CHAPTER .I / THE NATURE AND IMPORTANCE OF LEADERSHIP

As a former ROTC scholar and six_year naly officer,the CEO and president ofBcc Softrvare, Inc. mightbe expected to be somewhat of a drill sergeant at

Ij5: ]1r,."d. employees at fon Runsrrom,s mailing

sottware design firm describe the SZ_year_old as akind and understanding manager, read.y to pitch inat any level-even helping his staff stu#.rrrrilop.r.

, . "I rhink we had iust moved in and we didn,t have

ttrngs ser up. We didn't have tables. I remember sit_ting on the floor. There were about ten ofus just stufGing. He

-carne over) sat down, and worked Cght Aorrgyd 1rs," says James Mann, Bcc Software lric. p..ri_

9.^?:a: customer sy.pporr. "l can rememu"., ,"ipo.,

tecnmclan sayng, ,That,s a great thing to see., It wasa great opportunity. We were able to sit down with Jonand talk with him and have fim and loke around.,,

Runstrom's down-to.-earth ma.rag.ment rtyle,which has helped maintain a 2 p.r.errt"turnov.r rate

:I-.r, m. t":, O5.U"rtt at Bcc Sodwar., i, p"rJy due ronts degree in industrial psychology. It also stems fromhis.humbling experience in turrrrlt irrg * irrfur_"tio.,

technology srartup some twenty_rii,y.*, ago that

eventually became Bcc. The companyhas grown froma two-person srarrup to a staff of fiftpeight withthousands of. software customers in all fifty states,Puerto Rico, and Canada.

. Runstrom says, ,,For any business, f don,t care

what you're doing, you,ve got to treat employees asif they're your own customers." Bcc,s Software,sfacilities. were designed to give employees muri_rrmpersonal space. Runstrom also advocates flexibler,vorking schedules and organizes golf tournamentsfot

Pnl"n:es and trips to amusemenr parks.

"The culture here at Bcc is a rr.ry op"r, environ_ment, very flexible environment. people here appearto be happy. Customer support, foi example, youcan have a turnover rate ofsay 50 to 60 p.r.irrt, andat this point we,re at zero percent. No one has leftthis department in a year," says Mann.

^ 1""*19- says he's ,,r.rr". t..r, a top_down kindof boss. "Those things in my mind ,r.r,., Jid *o.L,never do work, never will work., He ad.ds that flex-ibility is fundamental to good management, and thatyou have to trust people.l

TT -:n11a5te1ization of Jon Runstrom rouches on many leadership topics to beI covered in this book, including the ideas that caring r""a"rrr,rrp can make a dif_l ference in an organization's J,r...rr, ,n", a successful leader works well withhis or her team, and that many

"r..ar.-ii"aers are "iribl;;;;proachable . ourintroductory chapter begins with. an .*ptu.r"tio, of what leadersirrp is and is not.we then examine how leaders make a aiil..n.., the various roles they play, and themajor satisfactions and frusrrations they experience. The .h;;;r- arso includes anexplanation of how reading this book ani doi'ng the various qtizzesand exercises willenhance your own leadeiship skills. It .o".roa", with a air*Jo' of ,,follower_

ship"-giving leaders go'od material to work wrth.

The Meaning of Leadership

You will read about ma11 effegtive organizationar leaders throughout this text. Thecommon characteristic of t-hese leaders ir their ability to inspire *?r-rl-,rru," others toi:T:*

worthwhile goars. Thus we can a.n r. t."o."rhip *'trr. uuitity to inspire confi-dence and support among the people who are needed tJ achieve organizationar goals.2A Google search of articles and books "b";;;;..rhtp";f;*, 533 m'rionentries. In all those entries, leade.rship has probably b..r, a.fio.d i., -"ry ways. Frereare several other representative definitions'of leadership:

-- --^ l

THE MEANING OF LEADERSHIP 3

t r-(:)\\ n tromh--eieht si&I rrin- states-

I don't careemrlor-ees as's Sols-are'srs nar-imum;ates fleribletLr'arnamen6p;:rs.per enr-iron-e here appearx.i:-irple, t'oupeicentr'and| r:'1e has left

p-.iori'n kindrer .iid l-ork,ild-. lhat flex-rn:. and that

r topics to ben make a dif-d-. -.r ell withrchrble. Ourr ind is not.pl:,,. andther Lncludes anere rcises willrf -tbllower-

hr. ::rt. Thehr; others toin : ,'e confi-1i"--:lal goals.2t - . r . t r .

n..-l mluon| - -F

-. l\'s. flere

€ Interpersonal influence. d.irected through communication toward goal attainment

m Theinfluential increment over and above mechanical compliance with directions

and orders

tr An act that causes others to act or respond in a shared direction

m T h e a r t o f i n f l u e n c i n g p e o p l e b y p e r s u a s i o n o r e x a m p l e t o f o l l o w a l i n e o faction

{a Theprincipal dynamic force that motivates and coordinates the organization in

th. u..o-plishment of its objectives3

w A willingness to take the blame (as defined by legendary football quarterback

loe Montana)a

Amajorpointabout leadership is that i t isnot foundonlyamongpeople inhigh-t.u.t poritions. Leadership is neeied at all levels in an organization and can be prac-

ticed to some extent .u.n by a person not assigned to a formal leadership position'

For example, working a, a i.r.tio' accountant) a person might take the initiative to

suggest ro management thai they need to be more careful about what they classifi, as

a true sale. An extreme example of the importance of workers exercising leadership is

Roadway Express, Inc' Aftei implementing a program 9f gllloVee involvement in

productivity improvement, RoaJway management concluded that if Roadway is to

io-p.a. in an industry in which n"i profit margins are less than 5 percent in a good

y.ur, .rr".y one of its jg,OOO employees must be a leader's'

ifr. aUitity to lead others effectively is a rare quality. It becomes even more rare at

the highest livels in an organization because the complexity of such positions requires

" unr,".*g. of leadership"sldlls. This is one reason that firms in search of new leader-

ship seek 6ut a select group of brand-name executives.6 It is also why companies n-ow

.-phn, i , . leadership, t ra in inganddevelopment tocreateanewsupplyof leadersthrouehout the fi.rm.

'#6H8W.The current understanding of leadership is that it is a long-term relationship, or

partnership, between leadJrs and group members' ^tt"t9t1q,t:l:::ilt::l:;:l"i

;;;;;hf; in. t.rd., and the sioup m.e'nbers are t:,"t:':'9 in such a wav that, , - , - , -^- , :^^+^r- . 1-^ l^-- - , { I l l^r l r e iso descr ' ihes Dartnef-

ih. po*.. L.*..n them is approximately balanced' Block aiso O:tti!,:: n-T:1ti

ship as the opposite of p"r.ntittg (in which.one person-the parent-takes respon-

slUitity fo, ttr" welfare tf .n. oihe.-th. child). Partnership occurs when control

shifts from the leader to the group member, in a move away from authoritarianism

and toward shared decision iaking 'Z Four things are necessary for a valid partner-

ship to exist:

l. Exchange oJ'pw"pose.In a partnership, every worker at every.level is responsible for

defining vision and ,rulo.,. Through diaiogue with people at many levels' the

leader helps articulate a widely accepted vision'

2. A ri.ght ti say ru0. The belief inut peopl. who express a contrary opinion will be

porrirh.d runs contrary to a partnership' Rather, a person can lose an argument

but never a voice.

4 CHAPTER 1 /THE NATURE AND IMPORTANCE OF LEADERSHIP

t?t: : l!t;: !.; ::: ;. i? :,i:j, f..ii i;i: ;:.ij:ti ;. :!i ; ;

ftni::: ":jr.:lt::**,*:-o,nasizes that teadership is a relationship between

-.. " :. n : I t.. ": ;t:, ; ?. tt ! e;t t ?,t it:!+ iat aa t : t ar:i

ffX*'",:* j: "*:'3f : t:,1

: ̂ tTry:11. :o s:u,q the differenc e b e twe en re adershipl?*:lf-"::ll *, : t:l a clue from, tr'" """'J"'i ;;;"#; ffi:'ffi [H:r ul ule runcnon

;:"ilfffl.ffiil,r:Tl:,r: jl?T'1lli, ai,..ti,,g 1o,'r."ai,,g), and controling*i::.::l

major part ofn -nir"g.r's1:ob, y., u -u,ruger musr "r* nr"ri,'ji*1'r?3,

3 ' Joint accountab'ility. rn lpartnership, each person is responsible fbr outcomes andthe current situation. In practice, this means that each person takes personal

. accountability for rhe success and failure of the organir"tioiJ.rrrit.

4' Absolwte honesty. In a partnership, not telling the tiuth to one *oth.. is an act ofbetrayal. ,lvhen power is distri-buted, people are more likely to ten the truthbecause they feel less mlnerable.8

- Block's conception of leadership as a partnership is an ideal to strive toward.Empowerment and team buildingjt*o -ujo, topr.. in this book-support the ideaof a partnership.Looking at leadership as a partnership is also important because it is linked to anoptimistic view of group members, refeired to as siewardship theory. This theorydepicts group members (or.followers) as being collectivists, pro-organizational, andtrustworthy.e A collectivist is a person who is more concerned about t_he welfare ofthe group than about his or her personal welfare. FIave you met many colrectivists inthe workplacel

the leader and the peopre being led. Research indicates ,n* n"rlt"*?":TTnltionships with group members _is.-a major success factor for the three top positionsin large organizations. James Kouzes ura nur.y posner conducted an online sur_vey asking respondents to indicate, among other questions, which would be moreessential to business success in fiu. y.urrlrociar siills or Internet sk1ls. seventy_two percent indicated so_cial skills, and 2g percent Internet skills. The authorsconcluded that the web of peopre matrers more than the web of technology.l0 (yeta person who lacks Interner skills may not have ,rr.

