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Chapter 17. Leadership. What Would You Do? Leadership: Dealing with Tragedy. Sandler O’Neill & Partners, L.P. is Investment banking firm located in World Trade Center on September 11 Top leaders are lost in the tragedy

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Chapter 17

Chapter 17

Leadership


What would you do leadership dealing with tragedy

What Would You Do?Leadership: Dealing with Tragedy

  • Sandler O’Neill & Partners, L.P. is Investment banking firm located in World Trade Center on September 11

  • Top leaders are lost in the tragedy

  • Can new leadership help the firm survive this catastrophic event?


Learning objectives what is leadership

Learning ObjectivesWhat Is Leadership?

  • explain whatleadership is

  • describe who leaders are and what effective leaders do

After discussing this section, you should be able to:


Leadership

Leadership

Leaders versus Managers

Substitutes for Leadership


Managers versus leaders

Managers versus Leaders

Managers

Leaders

  • Do things right

  • Status quo

  • Short-term

  • Means

  • Builders

  • Problem solving

  • Do the right thing

  • Change

  • Long-term

  • Ends

  • Architects

  • Inspiring & motivating

Adapted from Exhibit 17.1


Substitutes for leadership do leaders always matter

Substitutes for Leadership: Do Leaders Always Matter?

  • Leadership substitutes

    • subordinate, task, or organizational characteristics that make leaders redundant or unnecessary

      • professional orientation, intrinsically satisfying work, cohesive work group, etc.

  • Leadership neutralizers

    • subordinate, task, or organizational characteristics that interfere with a leader’s actions

      • subordinate skills, abilities, unambiguous and routing tasks, intrinsically satisfying work, rewards not controlled by supervisor, etc.

  • Leaders don’t always matter


Leadership substitutes neutralizers

Leadership Substitutes & Neutralizers

Adapted from Exhibit 17.2


Who leaders are and what leaders do

Leadership

Traits

Who Leaders Are and What Leaders Do

Leadership

Behavior


Leadership traits

Drive

Leadership Traits

Desire to

Lead

Self-

confidence

Honesty/

Integrity

Knowledge

of the

Business

Emotional

Stability

Cognitive

Ability


What really works

What Really Works?

Traits & Perceptions of Leadership Effectiveness

Intelligence

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success

75%

Dominance

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success

57%

Extroversion

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success

63%


What really works cont d

What Really Works? (cont’d)

Charisma & Leadership Effectiveness

Performance & Charisma

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success

72%

Charisma & Perceived Leader Effectiveness

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success

89%

Charisma & Leader Satisfaction

10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Probability of success

90%


Leadership behaviors

Leadership Behaviors

  • Initiating structure

    • clarifies follower roles and duties

    • job-centered or concern for production

  • Consideration

    • creating a supportive environment

    • employee-centered or concern for people


Blake mouton leadership grid

9

1,9

Country Club Management

Team Management

9,9

8

7

Middle of the

6

5,5

5

Road

4

3

2

Impoverished Management

Authority-Compliance

1,1

9,1

1

1

2

3

4

5

6

7

8

9

Blake/Mouton Leadership Grid

Concern for People

Concern for Production

Adapted from Exhibit 17.4


Learning objectives situational leadership

Learning ObjectivesSituational Leadership

  • explain Fiedler’s contingency theory.

  • describe how path-goal theory works.

  • explain the normative decision theory

After discussing this section, you should be able to:


Putting leaders in the right situation fiedler s contingency theory

Putting Leaders in the Right Situation: Fiedler’s Contingency Theory

Leadership Style:

