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Chapter 14Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Chapter 14
Prepared byDeborah Baker
Texas Christian University
Management4th Edition
Chuck Williams
Leadership
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Chapter 14Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
What Would You Do?
The new CEO of Tyco is faced with $28 billion in debt, and the possibilities of bankruptcy
Dennis Kozlowski’s reign as CEO is still embarrassing, when he used funds as his personal piggy bank
43rd Floor, Tyco Headquarters, New York City.
How can you get people to see that with sound management, Tyco can be an exceptional company?
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What Is Leadership?
After reading these sections, you should be able to:
1. explain what leadership is.
2. describe who leaders are and what effectiveleaders do.
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Leadership
DifferencesBetween
Leaders andManagers
DifferencesBetween
Leaders andManagers
Substitutesfor
Leadership
Substitutesfor
Leadership
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Leaders versus Managers
MANAGERS
Do things rightStatus quoShort-term
MeansBuilders
Problem solving
MANAGERS
Do things rightStatus quoShort-term
MeansBuilders
Problem solving
LEADERS
Do the right thingChange
Long-termEnds
ArchitectsInspiring & motivating
LEADERS
Do the right thingChange
Long-termEnds
ArchitectsInspiring & motivating
Adapted from Exhibit 14.1
1.11.1
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Leaders versus Managers
1.11.1
American organizations (and probably those in much of the rest of the industrialized world) are under led
and over managed. They do not pay enoughattention to doing the right thing, while theypay too much attention to doing things right.
--Warren Bennis
American organizations (and probably those in much of the rest of the industrialized world) are under led
and over managed. They do not pay enoughattention to doing the right thing, while theypay too much attention to doing things right.
--Warren Bennis
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Doing the Right Thing
1.11.1
The Three M’s: Mission, Mentor, and Mirror
Business leaders can develop personal ethics by focusing on their mission, a mentor, and the mirror
1. Develop a personal mission statement.
2. Take care in choosing a mentor.
3. Stand in front of the mirror to assess yourethical performance as a business leader.
The Three M’s: Mission, Mentor, and Mirror
Business leaders can develop personal ethics by focusing on their mission, a mentor, and the mirror
1. Develop a personal mission statement.
2. Take care in choosing a mentor.
3. Stand in front of the mirror to assess yourethical performance as a business leader.
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Substitutes for Leadership
Leadership substitutes subordinate, task, or organizational characteristics
that make leaders redundant or unnecessary
Leadership neutralizers subordinate, task, or organizational characteristics
that interfere with a leader’s actions
Leaders don’t always matter Poor leadership is not the cause of every
organizational crisis
1.21.2
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Leadership Substitutes and Neutralizers
Adapted from Exhibit 14.2
1.21.2
Characteristic People-RelatedLeadership Behaviors
Task-RelatedLeadership Behaviors
Subordinate Characteristics Ability, experience, training, knowledge Need for independence Professional orientation Indifference toward organizational rewards
NeutralizeNeutralizeSubstitute, NeutralizeNeutralize
Substitute, NeutralizeNeutralizeSubstitute, NeutralizeNeutralize
Task Characteristics Unambiguous and routine tasks Performance feedback provided by the
work itself Intrinsically satisfying work
No effectNo effect
Substitute, Neutralize
Substitute, NeutralizeSubstitute, Neutralize
Neutralize
Organizational Characteristics Formalization, meaning specific plans,
goals, and areas of responsibility Inflexibility, meaning rigid, unbending rules
and procedures Highly specified staff functions Cohesive work groups Organizational rewards beyond a leader's
control Spatial distance between supervisors and
subordinates
No effect
No effect
No effectSubstitute, NeutralizeNeutralize
Neutralize
Neutralize
Neutralize
NeutralizeSubstitute, NeutralizeNeutralize
Neutralize
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Who Leaders Are and What Leaders Do
Leadership Traits
Leadership Traits
LeadershipBehavior
LeadershipBehavior
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Leadership Traits
LeadershipTraits
Desireto Lead
Honestyand
Integrity
Drive Self-Confidence
EmotionalStability
CognitiveAbility
Knowledgeof the
Business
2.12.1
Adapted from Exhibit 14.3
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What Really Works: Leadership Traits
Intelligence10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success 75%
Dominance10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success 57%
Extroversion10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success 63%
Traits and Perceptionsof Leadership Effectiveness
2.12.1
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What Really Works: Leadership Traits
Charisma and Performance10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success 72%
Charisma and Perceived Leadership Effectiveness10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success 89%
Charisma and Leader Satisfaction10% 20% 30% 40% 50% 60% 70% 80% 90% 100%
probability of success 90%
Charisma and Leadership Effectiveness
2.12.1
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Leadership Behaviors
2.22.2
Initiating Structure
The degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks.