"fp"r*;;; r" be in a posi-

1^": t: manage relationships-) Building relationshipst *itr, plopre is such an

#ffitg,:art of leadership that the theme will be introducei at various points

and control.Broadly speaking, leadership deals with the interpersonal aspects of a manager,sjob, whereas planning, orguiiting, and controlling deal with the administrativeaspects' Leadership dears w^ith .lTg", inspiration, morivation, and influence. Table

,t^ l-ft::r"".a srereot)?e of the didr.n.., b.*..n leadership and managemenr. Asrs the case with most stereotypes, the differences tencl to be eiaggerated.

According to rohn p I(oiter, a prominent leadership theorist, managers mustknow how to lead as well "r

,,'"n"g.. witho.rt being t.a u, -.ti u, -urrug.d, organi-zations face the threat of extinctio"n. Following are several key distinctions betweenmanagement and leadershio:

THE MEANING OF LEADERSHIP 5

" Leaders Versus Manq-gers:l-**--*e**tr'*w*w-*nw'n'v@wlw*tflM-tryfK::;

Passionate

Creative Persistent

rtcomes and

kes personal

f .. ;rn aCt Of11 the truth

ri" e tos'ard.x,:: rhe idea

li:ied to anT:is theory

Za::tlnal, and

rc u eltare of

ol,ecrir-ists in

lnnovative Analytical

Couraqeous Structured

lmaqinative Deliberative

FYnorimant2l AuthoritativeL / \ P v ' " t ' v ' r l q i

Trusting Guarded

Cool and reservedWarm and radiant

lnitiator

Acts as coach, consultant, teacner Acts as a boss

I : "Ih-: eets'een

i grrod rela-n: rositionsr c,rl ine sur-u-i be morerll.. Seventy-T::e authorsoi,r*r'.10 (Yet

be :n a posi-r -s such anY:*]'.lS pOintS

I " . .Ibn -eadershipth.;:unctions

- , . . r r n l l i n s! 1 : u v 4 r r b .

[:-. -',rganize,

F: :r,rnager'sr!:::ristrativeh,re:ce . Table

tsge ment. Asii.lnf,gers mustrse"l. organi-[c':is betq/een

Does the right things Does things right

source: Genevieve capowski, 'Anatomy of a Leader: where Are the Leaders of Tomorrow.?" Management Review'

vli"tl I sga, p. 1 2; David rugiuno,-;Munugers Versus Leaders:,A corporate ^r^?b)/: ̂M:::"9,"ment Review'

iiffi;6; i'r6;, -p'

s; x"r.iill Eiorc, The"LJhinate Six Sisma (New York: AMACOM' 20,02)'re@v*A%@ee*et4*4@@R@Me@'ffi

e@w*@'sw@

w Management prod,uces order, consistency, and predictability'

m Leadership produces change and adaptability to new products) new markets,

,ta* ao-patitors, new customers) and new work processes'

* Leadership, in contrast to management, involves having a vision of what the

organizati-on can become and mobilizing people to accomplish it'

* Leadership requires eliciting cooperation and teamwork from a large network of

people ani L.eping the key people in that network motivated by using every

manner of Persuasion.m Leadership produces change, often to a dramatic degree, such as by spearhead-

ing the launch of a new piodu.t or opening a new market for an old product.

M.-"rr"g"1n..,.t is more likely to produce a degree of predictability and order'

ru Top-level leaders are likely to transform their organizations) whereas top-level

managers just manage (or maintain) organizations'

m A leader creates a vision (lofty goal) to direct the organization. In contrast, the

key function of the manag.r ir io implement the vision. The manager and his o,r

her team thus choose the means to achieve the end that the leader formulates.[

If these views are taken to their extreme, the leader is an inspirational figure and

the manager is a stodgy bureaucrat mired in the status quo. But we must be carefirl

not to do"wnplay the importance of management. Effective leaders have to be good

6 CHAPTER 1 /THE NATUREAND IMPoRTANCE oF LEADERSHIP

managers themselves, or be supported by effective managers. A germane example isthe inspirational entrepreneur who is so preoccupied witlimotirr"?ng

"-plor;;;;captivating customers that he or she neglects internal administrati"on. As a result,costs skyrocket beyond income, and such matters as funding the employee pensionplan and paylng bills and taxes on time are overlooked. in short,'the differencebetween leadership and management is one of emphasis. Effective lead.ers also man-age, and effective managers also lead.

The lmpact of Leadership on organizational performance

An assumption underlying the study of leadership is that leaders affect organiza-tional performance. Boards of directors;the highest-level executives of an Jrgani-zation-make the same. assumption. A frequent antidote to major organizationalproblems is to replace the leader in the hope that the newly appointed leader willreverse performance problems. Here we will review so-e of the evidence and opin_ion, pro and con, about the ability of leaders to affect organizational performairce.The r eader_in Action profile provides a positive example Jf th. i-portance of erTec-tive leadership.

hen Rose Marie Bravo took over aschief executive of Burberry Group plcin 1997, the company was a staid

British raincoat maker, far off the radar screens ofthe fashion world. Today, Burberry,s turnaroundis legendary, and its tartan bedecks everwhinsfrom hats to luggage to bikinis, in a riot of colorifrom pink to blue to purple.

Most notably, Burberry has been able to sustainits new momentum, consistently posting gains inan industry nororious for passing trends and fickleconsumers. The company has had five straiehtyears of annual sales increases, with annual iiol-umes of about $1.2 billion (626 pounds sterling).

The Bronx-born Ms. Bravo, 53, began as a cos_metics and fragrance buyer at Macy,s before jump_ing to the now defunct upscale retailer, I. Masnin.where she rose ro chairman and CEO. In 1952,she was named president of Saks Fifth Avenue-

which she ran for five years until leaving to joinLondon-based Burberry. She sat down with TlteWall Sn"eet Jow.nal to talk about how she plans tokeep Burberry flourishing without dilutlns thebrand's exclusive image. Excerpts showing Biavo,sleadership practice and attitudes follow:

WS|: How do you keep the brand hot and freshseason after season when fashion alwayschangesf

Bravo: This is the biggest quesrion facing anybrand, whether it is Coca-Cola or MercedesBenz. Constant creativity and innovation arerequired. You just can never stop. Our newmotto at Burberry is we never stop designing.And creativity doesn,t just come from thedesigners.

For example, we did an ad campaign .they did flashes of color, literally thrown onto

THE IMPACT OF LEADERSHIP ON ORGANIZATIONAL PERFORMANCE

The idea that leaders actually influence organizational performance and morale is soplausible that there is not an abundance ol research ani opinion that deals with thisissue' (Nor do we have loads of studies dernonstrating thaisleeping reduces fatigue.)F{ere we look at a sample of the existing research anJ opinion.^

and white picture. It almost looked likehnt had spilled color onto the photograph.b looked ar it and said, this should be scarves.

m-E ,lid a q'hole series of scarves that becameheqsellers. This idea came from our fadvertis-nmng. aeencv.

ndeas can come from the sales floor, the mar_kdng departmtnt, even from accountants,trclie\ e ir or not. So keeping that open attituderhrr r-ou can get an idea that can be a businessnlra from just about an),rvhere is important.It is not just the ownership of one p.rron o.rrro people.

FSf: \\hat do you do specifically to motivate andinspire peoplef

Gravo: We like management to visit the stores,ralk to the salespeople. pe ople at whatever levelrhev are working have a point of view and havesomething to say that is worth listening to. Wem- to set an agenda throughout the companyn-here everyone's opinion counts, and it's niceto be asked.

WS|: Star designers have become more commontoday. But it sounds like you believe in a teamapproach.

Bravo: Some people like a lot of confrontation. Idon't. I like people to get along. I like to haveeverybody contribute. But I don't necessarilybelieve in consensus, because then you can endup with mediocrity.

WSJ: For examplelBravo: The plaid shopping bag. Everybody

wanted to go neutral-solid beige or black. Ifelt instinctively, it was too subtle. In fact, wecould have the only shopping bag that didn,t

have a logo on it, and we didn't have to writeour name across ir. I called Geraldine Stutz,the retired head of Henri Bendel (the NewYork specialty retailer famous for its brownstriped bags). I said, ..We need to do a shop_ping bag, what do you thinkf" She said,"Come on, it has to be plaid.',

Bravo offers five lessons for rebuilding and sus_taining a hot brand:

I Lesson I: Don't rest on your laurels-reinventyourself every day and never stop thinking ofnew ways to wow the customer.

r Lesson 2: Maintain riour core customer whilepursuing a new one.

I Lesson 3: Don't worry about where a new ideacomes from. Execution is the key.

I Lesson 4: Don't rely on a formula. lust becausesomething works for one company doesn,tmean it will work for another.

