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© 2008 The McGraw-Hill Companies, Inc. All rights reserved

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ChapterChapterChapterChapter

McGraw-Hill/Irwin

Leading Leading and and TrustTrust

88

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The Effect of LeadershipThe Effect of Leadership

Leadership – process of influencing employees to work toward the achievement of objectivesLeader’s style affects the leader’s behavior

Leadership and management are not the sameInfluencing employees is not the task of the

manager aloneLeadership is one of the five management

functions

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Leadership TheoriesLeadership Theories

LeadershipTrait

Theory

LeadershipTrait

Theory

BehavioralLeadership

Theories

BehavioralLeadership

Theories

ContingencyLeadership

Theories

ContingencyLeadership

Theories

Basic Leadership Styles

Two-Dimensional Leadership Styles

Leadership Grid

Transformational Leadership

Contingency Leadership Theory

Leadership Continuum

Normative Leadership Theory

Situational Leadership

Situational Supervision

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Leadership Trait TheoryLeadership Trait Theory

Assumes that there are distinctive physical and psychological characteristics accounting for leadership effectiveness

The Ghiselli Study is the most widely publicized trait theory studyIdentified six traits as being significant traits for

effective leadership

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The Ghiselli Study: Leadership TraitsThe Ghiselli Study: Leadership Traits(1 of 2)(1 of 2)

Supervisory ability.Getting the job done through others

Need for occupational achievement.Seeking responsibility

Intelligence.The ability to use good judgment, reasoning, and

thinking capacity

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The Ghiselli Study: Leadership TraitsThe Ghiselli Study: Leadership Traits(2 of 2)(2 of 2)

Decisiveness.The ability to sole problems and make decisions

competentlySelf-assurance.

Viewing oneself as capable of coping with problems

Initiative.Self-starting in getting the job done with a

minimum of supervision from one’s boss

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Behavioral Leadership TheoriesBehavioral Leadership Theories

Assume that there are distinctive styles that effective leaders use consistently,

orThat good leadership is

a rooted behavior

Principal TheoriesBasic Leadership StylesTwo-Dimensional

Leadership StylesThe Leadership GridTransformational

Leadership

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Basic Leadership StylesBasic Leadership Styles

AutocraticThe leader makes the decisions and closely

supervises employeesDemocratic

The leader allows participation in decisions and does not closely supervise employees

Laissez-FaireThe leader takes a leave-the-employees-alone

approach

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Two-Dimensional Leadership StylesTwo-Dimensional Leadership Styles

Ohio State University StudiesInitiating structure – the

extent to which the leader takes charge as the employee performs the task

Consideration – the extent to which the leader communicates to develop trust, friendship, support, and respect

University of Michigan StudiesJob centered – same as

initiating structureConcern for production

Employee centered – same as considerationConcern for people

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High Considerationand

Low Structure

High Structureand

High Consideration

Low Considerationand

Low Structure

High Structureand

Low Consideration

Two-Dimensional Leadership ModelsTwo-Dimensional Leadership Models

Low

Low

High

High

Initiating Structure

Con

side

ratio

n

3 2

14

Job-Centered Employee-CenteredUniversity of

Michigan

Ohio State University

Exhibit 8.1

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The Leadership Grid ® The Leadership Grid ® (1 of 2)(1 of 2)

Blake and Mouton’s model identifying the ideal leadership style as having a high concern for both production and people

Based on two leadership dimensions:Concern for productionConcern for people

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The Leadership Grid ® The Leadership Grid ® (2 of 2)(2 of 2)

1

1

9

9Low High

High

Concern for Production

Con

cern

for P

eopl

e

(1,1) Impoverished Manager Sweatshop Manager (9,1)

(1,9) Country Club Manager Team Manager (9,9)

(5,5) Organized-Person Manager

Exhibit 8.2

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Transformational Leadership Transformational Leadership (1 of 2)(1 of 2)

Focus is on top-level managers, primarily chief executive officers of large organizations