Consideration
The extent to which a leader is friendly, approachable, and supportive and shows concern for employees.
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Blake/Moulton Leadership Grid
1,91,9 Country Club Country Club ManagementManagement
9,9 9,9 Team Team ManagementManagement
1,11,1Impoverished Impoverished ManagementManagement 9,19,1
Authority-Authority-ComplianceCompliance
5,55,5Middle of theMiddle of the
RoadRoad5,55,5
1 2 3 4 5 6 7 8 91
2
3
4
5
6
7
8
9
Adapted from Exhibit 14.4
2.22.2
Co
nce
rn f
or
Peo
ple
Concern for Production
High
Low
Low High
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Situational Approaches to Leadership
After reading these sections, you should be able to:
3. explain Fiedler’s contingency theory.
4. describe how path-goal theory works.
5. discuss Hersey and Blanchard’s Situational Leadership theory.
6. explain the normative decision theory.
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Putting Leaders in the Right Situation:Fiedler’s Contingency Theory
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GroupPerformance
GroupPerformance =
LeadershipStyle
LeadershipStyle
SituationalFavorableness
SituationalFavorableness
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Putting Leaders in the Right Situation:Fiedler’s Contingency Theory
Least Preferred CoworkerLeast Preferred Coworker
Situational FavorablenessSituational Favorableness
Matching Leadership Stylesto Situations
Matching Leadership Stylesto Situations
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Leadership Style:Least Preferred Coworker
Leadership style is the way a leader generally behaves toward followers seen as stable and difficult to change
Style is measured by the Least Preferred Co-worker scale (LPC) relationship-oriented task-oriented
3.13.1
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Leadership Style:Least Preferred Coworker Scale
3.13.1
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Situational Favorableness
3.23.2
Situational Favorableness
The degree to which a particular situation either permits or denies a leader the chance to influence the behavior of group members.
Three factors: Leader-member relations Task structure Position power
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Situational Favorableness
Exhibit 14.7
3.23.2
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Matching Leadership Styles to Situations
Exhibit 14.8
3.33.3
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Path-Goal Theory
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Path-Goal Theory
A leadership theory that states that leaders can increase subordinate satisfaction and performance by clarifying and clearing the paths to goals and by increasing the number and kinds of rewards available for goal attainment.
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Basic Assumptions of Path-Goal Theory
Adapted From Figure 14.9
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Clarify paths to goalsClarify paths to goals
Clear paths to goals by solving problems and removing roadblocks
Clear paths to goals by solving problems and removing roadblocks
Increase the number and kinds of rewardsavailable for goal attainment
Increase the number and kinds of rewardsavailable for goal attainment
Do things that satisfy followers today or will lead to future rewards or satisfaction
Do things that satisfy followers today or will lead to future rewards or satisfaction
Offer followers something unique and valuablebeyond what they’re experiencing
Offer followers something unique and valuablebeyond what they’re experiencing
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Path-Goal Theory
Adapted From Figure 14.10
Subordinate Contingencies•Perceived Ability•Locus of Control•Experience
Subordinate Contingencies•Perceived Ability•Locus of Control•Experience
Environmental Contingencies•Task Structure•Formal Authority System•Primary Work Group
Environmental Contingencies•Task Structure•Formal Authority System•Primary Work Group
Outcomes•Subordinate satisfaction•Subordinate performance
Outcomes•Subordinate satisfaction•Subordinate performance
Leadership Styles•Directive•Supportive•Participative•Achievement-Oriented
Leadership Styles•Directive•Supportive•Participative•Achievement-Oriented
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Adapting Leader Behavior:Path-Goal Theory
LeadershipStyles
LeadershipStyles
Subordinateand
EnvironmentalContingencies
Subordinateand
EnvironmentalContingencies
OutcomesOutcomes
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Leadership Styles
Directive clarifying expectations and guidelines
Supportive being friendly and approachable
Participative allowing input on decisions
Achievement-Oriented setting challenging goals
4.14.1
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Leadership Styles
Martin Winterkorn of Audi uses a directive style. His employees know exactly what is expected of them.