I Lesson 5: Surround yourself with great people.It's all about teamwork.

q ,F I I | 9 I Il. In what way does Bravo bring technical exper-

tise to her leadership positionl2. In what way does Bravo emphasize listening to

workers in her leadership approachf

SOURCE: Excerpted from Sally Beatty; ,.plotting plaid,s Future:Burberry's Rose Marie Bravo Designs Ways io Keep Brand

9r9yi"g and Still Exclusive,,' Tl.te Wall Street Jowrnal, Siptember9,20.04, pp. Bl, 88. Copyright 20O4 by Dow Jones & Co., Inc.Reprinted with permission of Dow lones & Co. Inc. in the formatTextbook via Copy.ight Clearance Center.

8 CHAPTER 1 /THE NATUREAND IMPORTANCE OF LEADERSHIP

]1,:llTlt: :" rhe previous argument, the antileadership argument holds that leader-

*n^ 3t^ I :n*-:r. imp act on organiz atiorrnt o o,.o-., A; ?;;;" *lil" J;.To personalize this perspective, i

1-ugil: yourself appointed as the manager of a group

:lltltt skilled investmenr bankerJ How well y-r. groop p.rfir;;;:";fu;;:;tt_

If *?::".1"::.:1.::",1r:l:"qtoeconomil;""dt;;;;J;;;;;;;il.*".ff.thr;3 lajor argumenrs againsr the importance of readership are *uror*.I"ili r#

A team of researchers investigated the impact of transactional (routine) and charis-matic (inspirational) leadership on financial performance.r2 The i.s.ar.he^ analyzed.2r0 surveys completed .by.senior managers from I3r Fortane 500 firms. Trans_actional and charismatic leadership styles i.r"r. *."rrrred with a leadership question_naire. Each participant was asked io thirrL about the cEo of his or her company andrate that individual on the leadership scale . Because an uncertain environment oftenmakes having a strong leader -or. i-po.tant, participants arso completed a ques_tionnaire that measured perceived. environmental uncertainty. organizational per_formance was meas rred as net profit margin (NpM), .o-put.d as net incomedivided by net sales. The performiance data were gathered frorn public informationabout the companies.

The results of the study disclosed that (1) transactional leadership was not signifi-cantly related to performan ce, (2) charismatic leadership showed a slight positive rela-tionship with performance, and (3) when the environm.rrt i, orr..rtain, charismaticleadership is more strongly related to performance.In another study, a group of res"*.h"r, anaryzed.2O0 management techniques asemployed by 150 companies over ten years. The aspect of thJstudy evaluating theeffects of leadership found that cEos influence l5 p....nt of the total variance (influ-encing factors) in a company's profitability or totaf return to shareholders. The samestudy also found that the industry in which a company operates also accounts for 15percent of the variance in profitability. So the choice of a cEo leader is as importantas the choice of whether to remain in the same ind.ustry or enter a different one.r3In addition to tangible evidence that leadership makes a difference, the perceptionof these differences is arso meaningful. An understanding

"f ;.:.;.rceptions derivesfrom attribution theory, the thJory of how we explain the cauJes of events. GaryYuld explains that organizations are iomplex social systems of patterned interactionsamong people. In their efforts to understand (and simplifr) irgu.rirutiorral events,people interpret these events in simple human_terms. one especially strong andprevalent approach is to attribut. .",rolity to leaders. They are

"i*.a as heroes andheroines who determtT ,h: fates of their organizations.la The extraordinary successof southwest Airlines co. during the 1990s is thus attributed to Herb I(elleher, itsflamboyant chief executive. IGlleher initiated no-frills, low-cost air service and builtsouthwest into a highry profitable airrine. (ultimately, .r.*

-lo-p.orors

modeledafter Southwest, such as JitBlue Airrines, took away some of soutri-.rt,, profitabil_ity.) Most organizational successes are attributed to heroic leaders-according roattribution theory.

ership, leadership irrelevance, and complexity theorv.

I

F

t-lic

:tshetr-DE

t5nt

)nE5

qnsts.ndndis5

itsiltedil-to

;r-rn.trPb -hed

THE IMPACT OF LEADERSHIP ON ORGANIZATIONAL PERFORMANCE 9

FIGURE 1-1 Substitutes for Leadership

twtuF*@ tu@*Mlwtu

Substitute s for Leadership At times competent leadership is not necessary) and

incompetent leadership can be counterbalanced by certain factors in the work situa-

tion. Under these circumstances) leadership itself is of little consequence to the per-

formanceandsat is fact ionof teammembers.Accordingtoth isv iewpoint ,manyorg*irutlons have substitutes for leadership. such substitutes are factors in the work

environment that provide guidance and incentives to perform,-making the leader's

role almost sop.rflrrour.tt Figo.. I-1 shows four leadership substitutes: closely knit

teams, intrinsii satisfaction, computer technology, and professional norms'

clowly lenit tenrws of highty traiyted. i.nd.ipid.wnls. w4ren members of a cohesive, higily

truini group are foculedott a goal, they may require almost no leadership to accom-

plish thJir task. Serreral resea.chLrs have studied air traffic controllers who direct traf-

fic into San Francisco and pilots who land jet fighters on a nuclear aircraft carrier'

With such groups, directive (decisive and task-oriented) leadership is seemingly

unimportani When danger is tire highest, these groups rely more on each other than

on a leader.

Inn insi,c sntisfa.cti,0n.Employees who are engaged in work they find strongly self-moti-

vating, or intrinsically ,"drfylng, require a minimum of leadership. Part of the reason is

thut t. task itself grabs the workeris attention and energy. The worker may require lit-

tle leadership as long as the task is proceeding smoottrly. Many information technology

fums provide a minimum of leadership and management to computer professionals,

*ho m"y be totally absorbed in such tasks as combating the latest computer virus'

Cvrllputei' te chnology. some companies today use computer-aided monitoring and com-

puter netlvorking to take over many of the supervisor's leadership functions' The

.o-p.ra., provides productivity and quality data, and directions for certain tasks are

entered into the inlbrmation system. E r.r-t "rtot

detection and goal lettinq

are incorpo-

rated into some interaction systems. Instead of asking a supervisor tor asslstance) some

employees use the computer network to ask for assistance from other workers' (we could

*grr. L.r. that the .o-poa.. is being used to control radrer than to lead workers')

professi.onnl n4rl,tcs.workers who incorporate strong professional norms often require

u -irri-o- of supervision and leadership. A group of certified professional a:coY:l-

tanrs may not neeld visionary leadership to inspire them to do an honest job of audit-

ine the books of a client or advising against tax fraud'

10 CHAPTER .I / THE NATURE AND IMPORTANCE OF LEADERSHIP

Although the leadership substitute concept has some merit, it reflects naivet6about the role of organizational leadership. Bass notes that self-management bygroups and individuals requires delegation by a higher authority. In addition, higher-ranking managers provide guidance, encouragem.r.t, urrd support.r6

More recent research study suggests that the theory of substitutes for leadershipmay be flawed and that_leadership does indeed have an impact on group effective-_ness. A team of researchers conducted a study of forty-nine organizations with atleast 50 employees and two levels of management. The sa-p[ consisted of 940employees and 156 leaders. Measures of substitutes for leadeiship were similar tothe information presente d above, such as ,,I am a member of a professional groupwhose standards and values guide me in my work." In short, th. stody ,ogf.rt.ithat "leadership matters." The likeability of the leader anj whether the leaderprovides rewards for good performance were found to be the major correlates ofperformance.lT

Leader lrrelevance According to the theorizing of Jeffrey pfeffer, leadership isirrelevant to most organizational outcomes. Rather, it is the ,itoutron that must becarefully analyzed. Pfeffer argues that factors outside the leader's control have a largerimpact on business outcomes than do leadership actions.r8 During the late 1990s andearly 2000s cell phone^ ownership surged throughout the world,-with g0 percent ofadults in the United States owning cell phones. The sales boom in this electronicequipment could be better attributed to an outside force than to inspirational lead-ership within telecommunications companies.

Another aspect of the leader irrelevance argument is that high-level leaders haveunilateral control over only a few resources. Furthermore, thJ leader,s control ofthese resources is limited by obligations to stakeholders like consumers and stock-holders' Finally' firms tend to choose new organizational leaders whose values arecompatible with those of the firm. The leaders therefore act in ways similar toprevious leaders.

Jim Collins, who has extensively researchecl how companies endure and how theyshift from average to superior performance, also doubts the relevarice of leadership.According to his earlier research, corporate leaders are slaves of much lurg., orgri_zational forces. Collins makes the analogy of children holding a pair of ribbons insidea coach and imagining they are driving the horse . It is not the leader's personality thatmakes a difference; more important is the organization's personality. For exampre,Collins notes that /ack Welch was the product rather than tie producer of GE,s suc-cess during his long reign.le

The leader irrelevance argument would have greater practical value if it were recastas a lead'er constraint theory, which would hold that leaders are constrained in whatthey can do but still have plenty of room to influence others.

C.omplexity Theory Similar to the pessimistic outlook of leader irrelevance isthe perspective of cowplexity theo't'y, which holds that organizations are complexsystems that cannot be explained by the usual rules of nature. Leaders and man_agers can do little to alteithe.orrrr. of the complex organizational system. Thesame view holds that forces outside the leader oi -urug.r's control determine acompany's fate. Managers cannot predict which business strategies or product

i nair-ete

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n hisher-

rciershipft-e crive-r s-ith att ot 940milar totl uroupgSestedr leaderrlates of

ership isEust bea larger90s andrcent ofcctronicni lead-

m haventrol ofI stock-lues arenilar to

'$-they[e rship.oreari-s inside[n rirat

[ 's suc-

B recastn s'hat

rnce isrmplexI man-n. Thehrne ahc,dr,rct

12 CHAPTER 1 /THE NATURE AND IMPORTANCE OF LEADERSHIP

2

:h:rulilif:-:,9.

lwould ":'"t

.""1 ng other members of the team.

