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Chapter 5Organizational Factors

Leadership Styles, power bases and Structure

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Role of Leadership Leadership is the ability or authority to guide and

direct others toward achievement of a goal.

Important leaders

CEOs and topmanagement

Boards of Directors

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The Role of Leadership in

Corporate Culture

Leadership is the ability orauthority to guide and directothers toward achievement ofa goal.

Leaders are key to influencingan organizations corporateculture and ethical posture.

Leadership styles influencemany aspects of organizationalbehavior, including employeesacceptance of and adherence toorganizational norms andvalues.

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Leadership Styles

Coercive leaders

Visionary leaders

Affiliative leaders

Democratic leaders

Pacesetting leaders

Coaching leaders

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Leadership styles by Daniel Goleman

Coercive Visionary Affiliative

The leader's Characteristic - Demands immediate

compliance

- threatening, tight control,

drives away talent

Mobilizes people towards a

vision

- Creates harmony and

builds emotional bonds

- Creates harmony by

connecting people to

each other

The style in a phrase: Do what I tell you come with me People come first

When the style works best: In a crisis, to kick start a

turnaround, or with

problem employeesSoothes fear by giving

direction in emergency

When changes require a

new vision or a clear

direction is needed

To heal rifts in a team or to

motivate people during

stressful circumstances

Overall impact on climate: Negative Most strongly positive positive

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Democratic Pacesetting Coaching

The leader's modus

operandi:-Forges consensus through

participation-Superb listener, team

leader-Values input and gets

commitment through

participation

-Sets high standard of

performance

-builds challenge and exciting

goals for people-low on guidance, expecting

people to know what to

do.

Develops people for the

future

-helping people find

strengths and

weaknesses

-good at delegating

challenging

assignments,

The style in a phrase: What do you think? Do as I do, now Try this

When the style works best: To build buy-in or

consensus, or to get

input from valuable

employees

To get quick results from a

highly motivated and

competent team

To help employee improve

performance or develop

long-term strengths

Overall impact on climate: Positive Negative Positive

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Leadership

The most successful leaders do not rely on onestyle of leadership but alternate their techniquebased on the characteristics of the situation.

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Power bases

Power-ability to influence the behavior/attitudeof another

Exerting power is one way to influence ethicaldecision making framework

Power in itself is neither ethical or unethical, its

use can raise ethical issues

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Coercive Use of threats/actual punishment to influence

others Penalize actions Beneficial in changing behavior in short run Overuse may result in de-motivation,

breakdown of relationships, resistance

Reward Influence behavior by offering something

desirable

E.g. money, promotion, non monetary rewards Rigid reliance on rewards may force employees

to indulge in unethical practices

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Legitimate Right to exercise authority

Position related Strong affiliation to legitimate power may lead to

employees unethical behavior

Expert Derived from having high level of knowledge,specialized skill

Power may be accorded on basis of greaterknowledge, years of experience, education, honours

received Creates ethical problems when knowledge is used

to manipulate others

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Referent

Function of respect and esteem accorded to anindividual by virtue of personal attributes withwhich others identify

Can be used to create an atmosphere whichmotivates workers and improves productivity

effective: when empathy and trust exist betweenboss and employee

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Centralized Structure

- If organization is very bureaucratic, employeesbehave according to letter of law rather than spirit

- Ethical concerns arise due to little upwardcommunication. Top managers are seldom aware ofproblems and unethical activity. E.g. sweatshops

- Blame shifting or scapegoating because due to high

specialization there is a lack of connectedness due towhich employees fail to understand affect of actionson the overall organization

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Due to strict formalization and adherence torules they tend to be more ethical in their

practices

Can exert more influence on employees due topolicies and codes of ethical conduct

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Decentralized

-Different value systems may evolve in differentsub units

-Difficulty in responding quickly to changes inpolicy and procedure made by top management

+Can avoid ethical dilemma by tailoring their

decisions to specific situations, laws and valuesof a particular community

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