoretical knowledge about leadership, and the need to be flexible and pragmatic in applying this knowledge. The current edition provides many guidelines and recommendations for im- proving managerial effectiveness, but it is not a “practitioner’s manual” of simple techniques and secret recipes that guarantee instant success. The purpose of the guidelines is to help the reader understand the practical implications of the leadership theory and research, not to prescribe ex- actly how things must be done by a leader. Most of the guidelines are based on a limited amount of research and they are not infallible or relevant for all situations. Being a flexible, adaptive leader includes determining which guidelines are relevent for each unique situation.

Most chapters have one or two short cases designed to help the reader gain a better under- standing of the theories, concepts, and guidelines presented in the chapter. The cases describe events that occurred in real organizations, but some of the cases were modified to make them more useful for learning basic concepts and effective practices. For most of the cases, the names of organizations and individuals were changed to keep the analysis focused on the events that oc- curred in a defined time period, not on recent events that may involve different leaders and a new context. The cases ask a reader to analyze behavioral processes, identify examples of effective and ineffective behavior, and suggest effective ways to handle the situation that is depicted.

An instructor’s manual is available with detailed analyses of the cases and suggestions on how to use them. The instructor’s manual also includes additional cases, exercises for use in class (e.g., role plays), and some out-of-class activities that help students to understand how they can apply the theory and guidelines. Finally, a test bank is available with multiple-choice items on the major points in each chapter.

The book is widely used in many different countries, and some editions have been translated into other languages, including Chinese, Korean, Indonesian, Spanish, Greek, Croatian, and Swedish. With its focus on effective leadership in organizations, the book is especially relevant for people who expect to become a manager or administrator in the near future, for people who will be responsible for training or coaching leaders, and for people who will be teaching courses or work- shops that include leadership as one of the key topics. The book is appropriate for use as the primary text in an undergraduate or graduate course in leadership. Such courses are found in many different schools or departments, including business, psychology, sociology, educational administration, public administration, and health care administration. The book is on the list of required or recommended readings for students in many doctoral programs in leadership, management, and industrial- organizational psychology. Finally, the book is also useful for practicing managers and consultants who are looking for something more than superficial answers to difficult questions about leadership.

Gary Yukl Albany, New York

June, 2011

1

Chapter 1

Learning Objectives After studying this chapter, you should be able to:

■ Understand the different ways leadership has been defined. ■ Understand the controversy about differences between leadership and management. ■ Understand why it is so difficult to assess leadership effectiveness. ■ Understand the different indicators used to assess leadership effectiveness. ■ Understand what aspects of leadership have been studied the most during the past 50 years. ■ Understand the organization of this book.

Leadership is a subject that has long excited interest among people. The term connotes images of powerful, dynamic individuals who command victorious armies, direct corporate empires from atop gleaming skyscrapers, or shape the course of nations. The exploits of brave and clever leaders are the essence of many legends and myths. Much of our description of history is the story of military, political, religious, and social leaders who are credited or blamed for important historical events, even though we do not understand very well how the events were caused or how much influence the leader really had. The widespread fascination with leadership may be because it is such a mysterious process, as well as one that touches everyone’s life. Why did certain leaders (e.g., Gandhi, Mohammed, Mao Tse-tung) inspire such intense fervor and dedi- cation? How did certain leaders (e.g., Julius Caesar, Alexander the Great) build great empires? Why did some rather undistinguished people (e.g., Adolf Hitler, Claudius Caesar) rise to posi- tions of great power? Why were certain leaders (e.g., Winston Churchill, Indira Gandhi) sud- denly deposed, despite their apparent power and record of successful accomplishments? Why do some leaders have loyal followers who are willing to sacrifice their lives, whereas other lead- ers are so despised that subordinates conspire to murder them?