4

13. The problems of my teammares are my problems too.

14. Resolving conflict is an acdviry I enjoy.

3

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14 CHAPTER 1 /THE NATUREAND IMPORTANCE OF LEADERSHIP

3' Negotiator. part of almost any manager's job description is trying to make dearswith others for needed resources. Researchers have identifi.dthr.. specific nego-tiating activities:

a. bargaininc\"iq superiors for funds, facilities, equipment, or ofrrer forms of supponb' bargaining with other units in the organiration for the use of staff, facilities,equipment, or other forms of supportc. bargaining with suppriers and v.njo., for services, schedules, and delivery times

4. conch and' rwotivator. An efrective read.er takes the time to coach and modvateteam members. This role includes four specific behaviors:a. informally recognizing team members, achievementsb' providing team members with feedback concerning inefrective performance.

ffXH:.rhat team members are informed of ,t.pJthat.u., i_pror," their per_

t il*r"T.rJting

rewards and punishments to encoLrrage and sustain good per-

5 ' Teana buitd'er' A key aspect of a leader's role is to build an effective team. Activitiescontributing to this role include:a. ensuring that team members are recognized for their accomplishments, such as. through letters ofappreciationb' initiating activities that contribute to group morale, such as giving parties andsponsoring sports teamsc. holding periodic staffmeetings to encourage team members to talk about theiraccomplishments, problems, and concerns

6' Teatn Ttlayer. Related to dre team-builder role is that of the team player. Threebehaviors ofteam players are:a. displaying appropriate personal conductb. cooperating with otheiunits in the organizattonc' displaying loyalty to superiors by supiorting their plans and decisions fully

7 ' Technical problew soher. rt is. particularly important for supervisors and middlemanagers to help team members solve ie.htrl."t problemsl Two activities con-tributing to this role are:a. serving as a technical expert or adviserb. performing individuar contributor tasks on a regular basis, such as making sarescalls or repairing machinery

B' Entreprenewr. Nthoughnot serf--emproyed, managers who work in rarge organiza_tions have some responsibility for suggesting innovative ideas or furthering thebusiness aspects of the firm. Thr.. .nlripreneurial leadership role actiyities are:a' reading trade pubrications and professionar journals to keep up with what is.

happening in the industry and professionb' talking with customers or otheri in the organ izationto keep aware of changingneeds and requirementsc. getting involved in situations outside the 'nit that could suggest ways ofimproving the unit's performance, such as visiting other firms, attending pro_fessional meetings or trade ,ho*s, and participating in educational programs

LEADERSHP ROLES 15

9. Strntegic plnntcer' lbp-level managers engage in strategic planning' "t:"ttlTlt::^d

by input from others throughout the org-anization' Carrying out the strateglc-

planner role enables dre manager to practile strategic leadership' Specific activities

involved in this role include:

a. setting a vision and direction for the organization

i. napiig the firm deal with the external environment

.. ft.ipi"! develop organizational policies

A common thread in the leadership roles of a manager is bat the managerial leader

in some way inspires o, irno.r.., oah..r. An analysis ln the Hnrt,ord' Bwsirues Rev'iew

concludedthat themostbasicro lefor .o,po,* . l .ud. , , is tore leasethel rumanspir i ttlratmakesinitiatrve,creativity,andentrepre,'.o''r'ippossible.22Animportantpracticalimplication i, tn"t ,,'"r.1!..r1. .*rVf"u.i .*

"t.r.iri leadership' For example) a team

leader can make an i-plrt"r-rt contribution to the fum's thrust for quality by explain-

ing to team members'ffi;;ffiL.Grit"titns in a mailing list' Leadership Skill-

Building Exercise I r fiorrrd., additional insights into the various leadership roles'

up to this poirrt *"tuue described.t-r. nl.riring of leadership, how leadership affects

organizational performance, and the many n.riui",i.r carried out by leaders' You have

had an opporturuty to explore your attirudet to**a occupying the leadership role' We

;;; fu.Jh;. personalize informanon about leadership'

oli?41"61r;fr)a#:Bt!w'#t/atts4l;#li/;;tlttF436':t#t&ffn

IDENTIFYING LEADERSHIP R'LES

npanv' Inc' ' AJlen Questrom del iv-Three months into his iob at I'C' Penney Col

:JJJ,'ffi''il ;;k ro it. i. is the.Quest,o''' *'v' dole out the broad vision

*x*?:*ri;:*i1;ru"n:J:tn1-Tiiiltl:'-; jril""""',"U,Iltaking any guarantees, but he was.collrtlble being captain' He asked employ-

".1*-r'"we-rehelping,:;,r",t":iilt:lt.T:It,:.:tiff ';;",i:J::l':ff ";2.

iTlftr'lf'T'H:'J. chier executi''r' "rn"' a*;"g n'.' i''t"ui'* 't ;; ';*

pany's Plano. Texas, nt"Jq"""t 's' "My job is to "' iht

objectives and get peo-

: *t*":** ;*u'u-:tTm:qs-qimifl "i:':,','"? .';ibrought that company out of bankrup"V Ig

acquired the Macy's and Broadway

chains, which gave Federared a sfong market 'hn" up and down both coasrs' The

veteran retailer h-' b'* ';;;;;il;liv"" ..u"o*'::"Ti.:i::ltors for vears'

Part icular ly impressivehasbeenrr l l .auir i tytotrrrnarolLn;|prest igiousstoresthatn"". r"u." on hard

:*itit *;; i" Federated' Questrom helped revive

"'ilili*T:i'H:.-il:["m raced,on f '- 1s, I I :. l:: ::o^'s th at some crit-

ics thought that its fhi;; ' were tired and its piitt ' *t" too,high' Retail ana-

lysts Felt that rhe Ott*ttt t'n"ti"""gt "t

ltt"ty *" to redefine what the *,?:1,::;,

16 CHAPTER 1 /THE NATURE AND IMPORTANCE OF LEADERSHIP

about. Questrom emphasized rhat the company care rs ro the broad middle mar-ket,.where the bulk of consumers are found. Penney's national presencet a goodcatalog, and an online business are also assets. But analysts at Morningstar.comwere particuJarly harsh about the problems facing Penney and Quesrrom:

.,The

company's problems are nothing short of humongous, and include an ineffi-

;ll.Hfl:?'l-'l:::*:JH::J::T'' or.enngs' a stodgv brand name' and a

Questrom said. he believed in the J.C. Penney brand and was rrying to gerback to J.C. Penney's roors as the depart-.nt ,tor. of choice for middle-incoleAmericans. (1.C. Penney also owned the Eckerd drugstore chain before sell ingall the stores in 2004.) But he was not sentimenral. and he was not wedded toideas.that had not worked. In November 2000. I.C. Penney reported its f irstloss from operations in the history oF the company. The retailer, which was

l#::t.j:?,J,ixiiiil;las being carred a dinosaur' Questrom had this ro sav

I- spend time thinking about gerring this company in order. lV1eat diffe rencedoes it make if i t 's 100 or l0 or 20) What's meaningful to me is whetherour stores are current. I wo_uld l i j<e this_company to be successftrl on itsl00th anniversary. I 've only been here a few -onrhr, and I see a very loyalbur an unhappy group ofpeople.

Questrom said the only way to boost morale was to start making moneyagain. lr.ofit would tal<e care of the stock price as well. Since ttre mid-lqq0s,the retailer had lost cusromers to discounr chains such as Target and Wal-Mart and to moderare-pr iced rera i lers, inc luding Kohl 's ana 5 la Navy, asthey had expanded nationwide. Becoming profitable was going to be painfulbecause it would mean change. Questrom said. To offer comperit ive prices.to

*.:"t.::lrili i;ff"t needed a more competitive cost st-rucrure, which

- J.C- Penney's department srores had to have rhe right assortmenr of mer-chandise at competitive prices. The only way to do that was to centralize thebuying decisions. Headquarters would pick and deliver the merchandise, andstore pers.onnel wortld focus on running the stores. Questrom said that J.C.Pennev fell behind its competitors when it did not centralize sooner. It was nolongei ef'f icient to have I,150 stores each making rhar many decisions aboutmerchandise. It was slow, expensive, and confusing ro the customers. It a-[so pre -vented tJle company from developing a national message.

Questrom said that some of'the immediacy of having ve ndors luocldng ony_our door every day was lost when the company moved to Dallas from NewYork in 1988. "We have to be aware of what's happening in the fashion worldand bring that to middle America ar grear values."'He .oiride.ed addinf offices

18 CHAPTER 1 /THE NATURE AND IMPORTANCE OF LEADERSHIP

1 The Satisfactions and Frustrations of Being a Leader

The term lend,er has a positive connotation for most people. To be called a leader is

generally better than to be called a follower or a subordinate. (The term follower hx

virtually disappeared in organizations, and the term swbord,innte has fallen out of

favor. The preferred term for a person who reports to a leader or manager is team

rnewber, group rwerwber, or assoc'iote. Researchers, however, continue to use the terms

swbord,inate andfollower for technical purposes.) Yet being a leader, such as a team

leader, vice president, or COO (chief operating officer), does not always bring per-

sonal satisfaction. Some leadership jobs are more fun than others, such as being the

leader of a successfi.rl group with cheerflrl team members.Because most of you are contemplating becoming a leader or moving further into

a leadership role, it is worthwhile to examine some of the potential satisfactions and

frustrations many people find in being an organizational leader.

