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Experience

SIXTH EDITION

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The Leadership Experience, Sixth Edition Richard L. Daft With the assistance of Patricia G. Lane

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To the spiritual leaders who shaped my growth and development as a leader and as a human being.

B R I E F C O N T E N T S

PART 1: INTRODUCTION TO LEADERSHIP 1 1. What Does It Mean to Be a Leader? 2

PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP 33 2. Traits, Behaviors, and Relationships 34 3. Contingency Approaches to Leadership 64

PART 3: THE PERSONAL SIDE OF LEADERSHIP 97 4. The Leader as an Individual 98 5. Leadership Mind and Emotion 134 6. Courage and Moral Leadership 166 7. Followership 194

PART 4: THE LEADER AS A RELATIONSHIP BUILDER 223 8. Motivation and Empowerment 224 9. Leadership Communication 258 10. Leading Teams 290 11. Developing Leadership Diversity 324 12. Leadership Power and Influence 358

PART 5: THE LEADER AS SOCIAL ARCHITECT 391 13. Creating Vision and Strategic Direction 392 14. Shaping Culture and Values 426 15. Leading Change 460

Name Index 491 Index of Organizations 495 Subject Index 499

iv Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Editorial review has deemed that any suppressed content does not materially affect the overall learning experience. Cengage Learning reserves the right to remove additional content at any time if subsequent rights restrictions require it.

C O N T E N T S

PART 1: INTRODUCTION TO LEADERSHIP 1 Chapter 1: What Does It Mean to Be a Leader? 2 The Need for Leadership 4

Leadership Defined 5

Everyday Leadership 6

The New Reality for Leaders 7 From Stabilizer to Change Manager 7

From Controller to Facilitator 9

In the Lead 9 From Competitor to Collaborator 10 From Diversity Avoider to Diversity Promoter 10

Leader’s Bookshelf 11 From Hero to Humble 11

Leader’s Self-Insight 1.1 12

Consider This! 13

How Leadership Differs from Management 13 Providing Direction 14 Aligning Followers 15

Building Relationships 15 Developing Personal Leadership Qualities 15

Leader’s Self-Insight 1.2 16 Creating Outcomes 16

Evolving Theories of Leadership 17 Historical Overview of Major Approaches 17 A Model of Leadership Evolution 18

Leadership Can Be Learned 20 Leader Fatal Flaws 20 Leader Good Behaviors 21

Leader’s Self-Insight 1.3 22

In the Lead 22

Mastering the Art and Science of Leadership 23

Organization of This Book 25

Leadership Essentials 26

Discussion Questions 27

Leadership at Work 27

Leadership Right–Wrong 27

Leadership Development: Cases for Analysis 28

Sales Engineering Division 28

The Marshall Plan 29

References 30

PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP 33 Chapter 2: Traits, Behaviors, and Relationships 34 The Trait Approach 36

Leader’s Bookshelf 37

Leader’s Self-Insight 2.1 39

In the Lead 40

Know Your Strengths 41 What Are Strengths? 41

In the Lead 42 Matching Strengths with Roles 42

Behavior Approaches 43

v Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Autocratic versus Democratic Behaviors 44

Consider This! 44 Ohio State Studies 46

Leader’s Self-Insight 2.2 47

In the Lead 47 University of Michigan Studies 48 The Leadership Grid 49

In the Lead 50 Theories of a “High-High” Leader 50

Individualized Leadership 52 Vertical Dyad Linkage Model 53

Leader’s Self-Insight 2.3 54 Leader–Member Exchange 54 Partnership Building 54

Entrepreneurial Traits and Behaviors 55

Leadership Essentials 56

Discussion Questions 57

Leadership at Work 57

Your Ideal Leader Traits 57

Leadership Development: Cases for Analysis 58

Consolidated Products 58

Transition to Leadership 59

References 61

Chapter 3: Contingency Approaches to Leadership 64 The Contingency Approach 66

Leader’s Bookshelf 67

Hersey and Blanchard’s Situational Theory 68

Leader’s Self-Insight 3.1 69 Leader Style 69

Follower Readiness Contingency 70

In the Lead 72

Fiedler’s Contingency Model 72

Leader’s Self-Insight 3.2 73 Leadership Style 73

Situation 74 Contingency Theory 74

In the Lead 75

Path–Goal Theory 76 Leader Behavior 77

In the Lead 78

Consider This! 79 Situational Contingencies 79 Use of Rewards 80

The Vroom–Jago Contingency Model 81 Leader Participation Styles 81 Diagnostic Questions 81

Selecting a Decision Style 83

In the Lead 86

Substitutes for Leadership 88

In the Lead 88

Leader’s Self-Insight 3.3 90

Leadership Essentials 91

Discussion Questions 91

Leadership at Work 92

Task versus Relationship Role Play 92

Leadership Development: Cases for Analysis 93

Alvis Corporation 93

An Impossible Dream? 94

References 95

PART 3: THE PERSONAL SIDE OF LEADERSHIP 97 Chapter 4: The Leader as an Individual 98 The Secret Ingredient for Leadership Success 100

The Importance of Self-Awareness 100 Leader Blind Spots 101

Personality and Leadership 101

In the Lead 102 A Model of Personality 102

Leader’s Self-Insight 4.1 103

Leader’s Bookshelf 106

Personality Traits and Leader Behavior 106

In the Lead 107

Leader’s Self-Insight 4.2 108 Values and Attitudes 109

Instrumental and End Values 109

Leader’s Self-Insight 4.3 110

In the Lead 111 How Attitudes Affect Leadership 112

Consider This! 112

vi CONTENTS

Social Perception and Attributions 113 Perceptual Distortions 114

Attributions 115

In the Lead 116

Cognitive Differences 116 Patterns of Thinking and Brain Dominance 116

Leader’s Self-Insight 4.4 118 Problem-Solving Styles: Jungian Types 120

In the Lead 121

Working with Different Personality Types 122

Leader’s Self-Insight 4.5 123

Leadership Essentials 126

Discussion Questions 127

Leadership at Work 127

Past and Future 127

Leadership Development: Cases for Analysis 128

A Nice Manager 128

Environmental Designs International 130

References 131

Chapter 5: Leadership Mind and Emotion 134 Leading with Head and Heart 136

Mental Models 136 Assumptions 138

Changing or Expanding Mental Models 138

In the Lead 139

Developing a Leader’s Mind 140 Independent Thinking 140

Leader’s Bookshelf 141 Open-Mindedness 142

Leader’s Self-Insight 5.1 143 Systems Thinking 144 Personal Mastery 145

Emotional Intelligence 146 What Are Emotions? 146

Why Are Emotions Important? 148 The Components of Emotional Intelligence 149

In the Lead 152

Leader’s Self-Insight 5.2 153

Leading with Love versus Leading with Fear 153

Leader’s Self-Insight 5.3 154 Fear in Organizations 154

In the Lead 155 Bringing Love to Work 156

Consider This! 156 Why Followers Respond to Love 157

Leadership Essentials 158

Discussion Questions 159

Leadership at Work 159

Mentors 159

Leadership Development: Cases for Analysis 160

The New Boss 160

The USS Florida 161

References 163

Chapter 6: Courage and Moral Leadership 166 Moral Leadership Today 168

The Ethical Climate in Business 168 Leaders Set the Ethical Tone 169

In the Lead 169

Leader’s Self-Insight 6.1 171

Acting Like a Moral Leader 172

Becoming a Moral Leader 173

Servant Leadership 175 Authoritarian Management 176 Participative Management 176 Stewardship 177 The Servant Leader 177

In the Lead 178

Leader’s Self-Insight 6.2 179

Leading with Courage 179 What Is Courage? 180

Consider This! 180

In the Lead 181

Leader’s Self-Insight 6.3 183 How Does Courage Apply to Moral Leadership? 183

In the Lead 184 Finding Personal Courage 185

Leader’s Bookshelf 186

Leadership Essentials 187

Discussion Questions 188

Leadership at Work 188

Scary Person 188

Leadership Development: Cases for Analysis 189

“What Should I Say?” 189

The Boy, the Girl, the Ferryboat Captain, and the Hermits 190

References 191

CONTENTS vii

Chapter 7: Followership 194 The Art of Followership 196

Learn to Manage Up as Well as Down 196 Managing Up Presents Unique Challenges 197

In the Lead 197

What Your Leader Wants from You 198

Styles of Followership 199

Leader’s Self-Insight 7.1 201

In the Lead 202

Strategies for Managing Up 202 Understand the Leader 202

Consider This! 203

Leader’s Self-Insight 7.2 204 Tactics for Managing Up 204

In the Lead 206

Leader’s Bookshelf 207

The Power and Courage to Manage Up 208

Sources of Power for Managing Up 208

Necessary Courage to Manage Up 209

In the Lead 210

What Followers Want from Leaders 211 Clarity of Direction 212 Opportunities for Growth 212

Frequent, Specific, and Immediate Feedback 213

Leader’s Self-Insight 7.3 214 Protection from Organizational Intrusions 215

Leadership Essentials 215

Discussion Questions 216

Leadership at Work 216

Follower Role Play 216

Leadership Development: Cases for Analysis 217

Waiting for Clearance 217

Jake’s Pet Land 218

References 220

PART 4: THE LEADER AS A RELATIONSHIP BUILDER 223 Chapter 8: Motivation and Empowerment 224 Leadership and Motivation 226

Intrinsic and Extrinsic Rewards 227 Positive and Negative Motives 228

Needs-Based Theories of Motivation 230 Hierarchy of Needs Theory 230

Two-Factor Theory 231

Leader’s Self-Insight 8.1 233

In the Lead 233 Acquired Needs Theory 234

Other Motivation Theories 235

Consider This! 235 Reinforcement Perspective on Motivation 236

Expectancy Theory 238 Equity Theory 239

Leader’s Self-Insight 8.2 240

Empowering People to Meet Higher Needs 241 The Psychological Model of Empowerment 241

Leader’s Bookshelf 242 Job Design for Empowerment 242

In the Lead 244 Empowerment Applications 244

Giving Meaning to Work Through Engagement 245

Leader’s Self-Insight 8.3 246

In the Lead 247

New Ideas for Motivation 248 The Making Progress Principle 248 Building a Thriving Workforce 248

Leadership Essentials 249

Discussion Questions 250

Leadership at Work 251

Should, Need, Like, Love 251

Leadership Development: Cases for Analysis 252

Commissions for Charlotte 252

Sun Spots 254

References 255

Chapter 9: Leadership Communication 258 How Leaders Communicate 260

Leader’s Self-Insight 9.1 262 Management Communication 262 The Leader as Communication Champion 262

Consider This! 264

Leading Strategic Conversations 264

In the Lead 265

viii CONTENTS

Creating an Open Communication Climate 265

Asking Questions 266 Listening 267

In the Lead 268

Leader’s Self-Insight 9.2 269 Dialogue 269

Communicating with Candor 271

Leader’s Self-Insight 9.3 272 The Power of Stories 272

Leader’s Bookshelf 273

Communicating to Persuade and Influence 274

Selecting the Correct Communication Channel 275 The Continuum of Channel Richness 275

In the Lead 277 Effectively Using Electronic Communication Channels 277

Nonverbal Communication 278

Current Communication Challenges 280 Leadership via Social Media 280 Being Crisis-Ready 281

In the Lead 281

Leadership Essentials 282

Discussion Questions 283

Leadership at Work 283

Listen Like a Professional 283

Leadership Development: Cases for Analysis 285

The Superintendent’s Directive 285

Hunter-Worth 286

References 287

Chapter 10: Leading Teams 290 The Value of Teams 292

What Is a Team? 292

Consider This! 293 Types of Teams 294

In the Lead 295

The Dilemma for Team Members 296

Leader’s Self-Insight 10.1 297

Leading a Team to High Performance 298

Team Processes 299 How Teams Develop 299

Leader’s Bookshelf 300

In the Lead 302

Team Cohesiveness 302

Team Norms 303

What Team Members Must Contribute 304 Essential Team Competencies 304

Leader’s Self-Insight 10.2 305 Team Member Roles 305

Leading a Virtual Team 306

In the Lead 307 Uses of Virtual Teams 308 Challenges of Virtual Teams 308

Handling Team Conflict 309 Types of Conflict 310 Balancing Conflict and Cooperation 310

Causes of Conflict 311 Styles to Handle Conflict 311

Leader’s Self-Insight 10.3 313 Negotiation 314

Leadership Essentials 315

Discussion Questions 316

Leadership at Work 316

Team Feedback 316

Leadership Development: Cases for Analysis 317

Decision Time 317

Devereaux-Dering Group 319

References 320

Chapter 11: Developing Leadership Diversity 324 Leading People Who Aren’t Like You 326

Leader’s Self-Insight 11.1 327

Diversity Today 327 Definition of Diversity 327 Changing Attitudes toward Diversity 328

In the Lead 329 The Value of Organizational Diversity 329

Challenges Minorities Face 330

Leader’s Self-Insight 11.2 331 Prejudice, Stereotypes, and Discrimination 331

The Glass Ceiling 332

Leader’s Bookshelf 334

In the Lead 334

Ways Women Lead 336

Consider This! 336 Women as Leaders 337

CONTENTS ix

Is Leader Style Gender-Driven? 338

In the Lead 338

Global Diversity 339 The Sociocultural Environment 339 Social Value Systems 340

Leader’s Self-Insight 11.3 341 Developing Cultural Intelligence 343 Leadership Implications 343

Becoming an Inclusive Leader 345

In the Lead 346

Ways to Encourage the Advancement of Women and Minorities 347

Employee Affinity Groups 348

Minority Sponsorship 348

Leadership Essentials 349

Discussion Questions 350

Leadership at Work 351

Personal Diversity 351

Leadership Development: Cases for Analysis 352

True to Myself 352

The Trouble with Bangles 353

References 354

Chapter 12: Leadership Power and Influence 358 Four Kinds of Influential Leadership 360

Transformational Leadership 360 Charismatic Leadership 361

Leader’s Self-Insight 12.1 362 Coalitional Leadership 363

In the Lead 364 Machiavellian-Style Leadership 366

Leader’s Bookshelf 367

Leader’s Self-Insight 12.2 368

In the Lead 368

Using Hard versus Soft Power 369 Specific Types of Power 370

In the Lead 372 Follower Responses to the Use of Power 373

Consider This! 373

Increasing Power Through Political Activity 374 Leader Frames of Reference 374

Leader’s Self-Insight 12.3 376 Political Tactics for Asserting Leader Influence 377

In the Lead 379

Don’t Take Power Personally 380

Leadership Essentials 381

Discussion Questions 382

Leadership at Work 383

Circle of Influence 383

Leadership Development: Cases for Analysis 384

The Suarez Effect 384

Waite Pharmaceuticals 386

References 387

PART 5: THE LEADER AS SOCIAL ARCHITECT 391 Chapter 13: Creating Vision and Strategic Direction 392 The Leader’s Job: Looking Forward 394

Stimulating Vision and Action 394

Consider This! 395 Strategic Leadership 396

In the Lead 397

Leadership Vision 398

Leader’s Bookshelf 399 What Vision Does 400

Leader’s Self-Insight 13.1 401

Leader’s Self-Insight 13.2 403 Common Themes of Vision 403 Leader Steps to Creating a Vision 405

In the Lead 406

Mission 406 What Mission Does 406

A Framework for Noble Purpose 408

In the Lead 410

The Leader as Strategist-in-Chief 411 How to Achieve the Vision 411

In the Lead 412 How to Execute 413

Leader’s Self-Insight 13.3 414

Leadership Essentials 417

Discussion Questions 418

Leadership at Work 418

x CONTENTS

Future Thinking 418

Leadership Development: Cases for Analysis 420

The New Museum 420

The Visionary Leader 421

References 423

Chapter 14: Shaping Culture and Values 426 Organizational Culture 428

What Is Culture? 428

Leader’s Bookshelf 429 Importance of Culture 431

In the Lead 431

Consider This! 432

Culture Strength, Responsiveness, and Performance 433

Responsive Cultures 433

Leader’s Self-Insight 14.1 434 The High-Performance Culture 435

In the Lead 437

Cultural Leadership 438 Ceremonies 438 Stories 439 Symbols 439

Specialized Language 440 Selection and Socialization 440 Daily Actions 441

The Competing Values Approach to Shaping Culture 441

Leader’s Self-Insight 14.2 443 Adaptability Culture 444

In the Lead 444 Achievement Culture 444 Involvement Culture 445 Consistency Culture 445

Ethical Values in Organizations 446

In the Lead 446

Values-Based Leadership 447 Personal Values 447

In the Lead 447 Spiritual Values 448

Leader’s Self-Insight 14.3 449

Leadership Essentials 451

Discussion Questions 452

Leadership at Work 452

Walk the Talk 452

Leadership Development: Cases for Analysis 454

Culture Clash 454

5 Star and Amtech 455

References 456

Chapter 15: Leading Change 460 Leadership Means Leading Change 462

Resistance Is Real 463 The Leader as Change Agent 463

Leader’s Self-Insight 15.1 464

In the Lead 464

A Framework for Change 465

Using Appreciative Inquiry 467 Applying Appreciative Inquiry on a Large Scale 467

Leader’s Self-Insight 15.2 468

In the Lead 470 Applying Appreciative Inquiry Every Day 470

Leader’s Bookshelf 471

Leading Creativity for Change 471 Instilling Creative Values 472 Leading Creative People 473

Leader’s Self-Insight 15.3 474

Implementing Change 479

Consider This! 479 Helping People Change 480

The Keys That Help People Change 481

In the Lead 481

Leadership Essentials 483

Discussion Questions 484

Leadership at Work 484

Organizational Change Role Play 484

Leadership Development: Cases for Analysis 486

“From This Point On …” 486

Riverside Pediatric Associates 487

References 488

Name Index 491

Index of Organizations 495

Subject Index 499

CONTENTS xi

A B O U T T H E A U T H O R

Richard L. Daft, Ph.D., is the Brownlee O. Currey, Jr., Professor of Management in the Owen Graduate School of Management at Vanderbilt University. Professor Daft specializes in the study of leadership and organization theory. Dr. Daft is a Fellow of the Academy of Management and has served on the editorial boards of Academy of Management Journal, Administrative Science Quarterly, and Journal of Management Education. He also served as the associate dean at the Owen School, was the associ- ate editor-in-chief of Organization Science, and served for three years as associate editor of Administrative Science Quarterly.

Professor Daft has authored or coauthored 13 books. His latest books include The Executive and the Elephant: A Leader’s Guide to Building Inner Excellence and Building Management Skills: An Action First Approach (with Dorothy Marcic). He is also the author of Organization Theory and Design, Management, and Fusion Leadership: Unlocking the Subtle Forces That Change People and Organizations (with Robert Lengel). He has also authored dozens of scholarly articles, papers, and chapters. His work has been published in Administrative Science Quarterly, Academy of Management Journal, Academy of Management Review, Strategic Management Journal, Journal of Management, Accounting Organizations and Society, Management Science, MIS Quarterly, California Management Review, Leadership Excellence, Leader to Leader, and Organizational Behavior Teaching Review.

Dr. Daft also is an active teacher and consultant. He has taught leadership, leading change, management, organizational theory, and organizational behavior. He has also produced for-profit theatrical productions and helped manage a start- up enterprise. He has been involved in management development and consulting for many companies and government organizations, including the National Academy of Science, Oak Ridge National Laboratory, American Banking Association, AutoZone, Aegis Technology, Bell Canada, Nortel, Bridgestone, TVA, Pratt & Whitney, Allstate Insurance, State Farm Insurance, the United States Air Force, the U.S. Army, Central Parking System, USAA, Bristol-Myers Squibb, Eli Lilly, and the Vanderbilt University Medical Center.

xii Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

P R E F A C E

Many leaders have recently had their assumptions challenged about how organiza- tions succeed. Leaders are struggling to make sense of the shifting environment and learn how to lead effectively and successfully in the midst of turmoil. The crisis in the housing, mortgage, and finance industries and resulting recession; the failures of sev- eral large, long-standing organizations and the government bailout of others; volatile oil prices; ethical scandals; political turmoil; and other events have dramatically shifted the organizational and economic landscape. This edition of The Leadership Experience addresses themes and issues that are directly relevant to the current turbulent environment. My vision for the sixth edition is to give students an exciting, applied, and comprehensive view of what leadership is like in today’s world. The Leadership Experience integrates recent ideas and applications with established scholarly research in a way that makes the topic of leadership come alive. Organizations are undergoing major changes, and this textbook addresses the qualities and skills leaders need in this rapidly evolving world.

Recent chaotic events, combined with factors such as a growing need for creativity and innovation in organizations, the rise of social media, the growth of e-business and mobile commerce, the use of virtual teams and telecommuting, glob- alization, the emerging problem of cybercrime, and other ongoing transformations place new demands on leaders that go far beyond the topics traditionally taught in courses on management or organizational behavior. My experiences teaching leadership to students and managers, and working with leaders to change their organizations, have affirmed for me the value of traditional leadership concepts while highlighting the importance of including new ideas and applications.

The Leadership Experience thoroughly covers the history of leadership studies and the traditional theories but goes beyond that to incorporate valuable ideas such as lead- ership vision, shaping culture and values, leadership courage, and the importance of moral leadership. The book expands the treatment of leadership to capture the excite- ment of the subject in a way that motivates students and challenges them to develop their leadership potential.

NEW TO THE SIXTH EDITION A primary focus for revising The Leadership Experience, sixth edition, has been to relate leadership concepts and theories to events in today’s turbulent environment. Each chapter has been thoroughly revised and updated to bring in current issues and events that leaders are facing.

xiii Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Topics that have been added or expanded in the sixth edition include:

• the importance of self-awareness for leadership

• developing a global mindset • elements of personal mastery • the influence of emotions on

performance

• emotional contagion • leadership courage as a skill • managing up and down the

hierarchy

• follower sources of power • leadership coaching • positive and negative motives that

influence people to act

• building a thriving workforce • the making progress principle • psychological and job design ele-

ments of empowerment

• the leader as a sensegiver • candid communication • using storytelling to influence • redundant communication

• using social media for leadership • essential team competencies • team task and socioemotional

roles

• balancing conflict and cooperation

• employee affinity groups • minority sponsorship • diversity of thought • Machiavellian-style leadership • cocreating a vision • steps for implementing strategy • building a high-performance cul-

ture through attention to both values and results

• facilitating creativity by enabling immersion and allowing pauses

• the transition required for people to change behavior

• helping people change with a positive emotional attractor.

The book also includes several new cases for analysis that are related to new topics and current issues.

The Leadership Experience continues to offer students great opportunities for self-assessment and leadership development. An important aspect of learning to be a leader involves looking inward for greater self-understanding, and the sixth edi- tion provides numerous opportunities for this reflection. Each chapter includes mul- tiple questionnaires or exercises that enable students to learn about their own leadership beliefs, values, competencies, and skills. These exercises, several of which are new to this edition, help students gauge their current standing and connect the chapter concepts and examples to ideas for expanding their own leadership abilities. A few of the self-assessment topics involve engagement, networking, ethical maturity, personality traits, leading diverse people, developing a personal vision, spiritual lead- ership, candor, leadership courage, optimism, and leading with love versus leading with fear. Self-assessments related to basic leadership abilities such as listening skills, emotional intelligence, motivating others, and using power and influence are also included. Additional self-assessments are available within CengageNOW.

ORGANIZATION The organization of the book is based on first understanding basic ways in which leaders differ from managers, and the ways leaders set direction, seek alignment between organizations and followers, build relationships, and create change. Thus, the organization of this book is in five parts:

1. Introduction to Leadership

2. Research Perspectives on Leadership

3. The Personal Side of Leadership

xiv PREFACE

4. The Leader as a Relationship Builder

5. The Leader as Social Architect

The book integrates materials from both micro and macro approaches to lead- ership, from both academia and the real world, and from traditional ideas and recent thinking.

DISTINGUISHING FEATURES This book has a number of special features that are designed to make the material accessible and valuable to students.

In the Lead The Leadership Experience is loaded with new examples of leaders in both traditional and contemporary organizations. Each chapter opens with a real- life example that relates to the chapter content, and several additional examples are highlighted within each chapter. These spotlight examples are drawn from a wide variety of organizations including education, the military, government agencies, businesses, and nonprofit organizations.

Consider This! Each chapter contains a Consider This! box that is personal, compel- ling, and inspiring. This box may be a saying from a famous leader, or wisdom from the ages. These Consider This! boxes provide novel and interesting material to expand the reader’s thinking about the leadership experience. Several of these are new to this edition.

Leader’s Bookshelf In this edition, 13 of the 15 chapters have new Leader’s Bookshelf reviews. A unique feature of The Leadership Experience is that each chapter includes a review of a recent book relevant to the chapter’s content. The Leader’s Bookshelf con- nects students to issues and topics being read and discussed in the worlds of academia, business, military, education, and nonprofit organizations.

New Leader Action Memo This feature helps students apply the chapter concepts in their own lives and leadership activities, as well as directs students to self-assess- ments related to various chapter topics.

Leader’s Self-Insight These boxes provide self-assessments for learners and an opportunity to experience leadership issues in a personal way. These exercises take the form of questionnaires, scenarios, and activities.

Follow the Leader This brand-new feature referenced within the text and housed within CengageNOW provides an opportunity for students to review a curated list of Twitter feeds from today’s business leaders. Students can then add those leaders’ feeds to their own personal Twitter accounts as desired, providing a constant, current window into the leadership world.

Student Development Each chapter ends with discussion questions and then two activities for student development. The first, Leadership at Work, is a practical, skill- building activity that engages the student in applying chapter concepts to real-life lead- ership. These exercises are designed so students can complete them on their own out- side of class or in class as part of a group activity. Instructor tips are given for maximizing in-class learning with the Leadership at Work exercises. Leadership

PREFACE xv

Development—Cases for Analysis, the second end-of-chapter activity, provides two short, problem-oriented cases for analysis. Fourteen of the 15 chapters have a new case in this edition, and additional cases are available online. These cases test the student’s ability to apply concepts when dealing with real-life leadership issues. The cases challenge the student’s cognitive understanding of leadership ideas while the Leadership at Work exercises and the feedback questionnaires assess the student’s progress as a leader.

CengageNOW The Leadership Experience, sixth edition, now includes a robust set of online resources within the CengageNOW platform designed to facilitate student progress through the stages of learning, allowing them to ENGAGE with the course content, CONNECT to the concepts through knowledge and comprehension activ- ities, PERFORM as leaders through the application of those concepts, and LEAD through participation in real-world experiential exercises.

The CengageNOW diagram on page xvii provides a quick glance at the multitude of brand-new digital resources available for each chapter. Among the features are the in-text “Leader’s Self-Insight” exercises provided in an interactive format and enhanced with even more online-exclusive assessments, a selection of brand-new homework activities written within the Engage/Connect/Perform/Lead levels of learning, the “Leadership at Work” exercises now provided in an online format for convenient completion, and a brand-new selection of curated Twitter feeds that allow students to “Follow the Leaders” who write regularly about their experiences in today’s evolv- ing environment. All this and much more is available within CengageNOW. Look for the “See It Online” icons within the text that identify where textual information is enhanced with interactive CengageNOW content.

ANCILLARIES This edition offers a wide range of instructor ancillaries to fully enable instructors to bring the leadership experience into the classroom. These ancillaries include:

Instructor’s Manual A comprehensive Instructor’s Manual is available to assist in lecture preparation. Included in the Instructor’s Manual are the chapter outlines, suggested answers to end-of-chapter materials, suggestions for further study, and a quick-glance overview for each chapter of the available CengageNOW resources to assist instructors in their planning.

Test Bank Cengage Learning Testing Powered by Cognero is a flexible, online system that allows you to author, edit, and manage test bank content from multiple Cengage Learning solutions; create multiple test versions in an instant; and deliver tests from your LMS, your classroom, or wherever you want. The test bank for The Leadership Experience, sixth edition, includes approximately 60 questions per chapter to assist in writing examinations. Types of questions include true/false, multiple choice, completion, short-answer, and essay, with all questions tagged to relevant national competencies. To ensure consistency across our entire package, the content of the test bank has been fully reviewed and updated by the same authors who have crafted our new digital resources.

xvi PREFACE

PREFACE xvii

PowerPoint Lecture Presentations An asset to any instructor, the lectures provide outlines for every chapter, illustra- tions from the text, and additional examples providing instructors with a number of learning opportunities for students.

Videos Videos compiled specifically to accompany The Leadership Experience, sixth edition, allow students to engage with the textual material by applying theories and concepts to real-world situations.

ACKNOWLEDGMENTS Textbook writing is a team enterprise. This book has integrated ideas and support from many people whom I want to acknowledge. I want to extend special thanks to my editorial associate, Pat Lane. I could not have undertaken this revision without Pat’s help. She skillfully drafted materials for the chapters, found original sources, and did an outstanding job with last-minute changes, the copyedited manuscript, art, and galley proofs. Pat’s talent and personal enthusiasm for this text added greatly to its excellence. I also want to thank DeeGee Lester, who used her creative writing talent to draft numerous outstanding cases that appear in the text or online for several chapters.

Here at Vanderbilt I want to thank my assistant, Barbara Haselton, for the tre- mendous volume and quality of work she accomplished on my behalf that gave me time to write. Jim Bradford, the dean at Owen, and Ray Friedman, associate dean, have maintained a positive scholarly atmosphere and supported me with the time and resources to complete the revision of this book. I also appreciate the intellectual stimulation and support from friends and colleagues at the Owen School—Bruce Barry, Rich Oliver, David Owens, Ty Park, Ranga Ramanujam, Bart Victor, and Tim Vogus.

I want to acknowledge the reviewers who provided feedback. Their ideas helped me improve the book in many areas:

Thomas H. Arcy University of Houston—Central Campus

Janey Ayres Purdue University

Kristin Backhaus SUNY New Paltz

Bill Bommer Georgia State University

William Russell Brown Navarro College

Jared Caughron University of Oklahoma

Meredith Rentz Cook North Central Texas College

Glenn K. Cunningham Duquesne University

Jeffrey Fisher Embry Riddle Aeronautical University

Ron Franzen Saint Luke’s Hospital

Adrian Guardia Texas A&M University—San Antonio

Delia J. Haak John Brown University

Nell Hartley Robert Morris College

Ann Horn-Jeddy Medaille College

xviii PREFACE

Ellen Jordan Mount Olive College

Alyson Livingston North Central Texas College

Gregory Manora Auburn University-Montgomery

Joseph Martelli The University of Findlay

Richard T. Martin Washburn University

Jalane Meloun Barry University

Mark Nagel Normandale Community College

Ranjna Patel Bethune Cookman College

Chad Peterson Baylor University

Gordon Riggles University of Colorado

Miriam Rothman University of San Diego

Bill Service Samford University

Dan Sherman University of Alabama at Huntsville

Bret Simmons North Dakota State University

Shane Spiller University of Montevallo

Shand H. Stringham Duquesne University

Ahmad Tootonchi Frostburg State University

Mary L. Tucker Ohio University

Joseph W. Weiss Bentley University

Donald D. White University of Arkansas

Xavier Whitaker Baylor University

Jean Wilson The College of William and Mary

George A. Wynn University of Tampa

The developers at Cengage Learning also deserve special mention. Senior Product Manager Scott Person supported the concept for this book and obtained the resources necessary for its completion. Associate Content Developer Josh Wells provided terrific support for the book’s writing, reviews, and production. Senior Media Developer Sally Nieman worked steadfastly in ensuring the successful creation of the digital resources. Product Assistant Tammy Grega was instrumental in supporting the development processes for the learning package.

I also thank Bob Lengel at the University of Texas at San Antonio. Bob’s enthusi- asm for leadership many years ago stimulated me to begin reading, teaching, and train- ing in the area of leadership development. His enthusiasm also led to our collaboration on the book Fusion Leadership: Unlocking the Subtle Forces That Change People and Organizations. I thank Bob for keeping the leadership dream alive, which in time enabled me to pursue my dream of writing this leadership textbook.

Finally, I want to acknowledge my loving daughters Danielle, Amy, Roxanne, Solange, and Elizabeth. Although everyone is now pursuing their own lives and careers, I appreciate the good feelings and connections with my children and grand- children. On occasion, we have been able to travel, ski, watch a play, or just be together—all of which reconnect me to the things that really count.

Richard L. Daft Nashville, Tennessee

PREFACE xix

Part 1: Introduction to Leadership

Chapter 1: What Does It Mean to Be a Leader?

W or ld Im ag er y/ G et ty Im ag es

Chapter 1: What Does It Mean to Be a Leader?

W or ld Im ag er y/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After studying this chapter, you should be able to:

• Understand the full meaning of leadership and see the leadership potential in yourself and others. • Recognize and facilitate the six fundamental transformations in today’s organizations and leaders. • Identify the primary reasons for leadership derailment and the new paradigm skills that can help

you avoid it.

• Recognize the traditional functions of management and the fundamental differences between leadership and management.

• Appreciate the crucial importance of providing direction, alignment, relationships, personal qualities, and outcomes.

• Explain how leadership has evolved and how historical approaches apply to the practice of leadership today.

CHAPTER OUTLINE 4 The Need for Leadership

7 The New Reality for Leaders

13 How Leadership Differs from Management

17 Evolving Theories of Leadership

20 Leadership Can Be Learned

23 Mastering the Art and Science of Leadership

25 Organization of This Book

In the Lead

9 Vineet Nayar, HCL Technologies

22 Google

Leader’s Self-Insight

12 Your Learning Style: Using Multiple Intelligences

16 Your Leadership Potential

22 Are You on a Fast Track to Nowhere?

Leader’s Bookshelf

11 Great by Choice: Uncertainty, Chaos, and Luck—Why Some Thrive Despite Them All

Leadership at Work

27 Leadership Right–Wrong

Leadership Development: Cases for Analysis

28 Sales Engineering Division

29 The Marshall Plan

A s a young politician, Abraham Lincoln once provoked an opponent to tears by using his expert communication skills to mimic and ridicule his rival. Soon afterward, the man who would later become the 16th president of the United

States felt disappointed and ashamed of his own behavior and sought out his opponent to offer an apology. Lincoln took this as a valuable lesson about channeling his emotions, practicing empathy, and using his abilities to promote good. From then on, Lincoln applied his superb leadership and communication skills to serve the higher interests of the American people rather than his own goals and ego.

Interest in Abraham Lincoln’s leadership swelled with the release of Steven Spielberg’s 2012 historical film Lincoln, which was a huge critical and commercial success, grossing more than $250 million at the box office and garnering 12 Academy Award nominations. “Lincoln’s presidency is a big, well-lit classroom for business leaders seeking to build successful, enduring organizations,” said Howard Schultz, CEO of Starbucks. In this era of disconnected and morally bankrupt leaders, it is no wonder the skills, strengths, and character of Lincoln have struck a chord. His ability to control his emotions and stay committed to a vision even under intense hardship, his commitment to go into the field and establish connections with soldiers and the general public, and his willingness to listen to different points of view

3 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

and to share credit for successes and take blame for failures all tap into a deep longing within people for genuine leadership.1

The public trust in leaders may be at an all-time low. Referring to the dire economic situation that followed the ethical and financial problems in the mortgage and finance industries, David Rothkopf wrote in the Washington Post, “This is not just a global economic crisis. It is a global leadership crisis.”2

THE NEED FOR LEADERSHIP Many of us think of leadership in a way similar to what U.S. Supreme Court Justice Potter Stewart said about obscenity in reviewing a 1964 pornography case: we may not be able to define it but “we know it when we see it.”3 People can clearly see leadership in Abraham Lincoln, but many are having a hard time seeing it in current political, business, military, and even religious leaders. General David Petraeus, one of the most decorated military leaders of his generation, stepped down as director of the Central Intelligence Agency after the FBI inadvertently discovered he had an extramarital affair with his biographer and began investigating for potential leaks of classified information. The British Broadcasting Corporation (BBC) was tarnished by allegations that managers covered up years of sexual abuse by a well-known reporter.4 Senator Chuck Grassley recently probed the financial records of six well-known televangelists, including Creflo Dollar and Kenneth Copeland, after reports that tax-exempt donations were financing lavish lifestyles for the religious leaders, including mansions, Rolls Royce cars, and private jets.5 Nearly every month brings a new report of a business leader somewhere lying to, misleading, or cheating employees, customers, or the government. No wonder survey after survey shows that confidence in leaders is sinking and suspicion and distrust are rising.6

Yet there are good leaders working in every organization, large and small. In fact, quality leadership is all around us every day, in all facets of our lives—our families, schools, communities, social clubs, and volunteer organizations, as well as in the world of business, sports, religion, government, and the military. Without good leadership, our institutions and society would fall apart.

Before we can examine what makes an effective leader, we need to know what leadership means. Scholars and other writers have offered hundreds of definitions of the term leadership, prompting James McGregor Burns to conclude that leader- ship “is one of the most observed and least understood phenomena on earth.”7

Defining leadership has been a complex and elusive problem largely because the nature of leadership itself is complex. Some have even suggested that leadership is nothing more than a romantic myth, perhaps based on the false hope that someone will come along and solve our problems by sheer force of will.8

There is some evidence that people do pin their hopes on leaders in ways that are not always realistic. Think about how some struggling companies recruit well- known, charismatic CEOs and invest tremendous hopes in them, only to find that their problems actually get worse.9 For example, Yahoo hired former Autodesk CEO Carol Bartz in 2009 with high hopes that the star leader could turn the strug- gling company around, only to ask her to leave a couple of years later as Yahoo’s fortunes continued to slide. In mid-2012, Yahoo hired former Google executive Marissa Mayer as the fifth CEO in five years.

Particularly when times are tough, people often look to a grand, charismatic type of leader to alleviate fear and uncertainty. Think of how Barack Obama sailed

4 PART 1 INTRODUCTION TO LEADERSHIP

to the U.S. presidency in 2008 based largely on his charisma and the ability to make people feel hopeful in a time of uncertainty. In recent years, the romantic or heroic view of leadership has been challenged.10 Much progress has been made in under- standing the essential nature of leadership as a real and powerful influence in orga- nizations and societies.

Leadership Defined Leadership studies are an evolving discipline, and the concept of leadership will continue to develop. For the purpose of this book, we will focus on a single defini- tion that delineates the essential elements of the leadership process: Leadership is an influence relationship among leaders and followers who intend real changes and outcomes that reflect their shared purposes.11

Exhibit 1.1 summarizes the key elements in this definition. Leadership involves influence; it occurs among people; those people intentionally desire significant changes; and the changes reflect purposes shared by leaders and followers. Influ- ence means that the relationship among people is not passive; however, also inher- ent in this definition is the concept that influence is multidirectional and noncoercive. The basic cultural values in North America make it easiest to think of leadership as something a leader does to a follower.12 However, leadership is reciprocal. In most organizations, superiors influence subordinates, but subordinates also influence superiors. The people involved in the relationship want substantive changes—leadership involves creating change, not maintaining the status quo. In addi- tion, the changes sought are not dictated by leaders but reflect purposes that leaders and followers share. Moreover, change is toward an outcome that both the leader and the followers want, a desired future or shared purpose that motivates them toward this more preferable outcome. An important aspect of leadership is influencing others to come together around a common vision. Thus, leadership involves the influence of people to bring about change toward a desirable future.

Also, leadership is a people activity and is distinct from administrative paper- work or planning activities. Leadership occurs among people; it is not something

EXHIBIT 1.1 What Leadership Involves

Leadership an influence relationship among leaders and followers who intend real changes and outcomes that reflect their shared purposes

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 5

done to people. Since leadership involves people, there must be followers. An individ- ual performer who achieves excellence as a scientist, musician, athlete, or woodcarver may be a leader in her field of expertise but is not a leader as defined in this book unless followers are involved. Followers are an important part of the leadership process, and all leaders are sometimes followers as well. Good leaders know how to follow, and they set an example for others. The issue of intention or will means that people—leader and followers—are actively involved in the pursuit of change. Each person takes personal responsibility to achieve the desired future.

One stereotype is that leaders are somehow different, that they are above others; however, in reality, the qualities needed for effective leadership are the same as those needed to be an effective follower.13 Effective followers think for themselves and carry out assignments with energy and enthusiasm. They are committed to something outside their own self-interest, and they have the courage to stand up for what they believe. Good followers are not “yes people” who blindly follow a leader. Effective leaders and effective followers may sometimes be the same people, playing different roles at different times. At its best, leadership is shared among leaders and followers, with everyone fully engaged and accepting higher levels of responsibility.

Everyday Leadership Using this definition of leadership makes clear that leadership can come from anyone. When we stop equating leadership with greatness and public visibility, it becomes easier to see our own opportunities for leadership and recognize the leadership of people we interact with every day. Leaders come in all shapes and sizes, and many true leaders are working behind the scenes. Leadership that has big outcomes often starts small.

• Clinical psychologist Barbara Van Dahlen was working primarily with children in the Washington, D.C., area when she became concerned about the effects of the wars in Iraq and Afghanistan on the mental health of U.S. soldiers, veter- ans, and their families. Van Dahlen founded Give an Hour in 2005 to provide free services that give help and hope to returning service members. The organiza- tion now has a national network of more than 6,100 mental health professionals who volunteer their time. Give an Hour also works with other organizations, such as Bare the Burden, a nonprofit organization that creates an online commu- nity for veterans to heal by connecting with others.14

• During his five years working as a car salesman, Robert Chambers was disgusted by how some dealers and finance institutions preyed on low-income customers. After he retired from a varied career, the 62-year-old electrical engi- neer decided to do something about it. He founded More Than Wheels, which helps low-income people buy new, base-model cars at low prices and on good loan terms. With branches in New Hampshire, Vermont, and Maine, More Than Wheels has negotiated price and extended warranty deals with a dozen or so auto dealers and worked with banks to provide low interest rates. More Than Wheels guarantees the loan and then works with clients to help them manage their finances, improve their credit score, and improve their future.15

• Wendy Kopp was a senior at Princeton University when she first came up with the idea of a sort of “Peace Corps for teachers,” a national organization that would recruit recent college graduates to commit to teach for two years at some of America’s toughest public schools. One of her Princeton professors admits he called her “deranged” when she proposed the idea to him. Yet Teach for

6 PART 1 INTRODUCTION TO LEADERSHIP

America, the organization Kopp started, became one of the most respected educational initiatives in the United States. As the organization has grown larger, it has come under attack, but most observers agree it has changed education for the better and it continues to harness the idealism of young college graduates as a force for good.16

There are opportunities for leadership all around us that involve influence and change toward a desired goal or outcome. The leaders of tomorrow’s organizations will come from anywhere and everywhere, just as they always have. Do you have the capacity and commitment required for taking a leadership role in your school, community, or workplace? You can start now, wherever you are, to practice lead- ership in your own life. Leadership is an everyday way of acting and thinking that has little to do with a title or formal position in an organization. As we will discuss in the following section, business leaders need to understand this tenet more than ever in the world of the twenty-first century.

THE NEW REALITY FOR LEADERS Social media. Globalization. Mobile commerce. Geopolitical wars. Renewable technol- ogies and smart machines. Outsourcing. Climate change and resource scarcity. Telecommuting and virtual teams. Cybercrime. Redistribution of economic power. Massive changes in the world mean today’s leaders are facing challenges they couldn’t even imagine just a few years ago.17 In a survey by the Center for Creative Leadership, 84 percent of leaders surveyed say the definition of effective leadership changed significantly within the first few years of the twenty-first century.18 And that was even before social and mobile technologies began reshaping everyday life and work. Social connectedness and mobility are becoming central aspects of every leader’s job.

Some historians and other scholars believe our world is undergoing a transfor- mation more profound and far-reaching than any experienced since the dawn of the modern age and the Industrial Revolution more than 500 years ago. Today’s lea- ders operate in a world where little is certain, the pace is relentless, and everything is more complex. This transformation requires a transition from a traditional to a new leadership paradigm, as outlined in Exhibit 1.2.19 A paradigm is a shared mindset that represents a fundamental way of thinking about, perceiving, and understanding the world.

Although many leaders are still operating from an old-paradigm mindset, as out- lined in the first column of Exhibit 1.2, they are increasingly ineffective. Successful leaders will respond to the new reality outlined in the second column of the exhibit.

From Stabilizer to Change Manager In the past, many leaders assumed that if they could just keep things running on a steady, even keel, the organization would be successful. Yet today’s world is in constant motion, and nothing seems certain anymore. If leaders still had an illusion of stability at the dawn of the twenty-first century, it is surely shattered by now. Consider the following recent events:

• A powerful earthquake in Japan in 2011 triggered massive tsunami waves that damaged the nuclear reactors at the Fukushima Daiichi power plant and led to the shutdown of numerous companies, creating supply chain disruptions for manufacturers around the world. In the wake of the disaster, managers at

NEW LEADER ACTION MEMO As a leader, you can recognize opportunities for leadership and act to influence others and bring about changes for a better future.

Go to CengageNOW to complete the questionnaire “Intolerance of Ambiguity” and

see how comfortable you would be dealing with the uncertainty facing today’s leaders.

Paradigm a shared mindset that represents a fundamental way of thinking about, per- ceiving, and understanding the world

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 7

Tokyo Electric Power Company (Tepco) were criticized for failing to act quickly enough to cool the reactors at Fukushima. Trying to protect their investment, they hesitated to use seawater, which they knew could damage the reactors, leading to the second-largest nuclear disaster in history.20

• The Arab Spring, a revolutionary wave of protests in the Arab world that began in late 2010, has created a tumultuous environment for businesses operating in the region as well as heightened uncertainty and instability for companies around the world.21 Instability remains elevated throughout the Arab world, causing problems for both local and foreign organizations.

• In the European Union (EU), Spain, Ireland, and particularly Greece have all had trouble paying their debts, leading to a possible breakup of the euro system (the single currency adopted by EU countries). Leaders of multinational firms doing business in EU countries had to brace for the worst and take steps to protect themselves, as well as consider what they would do in the event that a return to national currencies required a rethinking of everything from how to expand operations to how to pick suppliers or pay employees.22

• Meanwhile, the United States has faced its own debt crisis, and the fallout from the meltdown in the mortgage and housing industries has continued. Although the economy has improved, it remains a largely “jobless recovery,” with people struggling to find work and pay their bills. Companies are struggling too, and passage of the Patient Protection and Affordable Care Act (passed in 2010 and upheld by the Supreme Court as constitutional in 2012), which requires that companies provide health insurance for employees or pay penalties, has increased the complexity.23

EXHIBIT 1.2 The New Reality for Leaders

8 PART 1 INTRODUCTION TO LEADERSHIP

Most leaders, whether in business, politics, the military, education, social services, the arts, or the world of sports, recognize that trying to maintain stability in a world of such unexpected and far-reaching change is a losing battle. “You have to be able to react very quickly,” said Ellen Kullman, CEO of DuPont, referring to the impact of events such as the Japanese tsunami and the EU financial crisis. “And the world is so connected that the feedback loops are more intense.”24

Today’s best leaders accept the inevitability of change and crisis and tap into them as potential sources of energy and self-renewal. Adaptability is the watchword of the day. The Leader’s Bookshelf on page 11 argues that organizational success results from leaders who can remain calm, focused, and disciplined in the face of uncertainty and inevitable change.

From Controller to Facilitator Leaders in powerful positions once believed strict control was needed for the orga- nization to function efficiently and effectively. Rigid organizational hierarchies, structured jobs and work processes, and detailed, inviolate procedures let everyone know that those at the top had power and those at the bottom had none.

Today, the old assumptions about the distribution of power are no longer valid. An emphasis on control and rigidity serves to squelch motivation, innovation, and morale rather than produce desired results. Effective leaders share power rather than hoard it and find ways to increase an organization’s brainpower by getting everyone in the organization involved and committed. Rather than being a controller, the leader is a facilitator who helps people do and be their best by removing obstacles to performance, getting people what they need, providing learning opportunities, and offering support and feedback.

One reason for this is that the financial basis of today’s economy is becoming information rather than the tangible assets of land, buildings, and machines. This means human capital is becoming more important than financial capital, which increases the power of employees. “Ideas are now more important than materials,” as Israeli president Shimon Peres puts it.25 When all the organization needed was workers to run machines eight hours a day, traditional command-and-control sys- tems generally worked quite well, but success today depends on the intellectual capacity of all employees. One of the leader’s most challenging jobs is to enable people to embrace and use their power effectively.26 When he took over as CEO of India’s HCL Technologies in 2005, Vineet Nayar (currently vice chairman and joint managing director) took a huge risk that proved to be a highly effective route to true employee empowerment.

IN THE LEAD Vineet Nayar, HCL Technologies HCL Technologies is a leading global IT services and software development company and India’s fourth largest IT services exporter. When Vineet Nayar became CEO in 2005, HCL was losing ground—and some of its best employees—to competitors. Nayar recalls that HCL “was in a tough spot and we had to do something fast or we were in danger of being out of the race altogether.”

What Nayar did was revolutionary: He organized the company on the principle of “employees first, customers second” (EFCS). He had to start by building trust. He decided to

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 9

share financial information with everyone in the company. Then, he took a bold step by creating an open online forum where employees could post questions and leaders would answer. This could expose weaknesses and problems that anyone—including outside customers and competitors—could see. Indeed it did. “It was clogged with complaints,” Nayar says. “It hurt.” But interesting things began to happen. People were overjoyed that leaders were willing to acknowledge the problems. Some employees took this a step further and felt empowered to offer solutions. The site ultimately was the beginning of a transfer of the power and responsibility for solving problems from top executives to employees themselves. In the new HCL, the job of leaders became to serve the employees.

Guided by the EFCS philosophy, HCL’s revenues have grown by over 3.6 times and net income has increased by 91 percent since 2005. During 2008–2009, at the height of the global recession, HCL became the fastest-growing IT services company in the world. Employees helped make that happen, too. When the company needed to cut expenses by $100 million due to the recession, managers let employees come up with ideas for cutting costs without issuing massive layoffs.27

From Competitor to Collaborator Social media has “put connectivity on steroids,” blurring and sometimes obliterat- ing boundaries within and between organizations.28 In a hyperconnected, net- worked age, collaboration becomes more important than competition. Successful leaders harness and make the most of ideas, talent, and resources from across boundaries of all kinds. Although some companies still encourage internal competi- tion and aggressiveness, most successful leaders stress teamwork, compromise, and cooperation. Self-directed teams and other forms of horizontal collaboration spread knowledge and information throughout the organization.

Effective leaders also work collaboratively with suppliers, customers, govern- ments, universities, and other organizations. There is a growing trend within com- panies to think of themselves as teams that create value jointly rather than as autonomous entities in competition with all others.

Collaboration presents greater leadership challenges than did the old concept of competition. Leaders first have to develop their own collaborative mindset and then create an environment of teamwork and community that fosters collaboration and mutual support. They learn to keep the lines of communication open and use influ- ence rather than wielding their authority to quell harmful politicking, get buy-in on important matters, and move things forward.29

From Diversity Avoider to Diversity Promoter Many of today’s organizations were built on assumptions of uniformity, separation, and specialization. People who think alike, act alike, and have similar job skills are grouped into a department, such as accounting or manufacturing, separate from other departments. Homogenous groups find it easy to get along, communicate, and understand one another. The uniform thinking that arises, however, can be a disaster in a world becoming more multinational and diverse.

Bringing diversity into the organization is the way to attract the best human talent and develop an organizational mindset broad enough to thrive in a multina- tional world. Carlos Ghosn, CEO of Nissan, says one reason his company has been able to cope with change and crises better than some of its competitors is its highly

NEW LEADER ACTION MEMO Go to Leader’s Self-Insight 1.1 to learn about your own “intelligence” for dealing with collaboration and with the other new realities facing leaders.

10 PART 1 INTRODUCTION TO LEADERSHIP

diverse culture and workforce.30 Two business school graduates in their twenties discovered the importance of diversity when they started a specialized advertising firm. They worked hard, and as the firm grew, they hired more people just like themselves—bright, young, intense college graduates who were committed and hard working. The firm grew to about 20 employees over two and a half years, but the expected profits never materialized. The two entrepreneurs could never get a handle on what was wrong, and the firm slid into bankruptcy. Convinced the idea was still valid, they started over, but with a new philosophy. They sought employ- ees with different ages, values, ethnic backgrounds, and work experience. People had different styles, yet the organization seemed to work better. People played dif- ferent roles, and the diverse experiences of the group enabled the firm to respond to unique situations and handle a variety of organizational and personal needs. The advertising firm is growing again, and this time it is also making a profit.

From Hero to Humble Another shift is the move from celebrating the “leader-as-hero” to recognizing the hard-working behind-the-scenes leader who quietly builds a strong enduring com- pany by supporting and developing others rather than touting his or her own abili- ties and successes.31 Recall from this chapter’s opening example how Abraham Lincoln made an intentional choice early in his political career to use his abilities to serve the interests of the American people rather than to feed his own ego. This chapter’s Consider This box presents 10 commandments based on 1950s western

LEADER’S BOOKSHELF Great by Choice: Uncertainty, Chaos, and Luck— Why Some Thrive Despite Them All

by Jim Collins and Morten T. Hansen

Every company is subject to periods of instability, uncertainty, and crisis. Bad luck can strike any leader and any organization. How do some companies manage to thrive despite circum- stances that cause others to fall hard and fall fast?

Jim Collins, the author of Good to Great, has been looking at companies that perform better than their peers for a long time. For Great by Choice, he teams with management professor Morten Hansen to describe the lead- ership choices that contribute to success.

LEADER CHOICES MAKE THE DIFFERENCE Great by Choice first describes organiza- tions, called 10Xers, that have outper- formed their industry averages by at least 10 times over a period of at least 15 years and compares them to similar, less successful companies. The 10Xers include Southwest Airlines, Amgen, Intel, and

Progressive Insurance. Leaders of 10X companies all share three characteristics:

• Fanatic Discipline. The authors use the metaphor of the 20 Mile March, a paced, consistent journey toward goals that requires both the ambi- tion to achieve and the self-control to hold back. 10X leaders prefer con- sistent gains over shoot-for-the moon risks. Andrew Grove at Intel, for example, abandoned the busi- ness of making memory chips only after thoroughly learning about the changing technology environment and business environment.

• Empirical Creativity. An entire chap- ter is devoted to the “fire bullets, then cannonballs” approach. Leaders in 10X companies tend to fire bullets to see what will work and only then bring out the big guns. “After the cannonball hits,” they write, “you keep 20 Mile Marching to make the most of your big success.”

• Productive Paranoia. Herb Kelle- her, founder and former CEO of Southwest Airlines, was always pre- paring for the next recession, even when none was in sight. 10X leaders “remain productively paranoid in good times, recognizing that it’s what they do before the storm that matters most.” They are always building buffers and putting in place shock absorbers to deal with unexpected events.

THRIVING IN CHAOS Leaders of 10X companies “care as much about values as victory, as much about purpose as profit.” This enables them to build companies that endure. They create companies that don’t thrive on chaos and uncertainty but can survive and even thrive in it.

Source: Great by Choice, by Jim Collins and Morten T. Hansen, is published by HarperBusiness.

hu tte rs to ck .c om

11 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

film star Gene Autry’s Cowboy Code that can be regarded as applicable to new- paradigm leaders even today.

One reason for the shift from hero to humble is that it is less and less realistic for an individual leader to meet all the challenges a team or organization faces in a complex and rapidly changing world. Another is that ambitious, highly self- confident, charismatic leaders have been at the forefront of some of the ethical scan- dals and business failures of recent years. The hero leader may make more risky and daring decisions, often without considering the greater good, whereas a humble

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 1.1

Your Learning Style: Using Multiple Intelligences

Instructions: Multiple-intelligence theory suggests that there are several different ways of learning about things in a topsy- turvy world; hence there are multiple “intelligences,” of which five are interpersonal (learn via interactions with others), intra- personal (own inner states), logical–mathematical (rationality and logic), verbal-linguistic (words and language), and musical (sounds, tonal patterns, and rhythms). Most people prefer one or two of the intelligences as a way of learning, yet each person has the potential to develop skills in each of the intelligences.

The items below will help you identify the forms of intelligence that you tend to use or enjoy most, as well as the forms that you use less. Please check each item below as Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I like to work with and solve complex problems.

2. I recently wrote something that I am especially proud of.

3. I have three or more friends. 4. I like to learn about myself

through personality tests. 5. I frequently listen to music on the

radio or iPod-type player. 6. Math and science were among

my favorite subjects. 7. Language and social studies were

among my favorite subjects. 8. I am frequently involved in social

activities. 9. I have or would like to attend

personal growth seminars. 10. I notice if a melody is out of tune

or off key. 11. I am good at problem solving

that requires logical thinking. 12. My conversations frequently include

things I’ve read or heard about.

13. When among strangers, I easily find someone to talk to.

14. I spend time alone meditating, reflecting, or thinking.

15. After hearing a tune once or twice, I am able to sing it back with some accuracy.

Scoring and Interpretation Count the number of items checked Mostly True that repre- sent each of the five intelligences as indicated below.

Questions 1, 6, 11: Logical–mathematical intelligence. # Mostly True . Questions 2, 7, 12: Verbal–linguistic intelligence. # Mostly True . Questions 3, 8, 13: Interpersonal intelligence. # Mostly True . Questions 4, 9, 14: Intrapersonal intelligence. # Mostly True . Questions 5, 10, 15: Musical intelligence. # Mostly True .

Educational institutions tend to stress the logical– mathematical and verbal–linguistic forms of learning. How do your intelligences align with the changes taking place in the world? Would you rather rely on using one intelligence in depth or develop multiple intelligences? Any intelligence above for which you received a score of three is a major source of learning for you, and a score of zero means you may not use it at all. How do your intelli- gences fit your career plans and your aspirations for the type of leader you want to be?

Sources: Based on Kirsi Tirri, Petri Nokelainen, and Martin Ubani, “Conceptual Definition and Empirical Validation of the Spiritual Sensitivity Scale,” Journal of Empirical Theology 19 (2006), pp. 37–62; and David Lazear, “Seven Ways of Knowing: Teaching for Multiple Intelligences,” (Palatine, IL: IRI/Skylight Publishing, 1991).

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leader will seek advice and take time to think through the possible consequences of his or her actions.32

Jim Collins, author of Good to Great and Great by Choice, calls this new breed “Level 5 leaders.”33 In contrast to the view of great leaders as larger-than-life per- sonalities with strong egos and big ambitions, Level 5 leaders often seem shy and unpretentious and have no need to be in the limelight. They are more concerned with the success of the team or company than with their own success.

These leaders are characterized by an almost complete lack of ego, coupled with a fierce resolve to do what is best for the organization. They accept full responsibility for mistakes, poor results, or failures, but they typically give credit for successes to other people. One corporate example is Sir Terry Leahy, who recently retired after more than a decade leading Britain’s Tesco. That is a long and successful tenure for a leader that most people know little about. Leahy didn’t court personal publicity, much to the chagrin of journalists, and he put his energies into promoting Tesco and its employees rather than himself.34 Although most research regarding the new type of leader has been on corporate CEOs like Sir Terry Leahy, it is important to remember that new-paradigm or Level 5 leaders are in all positions in all types of organizations.

HOW LEADERSHIP DIFFERS FROM MANAGEMENT Management can be defined as the attainment of organizational goals in an effective and efficient manner through planning, organizing, staffing, directing, and control- ling organizational resources. So, what is it that distinguishes the process of leader- ship from that of management? Managers and leaders are not inherently different types of people. There are managers at all hierarchical levels who are also good lea- ders, and many people can develop the qualities needed for effective leadership and management. Both are essential in organizations and must be integrated effectively

Consider Should Leaders Live by the Cowboy Code?

1. A cowboy never takes unfair advantage—even of an enemy. 2. A cowboy never goes back on his word or betrays a trust. 3. A cowboy always tells the truth. 4. A cowboy is kind and gentle with children, the elderly, and animals. 5. A cowboy is free from racial or religious prejudice. 6. A cowboy is always helpful and lends a hand when anyone is in trouble. 7. A cowboy is a good worker. 8. A cowboy stays clean in thought, speech, action, and personal habits. 9. A cowboy respects womanhood, parents, and the laws of his nation.

10. A cowboy is a patriot to his country.

Source: Gene Autry’s Cowboy Commandments are reported, with some variations in wording, in multiple sources.

NEW LEADER ACTION MEMO As a leader, you can respond to the reality of change and crisis, the need for empowerment, collaboration, and diversity, and the importance of a higher purpose. You can channel your ambition toward achieving larger organizational goals rather than feeding your own ego.

Management the attainment of organiza- tional goals in an effective and efficient manner through planning, organiz- ing, staffing, directing, and controlling organizational resources

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 13

to lead to high performance.35 That is, leadership cannot replace management; the two have to go hand-in-hand.

Exhibit 1.3 compares management to leadership in five areas crucial to organi- zational performance—providing direction, aligning followers, building relation- ships, developing personal qualities, and creating leader outcomes.36

Providing Direction Both leadership and management are concerned with providing direction for the organization, but there are differences. Management focuses on establishing detailed plans and schedules for achieving specific results, then allocating resources to accom- plish the plan. Leadership calls for creating a compelling vision of the future, setting the context within which to view challenges and opportunities, and developing far- sighted strategies for producing the changes needed to achieve the vision. Whereas management calls for keeping an eye on the bottom line and short-term results, lead- ership means keeping an eye on the horizon and the long-term future.

A vision is a picture of an ambitious, desirable future for the organization or team. It can be as lofty as Motorola’s aim to “become the premier company in the world” or as down-to-earth as the Swedish company IKEA’s simple vision “to pro- vide affordable furniture for people with limited budgets.”

NEW LEADER ACTION MEMO You can evaluate your own leadership potential by com- pleting the quiz in Leader’s Self-Insight 1.2.

EXHIBIT 1.3 Comparing Management and Leadership

Sources: Based on John P. Kotter, A Force for Change: How Leadership Differs from Management (New York: The Free Press, 1990) and ideas in Kevin Cashman, “Lead with Energy,” Leadership Excellence (December 2010), p. 7; Henry Mintzberg, Managing (San Francisco: Berrett-Koehler, 2009); and Mike Maddock, “The One Talent That Makes Good Leaders Great,” Forbes (September 26, 2012), www.forbes.com/sites/mikemaddock/2012/09/26/the-one-talent-that-makes-good-leaders-great/ (accessed March 7, 2013).

Vision a picture of an ambitious, desirable future for the organization or team

14 PART 1 INTRODUCTION TO LEADERSHIP

Aligning Followers Management entails organizing a structure to accomplish the plan; staffing the structure with employees; and developing policies, procedures, and systems to direct employees and monitor implementation of the plan. Leadership is concerned instead with communicating the vision and developing a shared culture and set of core values that can lead to the desired future state. Whereas the vision describes the destination, the culture and values help define the journey toward it so that everyone is lined up in the same direction.

Leadership provides learning opportunities so people can expand their minds and abilities and assume responsibility for their own actions. Think about classes you have taken at your college or university. In some classes, the professor tells stu- dents exactly what to do and how to do it, and many students expect this kind of direction and control. Have you ever had a class where the instructor instead inspired and encouraged you and your classmates to find innovative ways to meet goals? The difference reflects a rational management versus a leadership approach.

Building Relationships In terms of relationships, management focuses on getting the most results out of people so that production goals are achieved and goods and services are provided to customers in a timely manner. Leadership, on the other hand, focuses on invest- ing more in people so they are energized and inspired to accomplish goals.

Whereas the management relationship is based on position and formal author- ity, leadership is a relationship based on personal influence and trust. For example, in an authority relationship, both people accept that a manager can tell a subordi- nate to be at work at 7:30 A.M. or her pay will be docked. Leadership, on the other hand, relies on influence, which is less likely to use coercion. The role of leadership is to attract and energize people, motivating them through purpose and challenge rather than rewards or punishments.37 The differing source of power is one of the key distinctions between management and leadership. Take away a manager’s for- mal position, and will people choose to follow her? That is the mark of a leader.

Developing Personal Leadership Qualities Leadership is more than a set of skills; it relies on a number of subtle personal quali- ties that are hard to see but that are very powerful. These include things like enthusi- asm, integrity, courage, and humility. First of all, good leadership springs from a genuine caring for the work and a genuine concern for other people. The process of management generally encourages emotional distance, but leadership means being emotionally connected to others. Where there is leadership, people become part of a community and feel that they are contributing to something worthwhile. Whereas management means providing answers and solving problems, leadership requires the courage to admit mistakes and doubts, to listen, and to trust and learn from others.

Developing leadership qualities takes work. For leadership to happen, leaders may have to undergo a journey of self-discovery and personal understanding.38

Leadership experts agree that a top characteristic of effective leaders is that they know who they are and what they stand for. In addition, leaders have the courage to act on their beliefs.

True leaders tend to have open minds that welcome new ideas rather than closed minds that criticize new ideas. Leaders listen and discern what people want and need more than they talk to give advice and orders. Leaders are willing to be nonconformists,

NEW LEADER ACTION MEMO As a leader, you can awaken your leadership qualities of enthusiasm, integrity, courage, and moral commitment. You can make emotional connec- tions with followers to increase your leadership effectiveness.

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 15

to disagree and say no when it serves the larger good, and to accept nonconformity from others rather than try to squeeze everyone into the same mindset.

Creating Outcomes The differences between management and leadership create two differing outcomes, as illustrated at the bottom of Exhibit 1.3. Management maintains a degree of

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C a CLEADER’S SELF-INSIGHT 1.2

Your Leadership Potential

Instructions: Questions 1–6 below are about you right now. Questions 7–14 are about how you would like to be if you were the head of a major department at a corporation. Answer Mostly False or Mostly True to indicate whether the item describes you accurately or whether you would strive to per- form each activity as a department head.

Now Mostly False

Mostly True

1. When I have a number of tasks or homework assignments to do, I set priorities and organize the work to meet the deadlines.

2. When I am involved in a serious disagreement, I hang in there and talk it out until it is completely resolved.

3. I would rather sit in front of my computer than spend a lot of time with people.

4. I reach out to include other people in activities or when there are discussions.

5. I know my long-term vision for career, family, and other activities.

6. When solving problems, I prefer analyzing things myself to working through them with a group of people.

Head of Major Department Mostly False

Mostly True

1. I would help subordinates clar- ify goals and how to reach them.

2. I would give people a sense of long-term mission and higher purpose.

3. I would make sure jobs get out on time.

4. I would scout for new product or service opportunities.

5. I would give credit to people who do their jobs well.

6. I would promote unconventional beliefs and values.

7. I would establish procedures to help the department operate smoothly.

8. I would verbalize the higher va- lues that I and the organization stand for.

Scoring and Interpretation Count the number of Mostly True answers to even-numbered questions: . Count the number of Mostly True answers to odd-numbered questions: . Compare the two scores.

The even-numbered items represent behaviors and activities typical of leadership. Leaders are personally involved in shaping ideas, values, vision, and change. They often use an intuitive approach to develop fresh ideas and seek new directions for the department or organization. The odd-numbered items are considered more traditional management activities. Managers respond to organizational problems in an impersonal way, make rational decisions, and work for stability and efficiency.

If you answered yes to more even-numbered than odd-numbered items, you may have potential leadership qualities. If you answered yes to more odd-numbered items, you may have management qualities. Management qualities are an important foundation for new leaders because the organization first has to operate efficiently. Then leadership qualities can enhance performance. Both sets of qualities can be developed or improved with aware- ness and experience.

Sources: Based on John P. Kotter, Leading Change (Boston, MA: Harvard Business School Press, 1996), p. 26; Joseph C. Rost, Leadership for the Twenty-first Century (Westport, CT: Praeger, 1993), p. 149; and Brian Dumaine, “The New Non-Manager Managers,” Fortune (February 22, 1993), pp. 80–84.

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stability, predictability, and order through a culture of efficiency. Leadership, on the other hand, creates change, often radical change, within a culture of agility and integrity that helps the organization thrive over the long haul by promoting openness and honesty, positive relationships, and long-term innovation. Leadership facilitates the courage needed to make difficult and unconventional decisions that may sometimes hurt short-term results.

EVOLVING THEORIES OF LEADERSHIP To understand leadership as it is viewed and practiced today, it is important to rec- ognize that the concept of leadership has changed over time. Leadership typically reflects the larger society, and theories have evolved as norms, attitudes, and under- standings in the larger world have changed.39

Historical Overview of Major Approaches The various leadership theories can be categorized into six basic approaches, each of which is briefly described in this section. Many of these ideas are still applicable to leadership studies today and are discussed in various chapters of this text.

Great Man Theories This is the granddaddy of leadership concepts. The earliest studies of leadership adopted the belief that leaders (who were always thought of as male) were born with certain heroic leadership traits and natural abilities of power and influence. In organizations, social movements, religions, governments, and the military, leadership was conceptualized as a single “Great Man” who put everything together and influenced others to follow along based on the strength of inherited traits, qualities, and abilities.

Trait Theories Studies of these larger-than-life leaders spurred research into the var- ious traits that defined a leader. Beginning in the 1920s, researchers looked to see if leaders had particular traits or characteristics, such as intelligence or energy, that distinguished them from non-leaders and contributed to success. It was thought that if traits could be identified, leaders could be predicted, or perhaps even trained. Although research failed to produce a list of traits that would always guarantee leadership success, the interest in leadership characteristics has continued to the present day.

Behavior Theories The failure to identify a universal set of leadership traits led researchers in the early 1950s to begin looking at what a leader does rather than who he or she is. One line of research focused on what leaders actually do on the job, such as various management activities, roles, and responsibilities. These studies were soon expanded to try to determine how effective leaders differ in their behav- ior from ineffective ones. Researchers looked at how a leader behaved toward followers and how this correlated with leadership effectiveness or ineffectiveness. Chapter 2 discusses trait and behavior theories.

Contingency Theories Researchers next began to consider the contextual and situa- tional variables that influence what leadership behaviors will be effective. The idea behind contingency theories is that leaders can analyze their situation and tailor their behavior to improve leadership effectiveness. Major situational variables are

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 17

the characteristics of followers, characteristics of the work environment and fol- lower tasks, and the external environment. Contingency theories, sometimes called situational theories, emphasize that leadership cannot be understood in a vacuum separate from various elements of the group or organizational situation. Chapter 3 covers contingency theories.

Influence Theories These theories examine influence processes between leaders and followers. One primary topic of study is charismatic leadership (Chapter 12), which refers to leadership influence based not on position or formal authority but, rather, on the qualities and charismatic personality of the leader. Related areas of study are leadership vision (Chapter 13) and organizational culture (Chapter 14). Leaders influence people to change by providing an inspiring vision of the future and shap- ing the culture and values needed to attain it. Several chapters of this text relate to the topic of influence because it is essential to understanding leadership.

Relational Theories Since the late 1970s, many ideas of leadership have focused on the relational aspect, that is, how leaders and followers interact and influence one another. Rather than being seen as something a leader does to a follower, leader- ship is viewed as a relational process that meaningfully engages all participants and enables each person to contribute to achieving the vision. Interpersonal rela- tionships are seen as the most important facet of leadership effectiveness.40 Two sig- nificant relational theories are transformational leadership (Chapter 12) and servant leadership (Chapter 6).

Other important relational topics covered in various chapters of the text include the personal qualities that leaders need to build effective relationships, such as emotional intelligence, a leader’s mind, integrity and high moral standards, and personal courage. In addition, leaders build relationships through motivation and empowerment, leadership communication, team leadership, and embracing diversity.

A Model of Leadership Evolution Exhibit 1.4 provides a framework for examining the evolution of leadership from the early Great Man theories to today’s relational theories. Each cell in the model summarizes an era of leadership thinking that was dominant in its time but may be less appropriate for today’s world.41

Leadership Era 1 This era may be conceptualized as pre-industrial and pre-bureaucratic. Most organizations were small and were run by a single individ- ual who many times hired workers because they were friends or relatives, not nec- essarily because of their skills or qualifications. The size and simplicity of organizations and the stable nature of the environment made it easy for a single person to understand the big picture, coordinate and control all activities, and keep things on track. This is the era of Great Man leadership and the emphasis on personal traits of leaders. A leader was conceptualized as a single hero who saw the big picture and how everything fit into a whole.

Leadership Era 2 In Era 2, we see the emergence of hierarchy and bureaucracy. Although the world remains stable, organizations have begun to grow so large that they require rules and standard procedures to ensure that activities are per- formed efficiently and effectively. Hierarchies of authority provide a sensible

18 PART 1 INTRODUCTION TO LEADERSHIP

mechanism for supervision and control of workers, and decisions once based on rules of thumb or tradition are replaced with precise procedures. This era sees the rise of the “rational manager” who directs and controls others using an impersonal approach. Employees aren’t expected to think for themselves; they are expected to do as they’re told, follow rules and procedures, and accomplish specific tasks. The focus is on details rather than the big picture.

The rational manager was well-suited to a stable environment. The behavior and contingency theories worked here because leaders could analyze their situation, develop careful plans, and control what happened. But rational management is no longer sufficient for leadership in today’s world.

Leadership Era 3 This era represented a tremendous shock to managers in North America and Europe. Suddenly, the world was no longer stable, and the prized techniques of rational management were no longer successful. Beginning with the OPEC oil embargo of 1972 to 1973 and continuing with the severe global competi- tion of the 1980s and early 1990s, many managers saw that environmental condi- tions had become chaotic. The Japanese began to dominate world commerce with their ideas of team leadership and superb quality. This became an era of great con- fusion for leaders. They tried team-based approaches, downsizing, reengineering, quality programs, and empowerment as ways to improve performance and get more motivation and commitment from employees.

EXHIBIT 1.4 Leadership Evolution

NEW LEADER ACTION MEMO As a leader, you can use the leadership skills that fit the correct era for your organiza- tion. You can use influence and relational aspects as appropri- ate for your organization.

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 19

This is the era of the team leader and the change leader. Influence was impor- tant because of the need to change organizational structures and cultures. This era sees the emergence of knowledge work, an emphasis on horizontal collaboration, and a shift to influence theories. Rather than conceiving of leadership as one person always being firmly “in charge,” leadership is often shared among team leaders and members, shifting to the person with the most knowledge or expertise in the matter at hand.42

Leadership Era 4 Enter the digital, mobile, social-media age. It seems that every- thing is changing, and changing fast. Era 4 is the era of the agile leader who has made the leap to giving up control in the traditional sense. Leaders emphasize rela- tionships and networks, and they influence others through vision, meaning, pur- pose, and values rather than management authority and control. They are constantly experimenting, learning, and changing, in both their personal and pro- fessional lives, and they encourage the development and growth of others so that followers are expanding their capabilities and contributing to innovation. Era 4 requires the full scope of leadership that goes far beyond rational management or even team leadership.

Implications The flow from Great Man leadership to rational management to team leadership to agile leadership illustrates trends in the larger world. The implication is that leadership reflects the era or context of the organization and society. Most of today’s organizations and leaders are still struggling with the transition from a sta- ble to a chaotic environment and the new skills and qualities needed in this circum- stance. Thus, Era 3 issues of diversity, team leadership, empowerment, and horizontal relationships are increasingly relevant. In addition, many leaders are rap- idly shifting into Era 4 leadership by focusing on change management and facilitat- ing a vision and values to encourage high performance, agility, and continuous adaptation in a fast-shifting world. Agile leaders align themselves with new social technologies that can create networks of leaders throughout the organization. Era 3 and Era 4 leadership is what much of this book is about.

LEADERSHIP CAN BE LEARNED Many leaders are caught in the transition between the practices and principles that defined the industrial era and the new reality of the twenty-first century. Attempts to achieve collaboration, empowerment, and diversity in organi- zations may fail because the beliefs and thought processes of leaders as well as employees are stuck in an old paradigm that values control, stability, and homoge- neity. It is difficult for many leaders to let go of methods and practices that have made them and their organizations successful in the past. Yet leaders can make the leap to a new paradigm by intentionally practicing and applying new paradigm principles.

Leader Fatal Flaws One of the most important aspects of shifting to the new paradigm of leadership is intentionally using soft, interpersonal skills to build a culture of performance, trust,

NEW LEADER ACTION MEMO Leader’s Self-Insight 1.3 gives you a chance to test your people skills and see if there are areas you need to work on.

Agile leader a leader who is open to learning and change and encourages the growth and development of others

20 PART 1 INTRODUCTION TO LEADERSHIP

and collaboration. A few clues about the importance of acquiring new leadership skills are brought to light by studies that look at what causes managers to “derail” in their careers. Derailment refers to a phenomenon in organizations in which a manager with an impressive track record reaches a certain level but goes off track and can’t advance because of a mismatch between job needs and the man- ager’s personal skills and qualities.43 Studies conducted in numerous organizations in different countries indicate that managers fail more frequently because they are deficient with soft, human skills rather than a lack of hard work or technical skills.44 Derailed managers are successful people who excelled in a functional area and were expected to go far, but they reached a plateau, were fired, or were forced to retire early.

Researchers at the Center for Creative Leadership in Greensboro, North Carolina, have been looking at what causes manager derailment for two decades.45

They conclude that there are five top flaws that cause managers to derail, as shown in Exhibit 1.5. Note that many of these flaws relate to the lack of human skills. Unsuccessful managers fail to meet business objectives because they spend too much time promoting themselves rather than working. They are overly ambitious and selfish and may not follow through on promises. They are often insensitive and critical, not trustworthy, do not learn from feedback and mistakes, can’t build and develop the right teams, and are unable to see the big picture when promoted into a general management position. Additional studies confirm that the biggest leader mistakes are people mistakes rather than technical ones.46

Leader Good Behaviors The best leaders, at all levels, are those who are genuinely interested in other people and find ways to bring out the best in them.47 Successful organizations, such as Google, pay attention to developing leaders in the soft skills needed to effectively lead technical people in a changing environment.

EXHIBIT 1.5 Five Fatal Flaws That Cause Derailment

Source: Based on Yi Zhang, Jean Brittain Leslie, and Kelly M. Hannum, “Trouble Ahead: Derailment Is Alive and Well,” Thunderbird International Business Review 55, no. 1 (January–February 2013), pp. 95–102.

Derailment a phenomenon in which a manager with an impressive track record reaches a cer- tain level but goes off track and can’t advance because of a mismatch between job needs and personal skills and qualities

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 21

IN THE LEAD Google In 2013, Google was named the best company to work for by Fortune magazine for the fourth year in a row. Being a great place to work didn’t happen by accident. Google’s human resources department, called People Operations—or POPS for short—monitors employees’ happiness and well-being to an incredible degree, using data to track every- thing and learn where improvements are needed.

One thing it discovered is that good leaders make a tremendous difference. Google looked at what successful leaders—those who have lower attrition rates and get better

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C a CLEADER’S SELF-INSIGHT 1.3

Are You on a Fast Track to Nowhere?

Instructions: Many people on the fast track toward positions of leadership find themselves suddenly derailed and don’t know why. Many times, a lack of people skills is to blame. To help you determine whether you need to work on your people skills, take the following quiz, answering each item as Mostly False or Mostly True. Think about a job or volunteer position you have now or have held in the past as you answer the following items.

People Skills Mostly False

Mostly True

1. Other people describe me as very good with people.

2. I frequently smile and laugh with teammates or classmates.

3. I frequently reach out to engage people, even strangers.

4. I often express appreciation to other people.

Dealing with Authority Mostly False

Mostly True

1. I quickly speak out in meetings when leaders ask for comments or ideas.

2. If I see a leader making a decision that seems harmful, I speak up.

3. I experience no tension when interacting with senior managers, either inside or outside the organization.

4. I have an easy time asserting my- self toward people in authority.

Networking Mostly False

Mostly True

1. I spend part of each week net- working with colleagues in other departments.

2. I have joined multiple organiza- tions for the purpose of making professional contacts.

3. I frequently use lunches to meet and network with new people.

4. I actively maintain contact with peers from previous organizations.

Scoring and Interpretation Tally the number of “Mostly Trues” checked for each set of questions.

People Skills: Dealing with Authority: Networking:

If you scored 4 in an area, you’re right on track. Continue to act in the same way.

If your score is 2–3, you can fine-tune your skills in that area. Review the questions where you said Mostly False and work to add those abilities to your leadership skill set.

A score of 0–1 indicates that you may end up dangerously close to derailment. You should take the time to do an in- depth self-assessment and find ways to expand your inter- personal skills.

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performance from their teams—do that makes them different from less successful ones. Analyzing performance reviews and feedback surveys, Google executives used the findings to help make bad leaders better. Even in a company that depends on technical expertise, Google found that soft, human skills are essential. Technical expertise ranked dead last among eight desirable leader qualities, as shown in the exhibit below.

Google discovered that employees want leaders who listen to them, build positive and productive relationships, and show an interest in their lives and careers. When the company targeted unsuccessful leaders and coached them to develop soft skills and display these eight behaviors, the managerial ranks improved, with collective feedback scores going up every year since 2009.48

Google’s Eight Rules for Good Leader Behavior 1. Be a good coach. 2. Empower your team and don’t micromanage. 3. Express interest in team members’ success and personal well-being. 4. Don’t be a sissy. Be productive and results-oriented. 5. Be a good communicator and listen to your team. 6. Help your employees with career development. 7. Have a clear vision and strategy for the team. 8. Have key technical skills so you can help advise the team.49

The skills on Google’s list of desirable behaviors can help leaders avoid the fatal flaws that derail careers. In addition, today’s successful leaders intentionally value change over stability, empowerment over control, collaboration over compe- tition, diversity over uniformity, and integrity over self-interest, as discussed earlier. The industry of executive coaching emerged partly to help people through the tran- sition to a new paradigm of leadership. Executive coaches encourage leaders to con- front their own flaws and hang-ups that inhibit effective leadership, and then help them develop stronger emotional and interpersonal skills.

MASTERING THE ART AND SCIENCE OF LEADERSHIP There’s an age-old question: Are leaders born or made? In one survey, 19 percent of top executives said leaders are born, 52 percent said they are made, and 29 percent said they are both born and made.50 It may be true that some inborn qualities and personality characteristics can provide a foundation for being a good leader, but most people can learn to be good leaders no matter their innate characteristics. Interestingly, in the above-mentioned survey, both those who thought leaders are born and those who thought they are made mention learning from experience as a key to becoming a good leader.

Leadership can be learned, but it is important to remember that leadership is both an art and a science. It is an art because many leadership skills and qualities cannot be learned from a textbook. Leadership takes practice and hands-on experi- ence, as well as intense personal exploration and development. However, leadership is also a science because a growing body of knowledge and objective facts describes the leadership process and how to use leadership skills to attain organizational goals. This is where a textbook or a course on leadership can help you to be a better leader.

NEW LEADER ACTION MEMO As a leader, you can cultivate your people skills to avoid executive derailment. You can treat others with kindness, interest, and respect and avoid overmanaging by selecting good followers and delegating effectively.

I suspect that the true heroes are largely un- sung and prefer to remain that way. They prefer to give credit to others, to remain behind the scenes, to avoid grandi- ose statements and predictions and promises, and to perform better than anyone expected them to. Howard Gardner, Harvard Psychologist

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 23

Knowing about leadership research helps people analyze situations from a variety of perspectives and learn how to be more effective. By exploring leadership in both business and society, students gain an understanding of the importance of leadership to an organization’s success, as well as the difficulties and challenges involved in being a leader. Studying leadership can also lead to the discovery of abilities you never knew you had. When students in a leadership seminar at Wharton were asked to pick one leader to represent the class, one woman was surprised when she outpolled all other students. Her leadership was drawn out not in the practice of leadership in student government, volunteer activities, or athletics but in a classroom setting.51 Studying lead- ership gives you skills you can apply to the practice of leadership in your everyday life. Exhibit 1.6 gives some tips for how you can begin honing your leadership skills.

Many people have never tried to be a leader because they have no understand- ing of what leaders actually do. The chapters in this book are designed to help you gain a firm knowledge of what leadership means and some of the skills and quali- ties that make a good leader. You can build competence in both the art and the science of leadership by completing the Self-Insight exercises throughout the book, by working on the activities and cases at the end of each chapter, and by applying the concepts you learn in class, in your relationships with others, in student groups, at work, and in voluntary organizations. Although this book and your instructors can guide you in your development, only you can apply the concepts and principles of leadership in your daily life. Learning to be a leader starts now, with you. Are you up to the challenge?

EXHIBIT 1.6 Learning to Be a Leader

Source: Based on “Guidelines for the Apprentice Leader,” in Robert J. Allio, “Masterclass: Leaders and Leadership—Many Theories, But What Advice Is Reliable?” Strategy & Leadership 41, no. 1 (2013), pp. 4–14.

24 PART 1 INTRODUCTION TO LEADERSHIP

ORGANIZATION OF THIS BOOK The plan for this book reflects the shift to a new paradigm summarized in Exhibit 1.2 and the discussion of management versus leadership summarized in Exhibit 1.3. The framework in Exhibit 1.7 illustrates the organization of the book.

Part 1 introduces leadership, its importance, and the transition to a new leader- ship paradigm. Part 2 explores basic research perspectives that evolved during a more stable time when rational management approaches were effective. These basic perspectives, including the Great Man and trait theories, behavior theories, and contingency theories, are relevant to dealing with specific tasks and individuals and are based on a premise that leaders can predict and control various aspects of the environment to keep the organization running smoothly.

Parts 3, 4, and 5 focus on leadership perspectives that reflect the paradigm shift to the turbulent, unpredictable nature of the environment and the need for fresh leader approaches. Part 3 discusses the personal side of leadership and looks at some of the qualities and forces that are required to be effective in the new reality. These chapters emphasize the importance of self-awareness and self-understanding, the development of one’s own leadership mind and heart, moral leadership and courage, and appreciat- ing the role of followership. Part 4 is about building effective relationships, including motivating and empowering others, communicating as a leader, leading teams, embracing the diversity of today’s world, and using power and influence.

EXHIBIT 1.7 Framework for the Book

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 25

Part 5 brings together all of these ideas to examine the leader as builder of a social architecture that can help an organization create a brighter future. These chapters deal with creating vision and strategic direction, aligning culture and values to achieve the vision, and leading change.

Taken together, the sections and chapters paint a complete portrait of the lead- ership experience as it has evolved to the present day and emphasize the new para- digm skills and qualities that are relevant from today and into the future. This book blends systematic research evidence with real-world experiences and impact.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • This chapter introduced the concept of leadership and explained how indivi-

duals can grow as leaders. Leadership is defined as an influence relationship among leaders and followers who intend real changes and outcomes that reflect their shared purposes. Thus leadership involves people in a relationship, influ- ence, change, a shared purpose, and taking personal responsibility to make things happen. Most of us are aware of famous leaders, but most leadership that changes the world starts small and may begin with personal frustrations about events that prompt people to initiate change and inspire others to follow them. Your leadership may be expressed in the classroom, at work, or in your neighborhood, religious community, or volunteer organizations.

• Concepts of leadership have evolved over time. Major research approaches include Great Man theories, trait theories, behavior theories, contingency theo- ries, influence theories, and relational theories. Elements of all these approaches are still applicable to the study of leadership.

• The biggest challenge facing leaders today is the changing world that wants a new paradigm of leadership. The new reality involves the shift from stabil- ity to change, from control to empowerment, from competition to collabora- tion, and from uniformity to diversity. In addition, the concept of leader as hero is giving way to that of the humble leader who develops others and shares credit for accomplishments. These dramatic changes suggest that a philosophy based on control and personal ambition will probably fail in the new era. The challenge for leaders is to evolve to a new mindset that relies on human skills, integrity, and teamwork.

• The “soft” skills of leadership complement the “hard” skills of management, and both are needed to effectively guide organizations. Although leadership is often equated with good management, leadership and management are differ- ent processes. Management strives to maintain stability and improve effi- ciency. Leadership, on the other hand, is about creating a vision for the future, designing social architecture that shapes culture and values, inspiring and motivating followers, developing personal qualities, and creating change within a culture of integrity. Leadership can be integrated with management to achieve the greatest possible outcomes. Organizations need to be both man- aged and led, particularly in today’s turbulent environment. Many managers already have the qualities needed to be effective leaders, but they may not have gone through the process needed to bring these qualities to life.

Tw itt er

26 PART 1 INTRODUCTION TO LEADERSHIP

Leadership is an intentional act. It is important to remember that most people are not born with natural leadership skills and qualities, but leadership can be learned and developed.

DISCUSSION QUESTIONS 1. Look through recent magazines and newspapers and identify one leader who seems to illus-

trate the “leader-as-hero” mindset and one who seems more typical of the humble Level 5 leader described in the text. Describe their differing characteristics. Which was easier to find?

2. What do you consider your own strengths and weaknesses for leadership? Discuss your answer with another student.

3. Of the elements in the leadership definition as illustrated in Exhibit 1.1, which is the easiest for you? Which is hardest? Explain.

4. How might the paradigm shift from competition to collaboration make the job of a leader more difficult? Could it also make the leader’s job easier? Discuss.

5. Describe the best leader you have known. How did this leader acquire his or her capability?

6. Why do you think there are so few people who succeed at both management and leadership? Is it reasonable to believe someone can be good at both? Discuss.

7. Discuss some recent events and societal changes that might have contributed to a shift “from hero to humble.” Do you agree or disagree that humility is important for good leadership?

8. “Leadership is more concerned with people than is management.” Do you agree? Discuss.

9. What personal capacities should a person develop to be a good leader versus those developed to be a good manager?

10. Why is leadership considered both an art and a science?

Complete this assignment online with CengageNOW.

C a C

LEADERSHIP AT WORK Leadership Right–Wrong Leader Wrong: Think of a specific situation in which you were working with someone who was in a leadership position over you and that person was doing something that was wrong for you. This person might have been a coach, teacher, team leader, employer, immediate boss, family member, or anyone who had a leadership position over you. “Wrong for you” means that person’s behavior reduced your effectiveness, made you or your coworkers less productive, and was demotivating to you or your colleagues. Write a few words below that describe what the leader was doing that was wrong for you.

Think of a second situation in which someone in a leadership position did something wrong for you. Write a few words below that describe what the leader was doing that was wrong for you.

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 27

Leader Right: Think of a specific situation in which you were working with someone who was in a leadership position over you and that person was doing something that was right for you. This person might have been a coach, teacher, team leader, employer, immediate boss, family member, or anyone who had a leadership position over you. “Right for you” means that person’s behavior made you or your coworkers more productive, highly moti- vated you or others, and removed barriers to make you more successful. Write a few words below that describe what the leader was doing that was right for you.

Think of a second situation in which someone in a leadership position did something right for you. Write a few words below that describe what the leader was doing that was right for you.

The previous answers are data points that can help you understand the impact of leader behaviors. Analyze your four incidents—what are the underlying qualities of leadership that enable you to be an effective performer? Discuss your answers with another student. What leadership themes are present in the eight combined incidents? What do these responses tell you about the qualities you want and don’t want in your leaders?

In Class: An interesting way to use this exercise in class is to have students write (five words maximum) their leader “rights” on one board and their leader “wrongs” on another board. The instructor can ask small groups to identify underlying themes in the collective set of leader data points on the boards to specify what makes an effective leader. After students establish four or five key themes, they can be challenged to identify the one key theme that distinguishes leaders who are effective from those who are not.

Source: Based on Melvin R. McKnight, “Organizational Behavior as a Phenomenological, Free-Will Centered Science,” Working Paper, College of Business Administration, Northern Arizona University, 1997.

Check out CengageNOW for additional cases with interactive activities.

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LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Sales Engineering Division When DGL International, a manufacturer of refinery equipment, brought in John Terrill to man- age its Sales Engineering division, company executives informed him of the urgent situation. Sales Engineering, with 20 engineers, was the highest-paid, best-educated, and least-productive division in the company. The instructions to Terrill: Turn it around. Terrill called a meeting of the engineers. He showed great concern for their personal welfare and asked point blank: “What’s the problem? Why can’t we produce? Why does this division have such turnover?”

Without hesitation, employees launched a hail of complaints. “I was hired as an engineer, not a pencil pusher.” “We spend over half of our time writing asinine reports in triplicate for top management, and no one reads the reports.” “We have to account for every penny, which doesn’t give us time to work with customers or new developments.”

After a two-hour discussion, Terrill began to envision a future in which engineers were free to work with customers and join self-directed teams for product improvement. Terrill concluded he had to get top management off the engineers’ backs. He promised the

28 PART 1 INTRODUCTION TO LEADERSHIP

engineers, “My job is to stay out of your way so you can do your work, and I’ll try to keep top management off your backs, too.” He called for the day’s reports and issued an order effective immediately that the originals be turned in daily to his office rather than mailed to headquarters. For three weeks, technical reports piled up on his desk. By month’s end, the stack was nearly three feet high. During that time no one called for the reports. When other managers entered his office and saw the stack, they usually asked, “What’s all this?” Terrill answered, “Technical reports.” No one asked to read them.

Finally, at month’s end, a secretary from finance called and asked for the monthly travel and expense report. Terrill responded, “Meet me in the president’s office tomorrow morning.”

The next morning the engineers cheered as Terrill walked through the department push- ing a cart loaded with the enormous stack of reports. They knew the showdown had come.

Terrill entered the president’s office and placed the stack of reports on his desk. The president and the other senior executives looked bewildered.

“This,” Terrill announced, “is the reason for the lack of productivity in the Sales Engineering division. These are the reports your people require every month. The fact that they sat on my desk all month shows that no one reads this material. I suggest that the engi- neers’ time could be used in a more productive manner, and that one brief monthly report from my office will satisfy the needs of the other departments.”

QUESTIONS

1. Does John Terrill’s leadership style fit the definition of leadership in Exhibit 1.1? Is it part of a leader’s job to manage upward? Explain.

2. With respect to Exhibit 1.4, in what leadership era is Terrill? In what era is headquar- ters? Explain.

3. What approach would you have taken in this situation? What do you think the response of the senior executives will be to Terrill’s action?

The Marshall Plan Marshall Gordon was recognized by associates and competitors as a man on a mission. One of four members of the design team for a large chair manufacturing corporation, Marshall’s obsession with the creation of comfortable seating dated to a childhood back injury and a lifetime of pain. He recognized, more than most in the industry, the importance of designing chairs that offered some relief to those suffering from debilitating back, hip, and neck pain as well as helping people of all ages to avoid problems with proper posture. In his early days with the company the staff jokingly called his approach the Marshall Plan, after America’s 1947 initiative (named for Secretary of State George Marshall) to rebuild European economies after the war. Like someone fighting to save the world, Marshall Gordon brought passion and a creative intensity to design meetings as if each drawing, each design tweak would change civilization as we knew it.

Single and with no apparent family or friendship ties, Marshall was married to his work. He seemed to thrive on 70-hour work weeks, although as a salaried manager, he received no overtime pay. Even his “down time” at meals or on weekends was spent sketching, studying the latest in ergonomics, or reconnoitering each design adjustment by competitors.

“When you visit a furniture store, you fully expect to see Marshall, skulking about in trench coat and hat, checking to see what the competition is offering,” says fellow team member John Craddock. “We all laugh about it. The guy brings—actually brings—chairs to meetings and tears them apart to show us some miniscule discovery.”

This obsession with chairs, pain and gravity, and one-upping the competition has made Marshall a valuable employee and earned him a reputation in the industry for creative design. Not since Peter Opsvik’s Gravity Balans ergonomic chair of the 1970s has anyone made such an impact on the industry. The effect of Marshall’s work on company profits is undeniable. The fact that competitors are chomping at the bit to lure him away is also undeniable.

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 29

But the Marshall Plan comes at a price. Over the 15 years he has worked with the com- pany, five as leader of the design group, there has been a constant turnover within the design group as frustrated workers leave the company to “get away from Marshall.”

“Anything you could learn from this brilliant and dedicated man is destroyed by his cold, calculating attitude,” Craddock complains. “I came to this company excited about the chance to work with him. But any knowledge he possesses is carefully guarded. His design ideas are perfect, while ours are picked apart. We all swear he has listening devices scattered around everywhere, because if the rest of the team huddles in some corner of the world to discuss a design idea, voila! He walks into the next meeting with our idea. Once when he was a few minutes late to a meeting, we thought we had beaten him and quickly presented our idea. Just then, he walks in, and announces, ‘Ideas must be in the air. I have something very similar,’ and throws his completed design on screen. Guess who won.”

Marshall presents a continuing challenge to company management, having both incredible positive and negative influence on the culture. While his contributions to design and profits far exceed those of other employees, his negative effect on the culture and his team’s creativity and morale results in the loss of talented people and a climate of suspicion and discontent. His threat, “I can take my talents elsewhere,” hangs over top management like a sledge hammer.

Now, Craddock and Leslie Warren, other talented members of the design team, have approached management with their own ultimatum: Do something about Marshall or we resign.

QUESTIONS

1. If you were a top leader, how would you respond to the ultimatum? Be specific. Explain why.

2. What is Marshall missing with respect to his leadership abilities? How do you explain his poor leadership behavior?

3. If you were Marshall’s manager, how might you increase Marshall’s awareness of the negative impact he is having on his team? How would you guide him toward better team leadership, sharing his knowledge with others, and mentoring his team members?

REFERENCES 1. Nancy F. Koehn, “Lincoln’s School of Management,” The New York

Times (January 26, 2013); Catherine L. Moreton, “10 Qualities That Make Abraham Lincoln a Great Leader,” HR and Employment Law White Papers, Business and Legal Resources (June 25, 2008), https:// hr.blr.com/whitepapers/Staffing-Training/Leadership/10-Qualities- that-Made-Abraham-Lincoln-a-Great-Lea (accessed March 4, 2013); and Hitendra Wadhwa, “Lessons in Leadership: How Lincoln Became America’s Greatest President,” Inc.com (February 12, 2012), http:// www.inc.com/hitendra-wadhwa/lessons-in-leadership-how-abraham- lincoln-became-americas-greatest-president.html (accessed March 4, 2013). The Howard Schultz quote is from Koehn.

2. David Rothkopf, “Somebody Take Control. (Anybody. Really. Please.): Where Are All the Leaders?” The Washington Post (March 29, 2009), p. B1.

3. Thanks to Doug Moran, “Great Leadership,” Leadership Excellence (September 2011), p. 18, for this analogy.

4. John F. Burns and Stephen Castle, “BBC’s Leaders Faulted as Lax in Handling Sex Abuse Crisis,” The New York Times (December 19, 2012), http://www.nytimes.com/2012/12/20/world/europe/pollard- report-bbc-jimmy-savile-sexual-abuse-inquiry.html?pagewanted= all&_r=0 (accessed March 4, 2013).

5. “Sen. Grassley Probes Televangelists’ Finances,” USA TODAY (Novem- ber 7, 2007), http://usatoday30.usatoday.com/news/washington/2007-11- 07-televangelist-probe_N.htm (accessed March 4, 2013).

6. See various surveys and studies reported in Paul Harris, “Leadership Role Models Earn Trust and Profits, T+D 64, no. 3 (2010), pp. 47–50.

7. Gary Cohen, “Defining Leadership,” Leadership Excellence (August 2009), pp. 16–17; Warren Bennis and Burt Nanus, Leaders: The Strategies for Taking Charge (New York: Harper & Row, 1985), p. 4; and James MacGregor Burns, Leadership (New York: Harper & Row, 1978), p. 2.

8. J. Meindl, S. Ehrlich, and J. Dukerich, “The Romance of Leadership,” Administrative Science Quarterly 30 (1985), pp. 78–102; and Mitchell C. Bligh, Jeffrey C. Kohles, and Rajnandini Pillai, “Roman- cing Leadership: Past, Present, Future,” The Leadership Quarterly 22 (2011), pp. 1058–1077.

9. Rakesh Khurana, “The Curse of the Superstar CEO,” Harvard Business Review (September 2002), pp. 60–66.

10. Khurana, “The Curse of the Superstar CEO”; Mitch McCrimmon, “The Ideal Leader,” Ivey Business Journal (January–February 2011); Joseph A. Raelin, “The Myth of Charismatic Leaders,” Training and Development (March 2003), p. 46; and Betsy Morris, “The New Rules,” Fortune (July 24, 2006), pp. 70–87.

11. Joseph C. Rost, Leadership for the Twenty-First Century (Westport, CT: Praeger, 1993), p. 102; and Joseph C. Rost and Richard A. Barker, “Leadership Education in Colleges: Toward a 21st Century

30 PART 1 INTRODUCTION TO LEADERSHIP

Paradigm,” The Journal of Leadership Studies 7, no. 1 (2000), pp. 3–12.

12. Peter B. Smith and Mark F. Peterson, Leadership, Organizations, and Culture: An Event Management Model (London: Sage Publications, 1988), p. 14.

13. Robert E. Kelley, “In Praise of Followers,” Harvard Business Review (November–December 1988), pp. 142–148.

14. “Barbara Van Dahlen” segment in “The World’s 100 Most Influential People 2012,” Time, http://www.time.com/time/specials/packages/ article/0,28804,2111975_2111976,00.html (accessed March 4, 2013); and Barbara Van Dahlen, “Recognizing Options for Healing This Veterans Day,” Huffington Post (November 13, 2012), http:// www.huffingtonpost.com/barbara-van-dahlen-phd/veterans-health- care_b_2092411.html (accessed March 4, 2013).

15. Scott R. Schmedel, “Making a Difference,” The Wall Street Journal (August 21, 2006), pp. R5, R12; and “More Than Wheels: About,” http://www.morethanwheels.org/about (accessed March 5, 2012).

16. Bill George, “Truly Authentic Leadership” (Special Report: America’s Best Leaders), U.S. News & World Report (October 30, 2006), pp. 52–53; Victoria Strauss, “It’s Time for Teach for America to Fold: Former TFAer,” (The Answer Sheet blog), The Washington Post (February 28, 2013), http://www.washingtonpost.com/blogs/answer- sheet/wp/2013/02/28/its-time-for-teach-for-america-to-fold-former- tfaer/ (accessed March 5, 2013); and “Is Teach for America Working?” (Room for Debate Opinion Page), The New York Times (August 30, 2012), http://www.nytimes.com/roomfordebate/2012/08/ 30/is-teach-for-america-working/ (accessed March 5, 2013).

17. These changes and challenges are based in part on Thomas W. Malnight and Tracey S. Keys, “The Great Power Shift: 10 Trends Business Leaders Need to Watch in 2013,” as reported in “The World in 2013: Global Trends for 2013; A Top Ten for Business Leaders,” Cassandra blog, The Economist (November 26, 2012), http://www. economist.com/blogs/theworldin2013/2012/11/global-trends-2013 (accessed March 5, 2013). The complete Global Trends 2013 report is available for purchase at http://www.globaltrends.com/reports/ gt-2013.

18. Center for Creative Leadership survey reported in Andre Martin, “What Is Effective Leadership Today? A New Study Finds Collabora- tion Prized over Heroics,” Chief Executive (July–August 2006), p. 24.