Transformational leadership is about:ChangeInnovationEntrepreneurship

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Transformational Leadership Transformational Leadership (2 of 2)(2 of 2)

Transformational leaders perform, or take the organization through, three acts, on an ongoing basis:

Act 1. Recognizing the need for revitalization

Act 2. Creating a new vision

Act 3. Institutionalizing change

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Charismatic Leadership

Transactional Leadership

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Contingency Leadership TheoriesContingency Leadership Theories

Assume that the appropriate leadership style varies from situation to situation

Principal TheoriesContingency

Leadership TheoryLeadership ContinuumNormative Leadership

TheorySituational Leadership

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Contingency Leadership TheoryContingency Leadership Theory(1 of 2)(1 of 2)

Developed by Fred FiedlerModel is used to determine:

if one’s leadership style is task or relationship oriented, and

if the situation matches the leader’s styleIf there is no match, Fiedler recommends

change the situation, rather than leadership style

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Contingency Leadership TheoryContingency Leadership Theory(2 of 2)(2 of 2)

Leadership StyleDetermined by completing

the Least Preferred Coworker (LPC) scales

Determines if one’s leadership style is:task oriented

orrelationship oriented

Situational FavorablenessThe degree to which a

situation enables the leader to exert influence over the followers

Key variables1. Leader-member relations2. Task structure3. Position power

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Leadership ContinuumLeadership Continuum

Model developed by Tannenbaum and Schmidt

Model identifies seven leadership styles based on one’s use of boss-centered versus employee-centered leadership

Key factors (variables) in selecting a style:The ManagerThe SubordinatesThe Situation

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Continuum of Leadership BehaviorContinuum of Leadership Behavior

Leader makes

decision and

announces it

Leader “sells”

decision

Leader presents ideas and

invites questions

Leader presents tentative decision

subject to change

Leader presents problem,

gets suggestions and makes decision

Leader defines

limits and asks

group to make

decision

Leader permits subordi-nates to function within limits

defined by leader

Autocratic Style

Participative Style

1 2 3 4 5 6 7Exhibit 8.4

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Normative Leadership TheoryNormative Leadership Theory

Model developed by Vroom and Yetton

Enables the user to select one of five leadership styles appropriate for the situation

Leadership Styles

Decide

Consult individually

Consult group

Facilitate

Delegate

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Situational LeadershipSituational Leadership(1 of 2)(1 of 2)

Emphasis is on followers and their level of maturity

Leader must properly judge or intuitively know followers’ maturity level and then use a leadership style that fits the level

Readiness – the followers’ skills and willingness to do a job

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Situational LeadershipSituational Leadership(2 of 2)(2 of 2)

Hersey and Blanchard developed four leadership styles: Telling. The leader defines the roles needed to do the job

and tells followers what, where, how, and when to do the tasks

Selling. The leader provides followers with supportive instructions, but is also supportive

Participating. The leader and followers share in decisions about how best to complete a high-quality job

Delegating. The leader provides little specific, close direction or personal support to followers

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Situational SupervisionSituational Supervision (1 of 3) (1 of 3)

Adapted from the Situational Leadership model of Hersey and Blanchard

Involves:Determining a preferred supervisory styleDefining the situationDetermining employee capability

The effective supervisor adapts his or her style to meet the capabilities of the individual or group

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Situational Supervision Situational Supervision (2 of 3)(2 of 3)

Supervisor-Employee Interactions

Directive behaviorThe supervisor focuses on

directing and controlling behavior to ensure the task gets done

Supportive behaviorThe supervisor focuses on

encouraging and motivating behavior

Employee CapabilityAbility

Do employees have the education, experience, skills, etc., to do the task without direction from the supervisor?

MotivationDo the employees want to do

the task?