The types of satisfactions that you might obtain from being a formal leader dependon your particular leadership position. Factors such as the amount of money you arepaid and the type of people in your group influence your satisfaction. There are sevensources ofsatisfaction that leaders often experience.

l. A feeli,ng of power and. prestige. Being a leader automatically grants you some

power. Prestige is forthcoming because many people think highly of people who

are leaders. In some organizations, top-Ievel leaders are addressed as Mr., Mrs., orMs., whereas lower-ranking people are referred to by their surnames. Yet manyleaders encourage others to call them by their first name.

2. A cbwnce to belp othersgrow and' d'evehp. A leader works direcdy with people, often

teaching them job skills, serving as a mentor, and listening to personal problems.

Part of a leader's job is to help other people become managers and leaders.

A leader often feels as much of a "people helper" as does a human resource man-

ager or a counselor.3. High imcowe. Leaders, in general, receive higher Pay than team members, and

executive leaders in major business corporations typically earn several million dol-lars per year. A handfirl of business executives receive compensation of over $100million per year. If money is an important motivator or satisfier, being a leader has

a built-in satisfaction. In some situations a team leader earns virtually the sameamount of money as other team members. Occupying a leadership position, how-ever, is a starting point on the path to high-paying leadership positions.

4. Respect and stwtws. A leader frequendy receives respect from group members. IIeor she also enjoys a higher status than people who are not occupying a leadership

role. Status accompanies being appointed to a leadership position on or off

the job. \4hen an individual's personal qualifications match the position, his or her

status is even higher.5 . Good. opportwn ities for ndvnncernent. Once you become a leader, your advancement

opportunities increase. Obtaining a leadership position is a vital first step for careeradvancement in many organizations. Staff or individual contributor positions help

n

rs.

i *dldol-lloor nasFamebot '

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THE SATISFACTIONS AND FRUSTRATIONS OF BEING A LEADER 19

broaden a person's professional experience, but most execudves rise through a

managerial Path.6. Afeetng of "being iru on, things.A side benefit of being a leader is that you receive

more inside information. For instance) as a manager you are invited to attend

management meetings. In those meetings you are given information not passed

ulorrg"to individual clntributors. One such tidbit might be plans for expansion or

downsizing.7. An opportwnity to control lnuney and. other resharces. A leader is often in the posi-

tion of helping to prepare u i"purt-".tt budget and authorize expenses. Even

though yo.t .unno, spend this money personall5 knowing that your judgment

on financial matters is trusted does provide some satisfaction. Many leaders in

both private and public organizations control annual budgets of several million

dollars.

About one out of ten people in the work force is classified as a supervisor, admin-

istrator, or manager. Xoa .u"ry one of these people is- a t11e leader' Yet the prob-

lems these people experience ofa.n ,a.- from the leadership portions of their job'

Many individual contributors refuse to accept a leadership role because of the frus-

trations they have seen leaders endure. Theie frustrations include the following:

|, Too rnwch unc\mpensa,ted' owrt,iwe. People in leadership jobs are usually expected

to work longer hours than other employees. Such unpaid hours are calle'd casual

overtime. ?eople in organizational leadership positions ln5atty spend ab_out fi{ty-

five hours pe, w..k *oiking. During peak periods of peak demands' this figure can

surge to eightY hours Per week'

2. Tbi rnany zhrnd,ncha.ilt would take several pages to list all the potential problems

leaders face. Being a leader is a good way to discover the validity of Murphy's law:

,,If anything .* go *org, it -ili." A leader is subject to a batch of problems involv-

ing people and thrngs- tri*y p.opte find that a leadership position is a source of

stress, and many managers experience burnout'

3 ,Noteruowgbnwthor ' i ty t0ca ' r ryowtrespons' ib i l i ty .Peop|e inmanager ia lposi t ionscomplain"repeatedly ih"t th"yi.. held responsible for things over which they have

Iittle control. As a ieader, you might be expected to work with an ill-performing

team member' y., yoo tu.t ttt" p"iott to fire him.or h^er' Or you might be expected

to produce higir-quality service with too small a staff and no authority to become

fully staffed.4. Loneliness. As Secretary of State and former five-star general colin Powell says,

,,Command is lonely.'; The higher you rise as a leader, the lonelier you will be

in a certain ,e.,.re. i""dership limits the number of people in whom you can

confide. It is awkward to confide negative feelings about your employer to a

team member. It is equally awkward io complain about one group member to

another. Some people in leadership positions feel lonely because they miss being

"one of the gang."

S. Too **ry priblr*, i.nvolvi.ng people. hmalor frustration facing a leader is the num-

ber of human resource pio'Ut..nt requiring action. The lower your leadershiphelp

20 CHAPTER 1 /THE NATUREAND IMPORTANCE OF LEADERSHIP

position, the more such problems you face. For example, the office supervisorspends more time de aling with problem employees than does the chief informa-tion officer.

6. Too wouch otgnn'izationnlpolitics. People at all levels of an organizatton, from theoffice assistant to the chairperson of the board) must be aware of political factors.Yet you can avoid politics more easily as an indMdual contributor than you can a.sa leader. As a leader you have to engage in political byplay from three directions:below, sideways, and upward. Political tactics such as forming alliances and coali-tions are a necessary part of a leader's role. Another troublesome aspect of organ-izational politics is that there are people lurking to take you our of the game,particularly if you are changing the status quo. These enemies within might attackyou directly in an attempt to shift the issue to your character and style and avoiddiscussing the changes you are amempring to implement. or, your superiors mightdivert you from your goals by keeping you overwhelmed with the details ofyour change effort.23 In addition, backstabbers may agree with you in person butbadmouth you to others.

7 . Tbe purswit of conflictitcg goals. A major challenge leaders face is to navigate amongconflicting goals. The central theme of these dilemmas is attempting to granr orh-ers the authority to act independently, yet srill getting them aligned or pullingtogether for a common purpose.24 Many of the topics relating to these conflictinggoals are discussed at later points in the text.

college.hmco.com/pic/dubrin5e

@ o xNowrnDGB BANr(: A table of these dilemmas as identified by a group ofbank executives can be found online in the I(nowledge Bank section of the webiitefor this text.

8' Being perceited' as wrcetbical, especially if yow are q, cltlpll/nte execwtiye. The manycorporate financial scandals made public in recent years have led to extreme per-ceptions that CEOs, in particular, are dishonest, unethical, and almost criminal intheir behavior. Even if95 percent ofcorporate leaders are honest and. devoted totheir constituents, the leader still has to deal with the possibility of being perceivedas dishonest.

1 A Framework for Understanding LeadershipL

Many different theories and explanations of leadership have been developed becauseofthe interest in leadership as a practice and as a research topic. Several attempts havebeen made to integrate the large number of leadership theories into one compre-hensive framework.2s The framework presented here focuses on the maior sets ofvari-ables that influence leadership effectiveness. The basic assumption underlying theframework can be expressed in terms of a simple formula with a profound meaning:

L : f ( 1 , Bm, s )

The formula means that the leadership process is a function of the leader, groupmembers (or followers), and other situational variables.26 In other words, leadershipdoes not exist in the abstract but takes into account factors related to the leader, ttreperson or persons being led, and a variety of forces in the environment. A charismatic

IP"-pl tn

P.:Er\'ec

A FRAMEWORK FOR UNDERSTANDING LEADERSHIP 21

FtcuRE t-z A Framework for Understanding Leadership

Source: Managing Today! by Stephen P Robbins, O 1997. Reprinted by permission of Prentice-Hall, Inc.Upper Saddle River, N.J.

and visionary leader might be just what a troubled organization needs to help it

achieve world-class success. Yet a group of part-time telemarketers might need a more

direct and focused type of leader to help them when their telephone calls mosdy meet

with abrupt rejection from the people solicited.The m-odel presented in Figure l-2 extends this situational perspective.2T Ac-

cording to this model, leadership can best be understood by examining its key vari-

ables: leader characteristics and traits, leader behavior and style, group member

characteristics, and the internal and external environment. At the right side of the

framework, leadership effectiveness refers to attaining desirable outcomes such as

productivity, quality, and satisfaction in a given situation. Whether or not the leader

is effective depends on the four sets of variables in the box.

Beginning at the top of the circle, lead.er chnracteristics nnd' traits tefers to the

inner qualities, such as self-confidence and problem-solving ability, that help a leader

function effectively in many situations. Lead,er behavior and' style refers to the activi-

ties engaged in by the leader, including his or her characteristic approach, that relate

to his or her effectiveness. A leader who frequendy coaches group members and prac-

tices participative leadership, for example, might be effective in many circumstances.

