Leadership

DEFINITION

• It is the process of encouraging & helping others to work enthusiastically towards objectives.

• It can also be defined as the relationship in which one person (the leader) influences others to work together willingly on related tasks to attain goals desired by the leader and/or group.

Difference between leaders & managers

Leaders

• Innovate

• Develop

• Inspire

• Long term view

• Ask what & why

• Originate

• Do the right things

Managers

• Administer

• Maintain

• Control

• Short term view

• Ask how & when

• Initiate

• Do things right

IMPORTANCE OF LEADERSHIP

FORMAL & INFORMAL LEADERSHIP

• Formal leadership occurs when a manager leads by exercising formal authority.

• Any employee who is assigned a managerial position has the opportunity & responsibility to exercise formal leadership in relation to subordinates.

• Informal leadership arises when a person without formal authority is influential in directing the behaviour of others.

• Although not formally appointed or elected, he becomes a leader through his actions or personal attractions.

LEADERSHIP STYLES

• The behaviour the leader exhibits during supervision of subordinates is known as leadership style.

• It is divided into 4 types –a) Styles based on the amount of authority retained by

the leader.b) Styles based on the relative emphasis placed on the

task to be performed versus that placed on people.c) Styles based on the assumptions about people made

by the leader.Likert’s 4 styles

Entrepreneurial Leadership Style

Styles based on authority retained

Autocratic (Authoritarian)• Manager retains power

• Manager is decision-making authority

• Manager does not consult employees for inputs

• Subordinates expected to obey orders without explanations

When to use Autocratic

• New, untrained employees

• Employees do not respond to any other leadership style

• High-volume production required

• Limited time for decision making

• Manager’s power is challenged by an employee

PARTICIPATIVE STYLE

a) Consultative leaders - Solicit opinions from group before making a decision. These leaders make it clear that they alone have final authority to make final decisions.

b) Consensual leaders – Encourage group discussion on an issue & then make a decision that reflects the general agreement (consensus) of group members. Leads to considerable delay in decision making because every member has to give his/her consent.

C ) Democratic leaders They function as collectors of opinion & take a vote before making a decision.

Free rein style

• Also called Laissez – faire, free rein leader chooses not to adopt a leadership role.

• It works when the group is composed of highly committed members.

STYLES BASED ON TASK VERSUS PEOPLE EMPHASIS

Styles based on assumptions about people

LIKERT’S 4 STYLES

• Exploitative authoritarian - Leader uses sanctions, communication is downward, superiors & subordinates are psychologically distant, & the decisions are generally made at the top of the organisation.

• Benevolent authoritarian – Leader uses rewards to encourage performance, upward communication is permitted but to the extent the boss wants. Major decisions are made by the people at the top of the hierarchy.

• Consultative – Leader uses reward, subordinates are involved in decision making in a limited way.

• Participative – Subordinates & superiors are psychologically close, group decision making is widespread in the organisation. There is a tendency among a number of individuals to belong to more than one work group in order to promote inter- group links & understanding.

Entrepreneurship leadership style

• Impatience towards employees because the entrepreneur is always busy.

• A charismatic personality that inspires others to want to do business with him or her despite the impatience.

• A much stronger interest in dealing with customers than employees.

THEORIES OF LEADERSHIP

• Trait theory

• Leader Behaviour Theory

• Managerial Grid

• Contingency Theory

• Theory X & Theory Y of McGregor

TRAIT APPROACH

• Trait theories of leadership focus on the individual characteristics of successful leaders.

• According to the theories, leaders possess a set of traits which make them distinct from followers.

Ralph Stogdill, surveyed more than 5,000 leadership studies & concluded that successful leaders tend to have the following qualities –

• A strong desire for accomplishment• Persistent pursuit of goals• Creativity & Intelligence used to solve problems.• Initiative applied to social situations• Willingness to accept behavioural consequences.• Low susceptibility to interpersonal stress• Ability to influence other people

BEHAVIOURAL THEORIES

• Ohio State University Studies

• University of Michigan Studies

Ohio State University Studies

• Main objective was to identify the major dimensions of leadership & to investigate the effect of leader behaviour on employee performance & satisfaction.

• 2 leadership dimensions were identified –

a) Initiating structure which refers to leader behaviour that defines & organises the group tasks, assigns the tasks to employees & supervises their activities.

b) Consideration refers to leader behaviourthat can be characterised by friendliness, respect, supportiveness, openness, trust, & concern for the welfare of the employees.

UNIVERSITY OF MICHIGAN STUDIES

• 2 dimensions of leadership

• Production centered – leaders set rigid work standards, organised tasks down to the last detail, prescribe the work methods to be followed & closely supervised subordinates performance.

• Employee centered leaders – encouraged employee participation in goal setting & in other work related decisions & helped ensure high performance by inspiring. Respect & trust.

MANAGERIAL GRID

• The managerial grid model (1964) is a situational leadership model developed by Robert R. Blake and Jane Mouton.

• This model originally identified five different leadership styles based on the concern for people and the concern for production

CONTINGENCY THEORIES OF LEADERSHIP

• It became increasingly clear for people studying the leadership phenomenon that predicting leadership effectiveness was more complex than identifying a few traits or preferable behaviours.

• The failure to obtain consistent results led to a focus on situational or contingency theories of leadership.

PATH GOAL THEORY OF LEADERSHIP

• Developed by Robert House

• Essence of the theory is that the leader’s job is to use structure, support & rewards to create a work environment that helps employees reach the organisation’s goals.

• According to the theory, the leader must clarify goals for the subrodinates & clear the path for realising the goals.

• The theory is called path goal because its major concern is how the leader influences the subordinates’ perceptions of their work goals, personal goals & paths to goal attainment.

• Locus of control - extent to which individuals believe that they can control events that affect them.

Situational theory of leadership

• By Paul Hersey & Kenneth Blanchard

• Maturity – Desire for achievement, willingness to accept responsibility, task related ability & experience.

Mcgregor’s theory x & theory y

• Theory X by McGregor had the following assumptions –

1. Employees are inherently lazy & will avoid work unless forced to do it.

2. Employees have no ambition or desire for responsibility, instead they prefer to be directed & controlled.

3. Employees have no motivation to achieve organisational objectives.

4. Employees are only motivated by physiological & safety needs.

• Theory Y by McGregor had the following assumptions –

1. Employees find work as natural as play if organisational conditions are appropriate. People appear averse to work only because their past work experiences have been unsatisfactory.

2. Employees can be motivated by higher order needs such as ego, autonomy & self actualisation.

3. Employees seek responsibility since it allows them to satisfy higher order needs.