Introduction: Th e Nature of Leadership

2 Chapter 1 • Introduction: The Nature of Leadership

Questions about leadership have long been a subject of speculation, but sci- entific research on leadership did not begin until the twentieth century. The focus of much of the research has been on the determinants of leadership effectiveness. Social scientists have attempted to discover what traits, abilities, behaviors, sources of power, or aspects of the situation determine how well a leader is able to influence followers and accomplish task objectives. There is also a growing interest in understanding leadership as a shared pro- cess in a team or organization and the reasons why this process is effective or ineffective. Other important questions include the reasons why some people emerge as leaders, and the determi- nants of a leader’s actions, but the predominant concern has been leadership effectiveness.

Some progress has been made in probing the mysteries surrounding leadership, but many questions remain unanswered. In this book, major theories and research findings on leader- ship effectiveness will be reviewed, with particular emphasis on managerial leadership in formal organizations such as business corporations, government agencies, hospitals, and universi- ties. This chapter introduces the subject by considering different conceptions of leadership, dif- ferent ways of evaluating its effectiveness, and different approaches for studying leadership. The chapter also provides an overview of the book and explains how subjects are organized.

Definitions of Leadership

The term leadership is a word taken from the common vocabulary and incorporated into the technical vocabulary of a scientific discipline without being precisely redefined. As a consequence, it carries extraneous connotations that create ambiguity of meaning (Janda, 1960). Additional confusion is caused by the use of other imprecise terms such as power , author- ity , management , administration , control , and supervision to describe similar phenomena. An observation by Bennis (1959, p. 259) is as true today as when he made it many years ago:

Always, it seems, the concept of leadership eludes us or turns up in another form to taunt us again with its slipperiness and complexity. So we have invented an endless proliferation of terms to deal with it . . . and still the concept is not sufficiently defined.

Researchers usually define leadership according to their individual perspectives and the as- pects of the phenomenon of most interest to them. After a comprehensive review of the leadership literature, Stogdill (1974, p. 259) concluded that “there are almost as many definitions of leadership as there are persons who have attempted to define the concept.” The stream of new definitions has continued unabated since Stogdill made his observation. Leadership has been defined in terms of traits, behaviors, influence, interaction patterns, role relationships, and occupation of an adminis- trative position. Table 1-1 shows some representative definitions presented over the past 50 years.

Most definitions of leadership reflect the assumption that it involves a process whereby in- tentional influence is exerted over other people to guide, structure, and facilitate activities and rela- tionships in a group or organization. The numerous definitions of leadership appear to have little else in common. They differ in many respects, including who exerts influence, the intended pur- pose of the influence, the manner in which influence is exerted, and the outcome of the influence attempt. The differences are not just a case of scholarly nit-picking; they reflect deep disagreement about identification of leaders and leadership processes. Researchers who differ in their concep- tion of leadership select different phenomena to investigate and interpret the results in different ways. Researchers who have a very narrow definition of leadership are less likely to discover things that are unrelated to or inconsistent with their initial assumptions about effective leadership.

Chapter 1 • Introduction: The Nature of Leadership 3

Because leadership has so many different meanings to people, some theorists question whether it is even useful as a scientific construct (e.g., Alvesson & Sveningsson, 2003; Miner, 1975). Nevertheless, most behavioral scientists and practitioners seem to believe leadership is a real phenomenon that is important for the effectiveness of organizations. Interest in the subject con- tinues to increase, and the deluge of articles and books about leadership shows no sign of abating.

Specialized Role or Shared Influence Process?

A major controversy involves the issue of whether leadership should be viewed as a special- ized role or as a shared influence process. One view is that all groups have role specialization, and the leadership role has responsibilities and functions that cannot be shared too widely without jeopardizing the effectiveness of the group. The person with primary responsibility to perform the specialized leadership role is designated as the “leader.” Other members are called “followers” even though some of them may assist the primary leader in carrying out leadership functions. The distinction between leader and follower roles does not mean that a person cannot perform both roles at the same time. For example, a department manager who is the leader of department employees is also a follower of higher-level managers in the organization. Researchers who view leadership as a specialized role are likely to pay more attention to the attributes that determine selection of designated leaders, the typical behavior of designated leaders, and the effects of this behavior on other members of the group or organization.