Growp wetmber chnracteristics refers to attributes of the group members that could

have a blaring on how effective the leadership attempt will be. Intelligent and well-

motivated group members, for example, help the leader do an outstanding job. The

internal aid, exiernal entironwent also influences leadership effectiveness. A leader in

a culturally diverse environment, for example, will need to have multicultural skills to

be effective. All of the topics in this text fit somewhere into this model, and the fit will

be more obvious at some places than at others. Table l-2, on the following page' out-

lines how the elements of the leadership model line up with chapters in the text'

[ur.ihale

[Pre-f.-i-I the

Fiog,I

; the

tlc

22 cHAprER 1 /THE NATURE AND tMpoRTANcE oF LEADERSHTp

Relationship Between Chapter Topics and the Framework forUnderstanding Leadership

Leader characteristicsand traits

Chapter 2, "liaits, Motives, and Characteristics of Leaders"

Chapter 3, "Charismatic and Tiansformational Leadershio,,Chapter 6, "Leadership Ethics and Social Responsibility,,Chapter 11, "Creativity, Innovation, and Leadership,,

Chapter 12, "Communication and Conflict Resolution Skills"Leader behavior and style chapter 4, "Leadership Behaviors, Attitudes, and styles',

Chapter 6, "Leadership Ethics and Social Responsibilitv"Chapter 8, "lnfluence Tactics of Leaders"

Chapter 9, "Developing Teamwork"Group member

characteristicsChapter 5, "Contingency and Situational Leadership"

Chapter 10, "Motlvation and Coaching Skills"Internal and external

environmentChapter 13, "Strategic Leadership and Knowledge

Chapter 14, "lnternational and Culturally Diverse Aspectsof Leadershio"

7, "Power, Politics, and Leadershio"

The arrows connecting the four sets of variables in Figure l-2 suggest a reciprocalinfluence among them. Some of these linkages are stronger than others. The mostpronounced linkage is that a leader's characteristics and traits will typically influencethe leader's style. If a given individual is extroverted, warm, and caring, it will be nat-ural for him or her to adopt a people-oriented leadership style. enoth., li.rkug. is thatthe group members' characteristics might influence the leader's style. If the membersare capable and self-sufficient, the leader is likely to choose a leadership style thatgrants freedom to the group. rt will be easier for the leader to empowei these peo-ple. A final linkage is that the internal and external environment can influenci ormediate the leader's traits to some extent. In an environment in which creativity andrisk taking are fostered, leaders are more likely to give expression to their tendenciestoward creative problem solving and risk taliing.

I Skill Development in Leadershipt-

Leadership skills are in high demand. Executives seeking candidates for high-levelmanagement jobs list leadership skills as the top attributes they want. After thesecome industry-specific experience and functionaly'echnical expertise.2s Leadershipskills are also sought in candidates for entry-level professional positions. Althoughstudents of leadership will find this information encouraging, developing leadership

Chapter 15, "Leadership Development and Succession,,

SKILL DEVELOPMENT IN LEADERSHIP 23

skills is more complex than developing a structured skill such as sending photos overthc Internet. Nevertheless, 1rs1 can develop leadership skiils by studying this text,rvhich follows a general learning model:

L Conceptwnl knowled.ge and. behnyiot,nl gui,delines. Each chapter in this text presentsuseful information about leadership, including a section titled "Guidelines forAction and Skill Development."

2. Conceptual oruforwation d,etnonsh,ated by exawples and. brtef descriptions of lead.ersin action. Much can be learned by reading about hor.v effective (or ineffective)Ieaders operate.

3. Experiential exercises. The text provides an opportunity for practice and personal-ization through cases) role plays, and self-assessment quizzes. Selfquizzes areemphasized here because they are an effective method of helping )rou personalizedre information, thereby linking conceptlral infbrmation to yourself. For example,

),ou will read about the importance of asserti\reness in leadership and also completean assertil'eness quiz.

4. Feed.back on shill wti.lizatiow, or perfotrwance, frow others. Feedback exercises appearat several places in the text. Implementing some of the skills outside of the class-room will provide additional opportunities for feedback.

5. Pr"act'ice im noturnl settings. As just implied, skill development requires active practice. A given skill has to be practiced many times in natural settings befbre itbecomes integrated comfortably into a leader's mode of operation. A basic prin-ciple of learning is that practice is necessarl, to develop and improve skills. Sup-pose, for example, that you read about giving advice in the form of qucstions, asdescribed in Chapter 10. If you practice this skill at least six times in live settings,you will probably have acquired an important new skill for coaching others.

Leadership Skill-Building Exercise 1-2 gives you the opportunity to begin develop-ing your leadership skills systematically

IVIY LEADERSHIP PORTF0L|0 i2.' l i i i : , i i :,.;:::

Here, we asl< you to begin developing a leadership porrficl io that wil l be a per-sonal docume nt c l f 'yorr r leadership capabi l i t ies and exper iences. In each chapter .we wiU recommerrd nerv entries firr 1'our portfolio. At the same time, you areencouraged ro use your imaginat ion in dctcrmin ing rvhat const i tu tes a sui tableaddition to your leadership portfolio.

We suggest you begin your portfolio with a personal mission statemcnt thatexplains the type of ieadership )rou plan to practice. An example might be, "1intcnd to become r well-respected corporate profussional. a kcy mcmber of ahappy and healthl 'familv, and a contributor to my communiry. i aspirc ro leadmany people toward constructive activit-ies." Include your job resumd in yorrrportfolio. and devote a special section to leadership experiences. These expcri-ences can he frorn the job. courmuniry and religious acrivit-ies. and sports. lSeeLeadership Sel f -Assessrnent Quiz I -2. )

24 CHAPTER 1 /THE NATURE AND IMPORTANCE OF LEADERSHIP

THE LEADERSHIP EXPERIENCE AUDITReaders of this book vary consid.erably, in their leade rship, managerial, and super-visory experience. Yet even readers who have not yer occupied, r"i-"11."1.,ship position may hcve had at leasr a rasre of, being a leader. Use the following

::::,: l ' : ::, ' :* any possible teadership e*peri.nJ., y", ,,-, ighi h;;;J;;:

lt "]|on]ui.liJ',"r..*nip

position,.such as vice p-resident. department head.manager, assistant . lnt"r,.r"rm leader, group leader, or crew chiel.

t ::'J:1,,f;:tniT:iy#J,lil"o

to take care ora probrem' arthough I was

T.t

l:'l

f-L

n

t t

L__.1

ff::il :TH;',:':llli,.o.,"n."Held ff ice in a club at high school, career school, or college

Was editor of a campus newspaper or section

:rrrn,r.l a study group for a course

of the newspaper such as sports

Organized an ongoing activiry to sell merchan, 6,. Auon. Md K";, or Tupperware

u"rdise at people's homes' such

:;i=: : .-,:,,.,"1:' :: : :.#i::T,T:H ;;T'"Organized a vacarion trip for friends or famil

ffi?ff:T?:i::::;,ili',';'"'n "' uv t''tp;Jg peopre out ora burning

x"i:: #::i:j *:g demands on a company o*he sovernmen,Organized a group ofl<Jisabled senior cirize nfriends

to he lp out people in need' such as physically

l : I

l t

nuf . ] lU

I Other:

INTERTRFTATIoN The more experiences you checked, the more leadership .*p.. i*you already have under your belt . Leadership experience ofany rype ca'be valuable in

:H::? ;:,T:i ::j,':':,ffioj: ;:$:T::nT,::: HT;:';,'*n c EOs i n a v a rie ry

FOLLOWERSHIP: BEING AN EFFECTIVE GROUP MEMBER 25

@ O XNOWf,3DGE BANK: contains a Leadership Skill-Building Exercise that

*ill giu. you more insight into the multidimensional nature of effective group mem-

bership.

: Being an Effective GrouP Member

To be an effective leader, one needs good followers. Leaders cannot exist without fol-

lowers.2e fu we mentioned at the outset of this book, the wordfollowerssuffers from

political incorrectness, yet it is a neutral term as used by leadership researchers' Most

tf the topics in our study of leadership are aimed at inspiring, motivating' and influ-

encing grorrp -.mbers to want to achieve organizational goals' It is also valuable,

ho*evei to focus on two key aspects of being an effective group member: the per-

sonal characteristics of productive followers and the importance of collaboration

between leaders and followers.

As observed by Robert E. Kelley, effective followers share four essential qualities:3o

L Self-rnnnagewent. The key to being a good follower is to think for oneself and to

work well without close supervision. Effective group members see themselves as

being as capable as their leaders.

2. Coirwitrnent.Effecnve followers are committed to something beyond themselves,

be it a cause, product, department, organization, idea, or value. To a committed

group membei, the leader facilitates progress toward achievi,ng a goal.

Z."Co*ptterce nnd. focws. Effective followers build their competence and focus their

efforts for maximum impact. Competence centers on mastering skills that will be

useful to the organization. Irss effective group members rarely take the initiative

to engage in training and development'

4. Courage. Effective follo*... establish themselves as independent, critical thinkers

and fight for what they believe is right. A good follower, for example, might chal-

lenge the company's policy of taking ninety days to make good on accounts

puyuUt., or of iecruiting key people almost exclusively from people with demo-

graphic characteristics similar to those_ of top management'

The above list is illustrative, since almost any positive human quality would con-

tribute directly or indirectly to being an effective group member or follower.

Another way of framing the qualities of effective followers is to say that such fol-

lowers display the personal characteristics and qualities of leaders. Although leaders

cannot b. e"p..t.d to change the personalities of group members, they can take

steps to .rr.orr."g" the above qualities. Interventions such as coaching, empower-

-Jrt, ,rrpportive communication, and frequent feedback would support effective

followership.

