Leadership

1. Leadership MBA 540

2. Midterm 2 Distribution

3. Learning objectives • Define leadership and contrast leadership with management • Articulate the attribution theory of leadership (specifically what traits, behaviors, and situations make others attribute leadership to a person) • Understand the trait theory of leadership and its shortcomings • Understand the behavioral theory of leadership and the managerial grid • Understand the basic argument of contingency theories of leadership, and be familiar with path-goal theory and leader-member exchange theory • Define transformational, charismatic and transactional leadership • Understand the importance of both relationship-based trust and character-based trust in leadership • Articulate how the effectiveness of some leader behaviors are culturally contingent

4. What is leadership? What makes a great leader?

5. What is leadership? • “The act of 1) establishing direction for, 2) gaining commitment of, and 3) exerting influence over other members of a group or organization to help achieve group or organizational goals.” • Leadership can be: • Formal. A recognized, appointed leader • Informal. Different members of a group exercise leadership in different situations

6. Leadership vs. Management • Leader vs. manager • Manager: helps organizational members coordinate to deal with complex tasks • Manager: keeps an organization running smoothly • Leader: creates an innovative, new vision for an organization • Leader: articulates goals and motivates others to achieve those goals

7. What makes a great leader? Who were the greatest political leaders of the 20th century? Who were the greatest American business leaders of the 20th century?

8. What makes a great leader? • Time Magazine’s most important political leaders of the 20th century • Winston Churchill • Mustafa Kemal Ataturk • Franklin Roosevelt • Fidel Castro • Vladimir Lenin • Ronald Reagan • Adolf Hitler • Billy Graham • Nelson Mandela • John Kennedy

9. What makes a great leader? • Top business leaders of the 20th century (Mayo & Nohria, 2005) • Samuel M. Walton --Wal-Mart • Walter E. Disney --Walt Disney • William H. Gates III --Microsoft • Henry Ford --Ford Motor • John P. Morgan --J.P. Morgan Chase • Alfred P. Sloan Jr. --General Motors • John F. Welch Jr. --General Electric • Raymond A. Kroc --McDonald's • William R. Hewlett --Hewlett-Packard • David Packard --Hewlett-Packard • Andrew S. Grove --Intel

10. Follower Expectations of Leaders • Attribution theory of leadership: followers attribute strong leadership to leaders that fulfill their expectations of what a leader is • Traits • Outgoing, aggressive, ambitious, competent • Behaviors • Consistency, hard-work, sacrifice, forward looking • Situations • Crisis • Success/failure

11. Follower Expectations of Leaders • Attribution theory of leadership: followers attribute strong leadership to leaders that fulfill their expectations of what a leader is • Traits • Outgoing, aggressive, ambitious, competent • Behaviors • Consistency, hard-work, sacrifice, forward looking • Situations • Crisis • Success/failure

12. Trait Theory of Leadership • Individual personal characteristics and traits that distinguish leaders from followers and effective leaders from ineffective leaders • Knowledge/skills • Personality traits • Intelligence • Energy levels • Morals • Physical characteristics • Implication: Leaders are born

13. Trait Theory of leadership • Some evidence for these traits • Intelligence • Ambition • Self-confidence • High self monitoring • Weaknesses • Very little empirical support • Predict leadership position, not performance • Ambiguous causality

14. Behavioral Theory of leadership • Leadership performance depends on what behaviors leaders exhibit • Looking for best leadership style • Outcome variables • Productivity • Satisfaction • Two styles • Production-oriented (initiating structure) • Employee oriented (consideration)

15. Leadership Grid Production Orientation People Orientation

16. Contingency Theories • Leadership traits and styles are more or less effective depending on situational factors (contingencies) • Important contingencies • Environmental characteristics • Subordinate characteristics • Leader characteristics • Leader-participation model of decision-making is an example. What are the contingencies?