Another way to view leadership is in terms of an influence process that occurs naturally within a social system and is diffused among the members. Writers with this perspective believe it is more useful to study “leadership” as a social process or pattern of relationships rather than as a specialized role. According to this view, various leadership functions may be carried out by dif- ferent people who influence what the group does, how it is done, and the way people in the group relate to each other. Leadership may be exhibited both by formally selected leaders and by infor- mal leaders. Important decisions about what to do and how to do it are made through the use of an interactive process involving many different people who influence each other. Researchers who view leadership as a shared, diffuse process, are likely to pay more attention to the complex

TABLE 1-1 Definitions of Leadership • Leadership is “the behavior of an individual . . . directing the activities of a group toward a

shared goal” (Hemphill & Coons, 1957, p. 7). • Leadership is “the influential increment over and above mechanical compliance with the

routine directives of the organization” (Katz & Kahn, 1978, p. 528). • Leadership is “the process of influencing the activities of an organized group toward goal

achievement” (Rauch & Behling, 1984, p. 46). • “Leadership is about articulating visions, embodying values, and creating the environment

within which things can be accomplished” (Richards & Engle, 1986, p. 206). • “Leadership is a process of giving purpose (meaningful direction) to collective effort, and

causing willing effort to be expended to achieve purpose” (Jacobs & Jaques, 1990, p. 281). • Leadership “is the ability to step outside the culture . . . to start evolutionary change processes

that are more adaptive” (Schein, 1992, p. 2). • “Leadership is the process of making sense of what people are doing together so that people

will understand and be committed” (Drath & Palus, 1994, p. 4). • Leadership is “the ability of an individual to influence, motivate, and enable others to contribute

toward the effectiveness and success of the organization . . .” (House et al., 1999, p. 184).

4 Chapter 1 • Introduction: The Nature of Leadership

influence processes that occur among members, the context and conditions that determine when and how they occur, the processes involved in the emergence of informal leaders, and the conse- quences for the group or organization.

Type of Influence Process

Controversy about the definition of leadership involves not only who exercises influence, but also what type of influence is exercised and the outcome. Some theorists would limit the definition of leadership to the exercise of influence resulting in enthusiastic commitment by fol- lowers, as opposed to indifferent compliance or reluctant obedience. These theorists argue that the use of control over rewards and punishments to manipulate or coerce followers is not really “leading” and may involve the unethical use of power.

An opposing view is that this definition is too restrictive because it excludes some influ- ence processes that are important for understanding why a leader is effective or ineffective in a given situation. How leadership is defined should not predetermine the answer to the research question of what makes a leader effective. The same outcome can be accomplished with differ- ent influence methods, and the same type of influence attempt can result in different outcomes, depending on the nature of the situation. Even people who are forced or manipulated into doing something may become committed to it if they subsequently discover that it really is the best op- tion for them and the organization. The ethical use of power is a legitimate concern for leader- ship scholars, but it should not limit the definition of leadership or the type of influence processes that are studied.

Purpose of Influence Attempts

Another controversy about which influence attempts are part of leadership involves their purpose and outcome. One viewpoint is that leadership occurs only when people are influenced to do what is ethical and beneficial for the organization and themselves. This definition of lead- ership does not include influence attempts that are irrelevant or detrimental to followers, such as a leader’s attempts to gain personal benefits at the follower’s expense.

An opposing view would include all attempts to influence the attitudes and behavior of fol- lowers in an organizational context, regardless of the intended purpose or actual beneficiary. Acts of leadership often have multiple motives, and it is seldom possible to determine the extent to which they are selfless rather than selfish. The outcomes of leader actions usually include a mix of costs and benefits, some of which are unintended, making it difficult to infer purpose. Despite good intentions, the actions of a leader are sometimes more detrimental than beneficial for fol- lowers. Conversely, actions motivated solely by a leader’s personal needs sometimes result in un- intended benefits for followers and the organization. Thus, the domain of leadership processes to study should not be limited by the leader’s intended purpose.