26 CHAPTER 1 /THE NATUREAND IMPORTANCE OF LEADERSHIP

A key role for followers is to collaborate with leaders in achieving organizational

fu described by leadership guru Warren Bennis, the postbureaucratic organizationtype of organization that came after the bureaucratic era, such as team-basedzations) requires a new kind of alliance between leaders and the led. \44ren high-

leaders do not make all of the decisions but solicit input from knowledgeable

members, leaders and followers work together more closely. In the words of

Today's organizations are evolving into federations of networks, clusters, cross-

functional teams, temporary systems, ad hoc task forces, Iattices, modules, matrices-almost arything but pyramids with their obsolete TOPdown leadership. The new leaderwill encourage healthy dissent and values those followers courageous enough to say no-

A related ooint here is that the new leader and the led are close allies. Great lead-

ers are made by great groups) every organizational member to contribute energy and

talent to help leaders carrv out their roles successfullY.

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Leadership is the ability to inspire confidence in andsupport among the people who are needed toachieve organizational goals. Leading is a major partof a manager's job, but a manager also plans, organ-izes, and controls. Leadership is said to deal withchange, inspiration, motivation, and influence. Incontrast) management deals more with maintainingequilibrium and the status quo. An important cur-rent development is to regard leadership as a long-term relationship, or partnership, between leadersand group members.

Many people attribute organizational perfor-mance to leadership actions. Some research evidencesupports this .widely accepted view. Others arguethat certain factors in the work environment, calledsubstitutes for leadership, make the leader's rolealmost superfluous. Among these factors are closelyknit teams of highly trained workers, intrinsic satis-faction with work, computer technology, and pio-fessional norms. Another antileadership argument isthat the leader is irrelevant in most organizationaloutcomes because the situation is more importantand the leader has unilateral control over only a fewresources. Moreover, since new leaders are chosenwhose values are compatible with those of the firm,those values actually are more important.

Complexity theory argues that leaders and man-agers can do litde to alter the course of the complexorganizational system. The system, rather than the

leader, dictates that all companies ultimately die.Examining the roles carried out by leaders con-

tributes to an understanding of the leadership func-tion. Nine such leadership roles are the figurehead,

spokesperson, negotiator, coach and motivator,team builder, team player, technical problem solver)entrepreneur, and strategic planner. An importantimplication of these roles is that managers at everylevel can exert leadership.

Leadership positions often are satisfiiing becausethey offer such things as power) prestige, the oppor-tunity to help others, high income, and the opportu-nity to control resources. At other times being aleader carries with it a number of frustrations, suchas insufficient authority, having to deal with humanproblems, and too much organizational politics. Theleader also has the difficult task of balancing work-

ers' need to be independent with their need to com-mit to a common purpose .

The framework for understanding leadership pre-sented here is based on the idea that the leader-ship process is a function of the leader, groupmembers, and other situational variables. According

Summary

Il lplI gl,.*

!nu':: eiorg:::-ph--r"db qrr-.+lenrI::,:1

r*-r.lel. leadership can best be understood byimmng. irs key variables: leader characteristics and

b.a'ler behavior and style, group members-tics, and the internal and external envi-

Leadership effectiveness is dependent on-.ers of variables.

iership skills can be developed by following alearning model that involves acquiring con-

- knos'ledge, reading examples, doing experi-

DISCUSSION QUESTIONS AND ACTIVITIES 27

ential exercises, obtaining feedback, and practicingin natural settings.

To be an effective leader, one needs good follow-ers wit-h characteristics such as self-management,commitment, competence and focus, and courage.A key role for followers is to collaborate with leadersin achieving organizational goals. The postbureau-cratic organization requires a new kind of alliancebetween leaders and the led.

Key Terms

Phip

ip theory

I O Guidetines for Action and Skitt Developmentl_

1i,*a amounts of information have been gathered.urrtr.'ut leaders and leadership, and many differentllc;*lership theories have been developed. Many lead-::ship research findings and theories are confusing .

i:'J contradictory. Nevertheless, from this thicket of-^:brmation emerge many useful leadership conceptsr:d techniques to guide you toward becoming a:ore effective leader.

As you work toward leadership effectiveness,irst be familiar with the approaches to leadership

1 Discussion Questions and Activitiest_

l. S/hat forces in the environment or in socieryhave led to the surge in interest in the subject ofleadership in recent yearsl

2. In recentyears, there have been dozens offinan-cial scandals involving business executives (suchas the problems at Enron and Global Crossing).What impact has this information had on yourinterest in becoming, or remaining, a leader in abusiness setting)

3. Give an example of how you have exertedleadership on or off the job in a situation inwhich you did not have a formal leadership posi-

Attribution theory

Substitutes for leadership

Leadership efTectiveness

described in this text. Then choose the formulationthat seems best to fit the leadership situation youface. For example, if you are leading a team) reviewthe information about team leadership. Typicallyan effective leader needs to combine several lead-ership approaches to meet the demands of a givensituation. For instance, a leader might need tocombine creative problem solving and emotionalsupport to members to help the team reboundfrom a crisis.

tion. Explain why you describe your activity asleadership.

4. Vl/hat would a boss of yours have to do todemonstrate that he or she is an effective leaderand an effective managerl

5. Identify a business or sports leader who youthink is highly effective. Present your observa-tions to the class.

6. Based on an informal survey many people whowere voted "the most likely to succeed" in theirhigh school yearbooks became leaders later on intheir career. How can you explain this findingl

r -e.'i.ersi-1' :lLr -

hr lea,l-rg:1'and

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[d man-compler*rm the

[ . h e .brs con-rip tunc-urehead,on|alor,n solr-er,nPortantat eYery

; t'ecausec opPof-DPPortu-b'eing a

ms. suchh humanincs. Thetrg work-

I to com-

xhip pre-e ieader-[. grouPrcording

28 cHAprER 1 /THE NATURE AND tMpoRTANcE oF LEADERSHTp

7 . Mter reading this chapter, do you believe that aperson who is not a "born leader" still has agood chance of becoming an effective leaderfExplain.

8. Top-level leaders of major business corporarionsreceive some of the highest compensation pack-ages in the work force. lVhy are business leaderspaid so much)

9. S4rich of the nine leadership roles do r-myou are the most suited for at this stagecareerf Explain your reasoning.

10. In what way might being an effectirehelp prepare a person for becoming anleaderl

A fi"#;: o',i11',, ",1 j'Hf, ,' :g;'.lT #.1way, Inc. announced that it is.retre.ating fromthe consumer electronics world and returnrngto its original mission of marketing ilrson;t"T8:T;t;r,

objective is to fix our core-business,,,sals W^aV.n5 R. lnouye, who recently assumed tlrerole of chief executive. "People talk about multi-t11kinS, but in real life you have ro focus on one

$l"S "t, rime.' Inouye says that new deals with

PC retailers. Best Buy Co., Inc. and CompU.SAInc.; as well as a greater Focus on fast-growrng

::j:_b"rk .PCs, should

.attow the money-tosin[

company ro earn consisrent profits beginningnext year.

.

'id;. is a huge gamble for Gateway, which

has relied on consumer electronics-,o prop upprofit^margins at its once rhriving pC bus,ncss.But Gateway's consumer electronics sales neverov.ercame the drag fiom irs pC business, whichstill accounted for 72 percent of its revenue lastyear. Cateway losr a cumulative $2.4 billion in the

li::** years,

ls. :"1.'^ 9i".pp:d. to $3.4 biltiontrom a one-year high of $6.1 bil l ion.

. Gateway has suffered four failed resffucturings

in the past three years, all under the auspices offormer chief executive Ted Waitt, who iteppeddown as CEO in 20.04. This ri-e nro'und,Inouye, a veteran retail ing execudve, hopes to

PC maker eMachines, Inc. , whichacquired in 2004. There, he slashedconsol idat ing component suppl iers,qualiry and fiJling retail orders on rime.t ime of its acquisirion, eMachines emplolodI38 workers bur was consistentlv profitabhhad $l bil l ion in annual sales.

revive Gateway by applying rhe sameapproach thar he successfully used to rurn

Yet Gateway's new direction represens Iplete rurnaround from just four years ago.

So far at Gateway. Inouye has closed rhr188 of its .loss-plagued Gateway CoLrntrr-and outsourced manufacturing andservice. Gateway will continue to marketrelated products via the lnternet andsales, in addition to managing its neq.dea.bbig retailers.

The changes were made with rwo lofn'mind: (l) eventually ro unseat Hewlett-Co. as the leading sel.ler of home pCs, and Ibecome a $10 bil l ion business i lr the next

tL. _y.* "I don't think it's a big strerc[*CEO insists.

Waitt plunged into consumer electroniGateway's business fell victim to price u'ars iby Dell Inc. and Hewletr-packard(HP). Like Dell, Gateway was founded as aseller. But by the mid-l990s, the compamIaunched its own chain of showrooms to

LEADERSHIP CASE PROBLEM B 29

--J roo steep to mail ltain.

l ::. products and provide soFtware trainine::: lrs., Over time, those Gateway Cornr!s :::olphed.into sales of computers and high_- : . rumel 'e lect ronics. But Gateway was never: , make its retail outlers profita'ble, and as: c plummeted the expense of the stores

awal' lrom higher-margin consumer electronics

ffi also leave Gateway even less apt ro earn a

. Inouye says fhat Gareway already surpasses Hp

rn customer satislaction surveys and its new low_overhead approach wil l allow it ro profitablvundercur rhe much bigger pC and printei maker inthe retail marker. He expecrs ro besr Hp bv erablbing an "over 50 percenr.. share of the U.j. ietailsales as soon as the first quarrer of 2005. Hp cur_rently holds a 60 percenr share of rerail sales. com_pared wirh Gateway's 30 percent share.

Q U E S T I O N S

-. r re 's p lan now cal ls for expanding U.S.