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Subordinate and Environmental Contingencies
Perceived ability
Locus of control
Experience
Perceived ability
Locus of control
Experience
Subordinate Environmental
Task structure
Formal authority system
Primary work group
4.24.2
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Path Goal Theory:When to Use Leadership Styles
Directive Leadership Supportive Leadership Unstructured tasks Inexperienced workers Workers with low perceived ability Workers with external locus of
control Unclear formal authority system
Structured, simple, repetitive tasks
Stressful, frustrating tasks When workers lack confidence Clear formal authority system
Participative Leadership Achievement-Oriented Leadership Experienced workers Workers with high perceived ability Workers with internal locus of
control Workers not satisfied with rewards Complex tasks
Unchallenging tasks
Directive Leadership Supportive Leadership Unstructured tasks Inexperienced workers Workers with low perceived ability Workers with external locus of
control Unclear formal authority system
Structured, simple, repetitive tasks
Stressful, frustrating tasks When workers lack confidence Clear formal authority system
Participative Leadership Achievement-Oriented Leadership Experienced workers Workers with high perceived ability Workers with internal locus of
control Workers not satisfied with rewards Complex tasks
Unchallenging tasks
Adapted from Exhibit 14.11
4.24.2
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Adapting Leadership Behavior
WorkerReadiness
WorkerReadiness
LeadershipStyles
LeadershipStyles
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Hersey and Blanchard’s Situational Leadership Theory
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Worker Readiness
The ability and willingness to take responsibility for directing one’s behavior at work
Components of worker readiness: Job readiness Psychological readiness
5.15.1
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Worker Readiness
R4R4
R3R3
R2 R2
R1R1
confidentwilling able
confidentwilling able
insecurenot willingable
insecurenot willingable
confidentwilling not able
confidentwilling not able
insecure not able not willing
insecure not able not willing
5.15.1
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Leadership Styles
Telling(R1)
Telling(R1)
Selling(R2)
Selling(R2)
Participating(R3)
Participating(R3)
Delegating(R4)
Delegating(R4)
high task behaviorlow relationship behavior
high task behaviorlow relationship behavior
high task behaviorhigh relationship behavior
high task behaviorhigh relationship behavior
low task behaviorhigh relationship behavior
low task behaviorhigh relationship behavior
low task behaviorlow relationship behavior
low task behaviorlow relationship behavior
5.25.2
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Normative Decision Theory
DecisionStyles
DecisionStyles
Decision Quality and Acceptance
Decision Quality and Acceptance
66
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Decision Styles
Adapted from Exhibit 14.12
6.16.1
Solve the problem yourself
Solve the problem yourself
Obtain information.Select a solutionyourself.
Obtain information.Select a solutionyourself.
Share problem,get ideas fromindividuals.Select asolution yourself.
Share problem,get ideas fromindividuals.Select asolution yourself.
AI AII CI
Share problemwith group,get ideas.Make decision,which may ormay not reflectinput.
Share problemwith group,get ideas.Make decision,which may ormay not reflectinput.
Share problemwith group.Together triesto reach a solution. Leader acts asfacilitator.
Share problemwith group.Together triesto reach a solution. Leader acts asfacilitator.