19. This discussion is based on Dominic Barton, Andrew Grant, and Michelle Horn, “Leading in the 21st Century,” McKinsey Quarterly, no. 3 (2012), pp. 30–47; Olivia Parr Rud, “Book Highlight—Adaptability: A Key to Business Intelligence Success,” Global Business and Organiza- tional Excellence (January–February 2010), pp. 76–85; Ken Shelton, “Reinventing Leadership,” Leadership Excellence (July 2012), p. 9; Fahri Karakas, “The Twenty-First Century Leader: Social Artist, Spiritual Visionary, and Cultural Innovator,” Global Business and Organizational Excellence (March/April 2007), pp. 44–50; Daniel C. Kielson, “Leadership: Creating a New Reality,” The Journal of Leadership Studies 3, no. 4 (1996), pp. 104–116; and Mark A. Abramson, “Leadership for the Future: New Behaviors, New Roles, and New Attitudes,” The Public Manager (Spring 1997).

20. No rih i k o S h iro u zu , P h red Dv o ra k , Yu k a Ha y a shi , a nd Andrew Morse, “Bid to ‘Protect Assets’ Slowed Reactor Fight,” The Wall Street Journal (March 19, 2011), http://online.wsj.com/ article/SB10001424052748704608504576207912642629904.html (accessed August 6, 20120); and Peter Valdes-Dapena, “Japan Earthquake Impact Hits U.S. Auto Plants,” CNNMoney (March 30, 2011), http://money.cnn.com/2011/03/28/autos/japan_earthquake_ autos_outlook/index.htm# (accessed June 13, 2012).

21. Peter Wonacott, “An Entrepreneur Weathers a Tumultuous Arab Spring,” The Wall Street Journal (January 17, 2012), http://online. w s j . c o m / a r t i c l e / S B 1 0 0 0 1 4 2 4 0 5 2 9 7 0 2 0 3 4 3 6 9 0 4 5 7 7 1 5 0 6 9 0233235850.html (accessed June 27, 2012); Mary Gooderham,

“Companies That Go Where Others Fear to Tread,” The Globe and Mail (June 21, 2012), p. B7; and Cynthia Koons, “Australia’s Leighton Digs a Hole in the Middle East,” segment in “Heard on the Street—Financial Analysis and Commentary,” The Wall Street Journal Asia (February 15, 2012), p. 30.

22. Vanessa Fuhrmans, and Dana Cimilluca, “Business Braces for Europe’s Worst—Multinationals Scramble to Protect Cash, Revise Contracts, Tighten Payment Terms,” The Wall Street Journal (June 1, 2012), p. B1.

23. Richard Wolf, Brad Heath, and Chuck Raasch, “How Health Care Law Survived, and What’s Next,” USAToday (June 29, 2012), http:// www.usatoday.com/NEWS/usaedition/2012-06-29-still2_CV_U.htm (accessed August 21, 2012).

24. Quoted in Barton et al., “Leading in the 21st Century.”

25. Quoted in Barton et al., “Leading in the 21st Century.”

26. Charles Handy, The Age of Paradox (Boston: Harvard Business School Press, 1994), pp. 146–147; and Geoff Colvin, “Leader Machines,” Fortune (October 1, 2007), pp. 98–106.

27. J. P. Donlon, “What, Put Your Customers Second? Are You Kidding?” (CEO Chronicles), Chief Executive (November–December 2010), pp. 14–16; “HCL Technologies CEO, Vineet Nayar, Gets ‘Leader in the Digital Age’ Award at CeBIT 2011,” Entertainment Close-Up (March 11, 2011); and Stephen Denning, “Masterclass: The Reinvention of Management,” Strategy & Leadership 39, no. 2 (2011), pp. 9–17.

28. Herminia Ibarra and Morten T. Hansen, “Are You a Collaborative Leader?” Harvard Business Review (July–August 2011), pp. 69–74.

29. Ibarra and Hansen, “Are You a Collaborative Leader?”; and Sally Helgesen, “Leading in 24/7: What Is Required?” Leader to Leader (Summer 2012), pp. 38–43.

30. Barton et al. “Leading in the 21st Century.”

31. See James Collins, Good to Great: Why Some Companies Make the Leap … and Others Don’t (New York: HarperCollins, 2001); Charles A. O’Reilly III and Jeffrey Pfeffer, Hidden Value: How Great Companies Achieve Extraordinary Results with Ordinary People (Boston: Harvard Business School Press, 2000); Rakesh Khurana, Searching for a Corporate Savior: The Irrational Quest for Charis- matic CEOs (Princeton, NJ: Princeton University Press, 2002); Joseph Badaracco, Leading Quietly (Boston: Harvard Business School Press, 2002); Jason Jennings, Think Big, Act Small: How America’s Best Performing Companies Keep the Startup Spirit Alive (New York: Portfolio/Penguin, 2005); Ryan Underwood, “The CEO Next Door,” Fast Company (September 2005), pp. 64–66; and Linda Tischler, “The CEO’s New Clothes,” Fast Company (September 2005), pp. 27–28.

32. David Brooks, “The Humble Hound,” The New York Times (April 10, 2010), p. A27; Charalambos A. Vlachoutsicos, “How to Cultivate Engaged Employees,” Harvard Business Review (September 2011), pp. 123–126; and Rob Nielsen, Jennifer A. Marrone, and Holly S. Slay, “A New Look at Humility: Exploring the Humility Concept and Its Role in Socialized Charismatic Leadership,” Journal of Leadership and Organizational Science 17, no. 1 (2010), pp. 33–43.

33. Jim Collins, “Level 5 Leadership: The Triumph of Humility and Fierce Resolve,” Harvard Business Review (January 2001), pp. 67–76; Collins, “Good to Great,” Fast Company (October 2001), pp. 90–104; Edward Prewitt, “The Utility of Humility,” CIO (December 1, 2002), pp. 104–110; A. J. Vogl, “Onward and Upward” (an interview with Jim Collins), Across the Board (September–October 2001), pp. 29–34; and Stefan Stern, “A New Leadership Blueprint,” Management Today (September 30, 2010), http://www.managementtoday.co.uk/features/1032244/a-new-blue- print-leaders/ (accessed March 13, 2013).

CHAPTER 1 WHAT DOES IT MEAN TO BE A LEADER? 31

34. As described in Stefan Stern, “A New Leadership Blueprint,” Management Today (October 1, 2010), p. 38.

35. Gary Yukl and Richard Lepsinger, “Why Integrating the Leading and Managing Roles Is Essential for Organizational Effectiveness,” Organizational Dynamics 34, no. 4 (2005), pp. 361–375; Henry Mintzberg, Managing (San Francisco: Berrett-Koehler, 2009); Andrew Saunders, “Rebuilding Management’s Good Name,” Management Today (May 2011), pp. 44–46; John Kotter, “Change Leadership: How Can You Accelerate Results? Leadership Excellence (January 2013), pp. 6–7; and Alan Murray, “What Is the Difference Between Management and Leadership?” The Wall Street Journal (2009), http://guides.wsj.com/management/developing-a-leadership- style/what-is-the-difference-between-management-and-leadership/ (accessed June 28, 2009).

36. This section is based on John P. Kotter, A Force for Change: How Leadership Differs from Management (New York: The Free Press, 1990), pp. 3–18; John P. Kotter, “What Leaders Really Do,” Harvard Business Review (December 2001), pp. 85–96; and ideas in Kevin Cashman, “Lead with Energy: Apply the Resilience Principle,” Leadership Excellence (December 2010), p. 7; Henry Mintzberg, M a n a g i n g ( S a n F r a n c i s c o : B e r r e t t - K o e h l e r , 2 0 0 9 ) ; a n d Mike Maddock, “The One Talent That Makes Good Leaders Great,” Forbes (September 26, 2012), http://www.forbes.com/sites/ mikemaddock/2012/09/26/the-one-talent-that-makes-good-leaders- great/ (accessed March 7, 2013).

37. Warren Bennis, Why Leaders Can’t Lead (San Francisco: Jossey Bass, 1989).

38. Abraham Zaleznik, “Managers and Leaders: Are They Different?” Harvard Business Review (March–April 1992), pp. 126–135; David Rooke and William R. Torbert, “7 Transformations of Leadership,” Harvard Business Review (April 2005), pp. 67–76; and Rooke and Torbert, Action Inquiry: The Secret of Timely and Transforming Leadership (San Francisco: Berrett-Koehler, 2004).

39. Jim Boneau and Gregg Thompson, “Leadership 4.0: It’s a Brave New Approach,” Leadership Excellence (January 2013), p. 6.

40. Based on Susan R. Komives, Nance Lucas, and Timothy R. McMahon, Exploring Leadership: For College Students Who Want to Make a Difference (San Francisco: Jossey-Bass Publishers, 1998); and Shann R. Ferch and Matthew M. Mitchell, “Intentional Forgiveness in Relational Leadership: A Technique for Enhancing Effective Leader- ship,” The Journal of Leadership Studies 7, no. 4 (2001), pp. 70–83.

41. This discussion draws ideas from Boneau and Thompson, “Leader- ship 4.0: It’s a Brave New Approach.”

42. Craig L. Pearce, “The Future of Leadership: Combining Vertical and Shared Leadership to Transform Knowledge Work,” Academy of Management Executive 18, no. 1 (2004), pp. 47–57.

43. Yi Zhang, Jean Brittain Leslie, and Kelly M. Hannum, “Trouble Ahead: Derailment Is Alive and Well,” Thunderbird International Business Review 55, no. 1 (January–February 2013), pp. 95–102.

44. See studies reported in Joyce Hogan, Robert Hogan, and Robert B. Kaiser, “Management Derailment: Personality Assessment and Mitigation,” Hogan Assessment Systems, http://www.hoganassessments.com/_ hoganweb/documents/Management_Derailment.pdf.

45. Yi Zhang et al., “Trouble Ahead: Derailment Is Alive and Well”; and Morgan W. McCall Jr. and Michael M. Lombardo, “Off the Track: Why and How Successful Executives Get Derailed” (Technical Report No. 21), (Greensboro, NC: Center for Creative Leadership, January 1983).

46. Hogan, et al., “Management Derailment: Personality Assessment and Mitigation”; George Kohlrieser, “People Mistakes: These 10 Are Very Dangerous,” Leadership Excellence (October 2012), p. 16; Clinton O. Longenecker and Laurence S. Fink, “Fixing Management’s Fatal Flaws,” Industrial Management (July–August 2012), pp. 12–17; E. Van Velsor and J. B. Leslie, “Why Executives Derail: Perspectives Across Time and Cultures,” Academy of Management Executive 9, no. 4 (1995), pp. 62–72; and McCall and Lombardo, “Off the Track: Why and How Successful Executives Get Derailed.”

47. Ram Charan and Geoffrey Colvin, “Why CEOs Fail,” Fortune (June 21, 1999), pp. 68–78.

48. This example is based on Farhad Manjoo, “The Happiness Machine: How Google Became Such a Great Place to Work,” Slate Magazine, http://www.slate.com/articles/technology/technology/2013/01/google_ people_operations_the_secrets_of_the_world_s_most_scientific_human. html (accessed March 8, 2013).

49. List of Google’s Rules from Adam Bryant, “Google’s Quest to Build a Better Boss,” The New York Times (March 12, 2011).

50. Survey by the Center for Creative Leadership, reported in Phaedra Brotherton, “Leadership: Nature or Nurture?” T+D (February 2013), p. 25.

51. Russell Palmer, “Can Leadership Be Learned?” Business Today (Fall 1989), pp. 100–102.

32 PART 1 INTRODUCTION TO LEADERSHIP

Part 2: Research Perspectives on Leadership

Chapter 2: Traits, Behaviors, and Relationships

Chapter 3: Contingency Approaches to Leadership

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Chapter 2: Traits, Behaviors, and Relationships

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YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Outline some personal traits and characteristics that are associated with effective leaders. • Identify your own traits that you can transform into strengths and bring to a leadership role. • Distinguish among various roles leaders play in organizations, including operations roles,

collaborative roles, and advisory roles, and where your strengths might best fit.

• Recognize autocratic versus democratic leadership behavior and the impact of each. • Know the distinction between people-oriented and task-oriented leadership behavior and when

each should be used.

• Understand how the theory of individualized leadership has broadened the understanding of relationships between leaders and followers.

• Describe some key characteristics of entrepreneurial leaders.

CHAPTER OUTLINE 36 The Trait Approach

41 Know Your Strengths

43 Behavior Approaches

52 Individualized Leadership

55 Entrepreneurial Traits and Behaviors

In the Lead

40 Marissa Mayer, Yahoo

42 Warren Buffett, Berkshire Hathaway

47 Col. Joe D. Dowdy and Maj. Gen. James Mattis, U.S. Marine Corps

50 Denise Morrison, Campbell Soup Company, and Michael Arrington, TechCrunch

Leader’s Self-Insight

39 Rate Your Optimism

47 What’s Your Leadership Orientation?

54 Your “LMX” Relationship

Leader’s Bookshelf

37 Take the Lead: Motivate, Inspire, and Bring Out the Best in Yourself and Everyone around You

Leadership at Work

57 Your Ideal Leader Traits

Leadership Development: Cases for Analysis

58 Consolidated Products

59 Transition to Leadership

V irginia Rometty spent 30 years climbing the ranks at IBM before becoming the company’s first female CEO in January 2012. Some of the personal characteristics that helped her get to the top include intelligence, ambition,

ability to stay focused, empathy, superb listening skills, and self-confidence. That last trait is something Rometty had to work on. She describes an experience early in her career when she was offered a big promotion. She told her boss she didn’t think she was ready and needed to think it over. Later, Rometty’s husband asked her, “Do you think a man would have ever answered that question that way?” The lesson Rometty learned, she says, was that “you have to be very confident, even though you’re so self-critical inside about what it is you may or may not know.”1

It is likely that many of Rometty’s traits are shared by other leaders who have attained higher levels in organizations. Personal traits are what captured the imagination of the earliest leadership researchers. However, look at any two successful and effective leaders and they will likely share some traits but have others that are quite dissimilar. Each individual has a unique set of qualities, characteristics, and strengths to bring to a leadership role. In addition, as the example of Virginia Rometty shows, leaders can learn to overcome some potentially limiting traits, such

35 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

as a lack of self-confidence. Consequently, many researchers have examined the behavior of leaders to determine what behavioral features comprise leadership style and how particular behaviors relate to effective leadership.

This chapter first examines the evolution of the trait approach and the importance of leaders understanding and applying their own unique leadership strengths. Then we provide an overview of the behavior approach and introduce the theory of individualized leadership, which looks at behavior between a leader and each individual follower, differentiating one-on-one behavior from leader-to-group behavior. The path illuminated by the research into leader traits and behaviors is a foundation for the field of leadership studies and still enjoys remarkable dynamism for explaining leader success or failure.

THE TRAIT APPROACH Traits are the distinguishing personal characteristics of a leader, such as intelli- gence, honesty, self-confidence, and appearance. Research early in the twentieth century examined leaders who had achieved a level of greatness and hence became known as the Great Man approach. Fundamental to this theory was the idea that some people are born with traits that make them natural leaders. The Great Man approach sought to identify the traits leaders possessed that distinguished them from people who were not leaders. Generally, research found only a weak rela- tionship between personal traits and leader success.2 Indeed, the diversity of traits that effective leaders possess indicates that leadership ability is not a genetic endowment.

Nevertheless, with the advancement of the field of psychology during the 1940s and 1950s, trait approach researchers expanded their examination of personal attri- butes by using aptitude and psychological tests. These early studies looked at per- sonality traits such as creativity and self-confidence, physical traits such as age and energy level, abilities such as knowledge and fluency of speech, social characteristics such as popularity and sociability, and work-related characteristics such as the desire to excel and persistence against obstacles.3

In a 1948 literature review,4 Stogdill examined more than 100 studies based on the trait approach. He uncovered several traits that appeared consistent with effective leadership, including general intelligence, initiative, interpersonal skills, self-confidence, drive for responsibility, and personal integrity. Stogdill’s findings also indicated, however, that the importance of a particular trait was often relative to the situation. Initiative, for example, may contribute to the success of a leader in an entrepreneurial situation, but it may be irrelevant to a leader in a stable bureaucracy. Thus, possessing certain personal characteristics is no guarantee of success.

Many researchers discontinued their efforts to identify leadership traits in light of Stogdill’s 1948 findings and turned their attention to examining leader behavior and leadership situations. However, others continued with expanded trait lists and research projects. Stogdill’s subsequent review of 163 trait studies conducted between 1948 and 1970 concluded that some personal traits do indeed seem to contribute to effective leadership.5 The study identified many of the same traits found in the 1948 survey, along with several additional characteristics, including aggressiveness, independence, and tolerance for stress. However, Stogdill again cautioned that the value of a particular trait or set of traits varies with the organizational situation.

36 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Traits the distinguishing personal characteristics of a leader, such as intelligence, honesty, self-confidence, and appearance

Great Man approach a leadership perspective that sought to identify the inherited traits leaders possessed that distinguished them from people who were not leaders

In recent years, there has been a resurgence of interest in examining leadership traits. A review by Kirkpatrick and Locke identified a number of personal traits that distinguish leaders from nonleaders, including some pinpointed by Stogdill.6

Other studies have focused on followers’ perceptions and indicate that certain traits are associated with people’s perceptions of who is a leader. For example, one study found that the traits of intelligence, masculinity, and dominance were strongly related to how individuals perceived leaders.7 Others have found that charismatic CEOs are perceived to be more effective than other leaders, even though there is no evidence showing they actually are.8

In summary, trait research has been an important part of leadership studies throughout the twentieth century and continues into the twenty-first, as illustrated by this chapter’s Leader’s Bookshelf, which takes a fresh look at some characteris- tics that enable leaders to motivate and inspire people in today’s environment. Optimism and a cheerful attitude have recently gained attention as important traits

LEADER’S BOOKSHELF Take the Lead: Motivate, Inspire, and Bring Out the Best in Yourself and Everyone around You

by Betsy Myers

All of us know that some leaders inspire and motivate us whereas others drain our energy and weigh down our spirit. In her first book, Take the Lead, Betsy Myers, senior advisor to Presidents Barack Obama and Bill Clinton and former executive director of the Harvard Center for Public Leadership, explains the char- acteristics that will make you a moti- vating and inspirational leader.

IT’S NOT MAGIC The two presidents Myers has worked with are known for their charisma, but Myers insists there’s no magic to being able to fully engage others. Good leader- ship, she says, is about how you treat and connect with others. Take the Lead describes seven characteristics that good leaders share: authenticity, connection, respect, clarity, collaboration, learning, and courage. Let’s look closely at three of these leader qualities:

• They are authentic. People are nat- urally drawn to leaders who have an honest self-awareness and are comfortable with who they are. These leaders don’t have to puff themselves up or put others down. They love what they do

and they pass that energy on to others. Myers tells the story of a woman she worked with who wasn’t succeeding in her leader- ship role. Myers discovered that she really wanted to be teaching music but didn’t consider it a real- istic goal. The two worked out a plan for the future that enabled the woman to explore careers in music while she kept her job. Within a few years, she was head of the music history department at a university and was flourishing.

• They lead by listening with respect. Hsi-Wei Chou, the governor of Taipei County, Taiwan, once saw his security guards struggling to control a man who was waving a piece of paper in the air and demanding to speak to the gover- nor. Chou asked the guards to allow them to talk, and he quickly defused the situation. “It’s about treating people with respect,” Chou said. “Whether the man is right or wrong…, he deserves the respect of his government and his governor.”

• They have a passion for learning and share it with others. Captain

Chesley “Sully” Sullenberger says he knew he wanted to be a pilot at the age of five, and he spent the rest of his life in the pursuit of excellence in his chosen field. After 40 years of pursuing excel- lence, there couldn’t have been anyone better prepared to be in control when U.S. Airways Flight 1549 had to be landed on the Hudson River in January 2009. Sul- lenberger’s passion for learning also meant he was a proponent of continuous training for every member of a flight crew.

PRACTICAL ADVICE FOR NEW LEADERS Take the Lead doesn’t claim to have a “secret sauce” for leadership, but it does describe qualities that anyone can develop to be a better leader. “Genuine leadership is not something that magi- cally happens because we’ve been handed a certain position or role to play. It is a quality we nurture in our- selves, regardless of our job or station in life.”

Source: Based on Take the Lead, by Betsy Myers, is published by Atria Books.

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37 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

for successful leaders. Britain’s Royal Navy takes cheerfulness so seriously that it tracks how leader cheerfulness affects morale and effectiveness.9 As discussed in Chapter 1, humility, including a willingness to admit mistakes and make oneself vulnerable, has emerged as an important trait in today’s collaborative world.10

Exhibit 2.1 presents some of the traits and their respective categories that have been identified through trait research over the years. Many researchers still contend that some traits are essential to effective leadership, but only in combination with other factors.11 A few traits typically considered highly important for leadership are optimism, self-confidence, honesty and integrity, and drive.

Optimism and Self-Confidence Recent research points to a positive outlook and a cheerful attitude as keys to effective leadership.12 Optimism refers to a tendency to see the positive side of things and expect that things will turn out well. Numerous surveys indicate that optimism is the single characteristic most common to top executives. People rise to the top because they have the ability to see opportunities where others see problems and can instill in others a sense of hope for the future. Leaders at all levels need some degree of optimism to see possibilities even through the thickest fog and rally people around a vision for a better tomorrow. Although hundreds of experiments support the notion that people possess ingrained tenden- cies toward either optimism or pessimism, leaders can train themselves to deliber- ately focus on the positive rather than the negative and interpret situations in more positive, optimistic ways.13

A related characteristic is having a positive attitude about oneself. Leaders who know themselves develop self-confidence, which is general assurance in one’s own judg- ments, decision making, ideas, and capabilities. Self-confidence doesn’t mean being arrogant and prideful but rather knowing and trusting in oneself. Self-confidence is

Evaluate your degree of self- confidence by completing the CengageNOW questionnaire “How Self-Confi- dent Are You?”

What I’ve re- ally learned over time is that op- timism is a very, very important part of leader- ship…. People

don’t like to fol- low pessimists.

Robert Iger, Chairman and CEO of The Walt Disney

Company

EXHIBIT 2.1 Some Leader Characteristics

Personal Characteristics Energy Passion Humility Physical stamina Intelligence and Ability Intelligence, cognitive ability Knowledge Judgment, decisiveness Personality Optimism Cheerfulness Self-confidence Honesty and integrity Charisma Desire to lead Independence

Social Characteristics Sociability, interpersonal skills Cooperativeness Ability to enlist cooperation Tact, diplomacy Work-Related Characteristics Drive, desire to excel Dependability Fair-mindedness Perseverance, tenacity Social Background Education Mobility

Sources: Bass and Stogdill’s Handbook of Leadership: Theory, Research, and Management Applications, 3rd ed. (New York: The Free Press, 1990), pp. 80–81; S. A. Kirkpatrick and E. A. Locke, “Leadership: Do Traits Matter?” Academy of Management Executive 5, no. 2 (1991), pp. 48–60; and James M. Kouzes and Barry Z. Posner, The Leadership Challenge: How to Get Extraordinary Things Done in Organizations (San Francisco: Jossey-Bass, 1990).

38 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Optimism a tendency to see the positive side of things and expect that things will turn out well

Self-confidence assurance in one’s own judgments, decision making, ideas, and capabilities

related to self-efficacy, which refers to a person’s strong belief that he or she can suc- cessfully accomplish a specific task or outcome.14 A leader who has a positive self- image and displays certainty about his or her own ability to achieve an outcome fosters confidence among followers, gains respect and admiration, and creates motivation and commitment among followers for the mission at hand.

Active leaders need self-confidence and optimism. How many of us willingly fol- low someone who is jaded and pessimistic, or someone who obviously doesn’t believe in himself or herself? Leaders initiate change, and they often must make decisions with- out adequate information. Without the confidence to move forward and believe things will be okay, even if an occasional decision is wrong, leaders could be paralyzed into inaction. Setbacks have to be overcome. Risks have to be taken. Competing points of view have to be managed, with some people left unsatisfied. The characteristics of opti- mism and self-confidence enable a leader to face all these challenges.15

Honesty and Integrity Positive attitudes have to be tempered by strong ethics or leaders can get into trouble. Consider Bernard Madoff, who masterminded the larg- est financial fraud in history and was sent to jail on 11 criminal charges, including securities fraud and perjury. As a leader, Madoff displayed strong self-confidence and optimism, which is one reason he was able to attract so many investors. The problem was that he didn’t have a strong ethical grounding to match. Due to Madoff’s scam, thousands of people were swindled out of their life’s savings, chari- ties and foundations were ruined, and pension funds were wiped out, while Madoff and his wife lived in luxury.16

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 2.1

Rate Your Optimism

Instructions: This questionnaire is designed to assess your level of optimism as reflected in your hopefulness about the future. There are no right or wrong answers. Please indicate your personal feelings about whether each statement is Mostly False or Mostly True by checking the answer that best describes your attitude or feeling.

Mostly False

Mostly True

1. I nearly always expect a lot from life.

2. I try to anticipate when things will go wrong.

3. I always see the positive side of things.

4. I often start out expecting the worst, although things usually work out okay.

5. I expect more good things to happen to me than bad.

6. I often feel concern about how things will turn out for me.

7. If something can go wrong for me, it usually does.

8. Even in difficult times, I usually expect the best.

9. I am cheerful and positive most of the time. I consider myself an optimistic person.

Scoring and Interpretation Give yourself one point for checking Mostly True for items 1, 3, 5, 8, 9, 10. Also give yourself one point for checking Mostly False for items 2, 4, 6, 7. Enter your score here: . If your score is 8 or higher, it may mean that you are high on optimism. If your score is 3 or less, your view about the future may be pessimistic. For the most part, peo- ple like to follow a leader who is optimistic rather than nega- tive about the future. However, too much optimism may exaggerate positive expectations that are never fulfilled. If your score is low, what can you do to view the world through a more optimistic lens?

Source: These questions were created based on several sources.

| D re am

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NEW LEADER ACTION MEMO People generally prefer to fol- low leaders who are optimistic rather than pessimistic about the future. Complete the questionnaire in Leader’s Self-Insight 2.1 to assess your level of optimism.

39 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Effective leaders are ethical leaders. One aspect of being an ethical leader is being honest with followers, customers, shareholders, and the public, and maintain- ing one’s integrity. Honesty refers to truthfulness and nondeception. It implies an openness that followers welcome. Integrity means that a leader’s character is whole, integrated, and grounded in solid ethical principles, and he or she acts in keeping with those principles. Leaders who model their ethical convictions through their daily actions command admiration, respect, and loyalty. Honesty and integrity are the foundation of trust between leaders and followers.

Sadly, trust is sorely lacking in many organizations following years of corporate scandals and rampant greed. Leaders need the traits of honesty and integrity to rebuild trusting and productive relationships. People today are wary of authority and the deceptive use of power, and they are hungry for leaders who hold high moral stan- dards. Successful leaders have also been found to be highly consistent, doing exactly what they say they will do when they say they will do it. Successful leaders prove themselves trustworthy. They adhere to basic ethical principles and consistently apply them in their leadership. One survey of 1,500 managers asked the values most desired in leaders. Honesty and integrity topped the list. The authors concluded:

Honesty is absolutely essential to leadership. After all, if we are willing to fol- low someone, whether it be into battle or into the boardroom, we first want to assure ourselves that the person is worthy of our trust. We want to know that he or she is being truthful, ethical, and principled. We want to be fully confi- dent in the integrity of our leaders.17

Drive Another characteristic considered essential for effective leadership is drive. Leaders often are responsible for initiating new projects as well as guiding projects to successful completion. Drive refers to high motivation that creates a high effort level by a leader. Leaders with drive seek achievement, have energy and tenacity, and are frequently perceived as ambitious. If people don’t strive to achieve something, they rarely do. Ambition can enable leaders to set challenging goals and take initiative to reach them.18

A strong drive is also associated with high energy. Leaders work long hours over many years. They have stamina and are vigorous and full of life in order to handle the pace, the demands, and the challenges of leadership. During her first two years at Google, Marissa Mayer says she worked 100 hours a week. That pace is likely to be required in her new job as president and CEO of Yahoo.

IN THE LEAD Marissa Mayer, Yahoo Marissa Mayer has set herself some tough goals as the new president and CEO of Yahoo. But tough is part of Mayer’s DNA. Mayer is known for being incredibly energetic and ambitious. She loves hard work and challenge. “She doesn’t need any sleep,” said Craig Silverstein, who worked with her at Google and now develops software for Kahn Academy. That’s clearly an overstatement, but Mayer has demonstrated that she has almost superhuman stamina and a strong drive to succeed. In the early years at Google, she routinely worked 100-hour weeks and occasionally pulled all-nighters. Soon after joining Yahoo as CEO, Mayer had her first baby and returned to work two weeks after the delivery.

NEW LEADER ACTION MEMO

As a leader, you can develop the personal traits of self- confidence, integrity, and drive, which are important for suc- cessful leadership in every organization and situation. You can work to keep an optimistic attitude and be ethical in your decisions and actions.

Honesty truthfulness and nondeception

Integrity the quality of being whole, integrated, and acting in accordance with solid ethical principles

Drive high motivation that creates a high effort level by a leader

40 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Even in high school, Mayer was known as an overachiever who refused to settle for less than the best from herself or others. As captain of the pom-pom squad, she scheduled practices that lasted for hours to make sure everyone was synchronized. It was during her first management job at Google that she incorporated the idea of pushing beyond her comfort zone into her career philosophy. She isn’t afraid to take risks in the interest of help- ing the team and organization succeed. Mayer created a firestorm of criticism when she issued a policy early in her tenure at Yahoo that employees can no longer work from home, but she stuck by her decision without regrets or apologies. She believes Yahoo is in a crisis situation and to succeed needs the creative energy that comes from people working face to face and side by side. Some people believe she will eventually relax the tough “all hands in the office” policy, since flexibility is another of her characteristics. However, she won’t relax her high standards or the requirement that employees be as dedicated to Yahoo’s success as she is.19

Working 100-hour weeks certainly isn’t necessary for effective leadership, but all leaders have to display drive and energy to be successful. Clearly, various traits such as drive, self-confidence, optimism, and honesty have great value for leaders. One study of 600 executives by Hay Group, a global organizational and human resources consulting firm, found that 75 percent of the successful executives studied possessed the characteristics of self-confidence and drive.20

In Chapter 4, we will further consider individual characteristics and qualities that play a role in leadership effectiveness. However, good leaders know it isn’t about identifying specific individual traits but rather understanding one’s own unique set of strengths and capabilities and learning how to make the most of them.21

KNOW YOUR STRENGTHS Some people tend to think a leader should have a complete set of skills, character- istics, and abilities to handle any problem, challenge, or opportunity that comes along. This myth of the “complete leader” can cause stress and frustration for lea- ders and followers, as well as damage to the organization.22 Interdependence is the key to effective leadership. Sixty percent of leaders in one survey acknowledge that leaders face challenges that go beyond any individual’s capabilities.23 Therefore, the best leaders recognize and hone their strengths while trusting and collaborating with others to make up for their weak points.

Everyone has strengths, but many leaders fail to recognize and apply them, often because they are hampered by the idea that they should be good at every- thing. Benjamin Franklin referred to wasted strengths as “sundials in the shade.”24

Only when leaders understand their strengths can they use these abilities effectively to make their best contribution.

What Are Strengths? A strength arises from a natural talent that has been supported and reinforced with knowledge and skills.25 Talents can be thought of as innate traits and naturally recurring patterns of thought, feeling, and behavior. One person might be naturally outgoing and curious, for example; another might have a natural talent for being organized. Once recognized, talents can be turned into strengths by consciously

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 41

Strength a natural talent or ability that has been supported and reinforced with learned knowledge and skills

developing and enhancing them with learning and practice. Unless they are honed and strengthened and put to use, talents are merely aspects of one’s potential.

One neat thing about understanding your strengths is the philosophy “concentrate on your strengths, not your weaknesses.” You excel in life by maximizing your strengths, not by fixing your weaknesses. When you live and work from your strengths, you are more motivated, competent, and satisfied. Strengths are important because you can focus your life around them, and your energy, enthusiasm, and effectiveness can be the basis of your leadership. Why devote your energy trying to fix your weaknesses or expending much thought and effort performing tasks that don’t match your strengths? When people use their talents and strengths, they feel good and enjoy their work with- out extra effort; hence they are effective and make a positive contribution.

How does a leader know which traits or behavior patterns can be turned into strengths? Warren Buffett recommends that people do what fits their natural inter- ests and abilities, which is reflected in the work they like to do.

IN THE LEAD Warren Buffett, Berkshire Hathaway Warren Buffett says he finds investing so much fun that he would do it for free. Buffett tried other work early in his career but found it so unsatisfying that he knew he wouldn’t want to do it for any amount of money. The legendary self-made billionaire and chairman of Berkshire Hathaway was the fourth richest person in the world in 2013. Yet it isn’t the money that drives him, but the love of the work.

Each year, Buffett hosts in his hometown of Omaha, Nebraska, about 160 business stu- dents from universities around the world. One question he usually gets is about how to know what career to pursue. How did the great man know that investing was the right career for him? Buffett answers in two parts. First, he says his “natural wiring” was made for capital allocation—that is, he just had a knack for knowing how to allocate financial resources into companies or other entities as a way to generate wealth. Buffett says that if he had been born in a country such as Sudan or Cambodia, without abundant private capi- tal and a system of capital allocation, he would never have gotten to use his natural talents. Nor would he have succeeded in a different era when there was no capitalism. Buffett is very clear in recommending that people need to do what fits their natural mental makeup.

How did he know that his wiring fit investing? The key was his love for it. His career advice is to find work or a career that you really enjoy, and it will fit the natural strengths of your mental wiring.26

Matching Strengths with Roles Recent research suggests that different leader strengths might be better suited to dif- ferent types of leadership roles.27 Exhibit 2.2 illustrates three types of leadership roles identified in today’s organizations by a team of experts at Hay Group. The researchers found that, although there is a core set of competencies that all leaders need, there is significant variation in the personal characteristics, behaviors, and skills that correlate with success in the different roles.

The operational role is the closest to a traditional, vertically oriented management role, where an executive has direct control over people and resources to accomplish results. Operational leaders fill traditional line and general management positions in a

42 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Operational role a vertically oriented leader- ship role in which an exec- utive has direct control over people and resources and the position power to accomplish results

business, for example. They set goals, establish plans, and get things done primarily through the vertical hierarchy and the use of position power. Operational leaders are doggedly focused on delivering results. They need high self-confidence and tend to be assertive, always pushing forward and raising the bar. Successful operational leaders are typically analytical and knowledgeable, yet they also have the ability to translate their knowledge into a vision that others can become passionate about.

The collaborative role is a horizontal role and includes people such as project man- agers, matrix managers, and team leaders in today’s more horizontally organized com- panies. This role, which has grown tremendously in importance in recent years, is quite challenging. Leaders in collaborative roles typically don’t have the strong position power of the operational role. They often work behind the scenes, using their personal power to influence others and get things done. Collaborative leaders need excellent people skills in order to network, build relationships, and obtain agreement through personal influence. They also are highly proactive and tenacious, and they exhibit extreme flexibility to cope with the ambiguity and uncertainty associated with the collaborative role.

Leaders in an advisory role provide guidance and support to other people and departments in the organization. Advisory leadership roles are found, for example, in departments such as legal, finance, and human resources. These leaders are responsible for developing broad organizational capabilities rather than accom- plishing specific business results. Advisory leaders need great people skills and the ability to influence others through communication, knowledge, and personal per- suasion. In addition, leaders in advisory roles need exceptionally high levels of hon- esty and integrity to build trust and keep the organization on solid ethical ground.

The Hay Group research findings shed new light on the types of roles leaders fill in today’s organizations and emphasize that an individual’s strengths can influ- ence how effective a leader might be in a particular role. Leadership success partly depends on matching leaders with roles where their strengths can be most effective.

BEHAVIOR APPROACHES As suggested in the previous discussion, strengths are not just personal traits but also patterns of behavior. Rather than looking at an individual’s personal traits, diverse research programs on leadership behavior have sought to uncover the

EXHIBIT 2.2 Three Types of Leadership Roles

NEW LEADER ACTION MEMO

As a leader, you can understand the type of leadership role in which your strengths would be most effec- tive and satisfying. You can pursue an operational, collabo- rative, or advisory leadership role depending on your natural tendencies.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 43

Collaborative role a horizontal leadership role in which the leader often works behind the scenes and uses personal power to in- fluence others and get things done

Advisory role a leadership role that pro- vides advice, guidance, and support to other people and departments in the organization

behaviors that effective leaders engage in. Behaviors can be learned more readily than traits, enabling leadership to be accessible to all.

Autocratic versus Democratic Behaviors One study that served as a precursor to the behavior approach recognized auto- cratic and democratic leadership styles. An autocratic leader is one who tends to centralize authority and derive power from position, control of rewards, and coer- cion. A democratic leader delegates authority to others, encourages participation, relies on subordinates’ knowledge for completion of tasks, and depends on subordi- nate respect for influence.

The first studies on these leadership behaviors were conducted at the University of Iowa by Kurt Lewin and his associates.28 The research included groups of chil- dren, each with its own designated adult leader who was instructed to act in either an autocratic or democratic style. These experiments produced some interesting findings. The groups with autocratic leaders performed highly so long as the leader was present to supervise them. However, group members were displeased with the close, autocratic style of leadership, and feelings of hostility frequently arose. The performance of groups who were assigned democratic leaders was almost as good, and these groups were characterized by positive feelings rather than hostility. In addition, under the democratic style of leadership, group members performed well even when the leader was absent. The participative techniques and majority-rule decision making used by the democratic leader trained and involved the group members so that they performed well with or without the leader present. These characteristics of democratic leadership may partly explain why the empowerment of employees is a popular trend in companies today. This chapter’s Consider This box presents the notion that democratic leaders may get better results because they allow followers to feel their own power and worth.

Consider Minimal Leadership

When the Master governs, the people are hardly aware that he [she] exists.

Next best is a leader who is loved.

Next, one who is feared.

The worst is one who is despised.

If you don’t trust the people, you make them untrustworthy.

The Master doesn’t talk, he [she] acts.

When his [her] work is done, the people say, “Amazing: we did it all by ourselves.”

Source: From Tao Te Ching, translated by S. Mitchell, (New York: Harper Perennial, 1988), p. 17.

Autocratic a leader who tends to cen- tralize authority and derive power from position, control of rewards, and coercion

Democratic a leader who delegates au- thority to others, encourages participation, relies on sub- ordinates’ knowledge for completion of tasks, and depends on subordinate respect for influence

44 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

This early work implied that leaders were either autocratic or democratic in their approach. However, further work by Tannenbaum and Schmidt indicated that leadership behavior could exist on a continuum reflecting different amounts of employee participation.29 Thus, one leader might be autocratic (boss-centered), another democratic (subordinate-centered), and a third a mix of the two styles. Exhibit 2.3 illustrates the leadership continuum.

Tannenbaum and Schmidt also suggested that the extent to which leaders should be boss-centered or subordinate-centered depended on organizational cir- cumstances and that leaders might adjust their behaviors to fit the circumstances. For example, if there is time pressure on a leader, or if it takes too long for subor- dinates to learn how to make decisions, the leader will tend to use an autocratic style. When subordinates are able to learn decision-making skills readily, a demo- cratic style can be used. Also, the greater the skill difference, the more autocratic the leader approach because it is difficult to bring subordinates up to the leader’s expertise level.30

Jack Hartnett, president of D. L. Rogers Corporation and franchise owner of 54 Sonic drive-in restaurants, provides an example of the autocratic leadership style. He tells workers to “do it the way we tell you to do it,” rather than asking for their input or suggestions.31 The style works well in the fast-food restaurant business where turnover is typically high and many employees are young and low skilled. In contrast, Stephen McDonnell, CEO of Applegate Farms, is an extreme exam- ple of a democratic leader. For most of Applegate Farms’ history, McDonnell hasn’t even been in the office. From his experience at other companies, McDonnell had observed that most organizational problems were more easily diagnosed, and more effectively solved, within specific teams or work groups rather than by top managers.

EXHIBIT 2.3 Leadership Continuum

Source: Harvard Business Review. An exhibit from Robert Tannenbaum and Warren Schmidt, “How to Choose a Leadership Pattern” (May–June 1973). Copyright 1973 by the president and Fellows of Harvard College.

NEW LEADER ACTION MEMO As a leader, you can use a democratic leadership style to help followers develop decision-making skills and perform well without close supervision. An autocratic style might be appropriate when there is time pressure or fol- lowers have low skill levels.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 45

He decided that the best way to get a company running smoothly was to give everyone access to relevant information, empower them with the freedom and responsibility to act on it, and then stay out of the way.32

The findings about autocratic and democratic leadership in the original Univer- sity of Iowa studies indicated that leadership behavior had a definite effect on out- comes such as follower performance and satisfaction. Equally important was the recognition that effective leadership was reflected in behavior, not simply by what personality traits a leader possessed. Interestingly, Stephen McDonnell, CEO of Applegate, is a self-confessed control-freak boss, full of anxiety and obsessed with meeting goals. He realized that working mostly from home was the best way to protect the company from his tendency to micromanage. This suggests that leaders can adopt behaviors that are almost in direct opposition to their natural traits when it is necessary.

Ohio State Studies The idea that leadership is reflected in behavior and not just personal traits provided a focus for subsequent research. One early series of studies on leadership behavior was conducted at The Ohio State University. Researchers conducted surveys to identify specific dimensions of leader behavior. Narrowing a list of nearly 2,000 leader behaviors into a questionnaire containing 150 examples of definitive leader behaviors, they developed the Leader Behavior Description Questionnaire (LBDQ) and administered it to employees.33 Hundreds of employees responded to various examples according to the degree to which their leaders engaged in the behaviors. The analysis of ratings resulted in two wide-ranging categories of leader behavior, later called consideration and initiating structure.

Consideration describes the extent to which a leader cares about subordinates, respects their ideas and feelings, and establishes mutual trust. Showing appreciation, listening carefully to problems, and seeking input from sub- ordinates regarding important decisions are all examples of consideration behaviors.

Initiating structure describes the extent to which a leader is task oriented and directs subordinates’ work activities toward goal achievement. This type of leader behavior includes directing tasks, getting people to work hard, planning, providing explicit schedules for work activities, and ruling with an iron hand.

Although many leaders fall along a continuum that includes both consider- ation and initiating structure behaviors, these behavior categories are independent of one another. In other words, a leader can display a high degree of both behav- ior types or a low degree of both behavior types. Additionally, a leader might demonstrate high consideration and low initiating structure, or low consideration and high initiating structure behavior. Research indicates that all four of these leader style combinations can be effective.34 The following examples describe two U.S. Marine leaders who display different types of leadership behavior that corre- late to the consideration and initiating structure styles. Sometimes these styles clash.

NEW LEADER ACTION MEMO

Discover your leader- ship orientation related to consider- ation and initiating structure by completing the self-assessment exercise in Leader’s Self-Insight 2.2.

Consideration the extent to which a leader is sensitive to subordinates, respects their ideas and feelings, and establishes mutual trust

Initiating structure the extent to which a leader is task oriented and directs subordinates’ work activities toward goal achievement

46 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

IN THE LEAD Col. Joe D. Dowdy and Maj. Gen. James Mattis, U.S. Marine Corps Only a few weeks into the war in Iraq, Marine Col. Joe D. Dowdy had both accomplished a gru- eling military mission and been removed from his command by Maj. Gen. James Mattis. The complicated and conflicting tales of why Col. Dowdy was dismissed are beyond the scope of this text, but one issue that came under examination was the differing styles of Col. Dowdy and Gen. Mattis, as well as the difficult, age-old wartime tension of “men versus mission.”

Gen. Mattis has been referred to as a “warrior monk,” consumed with the study of bat- tle tactics and a leader whose own battle plans in Iraq were considered brilliant. Gen. Mattis saw speed as integral to success in the early days of the Iraqi war, pushing for regiments to move quickly to accomplish a mission despite significant risks. For Col. Dowdy, some risks seemed too high, and he made decisions that delayed his mission but better protected his marines. Col. Dowdy was beloved by his followers because he was deeply concerned about their welfare, paid attention to them as individuals, and treated them as equals, going so far as to decline certain privileges that were available only to officers.

Despite their different styles, both leaders were highly respected by followers. When asked about Gen. Mattis, Gunnery Sgt. Robert Kane, who has served under both leaders, says he would certainly “follow him again.” However, when he learned that Col. Dowdy had been dismissed, Sgt. Kane says he “wanted to go with him. If [he] had said ‘Get your gear, you’re coming with me,’ I would’ve gone, even if it meant the end of my career.”35

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 2.2

What’s Your Leadership Orientation?

Instructions: The following questions ask about your per- sonal leadership orientation. Each item describes a specific kind of behavior but does not ask you to judge whether the behavior is desirable or undesirable.

Read each item carefully. Think about how frequently you engage in the behavior described by the item in a work or school group. Please indicate whether each state- ment is Mostly False or Mostly True by checking the answer that best describes your behavior.

Mostly False

Mostly True

1. I put into operation sugges- tions agreed to by the group.

2. I treat everyone in the group with respect as my equal.

3. I back up what other people in the group do.

4. I help others with their personal problems.

5. I bring up how much work should be accomplished.

6. I help assign people to specific tasks.

7. I frequently suggest ways to fix problems.

8. I emphasize deadlines and how to meet them.

Scoring and Interpretation Consideration behavior score—count the number of checks for Mostly True for items 1–4. Enter your consideration score here: .

A higher score (3 or 4) suggests a relatively strong orien- tation toward consideration behavior by you as a leader. A low score (2 or less) suggests a relatively weak consideration orientation.

Initiating structure behavior score—count the number of checks for Mostly True for items 5–8. Enter your initiating structure score here: .

A higher score (3 or 4) suggests a relatively strong orien- tation toward initiating structure behavior by you as a leader. A low score (2 or less) suggests a relatively weak ori- entation toward initiating structure behavior.

Source: Sample items adapted from: Edwin A Fleishman’s Leadership Opinion Questionnaire. (Copyright 1960, Science Research Associates, Inc., Chicago, IL.) This version is based on Jon L. Pierce and John W. Newstrom, Leaders and the Leadership Process: Readings, Self-Assessments & Applications, 2nd ed. (Boston: Irwin McGraw-Hill, 2000).

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47 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Gen. Mattis might be considered highly task oriented, reflecting an initiating structure approach, while Col. Dowdy seems more people oriented, reflecting a consideration behavioral style. Whereas Gen. Mattis typically put the mission first, combined with a concern for the marines under his command, Col. Dowdy typically put marines first, even though he also gave his all to accomplish the mission.

Additional studies that correlated these two leader behavior types and impact on subordinates initially demonstrated that “considerate” supervisors had a more positive impact on subordinate satisfaction than did “structuring” supervisors.36

For example, when leader effectiveness was defined by voluntary turnover or amount of grievances filed by subordinates, considerate leaders generated less turn- over and grievances. But research that utilized performance criteria, such as group output and productivity, showed initiating structure behavior was rated more effec- tive. Other studies involving aircraft commanders and university department heads revealed that leaders rated effective by subordinates exhibited a high level of both consideration and initiating structure behaviors, whereas leaders rated less effective displayed low levels of both behavior styles.37

University of Michigan Studies Studies at the University of Michigan took a different approach by directly compar- ing the behavior of effective and ineffective supervisors.38 The effectiveness of leaders was determined by productivity of the subordinate group. Initial field stud- ies and interviews at various job sites gave way to a questionnaire not unlike the LBDQ, called the Survey of Organizations.39

Over time, the Michigan researchers established two types of leadership behav- ior, each type consisting of two dimensions.40 First, employee-centered leaders display a focus on the human needs of their subordinates. Leader support and interaction facilitation are the two underlying dimensions of employee-centered behavior. This means that in addition to demonstrating support for their subordinates, employee- centered leaders facilitate positive interaction among followers and seek to minimize conflict. The employee-centered style of leadership roughly corresponds to the Ohio State concept of consideration.

In contrast to the employee-centered leader, the job-centered leader directs activities toward scheduling, accomplishing tasks, and achieving efficiency. Goal emphasis and work facilitation are dimensions of this leadership behavior. By focusing on reaching task goals and facilitating the structure of tasks, job-centered behavior approximates that of initiating structure.

However, unlike the consideration and initiating structure styles defined by the Ohio State studies, Michigan researchers considered employee-centered leadership and job-centered leadership to be distinct styles in opposition to one another. A leader is identifiable by behavior characteristic of one or the other style but not both. Another hallmark of later Michigan studies is the acknowledgment that often the behaviors of goal emphasis, work facilitation, support, and interaction facilita- tion can be meaningfully performed by a subordinate’s peers rather than only by the designated leader. Other people in the group could supply these behaviors, which enhanced performance.41

In addition, while leadership behavior was demonstrated to affect the perfor- mance and satisfaction of subordinates, performance was also influenced by other

Employee-centered a leadership behavior that displays a focus on the human needs of subordinates

Job-centered leadership behavior in which leaders direct activities to- ward efficiency, cost-cutting, and scheduling, with an emphasis on goals and work facilitation

48 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

factors related to the situation within which leaders and subordinates worked. The importance of situation will be explored in the next chapter.

The Leadership Grid Blake and Mouton of the University of Texas proposed a two-dimensional leader- ship theory called the Leadership Grid that builds on the work of the Ohio State and Michigan studies.42 Based on a week-long seminar, researchers rated leaders on a scale of one to nine according to two criteria: the concern for people and the con- cern for production. The scores for these criteria are plotted on a grid with an axis corresponding to each concern. Exhibit 2.4 depicts the two-dimensional model and five of the seven major leadership styles.

Team management (9,9) is often considered the most effective style and is recommended because organization members work together to accomplish tasks. Country club management (1,9) occurs when primary emphasis is given to people rather than to work outputs. Authority-compliance management (9,1) occurs when efficiency in operations is the dominant orientation. Middle-of-the-road manage- ment (5,5) reflects a moderate amount of concern for both people and production. Impoverished management (1,1) means the absence of a leadership philosophy;

EXHIBIT 2.4 The Leadership Grid® Figure

Source: The Leadership Grid figure from Leadership Dilemma—Grid Solutions by Robert R. Blake and Anne Adams McCanse (for- merly the Managerial Grid by Robert R. Blake and Jane S. Mouton). Houston: Gulf Publishing Company, p. 29. Copyright 1991 by Scientific Methods, Inc. Reproduced by permission of the owners.

The Leadership Grid a two-dimensional leader- ship model that describes major leadership styles based on measuring both concern for people and concern for production

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 49

leaders exert little effort toward interpersonal relationships or work accomplishment. Consider these examples:

IN THE LEAD Denise Morrison, Campbell Soup Company, and Michael Arrington, TechCrunch Douglas Conant, former CEO of Campbell Soup Company, met Denise Morrison in 1995 when he was CEO of Nabisco and she cold-called him looking for a job. He found in Morrison a kindred spirit in terms of leadership style and hired her; she later followed him to Campbell in 2003—and into the company’s top executive seat eight years later. Like Conant, Morrison is a strong proponent of empowerment and employee engagement. She has been referred to as “tough on the issues but tender on people.” Morrison is known to be patient and supportive, even though she can make difficult operational decisions without letting her emotions cloud her judgment.

Compare Morrison’s approach to that of Michael Arrington, founder of TechCrunch, the company that publishes the influential blog of the same name. Arrington started the blog because he enjoys the research and writing, and he admits he isn’t very good at the “peo- ple management” part of his job. “It’s hard to be a coach and a player at the same time,” Arrington says. “Plus, I’m moody.” Arrington says his style is to bust down doors and clean up the mess later. Recognizing his weak point in being a manager of people, Arrington hired Heather Harde as CEO of the company, which enabled TechCrunch to grow and allowed Arrington to focus on what he was best at doing. Both Arrington and Harde have since left the company after public clashes with Arianna Huffington of The Huffington Post.43

The leadership of Denise Morrison is characterized by high concern for people and moderate concern for tasks and production. Michael Arrington, in contrast, is very high on concern for production and relatively low on concern for people. In each case, both concerns shown in The Leadership Grid are present, but they are integrated in different amounts.

Theories of a “High-High” Leader The leadership styles described by the researchers at Ohio State, University of Michi- gan, and University of Texas pertain to variables that roughly correspond to one another: consideration and initiating structure; employee-centered and job-centered; concern for people and concern for production. The research into the behavior approach culminated in two predominate types of leadership behaviors—people- oriented and task-oriented. Exhibit 2.5 illustrates how the various studies fall within these two behavior categories and lists some behaviors that are representative of each type of leadership.

The findings about two underlying dimensions and the possibility of leaders rated high on both dimensions raise three questions to think about. The first question is whether these two dimensions are the most important behaviors of leadership. Cer- tainly, these two behaviors are important. They capture fundamental, underlying aspects of human behavior that must be considered for organizations to succeed. One reason why these two dimensions are compelling is that the findings are based on empirical research, which means that researchers went into the field to study real leaders across a variety of settings. When independent streams of field research reach similar conclusions, they probably represent a fundamental theme in leadership behavior. A review of 50 years of leadership research, for example, identified

NEW LEADER ACTION MEMO

As a leader, you can succeed in a variety of situations by showing concern for both tasks and people. People- oriented behavior is related to higher follower satisfaction, and task-oriented behavior is typically associated with higher productivity.

50 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

task-oriented behavior and people-oriented behavior as primary categories related to effective leadership in numerous studies.44 Concern for tasks and concern for people must be shown toward followers at some reasonable level, either by the leader or by other people in the system. Although these are not the only important behaviors, as we will see throughout this book, they certainly require attention.

The second question is whether people orientation and task orientation exist together in the same leader, and how. The grid theory argues that yes, both are present when people work with or through others to accomplish an activity. Although leaders may be high on either style, there is considerable belief that the best leaders are high on both behaviors. Eddy Cue, senior vice president of Internet Software and Services at Apple and one of CEO Tim Cook’s trusted advisers, pro- vides an example of a leader who succeeds on both dimensions. Cue is known as a master strategist and tactician who focuses people on key goals for new product launches, establishes plans to reach targets, and may even step in to handle tasks himself to get things done on time. Yet employees also appreciate his softer, people-oriented side. When the development of the iCloud service wasn’t going well, Cue stayed calm and told employees he had confidence in them. He’s respected for being easygoing and friendly and for being willing to make himself vulnerable with employees by openly admitting mistakes.45

The third question concerns whether people can actually change themselves into leaders high on people- or task-orientation. In the 1950s and 1960s, when the Ohio State and Michigan studies were underway, the assumption of researchers was that the behaviors of effective leaders could be emulated by anyone wishing to

EXHIBIT 2.5 Themes of Leader Behavior Research

Sources: Based on Marilyn R. Zuckerman and Lewis J. Hatala, Incredibly American: Releasing the Heart of Quality (Milwaukee, WI: American Society for Quality, 1992), pp. 141–142; and Mark O’Connell, Gary Yukl, and Thomas Taber, “Leader Behavior and LMX: A Constructive Replication,” Journal of Managerial Psychology 27, no. 2 (2012), pp. 143–154.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 51

become an effective leader. In general it seems that people can indeed learn new leader behaviors. Although “high-high” leadership is not the only effective style, researchers have looked to this kind of leader as a candidate for success in a wide variety of situations. However, as we will see in Chapter 3, the next generation of leadership studies refined the understanding of situations to pinpoint more precisely when each type of leadership behavior is most effective.

INDIVIDUALIZED LEADERSHIP Traditional trait and behavior theories assume that a leader adopts a general lead- ership style that is used with all group members. A more recent approach to leader- ship behavior research, individualized leadership, looks instead at the specific relationship between a leader and each individual follower.46 Individualized leadership is based on the notion that a leader develops a unique relationship with each subor- dinate or group member, which determines how the leader behaves toward the mem- ber and how the member responds to the leader. In this view, leadership is a series of dyads, or a series of two-person interactions. The dyadic view focuses on the concept of exchange, what each party gives to and receives from the other.47

The first individualized leadership theory was introduced nearly 40 years ago and has been steadily revised ever since. Exhibit 2.6 illustrates the development of research in this area. The first stage was the awareness of a relationship between a leader and each individual rather than between a leader and a group of followers.

EXHIBIT 2.6 Stages of Development of Individualized Leadership

Sources: Based on Fred Danereau, “A Dyadic Approach to Leadership: Creating and Nurturing This Approach Under Fire,” Leader- ship Quarterly 6, no. 4 (1995), pp. 479–490, and George B. Graen and Mary Uhl-Bien, “Relationship-Based Approach to Leadership: Development of Leader–Member Exchange (LMX) Theory of Leadership over 25 Years: Applying a Multi-Level, Multi-Domain Approach,” Leadership Quarterly 6, no. 2 (1995), pp. 219–247.

Individualized leadership a theory based on the notion that a leader develops a unique relationship with each subordinate or group member, which determines how the leader behaves toward the member and how the member responds to the leader

52 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

The second stage examined specific attributes of the exchange relationship. The third stage explored whether leaders could intentionally develop partnerships with each group member.

Vertical Dyad Linkage Model The vertical dyad linkage (VDL) model argues for the importance of the dyad formed by a leader with each member of the group. Initial findings indicated that followers provided very different descriptions of the same leader. For example, some reported a leader, and their relationship with the leader, as having a high degree of mutual trust, respect, and obligation. These high-quality relationships might be characterized as high on both peo- ple and task orientation. Other followers reported a low-quality relationship with the same leader, such as having a low degree of trust, respect, and obligation. These fol- lowers perceived the leader as being low on important leadership behaviors.

Based on these two extreme behavior patterns, subordinates were found to exist in either an in-group or an out-group in relation to the leader. Exhibit 2.7 delineates the differences in leader behavior toward in-group versus out-group members. Most of us who have had experience with any kind of group, whether it be a college class, an ath- letic team, or a work group, recognize that some leaders may spend a disproportionate amount of time with certain people and that these “insiders” are often highly trusted and may obtain special privileges. In the terminology of the VDL model, these people would be considered to participate in an in-group relationship with the leader, whereas other members of the group who did not experience a sense of trust and extra consider- ation would participate in an out-group relationship. In-group members, those who rated the leader highly, had developed close relationships with the leader and often became assistants who played key roles in the functioning of the work unit. Out-group members were not key players in the work unit.

Thus, by focusing on the relationship between a leader and each individual, the VDL research found great variance of leader style and impact within a group of followers.

EXHIBIT 2.7 Leader Behavior toward In-Group versus Out-Group Members

In-Group Subordinates Out-Group Subordinates

• Provides support and encouragement when employee faces a difficult, stressful task

• Discusses objectives; trusts employee to use his or her own approach in solving problems and reaching goals

• Listens to employee’s suggestions and ideas about how work is done

• Treats mistakes as opportunities for coaching and developing employee

• Gives employee interesting assignments; may allow employee to choose assignment

• Sometimes defers to subordinate’s opinion • Praises accomplishments and performance

improvements

• Shows little consideration if employee is having difficulty with a task

• Gives the employee specific directives for how to accomplish tasks and attain goals

• Shows little interest in employee’s comments and suggestions

• Criticizes or punishes mistakes

• Assigns primarily routine jobs and monitors employee closely

• Usually imposes own views • Focuses on areas of poor performance

Sources: Based on Jean François Manzoni and Jean-Louis Barsoux, “The Set-Up-to-Fail Syndrome,” Harvard Business Review (March–April 1988), pp. 110–113; and Mark O’Donnell, Gary Yukl, and Thomas Taber, “Leader Behavior and LMX: A Constructive Replication,” Journal of Management Psychology 27, no. 2 (2012), pp. 143–154.

NEW LEADER ACTION MEMO Answer the questions in Leader’s Self-Insight 2.3 to understand how LMX theory applies to your own work experience.

Vertical dyad linkage (VDL) model a model of individualized leadership that argues for the importance of the dyad formed by a leader with each member of the group

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 53

Leader–Member Exchange Stage two in the development of the individualized leadership theory explored the leader–member exchange (LMX) in more detail, discovering that the impact on out- comes depends on how the LMX process develops over time. Studies evaluating char- acteristics of the LMX relationship explored such things as communication frequency, value agreement, characteristics of followers, job satisfaction, performance, job cli- mate, and commitment. Leaders typically tend to establish in-group exchange rela- tionships with individuals who have characteristics similar to those of the leader, such as similarity in background, interests, and values, and with those who demon- strate a high level of competence and interest in the job. Overall, studies have found that the quality of the LMX relationship is substantially higher for in-group members. LMX theory proposes that this higher-quality relationship will lead to higher perfor- mance and greater job satisfaction for in-group members, and research in general sup- ports this idea.48 High-quality LMX relationships have been found to lead to very positive outcomes for leaders, followers, work units, and the organization. For fol- lowers, a high-quality exchange relationship may mean more interesting assignments, greater responsibility and authority, and tangible rewards such as pay increases and promotions. Leaders and organizations clearly benefit from the increased effort and initiative of in-group participants to carry out assignments and tasks successfully.

Partnership Building In this third phase of research, the focus was on whether leaders could develop pos- itive relationships with a large number of subordinates. Critics of early LMX theory

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 2.3

Your “LMX” Relationship

Instructions: What was the quality of your leader’s relation- ship with you? Think back to a job you held and recall your feelings toward your leader, or if currently employed use your supervisor. Please answer whether each item below was Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I very much liked my supervisor as a person.

2. My supervisor defended my work to people above him if I made a mistake.

3. The work I did for my supervisor went well beyond what was required.

4. I admired my supervisor’s pro- fessional knowledge and ability.

5. My supervisor was enjoyable to work with.

6. I applied extra effort to further the interests of my work group.

7. My supervisor championed my case to others in the organization.

8. I respected my supervisor’s management competence.

Scoring and Interpretation LMX theory is about the quality of a leader’s relationship with subordinates. If you scored 6 or more Mostly True, your supervisor clearly had an excellent relationship with you, which is stage two in Exhibit 2.6. You had a successful dyad. If your supervisor had an equally good relationship with every subordinate, that is a stage-three level of devel- opment (partnership building). If you scored 3 or fewer Mostly True, then your supervisor was probably at level one, perhaps with different relationships with subordinates, some or all of which were unsuccessful. What do you think accounted for the quality of your and other subordinates’ relationships (positive or negative) with your supervisor? Dis- cuss with other students to learn why some supervisors have good LMX relationships.

Source: Based on Robert C. Liden and John M. Maslyn, “Multidimension- ality of Leader–Member Exchange: An Empirical Assessment through Scale Development,” Journal of Management 24 (1998), pp. 43–72.

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Leader–member exchange (LMX) individualized leadership model that explores how leader–member relation- ships develop over time and how the quality of exchange relationships affects outcomes

pointed out the dangers of leaders establishing sharply differentiated in-group and out-group relationships, in that this may lead to feelings of resentment or even hos- tility among out-group participants.49 If leaders are perceived to be granting exces- sive benefits and advantages to in-group members, members of the out-group may rebel, which can damage the entire organization. Moreover, some studies have found that leaders tend to categorize employees into in-groups and out-groups as early as five days into their relationship.50

Thus, the third phase of research in this area focused on whether leaders could develop positive relationships with all followers. In this approach, the leader views each person independently and may treat each individual in a differ- ent but positive way. That is, leaders strive to develop a positive relationship with each subordinate, but the positive relationship will have a different form for each person. For example, one person might be treated with “consideration” and another with “initiating structure,” depending on what followers need to feel involved and to succeed.

In the LMX research study, leaders were trained to offer the opportunity for a high-quality relationship to all group members, and the followers who responded to the offer dramatically improved their performance. As these relationships matured, the entire work group became more productive, and the payoffs were tremendous. Leaders could count on followers to provide the assistance needed for high performance, and followers participated in and influenced decisions. The implications of this finding are that true performance and productivity gains can be achieved by having the leader develop positive relationships one on one with each subordinate.

ENTREPRENEURIAL TRAITS AND BEHAVIORS Another topic of special concern in today’s fast-changing world is what traits encourage entrepreneurship. Entrepreneurship refers to initiating a business ven- ture, organizing the necessary resources, and assuming the associated risks and rewards.51 An entrepreneur recognizes a viable idea for a business product or ser- vice and carries it out by finding and assembling the necessary resources—money, people, machinery, location—to undertake the business venture.

Entrepreneurial leaders display many of the same characteristics as other lea- ders, but some traits are particularly important for entrepreneurs. These leaders need strong drive, enthusiasm, and future vision. They tend to be persistent, inde- pendent, and action oriented. They are drawn to new opportunities and are more concerned with innovation, creativity, and creating new processes than with main- taining the status quo. They are typically highly self-motivated and are willing to stretch themselves and take risks for improvement.52

A good example of entrepreneurial traits is Clara Shih, who started Hearsay Social, a platform that helps large companies manage their employees’ presence on social media sites. Revenue was around $10 million in 2010, and Shih believes the company can grow large and profitable as leaders continue to struggle with how to monitor and manage the new world of social media. The 29-year-old Shih has worked hard to raise millions in financing and has gained the support of Facebook COO Sheryl Sandberg as a mentor.53 Leaders with entrepreneurial traits also exist within established organizations. These leaders take risks to create novel solutions to competitive challenges confronting a

NEW LEADER ACTION MEMO As a leader, you can build a positive, individualized rela- tionship with each follower to create an equitable work en- vironment and provide greater benefits to yourself, followers, and the organization.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 55

business, especially the development or enhancement of products and services. Entrepreneurial leadership is a source of innovation and change for established companies.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • The point of this chapter is to understand the importance of traits and behaviors

in the development of leadership theory and research. Some traits associated with effective leadership include optimism, self-confidence, honesty, and drive. A large number of personal traits and abilities have been associated with successful lea- ders, but traits themselves are not sufficient to guarantee effective leadership.

• Natural traits and behavior patterns can be developed into strengths. It is important for leaders to recognize their strengths and acknowledge the interde- pendence that is a key to effective leadership.

• Research suggests that different leader strengths might be better suited to differ- ent types of leadership roles. The chapter describes three types of roles: opera- tional roles, collaborative roles, and advisory roles. Leaders can be more effective when they are in positions that best match their natural tendencies.

• The behavior approach explored autocratic versus democratic leadership, con- sideration versus initiating structure, employee-centered versus job-centered leadership, and concern for people versus concern for production. The theme of people versus tasks runs through this research, suggesting these are funda- mental behaviors through which leaders meet followers’ needs. There has been some disagreement in the research about whether a specific leader is either people- or task oriented or whether one can be both. Today, the consensus is that leaders can achieve a “high-high” leadership style.

• Another approach is the dyad between a leader and each follower. Followers have different relationships with the leader, and the ability of the leader to develop a positive relationship with each follower contributes to team perfor- mance. The LMX theory says that high-quality relationships have a positive outcome for leaders, followers, work units, and the organization. Leaders can attempt to build individualized relationships with each individual as a way to meet needs for both consideration and structure.

• The historical development of leadership theory presented in this chapter intro- duces some important ideas about leadership. Although certain personal traits and abilities indicate a greater likelihood for success in a leadership role, they are not in themselves sufficient to guarantee effective leadership. Rather, beha- viors are equally significant. Therefore, the style of leadership demonstrated by an individual greatly determines the outcome of the leadership endeavor. Often, a combination of behavioral styles is most effective. To understand the effects of leadership on outcomes, the specific relationship behavior between a leader and each follower is also an important consideration.

• Entrepreneurial leadership is of great concern in today’s turbulent environment because entrepreneurial leadership is an important source of innovation and change. Entrepreneurial leaders take risks to bring new organizations into being or create novel solutions to competitive challenges confronting existing organizations.

Tw itt er

56 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

DISCUSSION QUESTIONS 1. Why is it important for leaders to know their strengths? Do you think leaders should

spend equal time learning about their weak points?

2. Suggest some personal traits of leaders you have known. What traits do you believe are most valuable? Why?

3. The chapter suggests that optimism is an important trait for a leader, yet some employees complain that optimistic leaders create significant stress because they don’t anticipate pro- blems and expect their subordinates to meet unreasonable goals. Do you agree? Why?

4. What is the difference between trait theories and behavioral theories of leadership?

5. Would you feel most comfortable using a “consideration” or an “initiating-structure” leadership style? Discuss the reasons for your answer.

6. The vertical dyad linkage model suggests that followers respond individually to the leader. If this is so, what advice would you give leaders about displaying people- oriented versus task-oriented behavior?

7. Does it make sense to you that a leader should develop an individualized relationship with each follower? Explain advantages and disadvantages to this approach.

8. Why would subordinates under a democratic leader perform better in the leader’s absence than would subordinates under an autocratic leader?

9. Why is an entrepreneurial leader important to an organization? How is this role differ- ent from other leader roles?

10. Pick three traits from the list in Exhibit 2.1 that you think would be most valuable for a leader in an operational role. Pick three that you think would be most valuable for a leader in a collaborative role. Explain your choices.

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LEADERSHIP AT WORK Your Ideal Leader Traits Spend some time thinking about someone you believe is an ideal leader. For the first part of the exercise, select an ideal leader you have heard about whom you don’t personally know. It could be someone like Mother Teresa, Martin Luther King, Abraham Lincoln, or any national or international figure that you admire. Write the person’s name here: . Now, in the space below, write down three things you admire about the person, such as what he or she did or the qualities that person possesses.

For the second part of the exercise, select an ideal leader whom you know personally. This can be anyone from your life experiences. Write the person’s name here: . Now, in the space below, write down three things you admire about the person, such as what he or she did or the qualities that person possesses.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 57

The first leader you chose represents something of a projective test based on what you’ve heard or read. You imagine the leader has the qualities you listed. The deeds and qualities you listed say more about what you admire than about the actual traits of the leader you chose. This is something like an inkblot test, and it is important because the traits you assign to the leader are traits you are aware of, have the potential to develop, and indeed can develop as a leader. The qualities or achievements you listed are an indi- cator of the traits you likely will express as you develop into the leader you want to become.

The second leader you chose is someone you know, so it is less of a projective test and represents traits you have had direct experience with. You know these traits work for you and likely will become the traits you develop and express as a leader.

What is similar about the traits you listed for the two leaders? Different? Interview another student in class about traits he or she admires. What do the traits tell you about the person you are interviewing? What are the common themes in your list and the other student’s list of traits? To what extent do you display the same traits as the ones on your list? Will you develop those traits even more in the future?

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LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Consolidated Products Consolidated Products is a medium-sized manufacturer of consumer products with non- unionized production workers. Ben Samuels was a plant manager for Consolidated Products for 10 years, and he was very well liked by the employees there. They were grateful for the fitness center he built for employees, and they enjoyed the social activities sponsored by the plant several times a year, including company picnics and holiday parties. He knew most of the workers by name, and he spent part of each day walking around the plant to visit with them and ask about their families or hobbies.

Ben believed that it was important to treat employees properly so they would have a sense of loyalty to the company. He tried to avoid any layoffs when production demand was slack, figuring that the company could not afford to lose skilled workers that are so dif- ficult to replace. The workers knew that if they had a special problem, Ben would try to help them. For example, when someone was injured but wanted to continue working, Ben found another job in the plant that the person could do despite having a disability. Ben believed that if you treat people right, they would do a good job for you without close supervision or prodding. Ben applied the same principle to his supervisors, and he mostly left them alone to run their departments as they saw fit. He did not set objectives and standards for the plant, and he never asked the supervisors to develop plans for improving productivity and product quality.

Under Ben, the plant had the lowest turnover among the company’s five plants, but the second worst record for costs and production levels. When the company was acquired by another firm, Ben was asked to take early retirement, and Phil Jones was brought in to replace him.

Phil had a growing reputation as a manager who could get things done, and he quickly began making changes. Costs were cut by trimming a number of activities such as the fitness center at the plant, company picnics and parties, and the human relations

58 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

training programs for supervisors. Phil believed that human relations training was a waste of time; if employees don’t want to do the work, get rid of them and find some- body else who does.

Supervisors were instructed to establish high performance standards for their depart- ments and insist that people achieve them. A computer monitoring system was introduced so that the output of each worker could be checked closely against the standards. Phil told his supervisors to give any worker who had substandard performance one warning, and then if performance did not improve within two weeks to fire the person. Phil believed that workers don’t respect a supervisor who is weak and passive. When Phil observed a worker wasting time or making a mistake, he would reprimand the person right on the spot to set an example. Phil also checked closely on the performance of his supervisors. Demanding objectives were set for each department, and weekly meetings were held with each supervisor to review department performance. Finally, Phil insisted that supervisors check with him first before taking any significant actions that deviated from established plans and policies.

As another cost-cutting move, Phil reduced the frequency of equipment maintenance, which required machines to be idled when they could be productive. Since the machines had a good record of reliable operation, Phil believed that the current maintenance schedule was excessive and was cutting into production. Finally, when business was slow for one of the product lines, Phil laid off workers rather than finding something else for them to do.

By the end of Phil’s first year as plant manager, production costs were reduced by 20 percent and production output was up by 10 percent. However, three of his seven supervisors left to take other jobs, and turnover was also high among the machine operators. Some of the turnover was due to workers who were fired, but competent machine operators were also quitting, and it was becoming increasingly difficult to find any replacements for them. Finally, there was increasing talk of unionizing among the workers.54

QUESTIONS

1. Compare the leadership traits and behaviors of Ben Samuels and Phil Jones.

2. Which leader do you think is more effective? Why? Which leader would you prefer to work for?

3. If you were Phil Jones’s boss, what would you do now?

Transition to Leadership My name is Michael Collins. When I was named Southwest Regional Manager of Creighton Auto Parts, a major parts sales and service corporation, I saw the transition period before and immediately following my appointment as an exciting new opportunity. With a degree in automotive engineering and several years’ experience in parts manufacturing (design and plant management), I came to the new position with strong industry connections and a keen eye for trends and product innovation.

During the initial stages of the transition, I met with the outgoing regional manager, receiving his input about ongoing business issues, how current services tallied with the cor- poration’s short and long-term goals, and what he saw as the strengths and weaknesses of the various stores and personnel within the region. While some of these meetings took place at his office, I wanted to avoid the appearance of depending on “the old man” for guidance, so I scheduled most of our meetings off-site to provide more opportunities for frank

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 59

discussion covering procedures, products and services, and individual stakeholders from employees and board members to suppliers and customers.

In addition, I spent a great deal of time making my own assessments. I knew my com- pany honeymoon period would be limited. My vision and my implementation program had to be clear with well-defined strategies. As a first step, I sent a lengthy e-mail message to all key players on my new leadership team both as introduction and as a prelude to establishing my vision and transition program.

I traveled around the region meeting with the store managers on my regional team, as well as holding informal meetings with front-line employees. In so doing, I was surprised to tap into the rumor mill and find individuals who were eager to talk openly about their goals, ideas, opinions, and complaints. My questions to front-line workers, in particular, had both positive and negative aspects. I questioned them about their length of service, what they liked most about the company, what areas they thought could be improved, how they rated the culture—things like that. I discovered that for most of them, this was more than just a job. Many had worked for the company for a number of years and had a great deal of pride in the company, as well as a deep sense of responsibility toward their customers.

However, I found this portion of my on-site visits the most intrusive on my time, and in many cases I regretted the amount of time spent I listening to workers. I wondered if the advance warning of my visit allowed too much time for people to prepare their answers. I wondered how many were genuine in their responses and how many were just trying to hold on to their jobs. Worse, I found myself hostage to those who wanted to rant on and on about workplace issues, their training, their bosses, even their customers. I talked to a few customers and didn’t get much from that either. As I proceeded through the on-site vis- its, I found myself growing impatient, increasingly checking my watch to see how soon I should leave for the next appointment on a packed schedule. I admit I expected more from this portion of the transition than I received. However, once I committed to this, I felt obli- gated to see it through.

More rewarding was the time spent with the marketing staff exploring customer satisfaction levels. In focusing on customers, I zeroed in on three research areas: cus- tomer complaints, area demographics, and the compounding customer—those return customers who generate additional sales among their friends and family. Why do custo- mers come? What makes them return? What are their personal “hot buttons”—needs or breaking points in dealing with service industries? Our market research showed large segments of our population in four areas: under 30, over 60, Hispanics, and women. We also saw an increasing number of unemployed and under-employed do-it-yourself customers trying to keep the family vehicle going just a little longer. I personally love analyzing market data.

My question for regional service, sales, and marketing was “how are we reaching and retaining these segments of the population?” Do advertising, Web sites, direct mail- ing, coupon campaigns, and other marketing strategies match these demographics? For example, are we providing and training Spanish-language sales and service experts and consumer information? With large segments of young people, senior citizens, the unem- ployed, and single moms, wouldn’t these large segments of the population offer fabulous compounding opportunities with focused marketing and price breaks?

As I take the reins, I am excited about the marketing challenges and opportunities ahead. I am an idea guy, a hands-on manager whose ideal is the Renaissance man capable of doing many things very well. I like to surround myself with similar kinds of people. I generate ideas and expect follow-up and accountability. The leadership model I embrace sets the bar high for me and for everyone who works for me. I look forward to injecting a new vision and new standards of service throughout the region.

60 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

QUESTIONS

1. What do you see as Michael Collins’s leadership traits? Which of these traits do you consider a strength? A weakness? Explain.

2. What do you think of Michael Collins’s approach to leading the region? How would you characterize his people-oriented versus task-oriented style? Why?

3. How might an understanding of individualized leadership be useful to Collins with respect to his relationship with marketing versus store personnel?

REFERENCES 1. Jessi Hempel, “IBM’s New CEO Looks Ahead,” Fortune (October 8,

2012), pp. 116–123; and Claire Cain Miller and Quentin Hardy, “For Incoming I.B.M. Chief, Self-Confidence Is Rewarded,” The New York Times (October 27, 2011), http://www.nytimes.com/2011/10/28 /business/for-incoming-ibm-chief-self-confidence-rewarded.html (accessed October 28, 2011).

2. G. A. Yukl, Leadership in Organizations (Upper Saddle River, NJ: Prentice Hall, 1981); and S. C. Kohs and K. W. Irle, “Prophesying Army Promotion,” Journal of Applied Psychology 4 (1920), pp. 73–87.

3. Yukl, Leadership in Organizations, p. 254.

4. R. M. Stogdill, “Personal Factors Associated with Leadership: A Survey of the Literature,” Journal of Psychology 25 (1948), pp. 35–71.

5. R. M. Stogdill, Handbook of Leadership: A Survey of the Literature (New York: The Free Press, 1974); and Bernard M. Bass, Bass & Stogdill’s Handbook of Leadership: Theory, Research, and Manage- rial Applications, 3rd ed. (New York: The Free Press, 1990).

6. S. A. Kirkpatrick and E. A. Locke, “Leadership: Do Traits Matter?” The Academy of Management Executive 5, no. 2 (1991), pp. 48–60.

7. R. G. Lord, C. L. DeVader, and G. M. Alliger, “A Meta-Analysis of the Relation between Personality Traits and Leadership Perceptions: An Application of Validity Generalization Procedures,” Journal of Applied Psychology 71 (1986), pp. 402–410.

8. Study reported in “From the Front Lines: How Does Leadership Personality Affect Performance?” Leader to Leader (Winter 2007), pp. 56–57; and Bradley R. Agle, Nandu J. Nagarajan, Jeffrey A. Sonnenfeld, and Dhinu Srinivasan, “Does CEO Charisma Matter? An Empirical Analysis of the Relationships among Organizational Performance, Environmental Uncertainty, and Top Management Team Perceptions of CEO Charisma,” Academy of Management Journal 49, no. 1 (2006), pp. 161–174.

9. Andrew St. George, “Leadership Lessons from the Royal Navy,” McKinsey Quarterly (January 2013), http://www.mckinseyquarterly .com/Leadership_lessons_from_the_Royal_Navy_3053 (accessed February 7, 2013).

10. Patrick Lencioni, “The Most Important Leadership Trait You Shun,” The Wall Street Journal (June 21, 2010), http://online.wsj.com/article /SB1 000 14 24 05 27 48 704 89 52 04 57 53 213 80 62 76 19 388 .html (accessed March 11, 2013).

11. Edwin Locke and Associates, The Essence of Leadership (New York: Lexington Books, 1991).

12. A summary of various studies and surveys is reported in Del Jones, “Optimism Puts Rose-Colored Tint in Glasses of Top Execs,” USA Today (December 15, 2005).

13. See Elaine Fox, “The Essence of Optimism,” Scientific American Mind (January–February 2013), pp. 22–27.

14. Arthur Bandura, “Self-efficacy,” in V. S. Ramachaudran, ed., Encyclopedia of Human Behavior, vol. 4 (New York: Academic

Press, 1994), pp. 71–81; and Elizabeth A. McDaniel and Holly DiBella-McCarthy, “Reflective Leaders Become Causal Agents of Change,” Journal of Management Development 31, no. 7 (2012), pp. 663–671.

15. Shelley A. Kirkpatrick and Edwin A. Locke, “Leadership: Do Traits Matter?” Academy of Management Executive 5, no. 2 (1991), pp. 48–60.

16. Larry Neumeister and Tom Hays, “Madoff Sent to Jail as Furious Victims Applaud,” The Huffington Post (March 12, 2009), http:// www.huffingtonpost.com/2009/03/12/madoff-arrives-in-court -f_n_174194.html (accessed May 30, 2013); and Julie Creswell and Landon Thomas Jr., “The Talented Mr. Madoff,” The New York Times (January 25, 2009), p. BU1.

17. James M. Kouzes and Barry Z. Posner, Credibility: How Leaders Gain and Lose It, Why People Demand It (San Francisco: Jossey-Bass, 1993), p. 14.

18. Kirkpatrick and Locke, “Leadership: Do Traits Matter?”

19. Patricia Sellers, “Marissa Mayer: Ready to Rumble at Yahoo,” Fortune (October 29, 2012), pp. 118–128; and Julianne Pepitone, “Marissa Mayer: Yahoos Can No Longer Work from Home,” CNN Money (February 25, 2013), http://money.cnn.com/2013/02/25/technology /yahoo-work-from-home/index.html (accessed March 11, 2013).

20. “Towards a More Perfect Match: Building Successful Leaders by Effectively Aligning People and Roles,” Hay Group Working Paper (2004); and “Making Sure the Suit Fits,” Hay Group Research Brief (2004). Both available from Hay Group, The McClelland Center, 116 Huntington Avenue, Boston, MA 02116, or at http://www.haygroup .com.

21. The following is based on Marcus Buckingham and Donald O. Clifton, Now, Discover Your Strengths (New York: The Free Press, 2001); and Chuck Martin with Peg Dawson and Richard Guare, Smarts: Are We Hardwired for Success? (New York: AMACOM, 2007).

22. Deborah Ancona, Thomas W. Malone, Wanda J. Orlikowski, and Peter M. Senge, “In Praise of the Incomplete Leader,” Harvard Business Review (February 2007), pp. 92–100.

23. Center for Creative Leadership survey results, reported in “The Demise of the Heroic Leader,” Leader to Leader (Fall 2006), pp. 55–56.

24. Buckingham and Clifton, Now, Discover Your Strengths, p. 12.

25. Ibid.

26. Luisa Kroll, “Inside the 2013 Billionaires List: Facts and Figures,” Forbes (March 4, 2013), http://www.forbes.com/sites/luisakroll/2013 /03/04/inside-the-2013-billionaires-list-facts-and-figures/ (accessed March 12, 2013); Bill George, “The Master Gives It Back,” segment in “Special Report: America’s Best Leaders,” U.S. News and World Report (October 30, 2006), pp. 50–87; and Richard L. Daft, The Executive and the Elephant: A Leader’s Guide to Building Inner Excellence (San Francisco: Jossey-Bass, 2010), p. 149.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 61

27. This discussion is based on Ron Garonzik, Geoff Nethersell, and Scott Spreier, “Navigating through the New Leadership Landscape,” Leader to Leader (Winter 2006), pp. 30–39; “Towards a More Perfect Match: Building Successful Leaders by Effectively Aligning People and Roles,” Hay Group Working Paper (2004); and “Making Sure the ‘Suit’ Fits,” Hay Group Research Brief (2004). Available from Hay Group, The McClelland Center, 116 Huntington Avenue, Boston, MA 02116, or at http://www.haygroup.com.

28. K. Lewin, “Field Theory and Experiment in Social Psychology: Concepts and Methods,” American Journal of Sociology 44 (1939), pp. 868–896; K. Lewin and R. Lippett, “An Experimental Approach to the Study of Autocracy and Democracy: A Preliminary Note,” Sociometry 1 (1938), pp. 292–300; and K. Lewin, R. Lippett, and R. K. White, “Patterns of Aggressive Behavior in Experimentally Created Social Climates,” Journal of Social Psychology 10 (1939), pp. 271–301.

29. R. Tannenbaum and W. H. Schmidt, “How to Choose a Leadership Pattern,” Harvard Business Review 36 (1958), pp. 95–101.

30. F. A. Heller and G. A. Yukl, “Participation, Managerial Decision- Making and Situational Variables,” Organizational Behavior and Human Performance 4 (1969), pp. 227–241.

31. “Jack’s Recipe (Management Principles Used by Jack Hartnett, President of D. L. Rogers Corp.),” sidebar in Marc Ballon, “Extreme Managing: Equal Parts Old-Fashioned Dictator and New Age Father Figure, Jack Hartnett Breaks Nearly Every Rule of the Enlightened Manager’s Code,” Inc. (July 1998), p. 60.

32. Donna Fenn, “The Remote Control CEO,” Inc. (October 2005), pp. 96–101, 144–146.

33. J. K. Hemphill and A. E. Coons, “Development of the Leader Behavior Description Questionnaire,” in R. M. Stogdill and A. E. Coons, eds., Leader Behavior: Its Description and Measurement (Columbus: Ohio State University, Bureau of Business Research, 1957).

34. P. C. Nystrom, “Managers and the High-High Leader Myth,” Academy of Management Journal 21 (1978), pp. 325–331; and L. L. Larson, J. G. Hunt, and Richard N. Osborn, “The Great High- High Leader Behavior Myth: A Lesson from Occam’s Razor,” Academy of Management Journal 19 (1976), pp. 628–641.

35. Christopher Cooper, “Speed Trap: How a Marine Lost His Command in Race to Baghdad,” The Wall Street Journal (April 5, 2004), pp. A1, A15.

36. E. W. Skinner, “Relationships between Leadership Behavior Patterns and Organizational-Situational Variables,” Personnel Psychology 22 (1969), pp. 489–494; E. A. Fleishman and E. F. Harris, “Patterns of Leadership Behavior Related to Employee Grievances and Turnover,” Personnel Psychology 15 (1962), pp. 43–56; and Ronald F. Piccolo, Joyce E. Bono, Kathrin Heinitz, Jens Rowold, Emily Duehr, and Timothy A. Judge, “The Relative Impact of Complementary Leader Behaviors: Which Matter Most?” The Leadership Quaterly 23 (2012), pp. 567–581.

37. A. W. Halpin and B. J. Winer, “A Factorial Study of the Leader Behavior Descriptions,” in R. M. Stogdill and A. E. Coons, eds., Leader Behavior: Its Descriptions and Measurement (Columbus: Ohio State University, Bureau of Business Research, 1957); and J. K. Hemphill, “Leadership Behavior Associated with the Administrative Reputations of College Departments,” Journal of Educational Psychology 46 (1955), pp. 385–401.

38. R. Likert, “From Production- and Employee-Centeredness to Systems 1–4,” Journal of Management 5 (1979), pp. 147–156.

39. J. Taylor and D. Bowers, The Survey of Organizations: A Machine Scored Standardized Questionnaire Instrument (Ann Arbor: Institute for Social Research, University of Michigan, 1972).

40. D. G. Bowers and S. E. Seashore, “Predicting Organizational Effectiveness with a Four-Factor Theory of Leadership,” Adminis- trative Science Quarterly 11 (1966), pp. 238–263.

41. Ibid.

42. Robert Blake and Jane S. Mouton, The Managerial Grid III (Houston: Gulf Publishing Company, 1985).

43. Diane Brady and Matthew Boyle, “Campbell’s Recipe for a CEO Yields Denise Morrison,” Business Week (June 23, 2011), http:// www.businessweek.com/magazine/content/11_27/b4235060614059 .htm (accessed March 12, 2013); Michael Arrington, “The Way I Work: My Style Is to Bust the Door Down and Clean the Mess Up Later,” Inc. (October 2010), pp. 124–128; and Jeff Bercovici, “TechCrunch CEO Reported Out after Clashing with HuffPost-ers,” Forbes (November 17, 2011), http://www.forbes.com/sites/jeffbercovici /2011/11/17/techcrunch-ceo-reported-out-after-clashing-with-huffpost-ers/ (accessed March 13, 2013).

44. Gary Yukl, “Effective Leadership Behavior: What We Know and What Questions Need More Attention,” Academy of Management Perspectives 26 (November 2012), pp. 66–80; and Gary Yukl, Angela Gordon, and Tom Taber, “A Hierarchical Taxonomy of Leadership Behavior: Integrating a Half Century of Behavior Research,” Journal of Leadership and Organizational Studies 9, no. 1 (2002), pp. 15–32.

45. Jessica E. Lessin, “Eddy Cue: Apple’s Rising Mr. Fix-It,” The Wall Street Journal (November 28, 2012), p. B1.

46. Francis J. Yammarino and Fred Dansereau, “Individualized Leader- ship,” Journal of Leadership and Organizational Studies 9, no. 1 (2002), pp. 90–99; Gary Yukl, Mark O’Donnell, and Thomas Taber, “Influence of Leader Behaviors on the Leader-Member Exchange Relationship,” Journal of Managerial Psychology 24, no. 4 (2009), pp. 289–299; and M. O’Donnell, G. Yukl, and T. Taber, “Leader Behavior and LMX: A Constructive Replication,” Journal of Management Psychology 27, no. 2 (2012), pp. 143–154.

47. This discussion is based on Fred Dansereau, “A Dyadic Approach to Leadership: Creating and Nurturing This Approach under Fire,” Leadership Quarterly 6, no. 4 (1995), pp. 479–490; and George B. Graen and Mary Uhl-Bien, “Relationship-Based Approach to Leader- ship: Development of Leader–Member Exchange (LMX) Theory of Leadership over 25 Years: Applying a Multi-Level Multi-Domain Approach,” Leadership Quarterly 6, no. 2 (1995), pp. 219–247.

48. See A. J. Kinicki and R. P. Vecchio, “Influences on the Quality of Supervisor-Subordinate Relations: The Role of Time Pressure, Organizational Commitment, and Locus of Control,” Journal of Organizational Behavior (January 1994), pp. 75–82; R. C. Liden, S. J. Wayne, and D. Stilwell, “A Longitudinal Study on the Early Development of Leader–Member Exchanges,” Journal of Applied Psychology (August 1993), pp. 662–674; Yammarino and Dansereau, “Individualized Leadership”; Jean-François Manzoni and Jean-Louis Barsoux, “The Set-Up-to-Fail Syndrome,” Harvard Business Review 76 (March–April 1998), pp. 101–113; Yukl et al., “Influence of Leader Behaviors on the Leader-Member Exchange Relationship”; and O’Donnell et al., “Leader Behavior and LMX: A Constructive Replication.”

49. W. E. McClane, “Implications of Member Role Differentiation: Analysis of a Key Concept in the LMX Model of Leadership,” Group and Organization Studies 16 (1991), pp. 102–113; and Gary Yukl, Leadership in Organizations, 2nd ed. (Upper Saddle River, NJ: Prentice Hall, 1989).

50. Manzoni and Barsoux, “The Set-Up-to-Fail Syndrome.”

51. Donald F. Kuratko and Richard M. Hodgetts, Entrepreneurship: A Contemporary Approach, 4th ed. (Fort Worth, TX: Dryden Press, 1998), p. 30.

62 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

52. Kristina L. Guo, “Core Competencies of the Entrepreneurial Leader in Health Care Organizations,” Health Care Manager 28 (January–March 2009), pp. 19–29; and Gary A. Knight, “Cross- Cultural Reliability and Validity of a Scale to Measure Firm Entrepreneurial Orientation,” Journal of Business Venturing 12 (1997), pp. 213–225.

53. Colleen Leahey, “Doing It for Themselves,” Fortune (October 17, 2011), pp. 144–148.

54. Reprinted with permission from Gary Yukl, Leadership in Organiza- tions, 4th ed. (Upper Saddle River, NJ: Prentice Hall, 1998), pp. 66–67.

CHAPTER 2 TRAITS, BEHAVIORS, AND RELATIONSHIPS 63

Chapter 3: Contingency Approaches to Leadership

Tr av el /B en

Pi pe

Ph ot og ra ph y/ Th e Im ag e Ba nk /G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After studying this chapter, you should be able to:

• Understand how leadership is often contingent on people and situations. • Apply Hersey and Blanchard’s situational theory of leader style to the level of follower readiness. • Apply Fiedler’s contingency model to key relationships among leader style, situational favorability,

and group task performance.

• Explain the path–goal theory of leadership. • Use the Vroom–Jago model to identify the correct amount of follower participation in specific

decision situations.

• Know how to use the power of situational variables to substitute for or neutralize the need for leadership.

CHAPTER OUTLINE 66 The Contingency Approach

68 Hersey and Blanchard’s Situational Theory

72 Fiedler’s Contingency Model

76 Path–Goal Theory

81 The Vroom–Jago Contingency Model

88 Substitutes for Leadership

In The Lead

72 Janette Sadik-Khan, New York City Transportation Commissioner

75 Sergio Marchionne, Chrysler Group LLC

78 Alan Robbins, Plastic Lumber Company

86 Art Weinstein, Whitlock Manufacturing

88 Daniel Snyder, Washington Redskins

Leader’s Self-Insight

69 T–P Leadership Question- naire: An Assessment of Style

73 Are You Ready?

90 Measuring Substitutes for Leadership

Leader’s Bookshelf

67 Shackleton’s Way: Leadership Lessons from the Great Antarctic Explorer

Leadership at Work

92 Task versus Relationship Role Play

Leadership Development: Cases for Analysis

93 Alvis Corporation

94 An Impossible Dream?

T im Cook, CEO of Apple, is a quiet, humble, thoughtful leader with a data- driven, analytical, and detail-oriented approach. His predecessor, the late, legendary Steve Jobs, had a forceful, sometimes arrogant personality and a

driven, willful approach to leadership. He was creative rather than analytical and took a big-picture view rather than considering the details.1 Yet both leaders have been successful, and both have effectively led the same company.

This example points to what researchers of leader traits and behaviors eventually discovered: Many different leadership styles can be effective. What, then, determines the success of a leadership style?

One factor that affects what leadership approach will be most effective is the situation in which leadership activities occur. Over the years, researchers have observed that leaders frequently behave situationally—that is, they adjust their leadership style depending on a variety of factors in the situations they face. In this chapter, we discuss the elements of leader, followers, and the situation, and the impact each has upon the others. We examine several theories that define how leadership styles, follower attributes, and organizational characteristics fit together to enable successful leadership.

65 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

The important point of this chapter is that the most effective leadership approach depends on many factors. Understanding the contingency approaches can help a leader adapt his or her approach, although it is important to recognize that leaders also develop their ability to adapt through experience and practice.

THE CONTINGENCY APPROACH The failure to find universal leader traits or behaviors that would always determine effective leadership led researchers in a new direction. Although leader behavior was still examined, the central focus of the new research was the situation in which leadership occurred. The basic tenet of this focus was that behavior effective in some circumstances might be ineffective under different conditions. Thus, the effectiveness of leader behavior is contingent upon organizational situations. Aptly called contin- gency approaches, these theories explain the relationship between leadership styles and effectiveness in specific situations.

The universalistic approach as described in Chapter 2 is compared to the contin- gency approach used in this chapter in Exhibit 3.1. In the previous chapter, researchers were investigating traits or behaviors that could improve performance and satisfaction in any or all situations. They sought universal leadership traits and behaviors. Contingency means that one thing depends on other things, and for a leader to be effective there must be an appropriate fit between the leader’s behavior and style and the conditions in the situation. A leadership style that works in one situation might not work in another situation. There is no one best way of leadership. Contingency means “it depends.” Many leaders today look to an early twentieth-century explorer for inspiration on how to lead through an extreme situation, as described in this chapter’s Leader’s Bookshelf.

The contingencies most important to leadership as shown in Exhibit 3.1 are the sit- uation and followers. Research implies that situational variables such as task, structure, context, and environment are important to leadership style. The nature of followers has

EXHIBIT 3.1 Comparing the Universalistic and Contingency Approaches to Leadership

Contingency a theory meaning one thing depends on other things

66 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

also been identified as a key contingency. Thus, the needs, maturity, and cohesiveness of followers make a significant difference to the best style of leadership.

Several models of situational leadership have been developed. The situational theory of Hersey and Blanchard, the contingency model developed by Fiedler and his associates, path–goal theory, the Vroom–Jago model of decision participation, and the substitutes-for-leadership concept will all be described in this chapter. These contingency approaches seek to delineate the characteristics of situations and followers and examine the leadership styles that can be used effectively. Assuming that a leader can properly diagnose a situation and muster the flexibility to behave according to the appropriate style, successful outcomes are highly likely.

LEADER’S BOOKSHELF Shackleton’s Way: Leadership Lessons from the Great Antarctic Explorer

by Margot Morrell and Stephanie Capparell

“Men wanted for hazardous journey. Small wages. Bitter cold. Long months of complete darkness. Constant danger. Safe return doubtful. Honour and recog- nition in case of success.”

Would you sign up for this job? When Sir Ernest Shackleton set out with a crew of 27 in 1914 with the goal of crossing the continent of Antarctica on foot, he probably didn’t understand how utterly true the wording of his ad would turn out to be. His boat, the Endurance, never even touched land but became stuck in ice in the Weddell Sea for months and eventually sank. The men were left drifting on ice floes 1,200 miles from civi- lization, in dangerous cold, with only three lifeboats and limited provisions. They must have been terrified, and things didn’t get much better for almost two long, brutal years. But, amazingly, every member of Shackleton’s crew survived.

Margot Morrell and Stephanie Capparell analyzed the diaries of Shackleton and crew members to under- stand what brand of leadership enabled their survival through severe cold, isola- tion, near starvation, life-threatening storms, and all manner of other hardships. Their book tells a fascinating and inspiring adventure story but also offers lessons for today’s leaders about how to lead in a situation of great stress and hardship.

LESSONS FOR LEADING IN TOUGH TIMES Shackleton’s team eventually made it to a small island and waited while Shack- leton and a few members took a small

boat 800 miles over treacherous seas to a whaling station, and then Shackleton took a ship back to rescue the others. Here are some tips from Shackleton’s handling of the crew that apply to lead- ing through any tough situation.

• Step up immediately. After they aban- doned the sinking ship, Shackleton encouraged people with a simple speech that acknowledged the dan- gers but expressed optimism and made clear that he was in charge and he would lead them through this. “Optimism is true moral courage,” Shackleton is quoted as saying. By expressing optimism, Shackleton reminded crew members of the faith he had in each of them.

• Keep fairness in mind always. Shackleton placed great value on every member of the crew, and he gained their admiration and respect by his fair, consistent, and egalitarian treatment of them. Each member was expected to do any job on the ship. One high-ranking crew mem- ber wrote: “[S]crubbing the floors … humbles one and knocks out of one any last remnants of false pride that one may have left in one and for this reason I do it voluntarily.”

• Let everyone contribute to success. When disaster struck, Shackleton knew the various tasks that had to be performed if the group were to survive, and he made sure every- one had assignments that let them contribute to the solution to

their dire predicament. To keep spirits high, he used humor and other diversions (one of the few items he rescued from the sinking ship was a banjo). He took the most difficult people into his own tent to win their support and prevent them from infecting the rest of the crew with discouragement.

ADAPTABILITY MAKES IT POSSIBLE Shackleton always looked ahead and kept his eye on the big picture, which enabled him to quickly change course in the face of the unexpected. Commu- nication, especially by listening, helped him see when a new course of action might be needed. Just before the Endurance sailed, he fired the cook and three crew members because he learned through listening and observa- tion that they could damage the morale and effectiveness of the crew. “Shackleton’s optimism was never fool- hardy,” the book points out. He had confidence in his own abilities and in the abilities of his crew, and he was able to stay flexible enough to aban- don what wasn’t working and try something new. It’s a big part of the reason the group survived—and why eight of the crew members came for- ward to join Shackleton on his final expedition some years later.

Source: Shackleton’s Way, by Margot Morrell and Stephanie Capparell, is published by Viking Penguin.

hu tte rs to ck .c om

Contingency approaches approaches that seek to delineate the characteristics of situations and followers and examine the leadership styles that can be used effectively

Two basic leadership behaviors that can be adjusted to address various contingen- cies are task behavior and relationship behavior, introduced in the previous chapter. Research has identified these two meta-categories, or broadly defined behavior catego- ries, as applicable to leadership in a variety of situations and time periods.2 A leader can adapt his or her style to be high or low on both task and relationship behavior. Exhibit 3.2 illustrates the four possible behavior approaches—low task–high relation- ship, high task–high relationship, high task–low relationship, and low task–low rela- tionship. The exhibit describes typical task and relationship behaviors. High task behaviors include planning short-term activities, clarifying tasks, objectives, and role expectations, and monitoring operations and performance. High relationship beha- viors include providing support and recognition, developing followers’ skills and con- fidence, and consulting and empowering followers when making decisions and solving problems. Most leaders typically lean toward being stronger in either task-oriented or relationship-oriented behavior, but most experts suggest that a balance of concern for tasks and concern for people is crucial for leadership success over the long term.3

Both Hersey and Blanchard’s situational theory and Fiedler’s contingency model, discussed in the following sections, use these meta-categories of leadership behavior but apply them based on different sets of contingencies.

HERSEY AND BLANCHARD’S SITUATIONAL THEORY The situational theory developed by Hersey and Blanchard is an interesting exten- sion of the leadership grid outlined in Chapter 2. This approach focuses on the characteristics of followers as the most important element of the situation and

EXHIBIT 3.2 Meta-Categories of Leader Behavior and Four Leader Styles

Source: Based on Gary Yukl, Angela Gordon, and Tom Taber, “A Hierarchical Taxonomy of Leadership Behavior: Integrating a Half Century of Behavior Research,” Journal of Leadership and Organization Studies 9, no. 1 (2002), pp. 15–32 and Gary Yukl, “Effective Leadership Behavior: What We Know and What Questions Need More Attention,” Academy of Management Perspectives (November 2012), pp. 66–81.

Can you adapt your leadership style to followers and the situa- tion? Check out CengageNOW

to complete the question- naire “Is Your Style Flexible?”

NEW LEADER ACTION MEMO Complete the questionnaire in Leader’s Self-Insight 3.1 to assess your relative emphasis on two important categories of leadership behavior.