Influence Based on Reason or Emotions

Most of the leadership definitions listed earlier emphasize rational, cognitive processes. For many years, it was common to view leadership as a process wherein leaders influence followers to believe it is in their best interest to cooperate in achieving a shared task objective. Until the 1980s, few conceptions of leadership recognized the importance of emotions as a basis for influence.

In contrast, some recent conceptions of leadership emphasize the emotional aspects of in- fluence much more than reason. According to this view, only the emotional, value-based aspects of leadership influence can account for the exceptional achievements of groups and organizations.

Chapter 1 • Introduction: The Nature of Leadership 5

Leaders inspire followers to willingly sacrifice their selfish interests for a higher cause. For exam- ple, leaders can motivate soldiers to risk their lives for an important mission or to protect their comrades. The relative importance of rational and emotional processes and how they interact are issues to be resolved by empirical research, and the conceptualization of leadership should not exclude either type of process.

Direct and Indirect Leadership

Most theories about effective leadership focus on behaviors used to directly influence immediate subordinates, but a leader can also influence other people inside the organization, including peers, bosses, and people at lower levels who do not report to the leader. Some theo- rists make a distinction between direct and indirect forms of leadership to help explain how a leader can influence people when there is no direct interaction with them (Hunt, 1991; Lord & Maher, 1991; Yammarino, 1994).

A chief executive officer (CEO) has many ways to influence people at lower levels in the or- ganization. Direct forms of leadership involve attempts to influence followers when interacting with them or using communication media to send messages to them. Examples include send- ing memos or reports to employees, sending e-mail messages, presenting speeches on television, holding meetings with small groups of employees, and participating in activities involving em- ployees (e.g., attending orientation or training sessions, company picnics). Most of these forms of influence can be classified as direct leadership.

Indirect leadership has been used to describe how a chief executive can influence people at lower levels in the organization who do not interact directly with the leader (Bass, Waldman, Avolio, & Bebb, 1987; Waldman & Yammarino, 1999; Yammarino, 1994). One form of indirect leadership by a CEO is called “cascading.” It occurs when the direct influence of the CEO is trans- mitted down the authority hierarchy of an organization from the CEO to middle managers, to lower- level managers, to regular employees. The influence can involve changes in employee attitudes, beliefs, values, or behaviors. For example, a CEO who sets a good example of ethical and sup- portive behavior may influence similar behavior by employees at lower levels in the organization.

Another form of indirect leadership involves influence over formal programs, management systems, and structural forms (Hunt, 1991; Lord & Maher, 1991; Yukl & Lepsinger, 2004). Many large organizations have programs or management systems intended to influence the attitudes, skills, behavior, and performance of employees. Examples include programs for recruitment, selection, and promotion of employees. Structural forms and various types of programs can be used to increase control, coordination, efficiency, and innovation. Examples include formal rules and procedures, specialized subunits, decentralized product divisions, standardized facilities, and self-managed teams. In most organizations only top executives have sufficient authority to im- plement new programs or change the structural forms (see Chapter 11 ).

A third form of indirect leadership involves leader influence over the organization cul- ture, which is defined as the shared beliefs and values of members (Schein, 1992; Trice & Beyer, 1991). Leaders may attempt either to strengthen existing cultural beliefs and values or to change them. There are many ways for leaders to influence an organization’s culture. Some ways involve direct influence (e.g., communicating a compelling vision or leading by example), and some in- volve forms of indirect influence, such as changing the organizational structure, reward systems, and management programs (see Chapter 11 ). For example, a CEO can implement programs to re- cruit, select, and promote people who share the same values (Giberson, Resick, & Dickson, 2005).

The interest in indirect leadership is useful to remind scholars that leadership influence is not limited to the types of observable behavior emphasized in many leadership theories. However,

6 Chapter 1 • Introduction: The Nature of Leadership

it is important to remember that a simple dichotomy does not capture the complexity involved in these influence processes. Some forms of influence are not easily classified as either direct or indirect leadership. Moreover, direct and indirect forms of influence are not mutually exclusive, and when used together in a consistent way, it is possible to magnify their effects (see Chapter 11 ).