=- :nd overseas saies ro achieve at ieast t ir i l l iou

5= :fi ' ;l1,l1l';11 iil.1.,.j:Tj.'" :[|;:s

nStr:rian

t aroundG:ieu'avrnses br=xiltsting- -\: the

1ed onlvtt'lc and

rhe last1- SIOTeS

uslomerPCs andkphoneals s-ith

eoals fuiPickardd 2 ; t othree to:h..' the

ia com-r- u'hennics asi ignitedDmpanya Crectur.. haddenon-

q-::_i----once the highest in the industry at 26 oer_*_ : of revenuc-to below Dell.s 9.5 percenr.L-;:-=ri lv now employs about I,800 workers. downr :: i,500 when Inouye rook ovcr. Much of the. ". cr head count comes from closing the Gateway

. . ln i rv s tores. lnoul ,e expla ins that lower:.:.cn\es wil l allow the company to be profitable:-- 'n uirh thin margrns of abour B percenr.

- Famously frugal. Inouye never spends more than

:t tor lunch, buys the cheapest grs for his cer, and_-_r\ been known to clip coupons for staples such as:',rp His fiather was a tomato nnd peaj Farmer in

I trf,iJiiSTlli ;"lHx.TilJ' ""'pving-;

iuba Ciry California. An uncanny abiliry to .*o".,ier hnancial details from opcradrg reports earnedrnouye the luckname ,,Wayne

Man,', after thenLrman calculator in the film Rain Man.

His talents and quirks not withsrandinq. somehusrness analysts chara*erize the CEO'silrrl ,ottusplace HP as quixotic (far_tetched,1. The shift

sJf,xi; J :;"5.:l Ttt J:,, # i::'j' :;her Gir l Scour r roop at age. l l ,

l . p . . r ;a .n i o f

the, Asian Studenr Associar ion in l r igh school .and the capta in of her .soccer team in ioth h ighschool and college. She also orgrnizecl , fooa

' il::ff1iru;:T:row'th Eoars that Inouve

' ffi,',*10-1;' J:.rff ^t':L jili]f ;, r,]::J$d urirrg Gateway's transition I

4. \4ftar leadership challengcs lace lnouve as he

ilffJ to impleme'r his turnaroun<l oF

i',",,tfi H#i##rpp#tiir,:"t?i,t:j;,*fl :flil,sl$"ifr iil j{i ##:il.t.s f ;ix-* ;:l:."'J T ",: t::il:i"t

rnc. rn rhe formar Terrbook via Copyrighr Ciearance

drive lor homeless people jn her hometown forthree consecut ive sumlners. So Lee bel ieved thatthc.se exper iences, in addidon to her formal edu_catron, were preparing her to be a corporateleader. Ar college Lee majored in iuformationsystemsandbusinessadminis t rat ion '

(cont inucrr t

30 cHAprER 1 / THE NATURE AND tMpoRTANcE oF LEADERSHTp

Lee 's f i rs t posi t ion i r r i r rdt rs t r r r r as a husincss

rnalvst nt I mcdiunr-s ize consul t i r rg f i r rn t l ra thelpcd c l ier r rs inrp lernent [argc-sc. r . lc s ls tcms srrchrs eurc lpr isc sof i r rare. She expla ined to l rc l ter r r rleader r t the orr lset th . r t shc n. rntcd to be p l lccdoD a rnJll irgelncnt tt 'rrcl( rJtlter Lllxlt rr tcchrricalt rack becruse she espi lcd to hccoming a corporafcexccutivc. Lee's term leirder explained, .,Jen, II tnon lorr l rc in a hurr l ' to ger a l rcad. Lors of capable people lre looltirrg ro r-[ irnb tlre ladder.. Brrr touf i rs t hnc to bui ld vour cx l .eer b1 pror ing that vouarc an outstandi r rg an.r lvst . "

Lce rhought . " l r loo l<s l i l<e rhe colnp.rn\ . n)x) 'r reed a l i t t lc conl inc i r rg rh l t I 'm le. rdership mate-r ia l , so I 'nr goi r rg ro d ig i r r aud pcr f .orm l i l<e astar . " Ar t l Lcc d id d ig in . mtrch ro rhc p leastr re o l 'l rcr c l icnts, her tc lm lcrdcr , . rnd l rer corror l<cr-s.Her f i rs t lbr r pcr forr r rarrce lppra is l ls n.cre out-s tarrd ing, ver the c() rnpan) nas st i l l not r .cr rdv toprumotc Jcn to e te lm lcrder posi t ior r . Lee's tcarnleadcr erp la incd, "Bob l the rcrrn lcadcr 's nrarr -ager l arrd I borh agree rhat 1 'orr are c lc , ing an our-standi r rg job, but prom() t ion\ ; r re hard to cornc bvi r r orr r conrpcnv thcse davs. Thc cornp.r r ry isshr in l< ing lnore thxn cxprrrd ing, so t r l l<s rboutp ron lo t i on a re a l i t r l c f u r i l e l i gh r r ro r r . "

Lec decidcd rhat i r r , rorrJd ra l<e I krng r inre lo beprornoted t ( ) t r tm lc ldcr or managcr . in hcr prcs-cnt compel l \ , so s l re hegrn ro r lu ic t ly loo l< lbr . rner ' r posi t ion i r r l rcr t ic ld . Her joh ht rnt proceecledmolc srr i f i lv thrr r she arr r ic ip ; r ted. Throrrgh asports c l t rb contact . Lee nas gr .arr ted l loh in ter-r ier r wi th a parrner in I larger c , rnsrr l t ing f innoffcring simillr serliccs. AJicr r scr.ies of f icrrr inter-r iens, Lee uas l r i red as e scnior business analvstpcr f icrming rvor l t on a s) 's te ln s i rn i ler to thc or . lcshe l rad l -ccrr uork i l rg rv i rh l 'or nro vears. Dur inghcr i r r tc lv iervs, Lec emph.rs izcd her god of occrr -pf ing a leaders l r ip posi r ior r as soon ls Lhc corr rprn l 'he l icred rh l t shc rvrrs readr ' f i r r sr rch a ro lc . Herf i rs t c l ient . rss igrrmeur, , tas hel l . i r rg r tealn o l 'con-sul tur ts i r rs t r i l a s f r te incomc rax cr l l cenfcr ' .

A l tcr . r onc-monl l t - lonq ot . icnt r t ior r rnd t r . . t in-ing progr ' . rnr . Lec rvas per lbrmiug L l i l lab le r rork r t

her nov employer. At the outsetl she reminde:her ncu lnanager l r rd lernr lcadcr lhat s l rc 1.1. . .tbr re. i thc marrrger ia l routc to r -cr r ra i r r ing in :t cchn i c , r l pos i r i o r r . AJ io ' s i r r non rhs o f ha rd no r * .Lec looked fornald ro her firsr f icrmal per-lb:-nrJ l rce cv i r lu . l r ior r . Hcl te lm leader- in lbr-med l rc :t l rar l rcr per fb lmancc r r . rs l rc f ter thau arcragc. hu:shor t o[outsterrd ing. Lee asl<ed lor rn erp l . rnat io : -of rrhv her perfonnarlce \vas not considered out-s t rnd ing . She i u l b r rned l r c r r eam le rdc r a r rd rnan -ager, " l r recd rn outst r l td i l lg rat ing to hc lp m.lch icrc nr l goal o l ' bccorni r rg , r lc . rder i r r oLr :a ' n m n a n \ /

The manager replied, "Our performancc eval-uations are based orr yepl contribution to thecompanv. We care much lcss about r.vriting per-fbrmance evaluations to help a senior businessrrualy 's t rer ic l r her cr recr gor ls . Besides, Jcrr .Vo r . r ' \ c n r tdc 1 'O r r I po in t e r ro r rgh l b t l u t r r an t i nsto be a ler . lcr i r r our f i r 'm. Lct vour per lormarrccsper l< fbr i rse l t . "

Thrt cveuing. fcrr rnet rr ith her fiancc. Kenrrerlr.to discuss hcr dilemnr.r.. "The problem, I(err. is rharthcv don' t gct i r . I 'n t lc . rdcrship marer ia l . and ther. lon ' t sce i t rc t . I 'm per fbrming rvel l rnd lc t r ing mrirrtenriorrs bc i<norr rr, but mr strafcg)' isn't rr.or.l<ing.Tlrc companl is rnissirrg our on .r golderr opi)orru-rrirv bv ltot Putl i lg me or1 r hst lca.icrsljp rracl<. Ihale to corr r i r rcc rhem of thei r en.or in judgmerr t , "

Kcnneth. l hurr r . r r r res() r r rcc speci . r l is t , repl ie t l ," l 'm l i s t e r r i ng t o vou . and I uan t t o g i ve 1 ' o r rgood adr ice. Lcr me bc objcct ive l rere dcspi re rheI . rc t th l t I love vou. Wlr i r r havc you dorrc lare l l top lovc to r i re complr r \ thr t vou are leadershipnra tc l i r l i "

Q U E S T I O N S

l . Who h rs t he p rob l cn r he rc : f en o r . rhc cousu l r -i r rg f i r rn i r r t lucsr ion)

2. What ldr icc crn lou of ler Jcn to help hcri r rcrcasc her charrecs of occtrpy ing a for .mallcrdership posi t ion i r r the comprnr I

.3 . Wh.rr is l or r r evaluat iorr o l ' the adr . icc I (erroffereci Jcrri