68 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Situational theory Hersey and Blanchard’s extension of the Leadership Grid focusing on the characteristics of followers as the important element of the situation, and conse- quently, of determining effective leader behavior

consequently of determining effective leader behavior. The point of Hersey and Blanchard’s theory is that subordinates vary in readiness level. People low in task readiness, because of little ability or training, or insecurity, need a different leader- ship style than those who are high in readiness and have good ability, skills, confi- dence, and willingness to work.4

Leader Style According to the situational theory, a leader can adopt one of four leadership styles, based on a combination of relationship (concern for people) and task (concern for production) behavior. The appropriate style depends on the readiness level of followers.

Exhibit 3.3 summarizes the relationship between leader style and follower read- iness. The four leader styles are directing, coaching, supporting, and entrusting. The directing style (S1) reflects a high concern for tasks and a low concern for people and relationships, as shown in the exhibit. The leader provides detailed objectives and explicit instructions about how tasks should be accomplished. The coaching

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C a CLEADER’S SELF-INSIGHT 3.1

T–P Leadership Questionnaire: An Assessment of Style

Instructions: The following items describe aspects of leadership behavior. Assume you are the appointed leader of a student group and feel the pressure for performance improvements to succeed. Respond to each item according to the way you would most likely act in this pressure situation. Indicate whether each item below is Mostly False or Mostly True for you as a work-group leader.

Mostly False

Mostly True

1. I would hold members personally accountable for their performance.

2. I would assign members to specific roles and tasks.

3. I would ask the members to work harder.

4. I would check on people to know how they are doing.

5. I would focus more on execution than on being pleasant with members.

6. I would try to make members’ work more pleasant.

7. I would focus on maintaining a pleasant atmosphere on the team.

8. I would let members do their work the way they think best.

9. I would be concerned with people’s personal feelings and welfare.

10. I would go out of my way to be helpful to members.

Scoring and Interpretation The T–P Leadership Questionnaire is scored as follows: Your “T” score represents task orientation and is the num- ber of Mostly True answers for questions 1–5. Your “P” score represents your people or relationship orientation and is the number of Mostly True answers for questions 6–10. A score of 4 or 5 would be considered high for either T or P. A score of 0 or 1 would be considered low. T ___. P ___.

Some leaders focus on people needs, leaving task concerns to followers. Other leaders focus on task details with the expectation that followers will carry out instruc- tions. Depending on the situation, both approaches may be effective. The important issue is the ability to identify relevant dimensions of the situation and behave accord- ingly. Through this questionnaire, you can identify your relative emphasis on the two dimensions of task orientation (T) and people orientation (P). These are not opposite approaches, and an individual can rate high or low on either or both.

What is your leadership orientation? Compare your results from this assignment to your result from the quiz in Leader’s Self-Insight 2.2 in the previous chapter. What would you consider an ideal leader situation for your style?

Source: Based on the T–P Leadership Questionnaire as published in “Toward a Particularistic Approach to Leadership Style: Some Findings,” by T. J. Sergiovanni, R. Metzcus, and L. Burden, American Educational Research Journal 6, no. 1 (1969), pp. 62–79.

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style (S2) is based on a high concern for both relationships and tasks. With this approach, the leader both provides task instruction and personal support, explains decisions, and gives followers a chance to ask questions and gain clarity about work tasks. The supporting style (S3) is characterized by high relationship and low task behavior. The leader encourages participation, consults with followers, and facilitates decision making. The fourth style, the entrusting style (S4), reflects a low concern for both tasks and relationships. This leader provides little direction or support because complete responsibility for decisions and their implementation is turned over to followers.

Follower Readiness Contingency The lower part of each of the four boxes in Exhibit 3.3 indicates when each leader style should be used. The important contingency is the follower’s readiness level. The essence of Hersey and Blanchard’s situational theory is for the leader to diag- nose a follower’s readiness and select a style that is appropriate for the readiness level, such as the follower’s degree of education and skills, experience, self- confidence, and work attitudes.

EXHIBIT 3.3 The Situational Model of Leadership

Sources: Based on Gary Yukl, Angela Gordon, and Tom Taber, “A Hierarchical Taxonomy of Leadership Behavior: Integrating a Half Century of Behavior Research,“ Journal of Leadership and Organizational Studies 9, no 1 (2002), pp. 15–32; and Paul Hersey, Kenneth Blanchard and Dewey Johnson, Management of Organizational Behavior: Utilizing Human Resources, 7th Ed (Upper Saddle River, NJ: Prentice Hall, 1996).

70 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Low Readiness Contingency When one or more followers exhibit very low levels of readiness, the leader has to use a directing style, telling followers exactly what to do, directing them in how to do it, and specifying timelines. For exam- ple, Phil Hagans owns two McDonald’s franchises in northeast Houston and gives many young workers their first job. He uses a telling style regarding everything from how to dress to the correct way to clean the grill, giving young workers the strong direction they need to develop to higher levels of skill and self-confidence.5

Moderate Readiness Contingency A coaching leadership style works well when followers lack some skills or experience for the job but demonstrate confidence, ability, and willingness to learn. With a coaching style, the leader gives some direc- tion but also explains decisions and clarifies tasks for followers rather than merely instructing how tasks should be performed. Sheryl Sandberg uses a coaching style as chief operating officer at Facebook. Many Facebook employees are fresh out of college with little experience, but they are energetic, enthusiastic, and committed. Sandberg’s style combines decisive leadership with persuasion and consensus build- ing. She uses logic and data to explain her decisions, but she also seeks input and feedback from employees. She describes herself as a leader who tends to “mentor and demand at the same time.”6

High Readiness Contingency A supporting style can be effective when followers have the necessary education, skills, and experience but might be insecure in their abilities and need some encouragement from the leader. The leader can guide fol- lowers’ development and act as a resource for advice and assistance. An example of the participating style is Eric Brevig, a visual-effects supervisor with Industrial Light and Magic, who maximizes the creativity of artists and animators by encouraging participation. Rather than telling people how to do their jobs, Brevig presents them with a challenge and works with them to figure out the best way to meet it.7

Very High Readiness Contingency The entrusting style of leadership can be effec- tively used when followers have very high levels of ability, experience, confidence, and readiness to accept responsibility for their own task behavior. The leader pro- vides a general goal and sufficient authority to do the tasks as followers see fit. Highly educated professionals such as lawyers, college professors, and social work- ers would typically fall into this category. There are followers in almost every orga- nization who demonstrate very high readiness.

In summary, the directing style (S1) works best for followers who demonstrate very low levels of readiness to take responsibility for their own task behavior, the coaching style (S2) is effective for followers with moderate readiness, the supporting style (S3) works well for followers with high readiness, and the entrusting style (S4) is appropriate for followers with very high readiness. In today’s multigenerational workplace, with people of widely different ages and readiness levels working side by side, many leaders find that they have to use multiple styles. Aaron Brown supervises a team at IBM that includes employees who span four decades in age, have work experience of between 3 and 30 years, and have varied attitudes, expec- tations, and ways of working.8 For Brown, getting the best performance out of employees who differ so widely is as challenging—and as energizing—as coping with today’s faster, more competitive business landscape.

NEW LEADER ACTION MEMO As a leader, you can tell followers how to perform their tasks if they have few skills, little experience, or low self-confidence. If followers have a moderate degree of skill and show enthusiasm and willing- ness to learn, provide direction but seek followers’ input and explain your decisions.

NEW LEADER ACTION MEMO As a leader, you can act as a resource to provide advice and guidance when followers have a high level of skill, experience, and responsibility. Delegate responsibility for decisions and their implementation to fol- lowers who have very high levels of skill and positive attitudes.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 71

Hersey and Blanchard’s contingency model focuses only on the characteristics of followers, not those of the larger situation. The leader should evaluate subordi- nates and adopt whichever style is needed. Using an inappropriate style can hurt morale and performance, as illustrated by the following example.

IN THE LEAD Janette Sadik-Khan, New York City Transportation Commissioner Since being appointed transportation commissioner by Mayor Michael R. Bloomberg in 2007, Janette Sadik-Khan has earned international acclaim for transforming the congested streets of New York City by directing the installation of more than 250 miles of bicycle lanes, the creation of pedestrian plazas, and the deletion of parking spots. However, her style in doing it has created conflict and outright hostility among some City Council members, neighborhood leaders, and others.

As described in a New York Times article, Sadik-Khan has used a primarily directing style with followers who could be considered to be at high or very high readiness levels. Her style hasn’t gone over so well. “Even if one appreciates some of Janette’s goals, it’s clear the approach has been very alienating all over the city,” said Bill de Blasio, the city’s public advocate. City Council members and neighborhood leaders, who consider themselves partners who should have a say in how things are done, have called her “dismissive and confrontational.”

Her brash style and reluctance to compromise have created a tough environment in which city leaders will try to accomplish their future goals. Sadik-Khan’s style, which seemed so effective at first, may have become a liability. Mayor Bloomberg and even Sadik-Khan her- self admit that she hasn’t done a good job of listening and collaborating, which has created resentment and made future changes more difficult to implement. “She has an absolute cer- tainty that she’s correct,” said one council member. “I guess it’s nice to go through life with that kind of certainty, but I don’t know if it’s appropriate in government.”9

Sadik-Khan says she has made mistakes because she is so passionate about her goals for the city, but she is trying to be less aggressive and more conciliatory and do a better job of communicating.

In the Hersey–Blanchard model, leaders can tailor their approach to individual subordinates, similar to the leader–member exchange theory described in Chapter 2. If one follower is at a low level of readiness, the leader must be very specific, telling people exactly what to do, how to do it, and when. For a follower high in readiness, the leader provides a general goal and sufficient authority to do the task as the fol- lower sees fit. Leaders can carefully diagnose the readiness level of followers and then apply the appropriate style.

FIEDLER’S CONTINGENCY MODEL Fiedler and his associates developed a model that takes not only followers but other elements of the situation into consideration.10 Although the model is somewhat complicated, the basic idea is simple: Match the leader’s style with the situation most favorable for his or her success. Fiedler’s contingency model was designed to enable leaders to diagnose both leadership style and organizational situation.

NEW LEADER ACTION MEMO Answer the questions in Lea- der’s Self-Insight 3.2 to deter- mine your own readiness level and the style of leadership that would be most appropriate for you as a follower.

72 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Fiedler’s contingency model a model designed to diag- nose whether a leader is task-oriented or relationship- oriented and match leader style to the situation

Leadership Style The cornerstone of Fiedler’s theory is the extent to which the leader’s style is relationship-oriented or task-oriented. A relationship-oriented leader is concerned with people. As with the consideration style described in Chapter 2, a relationship- oriented leader establishes mutual trust and respect and listens to employees’ needs. A task-oriented leader is primarily motivated by task accomplishment. Similar to the initiating structure style described in Chapter 2, a task-oriented leader provides clear directions and sets performance standards.

Leadership style was measured with a questionnaire known as the least pre- ferred coworker (LPC) scale. The LPC scale has a set of 16 bipolar adjectives along an eight-point scale. Examples of the bipolar adjectives used by Fiedler on the LPC scale follow:

open quarrelsome efficient self-assured gloomy

guarded harmonious inefficient hesitant cheerful

If the leader describes the least preferred coworker using positive concepts, he or she is considered relationship-oriented, that is, a leader who cares about and is sensitive to other people’s feelings. Conversely, if a leader uses negative concepts to describe the least preferred coworker, he or she is considered task-oriented, that is, a leader who sees other people in negative terms and places greater value on task activities than on people.

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C a CLEADER’S SELF-INSIGHT 3.2

Are You Ready?

Instructions: A leader’s style can be contingent upon the readiness level of followers. Think of yourself working in your current or former job. Answer the questions below based on how you are on that job. Please answer whether each item is Mostly False or Mostly True for you in that job.

Mostly False

Mostly True

1. I typically do the exact work required of me, nothing more or less.

2. I am often bored and uninterested in the tasks I have to perform.

3. I take extended breaks whenever I can.

4. I have great interest and enthusi- asm for the job.

5. I am recognized as an expert by colleagues and coworkers.

6. I have a need to perform to the best of my ability.

7. I have a great deal of relevant education and experience for this type of work.

8. I am involved in “extra-work” activities such as committees.

9. I prioritize my work and manage my time well.

Scoring and Interpretation In the situational theory of leadership, the higher the fol- lower’s readiness, the more participative and delegating the leader can be. Give yourself one point for each Mostly False answer to items 1–3 and one point for each Mostly True answer to items 4–9. A score of 8–9 points would sug- gest a “very high” readiness level. A score of 7–8 points would indicate a “high” readiness level. A score of 4–6 points would suggest “moderate” readiness, and 0–3 points would indicate “low” readiness. What is the appropriate leadership style for your readiness level? What leadership style did your supervisor use with you? What do you think accounted for your supervisor’s style? Discuss your results with other students to explore which leadership styles are actually used with subordinates who are at different readi- ness levels.

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Situation Fiedler’s model presents the leadership situation in terms of three key elements that can be either favorable or unfavorable to a leader: the quality of leader–member relations, task structure, and position power.

Leader–member relations refers to group atmosphere and members’ attitudes toward and acceptance of the leader. When subordinates trust, respect, and have confidence in the leader, leader–member relations are considered good. When subordinates distrust, do not respect, and have little confidence in the leader, leader–member relations are poor.

Task structure refers to the extent to which tasks performed by the group are defined, involve specific procedures, and have clear, explicit goals. Routine, well-defined tasks, such as those of assembly-line workers, have a high degree of structure. Creative, ill-defined tasks, such as research and development or strate- gic planning, have a low degree of task structure. When task structure is high, the situation is considered favorable to the leader; when low, the situation is less favorable.

Position power is the extent to which the leader has formal authority over subordinates. Position power is high when the leader has the power to plan and direct the work of subordinates, evaluate it, and reward or punish them. Position power is low when the leader has little authority over subordinates and cannot evaluate their work or reward them. When position power is high, the situation is considered favorable for the leader; when low, the situation is unfavorable.

When leader-member relations are good, task structure is high, and position power is strong, the situation is considered highly favorable to the leader. When leader–member relations are poor, task structure is low, and leader position power is weak, the situation is considered highly unfavorable to the leader. The situation would be considered moderately favorable when some of the three elements are high and others low. That is, a leader might have strong position power but tasks are unstructured and leader-member relations are poor. Or, leader-member rela- tions might be good, but position power is weak and tasks are unstructured. There can be various levels of moderate favorability based on various combinations of the three key elements.

Contingency Theory When Fiedler examined the relationships among leadership style, situational favor- ability, and group task performance, he found the pattern shown in Exhibit 3.4. Task-oriented leaders are more effective when the situation is either highly favor- able or highly unfavorable. Relationship-oriented leaders are more effective in situa- tions of moderate favorability.

The task-oriented leader excels in the highly favorable situation because every- one gets along, the task is clear, and the leader has power; all that is needed is for someone to take charge and provide direction. Similarly, if the situation is highly unfavorable to the leader, a great deal of structure and task direction is needed. A strong leader defines task structure and can establish authority over subordinates. Because leader–member relations are poor anyway, a strong task orientation will make no difference to the leader’s popularity. Consider how Sergio Marchionne’s task-oriented leadership style fit the situation he found at Chrysler.

74 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

IN THE LEAD Sergio Marchionne, Chrysler Group LLC The fate of the smallest of the Big Three U.S. automakers rests in the hands of Italian-born Sergio Marchionne, who rescued Fiat from the brink of collapse a few years ago with his close attention to detail. Marchionne is a strong task-oriented leader. Rather than settling into the top-floor executive suite at Chrysler’s Auburn Hills, Michigan, headquarters, Marchionne chose an office in the fourth-floor engineering center. He carries six smartphones and keeps tabs on the smallest details, down to a faulty door handle on the new Dodge Charger. “If you really want to run the business,” he says, “you need to get involved at this level.”

Marchionne came into a highly unfavorable situation at Chrysler. Like General Motors, Chrysler had to be rescued by a federal bailout several years ago, and Marchionne took charge just after the company emerged from bankruptcy and Fiat assumed part ownership. Sales were slumping, Chrysler’s image was tarnished, morale and motivation was low, costs were high, and operational problems plagued the company. Marchionne became known at Fiat for working long hours, seven days a week, and he told his top executives at Chrysler to plan on doing the same for the foreseeable future. He meets with managers regularly and gives them specific orders for what he wants to see accomplished. Managers who were committed to staying stuck in the old way of doing things were fired.

Chrysler has been slower to bounce back than GM, but Marchionne’s task-oriented leadership is having a positive effect. Sales are improving, and operational problems have been brought under control. In addition, Marchionne’s hard-hitting approach has brought a refreshing energy into the organization, giving employees a greater sense of hope and motivation.11

Sergio Marchionne’s task-oriented style is appropriate for the difficult situation he found at Chrysler. Researchers at the University of Chicago looked at CEOs of companies in turnaround situations—where companies typically have high debt loads and a need to improve results in a hurry—and found that tough-minded, task-focused characteristics such as analytical skills, a focus on efficiency, and set- ting high standards were more valuable leader qualities than were relationship skills such as good communication, listening, and teamwork.12

EXHIBIT 3.4 Fiedler’s Classification: How Leader Style Fits the Situation

Source: Based on Fred E. Fiedler, “The Effects of Leadership Training and Experience: A Contingency Model Interpretation,” Adminis- trative Science Quarterly 17 (1972), p. 455.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 75

The relationship-oriented leader performs better in situations of moderate favorability because human relations skills are important in achieving high group performance. In these situations, the leader may be moderately well liked, have some power, and supervise jobs that contain some ambiguity. A leader with good interpersonal skills can create a positive group atmosphere that will improve rela- tionships, clarify task structure, and establish position power.

A leader, then, needs to know two things in order to use Fiedler’s contingency theory. First, the leader should know whether he or she has a relationship- or task- oriented style. Second, the leader should diagnose the situation and determine whether leader–member relations, task structure, and position power are favorable or unfavorable.

An important contribution of Fiedler’s research is that it goes beyond the notion of leadership styles to try to show how styles fit the situation. Many studies have been conducted to test Fiedler’s model, and the research in general provides some support for the model.13 However, Fiedler’s model has also been criticized.14

Using the LPC score as a measure of relationship- or task-oriented behavior seems simplistic to some researchers, and the weights used to determine situation favor- ability seem to have been determined in an arbitrary manner. In addition, some observers argue that the empirical support for the model is weak because it is based on correlational results that fail to achieve statistical significance in the majority of cases. The model also isn’t clear about how the model works over time. For instance, if a task-oriented leader such as Sergio Marchionne is matched with an unfavorable situation and is successful, the organizational situation is likely to improve, thus becoming a situation more appropriate for a relationship-oriented leader. Will Marchionne’s task-oriented style continue to be effective under more favorable circumstances at Chrysler? Can or should he try to shift to a more relationship-oriented leader style? Fiedler’s model doesn’t address this issue.

Finally, Fiedler’s model and much of the subsequent research fail to consider medium LPC leaders, who some studies indicate are more effective than either high or low LPC leaders in a majority of situations.15 Leaders who score in the mid-range on the LPC scale presumably balance the concern for relationships with a concern for task achievement more effectively than high or low LPC leaders, mak- ing them more adaptable to a variety of situations.

New research has continued to improve Fiedler’s model,16 and it is still consid- ered an important contribution to leadership studies. However, its major impact may have been to stir other researchers to consider situational factors more seri- ously. A number of other situational theories have been developed in the years since Fiedler’s original research.

PATH–GOAL THEORY According to the path–goal theory, the leader’s responsibility is to increase subordi- nates’ motivation to attain personal and organizational goals.17 As illustrated in Exhibit 3.5, the leader increases follower motivation by either (1) clarifying the follower’s path to the rewards that are available or (2) increasing the rewards that the follower values and desires. Path clarification means that the leader works with subordinates to help them identify and learn the behaviors that will lead to successful task accomplishment and organizational rewards. Increasing rewards means that the leader talks with subordinates to learn which rewards are important to them—that is,

NEW LEADER ACTION MEMO As a leader, you can effectively use a task-oriented style when the organizational situation is either highly unfavorable or highly favorable to you as a leader. Use a relationship- oriented style in situations of moderate favorability because human relations skills can cre- ate a positive atmosphere.

76 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Path–goal theory a contingency approach to leadership in which the leader’s responsibility is to increase subordinates’ motivation by clarifying the behaviors necessary for task accomplishment and rewards

whether they desire intrinsic rewards from the work itself or extrinsic rewards such as raises or promotions. The leader’s job is to increase personal payoffs to subordinates for goal attainment and to make the paths to these payoffs clear and easy to travel.18

This model is called a contingency theory because it consists of three sets of contingencies—leader style, followers and situation, and the rewards to meet fol- lowers’ needs.19 Whereas the Fiedler theory made the assumption that new leaders could take over as situations change, in the path–goal theory, leaders change their behaviors to match the situation.

Leader Behavior The path–goal theory suggests a fourfold classification of leader behaviors.20 These classifications are the types of behavior the leader can adopt and include support- ive, directive, achievement-oriented, and participative styles.

Supportive leadership shows concern for subordinates’ well-being and personal needs. Leadership behavior is open, friendly, and approachable, and the leader cre- ates a team climate and treats subordinates as equals. Supportive leadership is simi- lar to the consideration or people-oriented leadership described earlier. An example is Jay Goltz, an entrepreneur who owns five small businesses in Chicago, who has always used supportive leadership. He has loaned money to employees,

EXHIBIT 3.5 Leader Roles in the Path–Goal Model

NEW LEADER ACTION MEMO As a leader, you can increase follower motivation, satisfac- tion, and performance by adopting a leadership behavior that will clarify the follower’s path to receiving available rewards or increase the availability of rewards the follower desires.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 77

guaranteed car loans, helped several employees buy houses, and even bailed a cou- ple of employees out of jail.21

Directive leadership tells subordinates exactly what they are supposed to do. Leader behavior includes planning, making schedules, setting performance goals and behavior standards, and stressing adherence to rules and regulations. Directive leadership behavior is similar to the initiating structure or task-oriented leadership style described earlier.

Participative leadership consults with subordinates about decisions. Leader behavior includes asking for opinions and suggestions, encouraging participation in decision making, and meeting with subordinates in their workplaces. The partici- pative leader encourages group discussion and suggestions, similar to the coaching or supporting style in the Hersey and Blanchard model.

Achievement-oriented leadership sets clear and challenging goals for subordi- nates. Leader behavior stresses high-quality performance and improvement over current performance. Achievement-oriented leaders also show confidence in subor- dinates and assist them in learning how to achieve high goals.

The four types of leader behavior are not considered ingrained personality traits as in the earlier trait theories; rather, they reflect types of behavior that every leader is able to adopt, depending on the situation. Here’s how Alan Robbins, founder of Plastic Lumber Company, shifted from a participative to a directive style and got better results from his employees.

IN THE LEAD Alan Robbins, Plastic Lumber Company Alan Robbins started Plastic Lumber Company because he saw a way to both help the planet and make money by converting plastic milk and soda bottles into fake lumber. He also had definite ideas about how to run a company. Robbins wanted to be both a boss and a friend to his employees. His leadership style stressed teamwork and participation, and Robbins spent a lot of time running ideas by workers on the factory floor. However, he soon learned that most of his low-skilled workers didn’t really want a chance to partici- pate; they just wanted clear direction and consistent standards so that people knew what was expected of them.

The degree of freedom Robbins allowed with his participative style actually led to some serious problems. Some workers were frequently absent or late without calling, showed up under the influence of alcohol or drugs, and started fights on the factory floor. Letting employees participate in decision making weakened Robbins’s authority in many employees’ eyes. Those who genuinely wanted to do a good job were frustrated by the lack of order and the fact that some employees seemed to get away with anything.

Even though Robbins had a natural tendency to be a participative leader, he shifted to a directive leadership style to try to restore some order. With a comprehensive rules and policy manual, drug testing for all workers, and clear standards of behavior, the work envi- ronment and employee performance at Plastic Lumber improved significantly.22

Alan Robbins had believed his participative style would be appreciated by employ- ees. However, employee satisfaction increased when he began using a directive style and specifying what was expected and what behaviors would not be tolerated. The directive

The boss drives people; the leader

coaches them. The boss depends on authority; the leader on good

will. The boss in- spires fear; the leader inspires enthusiasm.

H. Gordon Selfridge (1864–1947),

founder of British retailer Selfridges.

78 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

style enabled people to focus on meeting performance standards by following clear pro- cedures and guidelines. Thus, although Robbins would prefer to be participative, he realized it was not the best approach for the situation. The Consider This box provides an interesting perspective on the disadvantages of persisting in a behavior style despite the processes of change.

Situational Contingencies The two important situational contingencies in the path–goal theory are (1) the per- sonal characteristics of group members and (2) the work environment. Personal characteristics of followers are similar to Hersey and Blanchard’s readiness level and include such factors as ability, skills, needs, and motivations. For example, if an employee has a low level of ability or skill, the leader may need to provide addi- tional training or coaching in order for the worker to improve performance. If a subordinate is self-centered, the leader may use monetary rewards to motivate him or her. Subordinates who want or need clear direction and authority require a directive leader to tell them exactly what to do. Craft workers and professionals, however, may want more freedom and autonomy and work best under a participa- tive leadership style.

The work environment contingencies include the degree of task structure, the nature of the formal authority system, and the work group itself. The task structure is similar to the same concept described in Fiedler’s contingency theory; it includes

Consider

The phrase “too much of a good thing” is relevant in leadership. Behavior that becomes overbearing can be a disadvantage by ultimately resulting in the opposite of what the indi- vidual is hoping to achieve.

Polarities All behavior consists of opposites or polarities. If I do anything more and more, over and over, its polarity will appear. For example, striving to be beautiful makes a person ugly, and trying too hard to be kind is a form of selfishness.

Any overdetermined behavior produces its opposite:

• An obsession with living suggests worry about dying. • True simplicity is not easy. • Is it a long time or a short time since we last met? • The braggart probably feels small and insecure. • Who would be first ends up last.

Knowing how polarities work, the wise leader does not push to make things happen but allows process to unfold on its own.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 79

the extent to which tasks are defined and have explicit job descriptions and work procedures. The formal authority system includes the amount of legitimate power used by leaders and the extent to which policies and rules constrain employees’ behavior. Work-group characteristics consist of the educational level of subordi- nates and the quality of relationships among them.

Use of Rewards Recall that the leader’s responsibility is to clarify the path to rewards for followers or to increase the amount or type of rewards to enhance satisfaction and job perfor- mance. In some situations, the leader works with subordinates to help them acquire the skills and confidence needed to perform tasks and achieve rewards already available. In others, the leader may develop new rewards to meet the specific needs of subordinates.

Exhibit 3.6 illustrates four examples of how leadership behavior is tailored to the situation. In the first situation, the subordinate lacks confidence; thus, the supportive leadership style provides the social support with which to encourage the subordinate to undertake the behavior needed to do the work and receive the rewards. In the second situation, the job is ambiguous, and the employee is not performing effectively. Directive leadership behavior is used to give instruc- tions and clarify the task so that the follower will know how to accomplish it and receive rewards. In the third situation, the subordinate is unchallenged by the task; thus, an achievement-oriented behavior is used to set higher goals. This

EXHIBIT 3.6 Path–Goal Situations and Preferred Leader Behaviors

80 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

clarifies the path to rewards for the employee. In the fourth situation, an incor- rect reward is given to a subordinate, and the participative leadership style is used to change this. By discussing the subordinate’s needs, the leader is able to identify the correct reward for task accomplishment. In all four cases, the out- come of fitting the leadership behavior to the situation produces greater employee effort by either clarifying how subordinates can receive rewards or changing the rewards to fit their needs.

Path–goal theorizing can be complex, but much of the research on it has been encouraging.23 Using the model to specify precise relationships and make exact pre- dictions about employee outcomes may be difficult, but the four types of leader behavior and the ideas for fitting them to situational contingencies provide a useful way for leaders to think about motivating subordinates.

THE VROOM–JAGO CONTINGENCY MODEL The Vroom–Jago contingency model shares some basic principles with the previous models, yet it differs in significant ways as well. This model focuses specifically on varying degrees of participative leadership and how each level of participation influ- ences the quality and accountability of decisions. A number of situational factors shape the likelihood that either a participative or autocratic approach will produce the best outcome.

This model starts with the idea that a leader faces a problem that requires a solution. Decisions to solve the problem might be made by a leader alone or through inclusion of a number of followers.

The Vroom–Jago model is very applied, which means that it tells the leader pre- cisely the correct amount of participation by subordinates to use in making a par- ticular decision.24 The model has three major components: leader participation styles, a set of diagnostic questions with which to analyze a decision situation, and a series of decision rules.

Leader Participation Styles The model employs five levels of subordinate participation in decision making, ranging from highly autocratic (leader decides alone) to highly democratic (leader delegates to group), as illustrated in Exhibit 3.7.25 The exhibit shows five decision styles, starting with the leader making the decision alone (Decide); presenting the problem to subordinates individually for their suggestions and then making the decision (Consult Individually); presenting the problem to subordinates as a group, collectively obtaining their ideas and suggestions, then making the decision (Consult Group); sharing the problem with subordinates as a group and acting as a facilitator to help the group arrive at a decision (Facilitate); or delegating the problem and permitting the group to make the decision within prescribed limits (Delegate). The five styles fall along a continuum, and the leader should select one depending on the situation.

Diagnostic Questions How does a leader decide which of the five decision styles to use? The appropriate degree of decision participation depends on a number of situational factors, such as the required level of decision quality, the level of leader or subordinate expertise, and

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 81

Vroom–Jago contingency model a contingency model that focuses on varying degrees of participative leadership, and how each level of par- ticipation influences quality and accountability of decisions

the importance of having subordinates commit to the decision. Leaders can analyze the appropriate degree of participation by answering seven diagnostic questions.

1. Decision significance: How significant is this decision for the project or organi- zation? If the decision is highly important and a high-quality decision is needed for the success of the project or organization, the leader has to be actively involved.

2. Importance of commitment: How important is subordinate commitment to car- rying out the decision? If implementation requires a high level of commitment to the decision, leaders should involve subordinates in the decision process.

3. Leader expertise: What is the level of the leader’s expertise in relation to the problem? If the leader does not have a high amount of information, knowledge, or expertise, the leader should involve subordinates to obtain it.

4. Likelihood of commitment: If the leader were to make the decision alone, would subordinates have high or low commitment to the decision? If subordi- nates typically go along with whatever the leader decides, their involvement in the decision-making process will be less important.

EXHIBIT 3.7 Five Leader Decision Styles

82 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

5. Group support for goals: What is the degree of subordinate support for the team’s or organization’s objectives at stake in this decision? If subordinates have low support for the goals of the organization, the leader should not allow the group to make the decision alone.

6. Goal expertise: What is the level of group members’ knowledge and expertise in relation to the problem? If subordinates have a high level of expertise in rela- tion to the problem, more responsibility for the decision can be delegated to them.

7. Team competence: How skilled and committed are group members to working together as a team to solve problems? When subordinates have high skills and high desire to work together cooperatively to solve problems, more responsibil- ity for the decision making can be delegated to them.

These questions seem detailed, but considering these seven situational factors can quickly narrow the options and point to the appropriate level of group partici- pation in decision making.

Selecting a Decision Style Further development of the Vroom–Jago model added concern for time constraints and concern for follower development as explicit criteria for determining the level of participation. That is, a leader considers the relative importance of time versus follower development in selecting a decision style. This led to the development of two decision matrixes, a time-based model to be used if time is critical, for example if the organization is facing a crisis and a decision must be made immediately, and a development-based model to be used if time and efficiency are less important crite- ria than the opportunity to develop the thinking and decision-making skills of followers.

Consider the example of a small auto parts manufacturer, which owns only one machine for performing welds on mufflers. If the machine has broken down and production has come to a standstill, a decision concerning the purchase of a new machine is critical and has to be made immediately to get the production line mov- ing again. In this case, a leader would follow the time-based model for selecting the decision style. However, if the machine is scheduled for routine replacement in three months, time is not a critical factor. The leader is then free to consider the impor- tance of involving production workers in the decision making to develop their skills. Thus, the leader may follow the development-based model because time is not a critical concern.

Exhibits 3.8 and 3.9 illustrate the two decision matrixes—a timesaving-based model and an employee development–based model—that enable leaders to adopt a participation style by answering the diagnostic questions in sequence. Returning to the example of the welding machine, if the machine has broken down and must be replaced immediately, the leader would follow the timesaving-based model in Exhibit 3.8. The leader enters the matrix at the left side, at Problem Statement. The matrix acts as a funnel as you move left to right, responding to the situational questions across the top, answering high (H) or low (L) to each one, and avoiding crossing any horizontal lines.

The first question (decision significance) would be: How significant is this deci- sion for the project or organization? If the answer is High, the leader proceeds to importance of commitment: How important is subordinate commitment to carrying

NEW LEADER ACTION MEMO As a leader, you can use the Vroom–Jago model to deter- mine the appropriate amount of follower participation to use in making a decision. You can follow the time-based guidelines when time is of the essence but use development- based guidelines when cultivating followers’ decision- making skills is also important.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 83

out the decision? If the answer is High, the next question pertains to leader exper- tise: What is the level of the leader’s expertise in relation to the problem? If the lea- der’s knowledge and expertise is High, the leader next considers likelihood of commitment: If the leader were to make the decision alone, how likely is it that

EXHIBIT 3.8 Timesaving-Based Model for Determining an Appropriate Decision-Making Style—Group Problems

84 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

subordinates would be committed to the decision? If there is a high likelihood that subordinates would be committed, the decision matrix leads directly to the Decide style of decision making, in which the leader makes the decision alone and presents it to the group.

As noted earlier, this matrix assumes that time and efficiency are the most important criteria. However, consider how the selection of a decision style would differ if the leader had several months to replace the welding machine and consid- ered follower development of high importance and time of little concern. In this case, the leader would follow the employee development–driven decision matrix in Exhibit 3.9. Beginning again at the left side of the matrix: How significant is this

EXHIBIT 3.9 Employee Development–Based Model for Determining an Appropriate Decision-Making Style—Group Problems

Source: Victor H. Vroom, “Leadership and the Decision-Making Process,” Organizational Dynamics 28, no. 4 (Spring 2000), pp. 82–94. This is Vroom’s adaptation of Tannenbaum and Schmidt’s Taxonomy.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 85

decision for the project or organization? If the answer is High, proceed to impor- tance of commitment: How important is subordinate commitment? If high, the next question concerns likelihood of commitment (leader expertise is not considered because the development model is focused on involving subordinates, even if the leader has knowledge and expertise): If the leader were to make the decision alone, how likely is it that subordinates would be committed to the decision? If there is a high likelihood, the leader next considers group support: What is the degree of subordinate support for the team’s or organization’s objectives at stake in this decision? If the degree of support for goals is low, the leader would proceed directly to the Group Consult decision style. However, if the degree of support for goals is high, the leader would then ask: What is the level of group members’ knowledge and expertise in relation to the problem? An answer of High would take the leader to the question: How skilled and committed are group members to working together as a team to solve problems? An answer of High would lead to the Delegate style, in which the leader allows the group to make the decision within certain limits.

Note that the timesaving-driven model takes the leader to the first decision style that preserves decision quality and follower acceptance, whereas the employee development–driven model takes other considerations into account. It takes less time to make an autocratic decision (Decide) than to involve subordi- nates by using a Facilitate or Delegate style. However, in many cases, time and efficiency are less important than the opportunity to further subordinate devel- opment. In many of today’s organizations, where knowledge sharing and wide- spread participation are considered critical to organizational success, leaders are placing greater emphasis on follower development when time is not a critical issue.

Leaders can quickly learn to use the model to adapt their styles to fit the situa- tion. However, researchers have also developed a computer-based program that allows for greater complexity and precision in the Vroom–Jago model and incorpo- rates the value of time and value of follower development as situational factors rather than portraying them in separate decision matrixes.

The Vroom–Jago model has been criticized as being less than perfect,26 but it is useful to decision makers, and the model is supported by research.27 Leaders can learn to use the model to make timely, high-quality decisions. Let’s try applying the model to the following problem.

IN THE LEAD Art Weinstein, Whitlock Manufacturing When Whitlock Manufacturing won a contract from a large auto manufacturer to produce an engine to power its flagship sports car, Art Weinstein was thrilled to be selected as proj- ect manager. The engine, of Japanese design and extremely complex, has gotten rave reviews in the automotive press. This project has dramatically enhanced the reputation of Whitlock Manufacturing, which was previously known primarily as a producer of outboard engines for marine use.

Weinstein and his team of engineers have taken great pride in their work on the proj- ect, but their excitement was dashed by a recent report of serious engine problems in cars delivered to customers. Fourteen owners of cars produced during the first month had

86 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

experienced engine seizures. Taking quick action, the auto manufacturer suspended sales of the sports car, halted current production, and notified owners of the current model not to drive the car. Everyone involved knows this is a disaster. Unless the engine problem is solved quickly, Whitlock Manufacturing could be exposed to extended litigation. In addition, Whitlock’s valued relationship with one of the world’s largest auto manufacturers would probably be lost forever.

As the person most knowledgeable about the engine, Weinstein has spent two weeks in the field inspecting the seized engines and the auto plant where they were installed. In addition, he has carefully examined the operations and practices in Whitlock’s plant where the engine is manufactured. Based on this extensive research, Weinstein is convinced that he knows what the problem is and the best way to solve it. However, his natural inclination is to involve other team members as much as possible in making decisions and solving pro- blems. He not only values their input, but he also thinks that by encouraging greater partic- ipation he strengthens the thinking skills of team members, helping them grow and contribute more to the team and the organization. Therefore, Weinstein chooses to consult with his team before making his final decision.

The group meets for several hours that afternoon, discussing the problem in detail and sharing their varied perspectives, including the information Weinstein has gathered during his research. Following the group session, Weinstein makes his decision. He will present the decision at the team meeting the following morning, after which testing and correction of the engine problem will begin.28

In the Whitlock Manufacturing case, either a timesaving-based or an employee development–based model can be used to select a decision style. Although time is of importance, the leader’s desire to involve subordinates can be considered equally important. Do you think Weinstein used the correct leader decision style? Let’s examine the problem using the employee development–based decision tree since Weinstein is concerned about involving other team members. Moving from left to right in Exhibit 3.9, the questions and answers are as follows: How significant is this decision for the organization? Definitely High. Quality of the decision is of critical importance. The company’s future may be at stake. How important is subor- dinate commitment to carrying out the decision? Also High. The team members must support and implement Weinstein’s solution. Question 3 (leader expertise) is not considered in the employee development–driven model, as shown in Exhibit 3.9. The next question would be If Weinstein makes the decision on his own, will team members have high or low commitment to it? The answer to this question is probably also High. Team members respect Weinstein, and they are likely to accept his analysis of the problem. This leads to the question What is the degree of subordinate support for the team’s or organization’s objectives at stake in this decision? The answer, definitely High, leads to the question What is the level of group members’ knowledge and expertise in relation to the problem? The answer to this question is probably Low, which leads to the Consult Group decision style. Thus, Weinstein used the style that would be recommended by the Vroom–Jago model.

Now, assume that Weinstein chose to place more emphasis on efficient use of time than on employee involvement and development. Using the timesaving-based decision matrix in Exhibit 3.8, answer the questions across the top of the matrix based on the information just provided (rate Weinstein’s level of expertise in

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 87

Question 3 as high). Remember to avoid crossing any horizontal lines. What deci- sion style is recommended? Is it the same as or different from that recommended by the employee development–based tree?

SUBSTITUTES FOR LEADERSHIP The contingency leadership approaches considered so far have focused on the lea- der’s style, the followers’ nature, and the situation’s characteristics. The final con- tingency approach suggests that situational variables can be so powerful that they actually substitute for or neutralize the need for leadership.29 This approach out- lines those organizational settings in which task-oriented and people-oriented lead- ership styles are unimportant or unnecessary.

Exhibit 3.10 shows the situational variables that tend to substitute for or neu- tralize leadership characteristics. A substitute for leadership makes the leadership style unnecessary or redundant. For example, highly educated, professional subordi- nates who know how to do their tasks do not need a leader who initiates structure for them and tells them what to do. In addition, long-term education often develops autonomous, self-motivated individuals. Thus, task-oriented and people-oriented leadership is substituted by professional education and socialization.30

Daniel Snyder, owner of the Washington Redskins football team, discovered that his strong task-oriented approach with his professional, talented coaches was counterproductive.

IN THE LEAD Daniel Snyder, Washington Redskins For many of Daniel Snyder’s 14 years as owner of the Washington Redskins, he had a reputation as a meddlesome, overbearing boss who got in the way of people doing their jobs. He got involved in every detail of the team, even making big decisions on player acquisition himself.

EXHIBIT 3.10 Substitutes and Neutralizers for Leadership

Variable Task-Oriented Leadership

People-Oriented Leadership

Organizational variables Group cohesiveness Formalization Inflexibility Low position power

Substitutes for Substitutes for Neutralizes Neutralizes

Substitutes for No effect on No effect on Neutralizes

Task characteristics Highly structured task Automatic feedback Intrinsic satisfaction

Substitutes for Substitutes for No effect on

No effect on No effect on Substitutes for

Follower characteristics Professionalism Training/experience Low value of rewards

Substitutes for Substitutes for Neutralizes

Substitutes for No effect on Neutralizes

NEW LEADER ACTION MEMO As a leader, you can avoid leadership overkill. Adopt a style that is complementary to the organizational situation to ensure that both task needs and people needs are met.

Substitute a situational variable that makes leadership unneces- sary or redundant

88 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

But Snyder has proven that leaders can change. “He’s stepped back from it,” one insider says. “And he’s having more fun because of it.” Some associates say Snyder finally was able to step back because he got tired of all the losses the team racked up—and the criticism he got from fans and the media because of them.

Since Snyder has remained in the background, the team has been winning. In 2012, the Redskins won their first NFC East division title since 1999, Snyder’s first season as owner. “I think he deserves a lot of credit,” said former general manager Charley Casserly, whom Snyder fired in 1999. “He’s allowed them to do their jobs. They’ve turned the fran- chise around and made it a winner again.”31

At the Washington Redskins, the skills, training, experience, and professional- ism of coaches substituted for a task-oriented leadership style of the owner and also made a people-oriented style less important. Daniel Snyder has been able to stay on the sidelines and let his coaches and players win football games.

Unlike a substitute, a neutralizer counteracts the leadership style and prevents the leader from displaying certain behaviors. For example, if a leader is physically removed from subordinates, the leader’s ability to give directions to subordinates is greatly reduced. FedEx Office (formerly Kinko’s) provides an example. With numerous locations widely scattered across regions, regional managers have very limited personal interaction with store managers and employees. Thus, their ability to both support and direct is neutralized.

Situational variables in Exhibit 3.10 include characteristics of the followers, the task, and the organization itself. For example, when subordinates are highly professional, such as research scientists in companies like Merck or Monsanto, both leadership styles are less important. The employees do not need either direc- tion or support. With respect to task characteristics, highly structured tasks sub- stitute for a task-oriented style, and a satisfying task substitutes for a people- oriented style.

When a task is highly structured and routine, like auditing cash, the leader should provide personal consideration and support that is not provided by the task. Satisfied people don’t need as much consideration. Likewise, with respect to the organization itself, group cohesiveness substitutes for both leader styles. For example, the relationship that develops among air traffic controllers and jet fighter pilots is characterized by high-stress interactions and continuous peer training. This cohesiveness provides support and direction that substitute for formal leadership.32

Formalized rules and procedures substitute for leader task orientation because the rules tell people what to do. Physical separation of leader and subordinate neutra- lizes both leadership styles.

The value of the situations described in Exhibit 3.10 is that they help leaders avoid leadership overkill. Leaders should adopt a style with which to complement the organizational situation. For example, the work situation for bank tellers pro- vides a high level of formalization, little flexibility, and a highly structured task. The head teller should not adopt a task-oriented style because the organization already provides structure and direction. The head teller should concentrate on a people- oriented style. In other organizations, if group cohesiveness or previous training meets employee social needs, the leader is free to concentrate on task-oriented beha- viors. The leader can adopt a style complementary to the organizational situation to ensure that both task needs and people needs of followers are met.

NEW LEADER ACTION MEMO Measure how the task charac- teristics of your job or a job you’ve held in the past might act as substitutes for leadership by answering the questions in Leader’s Self-Insight 3.3.

NEW LEADER ACTION MEMO As a leader, you can use a people-oriented style when tasks are highly structured and followers are bound by formal rules and procedures. You can adopt a task-oriented style if group cohesiveness and fol- lowers’ intrinsic job satisfaction meet their social and emo- tional needs.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 89

Neutralizer a situational characteristic that counteracts the leader- ship style and prevents the leader from displaying cer- tain behaviors

Studies have examined how substitutes (the situation) can be designed to have more impact than leader behaviors on outcomes such as subordinate satisfaction.33

The impetus behind this research is the idea that substitutes for leadership can be designed into organizations in ways to complement existing leadership, act in the absence of leadership, and otherwise provide more comprehensive leadership alter- natives. For example, Paul Reeves, a foreman at Harmon Auto Parts, shared half- days with his subordinates during which they helped him perform his leader tasks. After Reeves’s promotion to middle management, his group no longer required a foreman. Followers were trained to act on their own.34 Thus, a situation in which follower ability and training were highly developed created a substitute for leadership.

The ability to use substitutes to fill leadership “gaps” is often advantageous to organizations. Indeed, the fundamental assumption of substitutes-for-leadership

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 3.3

Measuring Substitutes for Leadership

Instructions: Think about your current job or a job you have held in the past. Please answer whether each item below is Mostly False or Mostly True for you in that job.

Mostly False

Mostly True

1. Because of the nature of the tasks I perform, there is little doubt about the best way to do them.

2. My job duties are so simple that almost anyone could perform them well after a little instruction.

3. It is difficult to figure out the best way to do many of my tasks and activities.

4. There is really only one correct way to perform most of the tasks I do.

5. After I’ve completed a task, I can tell right away from the results I get whether I have performed it correctly.

6. My job is the kind where you can finish a task and not know if you’ve made a mistake or error.

7. Because of the nature of the tasks I do, it is easy for me to see when I have done something excep- tionally well.

8. I get lots of satisfaction from the work I do.

9. It is hard to imagine that anyone could enjoy performing the tasks I have performed on my job.

10. My job satisfaction depends pri- marily on the nature of the tasks and activities I perform.

Scoring and Interpretation For your task structure score, give yourself one point for Mostly True answers to items 1, 2, and 4, and for a Mostly False answer to item 3. This is your score for Task Structure: ___

For your task feedback score, give yourself one point for Mostly True answers to items 5 and 7, and for a Mostly False answer to item 6. This is your score for Task Feedback: ___

For your intrinsic satisfaction score, score one point for Mostly True answers to items 8 and 10, and for a Mostly False answer to item 9. This is your score for Intrinsic Satis- faction: ___

A high score (3 or 4) for Task Structure or Task Feed- back indicates a high potential for those elements to act as a substitute for task-oriented leadership. A high score (3) for Intrinsic Satisfaction indicates the potential to be a substi- tute for people-oriented leadership. Does your leader adopt a style that is complementary to the task situation, or is the leader guilty of leadership overkill? How can you apply this understanding to your own actions as a leader?

Source: Based on “Questionnaire Items for the Measurement of Substitutes for Leadership,” Table 2 in Steven Kerr and John M. Jermier, “Substitutes for Leadership: Their Meaning and Measurement,” Organizational Behavior and Human Performance 22 (1978), pp. 375–403.

| D re am

st im e. co m

NEW LEADER ACTION MEMO As a leader, you can provide minimal task direction and personal support to highly trained employees; followers’ professionalism and intrinsic satisfaction substitute for both task- and people-oriented leadership.

90 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

researchers is that effective leadership is the ability to recognize and provide the support and direction not already provided by task, group, and organization.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • The most important point in this chapter is that situational variables affect

leadership outcomes. The contingency approaches were developed to systemati- cally address the relationship between a leader and the organization. The contingency approaches focus on how the components of leadership style, subordinate characteristics, and situational elements impact one another. Hersey and Blanchard’s situational theory, Fiedler’s contingency model, the path–goal theory, the Vroom–Jago model, and the substitutes-for-leadership concept each examine how different situations call for different styles of leader- ship behavior.

• Hersey and Blanchard contend that leaders can adjust their task or relationship style to accommodate the readiness level of their subordinates. According to Fiedler, leaders can determine whether their leadership style is suitable for the situation. Task-oriented leaders tend to do better in very favorable or very unfavorable situations, whereas relationship-oriented leaders do best in situations of intermediate favorability. The path–goal theory states that leaders can use a style that appropriately clarifies the path to desired rewards. The Vroom–Jago model indicates that leaders can choose a participative decision style based on contingencies such as quality requirement, commitment require- ment, or the leader’s knowledge and expertise. In addition, concern for time (the need for a fast decision) versus concern for follower development is taken into account. Finally, the substitutes-for-leadership concept recommends that leaders adjust their style to provide resources not otherwise provided in the organizational situation.

• By discerning the characteristics of tasks, subordinates, and organizations, leaders can determine the style that increases the likelihood of successful leader- ship outcomes. Therefore, effective leadership depends partly on developing diagnostic skills and being flexible in your leadership behavior.

DISCUSSION QUESTIONS 1. Consider Fiedler’s theory as illustrated in Exhibit 3.4. How often do you think very

favorable, intermediate, or very unfavorable situations occur to leaders in real life? Discuss.

2. Do you think leadership style is fixed and unchangeable, or can leaders be flexible and adaptable with respect to style? Why?

3. Consider the leadership position of the managing partner in a law firm. What task, subordinate, and organizational factors might serve as substitutes for leadership in this situation?

4. Compare Fiedler’s contingency model with the path–goal theory. What are the similarities and differences? Which do you prefer?

Tw itt er

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 91

5. If you were a first-level supervisor of a team of telemarketers, how would you go about assessing the readiness level of your subordinates? Do you think most leaders are able to easily shift their leadership style to suit the readiness level of followers?

6. Think back to teachers you have had, and identify one each who fits a supportive style, directive style, participative style, and achievement-oriented style according to the path– goal theory. Which style did you find most effective? Why?

7. Do you think leaders should decide on a participative style based on the most efficient way to reach the decision? Should leaders sometimes let people participate for other reasons?

8. Consider the situational characteristics of group cohesiveness, organizational formaliza- tion, and physical separation. How might each of these substitute for or neutralize task- oriented or people-oriented leadership? Explain.

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LEADERSHIP AT WORK Task versus Relationship Role Play You are the new distribution manager for French Grains Bakery. Five drivers who deliver French Grains baked goods to grocery stores in the metropolitan area report to you. The dri- vers are expected to complete the delivery report to keep track of actual deliveries and any changes that occur. The delivery report is a key element in inventory control and provides the data for French Grains invoicing of grocery stores. Errors become excessive when drivers fail to complete the report each day, especially when store managers request different inven- tory when the driver arrives. As a result, French Grains may not be paid for several loaves of bread a day for each mistake in the delivery report. The result is lost revenue and poor inventory control.

One of the drivers accounts for about 60 percent of the errors in the delivery reports. This driver is a nice person and generally reliable, although he is occasionally late for work. His major problem is that he falls behind in his paperwork. A second driver accounts for about 30 percent of the errors, and a third driver for about 10 percent of the errors. The other two drivers turn in virtually error-free delivery reports.

You are a high task-oriented (and low relationship-oriented) leader and have decided to talk to the drivers about doing a more complete and accurate job with the delivery reports. Write below exactly how you will go about correcting this problem as a task-oriented leader. Will you meet with drivers individually or in a group? When and where will you meet with them? Exactly what will you say, and how will you get them to listen?

Now adopt the role of a high relationship-oriented (and low task-oriented) leader. Write below exactly what you will do and say as a relationship-oriented distribution manager. Will you meet with the drivers individually or in a group? What will you say, and how will you get them to listen?

In Class: The instructor can ask students to volunteer to play the role of the distribution manager and the drivers. A few students can take turns role-playing the distribution manager

92 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

in front of the class to show how they would handle the drivers as task- and relationship- oriented leaders. The instructor can ask other students for feedback on the leader’s effective- ness and on which approach seems more effective for this situation and why.

Source: Based on K. J. Keleman, J. E. Garcia, and K. J. Lovelace, Management Incidents: Role Plays for Management Development (Dubuque, IA: Kendall Hunt Publishing Company, 1990), pp. 69–72.

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LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Alvis Corporation Kevin McCarthy is the manager of a production department in Alvis Corporation, a firm that manufactures office equipment. After reading an article that stressed the benefits of par- ticipative management, Kevin believes that these benefits could be realized in his department if the workers are allowed to participate in making some decisions that affect them. The workers are not unionized. Kevin selected two decisions for his experiment in participative management.

The first decision involved vacation schedules. Each summer the workers are given two weeks’ vacation, but no more than two workers can go on vacation at the same time. In prior years, Kevin made this decision himself. He would first ask the workers to indicate their preferred dates, and he considered how the work would be affected if different people were out at the same time. It was important to plan a vacation schedule that would ensure adequate staffing for all of the essential operations performed by the department. When more than two workers wanted the same time period and they had similar skills, he usually gave preference to the workers with the highest productivity.

The second decision involved production standards. Sales had been increasing steadily over the past few years, and the company recently installed some new equipment to increase productivity. The new equipment would allow Kevin’s department to produce more with the same number of workers. The company had a pay incentive system in which workers received a piece rate for each unit produced above a standard amount. Separate standards existed for each type of product, based on an industrial engineering study conducted a few years earlier. Top management wanted to readjust the production standards to reflect the fact that the new equipment made it possible for the workers to earn more without working any harder. The savings from higher productivity were needed to help pay for the new equipment.

Kevin called a meeting of his 15 workers an hour before the end of the workday. He explained that he wanted them to discuss the two issues and make recommendations. Kevin figured that the workers might be inhibited about participating in the discussion if he were present, so he left them alone to discuss the issues. Besides, Kevin had an appointment to meet with the quality control manager. Quality problems had increased after the new equip- ment was installed, and the industrial engineers were studying the problem in an attempt to determine why quality had gotten worse rather than better.

When Kevin returned to his department just at quitting time, he was surprised to learn that the workers recommended keeping the standards the same. He had assumed they knew the pay incentives were no longer fair and would set a higher standard. The spokes- man for the group explained that their base pay had not kept up with inflation and the higher incentive pay restored their real income to its prior level.

On the vacation issue, the group was deadlocked. Several of the workers wanted to take their vacations during the same two-week period and could not agree on who should go. Some workers argued that they should have priority because they had more seniority, whereas others argued that priority should be based on productivity, as in the past. Since it was quitting time, the group concluded that Kevin would have to resolve the dispute himself. After all, wasn’t that what he was being paid for?35

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 93

QUESTIONS

1. Analyze this situation using the Hersey–Blanchard model and the Vroom–Jago model. What do these models suggest as the appropriate leadership or decision style? Explain.

2. Evaluate Kevin McCarthy’s leadership style before and during his experiment in partici- pative management.

3. If you, were Kevin McCarthy, what would you do now? Why?

An Impossible Dream? What’s wrong with the team? What’s wrong with the team? Zequine Mansell’s words repeated over and over in Allen Block’s head as he boarded the plane from Los Angeles to Chicago.

Block was responsible for the technical implementation of the new customer relation- ship management (CRM) software being installed for western and eastern sales offices in both cities. The software was badly needed to improve follow-up sales for his company, Exert Systems. Exert sold exercise equipment to high schools and colleges, as well as to small and midsize businesses for recreation centers, through a national force of 310 salespeo- ple. The company’s low prices won a lot of sales; however, follow-up service was uneven and the new CRM system promised to resolve those problems with historical data, inquiries, reminders, and updates going to sales reps daily. The CEO of Exert ordered the CRM sys- tem installed with all possible haste.

Block pulled a yellow pad and pen from the side pocket of his carry-on bag and tossed it in the seat beside the window, stashed the bag in the overhead compartment, and sat down as other passengers filed past. In an effort to shut out his thoughts, he closed his eyes and concentrated on the muffled voices and low whooshing sound of the air vents. An image appeared in his mind of his promotion to Mansell’s job when she retired in two years. He blocked that thought and started doodling on the pad as a way of focusing his thoughts.

He wrote what’s wrong with the team three times and began drawing arrows to circles bearing the names of his team members: Barry Livingston and Max Wojohowski in Los Angeles and Bob Finley, Lynne Johnston, and Sally Phillips in Chicago. He marked through Sally’s name. She had jumped ship recently, taking her less-than-stellar but much-needed talents with her to another company. It was on a previous LA–Chicago flight that Sally had pumped him for feedback on her future with Exert. She had informed him that she had another job offer. She admitted it was less money, but she was feeling under pressure as a member of the team and she wanted more “quality of life.” Block told Sally bluntly that her technical expertise, on which he placed top importance, was slightly below that of her peers, so future promotion was less likely despite her impressive people and team skills.

He wrote “quality of life”, circled it, and then crossed it out and wrote “what the hell?” Why should she get quality of life he mused? I’ve barely seen my wife and kids since this proj- ect started. Block’s team was under a great deal of pressure, and he had needed Sally to stick it out. He told her so, but the plane had barely touched down when she went directly to the office and quit, leaving the team short-handed and too close to deadline to add another body.

What’s wrong with the team? Block furiously scribbled as his thoughts raced: (1) The deadline is ridiculously short. Mansell had scheduled a 10-week completion deadline for the new CRM software, including installation and training for both cities.

He was interrupted by the stewardess. “Would you care for a drink, sir?” “Yes. Just water.” Block took a sip and continued to write. (2) Thank God for LA. From the outset, Barry

and Max had worked feverishly while avoiding the whining and complaining that seemed to overwhelm members of the Chicago team. The atmosphere was different. Although the proj- ect moved forward, meeting deadlines, there appeared to be less stress. The LA guys focused tirelessly on work, with no families to consider, alternating intense work with joking around. “Those are my kind of people,” he thought. (3) But there is Chicago, he wrote. Earlier in the

94 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

day Sam Matheny from sales had e-mailed, then called, Block to tell him the two remaining members of the Chicago team appeared to be alternating between bickering and avoiding one another. Apparently this had been going on for some time. What’s with that? Block wondered. And why did Sam know and I didn’t? So that morning, before his flight, Block had to make time to call and text both Finley and Johnston. Finley admitted he had over- reacted to Johnston.

“Look, man. I’m tired and stressed out. We’ve been working non-stop. My wife is not happy.”

“Just get along until this project is completed,” Block ordered. “When will that be?” Finley asked before hanging up. Block thought about Mansell’s persistent complaints to him that the team appeared to

have a lack of passion, and she admonished him to “get your people to understand the urgency of this project.” Her complaints only added to his own stress level. He had long considered himself the frontrunner for Mansell’s job when she retired in two years. But had his team ruined that dream? The sense of urgency could be measured now in the level of stress and the long hours they had all endured. He admitted his team members were unen- thusiastic, but they seemed committed.

Is it too late to turn around and restore the level of teamwork? He tore off the sheet from the pad, crumpled it in his hand, and stared out the window.

QUESTIONS

1. How would you characterize Block’s leadership approach (task versus people)? What approach do you think is correct for this situation? Why?

2. What would you do now if you were Block? How might you awaken more enthusiasm in your team for completing this project on time? Specify the steps you would take.

3. How would you suggest that Block modify his leadership style if he wants to succeed Mansell in two years? Be specific.

REFERENCES 1. Al Gore, “Tim Cook” segment in “The World’s 100 Most Influential

People,” Time (April 18, 2012), http://www.time.com/time/specials/ packages/article/0,28804,2111975_2111976_2112101,00.html (accessed March 13, 2012); Nick Wingfield, “Apple’s No. 2 Has Low Profile, High Impact,” The Wall Street Journal (October 16, 2006), p. B1; and Jon Katzenbach, “The Steve Jobs Way,” Strategy Business (Summer 2012), www.strategy-guxiness.com/article/00109?gko=d331b (accessed June 11, 2012).

2. Gary Yukl, Angela Gordon, and Tom Taber, “A Hierarchical Taxonomy of Leadership Behavior: Integrating a Half Century of Behavior Research,” Journal of Leadership and Organization Studies 9, no. 1 (2002), pp. 15–32; and Gary Yukl, “Effective Leadership Behavior: What We Know and What Questions Need More Attention,” Academy of Management Perspectives (November 2012), pp. 66–81.

3. See Yukl, “Effective Leadership Behavior”; Lee Ellis, “Results /Relationships: Finding the Right Balance,” Leadership Excellence (October 2012), p. 10; and Kate Ward, “Personality Style: Key to Effective Leadership,” Leadership Excellence (August 2012), p. 14.

4. Paul Hersey and Kenneth H. Blanchard, Management of Organiza- tional Behavior: Utilizing Human Resources, 4th ed. (Upper Saddle River, NJ: Prentice Hall, 1982).

5. Jonathan Kaufman, “A McDonald’s Owner Becomes a Role Model for Black Teenagers,” The Wall Street Journal (August 23, 1995), pp. A1, A6.

6. Carol Hymowitz, “New Face at Facebook Hopes to Map Out a Road to Growth,” The Wall Street Journal (April 14, 2008), p. B1.

7. Cheryl Dahle, “Xtreme Teams,” Fast Company (November 1999), pp. 310–326.

8. Carol Hymowitz, “Managers Find Ways to Get Generations to Close Culture Gap,” (In the Lead column), The Wall Street Journal (July 9, 2007), p. B1.

9. Michael M. Grynbaum, “For City’s Transportation Chief, Kudos and Criticism,” The New York Times (March 4, 2011), www.nytimes. com/2011/03/06/nyregion/06sadik-khan.html?pagewanted=all &_r=0 (accessed March 4, 2011).

10. Fred E. Fiedler, “Assumed Similarity Measures as Predictors of Team Effectiveness,” Journal of Abnormal and Social Psychology 49 (1954), pp. 381–388; F. E. Fiedler, Leader Attitudes and Group Effectiveness (Urbana, IL: University of Illinois Press, 1958); and F. E. Fiedler, A Theory of Leadership Effectiveness (New York: McGraw-Hill, 1967).

11. Neal E. Boudette, “Fiat CEO Sets New Tone at Chrysler,” The Wall Street Journal (June 21, 2009), http://online.wsj.com/article /SB124537403628329989.html (accessed September 14, 2012); and Jeff Bennett and Neal E. Boudette, “Boss Sweats Details of Chrysler Revival,” The Wall Street Journal (January 31, 2011), p. A1; and Kate Linebaugh and Jeff Bennett, “Marchionne Upends Chrysler’s Ways,” The Wall Street Journal (January 12, 2010), http://online.wsj .com/article/SB10001424052748703652104574652364158366106 .html (accessed September 14, 2012).

12. Reported in George Anders, “Theory & Practice: Tough CEOs Often Most Successful, a Study Finds,” The Wall Street Journal (November 19, 2007), p. B3.

CHAPTER 3 CONTINGENCY APPROACHES TO LEADERSHIP 95

13. M. J. Strube and J. E. Garcia, “A Meta-Analytic Investigation of Fiedler’s Contingency Model of Leadership Effectiveness,” Psycholo- gical Bulletin 90 (1981), pp. 307–321; and L. H. Peters, D. D. Hartke, and J. T. Pohlmann, “Fiedler’s Contingency Theory of Leadership: An Application of the Meta-Analysis Procedures of Schmidt and Hunter,” Psychological Bulletin 97 (1985), pp. 274–285.

14. R. Singh, “Leadership Style and Reward Allocation: Does Least Preferred Coworker Scale Measure Tasks and Relation Orientation?” Organizational Behavior and Human Performance 27 (1983), pp. 178–197; D. Hosking, “A Critical Evaluation of Fiedler’s Contingency Hypotheses,” Progress in Applied Psychology 1 (1981), pp. 103–154; Gary Yukl, “Leader LPC Scores: Attitude Dimensions and Behavioral Correlates,” Journal of Social Psychology 80 (1970), pp. 207–212; G. Graen, K. M. Alvares, J. B. Orris, and J. A. Martella, “Contingency Model of Leadership Effectiveness: Antecedent and Evidential Results,” Psychological Bulletin 74 (1970), pp. 285–296; and R. P. Vecchio, “Assessing the Validity of Fiedler’s Contingency Model of Leadership Effectiveness: A Closer Look at Strube and Garcia,” Psychological Bulletin 93 (1983), pp. 404–408.

15. J. K. Kennedy, Jr., “Middle LPC Leaders and the Contingency Model of Leadership Effectiveness,” Organizational Behavior and Human Performance 30 (1982), pp. 1–14; and S. C. Shiflett, “The Contingency Model of Leadership Effectiveness: Some Implications of Its Statistical and Methodological Properties,” Behavioral Science 18, no. 6 (1973), pp. 429–440.

16. Roya Ayman, M. M. Chemers, and F. Fiedler, “The Contingency Model of Leadership Effectiveness: Its Levels of Analysis,” Leadership Quarterly 6, no. 2 (1995), pp. 147–167.

17. Robert J. House, “A Path–Goal Theory of Leadership Effectiveness,” Administrative Science Quarterly 16 (1971), pp. 321–338.

18. Ibid.

19. M. G. Evans, “Leadership,” in S. Kerr, ed., Organizational Behavior (Columbus, OH: Grid, 1974), pp. 230–233.

20. Robert J. House and Terrence R. Mitchell, “Path–Goal Theory of Leadership,” Journal of Contemporary Business (Autumn 1974), pp. 81–97.

21. Jay Goltz, “Are You a Kind Boss? Or Kind of a Boss?” (You’re the Boss column), The New York Times (June 13, 2011), http://boss .blogs.nytimes.com/2011/06/13/are-you-a-kind-boss-or-kind-of-a -boss/ (accessed March 15, 2013).

22. Timothy Aeppel, “Personnel Disorders Sap a Factory Owner of His Early Idealism,” The Wall Street Journal (January 14, 1998), pp. A1–A14.

23. Charles Greene, “Questions of Causation in the Path–Goal Theory of Leadership,” Academy of Management Journal 22 (March 1979), pp. 22–41; and C. A. Schriesheim and Mary Ann von Glinow, “The Path–Goal Theory of Leadership: A Theoretical and Empirical Analysis,” Academy of Management Journal 20 (1977), pp. 398–405.

24. V. H. Vroom and Arthur G. Jago, The New Leadership: Managing Participation in Organizations (Upper Saddle River, NJ: Prentice Hall, 1988).

25. The following discussion is based heavily on Victor H. Vroom, “Leadership and the Decision-Making Process,” Organizational Dynamics 28, no. 4 (Spring 2000), pp. 82–94.

26. R. H. G. Field, “A Test of the Vroom–Yetton Normative Model of Leadership,” Journal of Applied Psychology (October 1982), pp. 523–532; and R. H. G. Field, “A Critique of the Vroom–Yetton Contingency Model of Leadership Behavior,” Academy of Manage- ment Review 4 (1979), pp. 249–251.

27. Vroom, “Leadership and the Decision-Making Process”; Jennifer T. Ettling and Arthur G. Jago, “Participation Under Conditions of Conflict: More on the Validity of the Vroom–Yetton Model,” Journal of Management Studies 25 (1988), pp. 73–83; Madeline E. Heilman, Harvey A. Hornstein, Jack H. Cage, and Judith K. Herschlag, “Reactions to Prescribed Leader Behavior as a Function of Role Perspective: The Case of the Vroom–Yetton Model,” Journal of Applied Psychology (February 1984), pp. 50–60; and Arthur G. Jago and Victor H. Vroom, “Some Differences in the Incidence and Evaluation of Participative Leader Behavior,” Journal of Applied Psychology (December 1982), pp. 776–783.

28. Based on a decision problem presented in Victor H. Vroom, “Leadership and the Decision-Making Process,” Organizational Dynamics 28, no. 4 (Spring, 2000), pp. 82–94.

29. S. Kerr and J. M. Jermier, “Substitutes for Leadership: Their Meaning and Measurement,” Organizational Behavior and Human Perfor- mance 22 (1978), pp. 375–403; and Jon P. Howell and Peter W. Dorfman, “Leadership and Substitutes for Leadership among Profes- sional and Nonprofessional Workers,” Journal of Applied Behavioral Science 22 (1986), pp. 29–46.

30. J. P. Howell, D. E. Bowen, P. W. Doreman, S. Kerr, and P. M. Podsakoff, “Substitutes for Leadership: Effective Alternatives to Ineffective Leader- ship,” Organizational Dynamics (Summer 1990), pp. 21–38.

31. Mark Maske, “Daniel Snyder, Washington Redskins Owner, Adopts Hands-Off Role—and Team Wins,” The Washington Post (January 4, 2013), http://articles.washingtonpost.com/2013-01-04/sports /36209112_1_daniel-snyder-washington-redskins-redskins-park (accessed March 15, 2013).

32. Howell et al., “Substitutes for Leadership: Effective Alternatives.”

33. P. M. Podsakoff, S. B. MacKenzie, and W. H. Bommer, “Transforma- tional Leader Behaviors and Substitutes for Leadership as Determinants of Employee Satisfaction, Commitment, Trust, and Organizational Behaviors,” Journal of Management 22, no. 2 (1996), pp. 259–298.

34. Howell et al., “Substitutes for Leadership.”

35. Reprinted with permission from Gary Yukl, Leadership in Organizations, 7th ed. (Upper Saddle River, NJ: Prentice Hall, 2010), pp. 119–120.

96 PART 2 RESEARCH PERSPECTIVES ON LEADERSHIP

Part 3: The Personal Side of Leadership

Chapter 4: The Leader as an Individual

Chapter 5: Leadership Mind and Emotion

Chapter 6: Courage and Moral Leadership

Chapter 7: Followership

Jo rd an

Ly e/ Fl ic kr O pe n/ G et ty Im ag es

Chapter 4: The Leader as an Individual

Jo rd an

Ly e/ Fl ic kr O pe n/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Understand the importance of self-awareness and how to recognize your blind spots. • Identify major personality dimensions and understand how personality influences leadership and

relationships within organizations.

• Clarify your instrumental and end values and recognize how values guide thoughts and behavior. • Define attitudes and explain their relationship to leader behavior. • Explain attributions and recognize how perception affects the leader–follower relationship. • Recognize individual differences in cognitive style and broaden your own thinking style to expand

leadership potential.

• Understand how to lead and work with people with varied personality traits.

CHAPTER OUTLINE 100 The Secret Ingredient for

Leadership Success

101 Personality and Leadership

109 Values and Attitudes

113 Social Perception and Attributions

116 Cognitive Differences

122 Working with Different Personality Types

In the Lead

102 Rick Williams and John Addison, Primerica Inc.

107 Chris Hughes, Facebook and MyBarackObama.com

112 Admiral Vernon E. Clark, U.S. Chief of Naval Operations, 2000–2005

116 Kevin Kelly, Emerald Packaging

121 Hallmark Cards

Leader’s Self-Insight

103 The Big Five Personality Dimensions

108 Measuring Locus of Control

110 Instrumental and End Values

118 What’s Your Thinking Style?

123 Personality Assessment: Jung’s Typology

Leader’s Bookshelf

106 Quiet: The Power of Introverts in a World That Can’t Stop Talking

Leadership at Work

127 Past and Future

Leadership Development: Cases for Analysis

128 A Nice Manager

130 Environmental Designs International

A s head of Windows at Microsoft, Steven Sinofsky led one of the largest and most important software development companies in the world. He ran the complex organization skillfully, met deadlines, achieved significant accomplishments, and

was generally respected for his brilliant mind. Yet Sinofsky was also known to come across as arrogant and abrasive. Clashes with Microsoft CEO Steven Ballmer and other managers became increasingly frequent. In the fall of 2012, just after the release of Windows 8, Sinofsky and Ballmer agreed that it was time for Sinofsky to leave Microsoft. Sinofsky was considered to be a potential successor to the CEO’s job, but some managers said there would have been a mutiny if he were given the CEO position. It isn’t known if Sinofsky was even interested in the top job, but his difficulty in getting along with people likely derailed his career.1

Did Steven Sinofsky realize his aloof, abrasive personality was hindering his leadership success? At the least, he didn’t seem to care. At a two-day retreat for senior executives at which leaders were expected to make presentations, answer questions, and stay to hear their peers do the same, Sinofsky announced that he

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hadn’t prepared a presentation and suggested people could read the company blog to catch up on the progress of Windows 8. Then he answered a few questions and left the conference, while his colleagues stayed until the next day. “He lost a lot of support,” said one manager.2

In Chapter 2, we examined some traits, individual qualities, and behaviors that are thought to be consistent with effective leadership. Chapter 3 examined contingency theories of leadership, which consider the relationship between leader activities and the situation in which they occur, including followers and the environment. Clearly, organizational leadership is both an individual and an organizational phenomenon. In this chapter, we explore individual differences in more depth and examine how variations in personality, attitudes, values, and so forth influence the leader–follower relationship. Leaders’ ability to understand their own personalities and attitudes, as well as their ability to understand individual differences among employees, can profoundly affect leadership effectiveness. Many of today’s organizations use personality and other psychometric tests as a way to help people better understand themselves and relate to one another.

We begin by considering the importance of leaders knowing themselves, and we look at some potential blind spots leaders may have that limit their understanding and effectiveness. Next, we examine personality and some leader-related personality dimensions. Then the chapter considers how values affect leadership and the ways in which a leader’s attitudes influence behavior. We also explore the role of perception, discuss attributions, and look at cognitive differences, including a discussion of thinking and decision-making styles and the concept of brain dominance. Finally, the chapter considers a few techniques for working with different personality types.

THE SECRET INGREDIENT FOR LEADERSHIP SUCCESS A survey of 75 members of the Stanford Graduate School of Business’s Advisory Coun- cil revealed the nearly unanimous answer to a question about the most important capa- bility for leaders to develop: self-awareness.3 Self-awareness means being aware of the internal aspects of one’s nature, such as personality traits, emotions, values, attitudes, and perceptions, and appreciating how your patterns affect other people.

The Importance of Self-Awareness Most leadership experts agree that a primary characteristic of effective leaders is that they know who they are and what they stand for.4 When leaders deeply under- stand themselves, they remain grounded and constant, so that people know what to expect from them.

Yet being self-aware is easier said than done. When Charlotte Beers, former chairwoman and CEO of Ogilvy & Mather Worldwide, first became a management supervisor, she considered herself to be a friendly, approachable, easy-going leader. She was shocked when a friend told her that one of her colleagues described her management style as “menacing.” That comment was devastating to Beers because it was the exact opposite of the way she thought of herself.5 Many of us, like Charlotte Beers, have blind spots that hinder us from seeing who we really are and the effect our patterns of thought and behavior have on others. Beers now conducts seminars for women leaders, and one thing she tells them is the impor- tance of clearly understanding themselves. The authors of a recent book profiling high achievers found that they all shared a similar characteristic: When faced with

100 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Self-awareness being conscious of the inter- nal aspects of one’s nature, such as personality traits, emotions, values, attitudes, and perceptions, and appre- ciating how your patterns affect other people

obstacles and failures, they underwent a ruthless self-examination to challenge their beliefs, biases, and assumptions.6 A careful self-reflection is essential for most peo- ple to recognize their blind spots.

Leader Blind Spots Doug Rauch, retired president of Trader Joe’s, almost strangled the life out of his company as it grew because of his tendency to, as he puts it, “happily microman- age.” Rauch recognized his zeal to control everything was hurting the company only when a brave senior buyer pulled him aside and said “You’re driving us crazy. You’ve got to back off.” Rauch was surprised, but the comment helped him see his blind spot. He went to the team and admitted his problem, told them he was a “recovering controlaholic,” and asked people to give him regular feedback so he didn’t fall off the wagon.7

Many leaders have blind spots—things they are not aware of or don’t recognize as problems—that limit their effectiveness and hinder their career success.8 One particu- larly damaging blind spot is displaying an aggressive, confrontational style, otherwise known as being a jerk. Lars Dalgaard, founder and CEO of software company SuccessFactors (now part of SAP), says he never realized he acted like a jerk until a leadership coach helped him see that he ran roughshod over people’s feelings. Now, Dalgaard makes a conscious effort to build good relationships with employees and help others be more emotionally aware as well. SuccessFactors, which has an offi- cial “no jerks rule,” has twice been voted one of the best places to work in the San Francisco Bay area.9

Stanford professor Robert Sutton argues that jerks not only hurt the people they work with but also damage organizational performance. Sutton distinguishes between people who are perpetual jerks and those who only occasionally act that way. Perpetual jerks are those leaders who bully, humiliate, and emotionally abuse others, particularly people in less powerful positions.10 Even people who aren’t per- petual jerks can suffer this blind spot. As leaders move up the hierarchy, people skills become more and more important, and leaders who have succeeded at lower levels often don’t see that their approach is less effective as they advance in their careers. Jack Welch, the long-time former CEO of General Electric (GE), had to learn this lesson. When he was vying for the CEO position, his brashness and blunt approach almost cost him the job. GE’s board knew Welch could generate profits, but they needed him to show them that he could act like a CEO, which meant recognizing and toning down his jerk qualities.11

Another blind spot some leaders have is being too nice. Leaders who are con- stantly trying to please everyone can’t lead. They often make poor decisions because they can’t tolerate even a mild degree of conflict.12 When asked about her greatest weakness, Sue Murray, executive director of the George Foundation, said, “I can be too nice when tough decisions need to be made, which is not helpful to anyone. It just prolongs the inevitable.”13 Unlike Murray, many “people pleasers” have a blind spot that prevents them from seeing that they are damaging their relationships and careers by being overly concerned with what others think of them.

PERSONALITY AND LEADERSHIP When a leader understands himself or herself and overcomes blind spots, it becomes easier to understand and interact effectively with others. Understanding personality

NEW LEADER ACTION MEMO As a leader, strive for self- awareness so that you know who you are and what you stand for. Undergo ruthless self-examination and seek feedback from others to avoid being derailed by blind spots.

The challenge for leadership is to be strong, but not rude; be kind, but not weak; be bold, but not bully; be thoughtful, but not lazy; be humble, but not timid; be proud, but not arrogant; have humor, but without folly. Jim Rohn (1930–2009), entrepreneur, author, and motivational speaker

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 101

Blind spots characteristics or habits that people are not aware of or don’t recognize as problems but which limit their effec- tiveness and hinder their career success

differences is one aspect of knowing how to maximize your own effectiveness and that of the people you lead. Personality is the set of unseen characteristics and processes that underlie a relatively stable pattern of behavior in response to ideas, objects, or people in the environment. For example, the insurance and financial services company Primerica, based in Duluth, Georgia, is led by co-CEOs who have very different, yet complementary, personalities.

IN THE LEAD Rick Williams and John Addison, Primerica Inc. Primerica is considered one of the best-managed companies in the insurance and financial products industry. Part of that success, perhaps surprisingly, comes from having two top lea- ders. Having co-CEOs isn’t always successful for organizations, but it has been a magic for- mula for Primerica. Having two people with the right personalities who can both put their egos aside and work for the benefit of the organization has kept the company buzzing.

Since 2000, Primerica has been led by co-CEOs Richard Williams and John Addison. The two have very different—yet complementary—personalities and skill sets. “Rick would walk out of his way to not be in the spotlight,” Addison says of his co-leader. “And if I see one on stage, I’ll walk toward it.” That statement was proven true at the company’s biannual confer- ence. As the two walked onstage to thunderous applause, Williams smiled and waved and quickly rushed to join his wife and investors in the front row of the audience, while Addison entertained and informed the 40,000-person crowd from the spotlight on stage.

Williams doesn’t mind letting Addison have the spotlight; he prefers working behind the scenes and being the “analytical, financial, make-the-trains-run-on-time person.” He’s happy to let Addison be the outgoing, intuitive, motivational half of the duo. “I could never do John’s job,” Williams says, “and John wouldn’t want to do my job.”14

A Model of Personality Notice in the Primerica example that John Addison is described as “intuitive” and Rick Williams is described as “analytical.” Most people think of personality in terms of traits. As we discussed in Chapter 2, researchers have investigated whether any traits stand up to scientific scrutiny, and we looked at some traits associated with effective leadership. Although investigators have examined thousands of traits over the years, their findings have been distilled into five general dimensions that describe personality. These often are called the Big Five personality dimensions, which describe an individual’s extroversion, agreeableness, conscientiousness, emo- tional stability, and openness to experience.15 Each dimension contains a wide range of specific traits—for example, all of the personality traits that you would use to describe a teacher, friend, or boss could be categorized into one of the Big Five dimensions. These factors represent a continuum, in that a person may have a low, moderate, or high degree of each of the dimensions.

Extroversion is made up of traits and characteristics that influence behavior in group settings. Extroversion refers to the degree to which a person is outgoing, sociable, talkative, and comfortable meeting and talking to new people. Someone low on extroversion may come across as quiet, withdrawn, and socially unassertive. This dimension also includes the characteristic of dominance. A person with a high degree of dominance likes to be in control and have influence over others. These

102 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Personality the set of unseen charac- teristics and processes that underlie a relatively stable pattern of behavior in response to ideas, objects, and people in the environment

Big Five personality dimensions five general dimensions that describe personality: extroversion, agreeableness, conscientiousness, emotional stability, and openness to experience

Extroversion the degree to which a person is outgoing, sociable, talkative, and comfortable meeting and talking to new people

people often are quite self-confident, seek out positions of authority, and are com- petitive and assertive. They like to be in charge of others or have responsibility for others. It is obvious that both dominance and extroversion could be valuable for a leader. However, not all effective leaders necessarily have a high degree of these characteristics.

For example, many successful top leaders, including Larry Page of Google; Warren Buffett of Berkshire Hathaway; Brenda Barnes, former CEO of Sara Lee; and Tim Cook, CEO of Apple, are introverts, people who become drained by social encounters and need time alone to reflect and recharge their batteries. One study found that 4 in 10 top executives test out to be introverts.16 Thus, the quality of extroversion is not as significant as is often presumed. In addition, a high degree of dominance could even be detrimental to effective leadership if not tempered by other qualities, such as agreeableness or emotional stability.

Agreeableness refers to the degree to which a person is able to get along with others by being good-natured, cooperative, forgiving, compassionate, understand- ing, and trusting. A leader who scores high on agreeableness seems warm and approachable, whereas one who is low on this dimension may seem cold, distant,

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C a CLEADER’S SELF-INSIGHT 4.1

The Big Five Personality Dimensions

Instructions: Each individual’s collection of personality traits is different; it is what makes us unique. But, although each col- lection of traits varies, we all share many common traits. The following phrases describe various traits and behaviors. Rate how accurately each statement describes you, based on a scale of 1 to 5, with 1 being very inaccurate and 5 very accurate. Describe yourself as you are now, not as you wish to be. There are no right or wrong answers.

1 2 3 4 5 Very Inaccurate Very Accurate

Extroversion I love large parties. 1 2 3 4 5 I feel comfortable around people. 1 2 3 4 5 I talk to a lot of different people at social gatherings.

1 2 3 4 5

I like being the center of attention. 1 2 3 4 5

Neuroticism (Low Emotional Stability) I often feel critical of myself. 1 2 3 4 5 I often envy others. 1 2 3 4 5 I am temperamental. 1 2 3 4 5 I am easily bothered by things. 1 2 3 4 5

Agreeableness I am kind and sympathetic. 1 2 3 4 5 I have a good word for everyone. 1 2 3 4 5 I never insult people. 1 2 3 4 5 I put others first. 1 2 3 4 5

Which are your most prominent traits? For fun and discussion, compare your responses with those of classmates.

Source: These questions were adapted from a variety of sources.

Openness to New Experiences I am imaginative. 1 2 3 4 5 I prefer to vote for liberal political candidates.

1 2 3 4 5

I really like art. 1 2 3 4 5 I love to learn new things. 1 2 3 4 5

Conscientiousness I am systematic and efficient. 1 2 3 4 5 I pay attention to details. 1 2 3 4 5 I am always prepared for class. 1 2 3 4 5 I put things back where they belong. 1 2 3 4 5

NEW LEADER ACTION MEMO See where you fall on the Big Five scale for extroversion, agreeableness, conscientious- ness, emotional stability, and openness to experience by answering the questions in Leader’s Self-Insight 4.1.

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Agreeableness the degree to which a person is able to get along with others by being good- natured, cooperative, forgiving, compassionate, understanding, and trusting

103 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

and insensitive. Studies show that people who score high on agreeableness are more likely to get jobs and keep them than are less agreeable people.17 Although there is also some evidence that people who are overly agreeable tend to be promoted less often and earn less money, the days are over when leaders can expect to succeed by running roughshod over others and looking out only for themselves.

Today’s successful leaders are not the tough guys of the past but those men and women who know how to get people to like and trust them.18 Leaders are making a concerted effort to present a friendlier face to employees, the public, and shareholders after years of headlines exposing white-collar crime, CEO arrogance, and complaints over exorbitant pay. Lee Raymond, the former CEO of ExxonMobil, made plenty of money for investors but was described by some shareholders as “stubborn, self- important, [and] rude.” In contrast, Raymond’s successor, Rex Tillerson, was publicly thanked at one annual meeting for his “friendliness, humor, and candor.”19

The next personality dimension, conscientiousness, refers to the degree to which a person is responsible, dependable, persistent, and achievement oriented. A consci- entious person is focused on a few goals, which he or she pursues in a purposeful way, whereas a less conscientious person tends to be easily distracted and impul- sive. Recent research suggests that traits of conscientiousness are also more impor- tant than those of extroversion for effective leadership. A study at the Stanford Graduate School of Business found a link between how guilty people feel when they make serious mistakes and how well they perform as leaders.20 Guilt can be a positive emotion for a leader because it is associated with a heightened sense of responsibility to others, something that certainly could have benefited leaders involved in the recent mortgage and financial crisis!

Or consider former International Monetary Fund leader Dominique Strauss-Kahn, who was likely on his way to the French presidency before he was arrested in New York and charged with the sexual assault of a hotel housekeeper, with further allega- tions from other women later coming to light.21 Strauss-Kahn displays a low level of conscientiousness, whereas a leader like Anne Mulcahy, former CEO of Xerox, reflects a high degree of this characteristic. Mulcahy felt a strong sense of responsibility to employees and shareholders when she was named CEO of Xerox in 2001.The com- pany was in a free fall, with the stock price plummeting and its credit rating down- graded. Advisers urged Mulcahy to declare bankruptcy, but she chose instead to focus on a vision of restoring Xerox to greatness. Although she had tough decisions to make, she always kept the best interests of employees and shareholders in mind.22

The dimension of emotional stability refers to the degree to which a person is well adjusted, calm, and secure. A leader who is emotionally stable handles stress well, is able to handle criticism, and generally doesn’t take mistakes or failures personally. Leaders with emotional stability typically develop positive relationships and can also improve relationships among others. Marillyn A. Hewson’s high degree of emotional stability is part of the reason she was recently promoted to be the first female CEO of defense contractor Lockheed Martin, after the man originally picked for the top job was fired following discovery of an ethical violation. It’s a challenging time for Lockheed, but Hewson has shown that she can handle crises without becoming unhinged. Over her 30-year career at the company, her calm, steady hand has earned her a reputation for being able to combine toughness with graciousness. “Marillyn will be exactly what Lockheed Martin needs in terms of patching up its relationships …” said defense industry consultant Loren Thompson.23

Leaders who have a low degree of emotional stability are likely to become tense, anxious, or depressed. They generally have lower self-confidence and may

104 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Conscientiousness the degree to which a person is responsible, dependable, persistent, and achievement oriented

Emotional stability the degree to which a person is well adjusted, calm, and secure

explode in emotional outbursts when stressed or criticized. The related topic of emotional intelligence will be discussed in detail in the next chapter.

The final Big Five dimension, openness to experience, is the degree to which a person has a broad range of interests and is imaginative, creative, and willing to consider new ideas. These people are intellectually curious and often seek out new experiences through travel, the arts, movies, reading widely, or other activities. People lower in this dimension tend to have narrower interests and stick to the tried-and-true ways of doing things. Open-mindedness is important to leaders because, as we learned in Chapter 1, leadership is about change rather than stability. In an interesting study of three nineteenth-century leaders—John Quincy Adams, Frederick Douglass, and Jane Addams—one researcher found that early travel experiences and exposure to different ideas and cultures were critical elements in developing open-minded qualities in these leaders.24 Travel during the formative years helped these leaders develop a greater degree of openness to experi- ence because it put them in situations that required adaptability.

Few studies have carefully examined the connection between the Big Five and leadership success. One summary of more than 70 years of personality and leadership research did find evidence that four of the five dimensions were consistently related to successful leadership.25 The researchers found considerable evidence that people who score high on the dimensions of extroversion, agreeableness, conscientiousness, and emotional stability are more successful leaders. Results for openness to experience were less consistent; that is, in some cases, higher scores on this dimension related to better performance, but they did not seem to make a difference in other cases. Yet, in a study by a team of psychologists of the personality traits of the greatest U.S. presi- dents (as determined by historians), openness to experience produced the highest cor- relation with historians’ ratings of greatness. The study noted that presidents such as Abraham Lincoln and Thomas Jefferson were high on this personality dimension. Other personality dimensions the team found to be associated with great presidents were extroversion and conscientiousness, including traits such as assertiveness, setting ambitious goals, and striving for achievement. Although agreeableness did not corre- late with greatness, the ability to empathize with others and being concerned for others, which could be considered elements of emotional stability, did.26

The value of the Big Five for leaders is primarily to help them understand their own basic personality dimensions and then learn to emphasize the positive and mit- igate the negative aspects of their own natural style. For example, people who are introverts often stagnate, especially in large organizations, because they have a dif- ficult time getting noticed and are therefore less likely to be rewarded for their hard work.27 Four out of five introverts surveyed said they believe extroverts are more likely to get ahead at their place of employment.28 One experiment found that peo- ple who spoke up more often were rated as better leaders, even if they were less competent than their quieter colleagues.29 Introverts can learn to behave in more extroverted ways when they need to in order to be more successful. For example, Richard Branson dresses up in silly costumes to publicize the Virgin Group, but he says that flamboyant public persona bears little resemblance to his innate personal- ity. “I was a shy and retiring individual who couldn’t make speeches and get out there,” Branson says of himself prior to founding Virgin. “I had to train myself into becoming more of an extrovert” in order to promote the new company.30

In recent years, there has been a growing awareness that introverted people have some qualities that might actually make them better leaders, as described fur- ther in the Leader’s Bookshelf.31 Introversion or extroversion is simply one aspect of an individual’s personality, and each style has both strengths and weaknesses.

NEW LEADER ACTION MEMO As a leader, you can learn about your own basic person- ality dimensions and how to emphasize the positive aspects of your personality in dealing with followers.

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 105

Openness to experience the degree to which a person has a broad range of interests and is imaginative, creative, and willing to con- sider new ideas

Exhibit 4.1 gives some tips for both introverts and extroverts to help them be more effective and successful.

Personality Traits and Leader Behavior Two specific personality attributes that have a significant impact on behavior and are thus of particular interest for leadership studies are locus of control and authoritarianism.

Locus of Control Some people believe that their actions can strongly affect what happens to them. In other words, they believe they are “masters of their own fate.” Others feel that whatever happens to them in life is a result of luck, chance, or outside people and events; they believe they have little control over their fate. A person’s locus of control defines whether he or she places the primary responsibil- ity within the self or on outside forces.32 People who believe their actions determine what happens to them have a high internal locus of control (internals), whereas those who believe outside forces determine what happens to them have a high external locus of control (externals). One leader who reflects a strong internal locus of control is Chris Hughes, cofounder of Facebook.

LEADER’S BOOKSHELF Quiet: The Power of Introverts in a World That Can’t Stop Talking

by Susan Cain

From kindergarten on in the United States, students are pressured to be more outgoing and speak up more in class. In college, grades are sometimes based on class participation, and stu- dents who don’t forcefully push their ideas get sidelined. No wonder by the time we get to the workplace, we know that talk and social interaction are prized above quietness and thoughtfulness. In her book Quiet, Susan Cain argues that by succumbing to the charms of the extro- vert, organizations are missing out on the creativity, insights, and ideas of the one- third to one-half of Americans who are introverts.

MISCONCEPTIONS ABOUT INTROVERTS Cain’s thoughtful examination, using research studies, historical examples, and individual stories, explodes some of the myths about introversion.

• Introverts are shy and antisocial. Some introverts are shy, but many are not. They simply interact in a different way. Whereas the extrovert will “work the room” at a party, the introvert prefers to carry on deeper

conversations with one or a few people. Introverts need time alone to reflect and recharge, but that doesn’t mean they don’t also enjoy the company of other people.

• Introverts have a personality flaw. In a culture that prizes extroversion, the tendency of introverts toward sol- itary activity and quiet reflection marks them as having “a second- class personality trait, somewhere between a disappointment and a pathology.” Cain points out many advantages to the introverted person- ality: introverts tend to think more deeply, make decisions more carefully, and stay on task longer. Introversion is uniquely conducive to creativity and innovation. Extrovert Steve Jobs was the pizzazz of Apple, but the company would never have existed if intro- verted cofounder Steven Wozniak had not spent long hours alone creat- ing the first computer.

• Introverts don’t make good leaders. This is perhaps the biggest misconcep- tion of all. Introverts such as Bill Gates and Warren Buffett succeed at the top of big corporations, but introverts also

make excellent lower-level supervisors and managers because of their greater ability to listen. Cain cites research showing that introverts do very well leading teams, even those made up primarily of extroverts, because they can stand aside and let the good ideas flow rather than pushing their own thoughts and opinions.

CAN’T WE ALL JUST GET ALONG? No one is totally an introvert or an extro- vert. Each of us falls somewhere along a continuum on the scale of introversion– extroversion. The problem, Cain says, is the tendency in the United States and other Western cultures to revere extro- verts and try to push everyone to that end of the scale. Cain challenges leaders to show respect and truly listen to their introverted colleagues and subordinates, not just be swayed by the loudest voices. “You need to do this as a manager,” she says, “because you … want the best out of people’s brains.”

Source: Quiet: The Power of Introverts in a World That Can’t Stop Talking, by Susan Cain, is published by Crown Publishers.

hu tte rs to ck .c om

Locus of control defines whether a person places the primary responsi- bility for what happens to him or her within himself/ herself or on outside forces

106 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

IN THE LEAD Chris Hughes, Facebook and MyBarackObama.com Chris Hughes grew up in Hickory, North Carolina, as the only child of older parents. His father was a paper salesman and his mother a former public school teacher. When Hughes entered high school, he decided he wanted something different than graduating from the local school and getting a job in town. In fact, what he wanted was to attend a prestigious prep school and go on to an Ivy League university.

With his family’s background and modest means, it was definitely an ambitious goal, but Hughes believed his fate was in his own hands. Without telling his parents, he began researching and applying to various boarding schools. Eventually he was offered a generous financial aid package from Phillips Academy in Andover, Massachusetts. A few years later, he left there with a scholarship to Harvard.

Hughes met Mark Zuckerberg and Dustin Moskovitz during his freshman year at Harvard and the three founded Facebook. Then, during the 2008 presidential campaign, Hughes became attracted to the idea of using new media to get Barack Obama elected. Volunteers flooded the site he built, MyBarackObama.com, from the day it launched. Hughes was later featured on the cover of Fast Company magazine as “The Kid Who Made Obama President.”33

Chris Hughes exhibits many characteristics associated with internal locus of control. Research has shown real differences in behavior between internals and externals across a wide range of settings.34 Internals in general are more self- motivated, are in better control of their own behavior, participate more in social and political activities, and more actively seek information. There is also evidence that internals are better able to handle complex information and problem solving, and that they are more achievement oriented than externals. In addition, people with a high internal locus of control are more likely than externals to try to influ- ence others and thus more likely to assume or seek leadership opportunities.

EXHIBIT 4.1 Maximizing Leadership Effectiveness

Tips for Extroverts Tips for Introverts

• Don’t bask in the glow of your own personality. Learn to hold back and let others sometimes have the limelight.

• Try to underwhelm. Your natural exuberance can cause you to miss important facts and ideas.

• Talk less; listen more. Develop the discipline to let others speak first on an issue to avoid the appearance of arrogance.

• Don’t be Mr. or Ms. Personality. Extroverts some- times fail to recognize others’ needs and can easily wear people out rather than invigorate them.

• Mix with people, speak up, and get out there. Push yourself to get out there and connect with people both within and outside the organization.

• Practice being friendly and outgoing in settings outside of work. Take your new skills to the office.

• Have a game plan. Prepare well for meetings and presentations. Anticipate questions and rehearse a few talking points.

• Smile. A frown or a soberly introspective expres- sion can be misinterpreted. A bright counte- nance reflects confidence that you know where you’re going and want others to follow.

Sources: Based on Patricia Wallington, “The Ins and Outs of Personality,” CIO (January 15, 2003), pp. 42, 44; “From the Front Lines: Leadership Strategies for Introverts,” Leader to Leader (Fall 2009), pp. 59–60; Joann S. Lublin, “Introverted Execs Find Ways to Shine,” The Wall Street Journal Asia (April 18, 2011), p. 31; and Ginka Toegel and Jean-Louis Barsoux, “How to Become a Better Leader,” MIT Sloan Management Review (Spring 2012), pp. 51–60.

NEW LEADER ACTION MEMO Do you believe luck, chance, or the actions of other people play a major role in your life, or do you feel in control of your own fate? Learn more about your locus of control by completing the questionnaire in Leader’s Self-Insight 4.2.

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 107

Moreover, people with a high internal locus of control will take responsibility for outcomes and changes, which is essential for leadership.35

People with a high external locus of control typically prefer to have structured, directed work situations. They are better able than internals to handle work that requires compliance and conformity, but they are generally not as effective in situa- tions that require initiative, creativity, and independent action. Therefore, since exter- nals do best in situations where success depends on complying with the direction or guidance of others, they are less likely to enjoy or succeed in leadership positions.

Authoritarianism The belief that power and status differences should exist in an orga- nization is called authoritarianism.36 Individuals who have a high degree of this person- ality trait tend to adhere to conventional rules and values, obey established authority, respect power and toughness, judge others critically, and disapprove of the expression

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C a CLEADER’S SELF-INSIGHT 4.2

Measuring Locus of Control

Instructions: For each of these 10 questions, indicate the extent to which you agree or disagree using the following scale:

1 Strongly disagree 2 Disagree 3 Slightly disagree 4 Neither agree nor disagree

5 Slightly agree 6 Agree 7 Strongly agree

Strongly Disagree

Strongly Agree

1. When I get what I want, it’s usually because I worked hard for it. 1 2 3 4 5 6 7

2. When I make plans, I am almost certain to make them work. 1 2 3 4 5 6 7

3. I prefer games involving some luck over games requiring pure skill. 1 2 3 4 5 6 7

4. I can learn almost anything if I set my mind to it. 1 2 3 4 5 6 7

5. My major accomplishments are entirely due to my hard work and ability. 1 2 3 4 5 6 7

6. I usually don’t set goals, because I have a hard time following through on them. 1 2 3 4 5 6 7

7. Competition discourages excellence. 1 2 3 4 5 6 7

8. Often people get ahead just by being lucky. 1 2 3 4 5 6 7

9. On any sort of exam or com- petition, I like to know how well I do relative to everyone else. 1 2 3 4 5 6 7

10. It’s pointless to keep working on something that’s too difficult for me. 1 2 3 4 5 6 7

Scoring and Interpretation To determine your score, reverse the values you selected for questions 3, 6, 7, 8, and 10 (1 7, 2 6, 3 5, 4 4, 5 3, 6 2, 7 1). For example, if you strongly disagreed with the statement in question 3, you would have given it a value of 1. Change this value to a 7. Reverse the scores in a similar manner for questions 6, 7, 8, and 10. Now add the point values from all 10 questions together.

Your score:_________

This questionnaire is designed to measure locus of control beliefs. Researchers using this questionnaire in a study of college students found a mean of 51.8 for men and 52.2 for women, with a standard deviation of 6 for each. The higher your score on this questionnaire, the more you tend to believe that you are generally responsible for what hap- pens to you; in other words, high scores are associated with internal locus of control. Low scores are associated with external locus of control. Scoring low indicates that you tend to believe that forces beyond your control, such as powerful other people, fate, or chance, are responsible for what happens to you.

Source: Adapted from J. M. Burger, Personality: Theory and Research (Belmont, CA: Wadsworth, 1986), pp. 400–401. Original source for Burger’s questionnaire is D. L. Paulhus, “Sphere-Specific Measures of Perceived Control,” Journal of Personality and Social Psychology 44 (1983), pp. 1253–1265..

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108

Authoritarianism the belief that power and status differences should exist in an organization

of personal feelings. A leader’s degree of authoritarianism will affect how the leader wields and shares power. A highly authoritarian leader is likely to rely heavily on formal authority and unlikely to want to share power with subordinates. High authoritarianism is associated with the traditional, rational approach to manage- ment described in Chapter 1 and the autocratic style of leadership described in Chapter 2. The new leadership paradigm requires that leaders be less authoritarian, although people who rate high on this personality trait can be effective leaders as well. Leaders should also understand that the degree to which followers possess authoritarianism influences how they react to the leader’s use of power and author- ity. When leaders and followers differ in their degree of authoritarianism, effective leadership may be more difficult to achieve.

Understanding how personality traits and dimensions affect behavior can be an advantage for leaders, giving them valuable insights into their own behavior as well as that of followers. Another important area for understanding individual differ- ences is values and attitudes.

VALUES AND ATTITUDES Individuals may differ significantly in the values and attitudes they hold. These dif- ferences affect the behavior of leaders and followers.

Instrumental and End Values Values are fundamental beliefs that an individual considers to be important, that are relatively stable over time, and that have an impact on attitudes, perception, and behavior.37 Values are what cause a person to prefer that things be done one way rather than another way. Whether we recognize it or not, we are constantly valuing things, people, or ideas as good or bad, pleasant or unpleasant, ethical or unethical, and so forth.38

One way to think about values is in terms of instrumental and end values.39

Social scientist Milton Rokeach developed a list of 18 instrumental values and 18 end values that have been found to be more or less universal across cultures. The full list of Rokeach’s values is shown in Leader’s Self-Insight 4.3. End values, sometimes called terminal values, are beliefs about the kind of goals or outcomes that are worth trying to pursue. For example, some people value security, a com- fortable life, and good health above everything else as the important goals to strive for in life. Others may place greater value on social recognition, pleasure, and an exciting life. Instrumental values are beliefs about the types of behavior that are appropriate for reaching goals. Instrumental values include such things as being helpful to others, being honest, or exhibiting courage.

Although everyone has both instrumental and end values, individuals differ in how they order the values into priorities, which accounts for tremendous varia- tion among people. Understanding one’s own values clarifies what is important, which is essential for effective leadership. Exhibit 4.2 shows some interesting differences in how groups of managers and non-managers prioritized values in one study. The exhibit lists end values and instrumental values that were ranked significantly higher by each group, showing only those rankings that were statisti- cally significant.40 Leaders can identify and understand value differences to improve communication and effectiveness.