Least Preferred

Co-worker

Situational

Favorableness

Matching Leadership

Styles to

Situations


Fiedler s contingency theory

Fiedler’s Contingency Theory

Group

Performance

Situational

Favorableness

=

Leadership Style

Adapted from Exhibit 17.5


Leadership style least preferred co worker

Leadership Style: Least Preferred Co-Worker

  • 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


Situational favorableness

Situational Favorableness

  • How a particular situation affects a leader’s ability to lead

  • Three factors

    • Leader-member relations

    • Task structure

    • Position power


Situational favorableness1

Situational Favorableness

Adapted From Exhibit 17.7


Matching leadership styles to situations

Matching Leadership Styles to Situations

Task-

Oriented

Leaders

Good

Relationship-

Oriented

Leaders

Poor

Adapted From Exhibit 17.8


Adapting leader behavior path goal theory

Adapting Leader Behavior: Path-Goal Theory

Four Leadership

Styles

Subordinate

and

Environmental

Contingencies


Path goal theory

  • Subordinate Contingencies

  • Perceived Ability

  • Locus of Control

  • Experience

  • Environmental Contingencies

  • Task Structure

  • Formal Authority System

  • Primary Work Group

Path-Goal Theory

  • Leadership Styles

  • Directive

  • Supportive

  • Participative

  • Achievement-Oriented

  • Outcomes

  • Subordinate Satisfaction

  • Subordinate Performance

Adapted From Figure 17.10


Leadership styles

Leadership Styles

  • Directive

    • clarifying expectations and guidelines

  • Supportive

    • being friendly and approachable

  • Participative

    • allowing input on decisions

  • Achievement-Oriented

    • setting challenging goals


Subordinate environmental contingencies

Subordinate

Perceived ability

Locus of control

Experience

Environmental

Task structure

Formal authority system

Primary work group

Subordinate & Environmental Contingencies


When to use each of the four leadership styles

When to Use Each of the Four Leadership Styles

Adapted from Exhibit 17.11


Adapting leader behavior normative decision theory

Adapting Leader Behavior: Normative Decision Theory

Decision

Styles

Decision

Quality and

Acceptance


Decision styles

Decision Styles

Style Explanation

AI - AutocraticSolve the problem yourself using the information you have.

AII - Less autocraticObtain the needed information from workers; then solve the problem yourself. Workers provide information but not alternatives.

C1- ConsultativeShare the problem with workers individually

(but not as a group), seeking suggestions &

possible alternatives. Solve the problem yourself.

CII - More consultativeShare the problem with workers as a group, seeking suggestions & possible alternatives. Solve yourself.

GII - Group decisionShare the problem with workers as a group,

seeking suggestions & possible alternatives.

Attempt to reach a consensus & be willing to

accept & implement the workers’ solution.

Adapted from Exhibit 17.12


Decision quality and acceptance

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


Decision rules to increase decision quality

Quality Rule

If the quality of the decision is important, then don't use an autocratic decision style

Leader 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 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

Decision Rules to Increase Decision Quality


Decision rules to increase decision quality cont d

Decision Rules to Increase Decision Quality (cont’d)

  • Goal 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 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


Decision rules to increase decision acceptance

Decision Rules to Increase Decision Acceptance

  • Commitment Probability Rule

    • If having subordinates accept and commit to the decision is important, then don't use an autocratic decision style

  • Subordinate 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


Decision rules to increase decision acceptance cont d

Decision Rules to Increase Decision Acceptance (cont’d)

  • Commitment 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


Learning objectives strategic leadership

Learning ObjectivesStrategic Leadership

  • explain how visionary leadership (i.e. charismatic and transformational leadership) helps leaders achieve strategic leadership.

After discussing this section, you should be able to:


Visionary leadership

Visionary Leadership

Charismatic

Leadership

Transformational

Leadership


Charismatic leadership

Charismatic Leadership

  • Creates an exceptionally strong relationship between leader and follower

  • Lead by:

    • articulating a clear vision, based on values

    • role modeling values

    • communicating high performance expectations

    • displaying confidence in followers


Been there done that

Been There, Done That

Richard Branson: Charisma without Hot Air

  • Content employees produce happy customers

  • Keeps offices at 50 people

  • Encourages and rewards risk taking and creativity


Types of charismatic leaders

Types 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

    • only want positive feedback

    • motivated by self-interest


Ethical and unethical charismatics

Charismatic Leader Behaviors

Ethical Charismatics

Power is used to serve others

Exercising Power

Followers help develop the vision

Creating the vision

Communicating with followers

Two-way communication

Accepting feedback

Open to feedback

Stimulating followers

Want followers to think and to questions the status quo

Developing followers

Focus on developing followers

Living by moral standards

Three virtues: courage, sense of fairness, integrity

Ethical and Unethical Charismatics


Ethical and unethical charismatics1

Charismatic Leader Behaviors

Unethical Charismatics

Power is used to dominate others

Exercising Power

Vision comes solely from the leader

Creating the vision

Communicating with followers

One-way communication, not open to input from others

Accepting feedback

Prefer yes-men, punish candid feedback

Stimulating followers

Don’t want followers to think, prefer uncritical acceptance of own ideas

Developing followers

Insensitive to followers’ needs

Living by moral standards

Follow standards only if they satisfy immediate self interests

Ethical and Unethical Charismatics


Transformational leadership

Transformational Leadership

  • Generates awareness and acceptance of group’s purpose and mission

  • Gets employees to see beyond their own needs and self-interest

  • Goes beyond charismatic leadership

  • Different than transactional leadership


Transformational leadership components

Transformational Leadership Components

  • Charismatic leadership/idealized influence

  • Inspirational motivation

  • Intellectual stimulation

  • Individualized consideration


What really happened leadership dealing with tragedy

What Really Happened?Leadership: Dealing with Tragedy

  • Deceased employees’ families

    • given pay check for the rest of the year

    • insurance coverage for five years

  • Jimmy Dunne became manager and provided leadership that led to strong financial recovery

    • developed new skills in negoti-ation, calmness, patience, sup-port, while maintaining strong business focus


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