Chapter 15 - Leadership
Learning Objectives: To understand the many characteristics and roles of leaders.
Leadership involves setting directions that others will be ready to follow and therefore it has a large impact on an organization's success.
Characteristics of the best leaders:
Self-confidence in success;
Innovative and encouraging of others;
Multi-talented to follow multiple topics;
Inspirational;
Honesty, integrity, ethics;
Good communicator;
Empathy and emotional intelligence.
Leaders will take on significant positions in business:
Directors:
- Elected by shareholders to be in office;
- Heads of functional departments;
- Responsible for delegating tasks;
- Assist on the recruitment of senior managers;
- Responsible for meeting department's objectives;
- Responsible for communicating objectives to the rest of the department.
Managers:
- Responsible for people, resources, and decision-making;
- Have authority over others under the hierarchy;
- Direct, motivate, praise, and discipline employees.
Supervisors:
- Appointed by the managers;
- Responsible for watching over the work of others;
- Not a decision-making position;
- Responsible for leading people to achieve pre-set goals;
- Not an inspector but someone who helps others do their work collaboratively.
Workers' Representative:
- Elected by workers;
- Have positions in trade unions or workers' councils;
- Responsible for discussing areas of concern to workers (with managers).
All of these four positions are considered to be formal leaders - they are appointed and have formal authority over others. Informal leaders raise in many social contexts: they have the ability to lead without formal power. Their leadership is based on:
Experiences;
Personality;
Knowledge or expertise.
Informal leaders might, in some cases, exercise more authority than formal ones. How should management react to them? Since they tend to have supporters amongst workers they should not be ignored: bringing them to becoming formal leaders can be a wise move (although it can have the opposite effect). There should be an attempt to incorporate informal leaders into following the business' aims.
Theories of Leadership: How and why some individuals become good leaders?
Great Man (Great Person) Theory:
- Leadership skills are inherent;
- It cannot be taught;
- Charisma, intellect, confidence, communication skills, and social skills come from birth;
- Leaders are heroic, intelligent, and are able to raise to leadership when needed.
Trait Theory:
- Also believes that leadership skills are inherent;
- Theory has been used as a predictor of good leaders: people with the characteristics (picture) are considered likely to be leaders;
- Recent developments of the theory believe some skills can be developed: decision-making, flexibility.
Behavioral Theory:
- Skills can be developed;
- Leadership skill is assessed on the behavioral response of different individuals to different situations;
- Leaders are assessed on how positively their decisions impact performance;
- Different situations require different leadership styles and the best leaders are able to adapt.
Behavioral Theory believes that the best leaders use three sets of skills to lead effectively:
Technical Skills: knowledge of processes and techniques;
Human Skills: ability to interact with people;
Conceptual Skills: ability to solve problems and creatively.
Contingency Theory:
- Successful leaders will adapt their leadership to different situations;
- It aids businesses to quickly adapt to fast-changing environments;
- There are many variables that may require leadership adaption (level of experience/skills of subordinates; the type of relationship between the leader and subordinates; amount of time needed for a task; the level of power in the leader's position.
Power and Influence Theories: theories that believe that there are different ways leaders can use power to influence subordinates:
- The leader's formal position itself;
- The expert knowledge of the leader;
- The charm of the leader (personal appeal).
Another leg to these theories is the transactional approach: employees work effectively only under a reward vs. punishment system only (pure management).
Transformational Leadership: most effective on times of significant change:
- The objective is to change the culture to achieve positive impact on performance;
- It concentrates on the needs of employees (motivation, satisfaction, productivity).
Leadership based on charisma, inspiration to achieve a vision, stimulation of the working environment (to pose challenges), understanding of individual workers' needs.
When answering a question about leadership, you could try to incorporate a reference to one or more leadership theories.
Finally, Emotional Intelligence: a trendy word we commonly hear. But what is it? How is it formed?
Emotional Intelligence is made out of several competencies, according to Goleman:
Self-Awareness of our feelings when making decisions; and of our own abilities;
Self-Management to quickly recover from stress, to be conscious, and to have self-control;
Social Awareness to understand others' feelings and views, and to be able to work wide various people;
Social Skills to handle relationships well, being understanding of different social situations, and to be able to negotiate and persuade.
There are many instances in which managers lack EI - which can bring several problems to the way they manage:
Attempting projects beyond their abilities and lacking self-confidence;
Lack trust and confidence on others making it stressful and difficult to approach;
Fail to take others' views into accounts when making decisions;
Poor performance on social situation (inability to negotiate and to build teams).
Such low levels of EI by managers would certainly decrease motivation of workers and consequentially impact performance negatively.
To-Do-List:
Activity 15.2
Chapter 15 - Leadership
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