NEW LEADER ACTION MEMO As a leader, you can improve your effectiveness by recog- nizing how traits such as authoritarianism and locus of control affect your relation- ships with followers. You can tone down a strong authori- tarian personality to motivate others.

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 109

Values fundamental beliefs that an individual considers to be important, that are relatively stable over time, and that have an impact on attitudes and behavior

End values sometimes called terminal values, these are beliefs about the kind of goals or outcomes that are worth trying to pursue

Instrumental values beliefs about the types of behavior that are appropri- ate for reaching goals

National culture, generational differences, and family background can influence how people rank values. For example, in the United States, independence is highly valued and is reinforced by many institutions, including schools, religious organiza- tions, and businesses. Other cultures place less value on independence and more value on being part of a tightly knit community. Younger people typically rank family security lower than do older people.41 Some leaders cite their parents as a primary source of their deeply held values. Bill Farmer, president of the Jackson- Monroe (Mississippi) division of Time Warner Cable, says his mother instilled in him the importance of giving back to the community. Farmer volunteers as a guest reader at Jackson State University’s Learning Center, has served on the boards of numerous nonprofit organizations, and is actively involved in local Chamber of Commerce initiatives designed to create a positive community environment.42

Our values are generally fairly well established by early adulthood, but a person’s values can also change throughout life. This chapter’s Consider This reflects on how the values that shape a leader’s actions in a moment of crisis have been developed over time. Values may affect leaders and leadership in a number of ways.43 For one thing,

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C a CLEADER’S SELF-INSIGHT 4.3

Instrumental and End Values

Instructions: In each column below, place a check mark by the five values that are most important to you. After you have checked five values in each column, rank-order the checked values in each column from 1 to 5, with 1 most important and 5 least important.

Rokeach’s Instrumental and End Values End Values Instrumental Values A comfortable life Ambition Equality Broad-mindedness An exciting life Capability Family security Cheerfulness Freedom Cleanliness Health Courage Inner harmony Forgiveness Mature love Helpfulness National security Honesty Pleasure Imagination Salvation Intellectualism Self-respect Logic A sense of Ability to love accomplishment Loyalty Social recognition Obedience True friendship Politeness Wisdom Responsibility A world at peace Self-control A world of beauty

NOTE: The values are listed in alphabetical order, and there is no one-to-one relationship between the end and instru- mental values.

Scoring and Interpretation End values, according to Rokeach, tend to fall into two categories—personal and social. For example, mature love is a personal end value and equality is a social end value. Analyze the five end values you selected and their rank order, and determine whether your primary end values tend to be personal or social. What do your five selections together mean to you? What do they mean for how you make life decisions? Compare your end value selections with another person, with each of you explain- ing what you learned about your end values from this exercise.

Instrumental values also tend to fall into two categories— morality and competence. The means people use to achieve their goals might violate moral values (e.g., be dishonest) or vio- late one’s personal sense of competence and capability (e.g., be illogical). Analyze the five instrumental values you selected and their rank order, and determine whether your primary instru- mental values tend to focus on morality or competence. What do the five selected values together mean to you? What do they mean for how you will pursue your life goals? Compare your instrumental value selections with another person and describe what you learned from this exercise.

Warning: The two columns shown to the left do not represent the full range of instrumental and end values. Your findings would change if a different list of values were provided. This exercise is for discussion and learning purposes only and is not intended to be an accurate assess- ment of your actual end and instrumental values.

Sources: Robert C. Benfari, Understanding and Changing Your Manage- ment Style (San Francisco: : Jossey-Bass, 1999), pp. 178–183; and M. Rokeach, Understanding Human Values (New York: The Free Press, 1979).

NEW LEADER ACTION MEMO Complete the exercise in Leader’s Self-Insight 4.3 to see what you can learn about your own values and how they affect your decisions and actions. Were you surprised by any of your instrumental or end values?

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110 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

values influence how leaders relate to others. A leader who values obedience, confor- mity, and politeness may have a difficult time understanding and appreciating a fol- lower who is self-reliant, independent, creative, and a bit rebellious. Personal values influence how leaders perceive opportunities, situations, and problems, as well as the decisions they make in response to them. Consider the decisions Vern Clark made as U.S. Chief of Naval Operations (CNO) from 2000 until his retirement in 2005.

IN THE LEAD Admiral Vernon E. Clark, U.S. Chief of Naval Operations, 2000–2005 Admiral Vernon E. Clark, who retired in July 2005 after a 37-year career in the U.S. Navy, was the second-longest serving U.S. CNO. The job of the CNO is to advise the president on the conduct of war.

When Clark was named CNO in July 2000, the Navy was losing too many good sailors who didn’t want to re-enlist. For Clark, getting and keeping good sailors who could protect the national security was a top priority, and all his decisions were based on valuing the peo- ple on the front lines. When Navy officials proposed budget cuts in training and develop- ment, Clark rebelled. Instead he increased the training budget, strongly supported an increase in pay for sailors, and established the Naval Education and Training Command, with 12 Centers of Excellence. Clark also revised the performance appraisal system to pro- vide constructive feedback for people at all levels. Clark made it a priority to blur the lines between enlisted sailors and officers and revised the job assignment process so people didn’t get forced into jobs and locations they didn’t want. Always more concerned about

EXHIBIT 4.2 Differences in Leaders’ and Nonleaders’ Value Rankings

Source: Based on Table 2, Differences in Managers’ versus Non-Managers’ Terminal and Instrumental Value Ranking, in Edward F. Murphy Jr., Jane Whitney Gibson, and Regina A. Greenwood, “Analyzing Generational Values among Managers and Non-Managers for Sustainable Organizational Effectiveness,” SAM Advanced Management Journal (Winter 2010), pp. 33–55.

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doing things right than being right, Clark encouraged everyone to challenge assumptions, ask questions, and express conflicting views.

Thanks to Admiral Clark’s emphasis on treating sailors right, first term re-enlistment soared from 38 percent to 56.7 percent within his first 18 months as CNO. Moreover, as the Navy retained more sailors, its ability to respond more quickly to protect the nation increased.44

A leader like Admiral Vernon Clark who places high value on supporting fol- lowers, being courageous, and standing up for what one believes in is much more likely to make decisions that may not always be popular but that he believes are right. Leaders can be more effective when they clarify their own values and understand how values guide their actions and affect their organizations. In addition, for many organizations today, clarifying and stating their corporate values, including ethical values, has become an important part of defining how the organization operates.

How Attitudes Affect Leadership Values help determine the attitudes leaders have about themselves and about their followers. An attitude is an evaluation—either positive or negative—about people, events, or things. As we discussed in Chapter 2, an optimistic attitude or positive outlook on life is often considered a key to successful and effective leadership.

A leader’s attitudes toward followers influence how he or she relates to people.45

Every leader’s style is based to some extent on attitudes about human nature in general—ideas and feelings about what motivates people, whether people are basically honest and trustworthy, and the extent to which people can grow and change. One theory to explain differences in style was developed by Douglas McGregor, based on his experiences as a manager and consultant and his training as a psychologist.46 McGregor identified two sets of assumptions about human nature, called Theory X and Theory Y, which represent two very different sets of

Complete the CengageNOW questionnaire, Theory X and Theory Y, to understand the

basic attitudes and assump- tions you might have about followers.

Consider Developing Character

“The character that takes command in moments of critical choices has already been deter- mined. It has been determined by a thousand other choices made earlier in seemingly unim- portant moments. It has been determined by all those ‘little’ choices of years past—by all those times when the voice of conscience was at war with the voice of temptation— whispering a lie that ‘it doesn’t really matter.’ It has been determined by all the day-to-day decisions made when life seemed easy and crises seemed far away, the decisions that piece by piece, bit by bit, developed habits of discipline or of laziness; habits of self-sacrifice or self-indulgence; habits of duty and honor and integrity—or dishonor and shame.”

Source: President Ronald Reagan, quoted in Norman R. Augustine, “Seven Fundamentals of Effective Leadership,” an original essay written for the Center for the Study of American Business, Washington University in St. Louis, CEO Series, no. 27 (October 1998).

Attitude an evaluation (either positive or negative) about people, events, or things

Theory X the assumption that people are basically lazy and not motivated to work and that they have a natural tendency to avoid responsibility

Theory Y the assumption that people do not inherently dislike work and will commit themselves willingly to work that they care about

112 PART 3 THE PERSONAL SIDE OF LEADERSHIP

attitudes about how to interact with and influence subordinates. Exhibit 4.3 explains the fundamental assumptions of Theory X and Theory Y.

In general, Theory X reflects the assumption that people are basically lazy and not motivated to work and that they have a natural tendency to avoid responsibility. Thus, a supervisor who subscribes to the assumptions of Theory X has the attitude that people must be coerced, controlled, directed, or threatened to get them to put forth their best effort. Referring back to Chapter 2, the Theory X leader would likely be task oriented and highly concerned with production rather than people. Theory Y, on the other hand, is based on assumptions that people do not inherently dislike work and will commit themselves willingly to work that they care about. Theory Y also assumes that, under the right conditions, people will seek out greater responsibility and will exercise imagina- tion and creativity in the pursuit of solutions to organizational problems. A leader who subscribes to the assumptions of Theory Y does not believe people have to be coerced and controlled in order to perform effectively. These leaders are more often people oriented and concerned with relationships, although some Theory Y leaders can also be task- or production oriented. McGregor believed Theory Y to be a more realistic and productive approach for viewing subordinates and shaping leaders’ attitudes. Studies exploring the relationship between leader attitudes and leadership success in general sup- port his idea, although this relationship has not been carefully explored.47

SOCIAL PERCEPTION AND ATTRIBUTIONS By perception, we mean the process people use to make sense out of their surround- ings by selecting, organizing, and interpreting information. Values and attitudes affect perceptions, and vice versa. For example, a person might have developed the attitude that leaders are insensitive and arrogant, based on a pattern of perceiving arrogant and insensitive behavior from supervisors over a period of time. If the person moves to a new job, this attitude will continue to affect the way he or she perceives superiors in the new environment, even though his superiors in the new workplace might take

EXHIBIT 4.3 Attitudes and Assumptions of Theory X and Theory Y

Assumptions of Theory X Assumptions of Theory Y

• The average human being has an inherent dis- like of work and will avoid it if possible.

• Because of the human characteristic of dislike for work, most people must be coerced, controlled, directed, or threatened with punishment to get them to put forth adequate effort toward the achievement of organizational objectives.

• The average human being prefers to be directed, wishes to avoid responsibility, has relatively little ambition, and wants security above all.

• The expenditure of physical and mental effort in work is as natural as play or rest. The average human being does not inherently dislike work.

• External control and the threat of punishment are not the only means for bringing about effort toward organizational objectives. A person will exercise self-direction and self-control in the ser- vice of objectives to which he or she is committed.

• The average human being learns, under proper conditions, not only to accept but also to seek responsibility.

• The capacity to exercise a relatively high degree of imagination, ingenuity, and creativity in the solution of organizational problems is widely, not narrowly, distributed in the population.

• Under the conditions of modern industrial life, the intellectual potentialities of the average human being are only partially utilized.

Source: Based on Douglas McGregor, The Human Side of Enterprise (New York: McGraw-Hill, 1960), pp. 33–48.

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 113

Perception the process people use to make sense out of the environment by selecting, organizing, and interpreting information

great pains to understand and respond to employees’ needs. As another example, a leader who greatly values ambition and career success may perceive a problem or a subordinate’s mistake as an impediment to her own success, whereas a leader who values helpfulness and obedience might see it as a chance to help a subordinate improve or grow.

Because of individual differences in attitudes, personality, values, interests, and experiences, people often “see” the same thing in different ways. Consider that one survey of nearly 2,000 workers in the United States found that 92 percent of managers think they are doing an “excellent” or “good” job managing employees, but only 67 percent of workers agree. As another example, in a survey of finance professionals, 40 percent of women said they perceive that women face a “glass ceiling” that keeps them from reaching top management levels, whereas only 10 percent of men share that perception.48

Perceptual Distortions Of particular concern for leaders are perceptual distortions, errors in perceptual judgment that arise from inaccuracies in perception. Some types of errors are so common that leaders should become familiar with them. These include stereotyp- ing, the halo effect, projection, and perceptual defense. Leaders who recognize these perceptual distortions can better adjust their perceptions to more closely match objective reality.

Stereotyping is the tendency to assign an individual to a group or broad category (e.g., female, black, elderly or male, white, disabled) and then to attribute widely held generalizations about the group to the individual. Thus, someone meets a new colleague, sees he is in a wheelchair, assigns him to the category “physically disabled,” and attributes to this colleague generalizations she believes about people with disabilities, which may include a belief that he is less able than other cowor- kers. However, the person’s inability to walk should not be seen as indicative of lesser abilities in other areas. Indeed, the assumption of limitations may not only offend him, but it also prevents the person making the stereotypical judgment from benefiting from the many ways in which this person can contribute. Stereotyp- ing prevents people from truly knowing those they classify in this way. In addition, negative stereotypes prevent talented people from advancing in an organization and fully contributing their talents to the organization’s success.

The halo effect occurs when the perceiver develops an overall impression of a person or situation based on one characteristic, either favorable or unfavorable. In other words, a halo blinds the perceiver to other characteristics that should be used in generating a more complete assessment. The halo effect can play a significant role in performance appraisal. For example, a person with an outstanding atten- dance record may be assessed as responsible, industrious, and highly productive; another person with less-than-average attendance may be assessed as a poor performer. Either assessment may be true, but it is the leader’s job to be sure the assessment is based on complete information about all job-related characteristics and not just his or her preferences for good attendance.

Projection is the tendency of perceivers to see their own personal traits in other people; that is, they project their own needs, feelings, values, and attitudes into their judgment of others. A leader who is achievement oriented might assume that subor- dinates are as well. This might cause the manager to restructure jobs to be less routine and more challenging without regard for employees’ actual satisfaction. The best safeguards against errors based on projection are self-awareness and empathy.

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Perceptual distortions errors in judgment that arise from inaccuracies in the perceptual process

Stereotyping the tendency to assign an individual to a broad cate- gory and then attribute generalizations about the group to the individual

Halo effect an overall impression of a person or situation based on one characteristic, either favorable or unfavorable

Projection the tendency to see one’s own personal traits in other people

Perceptual defense is the tendency of perceivers to protect themselves against ideas, objects, or people that are threatening. People perceive things that are satisfy- ing and pleasant but tend to disregard things that are disturbing and unpleasant. In essence, people develop blind spots in the perceptual process so that negative sensory data do not hurt them. For example, the director of a nonprofit educational organization in Tennessee hated dealing with conflict because he had grown up with parents who constantly argued and often put him in the middle of their argu- ments. The director consistently overlooked discord among staff members until things would reach a boiling point. When the blow-up occurred, the director would be shocked and dismayed because he had truly perceived that everything was going smoothly among the staff. Recognizing perceptual blind spots can help people develop a clearer picture of reality.

Attributions As people organize what they perceive, they often draw conclusions based on their perception.49 Attributions are judgments about what caused an event or behavior— (a) something about the person or (b) something about the situation. For example, many people attribute the success or failure of an organization to the top leader, when in reality there may be many factors that contribute to organizational perfor- mance. People also make attributions or judgments as a way to understand what caused their own or another person’s behavior:

• An internal attribution says characteristics of the person led to the behavior (“My subordinate missed the deadline because he’s lazy and incompetent”).

• An external attribution says something about the situation caused the person’s behavior (“My subordinate missed the deadline because he didn’t have the team support and resources he needed”).

Attributions are important because they help people decide how to handle a situation. In the case of a subordinate missing a deadline, a leader who blames the mistake on the employee’s personal characteristics might reprimand the person or, more effectively, provide additional training and direction. A leader who blames the mistake on external factors will try to help prevent such situations in the future, such as making sure team members have the resources they need, providing support to remove obstacles, and insuring that deadlines are realistic.

The Fundamental Attribution Error People tend to have biases that they apply when making attributions. When evaluating others, many people underestimate the influ- ence of external factors and overestimate the influence of internal factors. This ten- dency is called the fundamental attribution error. Consider the case of someone being promoted to CEO. Employees, outsiders, and the media generally focus on the characteristics of the person that allowed him or her to achieve the promotion. In reality, however, the selection of that person might have been heavily influenced by external factors, such as business conditions creating a need for someone with a strong financial or marketing background at that particular time.

The Self-Serving Bias Another bias that distorts attributions involves attributions we make about our own behavior. People tend to overestimate the contribution of internal factors to their successes and overestimate the contribution of external fac- tors to their failures. This tendency, called the self-serving bias, means people give

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 115

Perceptual defense the tendency to protect oneself by disregarding ideas, situations, or people that are unpleasant

Attributions judgments about what caused a person’s behavior—either characteristics of the person or of the situation

Fundamental attribution error the tendency to underesti- mate the influence of exter- nal factors on another’s behavior and overestimate the influence of internal factors

Self-serving bias the tendency to overesti- mate the influence of inter- nal factors on one’s successes and the influence of external factors on one’s failures

themselves too much credit for what they do well and give external forces too much blame when they fail. Thus, if a leader’s subordinates say she doesn’t listen well enough, and the leader thinks subordinates don’t communicate well enough, the truth may actually lie somewhere in between. At Emerald Packaging, Kevin Kelly examined his attributions and improved his leadership effectiveness by overcoming the self-serving bias, as described in the following example.

IN THE LEAD Kevin Kelly, Emerald Packaging As the top leader of his family’s California company, Emerald Packaging—a maker of plastic bags for the food industry—Kevin Kelly thought of himself as indispensable. He considered himself to be chief architect of the company’s growing sales and profits. When Emerald began to falter, Kelly blamed it on his managers’ resistance to new ideas that could keep the business thriving. He thought everyone needed to change except him.

For some time, Kelly’s leadership approach was to reprimand and complain. Then, he decided to look at things in a different way. Was it really all his managers’ fault? Realizing that everyone was under stress from several years of rapid growth, Kelly hired a pack of new managers to reinforce his exhausted troops. Surprisingly, though, things just seemed to get worse. Kelly had to face a hard truth: Rather than being the one person in the orga- nization who didn’t need to change, as Kelly had previously thought, he realized he was a big part of the problem.

Kelly sought consultants and classes to help boost his people skills. He began meeting regularly with veteran managers and new hires and implemented changes that successfully united the two groups into a cohesive team. Then, Kelly did something radical (at least for him). He took a real 10-day vacation, the first time he hadn’t been in routine contact with Emerald since he took over the company. Visions of disaster filled his head as he wondered how they could get along without him. As it turned out, people got along just fine. Crises got solved, production continued, and customers didn’t even seem to notice he was gone.

By examining his attributions and shifting his perception of himself, the organizational situation, and his managers’ abilities, Kelly made changes that allowed his managers to flourish and his company to grow even more successful.50

COGNITIVE DIFFERENCES The final area of individual differences we will explore is cognitive style. Cognitive style refers to how a person perceives, processes, interprets, and uses information. Thus, when we talk about cognitive differences, we are referring to varying approaches to perceiving and assimilating data, making decisions, solving problems, and relating to others.51 Cognitive approaches are preferences that are not necessar- ily rigid, but most people tend to have only a few preferred habits of thought. One of the most widely recognized cognitive differences is between what we call left- brained versus right-brained thinking patterns.

Patterns of Thinking and Brain Dominance Neurologists and psychologists have long known that the brain has two distinct hemispheres. Furthermore, science has shown that the left hemisphere controls

116 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Cognitive style how a person perceives, processes, interprets, and uses information

movement on the body’s right side and the right hemisphere controls movement on the left. In the 1960s and 1970s, scientists also discovered that the distinct hemi- spheres influence thinking, which led to an interest in what has been called left- brained versus right-brained thinking patterns. The left hemisphere is associated with logical, analytical thinking and a linear approach to problem solving, whereas the right hemisphere is associated with creative, intuitive, values-based thought processes.52 A program sponsored by the New York City Economic Development Corporation illustrates the difference. Artists and other creative people are crucial to the vibrancy of the city, but most artists (right-brain thinking) don’t know how to plan and run a business (left-brain skills) so they have a hard time supporting themselves. The city has invested $50,000 in a program to teach right-brain creative people the left-brain skills they need to turn their creative works into money.53 As another simplified example, people who are very good at verbal and written lan- guage (which involves a linear thinking process) are using the left brain, whereas those who prefer to interpret information through visual images are more right- brained.

Although the concept of left-brained versus right-brained thinking is not entirely accurate physiologically (not all processes associated with left-brained thinking are located in the left hemisphere and vice versa), this concept provides a powerful metaphor for two very different ways of thinking and decision making. It is also important to remember that everyone uses both left-brained and right- brained thinking, but to varying degrees.

More recently, these ideas have been broadened to what is called the whole brain concept.54 Ned Herrmann began developing his concept of whole brain think- ing while he was a manager at GE in the late 1970s and has expanded it through many years of research with thousands of individuals and organizations. The whole brain approach considers not only a person’s preference for right-brained versus left-brained thinking but also for conceptual versus experiential thinking. Herrmann’s whole brain model thus identifies four quadrants of the brain that are related to different thinking styles. Again, while not entirely accurate physiologi- cally, the whole brain model is an excellent metaphor for understanding differences in thinking patterns. Some people strongly lean toward using one quadrant in most situations, whereas others rely on two, three, or even all four styles of thinking. An individual’s preference for each of the four styles is determined through a survey called the Herrmann Brain Dominance Instrument (HBDI), which has been admin- istered to hundreds of thousands of individuals.

The whole brain model provides a useful overview of an individual’s mental preferences, which in turn affect patterns of communication, behavior, and leadership.

Quadrant A is associated with logical thinking, analysis of facts, and processing numbers. A person who has a quadrant-A dominance is rational and realistic, thinks critically, and likes to deal with numbers and technical matters. Quadrant- A thinking might be thought of as the “scientist” part of the brain.55 These people like to know how things work and to follow logical procedures. When a leader has a predominantly A-quadrant thinking style, he or she tends to be directive and authoritative. This leader focuses on tasks and activities and likes to deal with con- crete information and facts. Opinions and feelings are generally not considered as important as facts.

Quadrant B deals with planning, organization of facts, and careful detailed review. A person who relies heavily on quadrant-B thinking is well-organized,

NEW LEADER ACTION MEMO A simplified exercise to help you think about your own preferences appears in Leader’s Self-Insight 4.4. Before reading further, follow the instructions and complete the exercise to get an idea about your domi- nant thinking style according to Herrmann’s whole brain model. Then read the follow- ing descriptions of each quadrant.

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 117

Whole brain concept an approach that considers not only a person’s prefer- ence for right-brained versus left-brained thinking, but al- so conceptual versus expe- riential thinking; identifies four quadrants of the brain related to different thinking styles

Quadrant A the part of the brain associ- ated in the whole brain model with logical thinking, analysis of facts, and pro- cessing numbers

Quadrant B the part of the brain associ- ated in the whole brain model with planning, orga- nizing facts, and careful detailed review

reliable, and neat. This is the “manager” part of the brain.56 These people like to establish plans and procedures and get things done on time. Leaders with a pre- dominantly quadrant-B thinking style are typically conservative and highly tradi- tional. They tend to avoid risks and strive for stability. Thus, they may insist on following rules and procedures, no matter what the circumstances are.

Quadrant C is associated with interpersonal relationships and affects intuitive and emotional thought processes. C-quadrant individuals are sensitive to others and enjoy interacting with and teaching others; hence this might be considered the “teacher” part of the brain.57 These people are typically emotional and expressive, outgoing, and supportive of others. Leaders with a predominantly quadrant-C style are friendly, trusting, and empathetic. They are concerned with people’s feelings more than with tasks and procedures and may put emphasis on employee develop- ment and training.

Quadrant D is associated with conceptualizing, synthesizing, and integrating facts and patterns, with seeing the big picture rather than the details. This is the “artist” part of the brain.58 A person with a quadrant-D preference is visionary and imaginative, likes to speculate and break the rules, takes risks, and may be impulsive. These people are curious and enjoy experimentation and playfulness. The D-quadrant leader is holistic, imaginative, and entrepreneurial. This leader enjoys change, experimentation, and risk-taking and generally allows followers a great deal of freedom and flexibility.

Exhibit 4.4 illustrates the model with its four quadrants and some of the mental processes associated with each. There is no style that is necessarily better or worse, though any of the styles carried to an extreme can be detrimental. Each style can

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 4.4

What’s Your Thinking Style?

Instructions: The following characteristics are associated with the four quadrants identified by Herrmann’s whole brain model. Think for a moment about how you approach problems and make decisions. In addition, consider how you typically approach your work or class assignments and how you interact with others. Circle 10 of the terms below that you believe best describe your own cognitive style. Try to be honest and select terms that apply to you as you are, not how you might like to be. There are no right or wrong answers.

A B C D Analytical Organized Friendly Holistic Factual Planned Receptive Imaginative Directive Controlled Enthusiastic Intuitive Rigorous Detailed Understanding Synthesizing Realistic Conservative Expressive Curious Intellectual Disciplined Empathetic Spontaneous Objective Practical Trusting Flexible Knowledgeable Industrious Sensitive Open-Minded Bright Persistent Passionate Conceptual Clear Implementer Humanistic Adventurous

The terms in Column A are associated with logical, analytical thinking (Quadrant A); those in Column B with organized, detail-oriented thinking (Quadrant B); those in Column C with empathetic and emotionally based thinking (Quadrant C); and those in Column D with integrative and imaginative thinking (Quadrant D). Do your preferences fall primarily in one of the four columns, or do you have a more balanced set of preferences across all four? If you have a strong preference in one particular quadrant, were you surprised by which one? ©

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Quadrant C the part of the brain associ- ated in the whole brain model with interpersonal relationships and intuitive and emotional thought processes

Quadrant D the part of the brain associ- ated in the whole brain model with conceptualizing, synthesizing, and integrating facts and patterns

118 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

have both positive and negative results for leaders and followers. It is important to remember that every individual, even those with a strong preference in one quad- rant, actually has a coalition of preferences from each of the four quadrants.59

Each of us has at least a few qualities of the scientist, manager, teacher, and artist. In addition, Herrmann believes people can learn to use their “whole brain”

rather than relying only on one or two quadrants. His research indicates that very few, if any, individuals can be wholly balanced among the four quadrants, but peo- ple can be aware of their preferences and engage in activities and experiences that help develop the other quadrants. Leaders who reach the top of organizations often have well-balanced brains, according to Herrmann’s research. Angela Ahrendts, for example, applies a balance of thinking styles as CEO of Burberry, the $2 billion British fashion empire. Ahrendts has used creative, holistic thinking (Quadrant D) to transform Burberry from an outdated brand into a “technologically savvy inter- national fashion powerhouse.” Another right-brain characteristic is her emphasis on building positive interpersonal relationships (Quadrant C). Yet Ahrendts also demonstrates left-brain thinking in her careful control of the company’s finances (Quadrant B) and her ability to be realistic, analytical, and rational when it comes to making difficult decisions (Quadrant A). When the recession hit in 2008, Ahrendts quickly took charge, putting on hold plans for new stores, cutting $78 million in expenses, laying off employees and freezing salaries, and changing company procedures to be more cost-effective.60

The typical CEO is a balanced thinker with at least two, usually three, and often four strong preferences and thus has a wide range of thinking options avail- able to choose from. A broad range of thinking styles is particularly important at higher levels of organizations because leaders deal with a greater variety and complexity of people and issues.61

Understanding that individuals have different thinking styles can also help leaders be more effective in interacting with followers. Some leaders act as if everyone

EXHIBIT 4.4 Herrmann’s Whole Brain Model

Source: Ned Herrmann, The Whole Brain Business Book (New York: McGraw-Hill, 1996) p. 15.

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responds to the same material and behavior in the same way, but this isn’t true. Some people prefer facts and figures, whereas others want to know about relationships and patterns. Some followers prefer freedom and flexibility, whereas others crave structure and order. Leaders can shift their styles and behaviors to more effectively communi- cate with followers and help them perform up to their full potential. Leaders can also recruit people with varied cognitive styles to help achieve important goals.

Problem-Solving Styles: Jungian Types Another approach to cognitive differences grew out of the work of psychologist Carl Jung. Jung believed that differences in individual behavior resulted from pre- ferences in how we go about gathering and evaluating information for solving pro- blems and making decisions.62 One of the most widely used tests in the United States, the Myers–Briggs Type Indicator (MBTI)™ assessment, is one way of measuring how individuals differ in these areas.63 The MBTI™ assessment has been taken by millions of people around the world and can help individuals better understand themselves and others.

The MBTI™ instrument uses four different pairs of attributes to classify people in 1 of 16 different personality types:

1. Introversion versus extroversion: This dimension focuses on where people gain interpersonal strength and mental energy. Extroverts (E) gain energy from being around others and interacting with others, whereas introverts (I) gain energy by focusing on personal thoughts and feelings.

2. Sensing versus intuition: This identifies how a person absorbs information. Those with a sensing preference (S) gather and absorb information through the five senses, whereas intuitive people (N) rely on less direct perceptions. Intuitives, for example, focus more on patterns, relationships, and hunches than on direct perception of facts and details.

3. Thinking versus feeling: This dimension relates to how much consideration a person gives to emotions in making a decision. Feeling types (F) tend to rely more on their values and sense of what is right and wrong, and they consider how a decision will affect other people’s feelings. Thinking types (T) tend to rely more on logic and be very objective in decision making.

4. Judging versus perceiving: The judging versus perceiving dimension concerns an individual’s attitudes toward ambiguity and how quickly a person makes a decision. People with a judging preference like certainty and closure. They enjoy having goals and deadlines and tend to make decisions quickly based on available data. Perceiving people, on the other hand, enjoy ambiguity, dislike deadlines, and may change their minds several times before making a final decision. Perceiving types like to gather a large amount of data and information before making a decision.

The various combinations of these preferences result in 16 unique types. There are a number of exercises available in print and on the Internet that can help people determine their preferences according to the MBTI™ assessment. Individuals develop unique strengths and weaknesses as a result of their preferences for intro- version versus extroversion, sensing versus intuition, thinking versus feeling, and judging versus perceiving. As with the whole brain approach, MBTI™ types should not be considered ingrained or unalterable. People’s awareness of their preferences, training, and life experiences can cause them to change their preferences over time.

NEW LEADER ACTION MEMO As a leader, you can strive for “whole brain” thinking to deal effectively with a wide variety of people and complex issues. You can be aware of your natural thinking patterns and include other perspectives that help you develop a broader understanding.

120 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Myers–Briggs Type Indicator (MBTI)™ test that measures how individuals differ in gathering and evaluating information for solving problems and making decisions

Nearly 200 agencies of the U.S. government, including the Environmental Protec- tion Agency (EPA), the Central Intelligence Agency (CIA), and the Department of Veterans Affairs, have been reported to use the MBTI™ instrument as part of their training programs. Brian Twillman of the EPA says at least a quarter of the agency’s 17,000 federal employees have taken the test, and that without it “there would be a lot of blind spots within the agency.”64 A primary value of the MBTI™ assessment is that it starts an important dialogue about how people interact with others. Hallmark Cards is one of the 10,000 or so companies that have used the MBTI™ to help people better understand themselves and improve their interactions.

IN THE LEAD Hallmark Cards The value of people understanding and seeing the best in one another is a core part of Hallmark’s mission. The mission and core philosophy have remained constant, but the mar- ket, workforce, and business environment have changed dramatically in recent years, becoming more global, diverse, and mobile.

To meet the challenges of this new reality, Hallmark executives wanted to develop lea- ders who can see things from different perspectives, work together for everyone’s success, and fully engage and inspire both employees and customers. One approach to creating that new culture was using the MBTI™ to give managers greater self-awareness and insight into how their patterns of thought and behavior affect others. “We tend to place people into ‘files’ according to our perceptions of them, which are often skewed,” said Mary Beth Ebmeyer, HR manager for corporate development.

The MBTI™ has helped leaders understand how easily misunderstandings can occur between people with different preferences. For example, a leader might receive an e-mail message that he considers to be confrontational, whereas the person who sent it might simply be expressing a well-intentioned concern in a way typical of her person- ality type. Understanding different MBTI™ types has enabled leaders to test their percep- tions against reality, as well as helped them better communicate with different types. Moreover, decisions are being made faster because there are fewer misunderstandings among managers.65

By understanding different MBTI™ types, Hallmark leaders can flex their com- munication style as needed and connect more meaningfully with employees. In addition, being aware of their own MBTI™ type enables leaders to maximize their strengths and minimize their weaknesses. Leaders should remember that each type can have positive and negative consequences for behavior.

There has been an increasing application of the MBTI™ assessment in leader- ship studies.66 These studies confirm that there is no “leader type,” and all 16 of the MBTI™ types can function effectively as leaders. As with the four quadrants of the whole brain model, leaders can learn to use their preferences and balance their approaches to best suit followers and the situation. However, research reveals some interesting, although tentative, findings. For example, although extroversion is often considered an important trait for a leader, leaders in the real world are about equally divided between extroverts and introverts. In regard to the sensing versus intuition dimension, data reveal that sensing types are in the majority in fields

NEW LEADER ACTION MEMO Go to Leader’s Self-Insight 4.5, on page 123 at the end of this chapter, to complete an exer- cise that will identify your preferences for the four pairs of attributes identified by the MBTI™ assessment.

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 121

where the focus is on the immediate and tangible (e.g., construction, banking, manufacturing). However, in areas that involve breaking new ground or long- range planning, intuitive leaders are in the majority. Thinking (as opposed to feel- ing) types are more common among leaders in business and industry as well as in the realm of science. In addition, thinking types appear to be chosen more often as managers even in organizations that value “feeling,” such as counseling centers. Finally, one of the most consistent findings is that judging types are in the majority among the leaders studied.

Thus, based on the limited research, the two preferences that seem to be most strongly associated with successful leadership are thinking and judging. However, this doesn’t mean that people with other preferences cannot be effective leaders. Much more research needs to be done before any conclusions can be reached about the relationship between MBTI™ types and leadership.

WORKING WITH DIFFERENT PERSONALITY TYPES As this chapter has shown, leaders have to work with individuals who differ in many ways. Personality differences, in particular, can make the life of a leader inter- esting and sometimes exasperating. These differences can create an innovative envi- ronment but also lead to stress, conflict, and negative feelings.

Leaders can learn to work more effectively with different personality types by following some simple guidelines.67

• Understand your own personality and how you react to others. Avoid judging people based on limited knowledge, and realize that everyone has different facets to their personality. Learn to control your frustration to help you keep different personality types focused on the goal and the tasks needed to reach it.

• Treat everyone with respect. People like to be accepted and appreciated for who they are. Even if you find someone’s personality grating, remain profes- sional and keep your irritation to yourself. Don’t gossip or joke about others.

• Acknowledge each person’s strengths. Everyone wants to be recognized for their unique talents, so be sure to acknowledge and make use of people’s useful personality characteristics. For instance, a pessimistic person can be difficult to be around, but these gloomy folks can sometimes be helpful by calling attention to legitimate problems with an idea or plan.

• Strive for understanding. A good approach to take with a personality type widely different from yours is to clarify questions every time there’s a potential for miscommunication. Follow up each question or request with a statement explaining why you asked and how it will benefit the organization as well as the individual.

• Remember that everyone wants to fit in. No matter their personalities, people typically take on behavior patterns that are the norm for their environment. Leaders can create norms that keep everyone focused on positive interactions and high performance.

Occasional personality conflicts are probably inevitable in any group or organi- zation, but by using these techniques, leaders can generally keep the work environ- ment positive and productive.

122 PART 3 THE PERSONAL SIDE OF LEADERSHIP

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C a CLEADER’S SELF-INSIGHT 4.5

Personality Assessment: Jung’s Typology

Instructions: For each item below, circle either “a” or “b.” In some cases, both “a” and “b” may apply to you. You should decide which is more like you, even if it is only slightly more true.

1. I would rather

a. Solve a new and complicated problem b. Work on something that I have done before

2. I like to

a. Work alone in a quiet place b. Be where “the action” is

3. I want a boss who

a. Establishes and applies criteria in decisions b. Considers individual needs and makes exceptions

4. When I work on a project, I

a. Like to finish it and get some closure b. Often leave it open for possible change

5. When making a decision, the most important consid- erations are

a. Rational thoughts, ideas, and data b. People’s feelings and values

6. On a project, I tend to

a. Think it over and over before deciding how to proceed

b. Start working on it right away, thinking about it as I go along

7. When working on a project, I prefer to

a. Maintain as much control as possible b. Explore various options

8. In my work, I prefer to

a. Work on several projects at a time, and learn as much as possible about each one

b. Have one project that is challenging and keeps me busy

9. I often

a. Make lists and plans whenever I start something and may hate to seriously alter my plans

b. Avoid plans and just let things progress as I work on them

10. When discussing a problem with colleagues, it is easy for me

a. To see “the big picture” b. To grasp the specifics of the situation

11. When the phone rings in my office or at home, I usually

a. Consider it an interruption b. Don’t mind answering it

12. The word that describes me better is

a. Analytical b. Empathetic

13. When I am working on an assignment, I tend to

a. Work steadily and consistently b. Work in bursts of energy with “down time” in

between

14. When I listen to someone talk on a subject, I usually try to

a. Relate it to my own experience and see if it fits b. Assess and analyze the message

15. When I come up with new ideas, I generally

a. “Go for it” b. Like to contemplate the ideas some more

16. When working on a project, I prefer to

a. Narrow the scope so it is clearly defined b. Broaden the scope to include related aspects

17. When I read something, I usually

a. Confine my thoughts to what is written there b. Read between the lines and relate the words to

other ideas

18. When I have to make a decision in a hurry, I often

a. Feel uncomfortable and wish I had more information

b. Am able to do so with available data

19. In a meeting, I tend to

a. Continue formulating my ideas as I talk about them

b. Only speak out after I have carefully thought the issue through

20. In work, I prefer spending a great deal of time on issues of

a. Ideas b. People

21. In meetings, I am most often annoyed with people who

a. Come up with many sketchy ideas b. Lengthen the meeting with many practical details

22. I tend to be

a. A morning person b. A night owl

23. My style in preparing for a meeting is

a. To be willing to go in and be responsive b. To be fully prepared and sketch out an outline of

the meeting

| D re am

st im e. co m

(continued)

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Personality Assessment: Jung’s Typology (Continued) 24. In meetings, I would prefer for people to

a. Display a fuller range of emotions b. Be more task oriented

25. I would rather work for an organization where

a. My job was intellectually stimulating b. I was committed to its goals and mission

26. On weekends, I tend to

a. Plan what I will do b. Just see what happens and decide as I go along

27. I am more

a. Outgoing b. Contemplative

Scoring Count one point for each item listed below that you circled in the inventory.

Score for I Score for E Score for S Score for N (Introversion) (Extroversion) (Sensing) (Intuition)

2a 2b 1b 1a 6a 6b 10b 10a

11a 11b 13a 13b 15b 15a 16a 16b 19b 19a 17a 17b 22a 22b 21a 21b 27b 27a 28b 28a 32b 32a 30b 30a

Totals Circle the one with more points:

I or E Circle the one with more points:

S or N (If tied on I/E, don’t count #11) (If tied on S/N, don’t count #16)

Score for T Score for F Score for J Score for P (Thinking) (Feeling) (Judging) (Perceiving)

3a 3b 4a 4b 5a 5b 7a 7b

12a 12b 8b 8a 14b 14a 9a 9b 20a 20b 18b 18a 24b 24a 23b 23a 25a 25b 26a 26b 29b 29a 31a 31b

Totals Circle the one with more points:

T or F (If tied on T/F, don’t count #24)

Circle the one with more points: J or P

(If tied on J/P, don’t count #23)

Your Score Is: I or E S or N T or F J or P

Your type is: (example: INTJ, ESFP, etc.)

28. I would rather work for a boss who is a. Full of new ideas b. Practical

In the following, choose the word in each pair that appeals to you more:

29. a. Social b. Theoretical

30. a. Ingenuity b. Practicality

31. a. Organized b. Adaptable

32. a. Activity b. Concentration

124 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Personality Assessment: Jung’s Typology (Continued) Scoring and Interpretation The scores above measure variables similar to the MBTI™ assessment based on the work of psychologist Carl Jung. The MBTI™ assessment, which was described in the chapter text, identifies four dimensions and 16 different “types.” The dominant characteristics associated with each dimension and each type are shown below. Remember that no one is a pure type; however, each individual has preferences for introversion versus extroversion, sensing versus intuition, think- ing versus feeling, and judging versus perceiving. Based on your scores on the survey, read the description of your dimension and type in the chart. Do you believe the description fits your personality?

Characteristics associated with each dimension

Extroversion: Energized by outer world of people and objects, broad interests, thinks while speaking

Introversion: Energized by inner world of thoughts and ideas, deep interests, thinks before speaking

Sensing: Likes facts, details, and practical solutions. Intuition: Likes meanings, theory, associations among data, and possibilities.

Thinking: Makes decisions by analysis, logic, and impersonal criteria.

Feeling: Makes decisions based on values, beliefs, and concern for others.

Judging: Lives life organized, stable, systematic, and under control.

Perceiving: Lets life happen, spontaneous, open-ended, last minute.

Characteristics associated with each type

ISTJ: Organizer, trust- worthy, responsible, good trustee or inspector.

ISFJ: Quiet, conscien- tious, devoted, handles detail, good conservator.

INFJ: Perseveres, inspi- rational, quiet caring for others, good counselor.

INTJ: Independent thinker, skeptical, theory, competence, good scientist.

ISTP: Cool, observant, easy-going, good craftsperson.

ISFP: Warm, sensitive, team player, avoids conflict, good artist.

INFP: Idealistic, strong values, likes learning, good at noble service.

INTP: Designer, logical, conceptual, likes chal- lenges, good architect.

ESTP: Spontaneous, gre- garious, good at problem solving and promoting.

ESFP: Sociable, gener- ous, makes things fun, good as entertainer.

ENFP: Imaginative, enthusiastic, starts pro- jects, good champion.

ENTP: Resourceful, stimulating, dislikes routine, tests limits, good inventor.

ESTJ: Order, structure, practical, good adminis- trator or supervisor.

ESFJ: People skills, har- monizer, popular, does things for people, good host.

ENFJ: Charismatic, persuasive, fluent presenter, sociable, active, good teacher.

ENTJ: Visionary planner, takes charge, hearty speaker, natural leader.

Source: From Organizational Behavior: Experience and Cases, 4th ed., by Dorothy Marcic. © 1995. Reprinted with permission of South-Western, a division of Thomson Learning: http://www.thomsonrights.com. Fax: 800-730-2215.

125 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

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LEADERSHIP ESSENTIALS • This chapter explored the importance of self-awareness and some of the indi-

vidual differences that affect leaders and the leadership process. Individuals dif- fer in many ways, including personality, values and attitudes, and styles of thinking and decision making.

• One model of personality, the Big Five personality dimensions, examines whether individuals score high or low on the dimensions of extroversion, agree- ableness, conscientiousness, emotional stability, and openness to experience. Although there is some indication that a high degree of each of the personality dimensions is associated with successful leadership, individuals who score low on various dimensions may also be effective leaders. Two specific personality traits that have a significant impact on leader behavior are locus of control and authoritarianism.

• Values are fundamental beliefs that cause a person to prefer that things be done one way rather than another. One way to think about values is in terms of instrumental and end values. End values are beliefs about the kinds of goals that are worth pursuing, whereas instrumental values are beliefs about the types of behavior that are appropriate for reaching goals. Values also affect an individual’s attitudes. A leader’s attitudes about self and others influence how the leader behaves toward and interacts with followers. Two sets of assump- tions called Theory X and Theory Y represent two very different sets of atti- tudes leaders may hold about people in general.

• Differences in personality, values, and attitudes influence perception, which is the process people use to select, organize, and interpret information. Perceptual distortions include stereotyping, the halo effect, projection, and perceptual defense. Attributions refer to how people explain the causes of events or beha- viors. Based on their perception, people may make either internal or external attributions.

• Another area of individual differences is cognitive style. The whole brain concept explores a person’s preferences for right-brained versus left-brained thinking and for conceptual versus experiential thinking. The model pro- vides a powerful metaphor for understanding differences in thinking styles. Individuals can learn to use their “whole brain” rather than relying on one thinking style. Another way of looking at cognitive differences is the MBTI™, which measures an individual’s preferences for introversion versus extroversion, sensing versus intuition, thinking versus feeling, and judging versus perceiving.

• Finally, the chapter offered some tips for how leaders can work more effectively with varied personality types. By understanding their own personalities, treat- ing everyone with respect, recognizing people’s unique abilities, circumventing communication breakdowns, and creating a positive environment, leaders can better keep diverse people productive and focused on goals instead of personal- ity differences.

Tw itt er

126 PART 3 THE PERSONAL SIDE OF LEADERSHIP

DISCUSSION QUESTIONS 1. Do you agree that self-awareness is essential for being a good leader? Can you think of some

specific negative consequences that might result from a leader not having self-awareness?

2. Extroversion is often considered a “good” quality for a leader to have. Why might introversion be considered an equally positive quality?

3. A survey found that 79 percent of CEOs surveyed fall into the category of being “highly optimistic,” whereas a much lower percentage of chief financial officers were rated as highly optimistic. Do you think these differences reflect personality characteristics or the different requirements of the two jobs? Discuss.

4. The chapter suggests that one way to work effectively with different personalities is to treat everyone with respect. How might a leader deal with a subordinate who is perpet- ually rude, insensitive, and disrespectful to others?

5. What might be some reasons the dimension of “openness to experience” correlates so strongly with historians’ ratings of the greatest U.S. presidents but has been less strongly associated with business leader success? Do you think this personality dimension might be more important for business leaders of today than it was in the past? Discuss.

6. Leaders in many of today’s organizations use the results of personality testing to make hiring and promotion decisions. Discuss some of the pros and cons of this approach.

7. From Leader’s Self-Insight 4.3, identify four or five values (instrumental or end values) that could be a source of conflict between leaders and followers. Explain.

8. Do you believe understanding your preferences according to the whole brain model can help you be a better leader? Discuss.

9. How can a leader use an understanding of brain dominance to improve the functioning of the organization?

10. Hallmark Cards discovered that its mid- and upper-level managers were primarily thinking types, but top executives displayed primarily feeling preferences. Why do you think this might be?

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LEADERSHIP AT WORK Past and Future Draw a life line below that marks high and low experiences during your life. Think of key decisions, defining moments, peak experiences, and major disappointments that shaped who you are today. Draw the line from left to right, and identify each high and low point with a word or two.

Birth Year: Today’s Date:

What made these valued experiences? How did they shape who you are today?

Now take the long view of your life. In 10-year increments, write below the leader experiences you want to have. Provide a brief past-tense description of each decade

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 127

(e.g., next 10 years—big starting salary, bored in first job, promoted to middle management).

Next 10 years:

Following 10 years:

What personal skills and strengths will you use to achieve the future?

What is your core life purpose or theme as expressed in the life line and answers above?

What would your desired future self say to your present self?

How do your answers above relate to your scores on the Leader Self-Insight question- naires you completed in this chapter?

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LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS A Nice Manager Chisum Industries’ management promotion process was a benchmark for providing lateral moves as well as promotion to the next level within the company. With offices, plants, and warehouses located in seven Texas cities, opportunities for the best and brightest were extensive for middle management employees. The process invited candidates to explore goals, strengths, and weaknesses and to recount real-life scenarios and accomplishments. The selection team also visited the worksites of candidates for on-the-job observations and talks with fellow workers before bringing the final candidates to Dallas for interviews. The process offered personal insight and growth opportunities to all candidates for promo- tion. In March 2011, top management, including Marcus Chisum, Karl Jacobson, Mitch Ivey, Wayne Hughes, and Barbara Kennedy, were midway through a meeting to consider which of four middle management candidates to promote to the top position in the San Antonio office.

128 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Marcus: “Who do we have next?”

Barbara: “Harry Creighton.” Scanning the group, Marcus sees a few nods and a shrug.

Marcus: “Feedback?”

Karl and Wayne, simultaneously: “Great guy.”

Karl: “We all know that Harry came into a situation in which that particular location was suffering a drop in performance. Morale was low and there were rumors of layoffs. He came in and calmed employee fears and has done a good job of raising performance levels.”

Wayne: “He has a great relationship with employees. As we went around and talked to people, it was obvious that he has developed a level of trust and a vision that workers buy into.”

Barbara: “The word that kept coming up among the workers was ‘nice.’” As was his habit during meetings, Mitch leaned back in his chair, tapping his pencil on the table. Initially annoyed by the habit, over time the team had gotten used to the sound.

Marcus: “Mitch, your initial reaction to his name was a shrug. What are you thinking?”

Mitch: “Just wondering if nice is what we’re looking for here?” The remark was met with laughter. “Tell me, how does a manager achieve an across-the-board reputation as a nice guy? I’ve worked for and with a number of managers during my life. I respected them, thought many of them were fair and up-front in their treatment of us; thought some were jerks who should be canned …”

Marcus: “I hope I don’t fall into that last category.” (Laughter)

Mitch: “I don’t recall any consensus about a manager being nice.”

Karl: “Several people mentioned that Harry always has their back.”

Barbara: “I got the impression that Harry covers for them.”

Marcus: “Meaning what?”

Wayne: “Meaning, giving them some slack when it comes to things like overlooking their weaknesses, a little sloppiness with deadlines or taking time off.”

Barbara: “Several mentioned that he’s always willing to … let me look at my notes … ‘Always willing to step in and help out.’ The phrase came up more than a few times and when I pressed them, they didn’t elaborate. But I wondered …”

Karl: “ … Is he managing or taking on some of their responsibilities?”

Barbara: “Exactly.”

Mitch: “It’s bothering me that he comes across as the parent who does his kid’s project for the science fair.”

Wayne: “I don’t think it’s that bad, but when you look at him in comparison with the other candidates, it makes me question whether he can take on the tough part of top management. There is nothing distinctive about him or his style.”

Karl: “There’s no edge here. No sense of boundaries. Does he want to manage employees or be popular with them? Can he say ‘No’ and mean it?”

Barbara: “Does Harry have the capability to walk that fine line that separates leaders; that distinguishes respect versus popularity or encouragement and support over stepping in and helping out?”

Marcus: “So, we see some good things about Harry. He has a lot of potential. But we also see that he has not yet reached a level where we can entrust him with this top management position. Our task here, then, is to move on with the selection process, but over the next weeks I would like for us to consider ways to help Harry reach that potential for future opportunities.”

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 129

QUESTIONS

1. What does nice mean to you? Do you think nice is a good trait for leaders or the kiss of death?

2. Is nice related to any concepts in the chapter, such as one of the big five personality dimensions, Myers–Briggs components, or left–right brain dominance? Discuss.

3. If Harry is passed over for promotion, what feedback and advice would you give him about how to improve his leadership skills for possible future promotion?

Environmental Designs International When Lee Keiko returned from a quick lunch, she scanned her e-mail inbox for the message she had been dreading. She found it, labeled “high priority,” among a dozen other e-mails and sank back in her chair as she mentally prepared to open it. Keiko felt a tightening in her stomach as she clicked on the message and braced herself for the assault she had grown to expect from Barry Carver, her boss at Environmental Designs International (EDI), a rap- idly growing “green” company that specializes in retrofitting commercial buildings to improve their energy efficiency.

The primary clients of EDI are owners of skyscrapers who renovate their buildings to reduce energy use and cut down on greenhouse gas emissions, a contributor to global warm- ing. Within these towering skyscrapers, the largest energy guzzlers are lighting, cooling, and heating. Owners of New York City’s Empire State Building expect to reduce the skyscraper’s energy use by 38 percent by the year 2013 at an annual savings of $4.4 million after this 78-year-old building is retrofitted.

Keiko had expected Carver’s scathing e-mail and knew he would lambaste her and her team for missing last Friday’s deadline for submitting a proposal to retrofit a 60-story Chicago skyscraper to meet new federal green standards. Keiko had warned Carver of the possible delay in completing the proposal due to changing federal regulations for energy effi- ciency. It was truly out of her hands. She had even consulted with the client to alert them of the delay, and they had agreed to an extended deadline.

Nevertheless, Carver was angry about the delay and fired off an e-mail that was brus- que and insensitive. “I depend on you to meet deadlines and work effectively with regulatory agencies. Your ineptness may cost us this important project,” he exclaimed in his e-mail to Keiko. “Why aren’t you as committed to this project as I am? I can’t do this alone,” he stated. This was one more example of how Carver often made life miserable for his subordi- nates, verbally attacking them to get results. Carver had also started alienating his peers. During a recent meeting to discuss the replacement of thousands of windows in the Chicago skyscraper, Carver embarrassed a colleague by accusing him of selecting a vendor without doing a price comparison among vendors. “How can I value your recommendation, Troy, if you fail to do your homework? I need new prices by Friday!” shouted Carver.

Carver was a highly skilled architect and responsible for managing a team of designers in EDI’s Chicago office. Although his abrupt personality had helped him climb the corporate ladder, his intimidating communication style was beginning to create problems and hamper his ability to get results. Carver learned in his performance review that his work relation- ships were suffering and the complaints about him were increasing. Even his long-time peers were avoiding him as much as possible and finding ways to work around him.

Sensitive to the growing animosity toward him, Carver began to reconsider how he interacted with his staff and peers. He felt motivated to begin using some of the tools he had recently learned in the executive education course he had just completed. During one of the skills-assessment activities, Carver learned that he could get better results by communi- cating more gently, building consensus, and working in a more team-oriented manner. Fur- ther, he realized he had to find ways to handle his anger and frustration when dealing with federal regulatory agencies and the inevitable delays that hampered progress on big construc- tion projects. As he thought about the skills assessment, Carver wondered if he could soften

130 PART 3 THE PERSONAL SIDE OF LEADERSHIP

his image and perhaps even be considered for a senior management position he was eyeing in EDI’s Los Angeles office.

Sources: Based on information in Gerry Yemen, Erika H. James, and James G. Clawson, “Nicholas Gray: The More Things Change …,” (Darden Business Publishing, University of Virginia, Copyright 2003; and Mireya Navarro, “The Empire State Building Plans a Growth Spurt, Environmentally,” The New York Times (April 7, 2009), p. A25.

QUESTIONS

1. “At the senior management level, you get hired for competence. You get fired for personality.” In your opinion, is this statement true or false? How does it relate to Barry Carver and his current leadership style?

2. Identify the behaviors described in this case that were damaging to Barry Carver’s work relationships. Why would a manager behave this way? What negative consequences did these behaviors have on his peers and subordinates?

3. How realistic is it that Carver (or anyone) can change his own leadership skills? What kind of help might he need?

REFERENCES 1. Nick Wingfield, “Ex-Windows Chief Seen as Smart but Abrasive,”

The New York Times (November 14, 2012), p. B1.

2. Ibid.

3. Reported in William W. George, Peter Sims, Andrew N. MacLean, David Mayer, and Diana Mayer, “Discovering Your Authentic Leadership,” Harvard Business Review (February 2007), pp. 129–138.

4. Bill George, “Leadership Skills: It Starts with Self-Awareness,” Leadership Excellence (June 2011), p. 13; Tricia Bisoux, “What Makes Leaders Great” (interviews with leadership experts), BizEd (September–October 2005), pp. 40–45; Warren Bennis, Why Leaders Can’t Lead (San Francisco: Jossey-Bass, 1989); Daniel Goleman, “What Makes a Leader?” Harvard Business Review (November– December 1998), p. 93ff; and Richard E. Boyatzis, The Competent Manager: A Model for Effective Performance (New York: Wiley, 1982).

5. Charlotte Beers, interviewed by Adam Bryant, “The Best Scorecard Is the One You Keep for Yourself,” The New York Times (March 31, 2012), http://www.nytimes.com/2012/04/01/business/charlotte-beers -on-the-importance-of-self-assessment.html?pagewanted=all (accessed April 1, 2012).

6. Camille Sweeney and Josh Gosfield, The Art of Doing: How Superachievers Do What They Do and How They Do It So Well (New York: Plume/Penguin, 2013), as reported in Sweeney and Gosfield, “Secret Ingredient for Success,” The New York Times (January 20, 2013), p. SR4.

7. Doug Rauch, “Failure Chronicles: ‘You’re Driving Us Crazy. You’ve Got to Back Off,’” Harvard Business Review (April 2011), p. 56.

8. Steven Snyder, “Leadership Struggle: It’s an Art to Be Mastered,” Leadership Excellence (January 2013), p. 11; and Ira Chaleff, “Avoid Fatal Crashes: Leaders and Their Blind Spots,” Leadership Excellence (May 2012), p. 13.

9. Sue Shellenbarger, “To Combat an Office Tyrant, Look at the Roots,” The Wall Street Journal (April 28, 2010); and Ed Frauenheim, “Pulling No Punches,” Workforce Management (October 6, 2008), p. 1.

10. Robert I. Sutton, The No Asshole Rule: Building a Civilized Workplace and Surviving One That Isn’t (New York: Warner Business Books, 2007)

11. Marshall Goldsmith, “People Skills: These Matter Most at the Top Level,” Leadership Excellence (June 2007), p. 9.

12. Alex Lickerman, “The Good Guy Contract,” Psychology Today (March–April 2010), pp. 42–43.

13. Quoted in L. Mitchell, “Ten Things I Don’t Put on My C.V.: Sue Murray,” Age (October 25, 2008), p. 3.

14. Todd Henneman, “For Some Companies, Two Heads Are Better than One,” Workforce (November 16, 2011), http://www.workforce.com /apps/pbcs.dll/article?AID=/20111116/NEWS02/111119975&template= (accessed November 23, 2011); and “Banking and Finance Companies: A.M. Best Affirms Ratings of Primerica, Inc. and Its Subsidiaries,” Investment Weekly News (July 7, 2012), p. 129.

15. J. M. Digman, “Personality Structure: Emergence of the Five-Factor Model,” Annual Review of Psychology 41 (1990), pp. 417–440; M. R. Barrick and M. K. Mount, “Autonomy as a Moderator of the Relationships between the Big Five Personality Dimensions and Job Performance,” Journal of Applied Psychology (February 1993), pp. 111–118; J. S. Wiggins and A. L. Pincus, “Personality: Structure and Assessment,” Annual Review of Psychology 43 (1992), pp. 473–504; and Carl Zimmer, “Looking for Personality in Animals, of All People,” The New York Times (March 1, 2005), p. F1.

16. Del Jones, “Not All Successful CEOs Are Extroverts,” USA Today (June 6, 2006), p. B1; and Bryan Walsh, “The Upside of Being an Introvert (and Why Extroverts Are Overrated),” Time (February 6, 2012), pp. 40–45.

17. Reported in Daisy Grewal, “When Nice Guys Finish First,” Scientific American Mind (July–August 2012), pp. 62–65.

18. Anthony J. Mayo and Nitin Nohria, “Double-Edged Sword,” People Management (October 27, 2005), pp. 36–38; Carol Hymowitz, “Rewarding Competitors over Collaborators No Longer Makes Sense” (In the Lead column), The Wall Street Journal (February 13, 2006), p. B1; and Joseph Nocera, “In Business, Tough Guys Finish Last,” The New York Times (June 18, 2005), p. C1.

19. Diane Brady, “Charm Offensive,” BusinessWeek (June 26, 2006), pp. 76–80.

20. Research reported in J. J. McCorvey, “Research Corner: Feeling Guilty? Good. Why Guilt Makes You a Better Leader,” Inc. (July– August 2012), p. 26; and Rachel Emma Silverman, “Plagued by Guilt? You May Be Management Material,” The Wall Street Journal

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 131

(May 29, 2012), http://blogs.wsj.com/atwork/2012/05/29/plagued -by-guilt-you-may-be-management-material/ (accessed June 3, 2012).

21. Anne-Elisabeth Moutet, “Dominique Strauss-Kahn: A Frenchman Sunk by a Sex Scandal?” The Telegraph (May 16, 2011), http://www .telegraph.co.uk/news/worldnews/europe/france/8515714/Dominique -Strauss-Kahn-A-Frenchman-sunk-by-a-sex-scandal.html (accessed August 26, 2012).

22. Bill George, “The Courage to Say ‘No’ to Wall Street” (segment in “America’s Best Leaders”), U.S. News & World Report (December 1– December 8, 2008), pp. 34–51; Andrew Davidson, “Xerox Saviour in the Spotlight,” Sunday Times (June 1, 2008), p. 6; and David K. Williams, “Top 10 List: The Greatest Living Business Leaders Today,” Forbes (July 24, 2012), www.forbes.com/sites/davidkwilliams / 2 0 1 2 / 0 7 /2 4 /to p -1 0 -l is t-th e-g r ea tes t-li vi n g -b u s i n es s -lea d er s -today/ (accessed March 4, 2013).

23. Marjorie Censer, “After Nearly 30 Years with Lockheed, Hewson Is Named Chief Executive,” The Washington Post (November 13, 2012), http://www.washingtonpost.com/business/capitalbusiness /after-nearly-30-years-with-lockheed-hewson-is-named-chief-executive /2012/11/13/173cc04a-2cdc-11e2-a99d-5c4203af7b7a_story .html?wprss=rss_business (accessed November 14, 2012); and Doug Cameron and Joann S. Lublin, “Vaulted to Top at Lockheed, and Ready to Navigate Cliff,” The Wall Street Journal Online ( N o v e m b e r 1 1 , 2 0 1 2 ) , h t t p : / / o n l i n e . w s j . c o m / a r t i c l e /SB10001424127887324439804578113250113672078.html (accessed March 19, 2013).

24. James B. Hunt, “Travel Experience in the Formation of Leadership: John Quincy Adams, Frederick Douglass, and Jane Addams,” The Journal of Leadership Studies 7, no. 1 (2000), pp. 92–106.

25. R. T. Hogan, G. J. Curphy, and J. Hogan, “What We Know about Leadership: Effectiveness and Personality,” American Psychologist 49, no. 6 (1994), pp. 493–504.

26. Randolph E. Schmid, “Psychologists Rate What Helps Make a President Great,” Johnson City Press (August 6, 2000), p. 10; and “Personality and the Presidency” segment on NBC News with John Siegenthaler Jr. (August 5, 2000).

27. Jack and Suzy Welch, “Release Your Inner Extrovert,” BusinessWeek (December 8, 2008), p. 92; and Nancy Ancowitz, “Success Isn’t Only for the Extroverts,” The New York Times (November 1, 2009), p. BU8.

28. Reported in “From the Front Lines: Leadership Strategies for Introverts,” Leader to Leader (Fall 2009), pp. 59–60.

29. Reported in Jeffrey Kluger, “Why Bosses Tend to Be Blowhards,” Time (March 2, 2009), p. 48.

30. Ginka Toegel and Jean-Louis Barsoux, “How to Become a Better Leader,” MIT Sloan Management Review (Spring 2012), pp. 51–60.

31. Susan Cain, “Hire Introverts,” The Atlantic (July–August 2012), p. 68; Adam M. Grant, Francesca Gino, and David A. Hofmann, “The Hidden Advantages of Quiet Bosses,” Harvard Business Review (December 2010), p. 28; Susan Cain, “Must Great Leaders Be Gregarious?” The New York Times (September 16, 2012), p. SR-8; and Walsh, “The Upside of Being an Introvert.”

32. “Theories of Emeritus Professor Julian Rotter Still Relevant to Field of Clinical Psychology” U.S. Fed News Service, Including US State News (August 12, 2012) (retrieved from http://search.proquest.com .proxy.library.vanderbilt.edu/docview/1032581459?accountid =14816); P. E. Spector, “Behavior in Organizations as a Function of Employee’s Locus of Control,” Psychological Bulletin (May 1982), pp. 482–497; and H. M. Lefcourt, “Durability and Impact of the Locus of Control Construct,” Psychological Bulletin 112 (1992), pp. 411–414.

33. Ellen McGirt, “Boy Wonder,” Fast Company (April 2009), pp. 58–65, 96–97.

34. Spector, “Behavior in Organizations as a Function of Employee’s Locus of Control”; Lefcourt, “Durability and Impact of the Locus of Control Construct”; and J. B. Miner, Industrial-Organizational Psychology (New York: McGraw-Hill, 1992), p. 151.

35. Elizabeth A. McDaniel and Holly DiBella-McCarthy, “Reflective Leaders Become Causal Agents of Change,” Journal of Management Development 31, no. 7 (2012), pp. 663–671.

36. T. W. Adorno, E. Frenkel-Brunswick, D. J. Levinson, and R. N. Sanford, The Authoritarian Personality (New York: Harper & Row, 1950).

37. E. C. Ravlin and B. M. Meglino, “Effects of Values on Perception and Decision Making: A Study of Alternative Work Value Measures,” Journal of Applied Psychology 72 (1987), pp. 666–673.

38. Robert C. Benfari, Understanding and Changing Your Management Style (San Francisco: Jossey-Bass, 1999), p. 172.

39. Milton Rokeach, The Nature of Human Values (New York: The Free Press, 1973); and M. Rokeach, Understanding Human Values (New York: The Free Press, 1979).

40. Edward F. Murphy Jr., Jane Whitney Gibson, and Regina A. Greenwood, “Analyzing Generational Values among Managers and Non-Managers for Sustainable Organizational Effectiveness,” SAM Advanced Management Journal (Winter 2010), pp. 33–55.

41. Ibid.

42. Lynne Jeter, “Early Lessons Helped Form Leadership Skills,” The Mississippi Business Journal (March 13, 2006), p. 23.

43. Based on G. W. England and R. Lee, “The Relationship between Managerial Values and Managerial Success in the United States, Japan, India, and Australia,” Journal of Applied Psychology 59 (1974), pp. 411–419.

44. Example from Michael Lee Stallard, “Great Leaders Connect: Using Their Vision, Values, and Voice,” Leadership Excellence (August 2012), p. 19.

45. Based on Richard L. Hughes, Robert C. Ginnett, and Gordon J. Curphy, Leadership: Enhancing the Lessons of Experience (Boston: Irwin McGraw-Hill, 1999), pp. 182–184.

46. Douglas McGregor, The Human Side of Enterprise (New York: McGraw-Hill, 1960).

47. J. Hall and S. M. Donnell, “Managerial Achievement: The Personal Side of Behavioral Theory,” Human Relations 32 (1979), pp. 77–101.

48. Andrea Coombes, “Managers Rate Themselves High but Workers Prove Tough Critics,” The Wall Street Journal (September 26, 2006), p. B8; and Jaclyne Badal, “Surveying the Field: Cracking the Glass Ceiling” (sidebar in Theory & Practice column), The Wall Street Journal (June 19, 2006), p. B3.

49. This is a very brief introduction to the subject of attributions and their role in organizations. For a recent overview of the research on attributional theory and a special issue devoted to the topic, see Marie Dasborough, Paul Harvey, and Mark J. Martinko, “An Introduction to Attributional Influences in Organizations,” Group & Organization Management 36, no. 4 (2011), pp. 419–426.

50. Kevin Kelly, “Branching Out,” Fortune Small Business (December 2005–January 2006), p. 39; and Kevin Kelly, “Take a Real Vacation,” Fortune Small Business (July–August 2006), p. 28.

51. Dorothy Leonard and Susaan Straus, “Putting Your Company’s Whole Brain to Work,” Harvard Business Review (July–August 1997), pp. 111–121.

52. Henry Mintzberg, “Planning on the Left Side and Managing on the Right,” Harvard Business Review (July–August 1976), pp. 49–57; Richard Restak, “The Hemispheres of the Brain Have Minds of Their Own,” The New York Times (January 25, 1976); and Robert Ornstein, The Psychology of Consciousness (San Francisco: W. H. Freeman, 1975).

132 PART 3 THE PERSONAL SIDE OF LEADERSHIP

53. Kate Taylor, “Creative Types, Learning to Be Business-Minded,” The New York Times (June 19, 2010), p. C1.

54. This discussion is based on Ned Herrmann, The Whole Brain Business Book (New York: McGraw-Hill, 1996).

55. This analogy is based on Peter Gloor, “To Become a Better Manager Stop Being a Manager,” Ivey Business Journal (March–April 2011), http://www.iveybusinessjournal.com/topics/the-organization/to -become-a-better-manager-stop-being-a-manager (accessed March 20, 2013).

56. Ibid.

57. Ibid.

58. Ibid.

59. Herrmann, The Whole Brain Business Book, p. 103.

60. Example described in Nancy Hass, “Earning Her Stripes,” The Wall Street Journal Magazine (September 9, 2010), http://magazine.wsj .com/features/the-big-interview/earning-her-strips/ (accessed March 20, 2013).

61. Herrmann, The Whole Brain Business Book, p. 179.

62. Carl Jung, Psychological Types (London: Routledge and Kegan Paul, 1923).

63. Otto Kroeger and Janet M. Thuesen, Type Talk (New York: Delacorte Press, 1988); Kroeger and Thuesen, Type Talk at Work (New York: Dell, 1992); “Conference Proceedings,” The Myers–Briggs Type

Indicator and Leadership: An International Research Conference (January 12–14, 1994); and S. K. Hirsch, MBTI™ Team Member’s Guide (Palo Alto, CA: Consulting Psychologists Press, 1992).

64. Reported in Lillian Cunningham, “Does It Pay to Know Your Type?” The Washington Post (December 14, 2012), http://articles.washington post.com/2012-12-14/national/35847528_1_personality-types -myers-briggs-type-indicator-financial-success (accessed March 20, 2013).

65. Example in Jennifer Overbo, “Using Myers–Briggs Personality Type to Create a Culture Adapted to the New Century,” T D (February 2010), pp. 70–72.

66. Based on Mary H. McCaulley, “Research on the MBTI™ and Leadership: Taking the Critical First Step,” Keynote Address, The Myers–Briggs Type Indicator and Leadership: An International Research Conference (January 12–14, 1994).

67. These techniques are based on Jamie Walters and Sarah Fenson, “Building Rapport with Different Personalities,” Inc.com (March 2000), http://www.inc.com/articles/2000/03/17713.html; Tim Millett, “Learning to Work with Different Personality Types,” http:// ezinearticles.com/?Learning-To-Work-With-Different-Personality -Types&id=725606; and Carol Ritberter, “Understanding Personality: The Secret to Managing People,” http://www.dreammanifesto.com /understanding-personality-the-secret-of-managing-people.html (accessed April 17, 2008).

CHAPTER 4 THE LEADER AS AN INDIVIDUAL 133

Chapter 5: Leadership Mind and Emotion

Jo rd an

Ly e/ Fl ic kr O pe n/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Recognize how mental models guide your behavior and relationships. • Engage in independent thinking by staying mentally alert, thinking critically, and being mindful

rather than mindless.

• Break out of categorized thinking patterns and open your mind to new ideas and multiple perspectives.

• Begin to apply systems thinking and personal mastery to your activities at school or work. • Exercise emotional intelligence, including being self-aware, managing your emotions, motivating

yourself, displaying empathy, and managing relationships.

• Apply the difference between motivating others based on fear and motivating others based on love.

CHAPTER OUTLINE 136 Leading with Head and Heart

136 Mental Models

140 Developing a Leader’s Mind

146 Emotional Intelligence

153 Leading with Love versus Leading with Fear

In the Lead

139 Hollywood Studios

152 John Harbaugh, Baltimore Ravens, and Jim Harbaugh, San Francisco 49ers

155 Akshay Kothari and Ankit Gupta, Pulse News

Leader’s Self-Insight

143 Mindfulness

153 Emotional Intelligence

154 Love or Fear?

Leader’s Bookshelf

141 What Got You Here Won’t Get You There

Leadership at Work

159 Mentors

Leadership Development: Cases for Analysis

160 The New Boss

161 The USS Florida

A s Lieutenant Colonel Howard Olson surveys the crowd before him, he knows that most of the people in the room outrank him. Still, Olson opens his talk with the following statement: “Each and every one of you has something that

makes you a jerk…. Some of you have more than one. I know. I’ve talked to you.” The lecture is part of what the U.S. Army informally calls “charm school,” a

week-long course held annually for the select few who are promoted to brigadier general. Everyone knows about the Army’s skill at getting new recruits in boot camp to think and act in a new way, but few people have seen firsthand the training it uses to get high-ranking officers to make a mental and emotional leap. At charm school, new generals are advised to get in touch with their inner jerk and work on overcoming that aspect of their personality. Charm school is designed as a reminder that the great officers are those who genuinely care about their soldiers. Other recurring themes during the training include avoiding even the appearance of ethical violations, leading with moral courage, and overcoming arrogance, the “first deadly sin of the general officer.”1

There’s no equivalent training in corporate America, but the lessons taught at the Army’s charm school are also being taken to heart at many of today’s business

135 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

organizations, where leaders are learning to build work relationships based on trust, humility, caring, and respect.

This chapter and the next examine current thinking about the importance of leaders becoming fully integrated people by exploring the full capacities of their minds, emotions, and spirits. Noted leadership author and scholar Warren Bennis has said that “there’s no difference between being a really effective leader and becoming a fully integrated person.”2 This chapter first examines the importance of leading with both head and heart (mind and emotion). Then we expand on some of the ideas introduced in the previous chapter to consider how the ability to shift our thinking and feeling can help leaders alter their behavior, influence others, and be more effective. We discuss the concept of mental models and look at how qualities such as independent thinking, an open mind, and systems thinking are important for leaders. Then we take a closer look at human emotions, the concept of emotional intelligence, and the emotions of love versus fear in leader– follower relationships. The next chapter will turn to spirit as reflected in moral leadership and courage.

LEADING WITH HEAD AND HEART As most of us know from personal experience, working effectively with other people requires that we draw on subtle aspects of ourselves—our thoughts, beliefs, and feelings—and appeal to those aspects in others. Anyone who has participated on an athletic team knows how powerfully thoughts and emotions can affect performance. Interestingly, though, many people in leadership roles tend to forget the emotional aspect of leading.

To succeed in today’s environment requires whole leaders who use both their head and their heart.3 Leaders have to use their head to tend to organiza- tional issues such as goals and strategies, production schedules, structure, finances, operational issues, and so forth. They also have to use their heart to tend to human issues, such as understanding, supporting, and developing others. Using heart in leadership is particularly important in times of uncer- tainty and rapid change. Current issues that require leaders to use both head and heart include how to give people a sense of meaning and purpose when major changes occur almost daily; how to make employees feel valued and respected in an age of massive layoffs and job uncertainty; and how to keep morale and motivation high in the face of corporate bankruptcies and dissolutions, ethical scandals, and eco- nomic crises.

A broad literature has emphasized that being a whole person means operating from mind, heart, spirit, and body.4 In Chapter 4, we introduced some ideas about how individuals think, make decisions, and solve problems based on values, atti- tudes, and patterns of thinking. This chapter builds on some of those ideas to pro- vide a broader view of leadership mind and emotions.

MENTAL MODELS A mental model can be thought of as an internal picture that affects a leader’s thoughts, actions, and relationships with others. Mental models are theories people hold about specific systems in the world and their expected behavior.5 A system

NEW LEADER ACTION MEMO As a leader, you can lead with both head and heart. You can expand the capacity of your mind, emotions, and spirit by consciously engaging in activi- ties that use aspects of the whole self.

136 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Mental models theories people hold about specific systems in the world and their expected behavior

means any set of elements that interact to form a whole and produce a specified outcome. To understand what is meant by a mental model, consider an electrical circuit as a system. Exhibit 5.1 shows the elements of an electrical circuit system. A mental model would give you a picture in your mind of how these four elements fit together to produce the outcome of light. Just as an electric circuit is a system, an organization is a system, as is a football team, a sorority pledge drive, or the regis- tration system at a university. An accurate mental model helps a leader understand how to arrange the key elements in these systems to get the desired outcome.

Leaders have many mental models that tend to govern how they interpret experiences and how they act in response to people and situations. Consider the two different mental models in the following quote from Robert Townsend, former CEO of Avis Rent-a-Car. To have a successful organization, he advised leaders, “you’ll have to give up being an administrator who loves to run others and become a manager who carries water for his people so they can get on with the job.”6 The first part of the phrase reflects a mental model that it is the leader’s job to control people, whereas the second part reflects a mental model that the leader is a servant who helps people do their best. Exhibit 5.2 shows the mental model that Google’s

20 15

EXHIBIT 5.1 Elements of a System

NEW LEADER ACTION MEMO As a leader, you can become aware of your mental models and how they affect your thinking and behavior. You can learn to regard your assump- tions as temporary ideas and strive to expand your mindset.

EXHIBIT 5.2 Google Leaders’ Mental Model

• Stay uncomfortable • Let failure coexist with triumph • Use a little less “management” than you need • Defy convention • Move fast and figure things out as you go

Source: Based on Adam Lashinsky, “Chaos by Design,” Fortune (October 2, 2006), pp. 86–98.

CHAPTER 5 LEADERSHIP MIND AND EMOTION 137

top leaders use to keep the company on the cutting edge as its core business of search matures. At Google, leaders believe that risk-taking, a little craziness, and making mistakes are important for the sake of innovation. Too much structure and control is considered death to the company.7

Leaders at Google, as well as other organizations, strive to create mental mod- els that are aligned with organizational needs, goals, and values. However, personal values, attitudes, beliefs, biases, and prejudices can all affect one’s mental model. A leader’s assumptions play an important role in shaping his or her mental models, but leaders can examine their assumptions and shift or expand mental models when needed to keep their organizations healthy.8

Assumptions In Chapter 4, we discussed two very different sets of attitudes and assumptions that leaders may have about subordinates, called Theory X and Theory Y, and how these assumptions affect leader behavior. A leader’s assumptions naturally are part of his or her mental model. Someone who assumes that people can’t be trusted will act very differently in a situation than someone who has the assumption that people are basically trustworthy. Leaders have assumptions about events, situations, and circumstances as well as about people. Assumptions can be dangerous because people tend to accept them as “truth.”

J.C. Penney provides a good example. Ron Johnson, who helped create the popular and successful Apple retail stores, was hired to save J.C. Penney from a slow death, but he was fired just 17 months into the job. Johnson’s assumptions about the transformation, which included making stores and merchandise more upscale, were based on his experience with what worked at Apple. He created in-store “boutiques” with expensive shelving and signage and pushed stores to stock youthful slim-fitting clothing and European designs, reflecting a shift away from the retailer’s core customers. The problem is that J.C. Penney isn’t Apple. Customers flock to Apple stores for cutting-edge, status-symbol products, but J.C. Penney’s customers want basic clothing and home goods at low prices. Johnson’s remake assumed the only department store customer that mattered was the one “who shops at Target or Macy’s or Nordstrom’s,” said Margaret Bogenrief of ACM Partners.9 It remains to be seen if Myron Ullman III, who returned as CEO when Johnson was pushed out, can work with other top leaders to bring more realistic assumptions to the challenge of reinventing an iconic brand for a new era.

As this example illustrates, it is important for leaders to regard their assump- tions as temporary ideas rather than fixed truths. The more aware a leader is of his or her assumptions, the more the leader understands how assumptions guide behavior and decisions. In addition, the leader can question whether long-held assumptions fit the reality of the current situation. Questioning assumptions can help leaders understand and shift their mental models.

Changing or Expanding Mental Models The mindset of top leaders has always played a key role in organizational success. A Harvard University study ranking the top 100 business leaders of the twentieth century found that they all shared what the researchers refer to as “contextual intelli- gence,” the ability to sense the social, political, technological, and economic context of the times and adopt a mental model that helped their organizations best respond.10

In a world of rapid and discontinuous change, the greatest factor determining the

138 PART 3 THE PERSONAL SIDE OF LEADERSHIP

success of leaders and organizations may be the ability to change or expand one’s mental model.11

Organizations are vulnerable when leaders stick with obsolete mental models in the face of new realities. For example, market share for the BlackBerry smartphone has plummeted in recent years because leaders at Research in Motion stayed with what worked in the past and had a hard time shifting their mental model to keep the company competitive in an environment that changed quickly with the introduction of Apple and Samsung smartphones. On the other hand, leaders at Apple, particularly the late Steve Jobs, have been masters at shifting or expanding their mental models over the years. One researcher who interviewed Steve Jobs said he could “sometimes throw you off balance by suddenly adopting your position as his own, without ever acknowledging that he ever thought differently.” One reason Apple is so successful today, this researcher asserts, is that Steve Jobs was a genius at reframing issues and shifting mental models—his own, his employees’, his partners’, and his customers’. Before the iPhone, no one had ever thought of something like the App Store or the possibility of demanding a share of the revenue from wireless carriers, for instance.12

Unfortunately many leaders become prisoners of their own assumptions and mindsets because these led to success in the past. They find themselves simply going along with the traditional way of doing things—whether it be running a business such as Research in Motion, managing a foundation, handling insurance claims, sell- ing cosmetics, or coaching a basketball team—without even realizing they are making decisions and acting within the limited frame of their own mental model.13

One specific challenge for the mental models of leaders is to navigate through ambiguities and complexities on a global scale that far exceed anything they encounter within their traditional management responsibilities.14 A global mindset can be defined as the ability of managers to appreciate and influence individuals, groups, organizations, and systems that represent different social, cultural, political, institutional, intellectual, or psychological characteristics.15 A manager with a global mindset can perceive and respond to many different perspectives at the same time rather than being stuck in a domestic mental model that sees everything from one’s own limited personal or cultural perspective. One of the best ways managers develop a global mindset is by engaging with people from different cultures. Ken Powell, CEO of General Mills, says being given international positions early in his career convinced him that getting people out of their comfort zone was the best way to develop leaders.16 Some Hollywood movie executives have expanded their mental model to become more successful in overseas markets.

IN THE LEAD Hollywood Studios Hollywood films have long been quintessentially American products, and years ago audi- ences in Japan or Brazil or South Korea would faithfully go watch movies that were written for and marketed primarily to American audiences. Times have changed. Local films in other countries are giving Hollywood a run for its money. At the same time, audiences are declin- ing in the United States but growing overseas. Hollywood movies now get about 70 percent of their revenue from abroad. Hollywood executives are adopting a new mental model that makes movies specifically for certain foreign markets or reframes American films to suit for- eign tastes. Here are some examples:

Global mindset the ability of managers to appreciate and influence in- dividuals, groups, organiza- tions, and systems that represent different social, cultural, political, institutional, intellectual, or psychological characteristics

CHAPTER 5 LEADERSHIP MIND AND EMOTION 139

• For Paramount’s G.I. Joe: The Rise of Cobra and GI Joe: Retaliation, Byung-hun Lee, a major Korean movie star, and South African actor Arnold Vosloo were placed in prominent roles.

• Some recent films, such as Rio and Fast Five, have been set in Brazil, which is a rapidly growing market for Hollywood movies. In The Twilight Saga: Breaking Dawn Part I, Bella Swan and Edward Cullen spend their honeymoon on a private Brazilian island.

• In a recent Transformers movie, DreamWorks Studios had a character gulping Shuhua low-lactase milk from China’s Yili dairy company.

• Pixar’s Cars didn’t do well abroad, so the studio set the sequel in Paris, London, Tokyo, and on the Italian Riviera.

These and other techniques represent a whole new mental model for making movies. Rather than trying to lure audiences to their films, studio leaders are targeting their films to the audiences.17

Leaders at the Hollywood studios have expanded their mental model because they had to in order to make movies cost-effective. “I can tell you that no studio is going to make a big expensive movie that costs $150 million or $200 million unless it has worldwide appeal,” said Mark Zoradi, former president of Walt Disney Company’s Motion Pictures Group. “You can’t pay back that production cost on the domestic model alone.”18

Despite the mental discomfort and sense of disorientation it might cause, lea- ders must allow their mental models to be challenged and even demolished.19

Becoming aware of assumptions and understanding how they influence emotions and actions is the first step toward being able to shift mental models and see the world in a new way. Effective leaders learn to continually question their own beliefs, assumptions, and perceptions in order to see things in unconventional ways and meet the challenge of the future head on.20 Leaders who are unable to see and change their own ineffective mental models often need outside help, as described in this chapter’s Leader’s Bookshelf.

DEVELOPING A LEADER’S MIND How do leaders expand their mental models? The leader’s mind can be developed beyond the nonleader’s in four critical areas: independent thinking, open-mindedness, systems thinking, and personal mastery. Taken together, these four disciplines provide a foundation that can help leaders examine their mental models and over- come blind spots that may limit their leadership effectiveness and the success of their organizations.

Independent Thinking Independent thinking means questioning assumptions and interpreting data and events according to one’s own beliefs, ideas, and thinking, not according to pre-established rules, routines, or categories defined by others. People who think independently are willing to stand apart, to have opinions, to say what they think, and to determine a course of action based on what they personally believe rather than on what other people think or say. Consider the female manager who left

140 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Independent thinking questioning assumptions and interpreting data and events according to one’s own beliefs, ideas, and thinking, rather than pre- established rules or catego- ries defined by others

Ralston Purina for a marketing job at Eveready in the mid-1980s. Eveready had become a household name because of its sales of inexpensive red plastic and metal flashlights, but the flashlight business was in decline. This manager questioned why flashlights couldn’t be made in colors like pink, baby blue, and lime green that would appeal to women—and why weren’t they sold in grocery stores? It wasn’t a popular decision, but once top executives agreed to go along with the new ideas, the flashlight business rebounded.21 Good leadership isn’t about following the rules of others but standing up for what you believe is best for the organization.

To think independently means staying mentally alert and thinking critically. Independent thinking is one part of what is called leader mindfulness.22 Mindfulness can be defined as a state of paying attention to new information and a readiness to create new mental categories in the face of evolving information and shifting cir- cumstances.23 Mindfulness involves independent thinking, and it requires leader curiosity and learning. Mindful leaders are open-minded and stimulate the thinking of others through their curiosity and questions. Mindfulness is the opposite of mindlessness, which means blindly accepting rules and labels created by others. Mindless people let others do the thinking for them, but mindful leaders are always open to new ideas and approaches.

LEADER’S BOOKSHELF What Got You Here Won’t Get You There

by Marshall Goldsmith and Mark Reiter

Success, says executive coach Marshall Goldsmith, makes many people believe they must be doing everything right. Therefore, as leaders move up the hier- archy they often continue to rely on mental models about interpersonal rela- tionships that seemed to work when they were in lower-level positions. Con- sequently, they may sabotage their effectiveness and career advancement. “All other things being equal, your peo- ple skills (or lack of them) become more pronounced the higher up you go,” Goldsmith writes in What Got You Here Won’t Get You There. Goldsmith and his collaborator, Mark Reiter, identify 20 mental habits that damage leader rela- tionships at higher levels.

NOBODY’S PERFECT Every leader has some habits or nega- tive behaviors that can limit his or her effectiveness. Following are a few of the behavioral flaws Goldsmith and Reiter describe. Do you recognize any of these in your own behaviors?

• The Need to Win at All Costs and in All Situations. We all know them— those people who feel like they have

to win every argument and always be right. They want to win the big points, the small points, and everything in between. If they go along with another’s idea that doesn’t work out, they adopt an “I told you so” attitude. In the workplace, a top leader’s need to be right and to point out that he or she is right damages relationships and destroys teamwork.

• Clinging to the Past. There’s noth- ing wrong with looking at and under- standing the past as a way to come to terms with it or learn from it. Too often, though, people cling to the past as a way to blame others for things that have gone wrong in their lives, using the past as a weapon to control others or punish them for not doing exactly what the leader wants.

• Never Being Able to Say You’re Sorry. It’s not true that “love means never having to say you’re sorry.” Apologizing is love in action. Refus- ing to apologize probably causes more ill will—whether in a romance, a family, or a work relationship— than any other interpersonal flaw. “People who can’t apologize at

work may as well be wearing a T-shirt that says: ‘I don’t care about you,’” Goldsmith writes.

CHANGE IS POSSIBLE As an executive coach, Goldsmith has spent his career helping leaders find and fix the mental models that hold them back. His prescription for success can ben- efit any leader who genuinely wants to improve his or her interpersonal relation- ships. The first step is to gather feedback that helps you identify the specific beha- viors you need to change. Next, focus your mind on fixing the problem by apologiz- ing for your behavioral flaws, advertising your efforts to change, listening to ideas from others, showing gratitude for others’ contributions to your change process, and following up on your progress. When you are mindful of your dependence on others, Goldsmith points out, other people typically not only agree to help you be a better person, they also try to become better people themselves.

Source: What Got You Here Won’t Get You There by Marshall Goldsmith and Mark Reiter, is pub- lished by Hyperion Books.

hu tte rs to ck .c om

Mindfulness a state of paying attention to new information and a readiness to create new mental categories in the face of evolving information and shifting circumstances

141 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Being mindful and thinking independently is important for leaders because they can easily become overwhelmed with the amount and variety of tasks that confront them. The deluge of e-mail, text messages, Web conferences, blogs, and so forth has intensified the problem. It is easy to begin doing things on autopilot.24 But in the world of organizations, circumstances are constantly changing. What worked in one situation may not work the next time. In these conditions, mental laziness, operating on autopilot, and accepting others’ answers can hurt the organization and all its members. Consider what happened to entrepreneur Kord Campbell, who failed for 12 days to notice an e-mail from a large company interested in buying his small Internet startup. Why? With the hectic pace of his life, Campbell had been operating on autopilot. “It seems he can no longer be fully in the moment,” says his wife.25

Good leaders apply critical thinking to explore a situation, problem, or question from multiple perspectives and integrate all the available information into a possible solution. When leaders think critically, they question all assumptions, vigorously seek divergent opinions, and try to give balanced consideration to all alternatives.26

Thinking independently and critically is hard work, and most of us can easily relax into temporary mindlessness, accepting black-and-white answers and relying on standard ways of doing things. Leaders at BP have been faulted for deciding to finish work sealing the well at the Deepwater Horizon oil rig in the Gulf of Mexico despite some key pressure test discrepancies. They followed procedures that had worked fine in the past, but this proved to be a fatal decision at Deepwater Horizon. The rig exploded within hours, killing 11 workers and leaving oil on beaches from Louisiana to Florida.27

Good leaders also encourage followers to be mindful rather than mindless. Bernard Bass, who has studied charismatic and transformational leadership, talks about the value of intellectual stimulation—arousing followers’ thoughts and imagi- nations as well as stimulating their ability to identify and solve problems crea- tively.28 People admire leaders who awaken their curiosity, challenge them to think and learn, and encourage openness to new, inspiring ideas and alternatives.

Open-Mindedness The power of the conditioning that limits our thinking and behavior is illustrated by what has been called the Pike Syndrome. In an experiment, a northern pike is placed in one half of a large glass-divided aquarium, with numerous minnows placed in the other half. The hungry pike makes repeated attempts to get the min- nows but succeeds only in battering itself against the glass, finally learning that try- ing to reach the minnows is futile. The glass divider is then removed, but the pike makes no attempt to attack the minnows because it has been conditioned to believe that reaching them is impossible. When people assume they have complete knowl- edge of a situation because of past experiences, they exhibit the Pike Syndrome, a trained incapacity that comes from rigid commitment to what was true in the past and an inability to consider alternatives and different perspectives.29

Leaders have to forget many of their conditioned ideas to be open to new ones. This openness—putting aside preconceptions and suspending beliefs and opinions— can be referred to as “beginner’s mind.” When someone becomes an expert in a particular subject, their mind often becomes closed to the perspectives of other peo- ple. Psychologist Elizabeth Newton conducted an experiment in which she gave one set of people, called “tappers,” a list of well-known songs and asked them to rap their knuckles on a tabletop to the rhythm of the tunes. Another set of people, called “listeners,” were asked to name the songs. The tappers said they thought

NEW LEADER ACTION MEMO Evaluate your skill in three dimensions of mindfulness, in- cluding intellectual stimulation, by completing the exercise in Leader’s Self-Insight 5.1

142 PART 3 THE PERSONAL SIDE OF LEADERSHIP

listeners would get the songs right about half the time. In reality, the listeners guessed only 3 out of 120 songs that were tapped. The tappers might be considered to have “expert minds” in this situation. The song was so clear in their minds that they couldn’t understand how the listeners could not hear it.30

The expert mind becomes a danger in organizations because it rejects new ideas based on past experience and knowledge. This danger of the expert mind’s conclu- sions becomes frighteningly clear when it comes to the field of medicine. Doctors get their diagnoses wrong 15 to 20 percent of the time because they rely on stan- dard ways of thinking and past experience. Many of these errors in judgment result in serious harm or death. Dr. Jerome Groopman, author of How Doctors Think, now teaches students at Harvard Medical School to avoid common traps such as

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 5.1

Mindfulness

Instructions: Think back to how you behaved toward others at work or in a group when you were in a formal or informal leadership position. Please respond to the following items based on how frequently you exhibited each behavior. Indi- cate whether each item is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. Enjoyed hearing new ideas. 2. Challenged someone to think

about an old problem in a new way.

3. Tried to integrate conversation points at a higher level.

4. Felt appreciation for the view- points of others.

5. Would ask someone about the assumptions underlying his or her suggestions.

6. Came to my own conclusion de- spite what others thought.

7. Was open about myself to others. 8. Encouraged others to express

opposing ideas and arguments. 9. Fought for my own ideas.

10. Asked “dumb” questions. 11. Offered insightful comments on

the meaning of data or issues. 12. Asked questions to prompt others

to think more about an issue. 13. Expressed a controversial

opinion. 14. Encouraged opposite points of

view. 15. Suggested ways of improving my

and others’ ways of doing things.

Scoring and Interpretation Give yourself one point for each Mostly True checked for items 1–8 and 10–15. Give yourself one point for checking Mostly False for item 9. A total score of 12 or higher would be consid- ered a high level of overall mindfulness. There are three sub- scale scores that represent three dimensions of leader mindfulness. For the dimension of open or beginner’s mind, sum your responses to questions 1, 4, 7, 9, and 14. For the dimension of independent thinking, sum your scores for ques- tions 3, 6, 11, 13, and 15. For the dimension of intellectual stimulation, sum your scores for questions 2, 5, 8, 10, and 12.

My scores are: Open or Beginner’s Mind: Independent Thinking: Intellectual Stimulation:

These scores represent three aspects of leader mindfulness—what is called open mind or beginner’s mind, independent thinking, and intellectual stimulation.

A score of 4 or higher on any of these dimensions is considered high because many people do not practice mindfulness in their leadership or group work. A score of 3 is about average, and 2 or less would be below average. Compare your three subscale scores to understand the way you use mindfulness. Analyze the specific questions for which you did not get credit to see more deeply into your pattern of mindfulness strengths or weaknesses. An open mind, independent thinking, and intellectual stimulation are valuable qualities to develop for effective leadership.

Sources: The questions above are based on ideas from R.L. Daft and R.M. Lengel, Fusion Leadership, Chapter 4 (Berrett Koehler, 2000); B. Bass and B. Avolio, Multifactor Leadership Questionnaire, 2nd ed. (Mind Garden, Inc.); and P.M. Podaskoff, S.B. MacKenzie, R.H. Moorman, and R. Fetter, “Transformational Leader Behaviors and Their Effects on Followers’ Trust in Leader, Satisfaction, and Organizational Citizenship Behaviors,” Leadership Quarterly 1, no. 2 (1990), pp. 107–142.

| D re am

st im e. co m

143 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

the one he fell into early in his career. As a young doctor, he listened to the complaints of an elderly patient and quickly concluded that she had indigestion. The medication he gave her provided little relief, but his mind was fixed on his initial diagnosis. As it turned out, the patient had a tear in her aorta and died in the emergency room several weeks later. It’s a lesson Groopman never forgot.31

In contrast to the expert mind, the beginner’s mind reflects the openness and innocence of a young child just learning about the world. Effective leaders strive to keep open minds and cultivate an organizational environment that encourages curiosity and learning. They understand the limitations of past experience and reach out for diverse perspectives. Rather than seeing any questioning of their ideas as a threat, these leaders encourage everyone to openly debate assumptions, confront paradoxes, question perceptions, and express feelings.32

Systems Thinking Systems thinking is the ability to see the synergy of the whole rather than just the separate elements of a system and to learn to reinforce or change whole system patterns.33 With systems thinking, a leader sees the big picture and connects the dots rather than just looking at the dots in isolation. Many people have been trained to solve problems by breaking a complex system, such as an organization, into discrete parts and working to make each part perform as well as possible. However, the success of each piece does not add up to the success of the whole. In fact, sometimes changing one part to make it better actually makes the whole system function less effectively. For example, a small city embarked on a road- building program to solve traffic congestion without whole-systems thinking. With new roads available, more people began moving to the suburbs. The solution actu- ally increased traffic congestion, delays, and pollution by enabling suburban sprawl.34

It is the relationship among the parts that form a whole system—whether it be a community, an automobile, a nonprofit agency, a human being, or a business organization—that matters. Systems thinking enables leaders to look for patterns of movement over time and focus on the qualities of rhythm, flow, direction, shape, and networks of relationships that accomplish the performance of the whole. Systems thinking is a mental discipline and framework for seeing patterns and interrelationships.

It is important to see organizational systems as a whole because of their com- plexity. Complexity can overwhelm leaders, undermining confidence. When leaders can see the structures that underlie complex situations, they can facilitate improve- ment. But it requires a focus on the big picture. Leaders can develop what David McCamus, former chairman and CEO of Xerox Canada, calls “peripheral vision”—the ability to view the organization through a wide-angle lens rather than a telephoto lens—so that they perceive how their decisions and actions affect the whole.35

An important element of systems thinking is to discern circles of causality. Peter Senge, author of The Fifth Discipline, argues that reality is made up of circles rather than straight lines. For example, Exhibit 5.3 shows circles of influence for increas- ing a retailer’s profits. The events in the circle on the left are caused by the decision to increase the advertising budget to aggressively promote products. The advertising promotions increase sales, which increases profits, which provides money to further increase the advertising budget.

NEW LEADER ACTION MEMO As a leader, you can train yourself to think independently. You can be curious, keep an open mind, and look at a problem or situation from multiple perspectives before reaching your conclusions.

To assess your systems think- ing, log in to CengageNOW to complete the interactive questionnaire.

NEW LEADER ACTION MEMO As a leader, you can cultivate an ability to analyze and understand the relationships among parts of a team, orga- nization, or other system to avoid making changes that have unintended negative consequences.

144 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Systems thinking the ability to see the synergy of the whole rather than just the separate elements of a system and to learn to reinforce or change whole system patterns

But another circle of causality is being influenced as well. The decision by leaders in marketing has consequences for the operations department. As sales and profits increase, the operations department is forced to stock up with greater inventory. Additional inventory creates a need for more warehouse space. Building a new warehouse causes a delay in stocking up. After the warehouse is built, new people have to be hired. All of this increases company costs, which has a negative impact on profits. Thus, understanding the consequences of their decisions via circles of causality enables leaders to plan and allocate resources to warehousing as well as to advertising to ensure stable increases in sales and profits. Without understanding the system, top leaders would fail to understand why increasing the advertising budget could actually create inventory delays and temporarily reduce profits.

Personal Mastery Another concept introduced by Senge is personal mastery. Personal mastery means mastering yourself in a way that facilitates your leadership and achieves desired results.36 Mastering yourself embodies three qualities—clarity of mind, clarity of objectives, and organizing to achieve objectives.

First, clarity of mind means a commitment to the truth of current reality. Leaders are relentless in uncovering the mental models that limit and deceive them and are willing to challenge assumptions and standard ways of doing things. These leaders will break through denial of reality in themselves and others. Their quest for truth leads to a deeper awareness of themselves and of the larger systems and events within which they operate. Clarity of mind enables them to deal with reality, which increases the opportunity to achieve desired results.

Second, leaders engaged in personal mastery know what is important to them so that their objectives are clear. Clarity of objectives helps leaders focus on the end

EXHIBIT 5.3 Systems Thinking and Circles of Causality

Source: Based on concepts presented in Peter M. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization (New York: Doubleday/Currency, 1990).

Self-discipline is a form of freedom. Freedom from lazi- ness and lethargy, freedom from the expectations and demands of others, freedom from weakness and fear—and doubt. Self- discipline allows a [person] to feel his individuality, his inner strength, his talent. He is master of, rather than a slave to, his thoughts and emotions.

H. A. Dorfman, author of The Mental

Game of Baseball

CHAPTER 5 LEADERSHIP MIND AND EMOTION 145

Personal mastery the discipline of mastering yourself; it embodies clarity of mind, clarity of objectives, and organizing to achieve objectives

result, the vision or dream that motivates them and their team or organization. They have a clear vision of a desired future, and their purpose is to achieve that future. One element of personal mastery, then, is the discipline of continually focus- ing and defining what one wants as the desired future.

Third, often there is a large gap between one’s vision and the current situation. The gap between the desired future and today’s reality, say between the dream of starting a business and the reality of having no capital, can be discouraging. But the gap is the source of creative energy. Organizing to achieve objectives is a way to bridge the disparity between current reality and the vision of a better future. The effective leader lets the vision pull reality toward it by reorganizing current activities to work toward the vision. The less effective way is to let reality pull the vision downward toward it. This means lowering the vision, such as walking away from a problem or settling for less than desired. Leaders with personal mastery learn to accept both the dream and the reality simultaneously and to close the gap by mov- ing toward the dream.

All five elements of mind are interrelated. Independent thinking and open- mindedness improve systems thinking and enable personal mastery, helping leaders shift and expand their mental models. Since they are all interdependent, leaders working to improve even one element of their mental approach can move forward in a significant way toward mastering their minds and becoming more effective.

EMOTIONAL INTELLIGENCE Psychologists and other researchers, as well as people in all walks of life, have long recognized the importance of cognitive intelligence, or IQ, in determining a person’s success and effectiveness. In general, research shows that leaders score higher than most people on tests of cognitive ability, such as IQ tests, and that cog- nitive ability is positively associated with effective leadership.37 Increasingly, leaders and researchers are recognizing the critical importance of emotional intelligence, or EQ, as well. Some have suggested that emotion, more than cognitive ability, drives our thinking and decision making, as well as our interpersonal relationships.38 In a study of leaders, two-thirds of the difference between average and top-performing leaders was found to be due to emotional competence, with only one-third due to technical skills.39

Emotional intelligence refers to a person’s abilities to perceive, identify, under- stand, and successfully manage emotions in self and others. Being emotionally intelligent means being able to effectively manage ourselves and our relation- ships.40 The U.S. Air Force started using EQ to select recruiters after learning that the best recruiters scored higher in EQ competencies. Leaders who score high in EQ are typically more effective and rated as more effective by peers and subordinates.41

What Are Emotions? There are hundreds of emotions and more subtleties of emotion than there are words to explain them. An important ability for leaders is to understand the range of emotions people have and how these emotions may manifest themselves. One model that is useful for leaders distinguishes the major positive and negative

146 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Emotional intelligence a person’s abilities to per- ceive, identify, understand, and successfully manage emotions in self and others

emotions, as illustrated in Exhibit 5.4.42 These primary emotions and some of their variations are as follows:

• Anger: fury, outrage, frustration, exasperation, indignation, animosity, annoyance, irritability, hostility

• Sadness: grief, sorrow, gloom, melancholy, self-pity, loneliness, dejection, despair, discouragement

• Relief: release, reassurance, ease, contentment • Fear: anxiety, apprehension, nervousness, concern, consternation, wariness, edgi-

ness, dread, fright, terror, panic • Enjoyment: happiness, joy, delight, amusement, sensual pleasure, thrill, rapture,

euphoria • Love: affection, acceptance, respect, friendliness, trust, kindness, affinity, devotion,

adoration, infatuation • Envy: jealousy, resentment, suspicion, spite • Disgust: contempt, disdain, scorn, abhorrence, aversion, distaste, revulsion • Pride: satisfaction, dignity, self-esteem, fulfillment • Guilt: shame, embarrassment, chagrin, remorse, humiliation, regret, mortification,

contrition

Some leaders act as if people leave their emotions at home when they come to work, but we all know this isn’t true. Indeed, a key component of leadership is being emotionally connected to others and understanding how emotions affect working relationships and performance.

