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Chapter One

The Nature and Importance

of Leadership

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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Learning Objectives

Explain the meaning of leadership and how it differs from management.

Describe how leadership influences organizational performance.

Pinpoint several important leadership roles.

Identify the major satisfactions and frustrations associated with the leadership role.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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Learning Objectives (cont’d)

Describe a framework for understanding leadership.

Recognize how leadership skills are developed.

Pinpoint several traits, behaviors, and attitudes of a successful follower.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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The ability to inspire confidence and support among the people who are needed to achieve organizational goals

Leadership

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Leadership as Partnership

Leadership is a long-term relationship, or partnership, between leaders and group members.

The power between leader and group members is approximately balanced.

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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Leadership as Partnership (cont’d)

Factors necessary for a valid partnership to exist are: Exchange of purpose A right way to say no Joint accountability Absolute honesty

Table 1-1 Leaders versus Managers

[INSERT TABLE 1-1]

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Leadership Matters

The research shows that leadership is responsible for between 15-45% of a company’s performance; however, transactional leadership was not significantly

related to performance charismatic leadership was slightly, positively

related to performance in an uncertain environment, charismatic

leadership was more strongly related to performance

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Attribution Theory

Based on research, changes in leadership are followed by changes in company performance.

When change occurs, the perception is widely held that the cause is attributed to leadership

Most organizational successes are attributed to heroic leaders

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Leadership Does Not Matter Three major arguments against the

importance of leadership include:

1. Substitutes exist for leadership2. Leaders can be irrelevant; people lead

themselves and outside influences can overwhelm

3. Organizational systems are far too complex to attribute success to leadership

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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Figure 1-1 Substitutes for Leadership

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Leader Irrelevance

Situational factors, outside the leader’s control, have the largest impact on outcomes

High-level leaders have unilateral control over only a few resources, and the control over these resources is limited by obligations to stakeholders

Firms choose new leaders whose values and behaviors are similar to previous leaders

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Complexity Theory

Organizations are complex systems that cannot be explained by the usual rules of nature

Leaders and managers can do little to alter the course of the complex organizational system

A company’s fate is determined by factors outside the leader/manager’s control

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Leadership RolesAn expected set of activities or behaviors stemming from one’s job

Figurehead Spokesperson Negotiator Coach and

motivator Team builder

Team player Technical problem

solver Entrepreneur Strategic planner

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Sources of Leader Satisfaction

A feeling of power and prestige A chance to help others grow and develop High income Respect and status Good opportunities for advancement A feeling of “being in on” things An opportunity to control resources

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Leader Frustrations Too much uncompensated overtime Too many “headaches” Facing a perform-or-perish mentality Not enough authority to carry out plans Loneliness Too many problems involving people Too much organizational politics The pursuit of conflicting goals Being perceived as unethical, especially if

you are a corporate executive

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Figure 1-2 A Framework for Understanding Leadership

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Qualities of Effective Followers

Strong ability to self-manage Commitment to something beyond

themselves Will take initiative to strengthen

competencies and focus attention Courageous and independent nature

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Summary

Leadership is a long-term relationship between leaders and group members. When effective, it inspires confidence and support among people who are needed to achieve organizational goals

Although some research supports the theory leaders do affect organizational performance, the concepts of substitutes, leader irrelevance, and complexity theory suggest otherwise

© 2010 Cengage Learning. All Rights Reserved. May not be scanned, copied or duplicated, or posted to a publicly accessible website, in whole or in part.

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Summary (cont’d)

Leadership involves carrying out at least nine different roles

There are many sources of both satisfaction and frustration to leaders

Leadership is a function of leader characteristics and traits, leader behavior and style, group member characteristics, and the internal and external environments

To be an effective leader, one needs good followers