Leadership or Management

There is a continuing controversy about the difference between leadership and manage- ment. It is obvious that a person can be a leader without being a manager (e.g., an informal leader), and a person can be a manager without leading. Indeed, some people with the job title “manager” do not have any subordinates (e.g., a manager of financial accounts). Nobody has proposed that managing and leading are equivalent, but the degree of overlap is a point of sharp disagreement.

Some writers contend that leadership and management are qualitatively different and mutu- ally exclusive (e.g., Bennis & Nanus, 1985; Zaleznik, 1977). The most extreme distinction assumes that management and leadership cannot occur in the same person. For these writers, leaders and managers differ with regard to their values and personalities. Managers value stability, order, and ef- ficiency, and they are impersonal, risk-averse, and focused on short-term results. Leaders value flex- ibility, innovation, and adaptation; they care about people as well as economic outcomes, and they have a longer-term perspective with regard to objectives and strategies. Managers are concerned about how things get done, and they try to get people to perform better. Leaders are concerned with what things mean to people, and they try to get people to agree about the most important things to be done. Bennis and Nanus (1985, p. 21) proposed that “managers are people who do things right, and leaders are people who do the right thing.” However, the empirical research does not support the assumption that people can be sorted neatly into these two extreme stereotypes. Moreover, the stereotypes imply that managers are generally ineffective. The term manager is an occupational title for a large number of people, and it is insensitive to denigrate them with a negative stereotype.

Other scholars view leading and managing as distinct processes or roles, but they do not as- sume that leaders and managers are different types of people (Bass, 1990; Hickman, 1990; Kotter, 1988; Mintzberg, 1973; Rost, 1991). How the two processes are defined varies somewhat, de- pending on the scholar. For example, Mintzberg (1973) described leadership as one of the 10 managerial roles (see Chapter 2 ). Leadership includes motivating subordinates and creating fa- vorable conditions for doing the work. The other nine roles (e.g., resource allocator, negotiator) involve distinct managing responsibilities, but leadership is viewed as an essential managerial role that pervades the other roles.

Kotter (1990) proposed that managing seeks to produce predictability and order, where- as leading seeks to produce organizational change. Both roles are necessary, but problems can occur if an appropriate balance is not maintained. Too much emphasis on the managing role can discourage risk taking and create a bureaucracy without a clear purpose. Too much emphasis on the leadership role can disrupt order and create change that is impractical. According to Kotter, the importance of leading and managing depends in part on the situation. As an organization becomes larger and more complex, managing becomes more important. As the external envi- ronment becomes more dynamic and uncertain, leadership becomes more important. Both roles are important for executives in large organizations with a dynamic environment. When Kotter surveyed major large companies in a dynamic environment, he found very few had executives who were able to carry out both roles effectively.

Rost (1991) defined management as an authority relationship that exists between a man- ager and subordinates to produce and sell goods and services. He defined leadership as a

Chapter 1 • Introduction: The Nature of Leadership 7

multidirectional influence relationship between a leader and followers with the mutual purpose of accomplishing real change. Leaders and followers influence each other as they interact in non- coercive ways to decide what changes they want to make. Managers may be leaders, but only if they have this type of influence relationship. Rost proposed that leading was not necessary for a manager to be effective in producing and selling goods and services. However, leading is essen- tial when major changes must be implemented in an organization, because authority is seldom a sufficient basis for gaining commitment from subordinates or for influencing other people whose cooperation is necessary, such as peers and outsiders.

Defining managing and leading as distinct roles, processes, or relationships may obscure more than it reveals if it encourages simplistic theories about effective leadership. Most scholars seem to agree that success as a manager or administrator in modern organizations also involves leading. How to integrate the two processes has emerged as a complex and important issue in organizational literature (Yukl & Lepsinger, 2005). The answer will not come from debates about ideal definitions. Questions about what to include in the domain of essential leadership pro- cesses should be explored with empirical research, not predetermined by subjective judgments.

