CIL_A7
LDR 6302, Current Issues in Leadership 1
Course Learning Outcomes for Unit II Upon completion of this unit, students should be able to:
2. Assess the differences between charismatic leadership and transformational leadership. 2.1 Evaluate the traits of charismatic and transformational leaders. 2.2 Predict possible drawbacks of charismatic and transformational leadership.
8. Develop a comprehensive personal leadership training plan that utilizes different leadership
techniques. 8.1 Identify individual attributes that contribute to one’s leadership skills.
Required Unit Resources In order to access the following resources, click the links below. Sandberg, Y., & Moreman, C. M. (2015). Common threads among different forms of charismatic leadership
(revised). Journal of Religion and Business Ethics, 3(2), 1–17. https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.ebscohost.com/logi n.aspx?direct=true&db=bth&AN=117564901&site=ehost-live&scope=site
Tatum, N. T., & Fogle, K. (2016, February). Transformational leadership. Training Journal, 30–32.
https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.ebscohost.com/logi n.aspx?direct=true&db=bth&AN=112847478&site=ehost-live&scope=site
Van Wart, M. (2015). Evaluating transformational leaders: The challenging case of Eric Shinseki and the U.S.
Department of Veterans Affairs. Public Administration Review, 75(5), 760–769. https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.ebscohost.com/logi n.aspx?direct=true&db=bth&AN=109116054&site=ehost-live&scope=site
Unit Lesson What does charismatic leadership look like? Charismatic leaders are passionate about their roles and are able to inspire others to be the same. These leaders have a clear vision and can communicate it well to others. Overall, charismatic leadership involves the ability to connect with people through a crisis or through vision. Charismatic leaders make others want to rise to their level and perform at their best. Does this type of leader make you think of someone you know or have worked with previously? Maybe it was even a sports coach. Consider the movie Remember the Titans when Denzel Washington delivers a very moving speech to his team in order to motivate them. If you are familiar with this movie, consider the ways the coach demonstrates charismatic leadership. How does Washington’s character use the Battle of Gettysburg for inspiration? If you are unfamiliar with this speech, you may watch the video below, which is optional. Mikedaquila. (2011, April 3). Remember the Titans – Coach Boone charismatic leadership [Video]. YouTube.
https://www.youtube.com/watch?v=HIeLiPjgAbQ What was so moving and so motivating about the speech? How was the power of team leveraged? Although this example is from a sports team in a movie, the very same concept can be applied to business. Think for a minute about corporate America. What do you know about it? Well, it is divided into many industry segments: technology, finance, retail, consumer durables, consumer non-durables, biotechnology, pharmaceuticals, health care, transportation (air, rail, truck, sea) utilities, oil exploration, and more. If you
UNIT II STUDY GUIDE
Charismatic and Transformational Leaders
LDR 6302, Current Issues in Leadership 2
UNIT x STUDY GUIDE
Title
would like more information, review the link below from Fidelity regarding the performance of sectors and industries. Fidelity. (n.d.). Sectors & industries overview.
https://eresearch.fidelity.com/eresearch/markets_sectors/sectors/sectors_in_market.jhtml Why are we asking you to look at a list of industry sectors and companies? Where is there value in this? This is not a stock market course. You are correct, but this is a course about leadership. The point here is to frame the big picture for you. How does this information relate to charisma and transformational leadership? Frame the big picture of the size of corporate America. Leaders in this arena make decisions every day in every sector. Leaders of these companies face huge challenges both internally and externally, and not everything goes as smoothly as planned. Showing you how big business leaders handle everyday challenges will illustrate the charisma and transformational leadership they possess. This translates to the company remaining competitive both internally (human capital, culture, recruiting, total quality management) and externally (global competition, economic changes, laws and regulations). By the end of this lesson, you will have an appreciation for the charismatic and transformational leader. As a student, you should consider the following questions right now:
• How many charismatic leaders are out there in corporate America?
• What industry, sector, and company do they lead, and do I use their product as a consumer?
• Who are they?
• What are their challenges?
• How are they solving them? Reflecting on corporate America, what characteristics of charismatic leadership do you believe you have, and in what areas do you need to improve? At this reflection point, you will begin to have an appreciation for this lesson. You will learn the information below in this unit:
1. You will be taught what the components of charisma are and how a leader uses them effectively. 2. You will conduct your own leadership analysis of your choice of a charismatic or transformational
leader so that you can learn about the challenges and processes these individuals use(d) to influence, change, and make circumstances better.
3. You will be exposed to a company that had to go through a turnaround and how that CEO had to come in and change/transform it. a. Where did he start? b. What were the challenges? c. How did he execute them? d. Finally, what were the end results?
Transformational Leadership and Continental Airlines Gordon Bethune was the Continental Airlines CEO in 1994 who took over the failing company from Frank Lorenzo, who ran the company and employees into the ground (Puris, 1999). Problems: A Salomon Brothers airline analyst noted that the company had fundamental problems. In fact, Continental lost money 12 of the last 16 years and declared bankruptcy twice (Puris, 1999). Approximately 50% of all flights had a negative cash flow (Puris, 1999). Markets were retained that were not making money or filling capacity. The company’s struggles included more than just financial problems. Company employees were abused and degraded to the point where employees ripped the Continental logo patch off of their uniforms (Puris, 1999). Also, due to the poor treatment of the employees, the company lacked employee involvement and commitment and had an image that customers did not support (Puris, 1999). People internally fought each other and hated management Solutions: Bethune used his background in the Navy and a positive strategy to bring success back to
LDR 6302, Current Issues in Leadership 3
UNIT x STUDY GUIDE
Title
Continental Airlines.