EXHIBIT 5.4 Positive and Negative Emotions

20 15

CHAPTER 5 LEADERSHIP MIND AND EMOTION 147

Why Are Emotions Important? In a study of entrepreneurs, researchers at Rensselaer Polytechnic Institute found that those who are more expressive of their own emotions and more in tune with the emotions of others make more money, as illustrated in Exhibit 5.5.43 One reason for this is that leaders who harness and direct the power of emotions to improve followers’ satisfaction, morale, and motivation get better results and enhance overall organizational effectiveness.

Emotions Are Contagious The emotional state of the leader influences the entire team, department, or organization.44 Most of us recognize that we can “catch” emotions from others. If we’re around someone who is smiling and enthusiastic, the positive emotions rub off on us. Conversely, someone in a bad mood can bring us down. At Mesa Airlines, CEO Jonathan Ornstein’s former administrative assistant says she was in charge of tracking the unpredictable and frequently short- tempered leader’s moods and warning other executives when they needed to stay away. “Sometimes he would come into the office in a bad mood … and it would set the tone for the whole office,” she says.45 This emotional contagion means that leaders who are able to maintain balance and keep themselves motivated can serve as positive role models to help motivate and inspire those around them. The energy level of the entire organization increases when leaders are optimistic and hopeful rather than angry or depressed. Interesting new research by organization behavior scientists suggests that negative emotions might spread more easily than positive ones because people’s positive emotions are generally less influenced by other people. Psychologists have also found that negative people and events have a disproportionately large effect on our emotions and moods.46

Therefore, leaders recognize the importance not only of keeping their own emo- tions in balance but also helping others manage negative emotions so they don’t infect the entire team or organization. Leaders “tune in” to the emotional state of others, bring unhealthy or negative emotions to the surface, and encourage people to explore and use positive emotion in their everyday work.47 One study found that untrained teams made up of members with high emotional intelligence performed as well as trained teams made up of members who rated low on emotional intelligence.48

EXHIBIT 5.5 Emotional Intelligence and Earning Power

Source: Rensselaer Polytechnic Institute, Lally School of Management and Technology, as reported in BusinessWeek Frontier (February 5, 2001), p. F4.

148 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Emotions Influence Performance As suggested by the team study just mentioned, emotions have a strong influence on performance. Much evidence points to a clear connection between people’s moods and various aspects of their performance, such as teamwork, creativity, decision making, and task performance.49 Negative moods drain energy and prevent people from doing their best.

An entire organization in a bad mood can’t succeed because people have no energy and feel anxious, disillusioned, or hopeless. In this kind of toxic work environment, most of an individual’s effort is used for emotional survival, as illustrated in Exhibit 5.6. In a positive environment, on the other hand, most of a person’s effort is available for work. When a leader is able to unlock positive emotions of joyfulness, appreciation, or love, people’s energy, creativity, and intellectual commitment expand. Employees are able to grasp more data, be more creative and resourceful in their solutions, and produce superior results. Positive emotions mean the decline of negative emotions such as sadness, anger, anxiety, and fear. Positive instead of negative emotions enable individuals to perform to the best of their abilities.50

A Gallup Management Journal survey emphasizes that leaders, especially front- line supervisors, have a lot to do with whether employees have positive or negative feelings about their work lives.51 Research into the factors affecting mood in the workplace is growing. One thing seems clear: almost everything that influences peo- ple’s moods in the workplace is under the control of leaders.52 That is why leaders need a high degree of emotional intelligence. They have to regulate their own emo- tions to remain positive and hopeful and then pull others up with them.

The Components of Emotional Intelligence In discussing Abraham Lincoln’s leadership, noted historian Doris Kearns Goodwin attributes the 16th U.S. president’s almost magical touch not to charisma or political astuteness but to emotional intelligence.53 The competencies and abilities of emo- tional intelligence are grouped into four fundamental categories, as illustrated in Exhibit 5.7.54 It is important to remember that emotional intelligence can be learned and developed. Anyone can strengthen his or her abilities in these four categories.

EXHIBIT 5.6 Positive Leadership and Performance

Source: Based on “Success & the Team Climate,” Team Leadership Toolkit, Lindsay-Sherwin Company Website, http://www.lindsay -sherwin.co.uk/guide_team_leadership/html_team_development/1_success_and_team_climate.htm (accessed May 13, 2011).

CHAPTER 5 LEADERSHIP MIND AND EMOTION 149

Self-Awareness Self-awareness includes the ability to recognize and understand your own emotions and how they affect your life and work. It is the basis of all the other competencies. People who are in touch with their emotions are better able to guide their own lives. Leaders with a high level of self-awareness learn to trust their “gut feelings” and realize that these feelings can provide useful informa- tion about difficult decisions. Answers are not always clear as to whether to pro- pose a major deal, let an employee go, reorganize a business, or revise job responsibilities. When the answers are not available from external sources, leaders have to rely on their own feelings. This component also includes the ability to accu- rately assess your own strengths and limitations, along with a healthy sense of self- confidence.

Self-Management The second key component, self-management, includes the ability to control disruptive, unproductive, or harmful emotions and desires. An interesting experiment from the 1960s sheds some light on the power of self-management. A group of four-year-olds and five-year-olds were offered a marshmallow, which the researcher placed in front of each child on the desk. Then, the children were told that if they could wait a few minutes while the researcher ran an errand, they would be given two marshmallows. Some children were unable to resist the tempta- tion of a marshmallow “right now” and ate theirs immediately. Others employed all sorts of techniques, from singing or talking to themselves to hiding under the desk, to resist their impulses and earn the reward of two marshmallows instead of one. Researchers then followed the children over a period of 20 years and found some interesting results. As young men and women, the ones who had resisted the desire to eat the marshmallow revealed a much higher ability to handle stress and embrace difficult challenges. They also were more self-confident, trustworthy, dependable,

EXHIBIT 5.7 The Components of Emotional Intelligence

Source: Adapted from Richard E. Boyatzis and Daniel Goleman, The Emotional Competence Inventory–University Edition (Boston, MA: The Hay Group, 2001).

150 PART 3 THE PERSONAL SIDE OF LEADERSHIP

and tenacious in pursuing goals.55 The children who developed techniques for self-management early in life carried these with them into adulthood.

It is never too late for people to learn how to manage their emotions and impulses. Some leaders look to expert customer service representatives (CSRs) as role models. Research shows that 70 percent of customers who have a problem with a product or service are in a rage by the time they talk with a CSR. The best CSRs, such as Beverly Smith, who takes outpatient calls at a San Francisco medical center, and Zane Bond, who is the “go-to guy for angry callers” at a software company, have learned to con- trol their own emotions, remain calm, and listen with warmth and empathy. When the customer calms down, the problem can usually be fixed.56

Other characteristics in this category include trustworthiness, which means con- sistently displaying honesty and integrity; conscientiousness, which means manag- ing and honoring your responsibilities; and adaptability, which refers to the ability to adjust to changing situations and overcome obstacles. Showing initiative to seize opportunities and achieve high internal standards is also a part of self-management. Leaders skilled at self-management remain hopeful and optimistic despite obstacles, setbacks, or even outright failures. Martin Seligman, a professor of psychology at the University of Pennsylvania, once advised the MetLife insurance company to hire a special group of job applicants who tested high on optimism but failed the normal sales aptitude test. Compared to salespeople who passed the regular apti- tude test but scored high on pessimism, the “optimistic” group made 21 percent more sales in their first year and 57 percent more in the second.57

Social Awareness The component of social awareness relates to one’s ability to understand others. Socially aware leaders practice empathy, which means being able to put yourself in other people’s shoes, sense their emotions, and understand their perspective. These leaders understand that effective leadership sometimes means pushing people beyond their comfort zone, and they are sensitive to the fear or frustration this can engender in followers. They learn to engage in “profes- sional intimacy,” which means they can display compassion and concern for others without becoming so wrapped up in others’ emotions that it clouds their judg- ment.58 Socially aware leaders are also capable of understanding divergent points of view and interacting effectively with many different types of people and emo- tions. The related characteristic of organizational awareness refers to the ability to navigate the currents of organizational life, build networks, and effectively use political behavior to accomplish positive results. This component also includes a service orientation, which refers to the ability to recognize and serve the needs of employees, customers, or clients.

Relationship Management Relationship management refers to the ability to con- nect with others and build positive relationships. Leaders with high emotional intelligence are aware of the impact their behaviors have on others, and they treat people with compassion, sensitivity, and kindness.59 This aspect of EQ encompasses developing others, inspiring others with a powerful vision, learning to listen and communicate clearly and convincingly, and using emotional under- standing to influence others in positive ways. Leaders use their understanding of emotions to inspire change and lead people toward something better, to build teamwork and collaboration, and to resolve conflicts that inevitably arise. These leaders cultivate and maintain a web of relationships both within and outside the organization.

NEW LEADER ACTION MEMO As a leader, you can recognize and manage your own emo- tions so that negative feelings don’t cloud your mind, distort your judgment, or cripple your ability to lead.

CHAPTER 5 LEADERSHIP MIND AND EMOTION 151

Empathy being able to put yourself in someone else’s shoes

Poor relationship management is one reason Jack Griffin was forced out as CEO of Time Inc. after less than six months on the job. His brusque style and inability to connect with managers doomed his job with Time. Senior executives said they feared that top managers who had to work directly with him would begin leaving the company if Griffin stayed on much longer.60

Taken together, the four components shown in Exhibit 5.7 build a strong base of emotional intelligence that leaders can use to more effectively guide teams and organizations. One research project suggests that all effective leadership styles arise from different components of emotional intelligence.61 Consider how two football coaches used emotional intelligence to effectively lead teams to the NFL Super Bowl.

IN THE LEAD John Harbaugh, Baltimore Ravens, and Jim Harbaugh, San Francisco 49ers Tony Dungy did it with the Indianapolis Colts football team. Joe Torre did it with the New York Yankees in baseball. Now brothers John and Jim Harbaugh are doing it with the Baltimore Ravens and San Francisco 49ers. Each of these coaches has been noted for a new approach to sports team leadership—using emotional intelligence to bring out the best in players.

The Harbaughs, who gained the world’s attention when their teams competed against each other in the NFL Super Bowl in 2013, both created cultures that inspired players to connect with one another and accomplish amazing results. Everything about leading a foot- ball team, they believe, comes down to relationships. Jim Harbaugh makes a point of talking with his players and coaches about their families and lives off the field. John Harbaugh grounds his leadership in solid values and principles, but allows players to make many deci- sions. “It’s never been my way or the highway,” he says. Both coaches emphasize listening as a key to success.62

John and Jim Harbaugh have created the kind of workplace that many of today’s organizations want—one in which leaders are more interactive than “command-and-control,” where leadership is spread across all levels, and where individual goals are met through teamwork, connection, and collaboration. In an environment where relationships with employees and customers are becoming more important than technology and material resources, interest in developing lea- ders’ emotional intelligence continues to grow. Moreover, there is growing evidence that emotional intelligence has a positive influence on many aspects of leader performance.63

A high level of self-awareness and an ability to manage one’s own emotions enable a leader to display self-confidence, earn respect and trust, and consider the needs of others. Emotionally competent leaders are more resilient, more adaptable to ever-changing circumstances, more willing to step outside their comfort zone, and more open to the opinions and ideas of others.64

Perhaps most importantly, emotional intelligence enables leaders to recognize and respect followers as whole human beings with feelings, opinions, and ideas of their own. They can use their emotional intelligence to help followers grow and develop, see and enhance their self-image and feelings of self-worth, and help meet their needs and achieve personal and organizational goals.

NEW LEADER ACTION MEMO As a leader, you can empathize with others, treat people with compassion and sensitivity, build teamwork, and learn to listen, interpret emotions, and resolve interpersonal conflicts.

NEW LEADER ACTION MEMO Evaluate your level of emo- tional intelligence by complet- ing the questionnaire in Leader’s Self-Insight 5.2.

NEW LEADER ACTION MEMO As a leader, you can develop emotional intelligence and act as a positive role model by being optimistic and enthusiastic.

152 PART 3 THE PERSONAL SIDE OF LEADERSHIP

LEADING WITH LOVE VERSUS LEADING WITH FEAR Traditionally, leadership has been based on inspiring fear in employees. An unspo- ken notion among many senior-level executives is that fear is a good thing and ben- efits the organization.65 Indeed, fear can be a powerful motivator, but many of today’s leaders are learning that an environment that reflects care and respect for people is much more effective than one in which people are fearful. When organiza- tional success depended primarily on people mindlessly following orders, leading with fear often met the organization’s needs. Today, though, success in most orga- nizations depends on the knowledge, mindpower, commitment, creativity, and enthusiasm of everyone in the organization. A fear-based organization loses its best people, and the knowledge they take with them, to other firms. In addition,

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 5.2

Emotional Intelligence

Instructions: For each of the following items, rate how well you display the behavior described. Before responding, try to think of actual situations in which you have had the opportunity to use the behavior. Indicate whether each item below is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. Associate different internal physiological cues with different emotions.

2. Relax when under pressure in situations.

3. Know the impact that your be- havior has on others.

4. Initiate successful resolution of conflict with others.

5. Know when you are becoming angry.

6. Recognize when others are distressed.

7. Build consensus with others. 8. Produce motivation when doing

uninteresting work. 9. Help others manage their

emotions. 10. Make others feel good. 11. Identify when you experience

mood shifts. 12. Stay calm when you are the

target of anger from others. 13. Know when you become

defensive. 14. Follow your words with actions.

15. Engage in intimate conversations with others.

16. Accurately reflect people’s feel- ings back to them.

Scoring and Interpretation Sum your Mostly True responses to the 16 questions to obtain your overall emotional intelligence score. Your score for self-awareness is the total of questions 1, 5, 11, and 13. Your score for self-management is the total of questions 2, 8, 12, and 14. Your score for social awareness is the sum of questions 3, 6, 9, and 15. Your score for relationship man- agement is the sum of questions 4, 7, 10, and 16. This ques- tionnaire provides some indication of your emotional intelligence. If you received a total score of 14 or more, you are certainly considered a person with high emotional intelligence. A score from 10 to 13 means you have a good platform of emotional intelligence from which to develop your leadership capability. A score of 7 to 9 would be mod- erate emotional intelligence. A score below 7 indicates that you realize that you are probably below average in emo- tional intelligence.

For each of the four components of emotional intelligence—self-awareness, self-management, social aware- ness, and relationship management—a score of 4 is consid- ered high, whereas a score of 2 or fewer would be considered low. Review the discussion in this chapter about the four components of emotional intelligence and think about what you might do to develop those areas where you scored low. Compare your scores to those of other students. What can you do to improve your scores?

Source: Adapted from Hendrie Weisinger, Emotional Intelligence at Work (San Francisco: Jossey-Bass, 1998), pp. 214–215.

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NEW LEADER ACTION MEMO To learn about your own motivations concerning love versus fear, complete the exercise in Leader’s Self-Insight 5.3.

153 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

even if people stay with the organization, they typically don’t perform up to their real capabilities. As discussed earlier, there is evidence that people who experience positive emotions at work perform better.66

Showing respect and trust also allows people to feel emotionally connected with their work so that their lives are richer and more balanced. Leaders can rely on nega- tive emotions such as fear to fuel productive work, but by doing so they may slowly destroy people’s spirits, which ultimately is bad for employees and the organization.67

Consider, for example, that two-thirds of employees surveyed said their performance declined after being the victim of rudeness or hostility at work. Four out of five said they lost work time fretting about the unpleasant incident, three-quarters said their commitment to their employer declined, and 12 percent even quit their jobs.68

Fear in Organizations The workplace can hold many kinds of fear, including fear of failure, fear of change, fear of personal loss, fear of being judged, and fear of the boss. All of these fears can prevent people from doing their best, from taking risks, and from challenging and changing the status quo. Consider how Akshay Kothari and Ankit Gupta had to overcome their fears to create one of the 50 original apps in Apple’s App Store Hall of Fame.

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 5.3

Love or Fear?

Instructions: The following items describe reasons why you work. Answer the questions twice, the first time for doing work (or homework) that is not your favorite and the second time for doing a hobby or sports activity that you enjoy. Consider each item thoughtfully and respond according to your inner motivation and experience. Indicate whether each item below is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I feel it is important to perform well so I don’t look bad.

2. I have to force myself to com- plete the task.

3. I don’t want to have a poor out- come or get a poor grade.

4. I don’t want to embarrass myself or do less well than others.

5. The experience leaves me feeling relieved that it is over.

6. My attention is absorbed entirely in what I am doing.

7. I really enjoy the experience. 8. Time seems to pass more quickly

than normal. 9. I am completely focused on the

task at hand.

10. The experience leaves me feeling great.

Scoring and Interpretation These items reflect motivation shaped by either love or fear. Your “fear of failure” score is the number of Mostly True answers for questions 1–5. Your “love of task” score is the number of Mostly True answers for questions 6–10. A score of 4 or 5 would be considered high for either love or fear, and a score of 0–2 would be considered low. You would probably score more points for “love of task” for your hobby or sports activity than for homework.

Some people are motivated by high internal standards and fear of not meeting those standards. This may be called fear of failure, which often spurs people to great accom- plishment. Love of task provides a great intrinsic pleasure but won’t always lead to high achievement. Love of task is related to the idea of “flow” wherein people become fully engaged and derive great satisfaction from their activity. Would love or fear influence your choice to become a leader or how you try to motivate others? Discuss with other stu- dents the relative importance of love or fear motivation in your lives.

Love in the workplace means genuinely caring for others and sharing one’s knowledge, understanding, and compassion to enable others to grow and succeed.

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154 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

IN THE LEAD Akshay Kothari and Ankit Gupta, Pulse News Akshay Kothari and Ankit Gupta were graduate students at Stanford University’s acclaimed d.school (formally known as the Hasso Plattner Institute of Design) when they took a class designed to get people out of their comfort zone so they could confront and overcome the fears that stand in the way of creativity and goal achievement.

Both were self-described “geeks.” Although they were technically brilliant, shyness often prevented them from pursuing goals that involved too much interaction with people. To fight the fear, they decided to work on their class project—a news reader for the then newly released iPad—at a café off campus. Approaching strangers and asking for feedback on their ideas and prototype was definitely a stretch for the two, and the negative feedback often hurt.

But, over time, Akshay says, they went “from people saying ‘This is crap,’ to ‘Is this app preloaded on every iPad?‘” The result of their project, Pulse News, was praised by Steve Jobs at a worldwide developer’s conference, won the prestigious Apple Design award, and has been downloaded by more than 20 million people.69

Overcoming their fears not only enabled Akshay Kothari and Ankit Gupta to complete a successful class project, it gave them the confidence to found a company that revolutionized the mobile news reading experience. Pulse is expanding into social media with the addition of Pulse Highlights, which allows users to see when their friends have shared the story they are reading. That means people can go to Pulse not only to read content from sites they trust but also to discover new sources and stories.70

Consequences of Fear Fear gets in the way of people feeling good about their work, themselves, and the organization. It creates an atmosphere in which people feel powerless, so that their confidence, commitment, enthusiasm, imagination, and motivation are diminished.71 One major drawback of leading with fear is that it creates avoidance behavior because no one wants to make a mistake. Fear in the workplace weakens trust and communication. Employees feel threat- ened by repercussions if they speak up about work-related concerns. A survey of employees in 22 organizations found that 70 percent of them “bit their tongues” at work because they feared repercussions. Twenty-seven percent reported that they feared losing their credibility or reputation if they spoke up. Other fears reported were lack of career advancement, possible damage to the relationship with their supervisor, demotion or losing their job, and being embarrassed or humiliated in front of others.72 When people are afraid to speak up, important issues are suppressed and problems hidden. Employees are afraid to talk about a wide range of issues, but by far the largest category of “undiscussables” is the behavior of executives, particularly their interpersonal and relationship skills. When leaders inspire fear, they destroy the opportunity for feedback, blinding them to reality and denying them the chance to correct damaging decisions and behaviors.

NEW LEADER ACTION MEMO As a leader, you can choose to lead with love, not with fear. You can show respect and trust toward followers and help people learn, grow, and con- tribute their best to achieve the organization’s vision.

CHAPTER 5 LEADERSHIP MIND AND EMOTION 155

Relationship with Leaders Leaders control the fear level in the organization. Exhibit 5.8 outlines some indicators of love-based versus fear-based leadership in organizations.73

Organizations driven by love are marked by openness and authenticity, a respect for diverse viewpoints, and emphasis on positive interpersonal relationships. Organizations driven by fear, on the other hand, are characterized by cautiousness and secrecy, blaming others, excessive control, and emotional distance among people. The relationship between an employee and his or her direct supervisor is the primary factor determining the level of fear experienced at work. Unfortunately, the legacy of fear and mistrust asso- ciated with traditional hierarchies in which bosses gave orders and employees jumped to obey “or else” still colors life in many organizations. Leaders can create a new environ- ment that enables people to feel safe speaking their minds. Leaders can act from love rather than fear to free employees and the organization from the chains of the past.

Bringing Love to Work Leaders can learn to bind people together for a shared purpose through positive forces such as caring and compassion, listening, and connecting to others on a per- sonal level. The emotion that attracts people to take risks, learn, grow, and move the organization forward comes from love, not fear. Leaders should also remember that love is more than a feeling; to be a real force, it is translated into behavior.

EXHIBIT 5.8 Indicators of Love versus Fear in Organizations

Fear-Driven Indicators Love-Driven Indicators

Caution and secrecy Openness and authenticity, even when it’s difficult Blaming and attacking Understanding diverse viewpoints Excessive control Expecting others to do great things Sideline criticalness Involvement and discernment Coming unglued Keeping perspective Aloofness and distance Interpersonal connection Resistance hidden Resistance out in open, explored

Consider The Greatest Is Love

Army Staff Sgt. Ian Newland saw the enemy grenade land in his Humvee. In the next instant, his friend Ross McGinnis threw himself onto that grenade. “I try not to live my life in vain for what he’s done,” said Newland. When asked why McGinnis did it, Newland simply said, “He loved us.”

During the Iraq war, at least five U.S. soldiers died because they used their own bodies to shield their comrades from grenades. “What a decision that is,” said Temple University psychologist Frank Farley. “I can’t think of anything more profound in human nature.” A Navy lieutenant said of a comrade who sacrificed his life by blocking a grenade thrown onto a rooftop near his team, “You think about him every day. And everything pretty much revolves around what he did.”

Source: Based on Gregg Zoroya, “Coping After a Hero Dies Saving You in Iraq,” USA Today (September 20, 2007).

156 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Stephen Covey points out that in all the great literature, love is a verb rather than a noun.74 Love is something you do, the sacrifices you make, and the giving of yourself to others, as illustrated by the poignant story in this chapter’s Consider This! on page 156.

Organizations have traditionally rewarded people for strong qualities such as ratio- nal thinking, ambition, and competitiveness. These qualities are important, but their overemphasis has left many organizational leaders out of touch with their softer, caring, creative capabilities, unable to make emotional connections with others and afraid to risk showing any sign of weakness or emotion. What does it mean to lead with love? In all groups and organizations feelings of compassion, respect, and loyalty are trans- lated into action, such as acts of friendliness, teamwork, cooperation, listening, under- standing, and serving others above oneself. Sentiments emerge as action. Exhibit 5.9 shows results of an exercise in which people reported what they do to show others they care and what if feels like to be cared about. Leaders who fail often do so because they are blind to the importance of the attributes in Exhibit 5.9. Sometimes leaders act from their own fear, which creates fear in others. A leader’s fear can manifest itself in arrogance, selfishness, deception, unfairness, and disrespect for others.75

Why Followers Respond to Love Most people yearn for more than a paycheck from their jobs. Leaders who lead with love have extraordinary influence because they meet five unspoken employee needs:

Hear and understand me.

Even if you disagree with me, please don’t make me wrong.

Acknowledge the greatness within me.

Remember to look for my loving intentions.

Tell me the truth with compassion.76

EXHIBIT 5.9 The Practical Aspects and Outcomes of Caring About Others

What do you do when you care for someone?* What does it feel like to be cared about?*

1. reach out 2. embrace, hug 3. be there with them 4. compassion 5. acceptance 6. share dreams 7. acknowledge accomplishments 8. trust 9. encourage

10. be a cheerleader 11. tell you care 12. relate feelings 13. respect them 14. be positive 15. give them a smile 16. give them time 17. give them recognition 18. protect 19. reassure 20. celebrate with

1. valuable 2. alive 3. responsive 4. positive outlook 5. exhilarated 6. respect 7. free 8. important 9. good

10. safe 11. more open to express yourself 12. elevates self-esteem 13. boosts morale 14. proud 15. loved 16. worthy 17. blessed 18. you make a difference 19. fulfilled 20. happy

*These are the actual, unedited words called out by participants and written on a white board during a seminar at which people were asked these two questions. Source: Marilyn R. Zuckerman and Lewis J. Hatala, Incredibly American: Releasing the heart of Quality. © 1992. American Society for Quality. Reprinted with permission from the authors.

CHAPTER 5 LEADERSHIP MIND AND EMOTION 157

When leaders address these subtle emotional needs directly, people typically respond by loving their work and becoming emotionally engaged in solving prob- lems and serving customers. Enthusiasm for work and the organization increases. People want to believe that their leaders genuinely care. From the followers’ point of view, love versus fear has different motivational potential.

• Fear-based motivation: I need a job to pay for my basic needs (fulfilling lower needs of the body). You give me a job and I will give you just enough to keep my job.

• Love-based motivation: If the job and the leader make me feel valued as a person and provide a sense of meaning and contribution to the community at large (fulfill- ing higher needs of heart, mind, and body), then I will give you all I have to offer.77

Many examples throughout this book illustrate what happens when positive emotion is used. One management consultant went so far as to advise that finding creative ways to love could solve every imaginable leadership problem.78 Rational thinking and technical skills are important, but leading with love builds trust, sti- mulates creativity, inspires commitment, and unleashes boundless energy.

Leaders can develop their capacity for the positive emotions of love and caring. When Walt Bettinger, president and CEO of Charles Schwab, was in college, he learned a lesson he tries to apply every day. The professor handed each student a blank sheet of paper and gave them one final exam question: What’s the name of the lady who cleans this building? The students had spent four hours a night twice a week in the building for 10 weeks, encountering the cleaning lady several times a night as they went to get a soft drink or use the restroom. Bettinger says, “I didn’t know Dottie’s name—her name was Dottie—but I’ve tried to know every Dottie since.”79

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • Leaders use emotional as well as intellectual capabilities and understandings to

guide organizations through a turbulent environment and help people feel energized, motivated, and cared for in the face of rapid change, uncertainty, and job insecurity. People can learn to be whole leaders who lead with both the head and the heart.

• Leaders should be aware of how their mental models affect their thinking and may cause “blind spots” that limit understanding. Becoming aware of assump- tions is a first step toward shifting or expanding one’s mental model and being able to see the world in new and different ways. One challenge for today’s lea- ders is developing a global mindset.

• Four key issues important to expanding and developing a leader’s mind are independent thinking, open-mindedness, systems thinking, and personal mas- tery. Personal mastery involves clarity of mind, clarity of objectives, and an organized system for achieving objectives.

• Leaders should also understand the importance of emotions and emotional intelligence. Understanding emotions is imperative because emotions are conta- gious and emotions influence individuals’ performance.

Tw itt er

Fear-based motivation motivation based on fear of losing a job

Love-based motivation motivation based on feeling valued in the job

158 PART 3 THE PERSONAL SIDE OF LEADERSHIP

• Four basic components of emotional intelligence are self-awareness, self- management, social awareness, and relationship management. Emotionally intelligent leaders can have a positive impact on organizations by helping employees grow, learn, and develop; creating a sense of purpose and mean- ing; instilling unity and team spirit; and basing relationships on trust and respect, which allows employees to take risks and fully contribute to the organization.

• Traditional organizations have relied on fear as a motivator. Although fear does motivate people, it prevents people from feeling good about their work and often causes avoidance behavior. Fear can reduce trust and communication so that important problems and issues are hidden or suppressed. Leaders can choose to lead with love instead of fear. Love can be thought of as a motiva- tional force that enables people to feel alive, connected, and energized. People respond to love because it meets unspoken needs for respect and affirmation. Rational thinking is important to leadership, but it takes love to build trust, creativity, and enthusiasm.

DISCUSSION QUESTIONS 1. How do you feel about developing the emotional qualities of yourself and other people

in the organization as a way to be an effective leader? Discuss.

2. What does it mean to be a whole leader as described in the chapter? Can you give an example from your experience? Discuss.

3. Why is it so hard for people to change their assumptions? What are some specific rea- sons why leaders need to be aware of their mental models?

4. Discuss the similarities and differences between mental models and open-mindedness.

5. What is the concept of personal mastery? How important is it to a leader?

6. Which of the four elements of emotional intelligence do you consider most essential to an effective leader? Why?

7. Consider fear and love as potential motivators. Which is the best source of motivation for college students? For members of a new product development team? For top execu- tives at a media conglomerate? Why?

8. Have you ever experienced love and/or fear from leaders at work? How did you respond? Is it possible that leaders might carry love too far and create negative rather than positive results? Discuss.

9. Do you think it is appropriate for a leader to spend time developing people’s emotional intelligence? Why or why not?

10. Think about the class for which you are reading this text as a system. How might mak- ing changes without whole-systems thinking cause problems for students?

Complete this assignment online with CengageNOW.

C a C

LEADERSHIP AT WORK Mentors Think of a time when someone reached out to you as a mentor or coach. This might have been a time when you were having some difficulty and the person who reached out would have done so out of concern for you rather than for their own self-interest.

CHAPTER 5 LEADERSHIP MIND AND EMOTION 159

Below, briefly describe the situation, who the mentor was, and what the mentor did for you.

Mentoring comes from the heart, is a generous act, and is usually deeply appreciated by the recipient. How does it feel to recall the situation in which a mentor assisted you?

Share your experience with one or more students. What are the common characteristics that mentors possess based on your combined experiences?

In Class: A discussion of experiences with mentors is excellent for small groups. The instruc- tor can ask each group to identify the common characteristics that their mentors displayed and each group’s conclusions can be written on the board. From these lists of mentor char- acteristics, common themes associated with mentors can be defined. The instructor can ask the class the following questions: What are the key characteristics of mentors? Based on the key mentor characteristics, is effective mentoring based more on a person’s heart or mind? Will you (the student) reach out as a mentor to others in life, and how will you do it? What factors might prevent you from doing so?

Check out CengageNOW for additional cases with interactive activities.

C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS The New Boss Sam Nolan clicked the mouse for one more round of solitaire on the computer in his den. He’d been at it for more than an hour, and his wife had long ago given up trying to per- suade him to join her for a movie or a rare Saturday night on the town. The mind-numbing game seemed to be all that calmed Sam down enough to stop agonizing about work and how his job seemed to get worse every day.

Nolan was chief information officer at Century Medical, a large medical products com- pany based in Connecticut. He had joined the company four years ago, and since that time Century had made great progress integrating technology into its systems and processes. Nolan had already led projects to design and build two highly successful systems for Century. One was a benefits-administration system for the company’s human resources department. The other was a complex Web-based purchasing system that streamlined the process of pur- chasing supplies and capital goods. Although the system had been up and running for only a few months, modest projections were that it would save Century nearly $2 million annually. The new Web-based system dramatically cut the time needed for processing requests and plac- ing orders. Purchasing managers now had more time to work collaboratively with key stake- holders to identify and select the best suppliers and negotiate better deals.

Nolan thought wearily of all the hours he had put in developing trust with people throughout the company and showing them how technology could not only save time and

160 PART 3 THE PERSONAL SIDE OF LEADERSHIP

money but also support team-based work, encourage open information sharing, and give people more control over their own jobs. He smiled briefly as he recalled one long-term HR employee, 61-year-old Ethel Moore. She had been terrified when Nolan first began showing her the company’s intranet, but she was now one of his biggest supporters. In fact, it had been Ethel who had first approached him with an idea about a Web-based job posting sys- tem. The two had pulled together a team and developed an idea for linking Century man- agers, internal recruiters, and job applicants using artificial intelligence software on top of an integrated Web-based system. When Nolan had presented the idea to his boss, executive vice president Sandra Ivey, she had enthusiastically endorsed it. Within a few weeks the team had authorization to proceed with the project.

But everything began to change when Ivey resigned her position six months later to take a plum job in New York. Ivey’s successor, Tom Carr, seemed to have little interest in the project. During their first meeting, Carr had openly referred to the project as a waste of time and money. He immediately disapproved several new features suggested by the com- pany’s internal recruiters, even though the project team argued that the features could dou- ble internal hiring and save millions in training costs. “Just stick to the original plan and get it done. All this stuff needs to be handled on a personal basis anyway,” Carr countered. “You can’t learn more from a computer than you can talking to real people—and as for internal recruiting, it shouldn’t be so hard to talk to people if they’re already working right here in the company.” Carr seemed to have no understanding of how and why technology was being used. He became irritated when Ethel Moore referred to the system as “Web-based.” He boasted that he had never visited Century’s intranet site and suggested that “this Internet obsession” would blow over in a few years anyway. Even Ethel’s enthusi- asm couldn’t get through to him. “Technology is for those people in the IS department. My job is people, and yours should be, too,” Carr shouted. Near the end of the meeting, Carr even jokingly suggested that the project team should just buy a couple of good filing cabinets and save everyone some time and money.

Nolan sighed and leaned back in his chair. The whole project had begun to feel like a joke. The vibrant and innovative human resources department his team had imagined now seemed like nothing more than a pipe dream. But despite his frustration, a new thought entered Nolan’s mind: “Is Carr just stubborn and narrow-minded or does he have a point that HR is a people business that doesn’t need a high-tech job posting system?”

QUESTIONS

1. Describe the two different mental models represented in this story.

2. What are some of the assumptions that shape the mindset of Sam Nolan? Of Tom Carr?

3. Do you think it is possible for Carr to shift to a new mental model? If you were Sam Nolan, what would you do?

Sources: Based on Carol Hildebrand, “New Boss Blues,” CIO Enterprise, Section 2 (November 15, 1998), pp. 53–58; and Megan Santosus, “Advanced Micro Devices’ Web-Based Purchasing System,” CIO, Section 1 (May 15, 1998), p. 84. A version of this case originally appeared in Richard L. Daft, Organization Theory and Design, 7th ed. (Cincinnati, OH: South-Western, 2001), pp. 270–271.

The USS Florida The atmosphere in a Trident nuclear submarine is generally calm and quiet. Even pipe joints are cushioned to prevent noise that might tip off a pursuer. The Trident ranks among the world’s most dangerous weapons—swift, silent, and armed with 24 long-range missiles carrying 192 nuclear warheads. Trident crews are the cream of the Navy crop, and even the sailors who fix the plumbing exhibit a white-collar decorum. The culture aboard ship is a low-key, collegial one in which sailors learn to speak softly and share close quarters with an ever-changing roster of shipmates. Being subject to strict security restrictions enhances a sense of elitism and pride. To move up and take charge of a Trident submarine is an extraordinary

CHAPTER 5 LEADERSHIP MIND AND EMOTION 161

feat in the Navy—fewer than half the officers qualified for such commands ever get them. When Michael Alfonso took charge of the USS Florida, the crew welcomed his arrival. They knew he was one of them—a career Navy man who joined up as a teenager and moved up through the ranks. Past shipmates remembered him as basically a loner, who could be brusque but generally pleasant enough. Neighbors on shore found Alfonso to be an unfailingly polite man who kept mostly to himself.

The crew’s delight in their new captain was short-lived. Commander Alfonso moved swiftly to assume command, admonishing his sailors that he would push them hard. He wasn’t joking— soon after the Florida slipped into deep waters to begin a postoverhaul shakedown cruise, the new captain loudly and publicly reprimanded those whose performance he considered lacking. Chief Petty Officer Donald MacArthur, chief of the navigation division, was only one of those who suf- fered Alfonso’s anger personally. During training exercises, MacArthur was having trouble keep- ing the boat at periscope depth because of rough seas. Alfonso announced loudly, “You’re disqualified.” He then precipitously relieved him of his diving duty until he could be recertified by extra practice. Word of the incident spread quickly. Crew members, accustomed to the Navy’s adage of “praise in public, penalize in private,” were shocked. It didn’t take long for this type of behavior to have an impact on the crew, according to Petty Officer Aaron Carmody: “Peo- ple didn’t tell him when something was wrong. You’re not supposed to be afraid of your captain, to tell him stuff. But nobody wanted to.”

The captain’s outbursts weren’t always connected with job performance. He bawled out the supply officer, the executive officer, and the chief of the boat because the soda dispenser he used to pour himself a glass of Coke one day contained Mr. Pibb instead. He exploded when he arrived unexpectedly at a late-night meal and found the fork at his place setting missing. Soon, a newslet- ter titled The Underground was being circulated by the boat’s plumbers, who used sophomoric humor to spread the word about the captain’s outbursts over such petty matters. By the time the sub reached Hawaii for its “Tactical Readiness Evaluation,” an intense week-long series of inspec- tions by staff officers, the crew was almost completely alienated. Although the ship tested well, inspectors sent word to Rear Admiral Paul Sullivan that something seemed to be wrong on board, with severely strained relations between captain and crew. On the Trident’s last evening of patrol, much of the crew celebrated with a film night—they chose The Caine Mutiny and Crimson Tide, both movies about Navy skippers who face mutinies and are relieved of command at sea. When Humphrey Bogart, playing the captain of the fictional USS Caine, exploded over a missing quart of strawberries, someone shouted, “Hey, sound familiar?”

When they reached home port, the sailors slumped ashore. “Physically and mentally, we were just beat into the ground,” recalls one. Concerned about reports that the crew seemed “despondent,” Admiral Sullivan launched an informal inquiry that eventually led him to relieve Alfonso of his command. It was the first-ever firing of a Trident submarine com- mander. “He had the chance of a lifetime to experience the magic of command, and he squandered it,” Sullivan said. “Fear and intimidation lead to certain ruin.” Alfonso himself seemed dumbfounded by Admiral Sullivan’s actions, pointing out that the USS Florida under his command posted “the best-ever grades assigned for certifications and inspections for a postoverhaul Trident submarine.”

QUESTIONS

1. Analyze Alfonso’s impact on the crew in terms of love versus fear. What might account for the fact that he behaved so strongly as captain of the USS Florida?

2. Which do you think a leader should be more concerned about aboard a nuclear submarine— high certification grades or high-quality interpersonal relationships? Do you agree with Admiral Sullivan’s decision to fire Alfonso? Discuss.

3. Discuss Commander Alfonso’s level of emotional intelligence in terms of the four com- ponents listed in the chapter. What advice would you give him?

Source: Based on Thomas E. Ricks, “A Skipper’s Chance to Run a Trident Sub Hits Stormy Waters,” The Wall Street Journal (November 20, 1997), pp. A1, A6.

162 PART 3 THE PERSONAL SIDE OF LEADERSHIP

REFERENCES 1. Thomas E Ricks, “Charmed Forces: Army’s ‘Baby Generals’ Take a

Crash Course in Sensitivity Training,” The Wall Street Journal (January 19, 1998), p. A1.

2. Warren Bennis, quoted in Tricia Bisoux, “What Makes Great Leaders,” BizEd (September–October 2005), pp. 40–45.

3. Stacey Philpot, “Whole Leadership,” Leadership Excellence (July 2010), p. 6.

4. This basic idea is found in a number of sources, among them Jack Hawley, Reawakening the Spirit in Work (San Francisco: Berrett- Koehler, 1993); Aristotle, The Nicomachean Ethics, trans. by the Brothers of the English Dominican Province, rev. by Daniel J. Sullivan (Chicago: Encyclopedia Britannica, 1952); Alasdair MacIntyre, After Virtue: A Study in Moral Theory (Notre Dame, IN: University of Notre Dame Press, 1984); and Stephen Covey, The Seven Habits of Highly Effective People: Powerful Lessons in Personal Change (New York: Fireside Books/Simon & Schuster, 1990).

5. W. B. Rouse and N. M. Morris, “On Looking Into the Black Box: Prospects and Limits in the Search for Mental Models,” Psychological Bulletin 100 (1986), pp. 349–363; Beng-Chong Lim and Katherine J. Klein, “Team Mental Models and Team Performance: A Field Study of the Effects of Team Mental Model Similarity and Accuracy,” Journal of Organizational Behavior 27 (2006), pp. 403–418; Vanessa Urch Druskat and Anthony T. Pescosolido, “The Content of Effective Teamwork Mental Models in Self-Managing Teams: Ownership, Learning, and Heedful Interrelating,” Human Relations 55, no. 3 (2002), pp. 283–314; and Peter M. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization (New York: Double- day, 1990).

6. From Robert Townsend, Up the Organization, quoted in “Everything You Wanted to Know about Leadership, from the Man Who Broke All the Rules,” The Conference Board Review (September–October 2007), pp. 37–41.

7. Adam Lashinsky, “Chaos by Design,” Fortune (October 2, 2006), pp. 86–98.

8. The following discussion is based partly on Robert C. Benfari, Understanding and Changing Your Management Style (San Francisco: Jossey-Bass, 1999), pp. 66–93.

9. Stephanie Clifford, “Chief’s Silicon Valley Stardom Quickly Clashed at J.C. Penney,” The New York Times (April 9, 2013), http://www .nytimes.com/2013/04/10/business/how-an-apple-star-lost-his-luster -at-penneys.html?emc=eta1&_r=0 (accessed April 24, 2013); Stephanie Clifford, “J.C. Penney Ousts Chief of 17 Months,” The New York Times, April 8, 2013, http://www.nytimes.com/2013/04 /09/business/ron-johnson-out-as-jc-penney-chief.html?pagewanted =all&_r=0 (accessed April 24, 2013); and Andrew Ross Sorkin, “A Dose of Realism for the Chief of J.C. Penney,” The New York Times, November 12, 2011, http://dealbook.nytimes.com/2012/11/12/a -dose-of-realism-for-the-chief-of-j-c-penney/ (accessed March 26, 2013).

10. Anthony J. Mayo and Nitin Nohria, In Their Time: The Greatest Business Leaders of the 20th Century (Boston: Harvard Business School Press, 2005).

11. Prasad Kajpa, “Steve Jobs and the Art of Mental Model Innovation,” Ivey Business Journal (May–June 2012), http://www.iveybusiness journal.com/topics/leadership/steve-jobs-and-the-art-of-mental -model-innovation (accessed March 26, 2013); David J. Glew, Stephen C. Harper, and Jonathan D. Rowe, “Is Your Organization a Target?” Industrial Management (November–December 2010), pp. 15–20; Geoffrey Colvin, “The Most Valuable Quality in a Manager,”

Fortune (December 29, 1997), pp. 279–280; and Marlene Piturro, “Mindshift,” Management Review (May 1999), pp. 46–51.

12. Kajpa, “Steve Jobs and the Art of Mental Model Innovation.”

13. Glew et al., “Is Your Organization a Target?”; Gary Hamel, “Why … It’s Better to Question Answers Than to Answer Questions,” Across the Board (November–December 2000), pp. 42–46; and Jane C. Linder and Susan Cantrell, “It’s All in the Mind (set),” Across the Board (May–June 2002), pp. 39–42.

14. This section is based on Schon Beechler and Dennis Baltzley, “Creating a Global Mindset,” Chief Learning Officer (May 29, 2008), http://clomedia.com/articles/view/creating_a_global_mindset/1 (accessed June 26, 2012); Mansour Javidan and Jennie L. Walker, “A Whole New Global Mindset for Leadership,” People & Strategy 35, no. 2 (2012), pp. 36–41; and Stephen L. Cohen, “Effective Global Leadership Requires a Global Mindset,” Industrial and Commercial Training 42, no. 1 (2010), pp. 3–10.

15. Definition based on Mansour Javidan and Mary B. Teagarden, “Conceptualizing and Measuring Global Mindset,” Advances in Global Leadership 6 (2011), pp. 13–39; and Beechler and Baltzley, “Creating a Global Mindset.”

16. Ken Powell, interviewed by Beth Kowitt, “Move Beyond Your Comfort Zone,” Fortune (May 4, 2009), p. 48.

17. Based in part on Lauren A. E. Schuker, “Plot Change: Foreign Forces Transform Hollywood Films,” The Wall Street Journal (July 31, 2010), p. A1; and Nicole Allan, “How to Make a Hollywood Hit,” The Atlantic (May 2012), pp. 70–71.

18. Quoted in Schuker, “Plot Change.”

19. Anil K. Gupta and Vijay Govindarajan, “Cultivating a Global Mindset,” Academy of Management Executive 16, no. 1 (2002), pp. 116–126.

20. Hamel, “Why … It’s Better to Question Answers Than to Answer Questions”; Geoffrey Colvin, “Managing in Chaos,” Fortune (October 2, 2006), pp. 76–82.

21. Example cited in Janet Rae-Dupree, “Innovative Minds Don’t Think Alike,” The New York Times (December 30, 2007), http://www .nytimes.com/2007/12/30/business/30know.html?pagewanted =all&_r=0 (accessed December 30, 2007).

22. Daniel Levinthal and Claus Rerup, “Crossing an Apparent Chasm: Bridging Mindful and Less-Mindful Perspectives on Organizational Learning,” Organization Science 17, no. 4 (August 2006), pp. 502–513; and Ellen Langer and John Sviokla, “An Evaluation of Charisma from the Mindfulness Perspective,” unpublished manu- script, Harvard University. Part of this discussion is also drawn from Richard L. Daft and Robert H. Lengel, Fusion Leadership: Unlocking the Subtle Forces That Change People and Organizations (San Francisco: Berrett-Koehler, 1998).

23. Based on Michael Chaskalson, The Mindful Workplace (Chichester, West Sussex: Wiley-Blackwell, 2011); Ellen J. Langer, “Minding Matters: The Consequences of Mindlessness-Mindfulness,” in Advances in Experimental Social Psychology, vol. 22, L. Berkowitz, ed. (San Diego: Academic Press, 1989), pp. 137–173; and Levinthal and Rerup, “Crossing an Apparent Chasm.”

24. Bauback Yeganeh, “Mindful Leader,” Leadership Excellence (March 2012), p. 7.

25. Matt Richtel, “Hooked on Gadgets, and Paying a Mental Price,” The New York Times (June 6, 2010), http://www.nytimes.com/2010/06 /07/technology/07brain.html?pagewanted=all&_r=0 (accessed June 7, 2010).

CHAPTER 5 LEADERSHIP MIND AND EMOTION 163

26. T. K. Das, “Educating Tomorrow’s Managers: The Role of Critical Thinking,” The International Journal of Organizational Analysis 2, no. 4 (October 1994), pp. 333–360.

27. Russell Gold and Neil King Jr. “The Gulf Oil Spill: Red Flags Were Ignored Aboard Doomed Rig,” The Wall Street Journal (May 13, 2010), p. A6.

28. Bernard M. Bass, Leadership and Performance Beyond Expectations (New York: The Free Press, 1985); and B. M. Bass, New Paradigm Leadership: An Inquiry into Transformational Leadership (Alexandria, VA: U.S. Army Research Institute for the Behavioral and Social Sciences, 1996).

29. The Pike Syndrome has been discussed in multiple sources.

30. Janet Rae-Dupree, “Innovative Minds Don’t Think Alike” (December 30, 2007), p. 3.3.

31. Jerome Groopman, “Mental Malpractice: (Op-Ed column),” The New York Times (July 7, 2007), p. A13.

32. Chris Argyris, Flawed Advice and the Management Trap (New York: Oxford University Press, 2000); and Eileen C. Shapiro, “Managing in the Cappuccino Economy” (review of Flawed Advice), Harvard Business Review (March–April 2000), pp. 177–183.

33. This section is based on Peter M. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization (New York: Doubleday, 1990); John D. Sterman, “Systems Dynamics Modeling: Tools for Learning in a Complex World,” California Management Review 43, no. 4 (Summer, 2001), pp. 8–25; Andrea Gabor, “Seeing Your Company as a System,” Strategy Business (Summer 2010), http:// www.strategy-business.com/article/10210?gko=20cca (accessed June 20, 2012); and Ron Zemke, “Systems Thinking,” Training (February 2001), pp. 40–46.

34. This example is cited in Sterman, “Systems Dynamics Modeling.”

35. Peter M. Senge, Charlotte Roberts, Richard B. Ross, Bryan J. Smith, and Art Kleiner, The Fifth Discipline Fieldbook (New York: Currency/Doubleday, 1994), p. 87.

36. Peter Senge, The Fifth Discipline; and David Allen, Getting Things Done: The Art of Stress-Free Productivity (New York: Viking Penguin, 2001).

37. Timothy A. Judge, Amy E. Colbert, and Remus Ilies, “Intelligence and Leadership: A Quantitative Review and Test of Theoretical Proposi- tions,” Journal of Applied Psychology (June 2004), pp. 542–552.

38. Sigal G. Barsade and Donald E. Gibson, “Why Does Affect Matter in Organizations?” Academy of Management Perspectives 21, no. 1 (February 2007), pp. 36–59; Daniel Goleman, Emotional Intelligence: Why It Can Matter More Than IQ (New York: Bantam Books, 1995); John D. Mayer and David Caruso, “The Effective Leader: Under- standing and Applying Emotional Intelligence,” Ivey Business Journal (November–December 2002); Pamela Kruger, “A Leader’s Journey,” Fast Company (June 1999), pp. 116–129; and Hendrie Weisinger, Emotional Intelligence at Work (San Francisco: Jossey-Bass, 1998).

39. Study by Daniel Goleman, co-chairman of the Consortium for Research on Emotional Intelligence in Organizations, reported in Diann Daniel, “Soft Skills for CIOs and Aspiring CIOs: Four Ways to Boost Your Emotional Intelligence,” CIO (June 25, 2007), http:// www.cio.com (accessed October 18, 2007).

40. Based on Goleman, Emotional Intelligence; Goleman, “Leadership That Gets Results,” Harvard Business Review (March–April 2000), pp. 79–90; J. D. Mayer, D. R. Caruso, and P. Salovey, “Emotional Intelligence Meets Traditional Standards for an Intelligence,” Intelligence 27, no. 4 (1999), pp. 266–298; Neal M. Ashkanasy and Catherine S. Daus, “Emotion in the Workplace: The New Challenge for Managers,” Academy of Management Executive 16, no.1 (2002), pp. 76–86; and Weisinger, Emotional Intelligence at Work.

41. Studies reported in Stephen Xavier, “Are You at the Top of Your Game? Checklist for Effective Leaders,” Journal of Business Strategy

26, no. 3 (2005), pp. 35–42; and Joyce E. Bono and Remus Ilies, “Charisma, Positive Emotions, and Mood Contagion,” The Leader- ship Quarterly 17 (2006), pp. 317–334.

42. This section is based in part on Goleman, Emotional Intelligence: Why It Can Matter More Than IQ, pp. 289–290.

43. Rensselaer Polytechnic Institute, Lally School of Management and Technology, as reported in BusinessWeek Frontier (February 5, 2001), p. F4.

44. This discussion is based on V. Vijayalakshmi and Sanghamitra Bhattacharyya, “Emotional Contagion and Its Relevance to Indivi- dual Behavior and Organizational Processes: A Position Paper,” Journal of Business Psychology 27 (2012), pp. 363–374; E. Hatfield, J. T. Cacioppo, and R. L. Rapson, Emotional Contagion (New York: Cambridge University Press, 1994); Barsade and Gibson, “Why Does Affect Matter in Organizations?”; and Bono and Ilies, “Charisma, Positive Emotions, and Mood Contagion.”

45. Jeff Bailey, “Outsize Personality Tries to Create a Regional Airline to Match,” The New York Times (January 19, 2007), p. C1.

46. Research by Noah Eisenkraft and Hillary Anger Elfenbein reported in Nicole Branan, “The ‘Me’ Effect,” Scientific American Mind (November–December 2010), pp. 14–15; Noah Eisenkraft and Hillary Anger Elfenbein, “The Way You Make Me Feel,” Psycholo- gical Science 21 (April 2010), pp. 505–510; Robert I. Sutton, “How Bad Apples Infect the Tree,” The New York Times (November 28, 2010), p. BU.8; and Roy Baumeister et al., “Bad Is Stronger Than Good,” Review of General Psychology 5, no. 4 (2001), pp. 323–370.

47. Daniel Goleman, Richard Boyatzis, and Annie McKee, “The Emotional Reality of Teams,” Journal of Organizational Excellence (Spring 2002), pp. 55–65.

48. P. J. Jordan, N. M. Ashkanasy, C. E. J. Härtel, and G. S. Hooper, “Workgroup Emotional Intelligence: Scale Development and Relationship to Team Process Effectiveness and Goal Focus,” Human Resource Management Review 12, no. 2 (Summer 2002), pp. 195–214.

49. See studies reported in Barsade and Gibson, “Why Does Affect Matter in Organizations?”; Bono and Ilies, “Charisma, Positive Emotions, and Mood Contagion; and “Why Mood Matters,” Management Today (November 1, 2008), p. 46.

50. Barbara L. Fredrickson, “What Good Are Positive Emotions?” Review of General Psychology 2, no. 3 (1998), pp. 300–319; Barsade and Gibson, “Why Does Affect Matter”; and “Why Mood Matters.”

51. Jerry Krueger and Emily Killham, “At Work, Feeling Good Matters,” Gallup Management Journal (December 8, 2005).

52. “Why Mood Matters.”

53. Diane Coutu, “Leadership Lessons from Abraham Lincoln,” Harvard Business Review (April 2009), pp. 43–47.

54. Daniel Goleman, “Emotional Mastery: Seek to Excel in Four Dimensions,” Leadership Excellence (June 2011), pp. 12–13; and Goleman, “Leadership that Gets Results.”

55. Dave Marcum, Steve Smith, and Mahan Khalsa, “The Marshmallow Conundrum,” Across the Board (March–April 2004), pp. 26–30.

56. Sue Shellenbarger, “Health & Fitness: How to Keep Your Cool in Angry Times,” The Wall Street Journal Asia (September 27, 2010), p. 11.

57. Alan Farnham, “Are You Smart Enough to Keep Your Job?” Fortune (January 15, 1996), pp. 34–47.

58. Peter J. Frost, “Handling the Hurt: A Critical Skill for Leaders,” Ivey Management Journal (January–February 2004).

59. Rolf W. Habbel, “The Human[e] Factor: Nurturing a Leadership Culture,” Strategy & Business 26 (First Quarter 2002), pp. 83–89; and Melvin Smith and Diana Bilimoria, “Heart of Leadership: Engage with Emotional Intelligence,” Leadership Excellence (March 2012), p. 5.

164 PART 3 THE PERSONAL SIDE OF LEADERSHIP

60. Jeremy W. Peters, “Time Inc. Chief Executive Jack Griffin Out,” The New York Times (February 17, 2011), http://mediadecoder .blogs.nytimes.com/2011/02/17/time-inc-chief-executive-jack-griffin -out/ (accessed April 1, 2013).

61. Research study results reported in Goleman, “Leadership That Gets Results.”

62. Dov Seidman, “The New Way to Win Super Bowls: Leadership Lessons of the NFL’s Cutting Edge Coaches,” Time (February 1, 2013), http://business.time.com/2013/02/01/the-new-way-to-win - s u p e r - b o w l s - l e a d e r s h i p - l e s s o n s - o f - t h e - n f l s - c u t t i n g - e d g e -coaches/ (accessed April 1, 2013).

63. Barsade and Gibson, “Why Does Affect Matter in Organizations?”; Frank Walter, Michael S. Cole, and Ronald H. Humphrey, “Emo- tional Intelligence: Sine Qua Non of Leadership or Folderol?” Academy of Management Perspectives (February 2011), pp. 45–58; and Kenneth M. Nowack, “Emotional Intelligence: Defining and Understanding the Fad,” T D (August 2012), pp. 60–63.

64. Xavier, “Are You at the Top of Your Game?”

65. This discussion is based in part on Kathleen D. Ryan and Daniel K. Oestreich, Driving Fear out of the Workplace: How to Overcome the Invisible Barriers to Quality, Productivity, and Innovation (San Francisco: Jossey-Bass, 1991); and Scott A. Snook, “Love and Fear and the Modern Boss,” Harvard Business Review (January 2008), pp. 16–17.

66. S. Lyubomirsky, L. King, and E. Diener, “The Benefits of Frequent Positive Affect: Does Happiness Lead to Success?” Psychological Bulletin 131, no. 6 (2005), pp. 803–855; R. Cropanzano and T. A. Wright, “When a ‘Happy’ Worker Is Really a ‘Productive’ Worker: A Review and Further Refinement of the Happy-Productive Worker Theory,” Consulting Psychology Journal: Practice and Research 53, no. 3 (2001), pp. 182–199; and Barsade and Gibson, “Why Does Affect Matter in Organizations?”

67. David E. Dorsey, “Escape from the Red Zone,” Fast Company (April/ May 1997), pp. 116–127.

68. Susan G. Hauser, “The Degeneration of Decorum,” Workforce Management (January 11, 2011), pp. 16–18, 20–21.

69. Tom Kelley and David Kelley, “Reclaim Your Creative Confidence,” Harvard Business Review (December 2012), pp. 115–117; and Frederic Lardinois, “Pulse News Reader Dips Its Toes into Social with New ‘Highlights’ Feature,” TechCrunch (February 12, 2013), http://techcrunch.com/2013/02/12/pulse-news-reader-dips-its -toes-into-social/ (accessed April 1, 2013).

70. Frederic Lardinois, “Pulse News Reader Dips Its Toes into Social with New ‘Highlights’ Feature,” TechCrunch (February 12, 2013), http:// tech cr u n ch . co m/2 0 1 3 /0 2 /1 2 / p u ls e-n ews -r ea d er -d i p s -its -to es -into-social/ (accessed April 1, 2013).

71. This section is based on Ryan and Oestreich, Driving Fear out of the Workplace; and Therese R. Welter, “Reducing Employee Fear: Get Workers and Managers to Speak Their Minds,” Small Business Report (April 1991), pp. 15–18.

72. Ryan and Oestreich, Driving Fear out of the Workplace, p. 43.

73. Daniel Holden, “Team Development: A Search for Elegance,” Industrial Management (September–October 2007), pp. 20–25.

74. Covey, The Seven Habits of Highly Effective People, p. 80.

75. Donald G. Zauderer, “Integrity: An Essential Executive Quality,” Business Forum (Fall 1992), pp. 12–16.

76. Hyler Bracey, Jack Rosenblum, Aubrey Sanford, and Roy Trueblood, Managing from the Heart (New York: Dell Publishing, 1993), p. 192.

77. Madan Birla with Cecilia Miller Marshall, Balanced Life and Leadership Excellence (Memphis, TN: The Balance Group, 1997), pp. 76–77.

78. Rodney Ferris, “How Organizational Love Can Improve Leader- ship,” Organizational Dynamics 16, no. 4 (Spring 1988), pp. 40–52.

79. Kristy J. O’Hara, “Role Player,” Smart Business Akron/Canton (March 2009), p. 14.

CHAPTER 5 LEADERSHIP MIND AND EMOTION 165

Chapter 6: Courage and Moral Leadership

Jo rd an

Ly e/ Fl ic kr O pe n/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Combine a rational approach to leadership with a concern for people and ethics. • Understand how leaders set the ethical tone in organizations and recognize the distinction between

ethical and unethical leadership.

• Recognize your own stage of moral development and ways to accelerate your moral maturation. • Know and use mechanisms that enhance an ethical organizational culture. • Apply the principles of stewardship and servant leadership. • Recognize courage in others and unlock your own potential to live and act courageously.

CHAPTER OUTLINE 168 Moral Leadership

Today

172 Acting Like a Moral Leader

173 Becoming a Moral Leader

175 Servant Leadership

179 Leading with Courage

In the Lead

169 Denise Ramos and Jennifer Schiavone, ITT

178 Adam Grant, Wharton School of the University of Pennsylvania

181 Paula Reid, U.S Secret Service

184 Michael Woodford, Olympus

Leader’s Self-Insight

171 Ethical Maturity

179 Your Servant Leadership Orientation

183 Assess Your Moral Courage

Leader’s Bookshelf

186 Courage Goes to Work: How to Build Backbones, Boost Performance, and Get Results

Leadership at Work

188 Scary Person

Leadership Development: Cases for Analysis

189 What Should I Say?

190 The Boy, the Girl, the Ferryboat Captain, and the Hermits

B y the time she was shot in the head in an assassination attempt by Taliban gunmen in October 2012, 14-year-old Malala Yousafzai had been a leader in the fight for girls’ education in Pakistan for more than three years. Yousafzai

began writing a blog under a pseudonym for the BBC at the age of 11, detailing her life under Taliban rule, their control of the Swat Valley, and her advocacy of education for girls. After the Pakistan military ousted the militants from her region, Yousafzai began speaking publicly. A New York Times documentary and interviews by both print and television media raised her profile further and put her in the direct aim of the Taliban. After life-saving surgeries in Pakistan following the shooting, Yousafzai was flown to Birmingham, England, where she underwent numerous more surgeries—and where, within six months, she returned to school. The Taliban has vowed that they will keep trying to kill Yousafzai, but the young leader remains committed. According to one of the doctors who treated her, “She’s not naïve at all about what happened to her and the situation in terms of her high profile. She’s incredibly determined to continue to speak for her cause.”1

Malala Yousafzai knew very early in life that being an influential leader means learning who you are and what you stand for, and then having the courage to act. Leaders demonstrate confidence and commitment in what they believe and what they do. A deep devotion to a cause or a purpose larger than one’s self sparks the courage to act, as it does for Malala Yousafzai, who said upon her return to school, “I want all girls in the world to have this basic opportunity.”2

167 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

In addition, Malala Yousafzai’s story illustrates that real leadership has less to do with making use of other people than with serving other people. Placing others ahead of oneself is a key to successful leadership, whether in social activism, politics, war, education, sports, social services, or business.

This chapter explores ideas related to courage and moral leadership. In the previous chapter, we discussed mind and emotion, two of the three elements that come together for successful leadership. This chapter focuses on the third element, spirit—on the ability to look within, to contemplate the human condition, to think about what is right and wrong, to see what really matters in the world, and to have the courage to stand up for what is worthy and right. We begin by looking at the situation in which most organizations currently operate, the dilemma leaders face in the modern world, and the importance of leaders setting an ethical tone within the organization. Next we explore how leaders can act in a moral way, examine a model of personal moral development, and look at the importance of stewardship and servant leadership. The final sections of the chapter explore what courage means and how leaders develop the courage for moral leadership to flourish.

MORAL LEADERSHIP TODAY The names of once-revered corporations such as AIG, Lehman Brothers, Bear Stearns, and Countrywide have become synonymous with greed, deceit, arrogance, or lack of moral conscience. Although the high-profile stories of ethical misconduct in organizations have slowed a bit, there are plenty of leaders still on the hot seat because of immoral or unethical behavior: Brian Dunn of Best Buy and Mark Hurd of Hewlett-Packard both resigned under pressure due to inappropriate relationships with female employees. Scott Thompson resigned as CEO of Yahoo after only four months on the job because reports revealed he had inaccurately claimed on his resume that he had a degree in computer science.3 And at the nonprofit Wyckoff Heights Medical Center in one of the poorest neighborhoods in Brooklyn, an inves- tigation revealed a pattern of insider dealing that lavishly benefitted top managers, board members, and local politicians while damaging the organization to the point that it might be closed, further limiting health care options for the poor.4

The Ethical Climate in Business Leaders face many pressures that challenge their ability to do the right thing. The most dangerous obstacles for leaders are personal weakness and self-interest rather than full-scale corruption.5 Pressures to cut costs, increase profits, meet the demands of vendors or business partners, and look successful can all contribute to ethical lapses. For example, during the recent housing and financial crisis, leaders at Standard & Poor’s, the ratings agency, ignored ethical danger signals and chose to put short-term interests ahead of the truth in order to produce the ratings that were desired by banks putting together mortgage deals. A civil suit filed by the U.S. Justice Department alleges that S&P leaders knowingly issued unwarranted high ratings to maintain business.6 Their actions and those of leaders in many other companies con- tributed to the collapse of the housing market and a worldwide financial crisis.

Another challenge in today’s environment is an overemphasis on pleasing shareholders, which may cause some managers to behave unethically toward customers, employees, and the broader society.7 Managers are under enormous pressure to meet short-term earnings goals, and some even use accounting gimmicks

NEW LEADER ACTION MEMO As a leader, you can put ethical values into action and set the example you want followers to live by. You can resist pressures to act unethically just to avoid criticism or achieve short-term gains.

168 PART 3 THE PERSONAL SIDE OF LEADERSHIP

or other techniques to show returns that meet market expectations rather than ones that reflect true performance.8 All leaders want their organizations to appear successful, and they can sometimes do the wrong thing just so they will look good to others. The question for leaders is whether they can summon the fortitude to do the right thing despite outside pressures. “Life is lived on a slippery slope,” says Harvard Business School’s Richard Tedlow. “It takes a person of character to know what lines you don’t cross.”9

Leaders Set the Ethical Tone Top leaders in particular are facing closer scrutiny because what goes on at the top sets the standard for the rest of the organization. In a study of Fortune 100 compa- nies, fully 40 percent were found to have been engaged in activities that could be considered unethical.10 Moreover, researchers concluded that the misdeeds in many cases could be traced to the failure of top executives to enforce and live up to high ethical standards.

Leaders carry a tremendous responsibility for setting the ethical climate and acting as positive role models for others.11 Leaders signal what matters through their behavior, and when leaders operate from principles of selfishness and greed, many employees come to see that type of behavior as okay. At the now-defunct Bear Stearns, for example, senior executives were openly arrogant and ambitious for personal successes, and they built a “sharp-elbowed, opportunistic culture” in which rules and basic standards of fairness, honesty, and honor could be bent for the sake of achieving personal gain.12 Contrast the Bear Stearns approach to the culture Denise Ramos is building at ITT.

IN THE LEAD Denise Ramos and Jennifer Schiavone, ITT ITT, a diversified global industrial corporation, was founded in the early twentieth century, but when the corporation spun off its defense and water businesses in October 2011, it essentially became a “100-year-old startup,” as chief communications officer Jennifer Schiavone puts it. Many companies would start building the brand by taking an external approach, but Schiavone’s- team and new CEO Denise Ramos took the opposite approach—building the company’s reputa- tion from the inside out with a culture of trust, engagement, and integrity.

Ramos went on a global listening tour, meeting with employees at all levels, some- times individually or in small teams, other times in large town-hall-style gatherings. The result of all this listening was the “ITT Way,” a code that encapsulates the core values of respect, responsibility, and integrity and defines how the company uses them to meet the needs of employees, customers, business partners, shareholders, and the communities where ITT operates.

Putting values on paper is easy. Acting on them is what counts. Ramos works hard to see that managers at all levels “walk the talk.” She tells a story about the manager at one unit in Latin America who faced a difficult choice: he could pay a bribe and make a sale that would enable him to meet his financial goals for the quarter, or he could refuse to pay, lose the sale, and miss his targets. He chose the latter option, and top executives went out of their way to congratulate him on missing his numbers for the quarter. Achieving sales and earnings targets is good, says Ramos, but when people do the right thing, “that’s the time to celebrate.” 13

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 169

Denise Ramos is building a culture of integrity and ethical leadership at ITT by modeling ethical values and rewarding other managers for doing the same. Exhibit 6.1 compares ethical and unethical leadership. The behaviors listed in column 1 contribute to an organizational climate of trust, fairness, and doing the right thing, such as the one Denise Ramos is building at ITT. Column 2 lists the opposite behaviors, which contrib- ute to a climate ripe for ethical and legal abuses, such as at Bear Stearns.14

Ethical leaders aren’t preoccupied with their own importance. They keep the focus on employees, customers, and the greater good rather than taking every opportunity to satisfy their self-interest, feed their greed, or nourish their egos. Unethical leaders typically pay more attention to gaining benefits for themselves rather than for the company or the larger society. For example, an investigation of New York State’s pension fund for public workers found that former New York Comptroller Alan Hevesi and other political leaders and advisors accepted millions in sham consulting fees, travel expenses, campaign contributions, and other favors in exchange for giving specified investment firms parts of the fund to manage, enabling the firms to earn hefty management fees. Hevesi and advisor Hank Morris both pleaded guilty to felony corruption charges. Hevesi was paroled in February 2013 after serving 20 months in prison.15

Also shown in Exhibit 6.1, ethical leaders are honest with employees, partners, customers, vendors, and shareholders. They strive for fairness and take care to honor their agreements or commitments to others. Unethical leaders, on the other hand, often practice deception. In a USA Today survey some years ago, 82 percent of CEOs said they lied about their golf scores. Sure, it’s a small thing, but little by little, dishonesty can become a way of life and business.16

Ethical leaders tend to share the credit for successes and accept the blame when things go wrong, whereas unethical leaders often take credit for followers’ accom- plishments and diminish the dignity of others by treating people with discourtesy and disrespect. Ethical leaders help followers develop their potential and have a role in decision making, whereas unethical leaders often see followers as a means to an end.

Finally, one of the primary ways leaders contribute to an ethical organization is by speaking up against acts they believe are wrong. If a leader knows someone is being treated unfairly by a colleague and does nothing, the leader is setting a

NEW LEADER ACTION MEMO Go to Leader’s Self-Insight 6.1 and complete the questions to learn whether your behavior and decisions suggest that you will be an ethical leader.

EXHIBIT 6.1 Comparing Ethical versus Unethical Leadership

The Ethical Leader The Unethical Leader

Possesses humility Is arrogant and self-serving Maintains concern for the greater good Excessively promotes self-interest Is honest and straightforward Practices deception Fulfills commitments Breaches agreements Strives for fairness Deals unfairly Takes responsibility Shifts blame to others Shows respect for each individual Diminishes others’ dignity Encourages and develops others Neglects follower development Serves others Withholds help and support Shows courage to stand up for what is right Lacks courage to confront unjust acts

Source: Based on Donald G. Zauderer, “Integrity: An Essential Executive Quality,” Business Forum (Fall 1992), pp. 12–16.

170 PART 3 THE PERSONAL SIDE OF LEADERSHIP

precedent for others to behave unfairly as well. Peers and subordinates with lax ethical standards feel free to act as they choose. Consider what happened at Pennsylvania State University. In 2001, Mike McQueary, at the time a graduate assistant in the football program, reported to the head football coach Joe Paterno that he saw defensive coordi- nator Jerry Sandusky possibly sexually abusing a young boy in the locker room. Athletic director Tim Curley and at least two top administrators also soon learned of the inci- dent. But no one took the next step to stop the immoral (and illegal) behavior, and Sandusky went on to molest more boys before one of his victims brought the abuse to light. More than 10 years after McQueary’s initial report, Sandusky was convicted on 45 counts of child sexual abuse. The courts and the public were astonished to learn how many people apparently knew about Sandusky’s behavior and did nothing beyond talking with Sandusky and urging him to get professional help.17

How can leaders turn a blind eye to such behavior? The fact is that most man- agers have a natural inclination to protect the organization. In addition, leaders have to fight against a tendency for people “to see what we want to see, not see what we don’t want to see, and to hope a problem will go away on its own,” a tendency that causes leaders such as those at Penn State to make decisions “that later come to be seen by others as ethically indefensible.”18 Penn State leaders aren’t alone in this

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 6.1

Ethical Maturity

Instructions: Think about how you typically behave and make decisions and respond honestly to the statements below. Answer as you actually behave, not as you would want to behave.

Mostly False

Mostly True

1. I can clearly state the principles and values that guide my actions.

2. I promptly own up to my own mistakes and failures.

3. I am able to quickly “forgive and forget” when someone has made a serious mistake that affects me.

4. When making a difficult decision, I take the time to assess my principles and values.

5. I have a reputation among my friends and co-workers for keeping my word.

6. I intentionally reflect on my mistakes to improve my performance.

7. When someone asks me to keep a confidence, I always do so completely.

8. When things go wrong, I seldom blame others or circumstances.

9. I am able to forgive myself soon after a serious mistake.

10. My coworkers would say that my behavior is very consistent with my values.

Scoring and Interpretation Give yourself 1 point for each Mostly True answer you checked above. Total Score . Your score for the ethical maturity scale suggests whether you are on track to become an ethical leader as described in Exhibit 6.1. A high score of 8Ģ10 is suggestive of someone who is more concerned with values and other people than with self-interest. A score of 0Ģ3 would be considered low, and a score of 4Ģ7 is the middle ground. Your score also pro- vides a clue about your level of moral development shown in Exhibit 6.4. The postconventional level of development means that you consider principles and values, take per- sonal responsibility, and do not blame others. A high score suggests that you have a highly developed moral sense. A lower score suggests you may be at the conven- tional or even pre-conventional level. Reflect on what your score means to you.

Source: Based on and adapted from Doug Lennick and Fred Kiel, Moral Intelligence: Enhancing Business Performance and Leadership Success (Upper Saddle River, NJ: Cordon School Publications, 2005), pp. 251–263.

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171 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

tendency to protect the organization even at the risk of allowing unethical or illegal behavior to continue. For many reasons, it is often hard to stand up for what is right, but this is a primary way in which leaders create an environment of integrity.

ACTING LIKE A MORAL LEADER At Penn State, numerous leaders were guilty of putting winning football games and protecting the school’s reputation ahead of morality. At other organizations, leaders may put meeting economic goals ahead of doing the right thing. Companies that get into ethical trouble typically have top leaders who make quarterly earnings and the share price their primary purpose of business and the most important measure of individual and organizational success.19 When leaders forget that business is about values and not just economic performance, organizations and the broader society are hurt in the process.

Moral leadership doesn’t mean ignoring profit and loss, share price, production costs, and other hard, measurable facts, but it does require recognizing and adhering to ethical values and acknowledging the importance of human meaning, quality, and higher purpose.20 Henry Ford’s century-old comment seems tailor-made for today’s poor ethical climate: “For a long time people believed that the only purpose of industry was to make a profit. They are wrong. Its purpose is to serve the general welfare.”21

Despite the corporate realities of greed, competition, and the drive to achieve goals and profits, leaders can act based on moral values and encourage others to develop and use moral values and adhere to ethical standards of conduct in the workplace. The single most important factor in ethical decision making in organizations is whether leaders show a commitment to ethics in their talk and especially their behavior.22 Employees learn about the values that are important in the organization by watching leaders.

Exhibit 6.2 lists some specific ways leaders act to build an environment that allows and encourages people to behave ethically. Leaders create organizational sys- tems and policies that support ethical behavior, such as creating open-door policies that encourage people to talk about anything without fear, establishing clear ethics codes, rewarding ethical conduct, and showing zero tolerance for violations. Many companies have hired high-level chief compliance officers to police managers and

NEW LEADER ACTION MEMO As a leader, you can drive fear out of the organization so that followers feel comfortable re- porting problems or ethical abuses. You can establish clear ethics policies, reward ethical conduct, and show zero toler- ance for violations.

EXHIBIT 6.2 How to Act Like a Moral Leader

1. Articulate and uphold high moral principles.

2. Focus on what is right for the organization as well as all the people involved.

3. Set the example you want others to live by.

4. Be honest with yourself and others.

5. Drive out fear and eliminate undiscussables.

6. Establish and communicate ethics policies.

7. Develop a backbone—show zero tolerance for ethical violations.

8. Reward ethical conduct.

9. Treat everyone with fairness, dignity, and respect, from the lowest to the highest level of the organization.

10. Do the right thing in both your private and professional life—even if no one is looking.

Sources: Based on Linda Klebe Treviño, Laura Pincus Hartman, and Michael Brown, “Moral Person and Moral Manager: How Executives Develop a Reputation for Ethical Leadership,” California Management Review 42, no. 4 (Summer 2000), pp. 128–142; Christopher Hoenig, “Brave Hearts,” CIO (November 1, 2000), pp. 72–74; and Patricia Wallington, “Honestly?!” CIO (March 15, 2003), pp. 41–42.

172 PART 3 THE PERSONAL SIDE OF LEADERSHIP

employees.23 Most companies have established codes of ethics to guide employee behavior or lists of core values that employees are expected to honor. Exhibit 6.3 lists the core values for More Than Wheels, which has a mission “To help strug- gling individuals & families break the cycle of poor financial decision making by using the car buying process to catalyze lasting change, financial stability and control.”24 Most importantly, leaders articulate and uphold high ethical standards, and they behave morally even if they think no one is looking. If leaders cut corners or bend the rules when they think they won’t get caught, they and their organiza- tions will ultimately suffer the consequences.

There is some evidence that doing right by employees, customers, and the commu- nity, as well as by shareholders, is good business. For example, a recent study of the top 100 global companies that have made a commitment to environmental sustainability found they had significantly higher sales growth, return on assets, profits, and cash flow from operations in at least some areas of business.25 Another review of the finan- cial performance of large U.S. corporations considered “best corporate citizens” found that they enjoy both superior reputations and superior financial performance.26 Simi- larly, Governance Metrics International, an independent corporate governance ratings agency in New York, reports that the stocks of companies run on more selfless princi- ples perform better than those run in a self-serving manner.27

BECOMING A MORAL LEADER Leadership is not merely a set of practices with no association with right or wrong. All leadership practices can be used for good or evil and thus have a moral dimen- sion. Leaders choose whether to act from selfishness and greed to diminish others

EXHIBIT 6.3 More Than Wheels Core Values

At More Than Wheels our Core Values guide us in achieving our mission by working with clients and partners towards the goal of building lasting financial outcomes for our clients.

Trust We respect and believe in one another and in our customers. We speak the truth to each other, even when it’s hard. We value one another’s opinions.

Nonjudgmental We deal with current reality, without judgment. We are pragmatic and forward-looking.

Accountability We live up to our agreements. We are relentless about reaching our goals and creatively solving problems. We do the very best we can for our clients.

Teamwork We value collaboration. Our success relies on teamwork.

Learning We learn from one another and from our successes and failures. We strive for continual and meaningful improvement in our work.

Source: More Than Wheels Mission and Core Values, http://www.morethanwheels.org/mission (Retrieved May 18, 2013).

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 173

or to behave in ways that serve others and motivate people to expand their poten- tial as employees and as human beings.28 Moral leadership is about distinguishing right from wrong and doing right, seeking the just, the honest, the good, and the right conduct in achieving goals and fulfilling purpose. Leaders have great influence over others, and moral leadership uplifts people and enhances the lives of others. Immoral leadership takes away from others in order to enhance oneself.29

Leaders most often know what is right; the question becomes how they choose to act on it and what internal strengths and external policies and processes are in place to enable them to follow through on doing the right thing.30 One internal characteristic that influences a leader’s capacity to make moral choices is the indivi- dual’s level of moral development.31 Exhibit 6.4 shows a simplified illustration of one model of personal moral development.

At the preconventional level, individuals are egocentric and concerned with receiving external rewards and avoiding punishments. They obey authority and fol- low rules to avoid detrimental personal consequences or satisfy immediate self- interests. The basic orientation toward the world is one of taking what one can get. Someone with this orientation in a leadership position would tend to be auto- cratic toward others and use the position for personal advancement.

At level two, the conventional level, people learn to conform to the expectations of good behavior as defined by colleagues, family, friends, and society. People at this level follow the rules, norms, and values in the corporate culture. If the rules are to not steal, cheat, make false promises, or violate regulatory laws, a person at this level will attempt to obey. People at the conventional level adhere to the norms of the larger social system. If the social system says it is okay to inflate bills to the government or make achieving the bottom line more important than honesty and integrity, they will usually go along with that norm also. Consider the recent cheating scandals that have rocked several respected schools, including the Air Force Academy, Stuyvesant High School in Manhattan, and Harvard University. Interviews with students and former students at Stuyvesant indicate that many of them were simply going along with the

EXHIBIT 6.4 Three Levels of Personal Moral Development

Sources: Based on Lawrence Kohlberg, “Moral Stages and Moralization: The Cognitive-Developmental Approach,” in Moral Development and Behavior: Theory, Research, and Social Issues, ed. Thomas Likona (Austin, TX: Holt, Rinehart and Winston, 1976), pp. 31–53; and Jill W. Graham, “Leadership, Moral Development, and Citizenship Behavior,” Business Ethics Quarterly 5, no. 1 (January 1995), pp. 43–54.

Moral leadership distinguishing right from wrong and doing right; seeking the just, honest, and good in the practice of leadership

Preconventional level the level of personal moral development in which indi- viduals are egocentric and concerned with receiving external rewards and avoid- ing punishments

Conventional level the level of personal moral development in which peo- ple learn to conform to the expectations of good be- havior as defined by collea- gues, family, friends, and society

174 PART 3 THE PERSONAL SIDE OF LEADERSHIP

system, a culture in which students band together and cheat in a common understanding that it is a “necessary evil” to reach their goals. Many classes have private Facebook groups, for instance, where students can post full sets of answers to tests—one student said it is expected that people will help each other out.32 Howard Gardner, a professor at the Graduate School of Education, says “the ethical muscles [of students] have atrophied” because of a broader societal culture that exalts success at any cost—going along with the system.33

At the postconventional level, sometimes called the principled level, leaders are guided by an internalized set of principles universally recognized as just and right. Peo- ple at this level may even disobey rules or laws that violate these principles. These inter- nalized values become more important than the expectations of other people in the organization or community. Would students at a postconventional level of moral devel- opment cheat on tests as those mentioned above did, since others were cheating to get ahead? A recent study suggests they would not. In a stock trading simulation, research- ers gave randomly selected business school students “insider information” on actual stock earnings, allowing them to accept or reject the information. Those students who rejected the insider information scored higher on moral development, in the postcon- ventional range, whereas those who accepted the information scored at lower levels.34

Most adults operate at level two of moral development, and some have not advanced beyond level one. Only about 20 percent of American adults reach the third, postconventional level of moral development, although most of us have the capacity to do so.35 A leader at this level is visionary, empowering, and committed to serving others and a higher cause. These leaders can impartially apply universal standards to resolve moral conflicts and balance self-interest with a concern for others and for the common good. Research has consistently found a direct relationship between higher levels of moral development and more ethical behavior on the job, including less cheating, a tendency toward helpfulness to others, and the reporting of unethical or illegal acts, known as whistleblowing.36

SERVANT LEADERSHIP What is a leader’s moral responsibility toward followers? Is it to limit and control them to meet the needs of the organization? Is it to pay them a fair wage? Or is it to enable them to grow and create and expand themselves as human beings?

Much of the thinking about leadership today implies that moral leadership involves turning followers into leaders, thereby developing their potential rather than using a leadership position to control or limit people. The ultimate expression of this leadership approach is called servant leadership, which can best be understood by comparing it to other approaches. Exhibit 6.5 illustrates a continuum of leadership thinking and prac- tice. Traditional organizations were based on the idea that the leader is in charge of sub- ordinates and the success of the organization depends on leader control over followers. In the first stage, subordinates are passive—not expected to think for themselves but sim- ply to do as they are told. Stage two in the continuum involves subordinates more actively in their own work. Stage three is stewardship, which represents a significant shift in mindset by moving responsibility and authority from leaders to followers.

Servant leadership represents a stage beyond stewardship, where leaders give up control and make a choice to serve employees. Along the continuum, the focus of leadership shifts from leader to followers. In the following sections, we discuss each stage of this leadership continuum in more detail.

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 175

Postconventional level the level of personal moral development in which leaders are guided by an internalized set of principles universally recognized as right

Authoritarian Management The traditional understanding of leadership is that leaders are good managers who direct and control their people. Followers are obedient subordinates who follow orders. In Chapter 2, we discussed the autocratic leader, who makes the decisions and announces them to subordinates. Power, purpose, and privilege reside with those at the top of the organization. At this stage, leaders set the strategy and goals, as well as the methods and rewards for attaining them. Organizational stability and efficiency are paramount, and followers are routinized and controlled along with machines and raw materials. Subordinates are given no voice in creating meaning and purpose for their work and no discretion as to how they perform their jobs. This leadership mindset emphasizes tight top-down control, employee standardiza- tion and specialization, and management by impersonal measurement and analysis.

Participative Management Since the 1980s, many organizations have made efforts to actively involve employ- ees. Leaders have increased employee participation through employee suggestion programs, participation groups, and quality circles. Teamwork has become an important part of how work is done in most organizations. Studies indicate that around 70 percent of the largest U.S. corporations have adopted some kind of employee participation program or shifted to a team design. However, many of these programs do not redistribute power and authority to lower-level workers.37

The mindset is still paternalistic in that leaders determine purpose and goals, make final decisions, and decide rewards. Employees are expected to make suggestions for quality improvements, act as team players, and take greater responsibility for their own jobs, but they are not allowed to be true partners in the enterprise.38

EXHIBIT 6.5 Changing Leader Focus from Self to Others

176 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Stewardship Stewardship is a pivotal shift in leadership thinking. Stewardship means that leaders are guardians and curators of organizational resources and values and they place the long-term interests of the organization first.39 As stewards, leaders empower fol- lowers to make decisions and have control over how they do their own jobs. Four principles provide the framework for stewardship.

1. Adopt a partnership mindset. Partnership can happen only when power and control shift away from formal leaders to core employees. As partners, leaders and followers are totally honest with one another, jointly responsible for defining vision and pur- pose, and mutually accountable for outcomes that benefit the whole.

2. Give decision-making power and the authority to act to those closest to the work and the customer. This means reintegrating the “managing” and the “doing” of work, so that everyone becomes a leader and is also doing some of the core work of the organization. Nobody gets paid simply to plan and manage the work of others.

3. Tie rewards to contributions rather than formal positions. With stewardship, everyone’s fortunes are connected to the success of the enterprise. Stewardship involves redistributing wealth by designing compensation so that people can make significant gains when they make exceptional contributions.

4. Expect core work teams to build the organization. Teams of employees define goals, maintain controls, create a nurturing environment, and organize and reorganize themselves to respond to a changing environment and marketplace.

Stewardship leaders guide the organization without dominating it and facilitate followers without controlling them. At Julia’s House, a children’s hospice in Dorset (United Kingdom) that has won numerous awards including The Sunday Times Best Companies award, the CEO and all department heads sit in an open-plan office with other staff to signal a partnership approach. The organization chart was redesigned to read left to right rather than the usual vertical hierarchy.40 Stew- ardship allows for a relationship between leaders and followers in which each makes significant, self-responsible contributions to organizational success. In addi- tion, it gives followers a chance to use their minds, bodies, and spirits on the job, thereby allowing them to be whole human beings.

The Servant Leader Servant leadership takes stewardship assumptions about leaders and followers one step further. Robert Wood Johnson, who built Johnson & Johnson from a small private company into one of the world’s greatest corporations, summarized his ideas about management in the expression “to serve.” In a statement called “Our Management Philosophy,” Johnson went on to say, “It is the duty of the leader to be a servant to those responsible to him.”41 Johnson died decades ago, but his beliefs about the moral responsibility of a leader are as fresh and compelling (and perhaps as controversial) today as they were when he wrote them.

Servant leadership is leadership upside down. Servant leaders transcend self- interest to serve the needs of others, help others grow and develop, and provide opportunity for others to gain materially and emotionally. Fred Keller has built a $250 million plastics manufacturing company, Cascade Engineering, by continuously asking one question: What good can we do? Keller started the business 40 years ago with six employees. Today, it has 1,000 employees in 15 business divisions. Keller

NEW LEADER ACTION MEMO As a leader, you can apply the principles of stewardship and treat followers as true partners by sharing power and author- ity for setting goals, making decisions, and maintaining control over their own work and performance.

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 177

Stewardship a belief that leaders are deeply accountable to others as well as to the organization, without trying to control others, define meaning and purpose for others, or take care of others

Servant leadership leadership in which the leader transcends self- interest to serve the needs of others, help others grow, and provide opportunities for others to gain materially and emotionally

has made serving others a cornerstone of the business. The company offers jobs to welfare recipients, and Keller donates large amounts to various philanthropic causes, both as an individual and through Cascade.42

There has been an explosion of interest in the concept of leader as servant in recent years.43 Servant leadership was first described by Robert Greenleaf in his book, Servant Leadership.44 There are four basic precepts in Greenleaf’s model:45

1. Put service before self-interest. In this view, the organization exists as much to provide meaningful work to the person as the person exists to perform work for the organization.

2. Listen first to affirm others. One of the servant leader’s greatest gifts to others is listening authentically.

3. Inspire trust by being trustworthy. Servant leaders build trust by doing what they say they will do, being honest with others, and focusing on the well-being of others.

4. Nourish others and help them become whole. Servant leaders care about fol- lowers and believe in the unique potential of each person to have a positive impact on the world.

The servant leader’s top priority is service to employees, customers, share- holders, and the general public. Leadership flows out of the act of service because it enables other people to grow and become all they are capable of being.46 For organizational psychologist Adam Grant, serving others provides powerful motiva- tion and creative energy, as described in the following example.

IN THE LEAD Adam Grant, Wharton School of the University of Pennsylvania Adam Grant has been studying the power of service to others since he was an undergraduate student at Harvard. He took a job selling advertisements for a travel guide series but didn’t do so well. Only when he met another student and learned that her job at the same company was essential for paying her way through college did he find purpose and meaning in his work. He eventually sold the largest advertising package in company history. “When I was representing the interests of students, I was willing to fight to protect them,” he says.

Grant went on to earn a graduate degree in organizational psychology and now teaches at the Wharton School, where he is the youngest-tenured and highest-rated professor. Grant goes far beyond the typical professor in helping students. He writes lengthy letters of recom- mendation for students or former students approximately 100 times a year. He provides intro- ductions for students to influential people he knows. He answers hundreds of e-mail messages a day from students, colleagues, and even people he doesn’t know, providing information or assistance. Helpfulness is the watchword Grant lives by. Moreover, he argues that the greatest untapped source of motivation and productivity in organizations is service to others.

Grant has hard data from several experiments to back up his claim that focusing on the contributions we make to improve other people’s lives makes us more motivated and productive. For example, call center workers seeking donations to fund college scholarships increased their effort and brought in 171Ĝpercent more revenue after hearing a student talk about how his life had been changed by a scholarship—even though the workers themselves didn’t think they had been influenced by the student’s brief talk.47

NEW LEADER ACTION MEMO As a leader, you can put the needs, interests, and goals of others above your own and use your personal gifts to help others achieve their potential. Complete the questionnaire in Leader’s Self-Insight 6.2 to evaluate your leadership ap- proach along the dimensions of authoritarian leadership, par- ticipative leadership, steward- ship, and servant leadership.

178 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Grant’s insights suggest that servant leadership can mean something as simple as encouraging others in their personal development and helping them understand the larger purpose in their work. ServiceMaster, which cleans and maintains hospitals, schools, and other buildings, provides a good example. Leaders care how employees feel about themselves, about their work, and about the people they interact with. They instill a sense of dignity, responsibility, and meaningfulness in menial tasks like scrubbing floors and cleaning toilets. One employee who works in a hospital, for example, says she sees herself as part of a team that helps sick people get well.48

LEADING WITH COURAGE Leaders sometimes have to reach deep within themselves to find the courage and strength of character to serve others, resist temptation, behave morally, or stand up for ethical principles when others may ridicule them or when they may suffer financially or emotionally for their actions.

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 6.2

Your Servant Leadership Orientation

Instructions: Think about situations in which you were in a formal or informal leadership role in a group or organization. Imagine using your personal approach as a leader. To what extent does each of the following statements characterize your leadership? Please answer whether each item below is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. My actions meet the needs of others before my own.

2. I explicitly enable others to feel ownership for their work.

3. I like to consult with people when making a decision.

4. I’m a perfectionist. 5. I like to be of service to others. 6. I try to learn the needs and per-

spectives of others. 7. I consciously utilize the skills and

talents of others. 8. I am assertive about the right way

to do things. 9. I give away credit and recognition

to others. 10. I believe that others have good

intentions. 11. I quickly inform others of devel-

opments that affect their work. 12. I tend to automatically take charge. 13. I encourage the growth of others,

expecting nothing in return.

14. I value cooperation over competi- tion as a way to energize people.

15. I involve others in planning and goal setting.

16. I put people under pressure when needed.

Scoring and Interpretation There are four subscale scores that represent four dimensions of leadership—authoritarian, participative, stewardship, and servant. For each dimension below, give yourself one point for each Mostly True response to the items indicated.

My leadership scores are:

Authoritarian, items 4, 8, 12, 16: Participative, items 2, 6, 10, 14: Stewardship, items 3, 7, 11, 15: Servant, items 1, 5, 9, 13:

These scores represent the four aspects of leadership called authoritarian, participative, stewardship, and servant as described in the text and illustrated in Exhibit 6.5. A score of 3Ģ4 on any of these dimensions would be considered above average, and a score of 0–1 is below average.

Compare your four scores to each other to understand your approach to stewardship and servant leadership. On which of the four dimensions would you like to have the highest score? The lowest? Study the specific questions on which you scored Mostly True or Mostly False to analyze your pattern of strengths and weaknesses. It is not possible to display all four dimensions of leadership simultaneously, so you should think about the dimension you want to emphasize to reflect your leader ideal. ©

Ce ng ag e Le ar ni ng

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179 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Some would say that without courage, leadership cannot exist.49 However, for many leaders, particularly those working in large organizations, the impor- tance of courage is easily obscured—the main thing is to get along, fit in, and do whatever brings promotions and pay raises. In a world of stability and abun- dance, leaders can often forget even the meaning of courage, so how can they know where to find it when they need it? In the following sections, we examine the nature of leadership courage and discuss some ways courage is expressed in organizations. The final section of the chapter explores the sources of leadership courage.

What Is Courage? Many people know intuitively that courage can carry you through deprivation, ridi- cule, and rejection and enable you to achieve something about which you care deeply. Courage is both a moral and a practical matter for leaders. A lack of courage is what allows greed and self-interest to overcome concern for the common good.50

Courage is the mental and moral strength to engage in, persevere through, and with- stand danger, difficulty, or fear. Courage doesn’t mean the absence of doubt, confu- sion, or fear, but the ability to act in spite of them when it is necessary for the greater good. In fact, if there were no fear or doubt, courage would not be needed.

The courage to take risks has always been important for living a full, rewarding life, as discussed in the Consider This box. Yet the courage to resist jumping on the bandwagon and taking unnecessary or unethical risks is equally important. For today’s organizations, things are constantly changing, and leaders thrive by solving problems through trial and error. They create the future by moving forward in the face of uncertainty, by taking chances, by acting with courage.51

K Consider Is It Worth the Risk?

To laugh … is to risk appearing the fool. To weep … is to risk appearing sentimental. To reach out … is to risk involvement. To expose feelings … is to risk exposing your true self. To place your ideas and dreams before a crowd … is to risk rejection. To love … is to risk not being loved in return. To live … is to risk dying. To hope … is to risk despair. To try … is to risk failure. But risks must be taken, because the greatest hazard in life is to risk nothing. Those who

risk nothing do nothing and have nothing. They may avoid suffering and sorrow, but they cannot learn, feel, change, grow, or love. Chained by their certitude, they are slaves; they have forfeited their freedom. Only one who risks is free.

Leadership must start from

within—from within the leader’s heart—where real courage resides.

Peter Voyer, senior artillery officer in

the Canadian Army

Courage the mental and moral strength to engage in, persevere through, and withstand danger, difficulty, or fear

180 PART 3 THE PERSONAL SIDE OF LEADERSHIP

People experience all kinds of fears, including fear of death, mistakes, failure, embarrassment, change, loss of control, loneliness, pain, uncertainty, abuse, rejection, success, and public speaking. It is natural and right for people to feel fear when real risk is involved, whether the risk is losing your life, losing your job, losing a loved one, or losing your reputation.

However, many times it isn’t fear as an actual threat that holds people back, but rather F.E.A.R., which stands for False Evidence Appearing Real. This kind of “fear” arises not from a true threat but from our own thoughts. This type of fear might be better termed anxiety, and this is what writer Seth Godin had to say about it: “Anxiety is nothing but repeatedly re-experiencing failure in advance. What a waste.”52 This reflects that many fears are learned and prevent people from doing what they want. Adam Grant, the Wharton professor profiled earlier in this chap- ter, for example, had a phobia about speaking in public, so he forced himself as a graduate student to lecture as much as possible and take advantage of every oppor- tunity to speak publicly so he could learn to step through the fear (really F.E.A.R.) that was holding him back from achieving his goals.53 True leaders step through these learned fears to accept responsibility, take risks, make changes, speak their minds, and fight for what they believe.

Courage Means Accepting Responsibility Leaders make a real difference in the world when they are willing to step up and take personal responsibility. Some people just let life happen to them; leaders make things happen. Courageous leaders create opportu- nities to make a difference in their organizations and communities. One example is Malala Yousafzai, the young girl shot by the Taliban who was described in the chap- ter opening example. A business example is John W. Rowe, former chairman and CEO of Aetna. When Rowe, a gerontologist and professor of medicine, was hired in 2000, Aetna was in shambles. The investment community viewed Rowe’s appoint- ment with skepticism. One analyst even told Rowe he expected the company’s perfor- mance to decline with him in charge. Rowe didn’t let that bother him; he simply accepted responsibility for fixing what was wrong and redefined the mission and core values to focus on quality care, which he made the guiding principle for all com- pany decisions. By the time Rowe retired in 2006, Aetna had gone from last place to first in trustworthiness and went from losing $1 million to making $5 million a day.54

Courage Often Means Nonconformity Leadership courage means going against the grain, breaking traditions, reducing boundaries, and initiating change. Leaders are will- ing to take risks for a larger, ethical purpose, and they encourage others to do so.

Going against the status quo can be difficult. Consider the case of Paula Reid, who went against the “boys will be boys” status quo at the U.S. Secret Service in breaking open the Cartagena prostitution scandal.

IN THE LEAD Paula Reid, U.S. Secret Service Prostitution is legal in Cartagena, Colombia, but when a U.S. Secret Service agent allegedly refused to pay, it set off a scandal that got several agents fired and tarnished the agency’s reputation. Paula Reid, the new supervising manager for the Miami office of the U.S. Secret Service, a prestigious division that oversees the South American region, acted swiftly when

To see if you are dealing with false evidence appearing real, log in to CengageNOW to complete the interactive questionnaire.

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 181

she received a report of a disturbance at the hotel where agents preparing for President Barack Obama’s visit to Cartagena were staying. Reid didn’t particularly care whether prosti- tution was legal or illegal. The bottom line for her was that visits to strip clubs, heavy drink- ing, and hiring prostitutes are not acceptable ethical behaviors for Secret Service agents charged with protecting the president of the United States.

Based on information from the hotel manager, Reid swiftly rounded up a dozen agents, ordered them out of the country, and notified her superiors that she had found evi- dence of “egregious misconduct.” The resulting scandal threw the Secret Service into tur- moil and put Director Mark Sullivan and other top leaders on the hot seat. Yet, for Reid, the “boys will be boys” mentality is not acceptable in today’s world. “If every boss was Paula Reid,” said a former agent, “the Secret Service would never have a problem. It would be a lot more boring, but never a problem.”55

The U.S. Secret Service has apparently tolerated moral lapses in the behavior of agents over the years, but Paula Reid believed that had to change. She acted in spite of a potential internal backlash because she believed the actions of the agents both hurt the agency’s reputation and damaged its ability to fulfill its protective and investigative missions.

Most leaders initiating change find some cooperation and support, but they also encounter resistance, rejection, loneliness, and even ridicule. It’s often easier to stay with what is familiar, even if it will lead to certain failure, than to initiate bold change.

Courage Means Pushing beyond the Comfort Zone To take a chance and improve things means leaders have to push beyond their comfort zone. When people go beyond the comfort zone, they encounter an internal “wall of fear.” A social experiment from 30 years ago illustrates the wall of fear that rises when people push beyond their comfort zone. To explore the web of unwritten rules that gov- ern people’s behavior on New York City subways, Dr. Stanley Milgram asked his first-year graduate students to board a crowded train and ask someone for a seat. Milgram’s focus of interest soon shifted to the students themselves, as the seemingly simple assignment proved to be extremely difficult, even trau- matic. Most students found it decidedly uncomfortable to bluntly ask someone for a seat. One now says of the experiment: “I was afraid I was going to throw up.”56 People may encounter the internal wall of fear when about to ask some- one for a date, confront the boss, break off a relationship, launch an expensive project, or change careers. Facing the internal wall of fear is when courage is needed most.

Courage Means Asking for What You Want and Saying What You Think Leaders have to speak out to influence others. However, the desire to please others—especially the boss—can sometimes block the truth. Everyone wants approval, so it is difficult to say things when you think others will disagree or disapprove. Author and scholar Jerry Harvey tells a story of how members of his extended family in Texas decided to drive 40 miles to Abilene for dinner on a hot day when the car air conditioning did not work. They were all miserable. Talking about it afterward, each person admitted they had not wanted to go but went along to please the others. The Abilene Paradox is the name Harvey uses to describe the tendency of people to not voice their

NEW LEADER ACTION MEMO As a leader, you can develop the backbone to accept per- sonal responsibility for achiev- ing desired outcomes, going against the status quo, and standing up for what you be- lieve. You can learn to push beyond your comfort zone and break through the fear that limits you.

182 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Abilene Paradox the tendency of people to resist voicing their true thoughts or feelings in order to please others and avoid conflict

true thoughts because they want to please others.57 Courage means speaking your mind even when you know others may disagree with you and may even deride you. Courage also means asking for what you want and setting boundaries. It is the ability to say no to unreasonable demands from others, as well as the ability to ask for what you want to help achieve the vision.

Courage Means Fighting for What You Believe Courage means fighting for valued outcomes that benefit the whole. Leaders take risks, but they do so for a higher pur- pose. For example, Ashok Khemka has been a government worker in India for 21 years, and during that time period he has been demoted or transferred to another department 43 times. Why? Because Khemka is a tireless fighter against corruption, and sometimes he ruffles the wrong feathers. Some people—especially bosses who are bending the rules—see him as a troublemaker, but India’s anti- corruption activists and many people in the community fully support him. “There are two kinds of government officers—officers who work only to please their politi- cal masters, and other officers [like Khemka] who work to uphold the law, who work for justice and the poor,” said advocate Kuldip Tiwari.58

How Does Courage Apply to Moral Leadership? There are many people working in organizations who have the courage to be unconventional, to step up and take responsibility, and to do what they believe is right. Balancing profit with people, self-interest with service, and control with stew- ardship requires individual moral courage.