A Working Definition of Key Terms

It is neither feasible nor desirable at this point in the development of the discipline to attempt to resolve the controversies over the appropriate definition of leadership. Like all con- structs in social science, the definition of leadership is arbitrary and subjective. Some definitions are more useful than others, but there is no single “correct” definition that captures the essence of leadership. For the time being, it is better to use the various conceptions of leadership as a source of different perspectives on a complex, multifaceted phenomenon.

In research, the operational definition of leadership depends to a great extent on the pur- pose of the researcher (Campbell, 1977). The purpose may be to identify leaders, to determine how they are selected, to discover what they do, to discover why they are effective, or to deter- mine whether they are necessary. As Karmel (1978, p. 476) notes, “It is consequently very dif- ficult to settle on a single definition of leadership that is general enough to accommodate these many meanings and specific enough to serve as an operationalization of the variable.” Whenever feasible, leadership research should be designed to provide information relevant to a wide range of definitions, so that over time it will be possible to compare the utility of different conceptions and arrive at some consensus on the matter.

In this book, leadership is defined broadly in a way that takes into account several things that determine the success of a collective effort by members of a group or organization to accom- plish meaningful tasks. The following definition is used:

Leadership is the process of influencing others to understand and agree about what needs to be done and how to do it, and the process of facilitating individual and collective efforts to accomplish shared objectives.

The definition includes efforts not only to influence and facilitate the current work of the group or organization, but also to ensure that it is prepared to meet future challenges. Both di- rect and indirect forms of influence are included. The influence process may involve only a sin- gle leader or it may involve many leaders. Table 1-2 shows the wide variety of ways leaders can influence the effectiveness of a group or organization.

In this book, leadership is treated as both a specialized role and a social influence process. More than one individual can perform the role (i.e., leadership can be shared or distributed), but

8 Chapter 1 • Introduction: The Nature of Leadership

some role differentiation is assumed to occur in any group or organization. Both rational and emo- tional processes are viewed as essential aspects of leadership. No assumptions are made about the actual outcome of the influence processes, because the evaluation of outcomes is difficult and sub- jective. Thus, the definition of leadership is not limited to processes that necessarily result in “suc- cessful” outcomes. How leadership processes affect outcomes is a central research question that should not be biased by the definition of leadership. The focus is clearly on the process, not the per- son, and they are not assumed to be equivalent. Thus, the terms leader , manager , and boss are used interchangeably in this book to indicate people who occupy positions in which they are expected to perform the leadership role, but without any assumptions about their actual behavior or success.

The terms subordinate and direct report are used interchangeably to denote someone whose primary work activities are directed and evaluated by the focal leader. Some writers use the term staff as a substitute for subordinate, but this practice creates unnecessary confusion. The term con- notes a special type of advisory position, and most subordinates are not staff advisors. Moreover, the term staff is used both as a singular and plural noun, which creates a lot of unnecessary con- fusion. The term associate has become popular in business organizations as another substitute for subordinate, because it conveys a relationship in which employees are valued and supposedly empowered. However, this vague term fails to differentiate between a direct authority relationship and other types of formal relationships (e.g., peers, partners). To clarify communication, this text continues to use the term subordinate to denote the existence of a formal authority relationship.

The term follower is used to describe a person who acknowledges the focal leader as the primary source of guidance about the work, regardless of how much formal authority the leader actually has over the person. Unlike the term subordinate , the term follower does not pre- clude leadership processes that can occur even in the absence of a formal authority relation- ship. Followers may include people who are not direct reports (e.g., coworkers, team members, partners, outsiders). However, the term follower is not used to describe members of an organi- zation who completely reject the formal leader and seek to remove the person from office; such people are more appropriately called “rebels” or “insurgents.”

Indicators of Leadership Effectiveness Like definitions of leadership, conceptions of leader effectiveness differ from one writer to

another. The criteria selected to evaluate leadership effectiveness reflect a researcher’s explicit or implicit conception of leadership. Most researchers evaluate leadership effectiveness in terms of the consequences of influence on a single individual, a team or group, or an organization.