Click here to view the interactive slide on solutions. Click here to view the transcript of the slide on solutions.
When we discuss strategy, we must also discuss the six characteristics of Van Wart’s (2015) framework for the analysis of transformational leaders. Click the link below to view the characteristics that are listed on p. 761 in the article below. Van Wart, M. (2015). Evaluating transformational leaders: The challenging case of Eric Shinseki and the U.S.
Department of Veterans Affairs. Public Administration Review, 75(5), 760–769. https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.ebscohost.com/logi n.aspx?direct=true&db=bth&AN=109116054&site=ehost-live&scope=site
After reviewing the aforementioned characteristics, examine Bethune’s strategy for transforming the culture at Continental Airlines, which is described below (adapted from Puris, 1999):
Strategy Description
Fly to Win • A new scheduling plan for flying in high-traffic areas was created, and flights that were half- filled were eliminated.
Fund the Future • Bethune met with creditors (banks), restructured the debt, and convinced lenders that new leadership had a well-developed strategy that would be executed.
• This strategy required Bethune to lay off 1,500 workers to remain competitive (Puris, 1999).
Make Reliability a Reality • The culture had to be reconditioned.
• Bethune fired executives and staff who were not willing to adapt to new policies.
Monetary Rewards • Monetary rewards were given to employees whenever the company finished in the top five of on-time performance. This was a driving force in cultural change.
• Previous leadership cut out these bonuses, which saved $10,000 a year (Puris, 1999).
New Image • A new image was created; there were new uniforms, a new golden glove logo, new plane interiors, and new menus.
• Morale improved dramatically by treating people with respect.
So, what is the connection between Van Wart’s (2015) list on p. 761 and Bethune’s actions? Bethune had huge challenges internally and externally. He had strategy issues, logistics issues, personnel issues, and external image and debt problems. He compartmentalized each challenge into his strategy. Bethune certainly had a huge challenge from low-performing employees, and he motivated them by communicating with them and by listening, rewarding, and focusing them on the new plan—a plan that would win. Change was built on employee momentum, creative ideas, and success. End Results: Despite the rough road, Continental Airlines found success and had $1 billion in the bank with a $250 million revolving line of credit (Puris, 1999). Continental Airlines now has three dominant markets in Houston, Newark, and Cleveland (Puris, 1999). Employees are also much happier. As Bethune explained, success is not difficult once you are able to get people to work together toward a common goal (Puris, 1999).
LDR 6302, Current Issues in Leadership 4
UNIT x STUDY GUIDE
Title
What is your takeaway from this mini-case example? What is the “so what” factor of Bethune and Continental Airlines? Reflect on the readings that provide the framework and the insight into what charismatic and transformational leaders are about and how they are able to affect a company’s success.
References Puris, M. (1999). Comeback: How seven straight-shooting CEOs turned around troubled companies. Random
House. Van Wart, M. (2015). Evaluating transformational leaders: The challenging case of Eric Shinseki and the U.S.
Department of Veterans Affairs. Public Administration Review, 75(5), 760–769. https://libraryresources.columbiasouthern.edu/login?auth=CAS&url=http://search.ebscohost.com/logi n.aspx?direct=true&db=bth&AN=109116054&site=ehost-live&scope=site
Suggested Unit Resources In order to access the following resources, click the links below. The article below explains how leaders can use their passion to become more inspirational and charismatic. Beck, M. (2016). From leader to an inspiring leader. Leadership Excellence Essentials, 33(2), 40.
https://libraryresources.columbiasouthern.edu/login?url=http://search.ebscohost.com/login.aspx?direc t=true&db=bth&AN=112819568&site=ehost-live&scope=site
The article below focuses on strategies to keep an organization moving in a positive direction. This is an excerpt from Hoffman’s book American Icon: Alan Mulally & the Fight to Save Ford Motor Company. Hoffman, B. G. (2012). Inside Ford's fight to avoid disaster. Wall Street Journal - Eastern Edition. 259(56),
B1–B7. https://libraryresources.columbiasouthern.edu/login?url=http://search.ebscohost.com/login.aspx?direc t=true&db=bth&AN=72900986&site=ehost-live&scope=site
The article below covers charisma in great detail, including the benefits and drawbacks. Reading this article will give you the full picture of charismatic leadership. Owen, N. (2015, December). Charismatic leadership. Training Journal, 28–31.
https://libraryresources.columbiasouthern.edu/login?url=http://search.ebscohost.com/login.aspx?direc t=true&db=bth&AN=111382830&site=ehost-live&scope=site
The book below was referenced in the Unit II Lesson and covers the ways in which Gordon Bethune was a charismatic and transformative leader. Reading this book will show you the true power that leadership can have on an organization. Puris, M. (1999). Comeback: How seven straight-shooting CEOs turned around troubled companies. Random
House.
Learning Activities (Nongraded) Nongraded Learning Activities are provided to aid students in their course of study. You do not have to submit them. If you have questions, contact your instructor for further guidance and information. As you review the Van Wart (2015) article included in your required reading, ask yourself the following questions:
• Did the challenges Shinseki faced mirror the challenges that Bethune faced?
• Was Shinseki able to mobilize people and build follower commitment?
• Was there influence? How? Did Shinseki inspire confidence?
LDR 6302, Current Issues in Leadership 5
UNIT x STUDY GUIDE
Title
• What were Shinseki’s biggest challenges?
• Did Shinseki increase intrinsic value of effort and make work more appealing to employees?
• Did Shinseki excite, arouse, and inspire?
• A final note here is that there is never a guarantee something will work. It depends on a lot of things: timing, style, situation, environment, and luck.
• Finally, if you were Shinseki, what would you have done? Would you have done anything differently?