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 6.3

Assess Your Moral Courage

Instructions: Think about situations in which you either assumed or were given a leadership role in a group or organi- zation. Imagine using your own courage as a leader. To what extent does each of the following statements characterize your leadership? Please answer whether each item below is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I risk substantial personal loss to achieve the vision.

2. I take personal risks to defend my beliefs.

3. I say no even if I have a lot to lose. 4. I consciously link my actions to

higher values. 5. I don’t hesitate to act against

the opinions and approval of others.

6. I quickly tell people the truth, even when it is negative.

7. I feel relaxed most of the time.

8. I speak out against organizational injustice.

9. I stand up to people if they make offensive remarks.

10. I act according to my conscience even if it means I lose status and approval.

Scoring and Interpretation Each question above pertains to some aspect of displaying courage in a leadership situation. Add up your points for Mostly True answers: . If you received a score of 7 or higher, you have real potential to act as a courageous leader. A score below 3 indicates that you avoid difficult issues or have not been in situations that challenge your moral leadership. Is your score consistent with your under- standing of your own courage? Look at the individual ques- tions for which you scored Mostly False or Mostly True and think about your specific strengths and weaknesses. Compare your score to that of other students. How might you increase your courage as a leader? Do you want to? ©

Ce ng ag e Le ar ni ng

| D re am

st im e. co m

NEW LEADER ACTION MEMO Assess your level of leadership courage by completing the ex- ercise in Leader’s Self-Insight 6.3.

183 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Acting Like a Moral Leader Requires Personal Courage To practice moral leader- ship, leaders have to know themselves, understand their strengths and weaknesses, know what they stand for, and often be nonconformists. Honest self-analysis can be painful, and acknowledging one’s limitations in order to recognize the superior abil- ities of others takes personal strength of character. In addition, moral leadership means building relationships, which requires listening, having significant personal experiences with others, and making yourself vulnerable—qualities that frighten many people. Yet, by getting close and doing what is best for others—sharing the good and the bad, the pain and anger as well as the success and the joy—leaders bring out the best qualities in others.59

An example of this in practice is when William Peace had to initiate a layoff as general manager of the Synthetic Fuels Division of Westinghouse. Peace had the courage to deliver the news about layoffs personally. He took some painful blows in the face-to-face meetings he held with the workers to be laid off, but he believed allowing people to vent their grief and anger at him and the situation was the moral thing to do. His action sent a message that leaders valued employees as human beings with feelings. Thus, employees rededicated themselves to helping save the division.60 For Peace, the courage to practice moral leadership by personally facing employees gained respect, renewed commitment, and higher performance, even though he suffered personally in the short run.

Opposing Unethical Conduct Requires Courage Whistleblowing means employee dis- closure of illegal, immoral, or unethical practices in the organization.61 One recent example is Charles M. Smith, who was the senior civilian overseeing the U.S. Army’s multibillion-dollar contract with KBR when he faced a test of courage. Smith couldn’t find evidence justifying more than $1 billion in costs for food, hous- ing, and others services from the contractor, but he was being asked to approve the payments anyway. He refused to sign off, despite pressures from both Army and civilian officials. Smith was removed from his job and transferred to another posi- tion. He retired soon afterward and went to the media with the story.62

As this example shows, it is highly risky for employees to blow the whistle because they may lose their jobs, be ostracized by coworkers, or be transferred to undesirable positions. Michael Woodford, former president and CEO of Olympus, describes what it was like to be at the center of a major whistleblowing scandal.

IN THE LEAD Michael Woodford, Olympus Michael Woodford had been with camera maker Olympus for 30 years when he was named president and CEO in early 2011. That appointment turned out to be the end of his career with the company as well.

Woodford soon discovered that unauthorized payments had been made to third par- ties in an effort to hide significant losses. He went to the board, but they ignored his find- ings. “I begged them to do what was right. I was the president and I was trying to expose a fraud,” he says.

After he went public, Woodford was voted out of a job. He describes what happened next: “I was petrified. You feel your career is slipping away. You fear for your safety … there were implications of ‘anti-social forces,’ which means the yakuza [Japanese mafia].”

Whistleblowing employee disclosure of ille- gal, immoral, or unethical practices in the organization

184 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Woodford says as painful as the experience was, it was a huge education, and he has no regrets for doing the right thing. The entire board at Olympus eventually resigned, and three senior executives pleaded guilty to fraud.63

Most whistleblowers, like Charles Smith and Michael Woodford, realize they may suffer financially and emotionally, but they act courageously to do what they think is right. As Woodford says, “If you know something is wrong and you don’t deal with it, you are complicit.”64

Finding Personal Courage How does a leader find the courage to step through fear and confusion, to act despite the risks involved? All of us have the potential to live and act courageously. There are a number of ways leaders can unlock the courage within themselves, including committing to causes they believe in, connecting with others, harnessing anger, and developing their skills.

Believe in a Higher Purpose Courage comes easily when we fight for something we really believe in. Leaders who have a strong emotional commitment to a larger vision or purpose find the courage to step through fear. When Charles Smith, the leader who refused to pay KBR, was asked about his decision, he said, “Ultimately, the money that was going to KBR was money being taken away from the troops, and I wasn’t going to do that.”65 For Smith, caring about the well-being of soldiers gave him the courage to refuse payments to a contractor that he believed were fraudulent. Noorjahan Akbar, the 21-year-old founder of Young Women for Change, says numerous activists fighting for women’s rights in Afghanistan have been injured or killed, but it only strengthened their resolve to push for change. Akbar and others don’t risk their lives just for the thrill of it. They do it for a cause they deeply believe in.66

Draw Strength from Others Caring about others and having support from others is a potent source of courage in a topsy-turvy world. Support for this proposition comes from studies of the civil right movement in the Southern United States in the 1960s. In the Mississippi Freedom Summer Project, young volunteers were recruited to regis- ter black voters, run Freedom Schools, and raise civil rights awareness. Within days of the volunteers arriving in Mississippi, three were kidnapped and killed. Through- out the summer, dozens of churches were set on fire, safe houses were bombed, and volunteers were shot at, beaten, and arrested. A quarter of the volunteers in the pro- gram dropped out. Researchers have looked at what distinguished those who stayed from those who left. The volunteers who stayed were far more likely to have what is referred to as strong ties, close friends who were also in the program and people they were close to back home who were deeply interested in their lives and activities. Those who left the program were just as committed to the goals and purpose, but they typically didn’t have the same social support.67

People who feel alone in the world take fewer risks because they have more to lose.68 Interestingly, although social media such as Twitter and Facebook has made it easier for people to join with others to support social causes or push for change within organizations, there is some evidence that social media actually reduces strong ties (deep personal connections), making it harder for people to express courage when they need it.69

NEW LEADER ACTION MEMO As a leader, you can find your personal courage by commit- ting to something you deeply believe in. You can welcome potential failure as a means of growth and development and build bonds of caring and mutual support with family, friends, and colleagues to reduce fear.

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 185

Harness Frustration and Anger If you have ever been really angry about something, you know that it can cause you to forget about fear of failure, fear of embarrassment, or fear that others won’t like you. Peggy Payne, now in her mid-60s, has had a highly successful career as a journalist and author but says she still gets angry when she thinks about not being chosen to attend the prestigious Governor’s School of North Carolina when she was 16 years old. The anger, she says, helped fuel a commitment to show everyone she could be successful.70 Frustration and anger spurred Glenn McIntyre to found a company. After he was paralyzed in a motorcycle accident, McIntyre got angry every time he stayed at a hotel. His anger and frustration over how poorly hotels served disabled guests gave him the courage to stop feeling sorry for himself and start a new business, Access Designs. The firm helps hotels such as Quality Suites and Renaissance Ramada redesign their space to be more usable for disabled travelers.71 Anger, in moderate amounts, is a healthy emotion that provides energy to move forward. The challenge is to harness anger and use it appropriately.72

Take Small Steps In most cases within organizations, finding courage is a deliberate act rather than an instantaneous response.73 Courage can be thought of as a decision- making skill that is developed through conscious thought and practice. Courageous leaders are not reckless and foolhardy; they typically are people who have developed

LEADER’S BOOKSHELF Courage Goes to Work: How to Build Backbones, Boost Performance, and Get Results

by Bill Treasurer

Bill Treasurer, the author of Courage Goes to Work, grew up in a household where lessons about courage were treated as importantly as lessons about history or arithmetic. That gave him an early understanding of courage as a skill that is developed with practice and strength- ened when it is used. The founder and chief encouragement officer at Giant Leap Consulting, Treasurer draws upon his experiences helping people and organizations be more courageous to give us all some tips in this book.

THREE TYPES OF COURAGE “Courage is, most often, a behavioral response to a challenge,” writes Treasurer. “As a manager, you have a responsibility, indeed an obligation, to activate the cour- age of those around you.” To tap into and strengthen one’s own courage and the courage of followers, leaders can under- stand three types of courage that are important in the workplace.

• Try Courage. This is the courage to take initiative, to “step up to the plate” rather than playing it safe. To

help followers practice try courage skills, leaders help people build on their strengths, provide challenging assignments that require people to stretch themselves, encourage novel approaches and experimentation, accept mistakes, and reward persis- tence in the face of obstacles.

• Trust Courage. The second type of courage is the courage to trust and rely on others. Leaders trust others to gain trust in return. They give people the benefit of the doubt, and they give employees lots of lati- tude in how to accomplish their tasks. Leaders build trust courage by respecting followers, being hon- est but kind and courteous, and get- ting to know people on an emotional level. They can help fol- lowers practice trust courage by encouraging them to open up about their feelings, desires, dreams, and fears.

• Tell Courage. “I have come to believe that the TELL Courage bucket is the one most in need of

filling,” says Treasurer. When people are afraid to speak up about mis- takes, voice contrary opinions, ques- tion their leaders, and point out wrongdoing, companies suffer, as many leaders have learned in recent years. Leaders build tell courage by encouraging people to speak up, genuinely listening to others, not taking things personally, avoiding blame and defensiveness, and, when appropriate, acting on what they are told.

MODELING COURAGE “When your behaviors are directed by courageous impulses, you are operating out of your best and bravest self,” writes Treasurer. “When other people witness your newfound behaviors … they grad- ually step into their own courage, too.” To help others find and develop their courage means leaders must first find and develop their own.

Source: Courage Goes to Work, by Bill Treasurer, is published by Berrett-Koehler.

hu tte rs to ck

186 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

the skills and resources they need to take a difficult stand or pursue a tough course of action. In addition, courageous leaders can develop courageous followers by modeling courage in their own behavior and by helping people practice courage, as described in this chapter’s Leader’s Bookshelf.

One leader who was promoted to CFO was being pressured to restate restructur- ing charges so it would look more favorable and help the stock price. Rather than sim- ply refusing to do so, this leader developed an integrity campaign, reminding people of the firm’s strong tradition of values-driven leadership. This provided support to other leaders who didn’t want to go along with the unethical behavior but didn’t have the courage to resist pressures from more senior executives.74 Good leaders remind them- selves that dealing with difficult ethical issues is a crucial part of their jobs.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • This chapter explored a number of ideas concerning moral leadership and lead-

ership courage. People want honest and trustworthy leaders. However, leaders face many pressures that challenge their ability to do the right thing—pressures to cut costs, increase profits, meet the demands of various stakeholders, and look successful. Creating an ethical organization requires that leaders act based on moral principles.

• Leaders are the symbols for the organization’s ethical climate. When they exces- sively promote self-interest, practice deception and breach agreements, and lack the courage to confront unjust acts, they hurt the organization and everyone associated with it. Ethical leaders are humble, honest, and straightforward. They maintain a concern for the greater good, strive for fairness, and demon- strate the courage to stand up for what is right. Acting as a moral leader means demonstrating the importance of serving people and society as well as increas- ing profits or personal gain.

• One personal consideration for leaders is the level of moral development. Lea- ders use an understanding of the stages of moral development to enhance their own as well as followers’ moral growth. Leaders who operate at higher stages of moral development focus on the needs of followers and universal moral principles.

• Ideas about control versus service between leaders and followers are changing and expanding, reflected in a continuum of leader–follower relationships. The continuum varies from authoritarian managers to participative managers to stewardship to servant leadership. Leaders who operate from the principles of stewardship and servant leadership can help build ethical organizations.

• The final sections of the chapter discussed leadership courage and how leaders can find their own courage. Courage means having the mental and moral strength to confront, persevere through, and withstand danger, difficulty, or fear. Courageous leaders accept responsibility, take risks and make changes, speak their minds, and fight for what they believe. Two expressions of courage in organizations are moral leadership and ethical whistleblowing. Sources of courage include belief in a higher purpose, connection with others, harnessing anger, and developing courage step by step.

Tw itt er

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 187

DISCUSSION QUESTIONS 1. What are some pressures you face as a student that challenge your ability to do the right

thing? Do you expect to face more or fewer pressures as a leader? Discuss what some of these pressures might be.

2. If most adults are at a conventional level of moral development, what does this mean for their potential for moral leadership?

3. How might understanding the difference between “fear” and “F.E.A.R.,” as described in the chapter, make you a better leader? Can you name an example from your own life of “false evidence appearing real”?

4. One finding is that when leaders are under stress so that fear and risk increase, they tend to revert to an authoritarian, command-and-control style. As a leader, how might you find the courage to resist this tendency?

5. If you were in a position as a student similar to Mike McQueary at Pennsylvania State University, what do you think you would do? Why?

6. Should serving others be placed at a higher moral level than serving oneself? Discuss.

7. If it is immoral to prevent those around you from growing to their fullest potential, are you being moral?

8. Leaders at several organizations, including Hostess Brands (Twinkies), Sbarro, and Block- buster, have gotten significant raises or bonuses shortly before the firms filed for bankruptcy. The companies have argued that it was a necessary step to keep managers during a difficult time. Do you think this is a legitimate argument from an ethical standpoint? Discuss.

9. Do you agree that it is important for leaders to do the right thing even if no one will ever know about it? Why or why not?

10. A consultant recently argued that the emphasis on corporate governance and social responsibility has distracted leaders from key business issues such as serving customers and beating competitors. Do you agree? Should leaders put business issues first or ethi- cal issues first?

Complete this assignment online with CengageNOW.

C a C

LEADERSHIP AT WORK Scary Person Think of a person in your life right now who is something of a scary person for you. Scary people are those you don’t really know but who are scary to you because you anticipate that you won’t like them, perhaps because you don’t like the way they act or look from a distance, and hence you avoid building relationships with them. A scary person might be a student at school, someone at work, a neighbor, or someone you are aware of in your social circle.

Scary people trigger a small amount of fear in us—that is why we avoid them and don’t really get to know them. A test of courage is whether you can step through your fear. You will experience fear many times as a leader.

For this exercise, your assignment is to reach out to one or more scary persons in your life. Invite the person for lunch or just walk up and introduce yourself and start a conversa- tion. Perhaps you can volunteer to work with the person on an assignment. The key thing is to step through your fear and get to know this person well enough to know what he or she is really like.

After you have completed your assignment, share what happened with another person. Were you able to reach out to the scary person? What did you discover about the scary per- son? What did you discover about yourself by doing this activity? If you found the exercise

188 PART 3 THE PERSONAL SIDE OF LEADERSHIP

silly and refused to do it, you may have let F.E.A.R. get the better of you by rationalizing that the assignment has little value.

In Class: The instructor can give this assignment to be done prior to a specific class. During class it is a good exercise for students to discuss their scary person experiences among them- selves in small groups. The instructor can ask students to report to their groups about the scary person, revealing as many details as they are comfortable with, explaining how they summoned the courage to reach out, and the result. After the groups have finished their exchange, the instructor can ask a couple of student volunteers to report their experiences to the entire class. Then students can be asked questions such as: Looking back on this expe- rience, what is courage? How was it expressed (or not) in this exercise? How will fear and courage be part of your organizational leadership?

Check out CengageNOW for additional cases with interactive activities.

C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS “What Should I Say?” The sudden heart attack of his predecessor, Bill Andrews, propelled Russell Hart into a tem- porary top management assignment for Kresk International in the company’s new Middle East Division in Riyadh, Saudi Arabia. Kresk management had targeted Saudi as a must- have division and was enthusiastic about the expansion.

After six months of a one-year assignment in Riyadh with travel throughout the Mid- dle East, Russell was making a brief trip to Dallas to report at the semi-annual board meet- ing before returning to Saudi. He understood that in addition to his assessment of the company’s situation in the region, a portion of the board meeting would focus on the improved health condition of Andrews and, based on that, a determination would be made as to whether he or Bill Andrews would have the permanent assignment at the end of the year. The two were close friends and had corresponded regularly over the past months, and Russell looked forward to Bill’s full recovery and return to work. However, single and adventurous by nature, Russell enjoyed the company’s top assignment and hoped to impress management at the meeting so that he would be named director of the Middle East Division.

“Here’s where my personal ambitions and my personal ethics collide,” Russell admitted to his assistant Christopher Dunn as the Kresk corporate jet left Riyadh. “I mean, look at all of this. It’s a dream job. It’s my dream job and I can do this. If anyone had told me back in high school in Nebraska that I would be on a corporate jet flying from Saudi Arabia, I’d have laughed them out of Sydney.”

“Excuse me, Russell, would you and Christopher care for anything to drink?” the cabin attendant asked.

“Yes, a Jameson,” Russell said. “Same here,” Christopher added. As the attendant walked away, Russell leaned over, speaking quietly. “Corporate is so

enthusiastic about this region. They are expecting nothing short of a glowing report that basically says, ‘Wow, we really hit the jackpot with this move.’ And that’s what we’ve put together here over the past few weeks. It looks fantastic! But my little man in here,” he said, pointing to his stomach, “keeps nagging me—do I give them, ‘Wow, we hit the jackpot’ and become the darling of the company, or do I give them the truth, that we have some potential serious problems with this division . . .”

“… And hand the job to Bill,” Christopher said as the drinks arrived. “Exactly. By the end of the year, their numbers may look great and they may meet our

performance standards, but I have serious problems with the management here. I realize that we’re working with a different culture and I can make allowances. I have no problem pacing my day around their prayer obligations. I know to avoid any business during Ramadan or

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 189

around the two Eids. I’ve become comfortable meeting a sheikh or sayyid* and I’ve even lost my sense of self-consciousness when a businessman holds my hand to lead me into a room. I can deal with all of these things. But there is a level here within the organization that bothers me and that I think would bother most managers at headquarters and that’s what I struggle with in this report. Should I be honest?”

“Well, you know—honesty is the best …” “Don’t say it. This is my career we’re talking about.” “OK, what do you want to add—or not add?” “The major problem here is Youssef Said,” Russell said. “I know. But I think I would stay away from mentioning that. The company loves the guy.

Bill Andrews has been his champion because of excellent results, at least in the short run.” “I don’t agree. And I think they won’t when they see him in action. I don’t understand

why Bill supports him.” “They’ve seen him in action,” Christopher said. “Oh, they’ve seen what he wants them to see. You and I have seen his interaction with

staff and employees on a daily basis. His mistreatment of people is appalling. I see a total disregard for the opinions of others, and he seems to take considerable pleasure in humiliat- ing people. He screams at them! A few have quit. I’ve questioned him about it a couple of times and all he says is, ‘I know. Please understand …’ ”

“It is the way it is done here,” Christopher said, completing the phrase the two heard on a regular basis.

“I don’t believe it is the way it’s done here. It’s not our culture, at least not in the U.S. and Europe. I think this has always been his way. I wonder about the effects on morale, and I think the people who work here will believe the company is in agreement with him and that this is our policy,” Russell said. “Youssef has that little inner circle of family and friends that he trusts and really nothing beyond that. To me, it seems he’s always working a deal, bending a rule. I know that Arabs love to trade and love to negotiate, but there are too many favors, too many unwritten agreements and payments, and I wonder if we should intervene. I wonder if international laws or the company’s own ethics are being set aside. I have serious doubts that this guy is going to work with the Kresk culture and our company ethics. But do I need to include my concerns in this initial report …”

“Or will you just be busting the board’s bubble, and raise doubts about Bill, or perhaps they will doubt you and risk your shot at the job you want?”

“On the other hand, if I am seeing what I consider severe long-term problems and say noth- ing now, in this report, and the problems show up later, will I be guilty of breaking a code of ethics?” Russell paused. “So, Christopher, what do I say tomorrow at the board meeting?”

QUESTIONS

1. What do you think Russell Hart should include in his report about Youssef Said? Why? What would you do in his position?

2. What amount or kind of courage will be required for Hart to disclose everything hon- estly? How would you advise Hart to acquire that courage?

3. At which stage of Kohlberg’s moral development scale would you place Youssef Said, Russell Hart, and Bill Andrews? Why?

Notes: *Descendant of the Prophet Muhammad

The Boy, the Girl, the Ferryboat Captain, and the Hermits There was an island, and on this island there lived a girl. A short distance away there was another island, and on this island there lived a boy. The boy and the girl were very much in love with each other.

The boy had to leave his island and go on a long journey, and he would be gone for a very long time. The girl felt that she must see the boy one more time before he went away.

190 PART 3 THE PERSONAL SIDE OF LEADERSHIP

There was only one way to get from the island where the girl lived to the boy’s island, and that was on a ferryboat that was run by a ferryboat captain. And so the girl went down to the dock and asked the ferryboat captain to take her to the island where the boy lived. The ferryboat captain agreed and asked her for the fare. The girl told the ferryboat captain that she did not have any money. The ferryboat captain told her that money was not necessary: “I will take you to the other island if you will stay with me tonight.”

The girl did not know what to do, so she went up into the hills on her island until she came to a hut where a hermit lived. We will call him the first hermit. She related the whole story to the hermit and asked for his advice. The hermit listened carefully to her story, and then told her, “I cannot tell you what to do. You must weigh the alternatives and the sacri- fices that are involved and come to a decision within your own heart.”

And so the girl went back down to the dock and accepted the ferryboat captain’s offer. The next day, when the girl arrived on the other island, the boy was waiting at the dock to greet her. They embraced, and then the boy asked her how she got over to his island, for he knew she did not have any money. The girl explained the ferryboat captain’s offer and what she did. The boy pushed her away from him and said, “We’re through. That’s the end. Go away from me. I never want to see you again,” and he left her.

The girl was desolate and confused. She went up into the hills of the boy’s island to a hut where a second hermit lived. She told the whole story to the second hermit and asked him what she should do. The hermit told her that there was nothing she could do, that she was welcome to stay in his hut, to partake of his food, and to rest on his bed while he went down into the town and begged for enough money to pay the girl’s fare back to her own island.

When the second hermit returned with the money for her, the girl asked him how she could repay him. The hermit answered, “You owe me nothing. We owe this to each other. I am only too happy to be of help.” And so the girl went back down to the dock and returned to her own island.

QUESTIONS

1. List in order the characters in this story that you like, from most to least. What values governed your choices?

2. Rate the characters on their level of moral development. Explain.

3. Evaluate each character’s level of courage. Discuss.

REFERENCES 1. Christine Roberts, “Malala Yousafzai Returns to School for First

Time since She Was Shot by the Taliban,” Daily News (March 19, 2013), http://www.thedailybeast.com/articles/2012/10/18/sisters -in-arms-young-afghan-activist-continues-malala-s-fight.html#body _text2 (accessed April 2, 2013); Alia E. Dastagir, “Pakistan Girl Shot by Taliban Seals Book Deal,” USA Today (March 28, 2013), http:// www.usatoday.com/story/news/world/2013/03/27/malala-pakistan -book-deal/2026697/ (accessed April 2, 2013); and “Young Journalist Inspires Fellow Students,” Institute for War and Peace Reporting (December 5, 2009), http://iwpr.net/report-news/young-journalist -inspires-fellow-students-0 (accessed April 2, 2013).

2. Roberts, “Malala Yousafzai Returns to School.”

3. Ben Worthen and Joann S. Lublin, “Mark Hurd Neglected to Follow H-P Code,” The Wall Street Journal (August 9, 2010), p. B1; Miguel Bustillo, “Best Buy Chairman to Resign After Probe,” The Wall Street Journal (May 15, 2012), http://online.wsj.com/article/SB1000142405270230 4192704577403922338506912.html (accessed April 3, 2013); and Amir Efrati and Joann S. Lublin, “Yahoo CEO’s Downfall,” The Wall Street Journal Online (May 15, 2012), http://online.wsj.com/article /SB10001424052702304192704577404530999458956.html (accessed July 2, 2012).

4. Anemona Hartocollis, “At Ailing Brooklyn Hospital, Insider Deals and Lavish Perks,” The New York Times (March 26, 2012), p. A1.

5. Chuck Salter, paraphrasing Bill George, former CEO of Medtronic, in “Mr. Inside Speaks Out,” Fast Company (September 2004), pp. 92–93.

6. Floyd Norris, “In Actions, S. & P. Risked Andersen’s Fate,” The New York Times (February 7, 2013), http://www.nytimes.com/2013/02/ 08/business/sp-may-have-tempted-arthur-andersens-fate.html?page wanted=all&_r=0 (accessed February 8, 2013).

7. Margaret Wheatley, “Fearless Leaders: We Need Them Here and Now,” Leadership Excellence (June 2010), pp. 5–6.

8. Roger Martin, “The CEO’s Ethical Dilemma in the Era of Earnings Management,” Strategy & Leadership 39, no. 6 (2011), pp. 43–47.

9. Quoted in David Wessel, “Venal Sins: Why the Bad Guys of the Boardroom Emerged en Masse,” The Wall Street Journal (June 20, 2002), pp. A1, A6.

10. Ronald W. Clement, “Just How Unethical Is American Business?” Business Horizons 49 (2006), pp. 313–327.

11. Gary R. Weaver, Linda Klebe Treviño, and Bradley Agle, “ ‘Somebody I Look Up To’: Ethical Role Models in Organizations,” Organiza- tional Dynamics 34, no. 4 (2005), pp. 313–330; Joseph L. Badaracco

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 191

Jr. and Allen P. Webb, “Business Ethics: A View from the Trenches,” California Management Review 37, no. 2 (Winter 1995), pp. 8–28; and Arlen W. Langvardt, “Ethical Leadership and the Dual Roles of Examples,” Business Horizons 55 (2012), pp. 373–384.

12. Michiko Kakutani, “The Tsunami That Buried a Wall Street Giant,” The New York Times (March 10, 2009), p. C4.

13. Ben DiPietro, “CEOs Emphasize Trust Is Anchor of a Strong Corporate Ethics Philosophy,” The Wall Street Journal Online (March 6, 2013), http://blogs.wsj.com/corruption-currents/2013/03 /06/ceos-emphasize-trust-is-anchor-of-a-strong-corporate-ethics- philosophy/ (accessed April 3, 2013); and Jennifer Schiavone, “Tip Sheet: A New Company Launch—from the Inside Out,” PR News (November 19, 2012), http://www.prnewsonline.com/featured /2012/11/19/tip-sheet-a-new-company-launchfrom-the-inside-out/ (accessed April 3, 2013).

14. This section is based on Donald G. Zauderer, “Integrity: An Essential Executive Quality,” Business Forum (Fall, 1992), pp. 12–16.

15. “New York’s Pension Scandal,” The New York Times (October 7, 2010), http://www.nytimes.com/2010/10/08/opinion/08fri2.html?_r=0 (accessed April 3, 2013); and “Review Shows NY Pension Fund Fixed Ethics,” The Wall Street Journal (February 19, 2013), http://online.wsj.com/article /APa0f276305f884319a004f97a2de34b8a.html (accessed April 3, 2013).

16. Patricia Wallington, “Honestly?!” CIO (March 15, 2003), pp. 41–42.

17. Langvardt, “Ethical Leadership and the Dual Roles of Examples”; Jeremy Roebuck and Amy Worden, “McQueary Affirms Report to Officials: Says He Told of Seeing ‘Severe Sexual Acts’ in the Showers,” Philadelphia Inquirer (December 17, 2011), p. A1; Jo Becker, “E-Mails Suggest Paterno Role in Silence on Sandusky,” The New York Times (July 1, 2012), http://www.nytimes.com/2012/07/01 /sports/ncaafootball/paterno-may-have-influenced-decision-not-to -report-sandusky-e-mails-indicate.html?_r=1&emc=eta1 (accessed July 9, 2012); Drew Sharp, “At Penn State, Football Bigger Than Principle,” Pittsburgh Post-Gazette (June 25, 2012), p. A8; and Alina Tugend, “Doing the Ethical Thing May Be Right, But It Isn’t Automatic,” The New York Times (November 18, 2011).

18. Langvardt, “Ethical Leadership and the Dual Roles of Examples.”

19. Carly Fiorina, “Corporate Leadership and the Crisis,” The Wall Street Journal (December 12, 2008), p. A19.

20. Al Gini, “Moral Leadership and Business Ethics,” The Journal of Leadership Studies 4, no. 4 (Fall 1997), pp. 64–81.

21. Henry Ford Sr., quoted by Thomas Donaldson, Corporations and Morality (Upper Saddle River, NJ: Prentice Hall, 1982), p. 57.

22. Michael E. Brown and Linda K. Treviño, “Ethical Leadership: A Review and Future Directions,” The Leadership Quarterly 17 (2006), pp. 595–616; Darin W. White and Emily Lean, “The Impact of Perceived Leader Integrity on Subordinates in a Work Team Environment,” Journal of Business Ethics 81 (2008), pp. 767–778; Gary R. Weaver, Linda K. Treviño, and Bradley Agle, “ ‘Somebody I Look Up To’: Ethical Role Models in Organizations,” Organizational Dynamics 34, no. 4 (2005), pp. 313–330; and Badaracco and Webb, “Business Ethics: A View from the Trenches.”

23. Joseph Weber, “The New Ethics Enforcers,” BusinessWeek (February 13, 2006), pp. 76–77.

24. More Than Wheels Mission and Core Values, http://www.morethanwheels .org/mission (accessed May 18, 2013).

25. Rashid Ameer and Radiah Othman, “Sustainability Practices and Corporate Financial Performance: A Study Based on the Top Global Corporations,” Journal of Business Ethics 108, no. 1 (June 2012), pp. 61–79.

26. Curtis C. Verschoor and Elizabeth A. Murphy, “The Financial Performance of Large U.S. Firms and Those with Global Prominence: How Do the Best Corporate Citizens Rate?” Business and Society Review 107, no. 3 (Fall 2002), pp. 371–381.

27. Phred Dvorak, “Finding the Best Measure of ‘Corporate Citizen- ship,’ ” The Wall Street Journal (July 2, 2007), p. B3.

28. Zauderer, “Integrity: An Essential Executive Quality.”

29. James M. Kouzes and Barry Z. Posner, Credibility: How Leaders Gain and Lose It, Why People Demand It (San Francisco: Jossey- Bass, 1993), p. 255.

30. Mary C. Gentile, “Combating Ethical Cynicism and Voicing Values in the Workplace,” Ivey Business Journal (May–June 2011), http://www .iveybusinessjournal.com/topics/leadership/combating-ethical-cynicism -and-voicing-values-in-the-workplace (accessed April 3, 2013).

31. Lawrence Kohlberg, “Moral Stages and Moralization: The Cognitive Developmental Approach,” in Thomas Likona, ed., Moral Development and Behavior: Theory, Research, and Social Issues (Austin, TX: Holt, Rinehart and Winston, 1976), pp. 31–53; Linda K. Treviño, Gary R. Weaver, and Scott J. Reynolds, “Behavioral Ethics in Organizations: A Review,” Journal of Management 32, no. 6 (December 2006), pp. 951–990; Jill W. Graham, “Leadership, Moral Development, and Citizenship Behavior,” Business Ethics Quarterly 5, no. 1 (January 1995), pp. 43–54; James Weber, “Exploring the Relationship between Personal Values and Moral Reasoning,” Human Relations 46, no. 4 (April 1993), pp. 435–463; and Duane M. Covrig, “The Organizational Context of Moral Dilemmas: The Role of Moral Leadership in Administration in Making and Breaking Dilemmas,” The Journal of Leadership Studies 7, no. 1 (2000), pp. 40–59.

32. Vivian Yee, “Stuyvesant Students Describe the How and the Why of Cheating,” The New York Times (September 25, 2012), http://www .nytimes.com/2012/09/26/education/stuyvesant-high-school-students -describe-rationale-for-cheating.html?pagewanted=all (accessed April 3, 2013).

33. Quoted in Richard Pérez-Peña, “Studies Find More Students Cheating, with High Achievers No Exception,” The New York Times (September 7, 2010), http://www.nytimes.com/2012/09/08 /education/studies-show-more-students-cheat-even-high-achievers .html (accessed April 3, 2013).

34. Anthony F. Buono et al., “Acting Ethically: Moral Reasoning and Business School Student Behavior,” SAM Advanced Management Journal (Summer 2012), pp. 18–26.

35. J. R. Rest, D. Narvaez, M. J. Bebeau, and S. J. Thoma, Postconven- tional Moral Thinking: A Neo-Kohlbergian Approach (Mahwah, NJ: Lawrence Erlbaum, 1999).

36. James Weber, “Exploring the Relationship between Personal Values and Moral Reasoning,” Human Relations 46, no. 4 (April 1993), pp. 435–463.

37. White and Lean, “The Impact of Perceived Leader Integrity on Subordinates in a Work Team Environment”; Peter Block, “Reassign- ing Responsibility,” Sky (February 1994), pp. 26–31; and David P. McCaffrey, Sue R. Faerman, and David W. Hart, “The Appeal and Difficulty of Participative Systems,” Organization Science 6, no. 6 (November–December 1995), pp. 603–627.

38. Block, “Reassigning Responsibility.”

39. This discussion of stewardship is based on Peter Block, Stewardship: Choosing Service over Self-Interest (San Francisco: Berrett-Koehler, 1993), pp. 29–31; Block, “Reassigning Responsibility”; Morela Hernandez, “Promoting Stewardship Behavior in Organizations: A Leadership Model,” Journal of Business Ethics 80, no. 1 (June 2008), pp. 121–128; Morela Hernandez, “Toward an Understanding of the Psychology of Stewardship,” Academy of Management Review 37, no. 2 (2012), pp. 172–193; and Gary Hamel, “Leaders as Stewards: What Matters Are Bedrock Values,” Leadership Excellence (August 2012), p. 5.

40. Martin Edwards, “Workforce Engagement: Case Study of an Award- Winning Leadership Model,” Industrial and Commercial Training 44, no. 3 (2012), pp. 132–138.

192 PART 3 THE PERSONAL SIDE OF LEADERSHIP

41. Lawrence G. Foster, Robert Wood Johnson—The Gentleman Rebel (Lemont, PA: Lillian Press, 1999); and John Cunniff, “Businessman’s Honesty, Integrity Lesson for Today,” Johnson City Press (May 28, 2000).

42. Adam Bluestein, “Start a Company. Change the World.” Inc. (May 2011), pp. 71–80.

43. Sen Sendjaya and James C. Sarros, “Servant Leadership: Its Origin, Development, and Application in Organizations,” Journal of Leader- ship and Organizational Studies 9, no. 2 (2002), pp. 57–64. Examples include B. M. Bass, “The Future of Leadership in Learning Organizations,” The Journal of Leadership Studies 7, no. 3 (2000), pp. 18–40; I. H. Buchen, “Servant Leadership: A Model for Future Faculty and Future Institutions,” The Journal of Leadership Studies 5, no. 1 (1998), pp. 125–134; Y. Choi and R. R. Mai-Dalton, “On the Leadership Function of Self-Sacrifice,” Leadership Quarterly 9, no. 4 (1998), pp. 475–501; and R. F. Russell, “The Role of Values in Servant Leadership,” Leadership and Organizational Development Journal 22, no. 2 (2001), pp. 76–83.

44. Robert K. Greenleaf, Servant Leadership: A Journey into the Nature of Legitimate Power and Greatness (Mahwah, NJ: Paulist Press, 1977).

45. The following is based on Greenleaf, Servant Leadership; Walter Kiechel III, “The Leader as Servant,” Fortune (May 4, 1992), pp. 121–122; and Mary Sue Polleys, “One University’s Response to the Anti-Leadership Vaccine: Developing Servant Leaders,” The Journal of Leadership Studies 8, no. 3 (2002), pp. 117–130.

46. Sendjaya and Sarros, “Servant Leadership: Its Origin, Development, and Application in Organizations.”

47. Susan Dominus, “Is Giving the Secret to Getting Ahead?” The New York Times Magazine (March 27, 2013). http://www.nytimes.com /2013/03/31/magazine/is-giving-the-secret-to-getting-ahead.html? pagewanted=all&_r=0 (accessed April 4, 2013).

48. C. William Pollard, “The Leader Who Serves,” in Frances Hesselbein, Marshall Goldsmith, and Richard Beckhard, eds., The Leader of the Future (San Francisco: Jossey-Bass, 1996), pp. 241–248; and C. W. Pollard, “The Leader Who Serves,” Strategy and Leadership (September–October 1997), pp. 49–51.

49. Peter Voyer, “Courage in Leadership: From the Battlefield to the Boardroom,” Ivey Business Journal (November–December 2011), http://www.iveybusinessjournal.com/topics/leadership/courage-in -leadership-from-the-battlefie ld-to-the-boardroom (accessed November 24, 2011).

50. John McCain, “In Search of Courage,” Fast Company (September 2004), pp. 53–56.

51. Richard L. Daft and Robert H. Lengel, Fusion Leadership: Unlocking the Subtle Forces That Change People and Organizations (San Francisco: Berrett-Koehler, 1998).

52. The F.E.A.R. acronym and the quote are from Brian Clark, “Is F.E.A.R. Holding You Back?” Copyblogger.com (May 28, 2010), http://www.copyblogger.com/f-e-a-r/ (accessed May 19, 2011).

53. Dominus, “Is Giving the Secret to Getting Ahead?”

54. Brian Moriarty and R. Edward Freeman, “Case in Point: To Go from Worst to First, Alter the Business Model,” The Washington Post (December 10, 2011), http://articles.washingtonpost.com/2011 -12-10 /bus iness/35286296_ 1_ a etna -employ ees-john-w-rowe -business-model (accessed December 11, 2011).

55. Carol D. Leonnig and David Nakamura, “Official Quickly Corralled Agents,” The Washington Post (April 22, 2012), p. A1; David Nakamura, “Out of Public Eye, a Disgusted Secret Service Director,” The Washington Post (April 26, 2012), p. A1; Carol D. Leonnig and David Nakamura, “Four in Secret Service Fight Back,” The

Washington Post (May 23, 2012), p. A1; and William Neuman, “Prostitutes Perplexed as Glare Falls on City’s Brothels,” The New York Times (April 25, 2012), http://www.nytimes.com/2012/04 /26/world/americas/cartagenas-prostitutes-perplexed-by-global-glare .html?_r=0 (accessed April 6, 2013).

56. Michael Luo, “Revisiting a Social Experiment, and the Fear That Goes with It,” The New York Times (September 14, 2004), Section B, p. 1.

57. Jerry B. Harvey, The Abilene Paradox and Other Meditations on Management (Lexington, MA: Lexington Books, 1988), pp. 13–15.

58. Simon Denyer, “Incorruptible Indian Bureaucrat Hounded Out of Office for Fighting Graft—43 Times,” The Washington Post (October 22, 2012), http://articles.washingtonpost.com/2012-10-22 /world/3 55 009 68_1_asho k-kh emka-vadra-case-robert-vad ra (accessed October 23, 2012).

59. A. J. Vogl, “Risky Work” (an interview with Max DuPree), Across the Board (July/August 1993), pp. 27–31.

60. William H. Peace, “The Hard Work of Being a Soft Manager,” Harvard Business Review (November–December 1991), pp. 40–47.

61. Janet P. Near and Marcia P. Miceli, “Effective Whistle-Blowing,” Academy of Management Review 20, no. 3 (1995), pp. 679–708.

62. James Risen, “Army Overseer Tells of Ouster over KBR Stir,” The New York Times (June 17, 2008), http://www.nytimes.com/2008/06 /17/washington/17contractor.html?pagewanted=all&_r=0 (accessed April 8, 2013); and John Baldoni, “Putting Courage into Action for Others and Yourself,” Leader to Leader (Winter 2011), pp. 24–26.

63. Robert Jeffery, “Whistleblowers: ‘Suddenly I Was the Lead in a John Grisham Novel’: How Michael Woodford, The CEO Who Exposed the Olympus Fraud, Gambled His Career on Doing the Right Thing,” People Management (November 2012), pp. 28–29.

64. Ibid.

65. Risen, “Army Overseer Tells of Ouster.”

66. Alyse Walsh, “Sisters in Arms: Young Afghan Activist Continues Malala’s Fight,” The Daily Beast (October 18, 2012), http://www .thedailybeast.com/articles/2012/10/18/sisters-in-arms-young-afghan -activist-continues-malala-s-fight.html (accessed April 8, 2013).

67. Discussed in Malcolm Gladwell, “Small Change: Why the Revolution Will Not Be Tweeted,” The New Yorker (October 4, 2010), http:// www.newyorker.com/reporting/2010/10/04/101004fa_fact_gladwell (accessed April 8, 2013).

68. James M. Kouzes and Barry Z. Posner, The Leadership Challenge: How to Get Extraordinary Things Done in Organizations (San Francisco: Jossey-Bass, 1988).

69. Gladwell, “Small Change: Why the Revolution Will Not Be Tweeted”; and Wheatley, “Fearless Leaders.”

70. Peggy Payne, “How Insults Spur Success,” The New York Times (October 15, 2011), http://www.nytimes.com/2011/10/16/jobs/16pre .html?_r=0 (accessed April 8, 2013).

71. Michael Warshaw, ed., “Great Comebacks,” Success (July/August 1995), pp. 33–46.

72. Ira Chaleff, The Courageous Follower: Standing Up to and for Our Leaders (San Francisco: Berrett-Koehler, 1995).

73. This section is based on Kathleen K. Reardon, “Courage as a Skill,” Harvard Business Review (January 2007), pp. 58–64; Mary C. Gentile, “Managing Yourself: Keeping Your Colleagues Honest,” Harvard Business Review (March 2010), pp. 114–117; and Wheatley, “Fearless Leaders.”

74. Based on Wheatley, “Fearless Leaders”; and Gentile, “Managing Yourself: Keeping Your Colleagues Honest” (example reported in Gentile).

CHAPTER 6 COURAGE AND MORAL LEADERSHIP 193

Chapter 7: Followership

Jo rd an

Ly e/ Fl ic kr O pe n/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Effectively manage both up and down the hierarchy. • Recognize your followership style and take steps to become a more effective follower. • Understand the leader’s role in developing effective followers. • Apply the principles of effective followership, including responsibility, service, challenging authority,

participating in change, and knowing when to leave.

• Implement the strategies for effective followership at school or work. • Know what followers want from leaders and what leaders expect from followers. • Use feedback and leadership coaching to help followers grow and achieve their potential.

CHAPTER OUTLINE 196 The Art of Followership

198 What Your Leader Wants from You

199 Styles of Followership

202 Strategies for Managing Up

208 The Power and Courage to Manage Up

211 What Followers Want from Leaders

In the Lead

197 Irvin D. Yalom and Marcia Reynolds

202 Dawn Marshall, Pathmark

206 John Stroup, Belden Inc.

210 Laurie Stein, Clorox

Leader’s Self-Insight

201 The Power of Followership

204 Are You an Annoying Follower?

214 Ready for Coaching

Leader’s Bookshelf

207 Good Boss, Bad Boss: How to Be the Best and Learn from the Worst

Leadership at Work

216 Follower Role Play

Leadership Development: Cases for Analysis

217 Waiting for Clearance

218 Jake’s Pet Land

I rving Christopher and Angela Navarro are standing on a cliff looking out over the ocean. It’s been a great two days, learning about how to be a better leader in today’s multicultural, social media-crazy workplace. Now the seminar is over

and the two middle managers are taking a stroll along the cliff before driving home and returning to their regular work after the weekend. “You know,” says Christopher, “this has all been enlightening, but I have such good subordinates that if I decided to jump off this cliff they would jump with me.” Navarro hesitates, then says, “I don’t know if I’d say they’re so good, Irv. If members of my team saw me about to go over this cliff, they would stop me and tell me why I shouldn’t do it!”1

Which leader do you say has the best followers? Some experts on leadership and followership would say that neither model reflects highly effective followers. Sure, blindly following your leader in jumping off a cliff isn’t a good idea, but leaders want followers who will not try to stop them from taking risks and pursuing difficult challenges that are in the best interest of the organization. The best followers see where the leader wants to go and why, and then help find the best way to get there quickly, safely, and effectively.2

In this chapter, we examine the important role of followership, including the nature of the follower’s role, what leaders want from followers, and the different

195 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

styles of followership that individuals express. The chapter explores how effective followers behave, discusses strategies for managing up, and looks at the sources of power and courage for managing up. Finally, we look at what followers want from leaders and examine the leader’s role in developing and supporting followers.

THE ART OF FOLLOWERSHIP Leadership and followership are closely intertwined. Considering leadership the sole basis for success of the organization is a flawed assumption, and it limits the opportu- nity for people throughout the organization to accept responsibility and make active, valuable contributions.3 For any group or organization to succeed, there must be peo- ple who willingly and effectively follow just as there must be those who willingly and effectively lead. Followership is the testing ground, a place to learn skills valuable for leadership. Moreover, leadership and followership are fundamental roles that indivi- duals shift into and out of under various conditions. Everyone—leaders included—is a follower at one time or another. Indeed, despite the focus on leadership, most of us are more often followers than leaders.4 Therefore, it is important for people to learn to manage both up and down the hierarchy, as illustrated in Exhibit 7.1

Learn to Manage Up as Well as Down Managing up means consciously and deliberately developing a meaningful, task- related, mutually respectful relationship with your direct superiors; offering insight, information, guidance, and initiative; and challenging your superiors when neces- sary in order to enable all members to do their best work for the organization.5

EXHIBIT 7.1 Good Leaders Manage Both Up and Down the Hierarchy

Source: Based on Mark Hurwitz and Samantha Hurwitz, “The Romance of the Follower: Part 2,” Industrial and Commercial Training 41, no. 4 (2009), pp. 199–206.

Managing up consciously and deliberately developing a meaningful, task-related, mutually respectful relationship with your direct superiors

196 PART 3 THE PERSONAL SIDE OF LEADERSHIP

People who effectively manage both up and down the hierarchy are more success- ful. Leaders at higher organizational levels depend on their subordinates for infor- mation, support, and assistance in accomplishing the organization’s goals, so your boss needs you to manage up. In addition, your subordinates depend on you to help them get the information, resources, support, and recognition they need and deserve from higher levels. People like working for leaders who have influence with their superiors because it enhances their own status in the organization and helps them get what they need to do their jobs well.6 You can’t be a really good leader unless you manage the boss as skillfully as you manage employees.

Managing Up Presents Unique Challenges Many new leaders are uncomfortable with the idea of managing their boss. Their over- riding concern is pleasing the boss and keeping him or her happy. Therefore, they hesi- tate to pass along any information that might not be welcome, and they avoid questioning any of their superior’s assumptions, ideas, or decisions.7 In the long run, these self-protective strategies hurt the employee, the boss, and the organization.

One reason we may have difficulty managing upward is that we’re not “in con- trol” in this relationship as we are in our relationships with subordinates. It is nat- ural that we try to protect ourselves in a relationship where we feel we have little control and little power.8 Yet in reality we have more power than we know. Bosses need our support—our talent, information, ideas, and honesty—in order to do their jobs well, just as we need their support to do our best work. Everyone benefits when leaders learn to effectively manage relationships with superiors as well as sub- ordinates. Consider the following examples.

IN THE LEAD Irvin D. Yalom and Marcia Reynolds Psychology professor Irvin D. Yalom has some interesting stories from his counseling experi- ence with clients in individual and group therapy. One woman ranted at length in a group therapy session about her boss, who never listened and refused to pay her any respect. There’s nothing funny about a bad boss, but the interesting thing about this client was that as her work with Yalom continued, her complaints about her terrible boss persisted through three different jobs with three different supervisors. It is likely that not only she but also her supervisors, colleagues, and the companies where she worked suffered due to her unproductive relationships with her superiors.

Contrast this woman’s attitude and approach to that of Marcia Reynolds, who once worked for a micromanaging boss who was always criticizing and correcting her work. Rey- nolds decided to stop resenting his micromanaging and instead “act as though he were the world’s best boss with the world’s best employee.” Instead of complaining and pushing back when her boss micromanaged, Reynolds was cheerful and helpful. She says an interesting thing happened: “When I stopped resisting, he started trusting me. When there was no longer any resistance, he quit fighting. Doing that really empowered me.” As her boss increasingly trusted Reynolds, his micromanaging continued to abate, their relationship continued to improve, and both were happier and more productive. Reynolds was able to better do her job and get her subordinates what they needed by learning to manage up.9

CHAPTER 7 FOLLOWERSHIP 197

Marcia Reynolds improved her relationship with her boss by understanding that being supportive and helpful was more productive than being resentful. To effectively manage up requires understanding what leaders want and need.

WHAT YOUR LEADER WANTS FROM YOU Leaders and organizational situations vary, but there are some qualities and behaviors that every good leader wants from his or her followers. The following are ones that have been shown to contribute to productive and rewarding leader–follower relationships.10

1. A Make-It-Happen Attitude. Leaders don’t want excuses. They want results. A leader’s job becomes smoother when he or she has followers who are positive and self-motivated, who can get things done, who accept responsibility, and who excel at required tasks. Leaders value those people who propose ideas, show initiative, and take responsibility when they see something that needs to be done or a problem that needs to be solved. For example, when the night jan- itor at FAVI, a French copper-alloy foundry, was cleaning one night, the phone rang and she answered it to discover that an important visitor to the company had been delayed and was now waiting at the airport without the promised ride to his hotel. (FAVI’s CEO had left the airport when the visitor didn’t arrive as expected.) The janitor took the keys to one of the company cars, drove 90 min- utes to pick up the visitor and deliver him to his hotel, then went back to finish the cleaning she had interrupted three hours earlier. Although this was nowhere close to being within her official job duties, the employee knew that leaders in the company valued and rewarded people who had the gumption to take responsibility for getting things done.11

2. A Willingness to Collaborate. Leaders are responsible for much more in the organization than any individual follower’s concerns, feelings, and perfor- mance. Each follower is a part of the leader’s larger system and should realize that his or her actions affect the whole. Larry Bossidy, former chairman and CEO of AlliedSignal and of Honeywell, tells about a conflict between the heads of manufacturing and marketing at one organization The two managers didn’t communicate with one another, so inventories were always out of whack. The CEO finally had to fire them both because their refusal to cooperate was hurt- ing the organization. They got their jobs back when they jointly called and said they got the point and would change their behavior.12

3. The Motivation to Stay Up-to-Date. Bosses want followers to know what is hap- pening in the organization’s industry or field of endeavor. In addition, they want people to understand their customers, their competition, and how changes in tech- nology or world events might affect the organization. Most people try to learn all they can in order to get a job, but they sometimes grow complacent and fail to stay current with what’s going on outside the narrow confines of their day-to-day work.

4. The Passion to Drive Your Own Growth. Similarly, leaders want followers who seek to enhance their own growth and development rather than depending solely on the leader to do it. Anything that exposes an individual to new people and ideas can enhance personal and professional development. One example is when followers actively network with others inside and outside the organiza- tion. Another is when followers take on difficult assignments, which demon- strates a willingness to face challenges, stretch their limits, and learn.

198 PART 3 THE PERSONAL SIDE OF LEADERSHIP

STYLES OF FOLLOWERSHIP Despite the importance of followership and the crucial role that followers play in the success of any endeavor, research on the topic is limited. One theory of follow- ership was proposed by Robert E. Kelley, who conducted extensive interviews with leaders and followers and came up with five styles of followership.13 These follow- ership styles are categorized according to two dimensions. The first dimension is the quality of independent, critical thinking versus dependent, uncritical thinking. Critical thinking means approaching subjects, situations, and problems with thoughtful questions and in an unbiased way, gathering and assessing ideas and information objectively, and mentally penetrating into underlying implications of various alter- natives. This recalls our discussion of mindfulness in Chapter 5; independent critical thinkers are mindful of the effects of their and other people’s behavior on achieving organizational goals. They are aware of the significance of their own actions and the actions of others. They can weigh the impact of decisions on the vision set forth by a leader and offer constructive criticism, creativity, and innovation. Con- versely, a dependent, uncritical thinker does not consider possibilities beyond what he or she is told, does not contribute to the cultivation of the organization, and accepts the leader’s ideas without assessing or evaluating them.

According to Kelley, the second dimension of followership style is active versus passive behavior. An active individual participates fully in the organization, engages in behavior that is beyond the limits of the job, demonstrates a sense of ownership, and initiates problem solving and decision making. A passive individual is charac- terized by a need for constant supervision and prodding by superiors. Passivity is often regarded as laziness; a passive person does nothing that is not required and avoids added responsibility.

The extent to which one is active or passive and is a critical, independent thinker or a dependent, uncritical thinker determines whether he or she is an alienated fol- lower, a passive follower, a conformist, a pragmatic survivor, or an effective follower, as shown in Exhibit 7.2.

The alienated follower is an independent, critical thinker but is passive in the organization. Alienated followers are often effective followers who have experi- enced setbacks and obstacles, perhaps promises broken by superiors. Thus, they are capable, but they focus exclusively on the shortcomings of the organization and other people. Often cynical, alienated followers are able to think independently, but they do not participate in developing solutions to the problems or deficiencies they see. For example, Barry Paris spent more than 10 years writing on and off for

EXHIBIT 7.2 Followership Styles

Follower Type Thinking Style Level of Engagement

Alienated Follower Independent, critical thinker Passive in the organization

Conformist Dependent, uncritical thinker Active in the organization

Pragmatic Survivor Both as needed Both as needed

Passive Follower Dependent, uncritical thinker Passive in the organization

Effective Follower Independent, critical thinker Active in the organization

Source: Based on information in Robert E. Kelley, The Power of Followership (New York: Doubleday,1992)

Critical thinking thinking independently and being mindful of the effects of one’s own and other people’s behavior on achieving the organization’s vision

Uncritical thinking failing to consider possibili- ties beyond what one is told; accepting the leader’s ideas without thinking

Alienated follower a person who is an inde- pendent, critical thinker but is passive in the organization.

CHAPTER 7 FOLLOWERSHIP 199

the Pittsburgh Post-Gazette, where he was known for his bad attitude and lack of enthusiasm and teamwork. Eventually Paris realized that he wasted that time rumi- nating over what he perceived as the hypocrisy of journalistic objectivity. “I could never resign myself to it,” says Paris. Thus, rather than doing his best and trying to help others maintain standards of integrity and objectivity, he allowed hostility and cynicism to permeate his work.14

The conformist participates actively in the organization but does not utilize criti- cal thinking skills in his or her task behavior. In other words, a conformist typically carries out any and all orders regardless of the nature of those tasks. The conformist participates willingly but without considering the consequences of what he or she is being asked to do—even at the risk of contributing to a harmful endeavor. For exam- ple, the thousands of people who have lost their homes to foreclosure can blame not only top executives in firms like Countrywide, Fannie Mae, and IndyMac Bank who embraced the rampant sale of subprime mortgages (sometimes called liars’ loans) but also many conformist managers and employees who blindly went along with the strategy. In his book The Foreclosure of America, former Countrywide executive Adam Michaelson writes of the groupthink and blind conformity that squelched resistance and led people to go along with company actions even if they thought they were wrong.15 A conformist is concerned only with avoiding conflict. This style often results from rigid rules and authoritarian environments in which leaders per- ceive subordinate recommendations as a challenge or threat.16

The pragmatic survivor has qualities of all four extremes—depending on which style fits with the prevalent situation. This type of follower uses whatever style best benefits his or her own position and minimizes risk. Within any given company, some 25 to 35 percent of followers tend to be pragmatic survivors, avoiding risks and foster- ing the status quo, often for political reasons. Government appointees often demon- strate this followership style because they have their own agendas and a short period of time in which to implement them. They may appeal to the necessary individuals, who themselves have a limited time to accomplish goals and are therefore willing to do whatever is necessary to survive in the short run. Pragmatic survivors also may emerge when an organization is going through desperate times, and followers find themselves doing whatever is needed to get themselves through the difficulty.17

The passive follower exhibits neither critical, independent thinking nor active participation. Being passive and uncritical, these followers display neither initiative nor a sense of responsibility. Their activity is limited to what they are told to do, and they accomplish things only with a great deal of supervision. The assistant manager at one large hotel found herself having to supervise her boss’s daughter, who failed to follow procedures, had to be told over and over when and how to perform tasks, and showed little interest in the job, reflecting the characteristics of a passive follower.18 Passive followers leave the thinking to their leaders. Some- times, however, this style is the result of a leader who expects and encourages pas- sive behavior. Followers learn that to show initiative, accept responsibility, or think creatively is not rewarded and may even be punished by the leader, so they grow increasingly passive. Passive followers are often the result of leaders who are over- controlling of others and who punish mistakes.19

The effective follower is both a critical, independent thinker and active in the organization. Effective followers behave the same toward everyone regardless of their positions in the organization. They do not try to avoid risk or conflict. Rather, effective followers have the courage to initiate change and put themselves at risk or in conflict with others, even their leaders, to serve the best interest of the organization.

NEW LEADER ACTION MEMO Complete the questionnaire in Leader’s Self-Insight 7.1 to evaluate how well you carry out a followership role.

Conformist a follower who participates actively in the organization but does not utilize critical thinking skills in his or her task behavior

Pragmatic survivor a follower who has qualities of all four extremes (alien- ated, effective, passive, con- formist), depending on which style fits with the prevalent situation

Passive follower a person in an organization who exhibits neither critical, independent thinking nor active participation

Effective follower a critical, independent thinker who actively partici- pates in the organization

200 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Characterized by both mindfulness and a willingness to act, effective followers are essential for an organization to be effective. They are capable of self- management, discern strengths and weaknesses in themselves and in the organization, are committed to something bigger than themselves, and work toward competency, solutions, and a positive impact. Dawn Marshall, a cashier at Pathmark, illustrates the characteristics of the effective follower.

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 7.1

The Power of Followership

Instructions: For each of the following statements, think of a specific situation in which you worked for a boss in an organization. Then answer whether each item is Mostly False or Mostly True for you in that follower situation.

Mostly False

Mostly True

1. I often commented to my manager on the broader impor- tance of data or events.

2. I thought carefully and then expressed my opinion about critical issues.

3. I frequently suggested ways of improving my and others’ ways of doing things.

4. I challenged my manager to think about an old problem in a new way.

5. Rather than wait to be told, I would figure out the critical activ- ities for achieving my unit’s goals.

6. I independently thought up and championed new ideas to my boss.

7. I tried to solve the tough pro- blems rather than expect my leader to do it.

8. I played devil’s advocate if needed to demonstrate the up- side and downside of initiatives.

9. My work fulfilled a higher personal goal for me.

10. I was enthusiastic about my job. 11. I understood my leader’s

goals and worked hard to meet them.

12. The work I did was significant to me.

13. I felt emotionally engaged throughout a typical day.

14. I had the opportunity to do what I do best each day.

15. I understood how my role contributed to the company’s success.

16. I was willing to put in a great deal of effort beyond what was normally expected.

Scoring and Interpretation Questions 1–8 measure independent thinking. Sum the number of Mostly True answers checked and write your score below.

Questions 9–16 measure active engagement. Sum the number of Mostly True answers checked and write your score below.

Independent Thinking Total Score Active Engagement Total Score These two scores indicate how you carried out your

followership role. A score of 2 or below is considered low. A score of 6 or higher is considered high. A score of 3–5 is in the middle. Based on whether your score is high, middle, or low, assess your followership style below.

Followership Style

Independent Thinking Score

Active Engagement Score

Effective High High Alienated High Low Conformist Low High Pragmatist Middle Middle Passive Low Low

How do you feel about your followership style? Compare your style with that of others in your class. What might you do to be more effective as a follower?

Sources: Based on Douglas R. May, Richard L. Gilson, and Lynn M. Harter, “The Psychological Conditions of Meaningfulness, Safety, and Availability and the Engagement of the Human Spirit at Work,” Journal of Occupa- tional and Organizational Psychology 77 (March 2004), pp. 11–38; Robert E. Kelley, The Power of Followership: How to Create Leaders People Want to Follow and Followers Who Lead Themselves (New York: Doubleday, 1992); and Towers Perrin HR Services, “Working Today: Understanding What Drives Employee Engagement,” (2003), www.towersperrin.com.

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IN THE LEAD Dawn Marshall, Pathmark Five hours into her shift, four harried customers line up at Dawn Marshall’s cash register at the Pathmark supermarket in Upper Derby, Pennsylvania. Eight minutes and 27 bags later, they’re all out the door with smiles on their faces. Few people would think Marshall has a glamorous or influential job—but she treats it like the most significant job in the world.

Marshall specializes in giving people a little bit of luxury in the mundane chore of gro- cery shopping. She’s a good cashier, but her forte is bagging. Marshall knows how to pack the flimsy plastic bags so that eggs don’t get broken, bread doesn’t get squashed, and ground beef doesn’t leak all over the cereal boxes. She even won a National Grocers Associ- ation contest as the best bagger in America, based on speed, bag-building technique, style, and attitude. “I believe it’s an art that should be taken seriously,” Marshall says of her work. Many Pathmark customers agree. They’re tired of cashiers and baggers who simply throw the stuff in bags without giving a care for the customer’s convenience or needs. One cus- tomer admits that she shops at Pathmark rather than a store closer to her home because of Marshall. “I like her attitude,” says the customer. “Clone her.”

Even though Marshall works on her feet all day and often has to put up with rude or insen- sitive customers, she handles whatever comes her way with a positive attitude. For Marshall, her job is not bagging groceries but making people’s lives easier. Thus, she approaches her work with energy and enthusiasm, striving to do her best in every encounter. She doesn’t need close super- vision or someone pushing her to work harder. The busier it is, the better she likes it.20

Dawn Marshall has taken what some would consider a boring, low-paying job and imbued it with meaning and value. She accepts responsibility for her own per- sonal fulfillment and finds ways to expand her potential and use her capacities to serve the needs of others and the organization. Effective followers like Dawn Marshall also act as leaders by setting an example and using a positive attitude to inspire and uplift other people.

Effective followers are far from powerless—and they know it. Therefore, they do not despair in their positions, nor do they resent or manipulate others. This chapter’s Consider This describes one writer’s meaning of effective followership.

STRATEGIES FOR MANAGING UP There is growing recognition that how followers manage their leaders is just as important as how their leaders manage them.21 Two aspects of managing up are understanding the leader and using specific tactics to improve the leader–follower relationship.

Understand the Leader We all spend time and energy trying to understand people who are important to us, so it only makes sense that you do the same with your boss if you want to have a productive working relationship. It is up to you to take the initiative to learn about your leader’s goals, needs, strengths and weaknesses, and organizational constraints.

NEW LEADER ACTION MEMO As a leader, you can also be an effective follower. You can think independently and critically in- stead of blindly accepting what your superiors tell you. Rather than dwelling on the short- comings of others, you can look for solutions.

202 PART 3 THE PERSONAL SIDE OF LEADERSHIP

In addition, effective followers study their leader’s preferred work style. No two individuals work alike or behave alike under the same circumstances. Effective fol- lowers learn their leader’s preferences and adapt to them. Interviews with senior executives confirm that this strategy is both effective and appropriate for influenc- ing the leader–follower relationship.22 You can pay close attention to the leader’s behavior in the following areas to know how to be a more effective follower:23

• Does the leader like to know all the details of your plans, projects, and pro- blems, or does she just want the big picture?

• Is the leader controlling or empowering? Does he want to closely supervise and be in control of people’s behavior or delegate freely and look for opportunities to help individuals grow and develop to their highest potential?

• Does the leader like to carefully analyze information and alternatives before mak- ing a decision, or is she more inclined to make quick decisions and take action?

• Is the leader a reader or a listener? Does he like to have materials presented in written form so he has time to study and analyze them by himself first, or does he prefer an oral presentation where he can ask questions on the spot?

• Is she a numbers person or a word person? Does she want statistics and figures to back up your report or request?

• Is the leader an extrovert or an introvert? Do interactions with large groups of people energize or tire him? Does he like to be involved with people all day or need time alone to think and recharge?

Effective followers seek out all the information they can about their leader from talking to the boss, talking to others, and paying attention to clues in the leader’s behavior, so that they are sensitive to the leader’s work style and needs. For example,

Consider Our Deepest Fear

Our deepest fear is not that we are inadequate, Our deepest fear is that we are powerful beyond measure.

It is our light, not our darkness, that most frightens us. We ask ourselves, who am I to be brilliant, gorgeous, talented and fabulous? Actually, who are you NOT to be? You are a child of God. Your playing small doesn’t serve the world. There’s nothing enlightened about shrinking so that other people won’t feel insecure

around you. We were born to make manifest the glory … that is within us. It’s not just in some of us; it’s in everyone. And as we let our own light shine, we unconsciously give other people permission to do

the same. As we are liberated from our own fear, our presence automatically liberates others.

Source: From A Return to Love: Reflections on the Principles of a Course in Miracles, by Marianne Williamson, pub- lished by HarperCollins.

CHAPTER 7 FOLLOWERSHIP 203

people working with U.S. president Barack Obama have learned that he is an intro- vert who likes to have time to reflect. He prefers to have decision memos, briefing materials, and other items in writing so he can carefully study them and think of questions he wants to ask. Obama likes to consider a lot of information and a variety of opinions before he acts. President George W. Bush, on the other hand, was an extrovert who preferred oral briefings and relatively quick decisions.24

Tactics for Managing Up Most followers at some point complain about the leader’s deficiencies, such as a failure to listen, to encourage, or to recognize followers’ efforts.25 Sometimes, though, we need to look in the mirror before blaming our leaders for an unsatisfy- ing or unproductive relationship. To be effective, followers develop a meaningful,

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 7.2

Are You an Annoying Follower?

1. If you think there might be a mistake in something you’ve done, what do you do? A. Fess up. It’s better to share your concerns up front so

your boss can see if there is a problem and get it corrected before it makes him look bad.

B. Try to hide it for now. Maybe there isn’t really a problem, so there’s no use in making yourself look incompetent.

2. How do you handle a criticism from your boss? A. Poke your head in her door or corner her in the caf-

eteria multiple times to make sure everything is okay between the two of you.

B. Take the constructive criticism, make sure you understand what the boss wants from you, and get on with your job.

3. You’re in a crowded elevator with your boss after an important meeting where you’ve just landed a million- dollar deal. You: A. Celebrate the victory by talking to your boss about

the accomplishment and the details of the meeting. B. Keep your mouth shut or talk about non-business-

related matters. 4. Your boss has an open-door policy and wants people to

feel free to drop by her office any time to talk about anything. You pop in just after lunch and find her on the phone. What do you do? A. Leave and come back later. B. Wait. You know most of her phone calls are quick, so

she’ll be free in a few minutes. 5. You’ve been called to the boss’s office and have no idea

what he wants to talk about. A. You show up on time, empty-handed, to concentrate

on what the boss has to say. B. You show up on time with a pen, paper, and your

calendar or mobile device.

6. You’ve been trying to get some face time with your boss for weeks and luckily catch him or her in the bathroom. You: A. Take care of personal business and get out of there. B. Grab your chance to schmooze with the boss. Ask a

question or tell a joke. You might not get another chance any time soon.

Here are the appropriate follower behaviors.

1. A. Honest self-assessment and fessing up to the boss builds mutual confidence and respect. Nothing destroys trust faster than incompetence exposed after the fact.

2. B. David Snow, former president and COO of Empire Blue Cross and Blue Shield, refers to insecure, thin-skinned peo- ple who have to check in frequently after a criticism as door swingers. Door swingers are annoying in both our personal and work lives. Just get on with things.

3. B. You have no idea who else is in the elevator. Keep your mouth shut. You can crow about the new deal later in private.

4. A. There’s nothing worse than having someone hovering while you’re trying to carry on a phone conversation. Leave a note with your boss’s assistant or come back later.

5. B. You can usually be safe in assuming your boss hasn’t called you in for idle chitchat. Never show up without a pen and paper or tablet to make notes.

6. A. At best, to use the bathroom as a place to try to impress the boss makes you look desperate. It also shows a lack of tact and judgment.

Most of these seem obvious, but based on interviews with leaders, subordinates commit these mistakes over and over in the workplace. Keep these missteps in mind so you don’t become an annoying follower.

Source: Based on William Speed Weed, Alex Lash, and Constance Loizos, “30 Ways to Annoy Your Boss,” MBA Jungle (March–April 2003), pp. 51–55.

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204 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

task-related relationship with their bosses that enables them to add value to the organization even when their ideas disagree with those of the leader.26

Followers should also be aware of behaviors that can annoy leaders and interfere with building a quality relationship. One business magazine interviewed powerful people about their pet peeves and identified more than two dozen misdemeanors that followers often commit without being aware of it.27

Most relationships between leaders and followers are characterized by some emo- tion and behavior based on authority and submission. Leaders are authority figures and may play a disproportionately large role in the mind of a follower.28 Exhibit 7.3 illustrates four tactics that enable followers to overcome the authority-based relation- ship and develop an effective, respectful relationship with their leaders.

Be a Resource for the Leader Effective followers align themselves with the purpose and the vision of the organization. By understanding the vision and goals, followers can be a resource of strength and support for the leader. An effective follower can com- plement the leader’s weaknesses with the follower’s own strengths.29 Similarly, effective followers indicate their personal goals and the resources they bring to the organization. Effective followers inform their leaders about their own ideas, beliefs, needs, and con- straints. The more leaders and followers can know the day-to-day activities and problems of one another, the better resources they can be for each other. At one

EXHIBIT 7.3 Ways to Influence Your Leader

NEW LEADER ACTION MEMO Leader’s Self-Insight 7.2 gives you a chance to see if you’re guilty of being an annoying follower.

CHAPTER 7 FOLLOWERSHIP 205

organization, a group of disabled employees took advantage of a board meeting to issue rented wheelchairs to the members, who then tried to move around the factory in them. Realizing what the workers faced, the board got the factory’s ramps improved, and the employees became a better resource for the organization.30

Help the Leader Be a Good Leader Followers’ influence upon a leader can enhance the leader or accentuate the leader’s shortcomings.31 Good followers seek the lea- der’s counsel and look for ways the leader can help improve their skills, abilities, and value to the organization. They help their leaders be good leaders by simply saying what they need in order to be good followers. If a leader believes a follower values his or her advice, the leader is more likely to give constructive guidance rather than unsympathetic criticism.

A leader can also become a better leader when followers compliment the leader for behavior that followers appreciate, such as listening, rewarding followers’ contribu- tions, and sharing credit for accomplishments.32 In addition, a follower can provide enthusiastic support for a leader, but not to the extent that the follower fails to be can- did with a leader who is unethical or threatens the values or objectives of the organiza- tion. It is in leaders’ best interests when followers help them make needed changes or avoid ethical problems.33 As further described in the Leader’s Bookshelf, good bosses want followers who are willing to provide critical feedback when it is needed.

Build a Relationship with the Leader Effective followers work toward an authentic relationship with their leaders, which includes developing trust and speaking honestly on the basis of that trust.34 By building a relationship with the leader, a follower makes every interaction more meaningful to the organization. Furthermore, the relationship is imbued with mutual respect rather than authority and submission. John Stroup, CEO of Belden Inc., says he learned this in a previous job at Danaher Corporation.

IN THE LEAD John Stroup, Belden Inc. John Stroup, CEO of Belden Inc., a maker of electrical cables, says he is much more likely to pro- mote followers who disagree with and challenge him occasionally. However, the key is whether they have the savvy to do it the right way. In his previous job at Danaher Corporation, Stroup saw some newly recruited senior managers get fired or transferred because they pushed for changes or urged their bosses to adopt ideas before they had built credibility with their superiors.

Stroup took the lesson to heart and began building positive and respectful relation- ships with his immediate supervisor and other top executives. Eventually, he told them he wanted to make a change in his division by offering certain customers complete solutions for their specific needs. It was a departure from standard procedures, and it represented a risky strategic shift for the company. His supervisor disagreed with the decision, but after hearing Stroup’s arguments, he eventually went along with it because “he recognized my strengths,” Stroup says. “I felt comfortable enough to push my point of view,” he adds, because the relationship was one based on trust and mutual respect.

The idea was a huge success, and Stroup was soon promoted to a group executive position.35

NEW LEADER ACTION MEMO As a leader, you can use strategies for managing up to create an equitable and re- spectful relationship with your superiors. You can help your supervisor be the best he or she can be by getting beyond submissive feelings and beha- viors, recognizing that leaders are fallible, and being a re- source for the leader.

206 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Other leaders have also learned that building a positive, respectful relationship with the boss is the best way to get important changes implemented. Followers can generate respect by asking questions about the leader’s experiences in the follower’s position, actively seeking feedback, and clarifying the basis for specific feedback and criticism from the leader. By doing so, followers are getting beyond submissive behavior by asking leaders to be accountable for their criticism, to have empathy for the followers’ position, and to share history about something both parties have in common—the organization.

View the Leader Realistically Unrealistic follower expectations present one of the biggest barriers to effective leader–follower relationships.36 Whereas it is reasonable to expect your superiors to be competent, it is naïve and unrealistic to expect them to be perfect. When we accept that leaders are fallible and will make many mis- takes, we open the path to an equitable relationship. Followers should view leaders as they really are, not as followers think they should be.

Similarly, effective followers present realistic images of themselves. Followers do not try to hide their weaknesses or cover their mistakes, nor do they criticize their leaders to others. Hiding mistakes is symptomatic of conforming or passive followers, and followers who waste their time trashing their superiors or the

LEADER’S BOOKSHELF Good Boss, Bad Boss: How to Be the Best and Learn from the Worst

by Robert I. Sutton

In Good Boss, Bad Boss, Stanford profes- sor Robert Sutton reminds us of the cost of bad bosses to both followers and organizations. He acknowledges the natural tension that exists between human needs and business results and emphasizes that good bosses take action when a situation becomes unbal- anced. Followers who work for abusive bosses are typically less productive, less satisfied, have more health problems, and make more errors.

WHAT GOOD BOSSES DO Unfortunately, most people know what it feels like to work for a bad boss. But what characteristics distinguish the good from the bad? Sutton cites research as well as amusing anecdotes from friends, colleagues, and his own experience. Here are some examples of what the best bosses do:

• They Reduce the Risk of Self- Delusion. “Developing and sustaining self-awareness should be at the top of the list for every boss,” Sutton writes. However, he also says that bosses are

“prone to bouts of cluelessness” and can tend to overestimate their strengths or fail to recognize their weaknesses. Good bosses reduce the risk of self-delusion by constantly seek- ing feedback. They encourage fol- lowers to challenge them, ask tough questions, and keep feeding them information, even if it is unpleasant or unflattering.

• They Don’t Let Power Go to Their Heads. In a chapter titled “Squelch Your Inner Bosshole,” Sutton warns leaders not to let their organizational power strip them of their humanity and turn them into jerks. Good bosses are never nagging or intimidating. The higher people go, the more they are likely to suffer from “power poisoning,” Sutton says, and become selfish and oblivious to the people around them.

• They Protect Their People. Good bosses don’t become selfish or obliv- ious. Instead, they are always focused on “controlling their moods and moves, accurately interpreting their impact on others, and making

adjustments on the fly.” In addition, good bosses protect the followers who work for them and make sure followers have the resources, time, and autonomy to do their work effec- tively. A key role of a good boss is to act as a “human shield” and protect people from “meddlesome execu- tives, nosy visitors, unnecessary meetings, and a host of other insults, intrusions, and time wasters.”

CAN WE ALL BE GOOD BOSSES? Most chapters in Good Boss, Bad Boss include questionnaires that allow readers to apply the concepts to their own lives and leadership. “If you are a boss,” Sut- ton reminds the reader, “your success depends on staying in tune with how others think, feel, and react to you. Bosses who persistently promote perfor- mance and humanity devote consider- able energy to reading and responding to followers’ feelings and actions.”

Source: Good Boss, Bad Boss, by Robert I. Sutton, is published by Business Plus.

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207 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

company intensify estrangement and reinforce the mindset of an alienated follower. These kinds of alienated and passive behaviors can have negative—and sometimes disastrous—consequences for leaders, followers, and the organization. Instead of criticizing a leader to others, it is far more constructive to directly disagree with a leader on matters relevant to the department’s or organization’s work.

THE POWER AND COURAGE TO MANAGE UP There are followers in almost every organization who remind us “how hollow the label of leadership sometimes is—and how heroic followership can be.”37 But standing up to the boss isn’t easy. Finding the courage to effectively manage up comes easier when you realize how much leaders depend on followers.38 It’s a fact that our bosses typically have more power than we do. Yet subordinates have more power than many people realize.

Sources of Power for Managing Up Exhibit 7.4 outlines several sources of power that can be used by followers to man- age up.

Personal Sources One personal source of upward influence is the follower’s knowl- edge and skills that are valuable to the organization. A subordinate with useful knowledge is of real benefit to the leader, and his or her departure would be a loss. In addition, someone who has a demonstrated record of performance often develops expertise and in this way can influence the boss’s decisions. A record of successes and a history of contributions can gain a follower expert status. When someone is recognized as an expert, that person often can influence activities because he or she becomes an indispensable resource to the leader. The power to influence is also associated with the effort followers put forth. By demonstrating a willingness to learn, to accept difficult or undesirable projects, and to initiate activi- ties beyond the scope of expected effort, people can increase their power.39

Another way to influence up with is persuasion, which refers to the direct appeal to leaders for desired outcomes.40 Rational persuasion—using facts and reason—is typically the most effective approach when trying to manage upward. By treating the issue in a business-like manner, formulating a carefully crafted argument and supporting it with details, followers gain attention and respect.41 However, followers can use a variety of influence tactics, depending on their own personalities and styles

EXHIBIT 7.4 Sources of Power for Managing Up

In many ways, great followership

is harder than leadership. It has

more dangers and fewer rewards.

Warren Bennis, leadership expert;

author of Still Surprised: A Memoir of a Life

in Leadership

20 15

208 PART 3 THE PERSONAL SIDE OF LEADERSHIP

and the preferences and style of the leader.42 Chapter 12 will discuss influence tactics in detail.

Position Sources A follower’s formal position also provides sources of power. For example, certain jobs or physical locations can render the follower visible to numer- ous individuals. A position that is key to the flow of information can establish that position and the person in it as critical—thus, influential—to those who need the information. A central location provides influence because the follower becomes known to many people and contributes to the work of many. Access to people and information in an organization provides a means to establish relationships with a broad range of people both inside and outside the organization. With a network of relationships, followers have more clout with the leader and more opportunity to persuade and make significant contributions.

Necessary Courage to Manage Up Some people tend to think, “Who am I to challenge the CEO (or director, or team leader)?” Yet leaders depend on followers who are willing to step up and challenge them when it is in the interest of the organization. Good followers are not yes men (or women). They are people who think for themselves and conduct their work lives with courage and integrity.43 The discussion of courage and integrity in Chapter 6 applies to followers as well as leaders. To be effective, followers have to know what they stand for and be willing to express their own ideas and opinions to their lea- ders, even though this might mean risking their jobs, being demeaned, or feeling inadequate.44 Effective followers have the courage to accept responsibility, chal- lenge authority, participate in change, serve the needs of the organization, and leave the organization when necessary.45

The Courage to Assume Responsibility The effective follower feels a sense of per- sonal responsibility and ownership in the organization and its mission. Thus, the follower assumes responsibility for his or her own behavior and its impact on the organization. Effective followers do not presume that a leader or an organization will provide them with security, permission to act, or personal growth. Instead, they initiate the opportunities through which they can achieve personal fulfillment, exercise their potential, and provide the organization with the fullest extent of their capabilities. Emiliana “Millie” Barela has been cleaning rooms for 32 years at Antlers at Vail, a Colorado ski lodge. She takes pride in her work and sees her job as an important part of creating a good experience for guests. Barela takes it upon herself to get to know guests and put their interests and needs first.46

The Courage to Challenge Effective followers do not sacrifice their personal integ- rity or the good of the organization in order to maintain harmony. If a leader’s actions and decisions contradict the best interests of the organization, effective fol- lowers take a stand. Obedience is considered a high virtue in military organizations, for example, but the U.S. Army teaches soldiers that they have a duty to disobey illegal or immoral orders.47 Good leaders want followers who are willing to chal- lenge them for the good of the organization. At Tyco International, which was one of the few large corporations that got caught up in the accounting scandals of the early 2000s and managed to restore its reputation, “the only career-ending move [today] is to not bring bad news forward,” says Laurie Siegel, senior vice president of human resources. It is a guiding principle at Tyco for leaders to surround

NEW LEADER ACTION MEMO As a follower, you can assume responsibility for your own personal development, behav- ior, and work performance. You can look for opportunities to make a difference, seek to meet organizational needs, serve others, and work toward the common good.

To evaluate whether you have ever worked for a destructive boss, log in to

CengageNOW to complete the interactive questionnaire.

CHAPTER 7 FOLLOWERSHIP 209

themselves with people who will speak up and hold them accountable. Managers’ leadership behaviors are assessed annually and include an evaluation of whether they are willing to challenge their superiors when necessary.48

The Courage to Participate in Transformation Effective followers view the struggle of corporate change and transformation as a mutual experience shared by all mem- bers of the organization. When an organization undergoes a difficult transforma- tion, effective followers support the leader and the organization. They are not afraid to confront the changes and work toward reshaping the organization. David Chislett, of Imperial Oil’s Dartmouth, Nova Scotia refinery, was faced with this test of courage. The refinery was the least efficient in the industry and the board of directors gave management nine months to turn things around. Chislett’s bosses asked him to give up his management position and return to the duties of a wage earner as part of an overall transformation strategy. He agreed to the request, thereby contributing to the success of the refinery’s transformation.49

The Courage to Serve An effective follower discerns the needs of the organization and actively seeks to serve those needs. Just as leaders can serve others, as discussed in the previous chapter, so can followers. A follower can provide strength to the leader by supporting the leader and by contributing to the organization in areas that complement the leader’s position. By displaying the will to serve others over them- selves, followers act for the common mission of the organization with a passion that equals that of a leader. Laurie Stein, general counsel of Clorox Company, proved her- self to be an exceptional follower after the company hired an outside CEO.

IN THE LEAD Laurie Stein, Clorox One expert estimates that managers have a 30Ĝpercent to 40Ĝpercent chance of being fired after a company hires an outside CEO. The best strategy? Make it your job to serve the new leader and help him or her succeed.

That’s what Laurie Stein, general counsel of Clorox, did. Before Donald Knauss even took the CEO job, Stein did extensive research on him to help her know how to work with him most effectively. She learned, for example, that Knauss prefers one-page memos rather than reams of data and informal interactions rather than formal meetings. In addition, she began looking for how she could best serve Knauss and the organization as it embarked on a new path. Even if she disagreed with any strategic changes he wanted to make, Stein believed it was her job to support them.

Since Stein had previously worked in China, she volunteered to informally advise col- leagues about revamping the company’s strategy in that country. Knauss appreciated Stein’s proactive, service-oriented approach. “She will help anyone who asks for help,” he says. Within months of taking the CEO job, Knauss had broadened Stein’s duties and power.50

The Courage to Leave Sometimes organizational or personal changes create a situa- tion in which a follower must withdraw from a particular leader–follower relation- ship. People might know they need new challenges, for example, even though it is

210 PART 3 THE PERSONAL SIDE OF LEADERSHIP

hard to leave a job where they have many friends and valued colleagues. If fol- lowers are faced with a leader or an organization unwilling to make necessary changes, it is time to take their support elsewhere. In addition, a follower and leader may have such strong differences of opinion that the follower can no longer support the leader’s decisions and feels a moral obligation to leave. U.S. general John Batiste turned down a promotion and resigned because he felt he could no longer support civilian leaders’ decisions regarding Iraq. The role of military offi- cers is to advise civilian leaders and then carry out orders even when they disagree. General Batiste spent weeks torn between his sense of duty and respect for the chain of command and a feeling that he owed it to his soldiers to speak out against lea- ders’ decisions. Ultimately, believing he could no longer serve his leaders as he should, the general had the courage to leave the job, even though it meant the end of a lifelong career he highly valued.51

WHAT FOLLOWERS WANT FROM LEADERS Throughout much of this chapter, we’ve talked about demands on followers and how followers can become more effective and powerful in the organization. How- ever, the full responsibility doesn’t fall on the follower. Good followers are created partly by leaders who understand their requirements and obligations for developing people.52

Research indicates that followers have expectations about what constitutes a desirable leader.53 Exhibit 7.5 shows the top four choices in rank order based on surveys of followers about what they desire in leaders and colleagues.

Followers want their leaders to be honest, forward-thinking, inspiring, and competent. A leader must be worthy of trust, envision the future of the organiza- tion, inspire others to contribute, and be capable and effective in matters that will affect the organization.

Followers want their fellow followers to be honest and competent but also dependable and cooperative. Thus, desired qualities of colleagues share two quali- ties with leaders—honesty and competence. However, followers themselves want other followers to be dependable and cooperative rather than forward-thinking and inspiring. The hallmark that distinguishes the role of leadership from the role of followership, then, is not authority, knowledge, power, or other conventional notions of what a follower is not. Rather, the distinction lies in the clearly defined leadership activities of fostering a vision and inspiring others to achieve that vision. Chapter 13 discusses vision in detail, and Chapter 14 describes how leaders shape cultural values that support achievement of the vision.

EXHIBIT 7.5 Rank Order of Desirable Characteristics

Desirable Leaders Are Desirable Colleagues (Followers) Are

Honest Honest Forward-thinking Cooperative Inspiring Dependable Competent Competent

Source: Adapted from James M. Kouzes and Barry Z. Posner, Credibility: How Leaders Gain and Lose It, Why People Demand It (San Francisco, CA: Jossey-Bass Publishers, 1993), p. 255.

NEW LEADER ACTION MEMO As a follower, you can support your leaders through difficult times, but have the courage to challenge your superiors when their behavior or decisions contradict the best interests of the organization.

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The results in Exhibit 7.5 also underscore the idea that behaviors of effective leaders and followers often overlap. Followers do not want to be subjected to leader behavior that denies them the opportunity to make valued contributions. Leaders have a responsibility to enable followers to fully contribute their ideas and abilities. Four specific ways leaders enhance the abilities and contributions of followers are by offering clarity of direction; providing opportunities for growth; giving honest, constructive feedback; and protecting followers from orga- nizational roadblocks.

Clarity of Direction It is the leader’s job to clearly communicate where the group or organization is going and why.54 Creating an inspiring vision is only one aspect of setting direc- tion. Followers also need specific, unambiguous goals and objectives on both an individual and team level. Numerous studies have shown that clear, specific, chal- lenging goals enhance people’s motivation and performance.55 Having clear goals helps people know where to focus their attention and energy, enables them to track their own progress, and lets them feel a sense of pride and accomplishment when goals are achieved.

Another aspect of clarifying direction is helping followers see how their own individual jobs fit in the larger context of the team, department, and total enter- prise. This is one reason many leaders use open-book management. When people can see the bigger financial picture, they have a perspective on where the organiza- tion stands and how they can contribute.

Opportunities for Growth Leaders can act as coaches to help followers upgrade their skills and enhance their career development. Leadership coaching is a method of directing or facilitating a follower with the aim of improving specific skills or achieving a specific develop- ment goal, such as developing time management skills, enhancing personal productiv- ity, or preparing for new responsibilities. Coaching doesn’t mean trying to change people and make them something other than what they are. Instead, it means helping followers realize their potential.56

To understand what it means to be a leadership coach, consider the difference in mindset and behavior required for managing versus coaching:

Managing Coaching57

Telling Empowering Judging Facilitating, removing obstacles Controlling Developing

Rather than telling followers what to do, directing and controlling their behavior, and judging their performance, which is a traditional management role, leadership coaching involves empowering followers to explore, helping them understand and learn, providing support, and removing obstacles that stand in the way of their abil- ity to grow and excel.

Exhibit 7.6 shows benefits that followers get from leadership coaching, includ- ing gaining a new perspective, getting advice on handling specific organizational situations, dealing with organizational politics, and receiving encouragement and support. The biggest benefit that followers report, however, is getting clear, direct feedback on performance.58

212 PART 3 THE PERSONAL SIDE OF LEADERSHIP

Leadership coaching a method of directing or facilitating a follower with the aim of improving specific skills or achieving a specific development goal

Frequent, Specific, and Immediate Feedback Candid feedback is one of the most important elements contributing to the growth and development of followers, but many leaders don’t know how to give good feed- back.59 Effective leaders see feedback as a route to improvement and development, not as something to dread or fear. When a leader provides feedback, it signals that the leader cares about the follower’s growth and career development and wants to help the person achieve his or her potential.60

Feedback occurs when a leader uses evaluation and communication to help individuals learn about themselves and improve.61 Effective leaders provide both positive and negative constructive feedback on an ongoing basis. If someone han- dles a difficult task, for instance, the leader offers feedback on the spot rather than letting the person wonder how effective he or she was, perhaps imagining the worst. As former advertising account executive Ryan Broderick said, “hearing something is better than hearing nothing.”62

Followers appreciate positive feedback, but they also want to know when they aren’t doing what is expected of them, and they want the feedback to be specific enough to enable them to do better. Leaders who avoid giving any critical feedback “achieve kindness in the short term but heartlessness in the long run, dooming the problem employee to non-improvement.”63 Here are some ways leaders can provide feedback that benefits followers and takes less of an emotional toll on both leader and follower:64

1. Make it timely. People shouldn’t have to wait for an annual review to know how they’re doing or how they can improve. Leaders should give feedback as soon as possible after they observe a behavior or action they want to correct or reinforce. Often, this means immediately, such as when a leader says, “Great job on the

EXHIBIT 7.6 Follower Benefits from Leadership Coaching

Source: “The Business Leader as Development Coach,” PDI Portfolio (Winter 1996), p. 6; and Personnel Decisions International, http://www.personneldecisions.com.

NEW LEADER ACTION MEMO As a leader, you can make feedback a regular habit and remember to include positive comments and praise as well as critical feedback. As a fol- lower, you can view feedback as a chance to improve your- self. Reframe negative feed- back in a way that helps you take positive action toward what you want out of your work and life.

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Feedback using evaluation and com- munication to help indivi- duals and the organization learn and improve

presentation, Sal, and you used graphics very effectively. The only place I see it could have been better would be including some specifics like past sales figures. Do you know where to find that information, or would you like me to set up a meeting with our sales manager?” If leaders wait to offer feedback, it should be only long enough to gather necessary information or to marshal their thoughts and ideas.

2. Focus on the performance, not the person. Feedback should not be used simply to criticize a person or to point out faults. A person who feels like he or she is being attacked personally will not learn anything from the feedback. The focus should always be on how the follower can improve. Leaders have to point out work that is poorly done, but it is equally important to reinforce work that is done well. This helps people learn from what they do right, and softens the impact of negative feedback.

3. Make it specific. Effective feedback describes the precise behavior and its conse- quences and explains why the leader either approves of the behavior or thinks there is a need for improvement. The leader might provide illustrations and examples to clarify what behavior is considered effective, and he or she always checks for under- standing rather than assuming the follower knows what actions the leader wants.

4. Focus on the desired future, not the past. Good leaders don’t drag up the failures and mistakes of the past. In addition, if it is clear that a follower’s mistake was a one-time occurrence and not likely to be repeated, the leader will let it go rather than offering negative feedback. Effective feedback looks toward the future, mini- mizes fault-finding, and describes the desired behaviors and outcomes.

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 7.3

Ready for Coaching

Instructions: Think about your attitude toward personal growth and answer the following questions Mostly False or Mostly True.

Mostly False

Mostly True

1. I have a strong desire to improve myself.

2. I welcome suggestions for better ways of behaving.

3. I am really honest with myself about my strengths and weaknesses.

4. I welcome negative feedback. 5. I follow through on commit-

ments to change myself. 6. I am very open with my peers

about any mistakes I make. 7. I draw my boss’s attention to my

successes. 8. After making a mistake, I immedi-

ately let the affected people know about it and propose a solution.

Scoring and Interpretation Give yourself 1 point for each Mostly True answer. Total Score . Leadership coaching is one way leaders provide valuable feedback that helps people achieve their potential. The attitude of the follower is equally important to that of the leader for a successful coaching relationship. Your score for this questionnaire pertains to your readiness to receive coaching and feedback from another person. If your score is 6 or above, you probably have the correct mindset to benefit from leadership coaching. If your score is 3 or below you may not be receptive to coaching. If you are not open to receiving coaching for yourself, do you think you would be a good coach to others? Would you like to change your coaching mindset? What is the first step you might take?

Source: Based on Susan Battley, Coached to Lead: How to Achieve Extraor- dinary Results with an Executive Coach (San Francisco: Jossey-Bass, 2006), pp. 20–40.

NEW LEADER ACTION MEMO Answer the questions in Leader’s Self-Insight 7.3 to learn if you have the correct mindset to benefit from leadership coaching.

| D re am

st im e. co m

214 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Protection from Organizational Intrusions Good followers want to do their jobs to the best of their abilities. They don’t want to be continually interrupted by managers offering questions or suggestions, and they don’t want to have to fight against organizational politics, leader uncertainties, or useless procedures. As was described in the Leader’s Bookshelf earlier in this chapter, the best leaders “take pride in being human shields.”65 They stay out of the way so people can do their jobs, and they protect their followers from time wasters such as burdensome organizational practices (think routine reports that no one reads), pushy or critical higher executives, abusive or overly demanding custo- mers or clients, and unnecessary meetings.

Good leaders take the heat so employees don’t have to. One leader at South- west Airlines interrupted a customer who was mistreating a gate agent, told him he wouldn’t allow his employees to be treated that way, and accompanied the customer to another airline’s counter to buy him a ticket. Will Wright, who was responsible for developing the computer games The Sims and Spore, charged his designers a dollar every time they called an unnecessary meeting that wasted artists’ time.66 Leaders invest time and effort into helping their sub- ordinates be good followers. And when people can’t or won’t learn and change, good leaders get rid of the “bad apples” rather than letting them infect the entire team.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • The important role of followership in organizations is increasingly recognized.

Leaders and followers are interdependent, and people are followers more often than leaders.

• People who effectively manage both up and down the hierarchy are more suc- cessful, but managing up can be difficult for new leaders. Strategies for manag- ing up include being a resource, helping the leader be a good leader, building a relationship with the leader, and viewing the leader realistically.

• Leaders want followers who are positive and self-motivated, who take action to get things done, who accept responsibility, and who excel at required tasks. An effective follower is both independent and active in the organization. Being an effective follower depends on not becoming alienated, conforming, passive, or a pragmatic survivor.

• Effective followership is not always easy. Effective followers display the cour- age to assume responsibility, to challenge their leaders, to participate in trans- formation, to serve others, and to leave the organization when necessary. Followers can recognize and rely on several personal and positional sources of power to gain the courage to manage up.

• Followers want both their leaders and their colleagues to be honest and compe- tent. However, they want their leaders also to be forward-thinking and inspira- tional. The two latter traits distinguish the role of leader from follower. Followers want to be led, not controlled. They also want leaders to create an environment that enables people to contribute their best.

Tw itt er

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• Four specific ways leaders enhance the abilities and contributions of followers are by offering clarity of direction, providing opportunities for growth, giving honest, constructive feedback, and protecting followers from organizational intrusions.

• Followers want feedback that is timely and specific, focuses on performance rather than the person, and focuses on the future rather than dragging up mis- takes of the past.

DISCUSSION QUESTIONS 1. Discuss the role of a follower. Why do you think so little emphasis is given to follower-

ship compared to leadership in organizations?

2. As a leader, what would you want most from followers? As a follower, what would you want most from your leader? How do these differ? Why?

3. Compare the alienated follower with the passive follower. Can you give an example of each? Have you ever been either one? How would you respond to each if you were a leader?

4. Why is managing up important in organizations? Describe the strategy for managing up that you most prefer. Explain.

5. The chapter describes five ways in which followers need to use courage. Which do you feel is most important? Least important? How might a follower derive the courage to behave in new ways to be more effective? Discuss.

6. Do you think you would respond better to feedback that is presented using a traditional scheduled performance review format or feedback that is presented as a routine part of everyday work activities? Discuss. How do you think leaders should frame negative feedback to achieve the best results?

7. Which type of follower courage is easiest for you to use? Hardest for you to use? Can you think of ways to expand your power for influencing up?

8. One organizational observer suggested that bosses who won’t give negative feedback to followers who need it cause even more damage in the long run than those who fly off the handle when a follower makes a mistake. Do you agree? Discuss.

9. What does leadership coaching mean to you? How should leaders decide which fol- lowers they will provide with coaching?

10. What does it mean for a leader to act as a human shield? Do you believe this should be part of a leader’s responsibility to followers?

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C a C

LEADERSHIP AT WORK Follower Role Play You are a production supervisor at Hyperlink Systems. Your plant produces circuit boards that are used in Nokia cell phones and IBM computers. Hyperlink is caught in a competitive pricing squeeze, so senior management hired a consultant to study the production depart- ment. The plant manager, Sue Harris, asked that the consultant’s recommendations be implemented immediately. She thought that total production would increase right away. Weekly production goals were set higher than ever. You don’t think she took into account the time required to learn new procedures, and plant workers are under great pressure. A handful of workers have resisted the new work methods because they can produce more cir- cuit boards using the old methods. Most workers have changed to the new methods, but

216 PART 3 THE PERSONAL SIDE OF LEADERSHIP

their productivity has not increased. Even after a month, many workers think the old ways are more efficient, faster, and more productive.

You have a couple of other concerns with Harris. She asked you to attend an operations conference, and at the last minute sent another supervisor instead without any explanation. She has made other promises of supplies and equipment to your section and then has not followed through. You think she acts too quickly without adequate implementation and follow-up.

You report directly to Harris and are thinking about your responsibility as a follower. Write below specifically how you would handle this situation. Will you confront her with the knowledge you have? When and where will you meet with her? What will you say? How will you get her to hear you?

What style—effective, conformist, passive, alienated—best describes your response to this situation? Referring to Exhibit 7.3, which tactic would you like to use to assist Harris?

In Class: The instructor can ask students to volunteer to play the role of the plant manager and the production supervisor. A few students can take turns role-playing the production supervisor in front of the class to show different approaches to being a follower. Other stu- dents can be asked to provide feedback on each production supervisor’s effectiveness and on which approach seems more effective for this situation.

Source: Based on K. J. Keleman, J. E. Garcia, and K. J. Lovelace, Management Incidents: Role Plays for Management Development (Dubuque, IA: Kendall Hunt Publishing Company, 1990), pp. 73–75, 83.

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C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Waiting for Clearance He wanted the help, but CEO Tony Bussard apparently wanted to relinquish none of the power when he agreed with board members of Alvon Biometrics to maintain control over the financial and administrative side of the company while naming a COO to oversee day- to-day operations.

Everyone agreed that the job was too big for one guy. After months of assessments, interviews, and discussion, Juan Carlos De la Vega was hired as COO for the company.

De la Vega came to Alvon from a smaller rival company and was initially excited about his new position and the future of Alvon. De la Vega trained in military security investiga- tions and became interested in the measuring and statistical analysis of biological data that included fingerprints, eye retinas and irises, voice patterns, and facial patterns that could be used in security systems. He had worked his way up through rival Bi-Tech to a position in middle management and jumped at the opportunity to guide a major company in the field about which he was so passionate. “That is so cool,” was a De la Vega trademark comment as he delighted in the giant leaps of each system’s gadgetry.

But De la Vega’s exciting new position came with its own set of frustrations as he tried to plunge into the rapidly changing technology while simultaneously fitting into the organi- zation and tip-toeing around Tony Bussard’s ego.

CHAPTER 7 FOLLOWERSHIP 217

Bussard welcomed De la Vega with the gusto of an under-fire field officer who looks up to see reinforcements riding into the fray. He enthusiastically introduced the new COO to everyone and raved, almost to the point of embarrassment, about De la Vega’s experience and level of expertise in the field of biometrics.

“You’ve made my job a whole lot easier,” Bussard gushed. “We’re all thrilled to have you.” Now, one year into the job, De la Vega was still wondering what was expected of him

and where Bussard’s duties ended and his duties began. Those things were never actually spelled out in an agreement, and the boundaries remained vague and confusing. Even during the initial job interviews, Bussard and board members showed great interest in De la Vega’s background and talked endlessly about Bussard’s vision for the future. But now, in retro- spect, the COO realized that there was little or no discussion of his vision or any mention about how he would fit into the future being laid out for him.

With no clear agreement, De la Vega’s earnest efforts to get guidance about his respon- sibilities seemed to be brushed aside by the CEO, who remained elusive and vague.

“If he tells me one more time, ‘Yeah, yeah, we’ll talk,’ I think I will scream,” De la Vega complained. “I want to feel like a COO, not a sidekick to the CEO. At the same time, I don’t want to push so hard that Bussard and the board members become concerned that they made a mistake in selecting me.”

The confusion about De la Vega’s role also filtered down the ranks. Employees, expect- ing initiative from De la Vega, remained uncertain about his range of responsibilities. People looked almost exclusively to Bussard for direction, by-passing the new COO. Workers liked De la Vega and admired his industry experience. However, old habits die hard, and the habit of yielding to Bussard’s leadership remained intact. Even one year later, employees were reluctant to take a chance on angering Bussard by shifting even a portion of their attention and allegiance to De la Vega.

For his part, De la Vega knew the time for clarity was now, but he hesitated, not know- ing exactly how or when to approach the CEO from a position of strength.

QUESTIONS

1. If you were De la Vega, what would you do at this point? Do you think De la Vega has waited too long to make a substantial change in his relationship with Bussard? Why?

2. How would you characterize De la Vega’s style as a follower? What tactics might help improve his relationship with Bussard? Explain.

3. If you were in De la Vega’s position, what would you have done from the beginning? Be specific about your actions and timing.