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Situational Supervision Situational Supervision (3 of 3)(3 of 3)

Employee Capability Levels (C)Low (C-1)

Employees can’t do the task without detailed directions

Moderate (C-2) Employees have moderate ability

and are motivatedHigh (C-3)

Employees are high in ability but may lack self-confidence or motivation

Outstanding (C-4) Employees are very capable and

highly motivated

Supervisory Styles (S)Autocratic (S-A)

High-directive / low-supportive behavior

Consultative (S-C) High-directive / high-supportive

behaviorParticipative (S-P)

Low-directive / high-supportive behavior

Laissez-Faire (S-L) Low-directive / low-supportive

behavior

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Situational Supervision ModelSituational Supervision Model

Exhibit 8.6

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Substitutes for Leadership Substitutes for Leadership (1 of 2)(1 of 2)

I. Characteristics of Subordinates

Ability, knowledge, experience, training

Need for independenceProfessional orientationIndifference toward

organizational rewards

II. Characteristics of Task

Clarity and routineInvariant methodologyProvision of own feedback

concerning accomplishmentIntrinsic satisfaction

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Substitutes for Leadership Substitutes for Leadership (2 of 2)(2 of 2)

III. Characteristics of the OrganizationFormalization (explicit plan, goals, and areas of

responsibility)Inflexibility (rigid, unbending rules and procedures)Highly specified and active advisory and staff functionsClosely knit, cohesive work groupsOrganizational rewards not within the leader’s controlSpatial distance between superior and subordinate

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Diversity of Global Leadership Diversity of Global Leadership (1 of 3)(1 of 3)

Most leadership theories were developed in the United StatesThus, they have an American bias

Key assumptions of American-based theories:Employee responsibility, rather than employee rightsSelf-gratification, rather than employee commitment to duty

or altruistic motivationDemocratic values rather than autocratic valuesRationality, rather than spirituality, religion, or superstition

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Diversity of Global Leadership Diversity of Global Leadership (2 of 3)(2 of 3)

In the 1970s, Japan’s productivity rate was increasing faster than that of the United StatesSeven major differences between the two countries were

identified. The Japanese:have a longer length of employmentuse more collective decision makinguse more collective responsibilityevaluate and promote employees more slowlyuse more implicit mechanisms of controlhave more unspecialized career pathshave a more holistic concern for employees

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Diversity of Global Leadership Diversity of Global Leadership (3 of 3)(3 of 3)

American-based theories may not be as effective in cultures based on different assumptionsAutocratic leadership styles tend to be

appropriate in high-context culturese.g., Arab, Far Eastern, and Latin countries

Participative leadership styles tend to be appropriate in low-context culturese.g., U.S., Norway, Finland, and Sweden

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TrustTrust

Trust – is the positive expectation that another will not take advantage of you

Trust is not simply

given

Trust is earned

Levels of Trust

1. Deterrence-based trust

2. Knowledge-based trust

3. Identification-based trust

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Dimensions of Trust Dimensions of Trust (1 of 4)(1 of 4)

CompetencyCompetency

Loyalty

OpennessOpenness

ConsistencyConsistency

IntegrityIntegrity

Exhibit 8.8

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Dimensions of Trust Dimensions of Trust (2 of 4)(2 of 4)

Tips to Develop Your Integrity

Tell the truth

Keep your commitments

Be fair

Tips to Develop Your Competence

Be conscientiousKnow your strengths and

limitations

Don’t brag

Admit your mistakes

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Dimensions of Trust Dimensions of Trust (3 of 4)(3 of 4)

Tips to Develop Your Consistency

Keep your commitments

Practice what you preach

Be impartial

Tips to Develop Your Loyalty

Invest heavily in loyalty

Maintain confidences

Don’t gossip negatively about

individuals

Be viewed as a collaborator,

not a competitor

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Dimensions of Trust Dimensions of Trust (4 of 4)(4 of 4)

Tips to Develop Your Openness

Self-disclose

Accept others’ self-disclosure

Accept diversity and conflict

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The Johari WindowThe Johari Window

Known to Others

HIDDEN UNKNOWN

OPEN BLIND

Unknown to Others

Known to Self Unknown to Self

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Risk and Destroying TrustRisk and Destroying Trust

Developing trust through self-disclosure does include the risk of: being hurtdisappointedtaken advantage of

The rewards of improved human relations and personal friendship are worth the risk