17. Path-goal Theory • Related to the expectancy theory of motivation • Effective leaders choose leadership styles that align subordinates’ personal goals with organizational goals • Contingencies • Subordinate Characteristics: Experience, skills, personality • Situational Factors: task structure, stress level • Leader behaviors • Path-goal clarifying (Directive) – task oriented • Achievement-oriented (challenging goals, self-evaluation) • Work-facilitation (empowering employees to do the work) • Supportive – relationship oriented • Interaction-facilitation – facilitates teamwork • Group-oriented decision making – delegate decision-making to group • Representation and networking – managing external relationships • Value-based – creating and articulating a vision for the group

18. Contingency Theories • Leader-member exchange theory • Contingency: in vs. out group classification • Classification based on similarity to leader • In group: higher performance ratings, satisfaction, performance, and lower turnover

19. Transformational Leadership • Transactional leaders • Follow established goals • Help employees coordinate their activities • Get employees to perform using rewards and punishments • Transformational leaders • Create a new vision • Lead significant change • Motivate others to sacrifice for the greater good

20. Charismatic Leadership • People follow “great” leaders • People attribute extraordinary leadership when a leader: • Has a vision • Sets very difficult goals • Takes risks • Is sensitive to followers’ needs • Exhibits unconventional behavior • Expresses extreme confidence

21. Leadership and Trust • Relationship-based trust: trust based on social exchange. Followers trust a leader if the leader treats them well and trusts them in return. • Character-based trust: Followers trust a leader because of the leaders perceived traits: integrity, fairness, and dependability.

22. Culturally Contingent Leadership • Universally acceptable traits/behaviors: • Decisive, informed, honest, dynamic, administratively skilled, coordinator, just, team builder, effective bargainer, dependable, win-win problem solver, planner, intelligent, excellence-oriented • Universally unacceptable traits/behaviors: • Ruthless, egocentric, asocial, nonexplicit, irritable, non-cooperative, loner, dictatorial • Culturally contingent traits/behaviors: • Enthusiastic, self-sacrificial, risk-taking, sincere, ambitious, sensitive, self-effacing, compassionate, unique, willful

23. Culturally Contingent Leadership • Take aways: • Many leader behaviors are universally acceptable or unacceptable • Some behaviors are acceptable in some cultures but not in others • Employee-oriented leadership is more accepted in nurturing-oriented cultures • Production-oriented leadership is more accepted in achievement oriented cultures • Directive leadership is more accepted in high power distance cultures • Participative leadership is more accepted in low power distance cultures

24. Orit Gadiesh • What traits did Orit possess that might have led people to attribute strong leadership to her? • What situational factors may have also contributed? • Did Orit behave in a production-oriented or employee-oriented manner? • Where would you place Orit’s leadership style in the leadership grid? • Does the leadership grid suggest Orit’s leadership style will be effective?

25. Leadership Grid Production Orientation People Orientation

26. Orit Gadiesh • Do we see Orit altering her leadership style to fit with situational contingencies? • Does Orit create an in-group at Bain? • Is Orit a more of a transactional or transformational leader? • What factors may have led Bain employees to look to Orit as charismatic leader?

27. Assuming there were at least 25 consultants at Bain in 1977, Bain’s gender ratio is: • Balanced • Skewed • Tilted • Askance

28. According to the attribution theory of leadership, which of the following may have contributed to the perception that Orit was a great leader? • Her technical competence • Her willingness to sacrifice for Bain • The fact that Bain was in the middle of a crisis • All of the above

29. When Orit said, “I always have time for almost anybody who comes by…if somebody wants to talk to me, then I’m completely focused on them,” she was expressing: • Production orientation • Employee orientation • Transactional orientation • Transformational orientation

30. In her speech, Orit wanted to “reinstill a collective sense of pride” in Bain. Such a speech would be an example of: • Transactional leadership • Transformational leadership • Transnational leadership • Laissez-faire leadership

31. When Orit said, “I’ll trust you if you trust me,” she was expressing which type of trust? • Relationship-based • Character-based • Charisma-based • Transaction-based

32. A Real Leader • Isaiah 55:4, “Behold, I have given him for a witness to the people, a leader and commander to the people.” • Leader ---- leaders • Shepherd ---- shepherds • Savior ---- saviors