Jake’s Pet Land Adam Gerrit glanced up from the cash register as his first customers of the day walked into Jake’s Pet Land, a neighborhood pet store that is part of a small, regional chain. A young boy, obviously distraught, reluctantly placed a shoebox on the counter. “We have a problem,” whispered the boy’s dad, “and I would like to get a refund.” Cautiously, Adam lifted the lid of the shoebox and found an ebony-colored chinchilla hunched in the corner of the box, huddled in wood chips and barely breathing. Normally inquisitive and active, the chinchilla was obviously sick. The boy’s father, a loyal customer for several years, handed Adam a receipt. Adam knew the refund policy by heart: “The health of exotic animals is guaranteed for seven days after purchase. No refunds are granted after seven days.” The chinchilla had been purchased 10 days ago, but Adam, as a long-time employee, knew his manager would agree to bend the rules in this case and grant this cus- tomer a full refund. Putting the policy manual out of his mind, Adam handed the cus- tomer a full refund of $125, saying to the distraught boy, “I’m sorry your little buddy

218 PART 3 THE PERSONAL SIDE OF LEADERSHIP

didn’t make it. Would you like to look for another pet?” Although he had clearly stretched the return policy rules, Adam felt confident that his store manager, Phillip Jordan, would support his decision.

Jordan did support Adam’s decision to bend company rules if it meant retaining a loyal customer. Although the store’s thick policy manual called for strict adherence to established procedures, Jordan encouraged employees to think independently when meet- ing the needs of customers. Jordan also felt strongly about building camaraderie among his small staff, even if it meant straying outside the edicts in the policy manual. For exam- ple, Jordan bought the entire staff pizza and soft drinks as a reward for their cheerful atti- tude when asked to stay late to clean out the stockroom after the store closed. While they restocked shelves and mopped the stockroom floor, his employees told stories, traded jokes, and enjoyed helping each other complete the job quickly. Jordan was proud of the productive yet friendly culture he had created, even if his district manager would frown on some of his decisions.

Without surprise, Jordan’s store steadily increased revenue, up 5 4 percent from the previous year. Employees were motivated and enthusiastic. One factor contributing to the store’s success was low employee turnover. Again setting company policy aside, Jordan retained his employees by offering slightly higher wages, granting small promotions with increased responsibilities, and rewarding “VIP” employees with free passes to a local theme park. Since all of the employees were pet owners, he also allowed employees to take home overstocked pet supplies and free samples of new pet foods. This loyalty to employees resulted in a successful store. But Jordan knew his district manager would abruptly end all of these practices if he knew about them, so Jordan learned to keep guarded secrets.

Trouble began when Jordan was transferred to another store, closer to his home, and a new manager with a completely different managerial style was brought in. Wedded to rules and procedures, Jan Whitall was driven by order and discipline. On Whitall’s first day on the job, she set the tone for her tenure with this announcement: “The company’s new com- pensation policy will be strictly followed in this store, and some of you will have your pay reduced to adhere to the new pay scales. This is uncomfortable for me, but it’s the result of some questionable decisions by your previous manager.” The morale of top performers, including Adam, plummeted. By the end of Whitall’s first month, she had fired an employee for violating the store’s return policy. The employee had granted a full refund for a ball python after the seven-day return period. Another employee was publicly reprimanded for giving a customer a sample of a new organic pet food to try before purchasing it. Stunned by these actions, employees became indignant and bristled under her tight authority. The friendly, warm culture had vanished. Adam Gerrit confided to his coworker, “I’ve applied for a position at the pet superstore down the road. Before I resign, I’m going to talk to Jan and see if she can lighten up on the rules.”

Mustering his courage, Adam tapped on Whitall’s office door and asked if he could talk with her. Putting down her reading glasses and pushing away the financial reports in front of her, Whitall motioned for him to sit down. “I’m worried about morale around here,” Adam began. “Some of our best workers are leaving and I’m considering it, too. Under our previ- ous manager, I loved coming to work and enjoyed the friendship of coworkers and custo- mers. Now, everyone is in a sour mood and we’ve lost some customers.” Taking a deep breath, he continued. “If you are willing to be more flexible with the company policies, I would be willing to stay.” Unflustered, Whitall kept her firm stance. “Adam,” she explained, “I’m responsible to the district manager, who long suspected that the previous manager wasn’t adhering to company policies. It’s my intention to do my job the way I’ve been instructed, and I’m sorry to hear you will be leaving.”

As Adam left her office with his head down, Whitall mused to herself that the district man- ager would be proud of her ability to stand firm. In fact, he had recently complimented her on her approach. Neither realized that sales would take a surprising dip in the next quarter.

CHAPTER 7 FOLLOWERSHIP 219

QUESTIONS

1. Which store manager—Phillip Jordan or Jan Whitall—would you prefer working for? How did each leader’s style affect the culture of the pet store? Explain.

2. What kind of follower was Adam Gerrit? In general, what characteristics of followers do you admire? What characteristics would you want them to display when working for you?

3. If you were the district manager, which store manager would you prefer to have work- ing for you? Why? In your opinion, which manager did a better job of managing up? Which manager did a better job of managing down?

REFERENCES 1. Based on a story in Marc Hurwitz and Samantha Hurwitz, “The

Romance of the Follower: Part 1,” Industrial and Commercial Training 41, no. 2 (2009), pp. 80–86.

2. Ibid.

3. Robin Sronce and Lucy A. Arendt, “Demonstrating the Interplay of Leaders and Followers,” Journal of Management Education 33, no. 6 (December 2009), pp. 699–724; Hurwitz and Hurwitz, “The Romance of the Follower: Part 1”; and Marc Hurwitz and Samantha Hurwitz, “The Romance of the Follower: Part 2,” Industrial and Commercial Training 41, no. 4 (2009), pp. 199–206.

4. Warren Bennis, “Art of Followership: Followers Engage in an Interdependent Dance,” Leadership Excellence (January 2010), pp. 3–4; and Robert E. Kelley, “In Praise of Followers,” Harvard Business Review (November/December 1988), pp. 142–148.

5. John G. Gabarro and John P. Kotter, “Managing Your Boss,” Best of HBR 1980, Harvard Business Review (January 2005), http://hbr.org /2005/01/managing-your-boss/ar/1 (accessed April 18, 2011).

6. Rosabeth Moss Kanter, “Power Failure in Management Circuits,” Harvard Business Review 57 (July–August, 1979), pp. 65–75.

7. Ronald J. DeLuga, “Kissing Up to the Boss: What It Is and What to Do about It,” Business Forum 26 (2003), pp. 14–18; and Bennett Tepper, “Upward Maintenance Tactics in Supervisory Mentoring and Nonmentoring Relationships,” Academy of Management Journal 38, no. 4 (1995), pp. 1191–1205.

8. Liz Simpson, “Why Managing Up Matters,” Harvard Management Update (August 2002), pp. 3–5; and Stanley Bing, Throwing the Elephant (New York: HarperCollins, 2002).

9. Irvin D. Yalom, with Ben Yalom, “Mad about Me,” Inc. (December 1998), pp. 37–38; and story told in Robert McGarvey, “And You Thought Your Boss Was Bad,” American Way (May 1, 2006), pp. 69–74.

10. These are based on Larry Bossidy, “What Your Leader Expects of You and What You Should Expect,” Leadership Excellence (February 2008), p. 6; Larry Bossidy, “What Your Leader Expects of You,” Harvard Business Review (April 2007), pp. 58–65; and Peter F. Drucker, “Drucker on Management: Managing the Boss,” The Wall Street Journal (August 1, 1986).

11. Vignette recounted in Isaac Getz, “Liberating Leadership: How the Initiative-Freeing Radical Organizational Form Has Been Successfully Adopted,” California Management Review (Summer 2009), pp. 32–58.

12. Bossidy, “What Your Leader Expects of You.”

13. Robert E. Kelley, The Power of Followership (New York: Doubleday, 1992).

14. Ibid.

15. Discussed in Michael G. Winston, “Say No to Yes Men,” Leadership Excellence (November 2010), p. 15.

16. Kelley, The Power of Followership, pp. 111–112.

17. Ibid. pp. 111–112, 117–118.

18. Based on an incident reported in “Ask Inc.,” Inc. (March 2007), pp. 81–82.

19. Kelley, The Power of Followership, p. 123.

20. Melanie Trottman, “Baggers Get the Sack, but Dawn Marshall Still Excels as One,” The Wall Street Journal (May 2, 2003), pp. A1, A6.

21. Bennis, “Art of Followership”; Sronce and Arendt, “Demonstrating the Interplay of Leaders and Followers”; Marshall Goldsmith, “Influencing Up: You Make a Difference,” Leadership Excellence (January 2008), pp. 5–6; David K. Hurst, “How to Manage Your Boss,” Strategy + Business no. 28 (Third Quarter 2002), pp. 99–103; Joseph L. Badaracco Jr., Leading Quietly: An Unorthodox Guide to Doing the Right Thing (Boston: Harvard Business School Press, 2002); and Michael Useem, Leading Up: How to Lead Your Boss So You Both Win (New York: Crown Business, 2001).

22. Hurwitz and Hurwitz, “The Romance of the Follower: Part 1.”

23. Based on Jo Owen, “Manage Your Boss,” Industrial and Commercial Training 39, no. 2 (2007), pp. 79–84.

24. Ryan Lizza, “The Political Scene: The Obama Memos,” The New Yorker (January 30, 2012), pp. 36–49; Peter Baker, “How Obama’s Afghanistan War Plan Came to Be,” International Herald Tribune (December 7, 2009); and Ron Walters, “Afghanistan: The Big Decision,” The Washington Informer (December 10–16, 2009).

25. Len Schlesinger, “It Doesn’t Take a Wizard to Build a Better Boss,” Fast Company (June/July 1996), pp. 102–107.

26. Ira Ira Chaleff, “Courageous Followers: Should We Stand Up To or For Leaders?” Leadership Excellence (April 2011), p. 19; and Hurst, “How to Manage Your Boss.”

27. William Speed Weed, Alex Lash, and Constance Loizos, “30 Ways to Annoy Your Boss,” MBA Jungle (March–April 2003), pp. 51–55.

28. Judith Sills, “When You’re Smarter Than Your Boss,” Psychology Today (May–June 2006), pp. 58–59; Sarah Kershaw, “My Other Family Is the Office,” The New York Times (December 4, 2008), p. E1; and Frank Pittman, “How to Manage Mom and Dad,” Psychology Today (November/December 1994), pp. 44–74.

29. Ira Chaleff, The Courageous Follower: Standing Up To and For Our Leaders (San Francisco: Berrett-Koehler, 1995); and John J. Gabarro and John P. Kotter, “Managing Your Boss,” Harvard Business Review, “Best of HBR” (January 2005), pp. 92–99.

30. Example from Christopher Hegarty, How to Manage Your Boss (New York: Ballantine, 1985), p. 147.

220 PART 3 THE PERSONAL SIDE OF LEADERSHIP

31. Chaleff, Courageous Followers.

32. Ibid.

33. Ibid.; and Ira Chaleff, “Learn the Art of Followership,” Government Executive (February 1997), p. 51.

34. Chaleff, The Courageous Follower: Standing Up To and For Our Leaders.

35. Joann S. Lublin, “Arguing with the Boss: A Winning Career Strategy,” The Wall Street Journal (August 9, 2012), http://online.wsj.com/article /SB10000872396390443991704577579201122821724.html (accessed April 9, 2013).

36. This is based on Goldsmith, “Influencing Up: You Make a Difference” and Hegarty, How to Manage Your Boss.

37. Warren Bennis, “Art of Followership: Followers Engage in an Interdependent Dance,” Leadership Excellence (January 2010), pp. 3–4.

38. Gabarro and Kotter, “Managing Your Boss.”

39. Peter Moroz and Brian H. Kleiner, “Playing Hardball in Business Organizations,” Industrial Management (January/February 1994), pp. 9–11.

40. Warren Keith Schilit and Edwin A. Locke, “A Study of Upward Influence in Organizations,” Administrative Science Quarterly 27 (1982), pp. 304–316.

41. Mary C. Gentile, “Keeping Your Colleagues Honest,” Harvard Business Review (March 2010), pp. 114–117; and Goldsmith, “Influencing Up: You Make a Difference.”

42. Deepti Bhatnagar, “Evaluation of Managerial Influence Tactics,” Journal of Managerial Psychology 8, no. 1 (1993), pp. 3–9; and Daniel M. Cable and Timothy A. Judge, “Managers’ Upward Influence Tactic Strategies: The Role of Manager Personality and Supervisor Leadership Style,” Journal of Organizational Behavior 24 (2003), pp. 197–214.

43. Winston, “Say No to Yes Men.”

44. David N. Berg, “Resurrecting the Muse: Followership in Organiza- tions,” presented at the 1996 International Society for the Psycho- analytic Study of Organizations (ISPSO) Symposium, New York, NY, June 14–16, 1996.

45. Chaleff, The Courageous Follower: Standing Up To and For Our Leaders.

46. Reported in Del Jones, “What Do These 3 Photos Have in Common? They Show Leaders and Their Followers, Winning Combos,” USA Today (December 10, 2003), p. 1B.

47. Major (General Staff) Dr. Ulrich F. Zwygart, “How Much Obedience Does an Officer Need? Beck, Tresckow, and Stauffenberg—Examples of Integrity and Moral Courage for Today’s Officer,” Combat Studies Institute; U.S. Army Command and General Staff College, Fort Leavenworth, Kansas, http://www.cgsc.edu/CARL/download/csipubs /ObedienceOfficerNeed_Zwygart.pdf (accessed June 11, 2013).

48. “Ethics Lessons from Tyco for Today’s Financial Crisis,” a talk given by Eric Pillmore at Thunderbird School of Global Management, O c t o b er 2 8 , 2 0 0 8 , h t t p : / / k n o w le d g e n et wo r k . t h u n d er b i rd .edu/research/2008/10/30/takeaways-from-tyco-for-today%E2% 80%99s-financial-crisis/ (accessed April 10, 2013); and Lublin, “Arguing with the Boss: A Winning Career Strategy.”

49. Merle MacIsaac, “Born Again Basket Case,” Canadian Business (May 1993), pp. 38–44.

50. Joann S. Lublin, “How to Prove You’re Keeper to a New CEO,” The Wall Street Journal (March 8, 2013), p. B8.

51. Greg Jaffe, “The Two-Star Rebel: For Gen. Batiste, a Tour in Iraq Turned a Loyal Soldier into Rumsfeld’s Most Unexpected Critic,” The Wall Street Journal (May 13, 2006), p. A1.

52. Berg, “Resurrecting the Muse.”

53. James M. Kouzes and Barry Z. Posner, Credibility: How Leaders Gain and Lose It, Why People Demand It (San Francisco: Jossey- Bass, 1993).

54. This section is based largely on Bossidy, “What Your Leader Expects of You.”

55. See Gary P. Latham and Edwin A. Locke, “Enhancing the Benefits and Overcoming the Pitfalls of Goal Setting,” Organizational Dynamics 35, no. 4 (2006), pp. 332–338; Edwin A. Locke and Gary P. Latham, “Building a Practically Useful Theory of Goal Setting and Task Motivation: A 35-Year Odyssey,” The American Psychol- ogist 57, no. 9 (September 2002), p. 705ff.; Gary P. Latham and Edwin A. Locke, “Self-Regulation through Goal Setting,” Organiza- tional Behavior and Human Decision Processes 50, no. 2 (1991), pp. 212–247; G. P. Latham and G. H. Seijts, “The Effects of Proximal and Distal Goals on Performance of a Moderately Complex Task,” Journal of Organizational Behavior 20, no. 4 (1999), pp. 421–428; P. C. Early, T. Connolly, and G. Ekegren, “Goals, Strategy Development, and Task Performance: Some Limits on the Efficacy of Goal Setting,” Journal of Applied Psychology 74 (1989), pp. 24–33; and E. A. Locke, “Toward a Theory of Task Motivation and Incentives,” Organizational Behavior and Human Performance 3 (1968), pp. 157–189.

56. Patrick Sweeney, “Developing Leadership Potential through Coach- ing,” Chief Learning Officer (March 2009), p. 22ff.

57. This table and the discussion are based on Andrea D. Ellinger and Robert P. Bostrom, “An Examination of Managers’ Beliefs about Their Roles as Facilitators of Learning,” Management Learning 33, no. 2 (2002), pp. 147–179.

58. “The Business Leader as Development Coach,” PDI Portfolio (Winter 1996), p. 6; and Personnel Decisions International, http://www .personneldecisions.com (accessed May 3, 2009).

59. McKinsey & Company’s War for Talent 2000 Survey, reported in E. Michaels, H. Handfield-Jones, and B. Axelrod, The War for Talent (Boston: Harvard Business School Press, 2001), p. 100; and Mark D. Cannon and Robert Witherspoon, “Actionable Feedback: Unlocking the Power of Learning and Performance Improvement,” Academy of Management Executive 19, no. 2 (2005), pp. 120–134.

60. Jay M. Jackman and Myra H. Strober, “Fear of Feedback,” Harvard Business Review (April 2003), pp. 101–108; and Bossidy, “What Your Leader Expects of You.”

61. John C. Kunich and Richard I. Lester, “Leadership and the Art of Feedback: Feeding the Hands That Back Us,” The Journal of Leadership Studies 3, no. 4 (1996), pp. 3–22.

62. Broderick quote is from Jared Sandberg, “Avoiding Conflicts, the Too-Nice Boss Makes Matters Worse,” The Wall Street Journal (February 26, 2008), p. B1.

63. Sandberg, “Avoiding Conflicts.”

64. Based on “Closing Gaps and Improving Performance: The Basics of Coaching,” excerpt, originally published as Chapter 4 of Performance Management: Measure and Improve the Effectiveness of Your Employees (Boston, MA: Harvard Business School Press, 2006).

65. This section is based on Robert I. Sutton, “The Boss as a Human Shield,” Harvard Business Review (September 2010), pp. 106–109.

66. These examples are from Sutton, “The Boss as Human Shield.”

CHAPTER 7 FOLLOWERSHIP 221

Part 4: The Leader as a Relationship Builder

Chapter 8: Motivation and Empowerment

Chapter 9: Leadership Communication

Chapter 10: Leading Teams

Chapter 11: Developing Leadership Diversity

Chapter 12: Leadership Power and Influence

Chapter 8: Motivation and Empowerment

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Recognize and apply the difference between intrinsic and extrinsic rewards. • Appropriately tap into the motives that induce people to take action to accomplish important goals. • Motivate others by meeting their higher-level needs. • Apply needs-based theories of motivation and understand how the concept of equity applies to

motivation.

• Describe the psychological and structural elements of empowerment and how empowerment contributes to motivation.

• Apply the job characteristics model to enrich jobs. • Identify factors that play a role in employee engagement and use engagement to meet higher level

needs.

• Build a thriving workforce by giving people a sense of making progress toward meaningful goals.

CHAPTER OUTLINE 226 Leadership and Motivation

230 Needs-Based Theories of Motivation

235 Other Motivation Theories

241 Empowering People to Meet Higher Needs

245 Giving Meaning to Work through Engagement

248 New Ideas for Motivation

In the Lead

233 Paul Michaels, Mars Incorporated

244 Ralcorp

247 Cathy Lewis and Rob Devey, Prudential UK and Europe

Leader’s Self-Insight

233 Are Your Needs Met?

240 Your Approach to Motivating Others

246 Are You Engaged?

Leader’s Bookshelf

242 Drive: The Surprising Truth about What Motivates Us

Leadership at Work

251 Should, Need, Like, Love

Leadership Development: Cases for Analysis

252 Commissions for Charlotte

254 Sun Spots

J ohn Parry, CEO of Solix Inc., knew something had to be done. Solix, a business process outsourcing company, had recently been spun off from a larger company, and leaders were grappling with a number of serious problems. Employees weren’t happy, turnover was verging on 20 percent a year, and people were frequently

absent or tardy because they just didn’t want to come to work. To beat it all, Solix wasn’t making any money. As leaders considered what to do, Parry decided it might be a good idea to ask Solix’s employees. He met with each employee individually to ask what people wanted and needed to be more engaged and committed, have happier lives, and make the company more successful.

The result was that Parry threw out the company’s top-down, authoritarian management system in favor of a plan that has leaders and employees working more like partners. He ended the rigid 8.00 A.M. to 6.00 P.M. workday that required managers to be present to oversee employees. Instead, he opened the office 24 hours a day and allowed people to set their own flexible schedules. Since Parry made those decisions, employees—and the company—have blossomed. Staff turnover dropped to less than 4 percent, and employees average less than half the number of unscheduled

225 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

days off as compared to the industry average. Solix has received the Alfred P. Sloan Award for Business Excellence in Workplace Flexibility for six straight years (2007–2013) and has been named one of New Jersey’s “Best Places to Work” for four straight years. Moreover, the company’s revenues have continued to grow despite tough economic times. Committed and engaged employees who feel that they are valued by the company have made the difference. “If we trust these employees to make complex decisions on multimillion-dollar contracts,” Parry said, they can be trusted to work on their own without managers looking over their shoulders.1

Many other leaders have found that creating an environment where people feel valued and respected is a key to high motivation. This chapter explores motivation in organizations and examines how leaders can bring out the best in followers. We look at the difference between intrinsic and extrinsic rewards, examine the needs that people bring to the workplace, and discuss how leaders tap into positive or negative motives that spur people to action. Individuals have both lower and higher needs, and there are different methods of motivation to meet those needs. The chapter presents several theories of motivation, with particular attention to the differences between leadership and conventional management methods for creating a motivated workforce. The final sections of the chapter explore empowerment, employee engagement, and how leaders create a thriving workforce by enabling people to feel a sense of progress in their work.

LEADERSHIP AND MOTIVATION Most of us get up in the morning, go to school or work, and behave in ways that are predictably our own. We usually respond to our environment and the people in it with little thought as to why we work hard, invest extra time and energy in cer- tain classes, or spend our leisure time pursuing specific recreational or volunteer activities. Yet all these behaviors are motivated by something. Motivation refers to the forces either internal or external to a person that arouse enthusiasm and persis- tence to pursue a certain course of action. Employee motivation affects productiv- ity, so part of a leader’s job is to channel followers’ motivation toward the accomplishment of the organization’s vision and goals.2 The study of motivation helps leaders understand what prompts people to initiate action, what influences their choice of action, and why they persist in that action over time.

Exhibit 8.1 illustrates a simple model of human motivation. People have basic needs, such as for friendship, recognition, or monetary gain, which translate into an

EXHIBIT 8.1 A Simple Model of Motivation

Motivation the forces either internal or external to a person that arouse enthusiasm and persistence to pursue a certain course of action

226 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

internal tension that motivates specific behaviors with which to fulfill the need. To the extent that the behavior is successful, the person is rewarded when the need is satisfied. The reward also informs the person that the behavior was appropriate and can be used again in the future.

The importance of motivation, as illustrated in Exhibit 8.1, is that it can lead to behaviors that reflect high performance within organizations. Studies have found that high employee motivation and high organizational performance and profits go hand in hand.3 An extensive survey by the Gallup Organization, for example, found that when all of an organization’s employees are highly motivated and per- forming at their peak, customers are 70 percent more loyal, turnover drops by 70 percent, and profits jump 40 percent.4 Leaders can use motivation theory to help satisfy followers’ needs and simultaneously encourage high work performance. When workers are not motivated to achieve organizational goals, the fault is often with the leader.

Intrinsic and Extrinsic Rewards Rewards can be either intrinsic or extrinsic and meet both lower- and higher-level needs.5 Intrinsic rewards come from the internal satisfaction and enjoyment a person receives in the process of performing a particular action. Solving a problem to bene- fit others may fulfill a personal mission, or the completion of a complex task may bestow a pleasant feeling of accomplishment. An intrinsic reward is internal and under the control of the individual, such as to engage in task behavior to satisfy a need for competency and self-determination.

Conversely, extrinsic rewards are given by another person, typically a supervi- sor, and include promotions and pay increases. Because they originate externally as a result of pleasing others, extrinsic rewards compel individuals to engage in a task behavior for an outside source that provides what they need, such as money to survive in modern society. Think about the difference in motivation for polishing a car if it belongs to you versus if you work at a car wash. Your good feelings from making your own car shine would be intrinsic. However, buffing a car that is but one of many in a day’s work requires the extrinsic reward of a paycheck.6

Although extrinsic rewards are important, leaders work especially hard to help followers achieve intrinsic rewards. Intrinsic rewards appeal to the “higher” needs of individuals, such as for accomplishment, competence, fulfillment, and self- determination. Extrinsic rewards appeal to the “lower” needs of individuals, such as for material comfort and basic safety and security. Exhibit 8.2 outlines the dis- tinction between conventional management and leadership approaches to motiva- tion based on people’s needs. Conventional management approaches often appeal to an individual’s lower, basic needs and rely on extrinsic rewards and punishments to motivate people to behave in desired ways. These approaches are effective, but they are based on controlling the behavior of employees by manipulating their deci- sions about how to act. The higher needs of people may be unmet in favor of utiliz- ing their labor in exchange for external rewards. Under conventional management, people perform adequately to receive rewards or avoid punishments because they will not necessarily derive intrinsic satisfaction from their work.

The leadership approach strives to motivate people by providing them with the opportunity to satisfy higher needs and become intrinsically rewarded. Employees in companies that are infused with a social mission, and that find ways to enrich the lives of others, are typically more highly motivated because of the intrinsic rewards they get from helping other people.7 Leaders at any company can enable

NEW LEADER ACTION MEMO As a leader, you can provide extrinsic rewards, such as promotions, pay raises, and praise, but also help followers achieve intrinsic rewards and meet their higher-level needs for accomplishment, growth, and fulfillment.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 227

Intrinsic rewards internal satisfactions a person receives in the process of performing a particular action

Extrinsic rewards rewards given by another person, typically a supervisor, such as pay increases and promotions

people to find meaning in their work. At Morrison Management Specialists, for example, which provides food, nutrition, and dining services to the healthcare and senior living industries, leaders provide training sessions under the title of “Our Great Partnership” and strive to help people see how their jobs make a difference in the lives of elderly or ill people. A “People First” recognition program gives employees a chance to recognize one another for exceptional service.8 Remember, however, that the source of an intrinsic reward is internal to the follower. Thus, what is intrinsically rewarding to one individual may not be so to another. One way in which leaders try to enable all followers to achieve intrinsic rewards is by giving them more control over their own work and the power to affect outcomes. When leaders empower others, allowing them the freedom to determine their own actions, subordinates reward themselves intrinsically for good performance. They may become creative, innovative, and develop a greater commitment to their objectives. Thus motivated, they often achieve their best possible performance.

Ideally, work behaviors should satisfy both lower and higher needs, as well as serve the mission of the organization. Unfortunately, this is often not the case. The leader’s motivational role, then, is to create a situation that integrates the needs of people—especially higher needs—and the fundamental objectives of the organization.

Positive and Negative Motives People have both positive and negative motives that cause them to engage in specific behaviors or activities. For example, some people and corporations pay taxes to avoid the negative consequence of penalties or jail time. Others might

EXHIBIT 8.2 Needs of People and Motivation Methods

Source: Adapted from William D. Hitt, The Leader-Manager: Guidelines for Action (Columbus, OH: Battelle Press, 1988), p. 153.

228 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

pay taxes based on a positive motive of helping their communities and the larger society. Exhibit 8.3 illustrates four categories of motives based on two criteria.9

The horizontal dimension contrasts motives that are driven by fear or pain versus those driven by growth or pleasure. The vertical dimension contrasts motives that are triggered from within the individual (intrinsic) versus those triggered from outside the individual (extrinsic), such as by a leader. The four quadrants represent four differing approaches leaders can use for motivating people. Quadrants I and II are both positive approaches to motivating. Quadrant I motivational methods attempt to influence behavior by using extrinsic rewards that create pleasure, such as giving an employee a pay raise, a bonus, or a gift. At Gogobot, a travel recommendation Web site, leaders offer employees $400 of credit that they can use for travel, food, or hotels as long as they write reviews for the site.10 Many leaders are finding that small, unexpected rewards, such as gift cards, water bottles, or pizza vouchers, are highly effective extrinsic motivators. When people aren’t expecting a reward, it can have a disproportionate psychological impact.11 Extrinsic rewards are important, but good leaders don’t rely on them as their primary motiva- tional tool. Instead, they also strive to help people find meaning and joy in their work, using a Quadrant II motivational approach. Quadrant II techniques tap into deep-seated employee energy and commitment by helping people get deep personal satisfaction from their work.

Good leaders rely on positive motives as much as they can. However, negative approaches also have value. In the real world, almost every leader sometimes has to impose some form of punishment or tap into negative motives to get desired actions and results. Quadrant III uses negative, extrinsic methods, such as threats or punishments, to get people to perform as desired. For example, some companies have found that penalizing employees for smoking or being overweight by charging extra for health insurance is an effective way to change behaviors and lower company health care costs. The practice is growing, with leaders citing behavioral science research showing that people typically respond more strongly to a potential loss (a penalty for not losing weight), referred to as loss aversion, than to an

EXHIBIT 8.3 Four Categories of Motives

Source: Based on Bruce H. Jackson, “Influence Behavior: Become a Master Motivator,” Leadership Excellence (April 2010), p. 14.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 229

expected gain (a reward for losing weight). At Mohawk Industries, participation in the company’s health-risk assessment program increased 97 percent after leaders began penalizing employees $100 if they didn’t participate. Previously, the company offered rewards for participation, but enrollment rates remained low, which sparked the shift to penalties.12

The final category in Exhibit 8.3, Quadrant IV, reflects methods that attempt to motivate people by tapping into their self-doubts or anxieties, such as motivating people to work hard by emphasizing the weak economy and high unemployment rate. Fear can be a powerful motivator, but using fear to motivate people almost always has negative consequences for employee development and long-term perfor- mance. Effective leaders avoid the use of fear tactics.

NEEDS-BASED THEORIES OF MOTIVATION Needs-based theories emphasize the needs that motivate people. As illustrated ear- lier in Exhibit 8.1, needs are the source of an internal drive that motivates behavior to fulfill the needs. An individual’s needs are like a hidden catalog of the things he or she wants and will work to get. To the extent that leaders understand follower needs, they can design the reward system to direct energies and priorities toward attainment of shared goals.

Hierarchy of Needs Theory Probably the most famous needs-based theory is the one developed by Abraham Maslow.13 Maslow’s hierarchy of needs theory proposes that humans are motivated by multiple needs and those needs exist in a hierarchical order, as illustrated in Exhibit 8.4, wherein the higher needs cannot be satisfied until the lower needs are met. Maslow identified five general levels of motivating needs.

• Physiological: The most basic human physiological needs include food, water, and oxygen. In the organizational setting, these are reflected in the needs for adequate heat, air, and base salary to ensure survival.

• Safety: Next is the need for a safe and secure physical and emotional environ- ment and freedom from threats—that is, for freedom from violence and for an orderly society. In an organizational setting, safety needs reflect the needs for safe jobs, fringe benefits, and job security.

• Belongingness: People have a desire to be accepted by their peers, have friend- ships, be part of a group, and be loved. In the organization, these needs influ- ence the desire for good relationships with coworkers, participation in a work team, and a positive relationship with supervisors.

• Esteem: The need for esteem relates to the desires for a positive self-image and for attention, recognition, and appreciation from others. Within organizations, esteem needs reflect a motivation for recognition, an increase in responsibility, high status, and credit for contributions to the organization.

• Self-actualization: The highest need category, self-actualization, represents the need for self-fulfillment: developing one’s full potential, increasing one’s competence, and becoming a better person. Self-actualization needs can be met in the organization by providing people with opportunities to grow, be empowered and creative, and acquire training for challenging assignments and advancement.

230 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Hierarchy of needs theory Maslow’s theory proposes that humans are motivated by multiple needs and those needs exist in a hierarchical order

According to Maslow’s theory, physiology, safety, and belonging are deficiency needs. These lower-order needs take priority—they must be satisfied before higher- order, or growth, needs are activated. The needs are satisfied in sequence: Physio- logical needs are satisfied before safety needs, safety needs are satisfied before social needs, and so on. A person desiring physical safety will devote his or her efforts to securing a safer environment and will not be concerned with esteem or self- actualization. Once a need is satisfied, it declines in importance and the next higher need is activated. When a union wins good pay and working conditions for its members, for example, basic needs will be met and union members may then want to have social and esteem needs met in the workplace. In some Chinese factories, leaders have gone beyond financial incentives to try to meet belongingness and esteem needs of employees with work contests, American Idol–type singing contests, karaoke rooms, speed dating, dinners with managers, and more communications about the greater purpose of employees’ contributions.14

Two-Factor Theory Frederick Herzberg developed another popular needs-based theory of motivation called the two-factor theory.15 Herzberg interviewed hundreds of workers about times when they were highly motivated to work and other times when they were dissatisfied and unmotivated to work. His findings suggested that the work char- acteristics associated with dissatisfaction were quite different from those pertain- ing to satisfaction, which prompted the notion that two factors influence work motivation.

Exhibit 8.5 illustrates the two-factor theory. The center of the scale is neutral, meaning that workers are neither satisfied nor dissatisfied. Herzberg believed that

EXHIBIT 8.4 Maslow’s Hierarchy of Needs

CHAPTER 8 MOTIVATION AND EMPOWERMENT 231

two entirely separate dimensions contribute to an employee’s behavior at work. The first dimension, called hygiene factors, involves the presence or absence of job dissa- tisfiers, such as working conditions, pay, company policies, and interpersonal rela- tionships. When hygiene factors are poor, work is dissatisfying. This is similar to the concept of deficiency needs described by Maslow. Good hygiene factors remove the dissatisfaction, but they do not in themselves cause people to become highly sat- isfied and motivated in their work.

The second set of factors does influence job satisfaction. Motivators fulfill high-level needs such as needs for achievement, recognition, responsibility, and opportunity for growth. Herzberg believed that when motivators are present, workers are highly motivated and satisfied. Thus, hygiene factors and motiva- tors represent two distinct factors that influence motivation. Hygiene factors work in the area of lower-level needs, and their absence causes dissatisfaction. Inadequate pay, unsafe working conditions, or a noisy work environment will cause people to be dissatisfied, but their correction will not cause a high level of work enthusiasm and satisfaction. Higher-level motivators such as challenge, responsibility, and recognition must be in place before employees will be highly motivated. Leaders at Mars Incorporated successfully apply the two-factor the- ory to provide both hygiene factors and motivators, thus meeting employees’ higher as well as lower needs.

EXHIBIT 8.5 Herzberg’s Two-Factor Theory

NEW LEADER ACTION MEMO You can evaluate your current or a previous job according to Maslow’s needs theory and Herzberg’s two-factor theory by answering the questions in Leader’s Self-Insight 8.1.

232 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Hygiene factors the first dimension of Herzberg’s two-factor theory; involves working conditions, pay, company policies, and interpersonal relationships

Motivators the second dimension of Herzberg’s two-factor theory; involves job satisfaction and meeting higher-level needs such as achievement, rec- ognition, and opportunity for growth

IN THE LEAD Paul Michaels, Mars Incorporated President Paul Michaels and other leaders at Mars, maker of candy such as M&Ms and Snickers and pet food such as Pedigree and Whiskas, seem to meet all the need categories in terms of both hygiene factors and motivators. Mars Incorporated, the third-largest private company in the United States, is intensely secretive, but an interview by Fortune after the company was named to its “The 100 Best Companies to Work For” list for the first time in 2013 revealed some interesting tidbits.

Once people get a job there, they rarely leave, reflecting that hygiene factors such as pay and benefits are good and working relationships are solid. Compensation is very good

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C a CLEADER’S SELF-INSIGHT 8.1

Are Your Needs Met?

Instructions: Think of a specific job (current or previous) you have held. If you are a full-time student, think of your classes and study activities as your job. Please answer the following questions about those work activities. Indicate whether each item is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I feel physically safe at work. 2. I have good health benefits. 3. I am satisfied with what I’m get-

ting paid for my work. 4. I feel that my job is secure as long

as I want it. 5. I have good friends at work. 6. I have enough time away from my

work to enjoy other things in life. 7. I feel appreciated at work. 8. People at my workplace respect

me as a professional and expert in my field.

9. I feel that my job allows me to realize my full potential.

10. I feel that I am realizing my potential as an expert in my line of work.

11. I feel I’m always learning new things that help me to do my work better.

12. There is a lot of creativity involved in my work.

Scoring and Interpretation Compute the number of Mostly True responses for the ques- tions that represent each level of Maslow’s hierarchy, as indi- cated in the next column, and write your score where indicated:

Questions 1–2: Physiological and health needs. Score . Questions 3–4: Economic and safety needs. Score . Questions 5–6: Belonging and social needs. Score . Questions 7–8: Esteem needs. Score . Questions 9–12: Self-actualization needs. Score .

These five scores represent how you see your needs being met in the work situation. An average score for overall need satisfaction (all 12 questions) is typically 6, and the average for lower-level needs tends to be higher than for higher-level needs. Is that true for you? What do your five scores say about the need satisfaction in your job? Which needs are less filled for you? How would that affect your choice of a new job? In developed countries, lower needs are often taken for granted, and work motivation is based on the opportunity to meet higher needs. Compare your scores to those of another student. How does that person’s array of five scores differ from yours? Ask questions about the student’s job to help explain the difference in scores.

Reread the 12 questions. Which questions would you say are about the motivators in Herzberg’s two-factor the- ory? Which questions are about hygiene factors? Calculate the average points for the motivator questions and the aver- age points for the hygiene factor questions. What do you interpret from your scores on these two factors compared to the five levels of needs in Maslow’s hierarchy?

Source: These questions are taken from Social Indicators Research 55 (2001), pp. 241–302, “A New Measure of Quality of Work Life (QWL) based on Need Satisfaction and Spillover Theories,” M. Joseph Sirgy, David Efraty, Phillip Siegel and Dong-Jin Lee. Copyright © and reprinted with kind permission of Kluwer Academic Publishers.

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compared to similar companies. Many employees get bonuses from 10 percent to 100 percent of their salaries if their team performs well. Vending machines dispense free candy all day long, and employees in the pet food division can take their dogs to work. Employees have to punch a time clock, and their pay gets docked if they are late—but the policy applies to top executives just as it does to the lowest-level worker.

In addition to the egalitarian workplace, motivators include giving people the auton- omy to experiment and propose new ideas and recognizing them for showing initiative. Employees have great opportunities for advancement, both within their division and in the larger corporation. Leaders encourage employee growth and development. Jim Price began his career as a janitor at a Mars facility and is now the site-quality and food-safety manager at one of its chocolate plants. When he started with the company, his supervisor urged him to attend community college at night, and Mars paid for his tuition and books. Many people at Mars get a mentor to learn a new skill. Executives often get paired with younger employ- ees who introduce them to using social media. Development doesn’t stop at the factory gates, either. People can take paid time off to volunteer for community activities such as cleaning parks, planting gardens, or assisting at medical clinics. A highly competitive pro- gram selects 80 or so people each year to spend up to six weeks working with Mars-related partners (such as growers of cocoa beans) in remote areas of other countries.16

The implication of the two-factor theory for leaders is clear. People have multi- ple needs, and the leader’s role is to go beyond the removal of dissatisfiers to the use of motivators to meet higher-level needs and propel employees toward greater enthusiasm and satisfaction.

Acquired Needs Theory Another needs-based theory was developed by David McClelland. The acquired needs theory proposes that certain types of needs are acquired during an indivi- dual’s lifetime. In other words, people are not born with these needs but may learn them through their life experiences.17 For example, the parents of Bill Strick- land, who founded and runs Manchester Bidwell, a highly successful nonprofit organization that provides after-school and summer programs for at-risk young people, always encouraged him to follow his dreams. When he wanted to go south to work with the Freedom Riders in the 1960s, they supported him. His plans for tearing up the family basement and making a photography studio were met with equal enthusiasm. Strickland thus developed a need for achievement that enabled him to accomplish amazing results later in life.18 Three needs most frequently stud- ied are the need for achievement, need for affiliation, and need for power.

• Need for achievement: the desire to accomplish something difficult, attain a high standard of success, master complex tasks, and surpass others

• Need for affiliation: the desire to form close personal relationships, avoid con- flict, and establish warm friendships

• Need for power: the desire to influence or control others, be responsible for others, and have authority over others

For more than 20 years, McClelland studied human needs and their implications for management. People with a high need for achievement tend to enjoy work that is entrepreneurial and innovative. People who have a high need for affiliation are success- ful “integrators,” whose job is to coordinate the work of people and departments.19

234 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Acquired needs theory McClelland’s theory that proposes that certain types of needs (achievement, af- filiation, power) are acquired during an individual’s lifetime

Integrators include brand managers and project managers, positions that require excel- lent people skills. A high need for power is often associated with successful attainment of top levels in the organizational hierarchy. For example, McClelland studied man- agers at AT&T for 16 years and found that those with a high need for power were more likely to pursue a path of continued promotion over time.

In summary, needs-based theories focus on underlying needs that motivate how people behave. The hierarchy of needs theory, the two-factor theory, and the acquired needs theory all identify the specific needs that motivate people. Leaders can work to meet followers’ needs and hence elicit appropriate and successful work behaviors.

OTHER MOTIVATION THEORIES Three additional motivation theories—the reinforcement perspective, expectancy theory, and equity theory—focus primarily on extrinsic rewards and punishments Relying on extrinsic rewards and punishments is sometimes referred to as the carrot-and-stick approach.20 Behavior that produces a desired outcome is rewarded with a “carrot,” such as a pay raise or promotion. Conversely, undesirable or unproductive behavior brings the “stick,” such as a demotion or withholding a pay raise. Carrot-and-stick approaches tend to focus on lower needs, although higher needs can sometimes also be met. Read the story in this chapter’s Consider This to gain some perspective on the use of carrots as motivators.

Consider Does the Carrot Kill Satisfaction?

A shopkeeper got tired of the noise of a group of children who played outside his store every afternoon. One day, he asked them to leave and promised he’d give each of them $1 to come back and play there the next day. Of course, they showed up. Then the shopkeeper said he would give each one 50 cents to come back the following day. The next day he offered 25 cents for them to return. At that point, the children said they wouldn’t be back the following day because it wasn’t worth it for a quarter. The shopkeeper got what he wanted by shifting the children’s motivation for playing there toward earning an extrinsic reward rather than for the intrinsic pleasure they originally received.

The moral of the story is that the motivation to seek an extrinsic reward, whether it’s a bonus or professional approval, leads people to focus on the reward rather than on the intrinsic satisfaction they get from their activities. Extrinsic rewards are temporary. They typi- cally address lower-level needs and focus people on immediate goals and deadlines rather than long-term success and happiness.

Sources: Several variations of this familiar story have been told in different sources, including Vincent F. Filak and Robert S. Pritchard, “Fulfilling Psychological vs. Financial Needs: The Effect of Extrinsic Rewards on Motivation and Attachment to Internships,” presented in the Public Relations Division in the Association for Education in Journalism and Mass Communication Conference, August 2008, Chicago, http://citation.allacademic.com/meta /p_mla_apa_research_citation/2/7/2/3/1/pages272318/p272318-9.php (accessed April 20, 2013); Samuel S. Franklin, The Psychology of Happiness: A Good Human Life (New York: Cambridge University Press, 2010), pp. 61–62; and Alfie Kohn, Punished by Rewards: The Trouble with Gold Stars, Incentive Plans, A’s, Praise, and Other Bribes (Boston: Houghton Mifflin, 1999).

NEW LEADER ACTION MEMO As a leader, you can use good working conditions, satisfactory pay, and comfortable relation- ships to reduce job dissatis- faction. To spur greater follower satisfaction and en- thusiasm, you can employ motivators—challenge, re- sponsibility, and recognition.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 235

Reinforcement Perspective on Motivation The reinforcement approach to employee motivation sidesteps the deeper issue of employee needs described in the needs-based theories. Reinforcement theory simply looks at the relationship between behavior and its consequences by changing or modifying followers’ on-the-job behavior through the appropriate use of immediate rewards or punishments.

Behavior modification is the name given to the set of techniques by which rein- forcement theory is used to modify behavior.21 The basic assumption underlying behavior modification is the law of effect, which states that positively reinforced behavior tends to be repeated, and behavior that is not reinforced tends not to be repeated. Reinforcement is defined as anything that causes a certain behavior to be repeated or inhibited. Four ways in which leaders use reinforcement to modify or shape employee behavior are positive reinforcement, negative reinforcement, pun- ishment, and extinction, as illustrated in Exhibit 8.6.

Positive reinforcement is the administration of a pleasant and rewarding conse- quence immediately following a desired behavior. A good example of positive rein- forcement is immediate praise for an employee who does a little extra in his or her work. Studies have shown that positive reinforcement does help to improve perfor- mance. In addition, nonfinancial reinforcements such as positive feedback, social recognition, and attention are just as effective as financial rewards.22 A recent study of employees at a fine dining restaurant, for example, found that when lea- ders provided clear tasks and clear feedback on how well people were performing the tasks, motivation and performance improved. Cleaning and sanitizing of tables, chairs, floors, and restrooms increased by 63 percent and restocking of side stations

EXHIBIT 8.6 Shaping Behavior with Reinforcement

Source: Based on Richard L. Daft and Richard M. Steers, Organizations: A Micro/Macro Approach (Glenview, IL: Scott, Foresman, 1986) p. 109.

Reinforcement theory a motivational theory that looks at the relationship be- tween behavior and its con- sequences by changing or modifying followers’ on- the-job behavior through the appropriate use of immediate rewards or punishments

Behavior modification the set of techniques by which reinforcement theory is used to modify behavior

Law of effect states that positively rein- forced behavior tends to be repeated and behavior that is not reinforced tends not to be repeated

Reinforcement anything that causes a certain behavior to be repeated or inhibited

Positive reinforcement the administration of a pleas- ant and rewarding conse- quence following a behavior

236 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

increased by 48 percent.23 Supervisor attention and feedback provide a psychologi- cal boost to motivation that has nothing to do with financial rewards.

In fact, many people consider factors other than money to be more impor- tant. In a McKinsey global survey on the motivational value of money, respon- dents rated “praise and commendation from their immediate supervisor” as being a more effective motivator than cash.24 Unexpected praise or expressions of appreciation can give a tremendous motivational boost. Indra Nooyi, CEO of PepsiCo, sends thank-you notes not only to members of her team who do well but also to their spouses and parents.25 Globoforce’s most recent MoodTracker Survey found that 82 percent of employees said being recognized for their efforts increased their motivation. “It made me work harder, want to come to work every day, and I was proud to work for my boss,” said one respondent. However, only 65 percent of companies surveyed have employee recognition pro- grams, and 41 percent of employees said they hadn’t been recognized for a period of at least six months.26

Negative reinforcement, sometimes referred to as avoidance learning, is the pro- cess of withdrawing an unpleasant consequence once a behavior is improved, thereby encouraging and strengthening the desired behavior. The idea is that people will change a specific behavior to avoid the undesired result that behavior provokes. As a simple example, a supervisor who constantly reminds or nags an employee who is goofing off on the factory floor and stops the nagging when the employee stops goofing off is using negative reinforcement.

Punishment is the imposition of unpleasant outcomes on an employee in order to discourage and weaken an undesirable behavior. An example of punishment is when the board of JPMorgan Chase cut CEO Jamie Dimon’s 2012 bonus by 50 percent because of oversight failures that led to a multibillion-dollar trading loss related to the so-called “London Whale” fiasco. The punishment is intended to prevent the CEO from relying too heavily on what he is told by senior managers, and instead to seek evidence and corroboration of prudent trading behaviors.27

The use of punishment in organizations is controversial and sometimes criticized for failing to indicate the correct behavior.

Extinction is the withholding of something positive, such as leader attention, praise, or pay raises. With extinction, undesirable behavior is essentially ignored. The idea is that behavior that is not reinforced with positive attention and rewards will gradually disappear. A New York Times reporter wrote a humorous article about how she learned to stop nagging and instead use reinforcement theory to shape her husband’s behavior after studying how professionals train animals.28

When her husband did something she liked, such as throw a dirty shirt in the ham- per, she would use positive reinforcement, thanking him or giving him a hug and a kiss. Undesirable behaviors, such as throwing dirty clothes on the floor, on the other hand, were simply ignored, applying the principle of extinction.

Leaders can apply reinforcement theory to influence the behavior of followers. They can reinforce behavior after each and every occurrence, which is referred to as continuous reinforcement, or they can choose to reinforce behavior intermittently, which is referred to as partial reinforcement. With partial reinforcement, the desired behavior is reinforced often enough to make the employee believe the behavior is worth repeating, even though it is not rewarded every time it is demonstrated. Con- tinuous reinforcement can be very effective for establishing new behaviors, but research has found that partial reinforcement is more effective for maintaining behavior over extended time periods.29

Nothing else can quite substi- tute for a few well-chosen, well- timed, sincere words of praise. They’re absolutely free—and worth a fortune. Sam Walton, founder of Walmart

NEW LEADER ACTION MEMO As a leader, you can change follower behavior through the appropriate use of rewards and punishments. To establish new behaviors quickly, you can re- inforce the desired behavior after each and every occur- rence. To sustain the behaviors over a long time period, try reinforcing the behaviors intermittently.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 237

Negative reinforcement the withdrawal of an un- pleasant consequence once a behavior is improved

Punishment the imposition of unpleasant outcomes on an employee following undesirable behavior

Extinction the withdrawal of a positive reward, meaning that be- havior is no longer rein- forced and hence is less likely to occur in the future

Expectancy Theory Expectancy theory suggests that motivation depends on individuals’ mental expecta- tions about their ability to perform tasks and receive desired rewards. Expectancy theory is associated with the work of Victor Vroom, although a number of scholars have made contributions in this area.30 Expectancy theory is concerned not with understanding types of needs but with the thinking process that individuals use to achieve rewards.

Expectancy theory is based on the relationship among the individual’s effort, the possibility of high performance, and the desirability of outcomes following high performance. Exhibit 8.7 illustrates these elements and the relationships among them. The E P expectancy is the probability that putting effort into a task will lead to high performance. For this expectancy to be high, the individual must have the ability, previous experience, and necessary tools, information, and opportunity to perform. One interesting study of expectancy theory looked at patrol officer drug arrests in the midwestern United States. The research found that officers who made the most arrests were those who received specialized train- ing to hone their skills and perceived that they had sufficient time and resources to properly investigate suspected drug activity.31

The P O expectancy involves whether successful performance will lead to the desired outcome. If this expectancy is high, the individual will be more highly moti- vated. Valence refers to the value of outcomes to the individual. If the outcomes that are available from high effort and good performance are not valued by an employee, motivation will be low. Likewise, if outcomes have a high value, motiva- tion will be higher. A simple example to illustrate the relationships in Exhibit 8.7 is

EXHIBIT 8.7 Key Elements of Expectancy Theory

Expectancy theory a theory that suggests that motivation depends on in- dividuals’ mental expecta- tions about their ability to perform tasks and receive desired rewards

NEW LEADER ACTION MEMO Expectancy theory and rein- forcement theory are widely used in all types of organiza- tions and leadership situations. The questionnaire in Leader’s Self-Insight 8.2 gives you the opportunity to see how effec- tively you apply these motiva- tional ideas in your own leadership.

238 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Alfredo Torres, a salesperson at Diamond Gift Shop. If Alfredo believes that increased selling effort will lead to higher personal sales, his E P expectancy would be considered high. Moreover, if he also believes that higher personal sales will lead to a promotion or pay raise, the P O expectancy is also high. Finally, if Alfredo places a high value on the promotion or pay raise, valence is high and he will be highly motivated. For an employee to be highly motivated, all three factors in the expectancy model must be high.32

Like the path–goal theory of leadership described in Chapter 3, expectancy the- ory is personalized to subordinates’ needs and goals. Every person is different, so leaders have to use a mix of incentives and rewards to motivate. A leader’s respon- sibility is to understand each follower’s “unique motivational profile” and then help followers meet their needs while attaining organizational goals.33

According to expectancy theory, leaders enhance motivation by increasing fol- lowers’ expectancy—clarifying individual needs, providing the desired outcomes, and ensuring that individuals have the ability and support needed to perform well and attain their desired outcomes.

Equity Theory Sometimes employees’ motivation is affected not only by their expectancies and the rewards they receive but also by their perceptions of how fairly they are trea- ted in relation to others. Equity theory proposes that people are motivated to seek social equity in the rewards they receive for performance.34 According to the theory, if people perceive their rewards as equal to what others receive for similar contributions, they will believe they are treated fairly and will be more highly motivated. When they believe they are not being treated fairly and equita- bly, motivation will decline. Samantha Eckerd was told that she would have to move to a new job position to make more money at her financial services com- pany, but after she changed jobs the company hired someone for her previous job at a much higher salary than Eckerd had made in that position. The sense of unfairness created so much anger and stress that Eckerd’s performance and willingness to collaborate with others suffered and she considered looking for a new job.35

People evaluate equity by a ratio of inputs to outcomes. That is, employees make comparisons of what they put into a job and the rewards they receive relative to those of other people in the organization. Inputs include such things as educa- tion, experience, effort, and ability. Outcomes include pay, recognition, promo- tions, and other rewards. A state of equity exists whenever the ratio of one person’s outcomes to inputs equals the ratio of others’ in the work group. Inequity occurs when the input/outcome ratios are out of balance, such as when an employee with a high level of experience and ability receives the same salary as a new, less- educated employee.

Some companies are sharing hiring and promotion decisions, performance appraisal data, and individual employees’ pay rates with everyone in the com- pany, saying it creates trust and keeps people from worrying about inequity. Others, though, say too much openness creates more problems. Slava Akhmechet, CEO and cofounder of database firm RethinkDB, experimented with open pay but ran into problems when he needed to hire new technical employees in a tight labor market. Akhmechet found that he needed to offer the newcomers higher salaries than current employees were making. Long-time employees began

NEW LEADER ACTION MEMO As a leader, you can clarify the rewards a follower desires and ensure that he or she has the knowledge, skills, resources, and support to perform and obtain the desired rewards. You can keep in mind that perceived equity or inequity in rewards also influences motivation.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 239

Equity theory a theory that proposes that people are motivated to seek social equity in the rewards they receive for performance

demanding more pay, and in some cases motivation, performance, and commitment declined significantly if the demands were not met because people felt treated unfairly. Akhmechet eventually shelved the open salary model.36

This discussion provides only a brief overview of equity theory. The theory’s practical use has been criticized because a number of key issues are unclear. However, the important point of equity theory is that, for many people, motivation is influenced significantly by relative as well as absolute rewards. The concept reminds leaders that they should be cognizant of the possible effects of perceived inequity on follower motivation and performance.

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C a CLEADER’S SELF-INSIGHT 8.2

Your Approach to Motivating Others

Instructions: Think about situations in which you were in a formal or informal leadership role in a group or organization. Imagine using your personal approach as a leader, and answer the following questions. Indicate whether each item is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I ask the other person what rewards they value for high performance.

2. I find out if the person has the ability to do what needs to be done.

3. I explain exactly what needs to be done for the person I’m trying to motivate.

4. Before giving somebody a reward, I find out what would appeal to that person.

5. I negotiate what people will receive if they accomplish the goal.

6. I make sure people have the ability to achieve performance targets.

7. I give special recognition when others’ work is very good.

8. I only reward people if their per- formance is up to standard.

9. I use a variety of rewards to rein- force exceptional performance.

10. I generously praise people who perform well.

11. I promptly commend others when they do a better-than- average job.

12. I publicly compliment others when they do outstanding work.

Scoring and Interpretation These questions represent two related aspects of motiva- tion theory. For the aspect of expectancy theory, sum the points for Mostly True to questions 1–6. For the aspect of reinforcement theory, sum the points for Mostly True for questions 7–12.

The scores for my approach to motivation are:

My use of expectancy theory: My use of reinforcement theory:

These two scores represent how you see yourself applying the motivational concepts of expectancy and rein- forcement in your own leadership style. Four or more points on expectancy theory means you motivate people by manag- ing expectations. You understand how a person’s effort leads to performance and make sure that high performance leads to valued rewards. Four or more points for reinforce- ment theory means that you attempt to modify people’s behavior in a positive direction with frequent and prompt positive reinforcement. New managers often learn to use reinforcements first, and as they gain more experience they are able to apply expectancy theory.

Exchange information about your scores with other students to understand how your application of these two motivation theories compares to other students. Remember, leaders are expected to master the use of these two motivation theories. If you didn’t receive an average score or higher, you can consciously do more with expectations and reinforcement when you are in a leadership position.

Sources: These questions are based on D. Whetten and K. Cameron, Developing Management Skills, 5th ed. (Upper Saddle River, NJ: Prentice Hall, 2002), pp. 302–303; and P. M. Podsakoff, S. B. Mackenzie, R. H. Moorman, and R. Fetter, “Transformational Leader Behaviors and Their Effects on Followers’ Trust in Leader, Satisfaction, and Organizational Citizenship Behaviors,” Leadership Quarterly 1, no. 2 (1990), pp. 107–142.

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EMPOWERING PEOPLE TO MEET HIGHER NEEDS Sharing everyone’s salary might not always be a good idea, but many leaders have found that sharing overall company financial data and allowing people to participate in strate- gic decision making is a great high-level motivator. Angela Lee, a support team coordi- nator at Tenmast Software (which does not share salary data), says knowing where the company stands and understanding her impact on the bottom line is “empowering.”37

Other companies are also giving employees more power, information, and authority to enable them to find greater intrinsic satisfaction. Empowerment refers to power sharing, the delegation of power or authority to subordinates in the organization.38

Empowerment can enhance motivation by meeting the higher-level needs of employees. In addition, leaders greatly benefit from the expanded capabilities that employee participation brings to the organization.39 Frontline employees often have a better understanding than do leaders of how to improve a work process, sat- isfy a customer, or solve a production problem. To empower followers, leaders pro- vide them with an understanding of how their jobs are important to the organization’s mission and performance, thereby giving them a direction within which to act freely.40 At Ritz-Carlton hotels, employees have up to $1,000 to use at their discretion to create a great customer experience. When homes in the area near the Ritz in Laguna Niguel, California, were evacuated due to risk of fires, the hotel made an exception to its “no-pets” rule. One employee anticipated the need for pet food and drove to the nearest grocery for dog and cat food, making life a little easier for harried guests who were temporarily homeless.41

The Psychological Model of Empowerment Empowerment provides strong motivation because individuals have a sense that they are in control of their work and success. Research indicates that most people have a need for self-efficacy, which is the capacity to produce results or outcomes, to feel that they are effective.42 Most people come into an organization with the desire to do a good job, and empowerment enables leaders to release the motivation already there. This chapter’s Bookshelf suggests that empowerment works because it addresses three higher-level needs that truly motivate people—the desire for mas- tery, a sense of autonomy, and the need for a driving purpose.

Five elements must be in place before employees can be truly empowered to perform their jobs effectively: information, knowledge, discretion, meaning, and rewards.43

1. Employees receive information about company performance. In companies where employees are fully empowered, as at Tenmast Software, described ear- lier, everyone is taught to think like a business owner. Employees have access to company financials and attend a financial literacy course to understand how to interpret them.44

2. Employees receive knowledge and skills to contribute to company goals. Compa- nies use training programs and other development tools to give people the knowl- edge and skills they need to personally contribute to performance. For example, when DMC, which makes pet supplies, gave employee teams the authority and responsibility for assembly line shutdowns, it provided extensive training.45

3. Employees have the power to make substantive decisions. Empowered employ- ees have the authority to directly influence work procedures and organizational direction, such as through quality circles and self-directed work teams. At BHP

To see whether you have felt empowered in a job you have held, log in to CengageNOW

to complete the interactive questionnaire.

NEW LEADER ACTION MEMO As a leader, you can give employees greater power and authority to help meet higher motivational needs. You can implement empowerment by providing the five elements of information, knowledge, dis- cretion, significance, and rewards.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 241

Empowerment power sharing; the delega- tion of power or authority to subordinates in the organization

Copper Metals in San Manuel, Arizona, teams of tank house workers identify and solve production problems and determine how best to organize themselves to get the job done.46

4. Employees understand the meaning and impact of their jobs. Empowered employees consider their jobs important and meaningful, see themselves as capable and influential, and recognize the impact their work has on customers, other stakeholders, and the organization’s success.47

5. Employees are rewarded based on company performance. Reward systems play an important role in supporting empowerment. People are rewarded based on results shown in the company’s bottom line. Insurer Aflac has a profit-sharing program for all employees, from call center personnel to top leaders.48

Job Design for Empowerment Leaders can also adjust structural aspects of jobs to enable employees to have more autonomy and feel a sense of meaningfulness and empowerment in their jobs. Job design refers to structuring jobs in a way to meet higher-level needs and increase motivation toward the accomplishment of goals. One model, called the job characteristics model,

LEADER’S BOOKSHELF Drive: The Surprising Truth About What Motivates Us

by Daniel H. Pink

Despite much evidence to the contrary, many people still think giving employ- ees more money or other extrinsic rewards is the best way to motivate them. Certainly it is important to pay people well and pay them fairly, but in Drive: The Surprising Truth About What Motivates Us, Daniel Pink provides more fuel for the argument that money is not the best source of increased motivation.

TYPE I AND TYPE X Pink defines two types of people. Type X (Extrinsic) people are driven by external factors, such as money, fame, status, and so forth. For Type I (Intrinsic) people, on the other hand, motivation comes from within, such as the feeling of accomplish- ment when doing something meaningful or the joy one feels in doing a job to the best of one’s ability. Pink suggests that the natural human inclination is toward Type I, but organizations that focus on extrinsic rewards often turn us into Type X people. Extrinsic rewards could be effective, he says, when most people were doing rou- tine, mechanical, repetitive tasks, but

much of today’s work is more complex, creative, and knowledge-based. For this, leaders need a new approach.

HOW TO MOTIVATE NOW: PROVIDE A MAP Too much focus on extrinsic rewards can kill intrinsic satisfaction. Pink says leaders can enhance motivation by pro- viding three critical conditions.

• Mastery. “We have an innate desire to grow and develop—to become really good at something,” Pink asserts. Mastery leads to a sense of personal fulfillment. Leaders encour- age mastery when they give people time to learn and stretch themselves and when they provide feedback that enables employees to improve. Unfortunately, the modern work- place is “one of the most feedback- deprived places in American civiliza- tion,” he says.

• Autonomy. Perceived control is an important component of one’s happi- ness and well-being. Leaders should set goals, provide the tools and

resources people need, and then give people discretion over how they accomplish the goals. Zappos, for example, has no scripts for call center employees, does not monitor calls, and lets people decide for them- selves how to handle complaints.

• Purpose. For people to be moti- vated, they need to work toward an inspiring purpose. Enriching shareholders isn’t going to make most people want to get out of bed in the morning, much less give their best at work. Leaders define a purpose that employees can believe in and want to be a part of.

The last section of Drive provides a toolkit with specific tips and techniques for implementing the principles in the real world of organizations. Money and other extrinsic rewards have their place, but for Pink, “the best use of money as a motivator is to pay people enough to take the issue of money off the table.”

Source: Drive, by Daniel H. Pink, is published by Riverhead Books/Penguin Group.

Job design structuring jobs in a way to meet higher level needs and increase motivation toward the accomplishment of goals

Job characteristics model a model of job design that considers the core job di- mensions of skill variety, task identity, task significance, autonomy, and feedback to enrich jobs and increase their motivational potential

242 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

proposes that certain core job dimensions create positive psychological reactions within employees that lead to higher motivation and better performance.49 The core job dimen- sions, related psychological reactions, and outcomes are illustrated in Exhibit 8.8.

Leaders can make alterations in five dimensions of jobs to increase the job’s motivational and empowerment potential.

1. Increase skill variety. Jobs with a variety of activities require a diversity of skills and are thus more motivating.

2. Structure jobs so that an employee can perform a complete task from beginning to end. The job characteristics model refers to this as task identity, which means the job has a recognizable beginning and ending.

3. Incorporate task significance into the job. People feel an increased sense of power and self-efficacy when they are performing a job that is important and that influ- ences customers and the company’s success. At The Nerdery, a Web development firm, leaders gave all employees the job title of co-president, which increases task significance for every job because it gives everyone both the freedom and the responsibility to do what is best for customers and the company.50

4. Give people autonomy for choosing how and when to perform specific tasks. People are typically more motivated when they have freedom, discretion, and self-determination in planning and carrying out tasks.

5. To the extent possible, design jobs to provide feedback and let employees see the outcomes of their efforts. In cases where the job itself does not provide timely feed- back, leaders have to work harder at giving people specific feedback and helping them see how the job contributes to the organization’s success. For example, James Ault spends his days researching and debating issues related to state energy policy and might never see concrete results of his work. Consequently, Ault sometimes finds it difficult to get gratification from his job. “It would be nice to be an electri- cian,” he says. “You can take pride in what you’ve accomplished.”51

The more these five characteristics can be designed into the job, the higher employ- ees’ motivation will be, and the higher will be their performance. Essentially, these

EXHIBIT 8.8 The Job Characteristics Model

Source: Adapted from J. Richard Hackman and G.R. Oldham, “Motivation through the Design of Work: Test of a Theory,” Organizational Behavior and Human Performance 16 (1976), p. 256.

To evaluate a job according to the job characteristics model, log in to CengageNOW

to complete the interactive questionnaire.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 243

changes are designed to transfer authority and responsibility from leaders to employees and create job enrichment. Job enrichment incorporates high-level moti- vators such as responsibility, recognition, and opportunities for growth and learn- ing into the job. In an enriched job, the employee controls resources needed to perform well and makes decisions on how to do the work.

The following example describes how leaders at Ralcorp’s cereal manufacturing plant in Sparks, Nevada, used job design to enhance employee empowerment.

IN THE LEAD Ralcorp One way to enrich an oversimplified job is to enlarge it, that is, to extend the responsibility to cover several tasks instead of only one. At Ralcorp’s cereal manufacturing plant, leaders combined several packing positions into a single job and cross-trained employees to oper- ate all of the packing line’s equipment. Employees were given both the ability and the responsibility to perform all the various functions in their department, not just a single task.

In addition, line employees became responsible for all screening and interviewing of new hires as well as training and advising one another. They also manage the production flow to and from their upstream and downstream partners—they understand the entire production process so they can see how their work affects the quality and productivity of employees in other departments and the success of the company. Ralcorp invests heavily in training to be sure employees have the needed operational skills as well as the ability to make decisions, solve problems, manage quality, and contribute to continuous improvement.52

Leaders at Ralcorp applied elements of job design to enrich jobs, which has improved employee motivation and satisfaction. The company has benefited from higher long-term productivity, reduced costs, and happier employees.

As illustrated in Exhibit 8.8, the five core job dimensions cause individuals to experience three positive psychological reactions. The first three dimensions— higher skill variety, task identity, and task significance—enable the employee to see the job as meaningful and significant (experienced meaningfulness of work), which makes the job intrinsically satisfying. Greater autonomy in a job leads to a feeling of increased responsibility for the success or failure of task outcomes (expe- rienced responsibility for outcomes of the work), thus increasing commitment. The final dimension, feedback, provides the employee with knowledge of the actual results of work activities. Thus, the employee knows how he or she is doing and can adjust work performance to increase desired outcomes.

These positive psychological reactions in turn lead to greater intrinsic satisfac- tion, higher motivation, better work performance, and lower absenteeism and turn- over, as illustrated in the exhibit.

Empowerment Applications Current methods of empowering employees can be classified based on two dimensions: (1) the extent to which employees are involved in defining desired outcomes; and (2) the extent to which they participate in determining how to achieve those outcomes. Exhibit 8.9 shows that empowerment efforts range from a situation where frontline

244 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Job enrichment a motivational approach that incorporates high-level mo- tivators into the work, in- cluding job responsibility, recognition, and opportu- nities for growth, learning, and achievement

employees have no discretion (such as on a traditional assembly line) to full empower- ment where workers even participate in formulating organizational strategy.53

When employees are fully empowered, they are involved in defining mission and goals as well as in determining how to achieve them. One organization that has moved to this high level of empowerment is Hilcorp Energy, the nation’s fourth-largest private producer of onshore crude oil and natural gas, based in Houston, Texas. Hilcorp, which takes over holes abandoned by the big energy companies and produces about 25 million barrels of oil and gas a year from them, was started by three guys with nothing but a telephone in 1989 and has grown to more than 600 employees (called associates). Managers attribute the company’s success to the people on the front lines. Because managers put decision-making power is in the hands of associates, those people need full information to make good choices, so all financial and operating information is openly shared. Associ- ates at Hilcorp are also rewarded based on company performance. Associates can earn bonuses of up to 60 percent of their annual salaries based on meeting perfor- mance goals. In addition, they can choose to purchase an economic stake in one of Hilcorp’s reclamation projects. At Hilcorp, employees truly do feel like owners.54

GIVING MEANING TO WORK THROUGH ENGAGEMENT The most recent thinking about motivation considers what factors contribute to people’s willingness to be fully engaged at work and “go the extra mile” to con- tribute their creativity, energy, and passion on the job. One approach is to foster

EXHIBIT 8.9 Degrees of Empowerment

CHAPTER 8 MOTIVATION AND EMPOWERMENT 245

an organizational environment that helps people find true value and meaning in their work.

One path to meaning is through employee engagement. Engagement means that people enjoy their jobs and are satisfied with their work conditions, contribute enthusiastically to meeting team and organizational goals, and feel a sense of belonging and commitment to the organization. Fully engaged employees care deeply about the organization and actively seek ways to serve the mission.55 Recent research shows that only 30 percent of American workers feel engaged in their jobs.56 Research has also shown that company performance and profitability improve as the engagement level of employees increases.57 In addition, according to Gallup Organization research, engaged employees have 51 percent lower turn- over, 27 percent less absenteeism, and 18 percent more productivity.58 Internet retailer Zappos takes engagement so seriously that it pays people to quit if they

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 8.3

Are You Engaged?

Instructions: Think about one of your favorite college courses that you enjoyed and in which you performed well. Answer the questions below for that favorite course. Then respond to the items in Part B below for a course you did not enjoy and for which you probably performed poorly. Respond to the items in both Part A and Part B by indicating whether each item is Mostly True or Mostly False for you.

Mostly False

Mostly True

Part A (for a favorite course)

1. I made sure to study on a regular basis.

2. I put forth a lot of effort. 3. I found ways to make the course

material relevant to my life. 4. I found ways to make the course

interesting to me. 5. I raised my hand in class. 6. I had fun in class. 7. I participated actively in small

group discussions. 8. I helped fellow students.

Part B (for a least-favorite course)

1. I made sure to study on a regular basis.

2. I put forth a lot of effort. 3. I found ways to make the course

material relevant to my life. 4. I found ways to make the course

interesting to me.

5. I raised my hand in class.

6. I had fun in class. 7. I participated actively in small

group discussions. 8. I helped fellow students.

Scoring and Interpretation For Part A give yourself 1 point for each Mostly True answer and zero points for each Mostly False. For Part B give your- self 1 point for each Mostly True and zero points for each Mostly False. Write your scores below:

Part A score: Part B score:

The term “employee engagement” is very popular in the cor- porate world. Engagement means that people are highly involved in and express themselves through their work, going well beyond the minimum effort required to do their jobs. Engagement typically has a positive relationship with both personal satisfaction and performance. If this relation- ship was true for your classes, your score for your favorite course should be substantially higher than the score for your least favorite course. The challenge for you as a leader is to learn to engage subordinates in the same way your instruc- tor in your favorite class was able to engage you. Teaching is similar to leading. What techniques did your instructors use to engage students? Which techniques can you use to engage people when you become a leader?

Source: These questions are based on Mitchell M. Handelsman, William L. Briggs, Nora Sullivan, and Annette Towler, “A Measure of College Student Course Engagement,” The Journal of Educational Research 98 (January– February 2005), pp. 184–191.

| D re am

st im e. co m

Engagement when people enjoy their jobs and are satisfied with their work conditions, con- tribute enthusiastically to meeting team and organi- zational goals, and feel a sense of belonging and commitment to the organization

246 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

don’t feel passionate about their work. In 2011, the early-resignation bonus, known internally as “the offer,” was $4,000; leaders have experimented with the amount to make sure the right people are being weeded out.59

It is the behavior of leaders that makes the biggest difference in whether people feel engaged at work.60 A leader’s role is not to control others but to organize the workplace in such a way that each person can learn, contribute, and grow. Research- ers at the Gallup Organization developed a metric called the Q12, a list of 12 ques- tions that provides a way to evaluate how leaders are doing in creating an environment that provides intrinsic rewards by meeting higher-level needs. For exam- ple, one question on the Q12 concerns whether people have an opportunity at work to do what they do best. Recall from Chapter 2 the discussion of strengths and how each person has a unique set of talents and abilities. When people have an opportu- nity to do work that matches these natural capabilities, their satisfaction and engage- ment levels soar.61 The Q12 also evaluates characteristics such as whether employees know what is expected of them, whether they have the resources they need to per- form well, whether they feel appreciated and recognized for doing good work, whether they have a friend at work, and whether they feel that their opinions are important. The full list of questions on the Q12 survey can be found in the book First, Break All the Rules by researchers Marcus Buckingham and Curt Coffman.62

When a majority of employees can answer the Q12 questions positively, the organi- zation enjoys a highly motivated, engaged, and productive workforce.

Leaders can identify the level of engagement in their organizations and imple- ment strategies to facilitate full engagement and improve performance. Consider the following example from Prudential UK and Europe, which provides life insurance and pensions for around seven million customers.

IN THE LEAD Cathy Lewis and Rob Devey, Prudential UK and Europe Like other companies in the financial services industry, Prudential UK and Europe (Pru UK) is operating in a highly turbulent environment that has been wracked further by the global economic crisis and scandals in the financial industry. “It is very difficult for both consumers and organizations to know what to do,” said Cathy Lewis, Pru UK’s director of human resources.

Lewis, Pru UK CEO Rob Devey, and other top leaders decided to focus on improving employee engagement and being seen as a great employer. The first step was a survey to gather data on what employees themselves thought would make a difference. Leaders set up an engagement board made up of senior staff from each part of the business to analyze the survey findings and identify themes that were the main drivers of engagement. One of the findings was that line managers were not living up to the ideal of empowerment the company desired. Top executives redefined roles for line managers and had to reassign some who couldn’t make the shift. “It was quite painful,” said customer services director Tracy Harris, but it allowed top leaders to let managers run their own departments as if they were their own small businesses. Another finding was the importance of leaders being visible, especially to staff based in locations far away from headquarters (the company has locations in London, Reading, Scotland, Dublin, and Mumbai).

The engagement board wrote a six-chapter “story” examining the history of Pru UK, the challenges it faces, the actions desired to address the challenges, and how employees fit in.

NEW LEADER ACTION MEMO Take the quiz in Leader’s Self- Insight 8.3 to evaluate your level of engagement for a college course you enjoyed compared to one you did not enjoy.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 247

The story was delivered via multiple communication channels, including senior leaders going to every location. Senior leaders have also begun writing weekly blogs, including notes about people who have made significant contributions or received awards. “It’s a little thing, but our people love it,” Lewis says. One reason is that it encourages and enables close connections among employees. “These actions,” says Devey, “are about showing you care and giving permission for people to take the lead with their own initiatives.” The sense of community has increased tremendously, with local offices planning events such as Christmas fairs, family days, or special informational breakfasts.

When the engagement survey was conducted a year later, it showed that both engagement (whether people felt enough a part of the organization to “go the extra mile”) and enablement (whether they felt they had the resources and autonomy to do their jobs well) had strongly increased.63

Although the results of the follow-up survey at Pru UK were overwhelmingly positive and “a source of pride,” leaders say that doesn’t mean their job is done. “Keep asking, keep talking,” says Lewis. It is “the people in the organization who know what will make the difference.”64

NEW IDEAS FOR MOTIVATION One reason engagement and empowerment have such high motivational potential is that they address higher level needs and provide intrinsic rewards by applying some recent ideas about what it takes to have a high-performance workplace in which people feel that they are a part of something special.

The Making Progress Principle Recent research points to the importance of making progress toward goals as a key to high motivation. The making progress principle is the idea that the single most important factor that can boost motivation, positive emotions, and percep- tions during a workday is making progress toward meaningful goals.65 People are most motivated when they have the opportunity to experience achievement. Knowing that they are making everyday progress, even small steps, can make all the difference in how motivated people feel to continue pursuing a course of action.

Leaders can support making progress by setting clear goals, giving people autonomy, providing sufficient time and resources, and helping people see how they are contributing. In addition, leader encouragement and recognition can enable people to see their work as important and meaningful. Providing feedback on how well people are progressing and giving them a way to track their progress toward goals provides a renewable energy that fuels motivation. Sometimes managers underestimate the importance of the continuous feedback aspect of the job charac- teristics model, described earlier.

Building a Thriving Workforce Taken together, many of the ideas in this chapter enable leaders to create an envi- ronment in which people can thrive. A thriving workforce is one in which people are

NEW LEADER ACTION MEMO As a leader, you can build an environment that unleashes employee potential and allows people to become engaged with their work and the orga- nization. You can help people feel good about their jobs by giving them a sense of making progress toward meaningful goals.

248 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Making progress principle the idea that the single most important factor that can boost motivation, positive emotions, and perceptions during a workday is making progress toward meaningful goals

Thriving workforce A workforce in which people are not just satisfied and productive but also engaged in creating a better future for themselves and the organi- zation; incorporates vitality and learning

not just satisfied and productive but also engaged in creating the future—their own and that of the organization.66 Two components of thriving individuals are vitality and learning. A thriving employee is one who feels alive, energized, and passionate about what he or she is doing. The individual has a sense that his or her work has purpose and meaning. In addition, a thriving employee is one who is learning and growing, developing new knowledge, skills, and abilities that can be applied now and in the future.

Leaders promote thriving by applying many of the motivational techniques described throughout this chapter, such as meeting higher level needs, helping peo- ple get intrinsic rewards from their work, and providing regular feedback on perfor- mance and progress. A long-term commitment to empowerment and engagement can provide the basis for a thriving workplace. The goal of empowerment and engagement is to transform the culture. Leaders talk with people one on one to understand what each individual wants and needs to feel engaged and empowered, and then follow through with everyday action. Although there are some key dri- vers, there is no cookie-cutter approach because each individual and organization is different.67 As described earlier, the immediate supervisor plays a key role in whether employees are engaged and thriving.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • This chapter introduced a number of important ideas about motivating people

in organizations. Individuals are motivated to act by various motives and to satisfy a range of needs. The leadership approach to motivation tends to focus on positive motives and meeting the higher needs of employees. The role of the leader is to create a situation in which followers’ higher needs and the needs of the organization can be met simultaneously.

• Needs-based theories focus on the underlying needs that motivate how people behave. Maslow’s hierarchy of needs proposes that individuals satisfy lower needs before they move on to higher needs. Herzberg’s two-factor theory holds that dissatisfiers must be removed and motivators then added to cause high motivation. McClelland asserted that people are motivated differently depending on which needs they have acquired.

• Other motivation theories, including the reinforcement perspective, expec- tancy theory, and equity theory, focus primarily on extrinsic rewards and punishments, sometimes called carrot-and-stick methods of motivation. The reinforcement perspective proposes that behavior can be modified by the use of rewards and punishments. Expectancy theory is based on the idea that a person’s motivation is contingent upon his or her expectations that a given behavior will result in desired rewards. Equity theory proposes that individuals’ motivation is affected not only by the rewards they receive but also by their perceptions of how fairly they are treated in relation to others. People are motivated to seek equity in the rewards they receive for performance.

• A highly effective way to meet higher level needs is to empower employees. Empowerment lets subordinates know the direction of the organization and

Tw itt er

CHAPTER 8 MOTIVATION AND EMPOWERMENT 249

gives them the autonomy to act as they see fit to go in that direction. Leaders provide employees with the knowledge to contribute to the organization, the power to make consequential decisions, and the necessary resources to do their jobs.

• Jobs can be designed to increase empowerment. The job characteristics model proposes that jobs are more empowering and motivating when they have greater skill variety, task identity, task importance, autonomy, and feedback.

• Employee engagement is tied to the trend toward helping employees find value and meaning in their jobs. The most motivated employees are engaged employ- ees who enjoy their jobs and feel they are making a valuable contribution. Engaged employees contribute enthusiastically to meeting goals. Leaders create the environment that determines employee engagement.

• Two recent motivational ideas that relate to engagement are the making prog- ress principle and creating a thriving workforce. Research suggests that the sin- gle most important factor for motivation is a sense of making progress toward meaningful goals. A thriving workforce is made up of people who are enthusi- astically learning and growing as they acquire new knowledge and skills to apply in their current jobs or in the future.

DISCUSSION QUESTIONS 1. Describe the kinds of needs that people bring to an organization. How might a person’s

personality characteristics such as introversion/extroversion or openness to experience, as described in Chapter 4, influence the needs he or she brings to work?

2. With the economy still in a slump, some companies are freezing pay raises or even cut- ting pay for some employees so they can offer substantial raises to people considered star performers. As a motivational technique, does this practice seem like a good one to you? What might be some disadvantages of this technique?

3. How might empowerment provide the two conditions (vitality and learning) for a thriv- ing workforce as described in the chapter? Consider both psychological factors and the job characteristics model in your answer.

4. Google wants employees to mingle more but not to waste a lot of time. So as part of its “people strategy,” Google analyzes reams of data to determine the optimal size and shape for the cafeteria tables and the best length for the lunch line. If hygiene factors, as defined in Herzberg’s two-factor theory, will not provide increased satisfaction and motivation, why do you think Google would try to increase lunchtime mingling? Discuss.

5. Why do you think making progress in meaningful work ranks as the most important factor contributing to motivation according to a recent study? How might leaders pro- vide a sense of progress for employees working on long-range projects that might not show results for months or even years?

6. One small business owner says she doesn’t offer her sales representatives incentives because people try to sabotage one another to get more business and stop paying atten- tion to smaller accounts. As a leader, how would you develop a program to motivate and reward high performers without promoting the wrong type of behavior?

7. Can you think of specific motivational techniques that would motivate you in each of the four categories in Exhibit 8.3 (positive extrinsic, positive intrinsic, negative extrinsic, negative intrinsic)? Describe them.

250 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

8. Do you agree that it is the behavior of leaders that largely determines employee engage- ment, as defined in the text? What might be some other factors that influence engagement?

9. Discuss whether you believe it is a leader’s responsibility to help people find meaning in their work. How might leaders do this for employees at a credit card call center? How about for employees who empty waste containers and clean restrooms at sports or entertainment venues?

10. As part of the federal health-care overhaul in the United States, patient satisfaction survey scores are now used to help determine how much the federal government will pay medical facilities for treating patients on Medicare. What motivation theory described in the chapter does this example illustrate? Do you think this approach will motivate employees to provide better care? What might be some potential problems with this approach?

Complete this assignment online with CengageNOW.

C a C

LEADERSHIP AT WORK Should, Need, Like, Love Think of a school or work task that you feel an obligation or commitment to complete but that you don’t really want to do. Write the task here:

Think of a school or work task you do because you need to, perhaps to get the benefit, such as money or credit. Write the task here:

Think of a school or work task you like to do because it is enjoyable or fun. Write the task here:

Think of a task you love to do—one in which you become completely absorbed and from which you feel a deep satisfaction when finished. Write the task here:

Now reflect on those four tasks and what they mean to you. How motivated (high, medium, low) are you to accomplish each of these four tasks? How much mental effort (high, medium, low) is required from you to complete each task?

CHAPTER 8 MOTIVATION AND EMPOWERMENT 251

Now estimate the percentage of your weekly tasks that you would rate as should, need, like, love. The combined estimates should total 100%.

Should: % Need: % Like: % Love: %

If your should and need percentages are substantially higher than your like and love categories, what does that mean for you? Does it mean that you are forcing yourself to do tasks you find unpleasant? Why? Why not include more like and love tasks in your life? Might you grow weary of the should and need tasks at some point and select a new focus or job in your life? Think about this and discuss your percentages with another student in the class.

Tasks you love connect you with the creative spirit of life. People who do something they love have a certain charisma, and others want to follow their lead. Tasks you like typi- cally are those that fit your gifts and talents and are tasks for which you can make a contri- bution. Tasks you do because of need are typically practical in the sense that they produce an outcome you want, and these tasks often do not provide as much satisfaction as the like and love tasks. Tasks you do strictly because you should, and which contain no love, like, or need, may be difficult and distasteful and require great effort to complete. You are unlikely to become a leader for completing should tasks.

What does the amount of each type of task in your life mean to you? How do these tasks relate to your passion and life satisfaction? Why don’t you have more like and love tasks? As a leader, how would you increase the like and love tasks for people who report to you? Be specific.

In Class: The instructor can have students talk in small groups about their percentages and what the percentages mean to them. Students can be asked how the categories of should, need, like, and love relate to the theories of motivation in the chapter. Do leaders have an obligation to guide employees toward tasks they like and love, or is it sufficient at work for people to perform need and should tasks?

The instructor can write student percentages on the board so students can see where they stand compared to the class. Students can be asked to interpret the results in terms of the amount of satisfaction they receive from various tasks. Also, are the percentages related to the students’ stage of life?

Check out CengageNOW for additional cases with interactive activities.

C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Commissions for Charlotte Doris Ann Riley, the head of HR for King Conductors, was amused by the conversation drifting over the planter that separated the two booths in the employee cafeteria. She recognized the voices on the other side as those of Pete Morris, Carter Henry, and Rachael Parker. The three were involved in a heated discussion about the opening of the NFL season one week away and the continued hold-out of the local team’s star quarterback.

“Hey, if he can hold out for a $50 million dollar contract, I say more power to him. He’s worth it,” Pete announced “I say …”

252 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

“The guy already has millions,” Rachael cut in. “He got it last year as a rookie, for hea- ven’s sake. He’s a selfish jerk. His selfishness is making everyone, the fans, the owner, prob- ably the other players, angry.”

“Yeah, and what about those other players who have been there, winning games for us for years?” Carter asked. “They get us in the play-offs year after year, and then here comes this guy who’s been there one year, one year, Pete, and he’s going to get millions or he won’t play. Well, that really breaks my heart.”

“Just be glad that Charlotte Forsythe knows nothing about American football or that you can make demands like that, or she’ll hit up this company,” Rachael remarked, breaking the tension at the table by making everyone laugh.

On the other side of the planter, Doris Ann was not laughing. Charlotte had worked for years in the international arena as the top salesperson for

rival Merrill International in the United Kingdom. A native Londoner, she followed a life-long desire to immigrate to the United States. Doris Ann was part of the team that had lured Charlotte from U.S. rival Martin Conductor to take a sales position with King Conductors (whose owners, Wylie King and James Conway, long ago hoisted the humor- ous nickname, King-Con). Capturing Charlotte was considered a real coup in the world of conductors. Long considered the big three in the industry, the companies produced in-demand conductors for electronics. King-Con’s own formulation was designed for use to counter continuous flexing in data processing, rotating servo platforms, and other applications.

To capture such a high-profile salesperson, Doris Ann was the first to admit the com- pany had given in more than usual on wage and other job perks. Charlotte had skipped the regular salary in order to receive straight commissions on sales—an arrangement that had been made by her previous employer. The arrangement was unusual but, the team thought, a necessary step in luring Charlotte away from Martin. In addition, as a native of England with the habit of driving on the left-hand side of the road, Charlotte’s unfamiliarity with American driving conditions, particularly in congested metropolitan areas, resulted in the unusual arrangement of allowing her office assistant to also serve as a driver on various occasions, particularly when she was out of town. While working in the company headquar- ters, however, she took the train to work and made use of trains or cabs. Still, there was a rumble of discontent among employees about Queen Charlotte and royal treatment.

“Her sales are a huge percentage and she’s made a tremendous difference in the year since her arrival. She really is worth the trouble,” Doris Ann told company vice president Charles Owenby. “But she has come to me to suggest raising her commission—substantially—and I just don’t know. But I think you and I and Wylie and Jim need to discuss this.”

“I agree,” Charles said. “I think they will bend within reason … ” “But the problem here, I believe, will be the reaction of other employees,” Doris Ann

said. I hear a lot about Queen Charlotte and royal treatment, and comparisons to how those who have put in the years here are not getting the same respect as the rookie, to bor- row a football analogy. So the question is, do we give in or stand firm?”

“Knowing she can always move over to Martin,” Charles added. “There’s a risk either way, so we have to explore our options before we bring all of the parties together to hash this thing out.”

QUESTIONS

1. What theories of motivation help explain Charlotte’s demands and the reactions of other employees to those demands?

2. What options can you think of for handling Charlotte’s demand for even higher com- missions? Which option would you choose? Why?

3. How might Doris Ann Riley deal with employee morale in light of the extremely high pay demanded by a star salesperson?

CHAPTER 8 MOTIVATION AND EMPOWERMENT 253

Sun Spots SunDax CEO Dax Hollandsworth turns his leather desk chair from the blinding sunlight streaming through the large office window and leans back, facing Mark Roberts, the com- pany CFO.

“You know, Mark, on the surface this seems impossible. We look at the numbers, we look at energy trends, we look at tax breaks and the grants and loans poured into this effort, and…” his voice trails off as he raises his hands in a gesture of surrender.

“I dread the quarterly meeting and video feed,” Mark says. “Everyone has been work- ing really hard and they’ve come to expect the year-end bonus. Hell, they plan for it, their families budget for it.”

“I realize this will come as a huge disappointment, but I really don’t think it will come as a big shock to them. Do you want some of these?” Dax asks, taking a handful of jelly beans and extending the jar to Mark who takes a few. “They’re working their tails off, but I’ve detected a decline in overall morale. Everyone here keeps a close eye on the industry and on the mood and efforts at the Federal level. They deal every day with the competition from the Chinese, and they see this big trend toward mergers and acquisitions. They may not want to admit it any more than we want to say it, but I think they know the bonus pool is empty and they wonder what the future holds.”

The question hanging over the offices throughout the U.S. solar industry echoes that of California-based SunDax, “how could this happen?”

To the outsider, things appear great for solar power. The numbers are staggering with an over-all increase in usage of more than 60 percent over the previous year. And American home and commercial construction shows the rising popularity of solar energy as a viable power alternative. Like the electric automobile, it is the wave of the future. But the public sees only the sun; industry insiders are looking at the sun spots.

Private investments in the early years followed by federal tax credits and Energy Depart- ment loan guarantees enabled solar companies such as SunDax to refine their products, increase inventory, and expand sales worldwide. Boom time brought U.S. Treasury grants to the industry of several hundred million dollars, and as sales increased so did employee bonuses. Many bonuses equaled up to a third of an employee’s salary—money for a child’s college tuition, down-payments on homes, trips, and other luxuries.

Now, amid shaky global economic conditions, SunDax and others see a decline in U.S. and European solar energy incentives while Chinese competitors undercut costs, providing an inventory glut for many U.S. producers. In this climate, there is reluctance on the part of Congress to renew mini-grants or to extend tax credits. The stimulus packages upon which so many companies depended to jump-start market expansion are a thing of the past.

“I’m afraid that employees will believe we are bending to public pressure in withholding their bonuses or they will think we are holding onto financial assets in order to look stronger for a potential merger or acquisition,” Dax tells Mark.

“Mergers and acquisitions are the trend right now and some big names have given in. If we are acquired, they can share in the gains.”

“We’re not there yet,” Dax says. “Our challenge is to shore up faith in our future among employees while dealing with the realities of the market. But if you say ‘look at all of these challenges’ and, ‘oh, by the way, don’t expect a year-end bonus,’ what can we offer to shore up that faith and restore enthusiasm?”

QUESTIONS

1. What options can you think of for Dax and Mark to mitigate the damage from unfilled expectations for the annual bonus?

2. What specific steps would you take if you were a senior manager in this situation? Explain why for each step.

3. Do you consider it motivational and equitable when a substantial part of an employee’s pay is a bonus based on company results in a highly uncertain environment? Why?

254 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

REFERENCES 1. Sue Shellenbarger, “C-Suite: Life/Work: Sometimes It’s the Boss Who

Gets Fed Up with Juggle,” The Wall Street Journal Europe (December 9, 2010), p. 27; “Solix, Inc.: Solix Wins Outstanding Employer Award from the New Jersey Business and Industry Association,” Mental Health Weekly Digest (October 12, 2009), p. 196; and “Solix Earns Sixth Consecutive Sloan Award for Excellence in Workplace Effectiveness and Flexibility,” Solix News Release (February 19, 2013), http://www. solixinc.com/internet/solixnews.aspx# (accessed April 12, 2013).

2. Michael West and Malcolm Patterson, “Profitable Personnel,” People Management (January 8, 1998), pp. 28–31; Richard M. Steers and Lyman W. Porter, eds. Motivation and Work Behavior, 3rd ed. (New York: Columbus, OH: McGraw-Hill, 1983); Don Hellriegel, John W. Slocum Jr., and Richard W. Woodman, Organizational Behavior, 7th ed. (St. Paul, MN: West Publishing Co., 1995), p. 170; and Jerry L. Gray and Frederick A. Starke, Organizational Behavior: Concepts and Applications, 4th ed. (New York: Macmillan, 1988), pp. 104–105.

3. Linda Grant, “Happy Workers, High Returns,” Fortune (January 12, 1998), p. 81; Elizabeth J. Hawk and Garrett J. Sheridan, “The Right Staff,” Management Review (June 1999), pp. 43–48; Anne Fisher, “Why Passion Pays,” FSB (September 2002), p. 58; and West and Patterson, “Profitable Personnel.”

4. Curt Coffman and Gabriel Gonzalez-Molina Follow This Path: How the World’s Greatest Organizations Drive Growth by Unleashing Human Potential (New York: Warner Books, 2002).

5. Richard M. Steers, Lyman W. Porter, and Gregory A. Bigley, Motivation and Leadership at Work, 6th ed. (New York: McGraw- Hill, 1996), pp. 496–498.

6. Steven Bergals, “When Money Talks, People Walk,” Inc. (May 1996), pp. 25–26.

7. Rosabeth Moss Kanter, “How to Fire Up Employees without Cash or Prizes,” Business 2.0 (June 2002), pp. 134–152.

8. This example is from Maureen Soyars and Justin Brusino, “Essentials of Engagement: Contributions, Connections, Growth,” T + D (March 2009), pp. 62–65.

9. This discussion is based on Bruce H. Jackson, “Influence Behavior; Become a Master Motivator,” Leadership Excellence (April 2010), p. 14.

10. Mohana Ravindranath, “Getting a Return on Employee Rewards,” On Small Business Blog, The Washington Post (December 19, 2012), http://www.washingtonpost.com/blogs/on-small-business/post /getting-a-return-on-employee-rewards/2012/12/18/1400a9ec-4973 -11e2-820e-17eefac2f939_blog.html (accessed April 16, 2013).

11. Susie Cranston and Scott Keller, “Increasing the ‘Meaning Quotient’ of Work,” McKinsey Quarterly (January 2013), http://www .mckinseyquarterly.com/Increasing_the_meaning_quotient_of _work_3055 (accessed April 17, 2013).

12. Leslie Kwoh, “Shape Up or Pay Up: Firms Put in New Health Penalties,” The Wall Street Journal (April 6, 2013), p. A1.

13. Abraham F. Maslow, “A Theory of Human Motivation,” Psychological Review 50 (1943), pp. 370–396.

14. Kathy Chu, “China Factories Try Karaoke, Speed Dating, to Keep Workers,” The Wall Street Journal (May 2, 2013), http://online.wsj .com/article/SB10001424127887323798104578452634075519230 .html?KEYWORDS=kathy+Chu (accessed May 13, 2013).

15. Frederick Herzberg, “One More Time: How Do You Motivate Employees?” Harvard Business Review (January–February 1968), pp. 53–62.

16. David A. Kaplan, “Inside Mars,” Fortune (February 4, 2013), pp. 72–82.

17. David C. McClelland, Human Motivation (Glenview, IL: New York: Scott, Foresman, 1985).

18. John Brant, “What One Man Can Do,” Inc. (September 2005), pp. 145–153.

19. David C. McClelland, “The Two Faces of Power,” in D. A. Colb, I. M. Rubin, and J. M. McIntyre, eds., Organizational Psychology (Upper Saddle River, NJ: Prentice Hall, 1971), pp. 73–86.

20. Alfie Kohn, “Why Incentive Plans Cannot Work,” Harvard Business Review (September–October 1993), pp. 54–63; A. J. Vogl, “Carrots, Sticks, and Self-Deception” (an interview with Alfie Kohn), Across the Board (January 1994), pp. 39–44; and Alfie Kohn, “Challenging Behaviorist Dogma: Myths about Money and Motivation,” Compensation & Benefits Review (March–April 1998), pp. 27, 33–37.

21. H. Richlin, Modern Behaviorism (San Francisco: Upper Saddle River, NJ: Freeman, 1970); B. F. Skinner, Science and Human Behavior (New York: Macmillan, 1953); Alexander D. Stajkovic and Fred Luthans, “A Meta-Analysis of the Effects of Organizational Behavior Modification on Task Performance 1975–1995,” Academy of Management Journal 40 (October 1997), pp. 1122–1149; and F. Luthans and R. Kreitner, Organizational Behavior Modification and Beyond, 2nd ed. (Glenview, IL: Scott Foresman, 1985).

22. Alexander D. Stajkovic and Fred Luthans, “A Meta-Analysis of the Effects of Organizational Behavior Modification on Task Perfor- mance, 1975–1995,” Academy of Management Journal (October 1997), pp. 1122–1149; and Fred Luthans and Alexander D. Stajkovic, “Reinforce for Performance: The Need to Go Beyond Pay and Even Rewards,” Academy of Management Executive 13, no. 2 (1999), pp. 49–57.

23. Anthony DeRiso and Timothy D. Ludwig, “An Investigation of Response Generalization across Cleaning and Restocking Behaviors in the Context of Performance Feedback,” Journal of Organizational Behavior Management 32 (2012), pp. 141–151.

24. Martin Dewhurst, Matthew Guthridge, and Elizabeth Mohr, “Moti- vating People: Getting Beyond Money,” McKinsey Quarterly (November 2009), http://www.mckinseyquarterly.com/Motivating _people_Getting_beyond_money_2460 (accessed April 17, 2013).

25. Cranston and Keller, “Increasing the ‘Meaning Quotient’ of Work.”

26. Workforce MoodTracker Spring 2012 Report: The Growing Influ- ence of Employee Recognition (Southborough, MA: Globoforce, 2012).

27. Jessica Silver-Greenberg, “JPMorgan Cuts Dimon’s Pay, Even as Profit Surges,” The New York Times, (January 16, 2013), http:// dealbook.nytimes.com/2013/01/16/jpmorgan-4th-quarter-profit -jumps-53-to-5-7-billion/ (accessed January 16, 2013).

28. Amy Sutherland, “What Shamu Taught Me about a Happy Marriage,” The New York Times (June 25, 2006), http://www.nytimes.com/2006/06/ 25/fashion/25love.html?ex=1175659200&en=4c3d257c4d16e70 d&ei=5070 (accessed April 2, 2007).

29. Luthans and Kreitner, Organizational Behavior Modification and Beyond; L. M. Saari and G. P. Latham, “Employee Reaction to Continuous and Variable Ratio Reinforcement Schedules Involving a Monetary Incentive,” Journal of Applied Psychology 67 (1982), pp. 506–508; and R. D. Pritchard, J. Hollenback, and P. J. DeLeo, “The Effects of Continuous and Partial Schedules of Reinforcement on Effort, Performance, and Satisfaction,” Organizational Behavior and Human Performance 25 (1980), pp. 336–353.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 255

30. Victor H. Vroom, Work and Motivation (New York: John Wiley & Sons, 1969); B. S. Gorgopoulos, G. M. Mahoney, and N. Jones, “A Path–Goal Approach to Productivity,” Journal of Applied Psychology 41 (1957), pp. 345–353; and E. E. Lawler III, Pay and Organizational Effectiveness: A Psychological View (New York: McGraw-Hill, 1981).

31. Richard R. Johnson, “Explaining Patrol Officer Drug Arrest Activity through Expectancy Theory,” Policing: An International Journal of Police Strategies & Management 32, no. 1 (2009), pp. 6–20.

32. Richard M. Daft and Richard M. Steers, Organizations: A Micro/ Macro Approach (Glenview, IL: Scott, Foresman, 1986).

33. Jim Finkelstein and Melissa Mead, “Incentives and Rewards: What Melts Your Employees’ Butter?” Leadership Excellence (December 2012), p. 19.

34. J. Stacy Adams, “Injustice in Social Exchange,” in L. Berkowitz, ed., Advances in Experimental Social Psychology, 2nd ed. (New York: Academic Press, 1965); and J. Stacy Adams, “Toward an Under- standing of Inequity,” Journal of Abnormal and Social Psychology (November 1963), pp. 422–436.

35. Based on a story in Karla L. Miller, “@Work Advice: How to Deal with Pay Inequity,” The Washington Post, October 3, 2012, h t t p : / / a r t i c l e s . w a s h i n g t o n p o s t . c o m / 2 0 1 2 - 1 0 - 0 3 / l i f e s t y l e /35502549_1_monkey-cucumber-illegal-bias (accessed April 17, 2013).

36. Rachel Emma Silverman, “Psst … This is What Your Co-Worker Is Paid,” The Wall Street Journal (January 30, 2013), p. B6.

37. Quoted in ibid.

38. Edwin P. Hollander and Lynn R. Offerman, “Power and Leadership in Organizations,” American Psychology 45 (February 1990), pp. 179–189.

39. David P. McCaffrey, Sue R. Faerman, and David W. Hart, “The Appeal and Difficulties of Participative Systems,” Organization Science 6, no. 6 (November–December 1995), pp. 603–627.

40. Robert C. Ford and Myron D. Fottler, “Empowerment: A Matter of Degree,” Academy of Management Executive 9 (1995), pp. 21–31; Golnaz Sadri, “Empowerment for the Bottom Line,” Industrial Management (May–June 2011), pp. 8–13; and David E. Bowen and Edward E. Lawler III, “Empowering Service Employees,” Sloan Management Review 36 (Summer 1995), pp. 73–84.

41. John Izzo, “Step-Up Initiative: Create a Culture of Initiators,” Leadership Excellence (June 2012), p. 13.

42. Jay A. Conger and Rabindra N. Kanungo, “The Empowerment Process: Integrating Theory and Practice,” Academy of Management Review 13 (1988), pp. 471–482; and Albert Bandura, “Self-efficacy: Toward a Unifying Theory of Behavioral Change,” Psychological Review 84, no. 2 (1977), pp. 191–215. See M. Travis Maynard, Lucy L. Gilson, and John E. Mathieu, “Empowerment: Fad or Fab? A Multilevel Review of the Past Two Decades of Research,” Journal of Management 38, no. 4 (July 2012), pp. 1231–1281 for a recent review of the research on psychological empowerment.

43. These are based on Bowen and Lawler, “Empowering Service Employees”; Gretchen Spreitzer, “Social Structural Characteristics of Psychological Empowerment,” Academy of Management Journal 39, no. 2 (April 1996), pp. 483–504; and Russ Forrester, “Empower- ment: Rejuvenating a Potent Idea,” Academy of Management Executive 14, no. 3 (2000), pp. 67–80.