CII GII
Leader solves the problemor makes the decision
Leader accepts any decisionsupported by the entire group
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Decision Quality and Acceptance
Using the right amount of employee participation: improves decision quality improves acceptance
Decision tree helps leader identify
optimal level of participation
6.26.2
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Quality RuleQuality Rule If the quality of the decision is important, then don't use
an autocratic decision style
Leader Information RuleLeader Information Rule If the quality of the decision is important, and if the leader
doesn't have enough information to make the decision on his or her own, then don't use an autocratic decision style
Subordinate Information RuleSubordinate Information Rule If the quality of the decision is important, and if the
subordinates don't have enough information to make the decision themselves, then don't use a group decision style
6.26.2
Normative Theory Decision Rulesto Increase Decision Quality
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Normative Theory Decision Rulesto Increase Decision Quality
Goal Congruence RuleGoal Congruence Rule If the quality of the decision is important, and
subordinates' goals are different from the organization's goals, then don't use a group decision style
Problem Structure RuleProblem Structure Rule If the quality of the decision is important, the leader
doesn't have enough information to make the decision on his or her own, and the problem is unstructured, then don't use an autocratic decision style
6.26.2
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Normative Theory Decision Rulesto Increase Decision Acceptance
Commitment Probability RuleCommitment Probability Rule If having subordinates accept and commit to the decision
is important, then don't use an autocratic decision style
Subordinate Conflict RuleSubordinate Conflict Rule If having subordinates accept the decision is important
and critical to successful implementation and subordinates are likely to disagree or end up in conflict over the decision, then don't use an autocratic or consultative decision style
Commitment Requirement RuleCommitment Requirement Rule If having subordinates accept the decision is absolutely
required for successful implementation and subordinates share the organization's goals, then don't use an autocratic or consultative style
6.26.2
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Chapter 14Copyright ©2007 by South-Western, a division of Thomson Learning. All rights reserved
Strategic Leadership
After reading this section, you should be able to:
7. explain how visionary leadership (i.e., charismatic and transformational leadership) helps leaders achieve strategic leadership.
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Visionary Leadership
CharismaticLeadership
CharismaticLeadership
TransformationalLeadership
TransformationalLeadership
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Charismatic Leadership
Creates an exceptionally strong relationship between leader and follower
Charismatic leaders: articulate a clear vision, based on values model values consistently with vision communicate high performance expectations display confidence in followers’ abilities
7.17.1
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Kinds of Charismatic Leaders
Ethical Charismatics provide developmental opportunities open to positive and negative feedback recognize others’ contributions share information concerned with the interests of the group
Unethical Charismatics control and manipulate followers do what is best for themselves only want positive feedback motivated by self-interest
7.17.1
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Ethical and Unethical Charismatic Leaders
Exercising Power Power is used to serve others
Creating the vision Followers help develop the vision
Communicating with followers
Two-way communication
Accepting feedback Open to feedback
Want followers to think and to questions the status quo
Stimulating followers
Developing followers Focus on developing followers
Living by moral standards
Three virtues: courage, sense of fairness, integrity
Charismatic Leader Charismatic Leader BehaviorsBehaviors
Ethical CharismaticsEthical Charismatics
7.17.1
Adapted from Exhibit 14.15
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Ethical and Unethical Charismatic Leaders
Charismatic Leader Charismatic Leader BehaviorsBehaviors
Unethical CharismaticsUnethical Charismatics
Exercising Power Power is used to dominate others
Creating the vision Vision comes solely from the leader
Communicating with followers
One-way communication, not open to input from others
Accepting feedback Prefer yes-men, punish candid feedback
Don’t want followers to think, prefer uncritical acceptance of own ideas
Stimulating followers
Developing followers Insensitive to followers’ needs
Living by moral standards
Follow standards only if they satisfy immediate self interests
7.17.1
Adapted from Exhibit 14.15
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Reducing Risks of Unethical Charismatics
1. Have a clearly written code of conduct
2. Recruit, select, and promote managers with high ethical standards
3. Train leaders how to value, seek, and used diverse points of view
4. Celebrate and reward those who exhibit ethical behaviors
7.17.1
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Transformational Leadership
Generates awareness and acceptance of group’s purpose and mission
Gets followers to accomplish more than they intended or thought possible
7.27.2
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Components of Transformational Leadership
1. Charisma or idealized influence
2. Inspirational motivation
3. Intellectual stimulation
4. Individualized consideration
7.27.2