44. Silverman, “Psst … This Is What Your Co-Worker Is Paid.”

45. Forrester, “Empowerment: Rejuvenating a Potent Idea.”

46. Glenn L. Dalton, “The Collective Stretch,” Management Review 87 (December 1998), pp. 54–59.

47. Bradley L. Kirkman and Benson Rosen, “Powering Up Teams,” Organizational Dynamics 28 (Winter 2000), pp. 48–66; and Gretchen M. Spreitzer, “Psychological Empowerment in the

Workplace: Dimensions, Measurement, and Validation,” Academy of Management Journal 38, no. 5 (October 1995), p. 1442.

48. Reported in Carol Hymowitz, “Pay Gap Fuels Worker Woes,” The Wall Street Journal (April 28, 2008), p. B8.

49. J. R. Hackman and G. R. Oldham, Work Redesign (Reading, MA: Addison-Wesley, 1980); and J.R. Hackman and G. R. Oldham, “Motiva- tion through the Design of Work: Test of a Theory,” Organizational Behavior and Human Performance 16 (1976), pp. 250–279.

50. Issie Lapowsky, “The Motivator: The Nerdery; The One Role That Can Never Be Filled” (segment of “Hire Power Awards 2012: The Real Heroes of the American Economy”), Inc. (December 2012– January 2013), pp. 84–96 (segment is on page 92).

51. Jared Sandberg, “A Modern Conundrum: When Work’s Invisible, So Are Its Satisfactions,” The Wall Street Journal (February 19, 2008), p. B1.

52. Example from Dalton, “The Collective Stretch.”

53. Ford and Fottler, “Empowerment: A Matter of Degree.”

54. Jack Stack, “Hilcorp Energy Shares the Wealth,” The New York Times (July 6, 2010), http://boss.blogs.nytimes.com/2010/07/06 /hilcorp-energy-shares-the-wealth/ (accessed July 7, 2010).

55. This definition is based on Mercer Human Resource Consulting’s Employee Engagement Model, as described in Paul Sanchez and Dan McCauley, “Measuring and Managing Engagement in a Cross- Cultural Workforce: New Insights for Global Companies,” Global Business and Organizational Excellence (November–December 2006), pp. 41–50.

56. Lillian Cunningham, “New Data Show Only 30% of American Workers Engaged in Their Jobs,” On Leadership Blog, The Washington Post (April 30, 2013), http://www.washingtonpost .com/blogs/on-leadership/wp/2013/04/30/new-data-show-only-30-of -american-workers-engaged-in-their-jobs/ (accessed May 14, 2013).

57. Richard P. Finnegan, “The Price of Employee Disengagement,” Chief Executive (June 28, 2011), http://chiefexecutive.net/the-price-of-dis- engagement-and-an-exercise (accessed February 9, 2013); Curt Coff- man and Gabriel Gonzalez-Molina, Follow This Path: How the World’s Greatest Organizations Drive Growth by Unleashing Human Potential (New York: Warner Books, 2002); Rodd Wagner and James K. Harter, “The Third Element of Great Managing; Mom Was Right: You’re One of a Kind,” Gallup Management Journal (June 14, 2007); and Gerard H. Seijts and Dan Crim, “What Engages Employees the Most, or the Ten C’s of Employee Engagement,” Ivey Business Journal (March–April 2006).

58. Gallup studies reported in Pat Galagan, “Amplified and Connected,” T + D (December 2012), pp. 34–37.

59. Bob Phibbs, “Zappos Pays People to Quit—Should You?” Bob Phibbs, the Retail Doctor Website (December 6, 2011), http://www .reta ildoc.com/blog /za ppos-pa y s-people-to-quit-should-y ou/ (accessed April 18, 2013); and Barbara Rose, “Zappos Pays to Weed Out Uncommitted Workers,” Chicago Tribune (June 16, 2008), p. 2.

60. This discussion is based on Marcus Buckingham and Curt Coffman, First, Break All the Rules: What the World’s Greatest Managers Do Differently (New York: Simon & Schuster, 1999); and Theresa M. Welbourne, “Employee Engagement: Beyond the Fad and into the Executive Suite,” Leader to Leader (Spring 2007), pp. 45–51.

61. Wagner and Harter, “The Third Element of Great Managing.”

62. Buckingham and Coffman, First, Break All the Rules.

63. Anna Scott, “Dear Prudence,” People Management (January 2012), pp. 36–39.

64. Ibid.

65. This definition and discussion is based on Teresa M. Amabile and Steven J. Kramer, “The Power of Small Wins,” Harvard Business

256 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Review (May 2011), pp. 71–80; and Teresa M. Amabile and Steven J. Kramer, “What Really Motivates Workers: Understanding the Power of Progress,” Harvard Business Review (January–February 2010), pp. 44–45.

66. This section is based on Gretchen Spreitzer and Christine Porath, “Creating Sustainable Performance,” Harvard Business Review (January–February 2012), pp. 92–99; and Gretchen Spreitzer, Christine L. Porath, and Cristina B. Gibson, “Toward Human

Sustainability: How to Enable More Thriving at Work,” Organiza- tional Dynamics 41 (2012), pp. 155–162.

67. Mary Knight, “Three Strategies for Making Employee Engagement Stick,” Gallup Business Journal (January 17, 2013), http://business- journal.gallup.com/content/159851/th ree-strategies-making- employee-engagement-stick.aspx (accessed April 18, 2013); and Tracy Maylett and Julie Nielsen, “There Is No Cookie-Cutter Approach to Engagement,” T + D (April 2012), pp. 55–59.

CHAPTER 8 MOTIVATION AND EMPOWERMENT 257

Chapter 9: Leadership Communication

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Act as a communication champion and a “sensegiver” rather than just as an information processor. • Use key elements of effective listening and understand why listening is important to leader

communication.

• Use candor appropriately to improve your communication effectiveness, and recognize and apply the difference between dialogue and discussion.

• Incorporate metaphor and storytelling into your leadership communications. • Select an appropriate communication channel for your message and effectively use social media

and nonverbal communication.

• Communicate in a way that persuades and influences others. • Effectively communicate during times of stress or crisis.

CHAPTER OUTLINE 260 How Leaders

Communicate

264 Leading Strategic Conversations

274 Communicating to Persuade and Influence

275 Selecting the Correct Communication Channel

278 Nonverbal Communication

280 Current Communication Challenges

In the Lead

265 United States Africa Command (USAFRICOM)

268 Kevin Sharer, Amgen Inc.

277 John Chambers, Cisco Systems

281 Duke University

Leader’s Self-Insight

262 Am I Networked?

269 Listening and Asking Questions

272 Do You Speak with Candor?

Leader’s Bookshelf

273 Tell to Win: Connect, Persuade, and Triumph with the Hidden Power of Story

Leadership at Work

283 Listen Like a Professional

Leadership Development: Cases for Analysis

285 The Superintendent’s Directive

286 Hunter-Worth

I n April of 2010, a Transocean oil rig digging a deep-sea well for BP exploded in the Gulf of Mexico, killing 11 workers and spewing oil into the sea for months. Why didn’t anyone see that there were problems in safety procedures and flaws in

equipment that could lead to such a disaster? The sad answer is that people did see, but they were too afraid to speak up. A survey of workers found that many people were concerned about overlooked safety practices, delayed equipment maintenance and inspections, poor equipment reliability, and unsafe behaviors on the rig, but they didn’t report their concerns for fear of reprisals. Most said they felt free to raise issues that could be immediately addressed on the rig, but they hesitated to bring up matters that had to be passed up the hierarchy because of the company’s use of “fear tactics.” Some workers even admitted that they entered false data into Transocean’s system for tracking safety issues; thus, top executives at Transocean had a distorted perception of maintenance and safety on the rig.1

If ever there were an illustration of the dangers of poor organizational communication, it is the BP–Transocean catastrophe. No one likes to hear bad news, but leaders have to know about problems or they cannot solve them. When

259 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

people are afraid to speak up, don’t care enough to speak up, or find that no one is listening, the organization and everyone associated with it is hurt. As a leader, you will define your team or organization’s communication climate, whether things are discussed openly or suppressed, whether people know and care what is going on in the organization or do not, and whether listening is valued as a key part of the communication process.

Leaders need good communication skills particularly during these times of weakened trust, uncertainty, and economic crisis. Recall that leadership means influencing people to bring about change toward a vision, or desired future, for the organization. Leaders communicate to share the vision with others, inspire and motivate them to strive toward the vision, and build the values and trust that enable effective working relationships and goal accomplishment.

Successful leader communication also includes deceptively simple components, such as asking questions, paying attention to nonverbal communication, and actively listening to others. Unfortunately, research shows that many executives are not investing the time and energy to be effective communicators. A recent survey by AMA Enterprise found that nearly 40 percent of employees feel out of the loop and don’t know what is going on in their companies. Only a measly 9 percent reported knowing what is going on most of the time.2 Leaders are clearly not doing a good job communicating their visions and goals and keeping employees informed and involved. Moreover, many leaders resist employee feedback because they don’t want to hear negative information. Without feedback, leaders can miss important signals that something is going wrong. In addition, when leaders don’t have feedback, they often make decisions and plans that are out of alignment with employee needs or perceptions, making smooth implementation less likely.3

This chapter describes tools and skills that can be used to overcome the communication deficit pervading today’s organizations. We examine how leaders use communication skills to make a difference in their organizations and the lives of followers.

HOW LEADERS COMMUNICATE Have you ever had a supervisor or instructor whose communication skills were so poor that you didn’t have any idea what was expected of you or how to accomplish the job you were asked to do? On the other hand, have you experienced the com- munication flair of a teacher, boss, or coach who “painted a picture in words” that both inspired you and clarified how to achieve an objective?

Leadership means communicating with others in such a way that they are influ- enced and motivated to perform actions that further common goals and lead toward desired outcomes. Communication is a process by which information and understanding are transferred between a sender and a receiver, such as between a leader and an employee, an instructor and a student, or a coach and a football player. Exhibit 9.1 shows the key elements of the communication process. The sender (such as a leader) initiates a communication by encoding a thought or idea, that is, by selecting symbols (such as words) with which to compose and transmit a message. The message is the tangible formulation of the thought or idea sent to the receiver, and the channel is the medium by which the message is sent. The channel

Communication a process by which infor- mation and understanding are transferred between a sender and a receiver

260 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

could be a formal report, a blog, a telephone call, an e-mail or text message, or a face-to-face conversation. The receiver decodes the symbols to interpret the mean- ing of the message. Encoding and decoding can sometimes cause communication errors because individual differences, knowledge, values, attitudes, and background act as filters and may create “noise” when translating from symbols to meaning. People can easily misinterpret messages. Feedback is the element of the communica- tion process that enables someone to determine whether the receiver correctly inter- preted the message. Feedback occurs when a receiver responds to a leader’s communication with a return message. Without feedback, the communication cycle is incomplete. Effective communication involves both the transference and the mutual understanding of information.4 As illustrated in Exhibit 9.1, the nature of effective communication is cyclical, in that a sender and receiver may exchange messages several times to achieve a mutual understanding. The ongoing process of sending, receiving, and feedback to test understanding underlies both management and leadership communication.

EXHIBIT 9.1 A Circular Model of Interpersonal Communication

Channel Ch

an ne l

Sources: Based on Gabriela Moise, “Communication Models Used in the Online Learning Environment,” The 3rd International Conference on Virtual Learning 2008 , ICVL (http://www.icvl.edu/2008), pp 247–254; and Wilbur Schramm, The Process and Effects of Mass Communication, 6th Ed. (Urbana, IL: University of Illinois Press, 1965).

CHAPTER 9 LEADERSHIP COMMUNICATION 261

Management Communication The traditional role of a manager is that of an “information processor.” Managers spend some 80 percent of each working day in communication with others.5 In other words, 48 minutes of every hour are spent in meetings, on the telephone, or talking informally with others. Managers scan their environments for important written and personal information, gathering facts, data, and ideas, which in turn are sent to subordinates and others who can use them. A manager then receives subordinate messages and feedback to check understanding and determine whether to modify messages for accuracy.

Managers have a huge communication responsibility in directing and controlling an organization. They communicate facts, statistics, and decisions. Effective managers establish themselves at the center of information networks to facilitate the completion of tasks. Leadership communication, however, serves a different purpose.

The Leader as Communication Champion Although leadership communication also includes the components of sending, receiving, and feedback, it is different from management communication. Leaders often communicate the big picture—the vision, as defined in Chapter 1—rather

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 9.1

Am I Networked?

Instructions: Think about your current life as an employee or as a student. Indicate whether each of the following items is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I learn early on about changes going on in the organization that might affect me or my job.

2. I have a clear belief about the positive value of active networking.

3. I am good at staying in touch with others.

4. I network as much to help other people solve problems as to help myself.

5. I am fascinated by other people and what they do.

6. I frequently use lunches to meet and network with new people.

7. I regularly participate in charitable causes.

8. I maintain a list of friends and colleagues to whom I send holi- day cards.

9. I build relationships with people of different gender, race, and nationality than myself.

10. I maintain contact with people from previous organizations and school groups.

11. I actively give information to subordinates, peers, and my boss.

12. I know and talk with peers in other organizations.

Scoring and Interpretation Add the number of Mostly True answers for your score: . A score of 9 or above indicates that you are excellent at networking and can be a networking leader. A score of 3 or below would suggest that you need to focus more on building networks, perhaps work in a slow-moving occupation or organization, or not put yourself in a position of leadership. A score of 4Ģ8 would be about average.

Networking is the active process of building and man- aging productive relationships. Networking builds social, work, and career relationships that facilitate mutual under- standing and mutual benefit. Leaders accomplish much of their work through networks rather than formal hierarchies.

Source: The ideas for this self-insight questionnaire were drawn primarily from Wayne E. Baker, Networking Smart: How to Build Relationships for Personal and Organizational Success (New York: McGraw-Hill, 1994).

NEW LEADER ACTION MEMO Networking is a vital part of leadership information sharing. Answer the questions in Leader’s Self-Insight 9.1 to learn whether you network with other people similar to what successful leaders do.

| D re am

st im e. co m

262 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

than facts and pieces of information. A leader can be seen as a communication champion.6

A communication champion is philosophically grounded in the belief that com- munication is essential to building trust and gaining commitment to the vision and strategy. Leaders use communication to unite people around a common sense of purpose and identity and to ensure that the vision and strategy are deeply under- stood and accepted by employees. This deep understanding and acceptance of organizational direction and purpose is referred to as embeddedness.7 When the vision and strategy are embedded, everyone’s daily decisions and actions help move the firm in the right direction, toward achieving important goals. In many of today’s organizations, command-and-control management is counterproductive. People cannot simply be ordered what to do. They need to understand and accept the vision and strategy so they can align their actions to support the organization’s competitive intentions.

Leadership communication also shapes how people think about their work and the organization. Leaders are sensegivers. Sensegiving refers to the process of influencing how others construct meaning and make sense of the organization and their place in it.8 Good leaders not only use communication to inspire peo- ple with a vision and instill the values that are necessary for achieving it, they also communicate to help people understand the larger purpose of their own work (find meaning) and see how they fit in the organization. Communication champions visibly and symbolically engage in communication-based activities. Whether they walk around asking questions or thoughtfully listen to a subordi- nate’s ideas or problems, the everyday actions of communication champions convey a deep commitment to communication and sensegiving. Communication isn’t just about occasional meetings, formal speeches, or presentations. Leaders actively communicate through both words and actions every day. Regular com- munication is essential for building personal relationships and binding people together to accomplish the vision and purpose. This chapter’s Consider This highlights the importance of leaders taking a positive approach to communicating.

Exhibit 9.2 shows the leader-as-communication-champion model. By establish- ing an open communication climate, asking questions, actively listening to others, applying the practice of dialogue, using candor, and telling stories, leaders facilitate and support strategic conversations that help move the organization forward.

EXHIBIT 9.2 The Leader as Communication Champion

Communication champion a person who is philosophi- cally grounded in the belief that communication is es- sential to building trust and gaining commitment to a vision

Embeddedness when people throughout the organization are united around a common purpose based on a deep under- standing and acceptance of the vision and strategy

Sensegiving the process of influencing how others make sense of the organization, where they fit within it, and the larger purpose of their work

CHAPTER 9 LEADERSHIP COMMUNICATION 263

Leader communication is purpose-directed in that it directs everyone’s attention toward the vision, values, and desired outcomes of the group or organization and persuades people to act in a way to help achieve the vision.

Leaders use many communication methods, including selecting rich channels of communication and using nonverbal communication. Leaders often use sym- bolic language and behavior to get their messages across and to influence others. For example, President Ronald Reagan was known as a great communicator. In communicating his message about the federal budget, Reagan spoke of a trillion dollars in terms of stacking it next to the Empire State Building. Framed this way, the message redefined the meaning of a trillion dollars and took on a new reality for the public.

LEADING STRATEGIC CONVERSATIONS A strategic conversation refers to people talking across boundaries and hierarchical levels about the group or organization’s vision, critical strategic themes, and the values that can help achieve desired outcomes. Leaders facilitate strategic conver- sations by (1) asking questions and actively listening to others to understand their attitudes and values, needs, personal goals, and desires; (2) setting the agenda for conversation by underscoring the key strategic themes that are linked to organiza- tional success; and (3) selecting the right communication channels and facilitating dialogue.9 An example of strategic conversation comes from the U.S. military, which received strong criticism both at home and abroad when the Department of Defense announced the establishment of the United States Africa Command (USAFRICOM).

Consider Communication Starts in the Mind and the Heart

The thought manifests as the word, The word manifests as the deed, The deed develops into habit, And the habit hardens into character. So watch the thought and its way with care, And let it spring from love Born out of concern for all things.

The words above echo what the Buddha said more than 2,500 years ago: “We are what we think. All that we are arises with our thoughts. With our thoughts we make the world.” The truth of this verse is timeless: it is truth whether for the past, the present, or the future.

Source: K. Sri Dhammananda, How to Live without Fear and Worry (Kuala Lumpur, Malaysia: BMS Publications, 1989), p. 192.

NEW LEADER ACTION MEMO As a leader, you can be a communication champion and a sensegiver. You can use verbal, nonverbal, and symbolic com- munication to unite people around a common vision, facilitate strategic conversa- tions, and build trust.

264 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Strategic conversation communication that takes place across boundaries and hierarchical levels about the group or organization’s vision, critical strategic themes, and values that can help achieve desired outcomes

IN THE LEAD United States Africa Command (USAFRICOM) When the U.S. Department of Defense announced the establishment of USAFRICOM as a Geographic Combatant Command (GCC) that would assume responsibility over Department of Defense activities on the continent of Africa, most leaders knew it could provoke suspi- cions and misunderstandings.

It was a seemingly simple reorganization, as these responsibilities had previously been divided among other GCCs. The first commander and other leaders of USAFRICOM were firmly committed to the reorganization as a positive step, but they needed everyone involved to see things that way as well. They implemented a comprehensive communications plan that facilitated a strategic conversation among everyone involved—a wide range of partici- pants from across the United States, Africa, Europe, and the broader international community. Leaders deliberately developed a set of simple, consistent messages in response to a set of questions they asked themselves about the mission, purpose, and nature of USAFRICOM.

They also asked questions of stakeholders, particularly their African partners, whom they considered the most important stakeholder group. The approach “was to give them the voice that they wanted and to know that we were there to listen and understand.” The goal was to support, rather than undermine, “African solutions for African problems.” Rather than offering specific services or describing what they thought Africa should look like in the future, leaders sought to learn their partners’ priorities and strategies. Emphasis throughout the early communications strategy was on openness, transparency, candor, and inclusivity. Leaders created a unifying theme of building the team and developed messages that illustrated USAFRICOM as a “listening and learning organization.”10

Although there remain detractors and critics, USAFRICOM continues to stress openness and transparency and encourages people to check out its work at http:// www.africom.mil. In other words, the strategic conversation continues. This exam- ple illustrates the six key components for facilitating strategic conversations: an open communication climate, asking questions, active listening, dialogue, candor, and using stories for communication. These six elements are described in the following sections.

Creating an Open Communication Climate Open communication means sharing all types of information throughout the organi- zation, especially across functional and hierarchical boundaries. Open communica- tion runs counter to the traditional flow of selective information downward from supervisors to subordinates. Good leaders want communication to flow in all directions. Communication across traditional boundaries enables leaders to hear what followers have to say, which means the organization gains the benefit of all employees’ minds. The same perspectives batted back and forth between top execu- tives don’t lead to effective change, the creation of a powerful shared vision, or the network of personal relationships that keeps organizations thriving. New voices and continuous conversation involving a broad spectrum of people revitalize and enhance communication.11

To build an open communication climate, leaders break down conventional hierarchical and departmental boundaries that may be barriers to communication,

CHAPTER 9 LEADERSHIP COMMUNICATION 265

Open communication leaders sharing all types of information throughout the company and across all levels

enabling them to convey a stronger awareness of and commitment to organizational vision, goals, and values. In an open climate, a leader’s communication of the vision “cascades” through an organization, as explained in Exhibit 9.3. People throughout the organization thus have a clear direction and an understanding of how they can contribute.12 An open communication climate helps alleviate tension and conflict between departments, builds trust, reaffirms employee commitment to a shared vision, and makes a company more competitive.

Asking Questions Managers typically think they should be the people with the right answers. Leader- ship, though, is more about being the person with the right questions.13 Many leaders—indeed, most people in general—are unaware of the amazing power of questions. In our society, we’re conditioned to come up with answers. Very young children are typically full of questions, but from an early age they’re discouraged from asking them. Students are expected to hold up their hands in class to give the right answer, and they’re often chastised for an incorrect response. Leaders often assume that if someone comes to them with a problem, their job is to solve it with the correct answer. They mistakenly fear that not having an answer means followers will lose respect for them.

What Questions Do Leaders Ask? One purpose of questioning is leader-centered, in that it seeks to inform the leader about what is going on in the organization; inves- tigate specific issues, problems, or opportunities; and gather information, ideas, or insights. This type of questioning is important because it helps leaders tap into the expertise and ideas of followers. With advances in technology and communications, no one person can master all the data and information needed to meet the chal- lenges most organizations face. Even in 1928, when Paul Galvin founded Motorola, he recognized the value of this type of questioning. His son Bob Galvin said his father learned about what was happening in the business in the company cafeteria. “He would always make a point of eating with employees at lunchtime,” Galvin said. “He’d ask them lots of questions about operations, customers, and how to improve quality.”14

EXHIBIT 9.3 Why Open the Communication Climate?

An open climate is essential for cascading vision, and cascading is essential because:

Natural Law 1: You Get What You Talk About A vision must have ample “air time” in an organization. A vision must be shared and practiced by leaders at every opportunity.

Natural Law 2: The Climate of an Organization Is a Reflection of the Leader A leader who doesn’t embody the vision and values doesn’t have an organization that does.

Natural Law 3: You Can’t Walk Faster Than One Step at a Time A vision is neither understood nor accepted overnight. Communicating the vision must be built into continuous, daily interaction so that over time followers will internalize it.

Source: Based on Bob Wall, Robert S. Slocum, and Mark R. Sobol, Visionary Leader (Rocklin, CA: Prima Publishing, 1992), pp. 87–89.

NEW LEADER ACTION MEMO As a leader, you can create an open communication climate by sharing both good and bad information, and you can facil- itate communication across groups, departments, and hierarchical levels.

266 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Leaders also use questions for another purpose. This approach is follower- centered, in that it seeks to connect with followers, develop new insights, encourage critical thinking, expand people’s awareness, and stimulate learning. One study found that 99 percent of top managers surveyed believe that critical thinking skills at all levels are crucial to the success of their organizations.15

Benefits of Asking Questions Asking the right kinds of questions benefits both leaders and followers in many ways.16 Questions encourage people to think and empower them to find answers, helping to build positive attitudes and follower self-confidence. Asking questions rather than giving answers provokes critical thought and leads to deeper, more lasting learning. In addition, asking questions shows that leaders care about people on an individual basis, value the opinions and knowledge of others, are open to new ideas, and have faith that people want to contribute to the organization, which helps to build trusting, respectful relationships.17 People want their leaders to recognize them as individuals and let them be part of something meaningful. Jonathan Kraft, president of the New England Patriots football team, says he and his father, team chairman Robert Kraft, have only one role: “We ask questions just as any manager would, to spur the thinking.” Other than that important job, the Krafts leave the Patriots to the leadership of Coach Bill Belichick, personnel head Nick Caserio, and other team leaders.18

Listening Just as important as asking questions is listening to the responses. A recent survey of 800 employees across a variety of industries found that about two-thirds of respondents felt that their opinion was either unwelcome or not valued at work.19

An open communication climate is not possible if leaders aren’t listening. When lea- ders fail to listen to employees, it sends the signal, “you don’t matter,” which decreases commitment and motivation. People are willing to share their ideas, sug- gestions, and problems when they think someone is listening and genuinely values what they have to say.

Hearing is easy, but really listening is hard.20 Listening involves the skill of grasping and interpreting a message’s genuine meaning. Remember that message reception is a vital link in the communication process. However, many leaders take listening for granted and focus their time and energy on learning how to ver- balize and present their own ideas more effectively. When talking with someone, they concentrate on formulating what they’re going to say next rather than on what is being said to them. Fortunately, leaders can develop their listening just as they can any other skill.21

What constitutes good listening? Exhibit 9.4 gives 10 keys to effective listen- ing and illustrates a number of ways to distinguish a bad listener from a good one. A key to effective listening is focus. A good listener’s total attention is focused on the message; he isn’t thinking about an unrelated problem in the pur- chasing department, how much work is piled up on his desk, or what to have for lunch. A good listener also listens actively, keeps an open mind, works hard at listening, and uses thought speed to mentally summarize, weigh, and anticipate what the speaker says.

Do you practice good listening habits? To find out, log in to CengageNOW to complete the

interactive questionnaire.

NEW LEADER ACTION MEMO Evaluate your skills for listen- ing and asking questions by completing the questionnaire in Leader’s Self-Insight 9.2.

CHAPTER 9 LEADERSHIP COMMUNICATION 267

Listening the skill of grasping and in- terpreting a message’s gen- uine meaning

Effective listening is engaged listening. Good leaders get out of their office and mingle with others, ask questions, set up listening forums where people can say whatever is on their minds, and provide feedback to let people know they have been heard.22 Active listening is a daily, ongoing, and vital part of every leader’s job. Kevin Sharer, recently retired CEO of Amgen, calls it “strategic listening.”

IN THE LEAD Kevin Sharer, Amgen Inc. Kevin Sharer admits that he was a terrible listener for much of his career. He didn’t mean to be; he just wanted to get ahead in life and believed that meant convincing others of his point of view. Then one day, he heard Sam Palmisano, who guided IBM to record growth and profits before he turned over the CEO job to Virginia Rometty in 2012, talk about why his work in Japan was so important to his leadership development. “Because I learned to lis- ten,” Palmisano said. “I learned to listen by having only one objective: comprehension.… I wasn’t listening to critique or object or convince.”

It was an epiphany for Sharer, who realized that being a good leader is less about con- vincing others of your point of view and more about respecting and getting the best out of people—and that requires really listening to them. A leader operates in a complex ecosystem,

EXHIBIT 9.4 Ten Keys to Effective Listening

Key Poor Listener Good Listener

1. Listen actively Minimally involved, unfocused Shows interest; nods, asks ques- tions, paraphrases what is said

2. Keep an open mind Pays attention only to ideas that conform to own opinions

Looks for opportunities and new learning

3. Resist distractions Is easily distracted Fights distractions; tolerates bad habits; knows how to concentrate

4. Capitalize on the fact that thought is faster than speech

Tends to daydream with slow speakers

Challenges, anticipates, summarizes; listens between lines to tone of voice

5. Seek understanding Feigns agreement to bring the conversation to an end

Searches for common ground and new understanding

6. Judge content, not delivery

Tunes out if delivery is poor Judges content; skips over delivery errors

7. Hold one’s fire Spouts solutions before under- standing the problem or question

Does not judge or respond until comprehension is complete

8. Listen for ideas Listens for facts Listens to central themes

9. Work at listening No energy output; passive and laid back

Works hard; exhibits active body state, eye contact

10. Show respect Interrupts; talks over the other person when trying to get a point across

Learns to keep quiet and let the other person do most of the talking

Sources: Based on “A Field Guide to Identifying Bad Listeners,” McKinsey Quarterly, Issue 2 (2012), p. 112; Bernard T. Ferrari, “The Executive’s Guide to Better Listening,” McKinsey Quarterly, Issue 2 (2012), pp. 50–60; Philip Morgan and Kent Baker, “Building a Professional Image: Improving Listening Behavior,” Supervisory Management (November 1985), pp. 34–38; and Sherman K. Okun, “How to Be a Better Listener,” Nation’s Business (August 1975), p. 62.

268 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Sharer says, and has to employ strategic listening to get all the signals that give a full picture of what is going on. “You’ve got to seek out these signals actively and use every possible means to receive them,” he says. Sharer began regularly visiting and genuinely listening to people throughout the company. He admits it wasn’t easy. “You have to change,” he says, “and you have to want to change…. There has to be a certain humility to listen well.”23

Listening, Sharer believes, is the greatest sign of respect you can give someone. “Eventually, executives who don’t listen lose the support of their teams and collea- gues. And once you’ve lost that support, it’s almost impossible to get it back.”24

Dialogue In most organizations, there are some issues that are characterized by strong emo- tions and extreme uncertainty and that can’t be resolved by resorting to facts and logic. With these so-called hot topics, the stakes for those involved are high. When hot topics involve whole groups of employees, a type of communication referred to as dialogue can help.

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 9.2

Listening and Asking Questions

Instructions: Think about how you communicate during a typ- ical day at school or work. Respond to the statements below based on whether they are Mostly False or Mostly True for you. There are no right or wrong answers so answer honestly.

Mostly False

Mostly True

1. I am extremely attentive to what others say.

2. I deliberately show people that I am listening to them.

3. I really enjoy listening very care- fully to people.

4. My mind does not wander when someone is talking.

5. I often restate what the person said and ask if I got it right.

6. I usually think about a response while a person is still talking.

7. I often ask people to clarify what they mean.

8. I ask questions in every conversation.

9. I am genuinely curious in con- versations about what other people think.

10. During a conversation, I fre- quently probe for deeper information.

11. I inquire about others’ points of view on topics.

12. I don’t hesitate to ask what may appear to be dumb questions.

Scoring and Interpretation Compute two scores from your answers and insert them below. For your listening score, sum 1 point for each Mostly True answer for items 1–5 and for a Mostly False answer to item 6. For your asking questions score, sum 1 point for each Mostly True answer to items 7–11. Insert your two scores below.

Listening score . Asking Questions score .

Your first score reflects your listening habits. Managers face many distractions, which makes it hard to pay attention when someone is speaking. Listening attentively can pre- vent many communication mistakes. Your second score reflects your habit of inquiry, which means asking questions to learn more about something or to confirm your under- standing. Asking questions is an important part of an effec- tive leader’s communication repertoire, as described in the text. Scores of 5–6 reflect excellent communication habits. Scores of 0–2 suggest that you may need to work on your communication practices. Scores of 3–4 imply that you are doing okay but have room for improvement.

Source: Partially based on William B. Snavely and John D. McNeill, “Communicator Style and Social Style: Testing a Theoretical Interface,” Journal of Leadership and Organizational Studies 14, no. 1 (February 2008), pp. 219–232.

NEW LEADER ACTION MEMO As a leader, you can learn to be a better listener. You can focus your total attention on what the other person is say- ing and work hard to listen— use eye contact; ask questions and paraphrase the message; and offer positive feedback.

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The “roots of dialogue” are dia and logos, which can be thought of as a stream of meaning. In dialogue, people together create a stream of shared meaning that enables them to understand each other and share a view of the world.25 People may start out as polar opposites, but by actively listening and talking authentically to one another, they discover their common ground, common issues, and common dreams on which they can build a better future. Most of us have a tendency to infuse everything we hear with our own opinions rather than being genuinely open to what others are saying. In addition, traditional business values in the United States and most other Western countries reward people for forcefully asserting their own ideas and opinions and trying to discredit or contradict others.26 But peo- ple can engage in dialogue only when they come to a conversation free of prejudg- ments, personal agendas, and “right” answers. Participants in a dialogue do not presume to know the outcome, nor do they sell their convictions.

One way to understand the distinctive quality of dialogue is to contrast it with dis- cussion.27 Exhibit 9.5 illustrates the differences between a dialogue and a discussion. Typically, the intent of a discussion is to present one’s own point of view and persuade others in the group to adopt it. A discussion is often resolved by logic or by “beating

NEW LEADER ACTION MEMO As a leader, you can use dia- logue to help people create a shared sense of meaning and purpose. You can enable people to express their hopes and fears, suspend their convictions and explore assumptions, and become motivated to search for common ground.

EXHIBIT 9.5 Dialogue and Discussion: The Differences

Sources: Based on Edgar Schein, “On Dialogue, Culture, and Organizational Learning,” Organizational Dynamics 22, no. 2 (Fall 1993), pp. 40–51; Deborah L. Flick, From Debate to Dialogue: Using the Understanding Process to Transform Our Conversations (Boulder, CO: Orchid Publications, 1998), p. 22; and Glenna Gerard and Linda Teurfs, “Dialogue and Organizational Transformation,” in Community Building: Renewing Spirit and Learning in Business, Kazimierz Gozdz, ed. (Pleasanton, CA: New Leaders Press, 1995).

Dialogue active sharing and listening in which people explore common ground and grow to understand each other and share a world view

270 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

NEW LEADER ACTION MEMO Complete the questions in Leader’s Self-Insight 9.3 to learn how effective you are at communicating with candor.

down” opposing viewpoints. Dialogue, on the other hand, requires that participants suspend their attachments to a particular point of view so that a deeper level of listening, synthesis, and meaning can emerge from the group. A dialogue’s focus is to reveal feel- ings and build common ground, with the emphasis on inquiry rather than advocacy.

Dialogue is particularly useful for conversations about hot topics. One example of using dialogue for hot topics occurred at NECX, an online marketplace that was acquired by Converge. Henry Bertolon, cofounder and CEO, introduced dialogue to improve communication after a period of rapid growth led to internal tensions. “We’d have meetings that just melted down,” he says. “Everyone would scream at each other and then leave.” Bertolon hired Wil Calmas, a psychologist with an MBA, to lead a series of programs to get people talking—and listening—to one another on a deeper, authentic level. People were encouraged to express fear, hostility, frustration, and secret wishes—whatever feelings were affecting their lives and work. The dialogue sessions cre- ated a safe environment for people to reveal their feelings, explore ideas, and build com- mon ground. Bertolon also believed it helped employees be loose, flexible, and open to new ideas—ready to respond to the rapid changes taking place all around them.28

Both forms of communication, dialogue and discussion, can result in organiza- tional change. However, the result of a discussion is limited to a specific topic being deliberated, whereas the result of dialogue is characterized by group unity, shared meaning, and transformed mindsets. This kind of result is far-reaching. A new, common mindset is not the same thing as agreement because it creates a reference point from which subsequent communication can start. As new and deeper solu- tions are developed, a trusting relationship is built among communicators, which is important to all communication episodes that follow. Dialogue thus transforms communication and, by extension, the organization.

Communicating with Candor A communication approach that can limit the potential for workplace misunderstand- ings, incivility, and ill will that turn into hot topics is candor. When leaders communi- cate with candor, they encourage others to do the same. Candor refers to honest, forthright expression of a leader’s thinking.29 Communicating with candor means being direct, honest, and clear about what followers need to do to meet objectives, while also expressing respect for others and not making people feel slighted, controlled, or exploited. Candor is extremely important when dealing with hot topics. Unfortu- nately, communicating with candor is a problem for many leaders. Jack Welch, speaker, author, and former CEO of General Electric, says when he asks groups of managers how many of them have received candid performance appraisals, only about 10 percent of people raise their hands. When he asks how many have given can- did appraisals to their employees, the results aren’t much better.30

Communicating with candor means letting followers know exactly where the leader stands and what the leader expects of them. The appropriate use of candid com- munication acknowledges the other person’s perspective and opinion, yet is very spe- cific about what the leader wants and why. Leaders who communicate with candor keep the focus on the specific perception they have and the effect it has on the leader and organization rather than accusing or blaming the other person. They stick to facts rather than judgments and are very clear about what they want from followers.31

In an organization where candid communication is the norm, everything works faster and better.32 When everyone feels free to open up and speak frankly, more peo- ple get involved in organizational conversations so ideas get debated, adapted, and acted upon more quickly. Candid communication also limits common problems such as meaningless meetings, rancorous silence, or ineffective teamwork. At Taunton Press, a special-interest publishing company, the lack of candor led to endless

Candor honest, forthright expression of a leader’s thinking

CHAPTER 9 LEADERSHIP COMMUNICATION 271

meetings and decreased productivity. In a small, close-knit company like Taunton, people naturally don’t want to offend one another. Yet over time the culture of “terminal niceness” that evolved sabotaged teamwork. Executives hired consultants from Fierce Inc. to help Taunton leaders and employees see that healthy relationships include both confrontation and appreciation. “In an honest and authentic relation- ship, one must communicate truthfully, and in a collaborative relationship, one must ask candid questions,” says Halley Bock, president and CEO of Fierce. Over time, Taunton transformed to a culture of candor, collaboration, and accountability.33

The Power of Stories Native American tribes often made the best storytellers their tribal leaders.34 That’s because stories can have tremendous influence on people’s beliefs, attitudes, and beha- viors. Recall the earlier discussion of leaders as sensegivers. Telling stories is the founda- tion of sensegiving. Storytelling goes hand in hand with listening. Leaders listen to the stories of employees, customers, and others and tap into clues about how to construct their own stories to unite people with purpose and meaning. Stories can help people make sense of complex situations, bind them together in a shared purpose, inspire action, and bring about change in a way that other forms of communication cannot.

Evidence for the compatibility of stories with human thinking was demonstrated by a study at the Stanford Business School.35 The goal was to convince MBA students that a company practiced a “no-layoffs” policy. Some students were told only a story related to the company’s commitment to avoiding layoffs. A second group was given statistical data showing little turnover compared to competitors. Another group was shown the company’s policy statement. A fourth group was provided with statistics and a story combined. Of all these approaches, the students presented with the story alone were most convinced that the company practiced a no-layoffs policy. This is a powerful lesson for leaders. To influence people, it is important to win their hearts, and stories are the best way to do that. Leaders who incorporate imagery and elements

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 9.3

Do You Speak with Candor?

Instructions: Respond to the statements below based on how you speak to others during personal or work conversa- tions. Answer whether each statement is Mostly True or Mostly False for you. There are no right or wrong answers so answer honestly.

Mostly False

Mostly True

1. I say exactly what I think to people.

2. I never hesitate to hurt people’s feelings by telling the truth.

3. I like to be strictly candid about what I say.

4. I am very straightforward when giving feedback.

5. I present evidence for my opinions.

6. I am an extremely frank communicator.

Scoring and Interpretation Give yourself one point for each Mostly True answer and write your score below.

Candor Score .

Your score reflects the level of candor with which you communicate. Many people have a hard time giving straightfor- ward opinions and frank feedback because they don’t want to hurt a person’s feelings nor do they want people to dislike them. Hence the sharing of honest observations is limited. A score of 5–6 on this scale reflects a habit of candor, which will add to your leadership effectiveness. A score of 3–4 means that you do reasonably well at saying what you think. A score of 0–2 means you may have a hard time speaking straight and you may want to practice to improve your candor.

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NEW LEADER ACTION MEMO As a leader, use story and metaphor to help people con- nect emotionally with your message and the key values you want to instill.

272 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

of story in their everyday language have a more powerful and lasting influence than those who simply marshal facts and figures to support their point.

Everyone can learn to use stories, and stories need not be long or carefully con- structed to have an impact. A story can be a joke, a simple example illustrating an idea, a historical incident, something from a movie or television show, a personal expe- rience, or something read on a blog or news page. The key point is that it should create an emotional context for getting the leader’s message across.36 One senior leader referred to Lewis and Clark’s 1804–1806 expedition through 7 689 miles of uncharted territory to get people lined up in support of a new vision and strategy. Along the way, there would be “mountains,” “rivers,” and “friends and foes alike,” he told them, but just like Lewis and Clark they could adapt to the many twists and turns of the journey. Using the image worked; the entire organization came to embrace the new vision, and people often refer back to the Lewis and Clark story to remember that they are on an adventurous journey.37 Pulling together in the same direction is essential for change to happen, and people come together because of emotion, not logic.

“People are wired for telling and hearing stories,” says Peter Guber, Hollywood film producer, CEO of Mandalay Entertainment Group, and author of Tell to Win: Connect, Persuade, and Triumph with the Hidden Power of Story, which is further described in this chapter’s Bookshelf. “We need to plug into that and use it.”38

LEADER’S BOOKSHELF Tell to Win: Connect, Persuade, and Triumph with the Hidden Power of Story

by Peter Guber

Everybody in a leadership role shares the same problem, Peter Guber says in Tell to Win: “To succeed, you have to persuade others to support your vision, dream, or cause.” Whatever the purpose of a leader communication—motivating employees, engaging customers, or organizing inves- tors—leaders have to “get your listeners’ attention, emotionalize your goal as theirs, and move them to act…. You have to reach their hearts as well as their minds.” What’s the best way to do that? With a story. For leaders, telling purposeful stories is an everyday requirement.

HOW TO TELL A PURPOSEFUL STORY As an entrepreneur, media mogul, and producer of award-winning films includ- ing Batman, Midnight Express, The Color Purple, and Rain Man, Guber clearly knows a lot about telling a good story, but he emphasizes that you don’t have to be a professional to tell a moving story. Guber gives some guidelines for what makes a successful leader story:

• It Has a Goal. Purposeful stories have a call to action. Leaders tell stories to achieve something. They are clear in

their minds what they want followers to feel, think, and do because of the story. When Guber started as head of Sony Pictures Entertainment, he says the job of pulling together a disparate group of people spread across the country and overseas seemed insur- mountable. He told the story from the film Lawrence of Arabia, where T. E. Lawrence pulls all the Arab tribal leaders together, to inspire employees to reclaim their heritage and pull together as “one tribe.”

• It Is Authentic. The leader has to be motivated by the goal, or it will be impossible to motivate and inspire followers. Being personally con- nected to the story enables the teller to connect listeners to it. Good story- tellers don’t follow a script and don’t always stay on point. They some- times shift the story if needed to emotionally bond with the listener and get the point across.

• It Is Targeted to the Audience. Build your story about “what’s in it for them.” The leader has to know his or her “audience” (followers) to

incorporate their interests into the story. By demonstrating that you are interested in what concerns fol- lowers, you change passive listeners into active participants in the story.

WHY IS STORYTELLING SO IMPORTANT? Without stories, leaders have only “transactional elements and no relation- ship” with followers, says Guber. In Tell to Win, Guber uses not only his own experiences but those of more than 90 others leaders, including famed basket- ball coach and motivational speaker Pat Riley; Chad Hurley, cofounder and CEO of YouTube, and former U.S. president Bill Clinton, who have used purposeful stories to drive their success. Reading about how these leaders use stories gives a clear sense that a good story can be very simple and can come from anywhere. As Guber says, “Anyone can do it, and everyone does do it!” The key for leaders it to do it purposefully.

Source: Connect to Win, by Peter Guber, is pub- lished by Crown Business.

Stories are the single most pow- erful weapon in a leader’s arsenal. Howard Gardner, psychologist and author of Leading Minds

hu tte rs to ck .c om

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COMMUNICATING TO PERSUADE AND INFLUENCE Stories are particularly useful tools for persuading and influencing people. Leaders don’t communicate just to convey information. They use communication skills to sell others on the vision and influence them to behave in ways that achieve goals and help accomplish the vision.

The ability to persuade others is more critical today than ever before. The command-and-control mindset of managers telling people what to do and how to do it is gone. Employees don’t just want to know what they should do but why they should do it. In addition, with new collaborative ways of working, many lea- ders are involved in situations where lines of authority are blurred. Companies such as Union Bank of California, Gerdau Ameristeel, and IBM are adding training programs that help people learn how to lead by influence rather than command.39

Leaders can follow four steps to practice the art of persuasion:40

1. Listen first. A study published in the Journal of Research in Personality shows that when people feel that they have been listened to by someone trying to influence them, their liking of, trust in, and commitment to that person increases.41 Good lea- ders know that being attentive to others’ needs and emotions is the first step toward influencing them. They realize that most people can’t hear what you have to say until they have the chance to say what is on their minds. Leaders ask questions and listen actively and supportively to build rapport, find common ground, and get a grasp on how followers may react to their ideas and proposals.42

2. Establish credibility. A leader’s credibility is based on the leader’s knowledge and expertise as well as his or her relationships with others. When leaders have demonstrated that they make well-informed, sound decisions, followers have confidence in their expertise. Leaders also build credibility by listening to others, establishing good relationships, and showing that they have others’ best interests at heart.

3. Build goals on common ground. To be persuasive, leaders describe how what they’re requesting will benefit others as well as the leader. For example, when David Zugheri wanted to switch to a primarily paperless system at First Houston Mortgage, he emphasized to employees that storing customer records electronically meant they could now work from home when they needed to care for a sick child, or take a vacation and still keep track of critical accounts. “I could literally see their attitudes change through their body language,” Zugheri says.43 When leaders can’t find common advantages, it’s a good signal that they need to adjust their goals and plans.

4. Make your position compelling to others. Leaders appeal to others on an emo- tional level by using symbols, metaphors, and stories to express their messages rather than relying on facts and figures alone. By tapping into the imaginations of their followers, leaders can inspire people to accomplish amazing results. At National Grange Mutual, a property–casualty insurance company, leaders in the claims unit picked up on a statement made by one of the company’s inde- pendent agents to appeal to people’s emotions and imaginations. When discuss- ing how the claims unit should relate to customers, the agent said, “I want my customers to feel your arm go around them when they have a claim.” Leaders used this evocative image to focus employees on reengineering the claims pro- cess to provide better, faster, more caring service.44

NEW LEADER ACTION MEMO As a leader, you can increase your influence by listening first to build trust and find common ground and by establishing your credibility based on knowledge and skills. You can show how your plans will benefit followers to gain their support.

274 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Persuasion is a valuable communication process that individuals can use to lead others to a shared solution or commitment. To be persuasive and act as communica- tion champions, leaders must communicate frequently and easily with others in the organization. Yet for some individuals, communication experiences are unrewarding, so they may consciously or unconsciously avoid situations where communication is required.45 The term communication apprehension describes this avoidance behavior and is defined as “an individual’s level of fear or anxiety associated with either real or anticipated communication with another person or persons.”46

SELECTING THE CORRECT COMMUNICATION CHANNEL One key to effective communication is selecting the right channel for relaying the message. A channel is a medium by which a communication message is carried from sender to receiver. A leader may discuss a problem face-to-face, use the tele- phone, write a memo or letter, use e-mail, send a text message, post a message on a blog or Web page, or put an item in a newsletter, depending on the nature of the message.

The Continuum of Channel Richness Research has attempted to explain how leaders select communication channels to enhance communication effectiveness.47 Studies have found that channels differ in their capacity to convey information. Channel richness is the amount of information that can be transmitted during a communication episode. The channels available to leaders can be classified into a hierarchy based on information richness, as illustrated in Exhibit 9.6.

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to complete the interactive questionnaire.

EXHIBIT 9.6 A Continuum of Channel Richness

Channel a medium by which a com- munication message is car- ried from sender to receiver

Channel richness the amount of information that can be transmitted during a communication episode

CHAPTER 9 LEADERSHIP COMMUNICATION 275

The richness of an information channel is influenced by three characteristics: (1) the ability to handle multiple cues simultaneously; (2) the ability to facilitate rapid, two-way feedback; and (3) the ability to establish a personal focus for the communication. Face-to-face discussion is the richest medium because it permits direct experience, multiple information cues, immediate feedback, and personal focus. Face-to-face discussions facilitate the assimilation of broad cues and deep, emotional understanding of the situation. Tony Burns, former CEO of Ryder Sys- tems, always preferred handling things face-to-face. “You can look someone in the eyes,” he explains. “You can tell by the look in his eyes or the inflection of his voice what the real problem or question or answer is.”48 Telephone conversations are next in the richness hierarchy. Eye contact, gaze, posture, and other body language cues are missing, but the human voice still carries a tremendous amount of emo- tional information.

Electronic messaging through e-mail, text messages, and social media such as Twitter is increasingly being used for communications that were once handled over the telephone. Although these channels lack both visual and verbal cues, they allow for rapid feedback and can be personalized. Blogs provide a way to get infor- mation to a wide audience and also permit rapid feedback.49

Print media such as notes and letters can be personalized, but they convey only the cues written on paper and are slow to provide feedback. Impersonal written media, including fliers, bulletins, and standard computer reports, are the lowest in richness. The channels are not focused on a single receiver, use limited information cues, and do not permit feedback.

Each communication channel has advantages and disadvantages, and each can be an effective means of communication in the appropriate circumstances.50 Chan- nel selection depends on whether the message is routine or nonroutine. Routine communications are simple and straightforward, such as a product price change. Routine messages convey data or statistics or simply put into words what people already understand and agree on. Routine messages can be efficiently communi- cated through a channel lower in richness. Written or electronic communications also are effective when the audience is widely dispersed or when the communication is “official” and a permanent record is required.51 On the other hand, nonroutine messages typically concern issues of change, conflict, or complexity that have great potential for misunderstanding. Nonroutine messages often are characterized by time pressure and surprise. Leaders can communicate nonroutine messages effec- tively only by selecting a rich channel.

Leaders should select a channel to fit the message. Following layoffs, for exam- ple, people are fearful and worried about their own jobs. Many leaders, not know- ing what to say, send out a written notice and hide in their offices. Good leaders, on the other hand, know face-to-face communication is the way to keep morale and productivity high. At one construction company that had to lay off employees, the CEO called employees together and told them how the mortgage crisis and down- turn in the housing market was affecting their company. He acknowledged that he couldn’t promise there wouldn’t be more layoffs, but as he explained the situation the emotions in the room became calmer because people felt they knew what was going on.52 Particularly in times of change, if people don’t hear what’s happening from leaders, they rely on rumors and will often assume the worst.53

When a message is highly important, leaders often use redundant communica- tions by sending the same message using different channels. For example, one leader explained a request to an employee in person, then immediately composed

NEW LEADER ACTION MEMO As a leader, you can choose rich forms of communication, such as face-to-face or the telephone, when an issue is complex, emotionally charged, or especially important. For a routine, straightforward message, you can use a written or electronic form of communication.

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a follow-up e-mail to the same employee that summarized the request in writing. For companywide changes, leaders might hold small group sessions to talk with employ- ees about a new policy, post an article on the intranet and in the newsletter, and use social media to make sure everyone gets the information. By using redundant commu- nication, saying the same thing more than once via multiple channels, leaders add weight to the message and keep the issue at the top of employees’ minds.54

Most leader communication by its very nature is composed of nonroutine mes- sages. Although leaders make good use of all channels, they don’t let anything substi- tute for the rich face-to-face channel when important issues are at stake. However, some companies, such as Cisco Systems, are also using new forms of electronic com- munication to enable rich, ongoing conversations across the organization.

IN THE LEAD John Chambers, Cisco Systems John Chambers knows that effective organizational communication happens when leaders talk with employees, not just to them. To transform communication into a two-way conver- sation, Cisco implemented several innovative strategies using state-of-the-art technology.

Cisco uses its own next-generation video conferencing, called Telepresence, to facilitate interactive conversations among leaders and employees all across the organization. Telepre- sence is a three-screen system that simulates in-person meetings by beaming video feeds between locations. This allows for a natural dialogue among people, no matter the time, place, or type of computer system. It also allows people to look one another in the eye, overcoming one of the primary limitations to most electronic communication channels.55

Leaders at Cisco also keep in touch with employees using other communication technologies. Chambers, for example, records a video blog about once a month to deliver brief, improvisational messages and invite feedback from employees via video or text messaging. Social media is also an important part of Cisco’s commu- nications strategy.56 Social media will be discussed later in this chapter.

Effectively Using Electronic Communication Channels Electronic communication has become a fact of life in today’s organizations. New technologies provide highly efficient ways of communicating and can be particu- larly useful for routine messages. Text messaging, which allows people to share shorthand messages instantly, has rapidly grown in use and has become more com- mon than e-mail in some organizations. Many of today’s leaders also use blogs to keep in closer touch and rebuild trust among employees, customers, shareholders, and the public.

Electronic communication has many advantages, but there are disadvantages as well. The proliferation of electronic media has contributed to poorer communica- tion in many organizations. Employees who work in offices down the hall from one another will often send an e-mail or text message rather than communicating face-to-face. One employee reported that he was fired via e-mail—by a manager who sat five feet away in the same office.57 Even for less traumatic messages, elec- tronic methods can increase the potential for communication errors. Leaders can come across as sounding cold, arrogant, or insensitive when they attempt to discuss

CHAPTER 9 LEADERSHIP COMMUNICATION 277

delicate or complex issues via e-mail. Things that might be handled smoothly in a face-to-face conversation or over the phone turn into massive problems by fostering resentment, bitterness, and hard feelings.58

Another equally disturbing concern, one psychiatrist argues, is that the growing use of technology for communicating, particularly social media, has created hidden problems for both individuals and organizations by depriving people of the “human moments” that are needed to energize people, inspire creativity, and support emo- tional well-being.59 People need to interact with others in physical space to build the connections that create great organizations. Electronic communication is here to stay, and the key for leaders is to benefit from the efficiencies of new technolo- gies while preventing their unintended problems. Here are some tips for effectively using electronic communication:

• Combine high-tech and high-touch. Never allow electronic communication to take the place of human connections. People who work together should meet face-to-face on a regular basis, and leaders should get to know their followers in real as well as virtual space. Many companies that use virtual workers require that they come into the office at least once a month for unstructured face time.60 A real-estate developer in Boston has a free-pizza day once a week when widely scattered workers can come by, sit around the table in his office, and just talk.61

• Consider the circumstances. People who know one another well and have worked together a long time can typically communicate about more complex issues via electronic means than can people who have a new working relationship.62 When people have a long-term working relationship, there is less potential for misunderstandings and hard feelings. In addition, when all parties involved have a good grasp of the issues being discussed, electronic channels can be used effectively. A leader of a longstanding, well-functioning team could thus use e-mail more extensively than the leader of a team that has just been formed.

• Think twice before you hit “Send.” Many people feel pressured to respond to electronic messages quickly, which can create unintended problems.63 Citigroup recently sent a memo to all employees reminding them to “think before writing, read before sending.”64 Slow down and consider whether the message is some- thing you want out there in cyberspace where anyone might read it. Never send an electronic message when you are angry or upset. Always read your messages at least twice.

Exhibit 9.7 lists some further dos and don’ts concerning subjects appropriate for electronic mail.

NONVERBAL COMMUNICATION Leaders don’t just communicate in words. Leaders are watched, and their appearance, behavior, actions, and attitudes are symbolic messages to others. Indeed, nonverbal communication, that is, messages transmitted through actions, behavior, facial expressions, and tone of voice, accounts for over one-half of the entire message received in a personal encounter.65 Even the selection of a communi- cation channel can convey a symbolic message. In other words, people attach mean- ing to the channel itself. Reports and memos typically convey formality and legitimize

NEW LEADER ACTION MEMO As a leader, you can avoid letting electronic communica- tions become a complete sub- stitute for human interactions. You can resist the urge to criticize or complain in an electronic message, and never send an e-mail when you are angry or upset.

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Nonverbal communication messages transmitted through action and behavior

a message. Personal visits from a leader are interpreted as a sign of teamwork and caring.66

Many people don’t realize that they are communicating all the time, without say- ing a word, by their facial expressions, body language, and actions.67 Consider the manager who thought his new boss disliked him and didn’t appreciate his hard work and commitment. “I see her talking to other managers, but she never talks to me,” he told a friend, wondering if he should start looking for another job. When he finally asked his new boss what he could do to improve the relationship, the new leader was surprised. She told him that she considered him one of her most trusted managers and had been thankful to have one person she didn’t have to watch over all the time. The new leader had been so busy that she didn’t realize her nonverbal communication was sending an inaccurate message to a valued employee.68

Leaders strive to be aware of what they signal to others in addition to verbal messages. Research suggests that if there is a discrepancy between a person’s verbal and nonverbal communication, the nonverbal is granted more weight by the inter- preter.69 Moreover, judgments based on nonverbal communication can occur at lightning speed. One study suggests that people form an opinion based on body lan- guage within 115 milliseconds!70 In interpreting a leader’s nonverbal cues, fol- lowers determine the extent to which a leader’s actions correspond with his or her

EXHIBIT 9.7 Dos and Don’ts of Electronic Mail

• Use e-mail to set up meetings and send agenda materials, to recap spoken conversations, or to follow up on information already discussed face-to-face.

• Keep e-mail messages short and to the point. Many people read e-mail on handheld devices, which have small screens.

• Use e-mail to transmit standard reports. • Act like a newspaper reporter. Use the subject line to grab the reader’s attention and reflect what

the message is about. Put the most important information in the first paragraph. Answer any ques- tions—who, what, when, where, why, and how—that are pertinent.

• Consider making a quick phone call to clear up confusion rather than setting off a barrage of back- and-forth e-mail messages.

Don’t

• Use e-mail to discuss something with a colleague who sits across the aisle or down the hall from you. Take the old-fashioned approach of speaking to each other.

• Say anything negative about a boss, friend, or colleague via e-mail. And don’t forward the negative comments of others.

• Use e-mail to start or perpetuate a feud. If you get an e-mail that tempts you to respond in a scathing manner, stop yourself. You may be misinterpreting the message. Even if you’re not, take the high road.

• Write anything in an e-mail you wouldn’t want published in a newspaper. E-mail with sensitive or potentially embarrassing information has an uncanny way of leaking out.

• Begin responding to e-mail messages on your smartphone’s tiny keyboard the minute you get out of a meeting. Get back to your office, laptop, or tablet, where you can craft a better response in less time.

Sources: Based on “15 Dos and Don’ts” box in Andrea C. Poe, “Don’t Touch That ‘Send’ Button,” HR Magazine (July 2001), pp. 74–80; Michael Goldberg, “The Essential Elements of E-Mail,” CIO (June 1, 2003), p. 24; Mary Lynn Pulley and Jane Hilberry, Get Smart! How E-Mail Can Make or Break Your Career and Your Organization (Colorado Springs, CO: Get Smart! Publishing, 2007); and “The Management Tip: 3 Ways to Battle Email Overload,” Harvard Business Review (January 17, 2013), http://hbr.org/tip/2013/01/17 /2-ways-to-battle-email-overload (accessed April 29, 2013).

NEW LEADER ACTION MEMO As a leader, you can symbolize important messages through your appearance, body lan- guage, facial expressions, and daily actions. You can be more effective by using manage- ment by wandering around. You can get out and mingle with followers and customers to learn about their ideas, problems, and needs through informal observation and conversation.

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verbal messages. If a leader talks about customer service but spends no time with customers, followers would likely place little value on service. If a leader talks about valuing employee feedback but stays in her office with the door closed most of the time, followers will doubt the sincerity of her words. One way leaders non- verbally communicate the value of feedback is by practicing management by wan- dering around (MBWA).71 MBWA means that leaders leave their offices and speak directly to employees as they work. For example, Thomas Swidarski, CEO of Diebold, which makes automatic teller machines, personally drops by employees’ desks to ask about their work or see what’s on their minds.72 These impromptu encounters send symbolic positive messages to followers that leaders care about their ideas, opinions, and feelings.

CURRENT COMMUNICATION CHALLENGES Two current challenges facing leaders are using social media and developing skills for communicating in a crisis.

Leadership via Social Media Everyone knows social media, especially Facebook and Twitter, have changed the way people carry on their social lives. Now they are changing the way people inter- act in the office too. Social media refers to a variety of Internet-based applications, including social networking, wikis, blogs, and so forth, that allow the creation and sharing of user generated content. Kaiser Permanente uses an internal social media platform called IdeaBook that supports blogs, wikis, online video, and chat rooms and provides a way for people to meet and carry on conversations in virtual work spaces.73 When leaders at Internet shoe retailer Zappos realized the economic downturn was hurting their business, CEO Tony Hsieh chose social media to com- municate with people about the need to lay off employees. Wanting to get the word out quickly to alleviate stress and uncertainty, Hsieh used redundant communica- tion, as defined earlier. He announced the decisions and the offer of generous sever- ance packages in an e-mail, on his blog, and with Twitter. Employees being let go were notified personally. It was a difficult time, but the response to how leaders handled the situation from both departing staffers and those remaining was gener- ally positive.74

Tony Hsieh was an early adopter of Twitter, but leaders in general have been slow to embrace all forms of social media. General Electric CEO Jeffrey Immelt, for example, tweeted for the first time in September 2012, prompting this response: “@JeffImmelt how come my grandfather got on twitter before you?” Bill George, former Medtronic CEO and a professor at Harvard Business School, says leaders need to consider using social media an important part of their job description and a tool for being a better leader. “People want CEOs who are real. They want to know what you think,” he says.75

IBM’s Institute for Business Value interviewed 1,700 top executives and found that they believe “the trend toward openness” will have the greatest impact on their business and job in coming years. People are demanding closer personal relation- ships with leaders and more open and honest communication. Social media directly supports the trend toward openness and transparency and gives leaders a new way to connect and build relationships with employees all across the organization and around the world.76 When people feel that they belong to a community with shared

280 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Social media Internet-based applications, including social networking, wikis, blogs, and so forth, that allow the creation and sharing of user generated content.

values their attachment to the organization increases. Leaders should recognize that in today’s world, particularly for younger employees, “community” is often built through social media.

Being Crisis-Ready Communication is a key part of a leader’s job, but at no time is it more crucial than during times of rapid change, uncertainty, or crisis. Everyone hears about the major crises that affect organizations, such as the terrorist bombing at the 2013 Boston Marathon, Toyota’s massive 2010 vehicle recall, or the 2011 tsu- nami and nuclear disaster in Japan, but leaders encounter small crises every day, such as the loss of computer data, charges of racial discrimination, or the need for downsizing.

To be prepared for communicating in a crisis, leaders can develop four skills:77

1. Stay calm. Perhaps the most important part of a leader’s job in a crisis situa- tion is to absorb people’s fears and uncertainties. “You do not pass uncer- tainty down to your team members,” said Eugene Kranz, the NASA flight director charged with returning the crippled Apollo 13 spacecraft safely to earth in 1970. “No matter what is going on around you, you have to be cooler than cool.”78

2. Be visible and supportive. Many leaders underestimate just how important their presence and support is during a crisis.79 Being a leader means stepping out immediately, both to reassure followers and respond to public concerns.

3. Tell the truth. Leaders do their best to determine the facts, and then “get the awful truth out” to employees and the public as soon as possible.80 Rumor control is critical. Duke University provides an example of the importance of getting the truth out.

IN THE LEAD Duke University Duke University was thrust into crisis when three members of its lacrosse team were charged with beating, strangling, and raping an African-American exotic dancer the team had hired for a party where team members were drinking heavily. Duke’s reputation had already been tarnished by previous incidents where leaders had failed to respond quickly and appropriately, so handling this crisis could determine whether the university recovered its good name or sank further into the mud.

Duke president Richard Brodhead immediately accepted responsibility for the inci- dent, offered an apology, and began steps for taking corrective action. He indicated that the facts of the rape case were not established and that the players were pre- sumed innocent until proven guilty (charges against all three players were eventually dropped when the victim’s story changed). However, Brodhead acknowledged that sev- eral members of the lacrosse team had clearly acted inappropriately. From the time the incident happened until the end of the case, Brodhead communicated regularly through various media with students and parents, alumni, employees, and the public. As he explained on 60 Minutes, Brodhead realized he “had to take personal leadership of this issue from day one.”81

NEW LEADER ACTION MEMO As a leader, you can learn to be an effective crisis commu- nicator. By remaining calm and focused, you can acknowledge people’s concerns and fears, provide accurate and up- to-date information, and help people see a better tomorrow.

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4. Communicate a vision for the future. People need to feel that they have some- thing to work for and look forward to. Moments of crisis present excellent opportunities for leaders to communicate a vision for the future that taps into people’s emotions and unites them toward common goals.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • Communicating effectively is a crucial skill for leaders. Leaders are com-

munication champions who inspire and unite people around a common sense of purpose and identity. They lead strategic conversations that get people talking across boundaries about the vision, key strategic themes, and the values that can help the group or organization achieve desired outcomes.

• Six elements that facilitate strategic conversations are an open communication climate, asking questions, active listening, dialogue, candor, and using stories. Open communication is essential for building trust, and it paves the way for more opportunities to communicate with followers, thus enabling the organiza- tion to gain the benefits of all employees’ minds. However, leaders must be active listeners to identify strategic issues and build productive relationships that help the organization succeed, and they must be straightforward and can- did in communicating with followers.

• When active listening and candor spread throughout a group, a type of com- munication referred to as dialogue occurs. Through dialogue, people discover common ground and together create a shared meaning that enables them to understand each other and share a view of the world. Using imagery and stories in communication helps leaders connect with people on an emotional level and be more influential.

• Leader communication is purpose-directed, and an important element is per- suading others to act in ways that achieve goals and accomplish the vision. Four steps for practicing the art of persuasion are to listen first, establish credi- bility, build goals on common ground, and make your position compelling to others. Leaders select the appropriate communication channels, send redundant communications to reinforce important messages, and use nonverbal as well as verbal communication.

• Electronic communication channels present new challenges for leader com- munication. Electronic channels can be very advantageous if used appropri- ately, but their use increases the potential for communication errors, and these channels are not effective for complex or sensitive messages.

• Current communication challenges leaders face are using social media and com- municating effectively in times of uncertainty or crisis. Leaders should consider using social media a part of their job because it can be an important aspect of an open communication climate. Four critical skills for communicating in a cri- sis are to remain calm, be visible, “get the awful truth out,” and communicate a vision for the future.

Tw itt er

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DISCUSSION QUESTIONS 1. Why do you think storytelling is such a powerful means of communicating for a leader?

How is active listening related to storytelling?

2. What does it mean to say that leaders use communication to act as “sensegivers”? How do you think this differs from conventional management communication?

3. Board members at some companies are opening the lines of communication so share- holders can voice their concerns about executive compensation and corporate gover- nance. Do you think this is a good idea? What might be some risks associated with this type of open communication?

4. A manager in a communication class remarked, “Listening seems like minimal intrusion of oneself into the conversation, yet it also seems like more work.” Do you agree or dis- agree? Discuss.

5. How does dialogue differ from discussion? Give an example of each from your experience.

6. Some senior executives believe they should rely on written information and computer reports because these yield more accurate data than face-to-face communications do. Do you agree? Discuss.

7. What communication channel would you choose to communicate an impending compa- nywide layoff? News about the company picnic? New corporate quality goals that will require significant changes in how your subordinates perform their tasks? Explain your choices.

8. How do leaders use communication to influence and persuade others? Think of some- one you have known who is skilled in the art of persuasion. What makes this person an effective communicator?

9. How might leaders use social media to create a sense of community among employees? What do you think are some advantages and disadvantages of a company using social media to communicate with employees?

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LEADERSHIP AT WORK Listen Like a Professional The fastest way to become a great listener is to act like a professional listener, such as a clin- ical psychologist who uses listening to heal another person. Therapists drop their own point of view to concentrate on the patient’s point of view. The therapist listens totally, drawing out more information rather than thinking about a response.

The next time you are in a conversation in which the other person talks about some problem or concern, practice professional listening by doing the following:

1. Hold a steady gaze on the person’s left eye (not the nose or face, but the left eye)—use a soft gaze, not a hard stare.

2. Remove your thoughts and opinions from the conversation—quell your mind chatter and your desire to say something in response.

3. Suspend judgment—rather than critically analyzing what is being said, feel empathy as if you are walking in the other person’s shoes.

4. Draw out the other person’s thoughts with brief questions and paraphrasing. Repeat the professional listening approach at least three times with different people to get comfortable with it.

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List your thoughts on how the other people responded to your listening, and what it felt like to you.

Other person responded:

What I felt:

In Class: The instructor can divide students into pairs—listener and speaker—in class to practice this exercise. The “speaking” students can be asked to talk about some small prob- lem or annoyance they encountered in the previous day or two. The “listening” students can be given instructions to not speak during the first trial and instead just maintain a soft gaze into the speaker’s left eye and respond only with body language (facial expressions and nods). The speaking students should continue until they have nothing more to say or until they feel an emotional shift and the problem seems to have disappeared. After students switch roles and play both speaker and listener, the instructor can ask the class for percep- tions of what happened and what they were feeling during the conversation.

It works well to have the students choose a second pairing and redo the exercise with a new problem. The only difference the second time is that the “listener” role is given fewer restric- tions, so the listener can make brief comments such as to paraphrase or ask a short question. The listeners, however, should keep spoken comments to a minimum and definitely should not offer their own ideas or point of view. After the students finish, the instructor can gather opi- nions about what the experience was like for both the speaker and the listener. Key questions include the following: What did it feel like to listen rather than respond verbally to what another person said? What is the value of this professional listening approach? In what situations is

284 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

professional listening likely to be more or less effective? If the instructor desires, the exercise can be done a third time to help students get more comfortable with a true listening role.

Source: Adapted from Michael Ray and Rochelle Myers, Creativity in Business (New York: Broadway Books, 2000), pp. 82–83.

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C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS The Superintendent’s Directive Educational administrators are bombarded by requests for innovation at all educational levels. Programs to upgrade math, science, and social science education, state accountability plans, new approaches to administration, and other ideas are initiated by teachers, adminis- trators, interest groups, reformers, and state regulators. In a school district, the superinten- dent is the key leader; in an individual school, the principal is the key leader.

In the Carville City School District, Superintendent Porter has responsibility for 11 schools—eight elementary, two junior high, and one high school. After attending a man- agement summer course, Porter sent the following e-mail to the principal of each school:

“Please request that teachers in your school develop a set of performance objectives for each class they teach. A consultant will be providing instructions for writing the perfor- mance objectives during the August 10 in-service day. The deadline for submitting the performance objectives to my office is September 21.”

Mr. Weigand, principal of Earsworth Elementary School, forwarded Porter’s e-mail to his teachers with the following message:

“Please see the forwarded e-mail from Superintendent Porter. As he explains, you will need to write performance objectives for each course you teach. These are due one month from today. This afternoon, during the in-service meeting, you will receive train- ing on how to write these performance objectives.”

After receiving this e-mail, several teachers at the elementary school responded with a flurry of hastily written e-mail responses. One well-respected and talented teacher wrote the following e-mail, accidentally sending it to Mr. Weigand instead of her colleagues:

“This is nonsense! I should be spending my time focused on the lesson plan for the new advanced English class the board of education approved. Porter is clueless and has no idea the demands we are facing in the classroom. We never even hear from him until he wants us to complete some empty exercise. I am going to start looking for a school district that values my time!”

Mr. Weigand was stunned by this e-mail, wondering if he was close to losing a valuable teacher who was admired by her peers and others in the school system. He knew this e-mail had been written in haste and that this teacher would be embarrassed to know that he had received it. He was concerned that other teachers may have reacted in similar ways to his e-mail. He also wondered how to respond to the angry e-mail and how to improve morale at the start of a new school year.

QUESTIONS

1. Evaluate the e-mail communications of Mr. Porter and Mr. Weigand. To what extent are they communicating effectively about the new performance objectives? Explain. If you were a teacher, how would you have felt after receiving the e-mail? Why?

2. If you were Mr. Weigand, how would you respond to the angry teacher? Be specific about how you would communicate with her and what you would say. How could he

CHAPTER 9 LEADERSHIP COMMUNICATION 285

have communicated differently about the performance objectives to influence the tea- chers more positively?

3. Identify the mistakes that the teacher made when composing and sending her e-mail message.

Hunter-Worth Christmas was fast approaching. Just a short while ago, Chuck Moore, national sales man- ager for Hunter-Worth, a New York–based multinational toy manufacturer, was confident the coming holiday was going to be one of the company’s best in years. At a recent toy expo, Hunter-Worth unveiled a new interactive plush toy that was cuddly, high-tech, and tied into a major holiday motion picture expected to be a smash hit. Chuck had thought the toy would do well, but frankly, the level of interest took him by surprise. The buyers at the toy fair raved, and the subsequent pre-order volume was extremely encouraging. It had all looked so promising, but now he couldn’t shake a sense of impending doom.

The problem in a nutshell was that the Mexican subsidiary that manufactured the toy couldn’t seem to meet a deadline. Not only were all the shipments late so far, but they fell well short of the quantities ordered. Chuck decided to e-mail Vicente Ruiz, the plant man- ager, about the situation before he found himself in the middle of the Christmas season with parents clamoring for a toy he couldn’t lay his hands on.

In a thoroughly professional e-mail that started with a friendly “Dear Vicente,” Chuck inquired about the status of the latest order, asked for a production schedule for pending orders, and requested a specific explanation as to why the Mexican plant seemed to be hav- ing such difficulty shipping orders out on time. The reply appeared within the hour, but to his utter astonishment, it was a short message from Vicente’s secretary. She acknowledged the receipt of his e-mail and assured him the Mexican plant would be shipping the order, already a week late, in the next 10 days.

“That’s it,” Chuck fumed. “Time to take this to Sato.” In the message to his boss, he prefaced his original e-mail and the secretary’s reply with a terse note expressing his growing concern over the availability of what could well be this season’s must-have toy. “Just what do I have to do to light a fire under Vicente?” he wrote. He then forwarded it all to his supervisor and friend, Michael Sato, the executive vice president for sales and marketing.

Next thing he knew, he was on the phone with Vicente—and the plant manager was furious. “Señor Moore, how dare you go over my head and say such things about me to my boss?” he sputtered, sounding both angry and slightly panicked. It seemed that Michael had forwarded Chuck’s e-mail to Hunter-Worth’s vice president of operations, who had sent it on to the Mexican subsidiary’s president.

That turn of events was unfortunate, but Chuck wasn’t feeling all that apologetic. “You could have prevented all this if you’d just answered the questions I e-mailed you last week,” he pointed out. “I deserved more than a form letter—and from your secretary, no less.”

“My secretary always answers my e-mails,” replied Vicente. “She figures that if the prob- lem is really urgent, you would pick up the phone and talk to me directly. Contrary to what you guys north of the border might think we do take deadlines seriously here. There’s only so much we can do with the supply problems we’re having, but I doubt you’re interested in hear- ing about those.” And Vicente hung up the phone without waiting for a response.

Chuck was confused and disheartened. Things were only getting worse. How could he turn the situation around?

QUESTIONS

1. Based on Vicente Ruiz’s actions and his conversation with Chuck Moore, what differences do you detect in cultural attitudes toward communications in Mexico as compared with the United States? Is understanding these differences important? Explain.

286 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

2. What was the main purpose of Chuck’s communication to Vicente? To Michael Sato? What factors should he have considered when choosing a channel for his communica- tion to Vicente? Are they the same factors he should have considered when communi- cating with Michael Sato?

3. If you were Chuck, what would you have done differently? What steps would you take at this point to make sure the supply of the popular new toy is sufficient to meet the anticipated demand?

Sources: Based on Harry W. Lane, Charles Foster Sends an E-mail (London, Ontario: Ivey Publishing, 2005); Frank Unger and Roger Frankel, Doing Business in Mexico: A Practical Guide on How to Break into the Market (Council on Australia Latin America Relations and the Department of Foreign Affairs and Trade, 2002), pp. 24–27; and Ignacio Hernandez, “Doing Business in Mexico—Business Etiquette,” MexGrocer.com, www.mexgrocer.com/business-in-mexico.html (accessed September 18, 2006).

REFERENCES 1. Ian Urbina, “Workers on Doomed Rig Voiced Concern about Safety,”

The New York Times (July 22, 2010), p. A1.

2. AMA Enterprise, a division of American Management Association, 2012, reported in “Employees Are Clueless about What’s Going On at Work,” T D (June 2012), p. 23.

3. Studies from the Elliot Leadership Institute, reported in Louise van der Does and Stephen J. Caldeira, “Effective Leaders Champion Com- munication Skills,” Nation’s Restaurant News (March 27, 2006), p. 20; and Dennis Tourish, “Critical Upward Communication: Ten Commandments for Improving Strategy and Decision Making,” Long Range Planning 38 (2005), pp. 485–503.

4. Bernard M. Bass, Bass & Stogdill’s Handbook of Leadership, 3rd ed. (New York: The Free Press, 1990).

5. Henry Mintzberg, Managing (San Francisco: Berrett-Koehler Publish- ers, 2009); and Henry Mintzberg, The Nature of Managerial Work (New York: Harper & Row, 1973).

6. Mary Young and James E. Post, “Managing to Communicate, Communicating to Manage: How Leading Companies Communicate with Employees,” Organizational Dynamics (Summer 1993), pp. 31–43; and Warren Bennis and Burt Nanus, Leaders: The Strategies for Taking Charge (New York: Harper & Row, 1985).

7. This discussion is based on Charles Galunic and Immanuel Hermreck, “How to Help Employees ‘Get’ Strategy,” Harvard Business Review (December 2012), p. 24.

8. This discussion is based on Dennis A. Gioia and Kumar Chittipeddi, “Sensemaking and Sensegiving in Strategic Change Initiation,” Strategic Management Journal 12, no. 6 (September 1991), pp. 433–448; and Anne D. Smith, Donde Ashmos Plowman, and Dennis Duchon, “Everyday Sensegiving: A Closer Look at Successful Plant Managers,” The Journal of Applied Behavioral Science 46, no. 2 (June 2010), pp. 220–244.

9. Phillip G. Clampitt, Laurey Berk, and M. Lee Williams, “Leaders as Strategic Communicators,” Ivey Business Journal (May–June 2002), pp. 51–55.

10. General William E. “Kip” Ward, “Strategic Communication at Work,” Leader to Leader (Winter 2011), pp. 33–38.

11. Gary Hamel, “Killer Strategies That Make Shareholders Rich,” Fortune (June 23, 1997), pp. 70–84.

12. John Luthy, “New Keys to Employee Performance and Productivity,” Public Management (March 1998), pp. 4–8.

13. This discussion is based on Andrew Sobel, “Leading with Questions: Ask, Don’t Tell,” Leader to Leader (Winter 2013), pp. 24–29; “The

Power of Questions” (Practical Wisdom column), Leadership: The Journal of the Leader to Leader Institute (Spring 2005), pp. 59–60; and Quinn Spitzer and Ron Evans, “The New Business Leader: Socrates with a Baton,” Strategy & Leadership (September–October 1997), pp. 32–38.

14. Reported in Sobel, “Leading with Questions.”

15. Reported in Spitzer and Evans, “The New Business Leader: Socrates with a Baton.”

16. Based on Sobel, “Leading with Questions: Ask, Don’t Tell”; Steve Arneson, “People Leadership: Get to Know Your People Better,” Leadership Excellence (November 2010), p. 18; “The Power of Questions”; and Spitzer and Evans, “The New Business Leader: Socrates with a Baton.”

17. Sterling Newberry, “Difficult Communications: Going Beyond ‘I’ Statements,” Mediate.com (January 2003), http://www.mediate.com/ articles/redwing9.cfm (accessed July 6, 2009).

18. Kevin Clark, “Management Secrets of the NFL: The League’s Best Teams Share Front-Office Habits,” The Wall Street Journal (September 5, 2012), p. D7.

19. Fierce Inc. survey results reported in Phaedra Brotherton, “More Employee Input and Accountability Yield More Effective Practices,” T D (May 2012), p. 18.

20. Seth S. Horowitz, “The Science and Art of Listening,” The New York Times (November 9, 2012), http://www.nytimes.com/2012/11 /11/opinion/sunday/why-listening-is-so-much-more-than-hearing .html?_r=0 (accessed November 11, 2012).

21. Bernard T. Ferrari, “The Executive’s Guide to Better Listening,” McKinsey Quarterly no. 2 (2012), pp. 50–60; and Horowitz, “The Science and Art of Listening.”

22. Tom Peters, “Learning to Listen,” Hyatt Magazine (Spring 1988), pp. 16–21.

23. “Why I’m a Listener: Amgen CEO Kevin Sharer,” (interview), The McKinsey Quarterly no. 2 (April 2012), pp. 61–65.

24. Ibid.

25. David Bohm, On Dialogue (Ojai, CA: David Bohm Seminars, 1989).

26. Bill Isaacs, Dialogue and the Art of Thinking Together (New York: Doubleday, 1999); and “The Art of Dialogue,” column in Paul Roberts, “Live! From Your Office! It’s …” Fast Company (October, 1999), pp. 151–170.

27. Based on Glenna Gerard and Linda Teurfs, “Dialogue and Organizational Transformation,” in Kazimierz Gozdz, ed.,

CHAPTER 9 LEADERSHIP COMMUNICATION 287

Community Building: Renewing Spirit and Learning in Business (Pleasanton, CA: New Leaders Press, 1995).

28. Scott Kirsner, “Want to Grow? Hire a Shrink!” Fast Company (December–January 1998), pp. 68, 70.

29. This discussion is based in part on Jack Welch with Suzy Welch, Winning (New York: HarperBusiness, 2005), Chapter 2.

30. Reported in ibid.

31. E. Raudsepp, “Are You Properly Assertive?” Supervision (June 1992); and M. J. Smith, When I Say No, I Feel Guilty (New York: Bantam Books, 1975).

32. Based on Welch, Winning, Chapter 2.

33. Halley Bock, “Fierce Communication,” T D (November 2012), p. 80.

34. This discussion is based on David M. Boje, “Learning Storytelling: Storytelling to Learn Management Skills,” Journal of Management Education 15, no. 3 (August 1991), pp. 279–294; Peter Guber, “Telling Purposeful Stories: An Organization’s Most Under-Utilized Competency,” People & Strategy 34, no. 1 (2011), pp. 4–5; Alison Esse, “Response from The Storytellers to Peter Guber’s Article,” People & Strategy 34, no. 1 (2011), pp. 7–8; and David Fleming, “Narrative Leadership: Using the Power of Stories,” Strategy & Leadership 29, no. 4 (July–August 2001), pp. 34–36.

35. Howard Gardner, Leading Minds: An Anatomy of Leadership (New York: Basic Books, 1995).

36. Art Kleiner, “The Art of the Business Narrative” (an interview with Peter Guber), Strategy Business 63 (Summer 2011), http://www .strategy-business.com/article/00067?gko=3e7b3 (accessed April 29, 2013).

37. Example told in Fleming, “Narrative Leadership.”

38. Kleiner, “The Art of the Business Narrative.”

39. Erin White, “Theory & Practice: Art of Persuasion Becomes Key; Managers Sharpen Their Skills as Line of Authority Blurs,” The Wall Street Journal (May 19, 2008), p. B5.

40. This section is based on Jay A. Conger, “The Necessary Art of Persuasion,” Harvard Business Review (May–June 1998), pp. 84–95.

41. Reported in Tori Rodriguez, “How to Use Your Ears to Influence People,” Scientific American Mind (November–December 2012), p. 20.

42. Chris Musselwhite and Tammie Plouffe, “To Have the Most Impact, Ask the Right Questions,” Harvard Business Review Blog (March 1, 2013), http://blogs.hbr.org/cs/2012/11/to_have_the_most_impact _ask_qu.html (accessed April 26, 2013); Edward T. Reilly, “Influen- tial Leaders,” Leadership Excellence (January 2013), p. 10; and Stephen R. Covey, The 7 Habits of Highly Effective People (New York: Free Press, 2004).

43. Darren Dahl, “Trust Me: You’re Gonna Love This; Getting Employ- ees to Embrace New Technology,” Inc. (November 2008), p. 41.

44. John Guaspari, “A Shining Example,” Across the Board (May–June 2002), pp. 67–68.

45. J. C. McCroskey and V. P. Richmond, “The Impact of Communica- tion Apprehension on Individuals in Organizations,” Communication Quarterly 27 (1979), pp. 55–61.

46. J. C. McCroskey, “The Communication Apprehension Perspective,” in J. C. McCroskey and J. A. Daly, eds., Avoiding Communication: Shyness, Reticence, and Communication Apprehension (London: Sage Publications, 1984), pp. 13–38.

47. Robert H. Lengel and Richard L. Daft, “The Selection of Commu- nication Media as an Executive Skill,” Academy of Management Executive 2 (August 1988), pp. 225–232; and Richard L. Daft and Robert Lengel, “Organizational Information Requirements, Media Richness and Structural Design,” Managerial Science 32 (May 1986), pp. 554–572.

48. Ford S. Worthy, “How CEOs Manage Their Time,” Fortune (January 18, 1988), pp. 88–97.

49. John R. Carlson and Robert W. Zmud, “Channel Expansion Theory and the Experiential Nature of Media Richness Perceptions,” Academy of Management Journal 42, no. 2 (1999), pp. 153–170; and R. Rice and G. Love, “Electronic Emotion,” Communication Research 14 (1987), pp. 85–108.

50. Ronald E. Rice, “Task Analyzability, Use of New Media, and Effectiveness: A Multi-Site Exploration of Media Richness,” Organi- zational Science 3, no. 4 (November 1994), pp. 502–527.

51. Richard L. Daft, Robert H. Lengel, and Linda Klebe Treviño, “Message Equivocality, Media Selection and Manager Performance: Implications for Information Systems,” MIS Quarterly 11 (1987), pp. 355–368.

52. Laura Raines, “Going Forward after Layoffs: Leaders Need to Reassure Employees, Share Vision of Company’s Future,” The Atlanta Journal-Constitution (April 26, 2009), p. G1.

53. Quint Studor, “Case for Transparency,” Leadership Excellence (April 2010), p. 19.

54. Paul M. Leonardi, Tsedal B. Neeley, and Elizabeth M. Gerber, “How Managers Use Multiple Media: Discrepant Events, Power, and Timing in Redundant Communication,” Organization Science 23, no. 1 (January–February 2012), pp. 98–117.

55. Boris Groysberg and Michael Slind, “Leadership Is a Conversation,” Harvard Business Review (June 2012), pp. 75–84.

56. Ibid.

57. Anne Fisher, “Readers Weigh In on Rudeness and Speechmaking” (Ask Annie column), Fortune (January 10, 2000), p. 194.

58. Edward M. Hallowell, “The Human Moment at Work,” Harvard Business Review (January–February 1999), pp. 58–66; and Andrea C. Poe, “Don’t Touch That ‘Send’ Button!” HR Magazine (July 2003), pp. 74–80.

59. Hallowell, “The Human Moment at Work.”

60. Hallowell, “The Human Moment at Work”; Deborah L. Duarte and Nancy Tennant Snyder, Mastering Virtual Teams: Strategies, Tools, and Techniques That Succeed (San Francisco: Jossey-Bass, 2000).

61. Hallowell, “The Human Moment.”

62. Carlson and Zmud, “Channel Expansion Theory and the Experiential Nature of Media Richness Perceptions.”

63. Mary Lynn Pulley and Jane Hilberry, Get Smart! How E-Mail Can Make or Break Your Career and Your Organization (Colorado Springs, CO: Get Smart! Publishing, 2007).

64. Reported in Cassell Bryan-Low and Aaron Lucchetti, “George Carlin Never Would’ve Cut It at the New Goldman Sachs—Firms Ban Naughty Words in Emails; An ‘Unlearnable Lesson’ on Wall Street?” The Wall Street Journal (July 29, 2010).

65. Albert Mehrabian, Silent Messages (Belmont, CA: Wadsworth, 1971); and Albert Mehrabian, “Communicating without Words,” Psychology Today (September 1968), pp. 53–55.

66. Jane Webster and Linda Klebe Treviño, “Rational and Social Theories as Complementary Explanations of Communication Media Choices: Two Policy Capturing Studies,” Academy of Management Journal (December 1995), pp. 1544–1572.

67. Mac Fulfer, “Nonverbal Communication: How to Read What’s Plain as the Nose … or Eyelid … or Chin … on Their Faces,” Journal of Organizational Excellence (Spring, 2001), pp. 19–27.

68. Based on a story in Christopher Hegarty, How to Manage Your Boss (Mill Valley, CA: Whatever Publishing, 1982), pp. 58–59.

69. I. Thomas Sheppard, “Silent Signals,” Supervisory Management (March 1986), pp. 31–33; and Martha E. Mangelsdorf, “Business

288 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Insight (A Special Report); Executive Briefing: The Power of Nonverbal Communication” (an interview with Alex Pentland), The Wall Street Journal (October 20, 2008), p. R2.

70. Reported in Jane Jordan-Meier, “Appearances Do Matter: Leadership in a Crisis,” Leader to Leader (Fall 2012), pp. 16–20.

71. Thomas H. Peters and Robert J. Waterman Jr., In Search of Excellence (New York: Harper & Row, 1982); and Tom Peters and Nancy Austin, A Passion for Excellence: The Leadership Difference (New York: Random House, 1985).

72. Carol Hymowitz, “How to Lead after Sudden Rise,” The Wall Street Journal (May 8, 2006).

73. Vince Golla, interviewed by David Kiron, “Social Business at Kaiser Permanente: Using Social Tools to Improve Customer Service, Research and Internal Collaboration,” MIT Sloan Management Review (March 6, 2012), http://sloanreview.mit.edu/article/social-tools-improve-service -research-collaboration/ (accessed April 30, 2013).

74. Jeffrey M. O’Brien, “Zappos Knows How to Kick It,” Fortune (February 2, 2009), pp. 54–60.

75. Leslie Kwoh and Melissa Korn, “140 Characters of Risk: CEOs on Twitter,” The Wall Street Journal (September 26, 2012), p. B1.

76. Peter Korsten, “Lead via Connections,” Leadership Excellence (August 2012), p. 16.

77. This section is based on Leslie Wayne and Leslie Kaufman, “Leader- ship, Put to a New Test,” The New York Times (September 16, 2001), Section 3, pp. 1, 4; Jerry Useem, “What It Takes,” Fortune (November 12, 2001), pp. 126–132; Andy Bowen, “Crisis Procedures That Stand the Test of Time,” Public Relations Tactics (August 2001), p. 16; Matthew Boyle, “Nothing Really Matters,” Fortune (October 15, 2001), pp. 261–264; and Jordan-Meier, “Appearances Do Matter: Leadership in a Crisis.”

78. Quoted in Useem, “What It Takes.”

79. Stephen Bernhut, “Leadership, with Michael Useem” (Leader’s Edge interview), Ivey Business Journal (January–February 2002), pp. 42–43.

80. Ian I. Mitroff, “Crisis Leadership,” Executive Excellence (August 2001), p. 19.

81. John A. Fortunato, “Restoring a Reputation: The Duke University Lacrosse Scandal,” Public Relations Review 34 (2008), pp. 116–123.

CHAPTER 9 LEADERSHIP COMMUNICATION 289

Chapter 10: Leading Teams

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Turn a group of individuals into a collaborative team that achieves high performance through a shared mission and collective responsibility.

• Identify challenges associated with teamwork, and explain why people sometimes have negative feelings about working in a team.

• Lead a team to high performance by providing a compelling purpose and clear objectives, clarifying roles and responsibilities, designing the team in terms of size and diversity, giving team members decision authority, and providing support and coaching.

• Understand and handle the stages of team development, and know how to promote cohesiveness and shape productive team norms.

• Understand the challenges and benefits of virtual teams and the team leader behaviors that contribute to virtual team effectiveness.

• Handle conflicts that inevitably arise among members of a team.

CHAPTER OUTLINE 292 The Value of Teams

296 The Dilemma for Team Members

298 Leading a Team to High Performance

300 Team Processes

304 What Team Members Must Contribute

306 Leading a Virtual Team

309 Handling Team Conflict

In the Lead

295 Tony Brown and Alan Mulally, Ford Motor Company

302 Spring Company

307 Smart Balance

Leader’s Self-Insight

297 Individual or Team?

305 Are You a Contributing Team Member?

313 How Do You Handle Team Conflict?

Leader’s Bookshelf

299 Great Business Teams: Cracking the Code for Standout Performance

Leadership at Work

316 Team Feedback

Leadership Development: Cases for Analysis

317 Decision Time

319 Devereaux-Dering Group

C hris Rufer, the founder of Morning Star, a tomato processor with three factories that produce products for companies such as Heinz and Campbell Soup Company, believes if people can manage the complexities of their own

lives without a boss, there is no reason they can’t manage themselves in the workplace. Rufer founded Morning Star based on self-directed teamwork, but as the company grew from the original 24 colleagues (as employees are called) to around 400, problems occurred. Some people had trouble working in an environment with no bosses and no hierarchy. Handling the inevitable conflicts that arise in any workplace was a particular challenge. Thus, Rufer created the Morning Star Self-Management Institute to provide training for people in the principles and systems of self-management. Every colleague now goes through training, in small groups of 10 to 15 people, to learn how to work effectively as part of a team; how to handle the responsibilities of “planning, organizing, leading, and controlling” that are typically carried out by managers; how to balance freedom and accountability; how to understand and effectively communicate with others; and how to manage

291 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

conflicts. Response to and results of the program have been positive, but Rufer knows it will take ongoing effort and training to keep the wheels of self-directed teamwork rolling smoothly.1

Teams are becoming the basic building block of organizations, but teams present greater leadership challenges than does the traditional hierarchical organization. This chapter explores teams and team leadership. We define various types of teams, look at the dilemma of teamwork, and investigate what makes a high-performing team. The chapter then examines how teams develop, explores topics such as cohesiveness and team norms, and considers the various roles that team members must carry out for the team to function well. The new challenge of leading virtual teams is also discussed. The final part of the chapter looks at how to manage team conflict, including using negotiation.

THE VALUE OF TEAMS Teams are not right for every situation, but much work in organizations is interdepen- dent, which means that individuals and departments rely on other individuals and departments for information or resources in order to accomplish their work. When tasks are highly interdependent, a team can be the best approach for ensuring the level of coordination, information sharing, and exchange of materials necessary for successful task accomplishment. When they are effective, teams can provide benefits for both organizations and employees through higher productivity, quality improve- ments, greater flexibility and speed, a flatter management structure, increased employee involvement and satisfaction, and lower turnover.2

What Is a Team? A team is a unit of two or more people who interact and coordinate their work to accomplish a shared goal or purpose for which they are committed and hold them- selves mutually accountable.3 Several key features distinguish a team. For example, a team made up of linguists, psychologists, statisticians, and software engineers at Facebook had a clear purpose (shared goal) of redesigning Facebook’s ineffective search engine so it could better understand human (not just computer) language. Team members had to coordinate their efforts and work interdependently to investi- gate, design, test, and develop a new search engine. The development team was a distinct unit with membership separate from other teams. Members of the team worked together for a period of more than a year to complete the early coding and testing of a new search tool and are continuing their work to perfect the new search engine, which Facebook hopes can be competitive with search leader Google.4

A team is a group of people, but the two are not one and the same. People who do not interact regularly, such as those waiting in line at the company cafeteria or riding together in the elevator, do not compose a team. Even a group of employees whose work is related is not a team unless the members share a common purpose that requires them to depend on each other. In addition, the concept of teamwork implies that people sublimate their individual needs, desires, and egos and synthe- size their knowledge, skills, and efforts toward accomplishing a common goal. A professor, coach, or employer can put together a group of people and never build a team. Consider the Miami Heat basketball team. In the spring of 2010, LeBron James, Dwyane Wade, and Chris Bosh were the top scorers on their respec- tive basketball teams. The next year, they were all playing for the Miami Heat.

292 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Team a unit of two or more people who interact and coordinate their work to accomplish a shared goal or purpose

With that kind of talent, the team should have been tough for anyone to beat, but the Heat’s dream team opened with a humiliating loss and stumbled through the early weeks of the season. Star players who were used to being in charge at crunch time found themselves working at cross-purposes. Discussing the Heat’s loss to the New York Knicks, former Chicago Bulls player Steve Kerr said, “It was a total meltdown. It was, ‘I’m so talented, I’ll take over.’ They looked awful.”5

Individual stars don’t necessarily make a great team, in sports or in business. The Miami Heat struggled with issues that teams in all organizations face: How to get star performers to sublimate their egos and sacrifice their individual goals? How to bring together the right set of specialties and skills? How to define roles? How to promote cohesiveness and norms of collaboration? and How to create a team that is united in a common mission?6 This chapter’s Consider This illustrates the spirit and power of teamwork.

Consider Lessons from Geese

Fact 1: As each goose flaps its wings, it creates an “uplift” for the birds that follow. By flying in a “V” formation, the whole flock adds 71 percent greater flying range than if each bird flew alone. Lesson: People who share a common direction and sense of community can get where they are going quicker and easier because they are traveling on the thrust of one another.

Fact 2: When a goose falls out of formation, it suddenly feels the drag and resistance of flying alone. It quickly moves back into formation to take advantage of the lifting power of the bird immediately in front of it. Lesson: If we have as much sense as a goose, we stay in formation with those headed where we want to go. We are willing to accept their help and give our help to others.

Fact 3: When the lead goose tires, it rotates back into the formation and another goose flies to the point position. Lesson: It pays to take turns doing the hard tasks and sharing leadership. Like geese, people are interdependent on each other’s skills, capabilities, and unique arrangement of gifts, talents, or resources.

Fact 4: The geese flying in formation honk to encourage those up front to keep up their speed. Lesson: We need to make sure our honking is encouraging. In groups where there is encourage- ment, the production is much greater. The power of encouragement (to stand by one’s heart or core values and encourage the heart and core values of others) is the quality of honking we seek.

Fact 5: When a goose gets sick, wounded, or shot down, two geese drop out of the formation and follow it down to help and protect it. They stay until it dies or is able to fly again. Then they launch out with another formation or catch up with the flock. Lesson: If we have as much sense as a goose, we will stand by each other in difficult times as well as when we are strong.

Source: 1991 Organizational Development Network. Original author unknown.

CHAPTER 10 LEADING TEAMS 293

Types of Teams Teams are found at every level of today’s organizations. At Cirque du Soleil, the CEO, chief operating officer, chief financial officer, and vice president of creation function as a top management team to develop, coordinate, and oversee acrobatic troupes that travel to approximately 100 cities on four continents a year. Google assembles teams of three or four employees to assess new ideas and recommend whether they should be implemented. IBM uses teams formed of people specializing in hardware, software, research, and sales to solve specific problems for clients such as Walmart, Charles Schwab, and the Mayo Clinic.7 And at Tasty Catering, a family owned business in Chicago, teams of front-line employees from across the company— chefs and accountants, clerical workers and drivers, supervisors and servers—make all strategic decisions.8

Organizations use various types of teams to meet internal needs or external chal- lenges. Exhibit 10.1 illustrates three types of teams used in organizations: functional, cross-departmental, and self-directed.

Functional Teams A functional team is part of the traditional vertical hierarchy. This type of team is made up of a supervisor and his or her subordinates in the formal chain of command. Sometimes called a vertical team or a command team, the func- tional team can include three or four levels of hierarchy within a department. Typi- cally, a functional team makes up a single department in the organization. For example, the quality control department at Blue Bell Creameries in Brenham, Texas, is a functional team that tests all incoming ingredients to make sure only the best products go into the company’s ice cream. A financial analysis department, a human resources department, and a sales department are all functional or vertical teams. Each is created by the organization within the vertical hierarchy to attain specific goals through members’ joint activities.

Cross-Departmental Teams A cross-departmental term is made up of members from different departments within the organization. These teams are often called cross-functional teams. Cross-departmental teams are typically used for projects

EXHIBIT 10.1 Evolution of Teams and Team Leadership

Functional team a team made up of a su- pervisor and subordinates in the formal chain of command

Cross-departmental team team made up of members from different functional departments within an organization

294 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

that affect several departments and therefore require that many views be consid- ered. Cross-departmental teams facilitate information sharing across functional boundaries, generate suggestions for coordinating the departments represented, develop new ideas and solutions for existing organizational problems, and assist in developing new practices or policies.

One type of cross-departmental team is the special-purpose team, sometimes called a project team. Special-purpose teams focus on a specific purpose and disband once the project is completed. They are created outside the formal organization struc- ture to undertake a project of special importance or complexity or to develop a new product or service. The team working on a new search engine at Facebook, described earlier, is a special-purpose team. Leaders at Ford Motor Company created a special- purpose team to solve a problem related to the supply chain.

IN THE LEAD Tony Brown and Alan Mulally, Ford Motor Company The Big Three U.S. automakers (General Motors (GM), Chrysler, and Ford) weren’t the only organi- zations in the auto industry on the brink of bankruptcy by the fall of 2008. Most of their suppliers were also struggling to stay alive, and some had already gone out of business. Leaders at Ford knew that without parts, nothing else they did to save the company would matter.

Tony Brown, Ford’s vice president of global purchasing, suggested creating a special- purpose team to monitor parts manufacturers, prevent supply chain disruptions, and speed up Ford’s plan to narrow its base of suppliers. CEO Alan Mulally quickly agreed, and Project Quark (named after the family dog in the movie “Honey, I Shrunk the Kids”) came into being. The team included people from all of Ford’s divisions and functional departments—manufacturing, human resources, engineering, finance, information technology, legal, and others.

Time was of the essence, so the team started out in high gear—meeting every day, sometimes gathering before 7:00 A.M. and working late into the night, and providing regular reports to the CEO every Thursday. The team’s meeting room walls were covered with print- outs listing each supplier, the specific parts it provided, its financial condition, the plants it supported, and its other customers. A risk profile was created for each supplier, and the team narrowed the list down to 850 critical suppliers that Ford wanted to keep. Making sure these companies survived was Project Quark’s top priority.

The team and Ford executives knew Ford couldn’t save the global supply base on its own, so they began reaching out to other automakers. GM wasn’t interested, perhaps because its managers had even bigger problems to worry about, but Toyota and Honda quickly jumped on board, realizing that the web of interconnected suppliers was in danger of collapsing. In some cases, the three companies agreed to share the costs of keeping a particular supplier in business.9

This special-purpose team played a critical role in helping Ford prevent a sup- ply breakdown—and ultimately in helping leaders revive the company.

Evolution to Self-Directed Teams Cross-departmental teams may gradually evolve into self-directed teams. Self-directed teams, such as those at Morning Star, described in the chapter opening example, are made up of employees who work with minimum supervision and rotate jobs to produce an entire product or service, or at least one complete aspect or portion of a product or service.10

NEW LEADER ACTION MEMO As a leader, you can create a cross-departmental team to handle a project that requires coordination across functional boundaries. Use a special- purpose team for a project of special importance, such as developing a new product or service.

CHAPTER 10 LEADING TEAMS 295

Special-purpose team team that focuses on a specific purpose of high importance and disbands once the project is com- pleted; sometimes called a project team

Self-directed teams teams made up of members who work with minimum supervision and rotate jobs to produce a complete product or service

Exhibit 10.1 illustrates the evolution of teams and team leadership. The functional team groups individuals by common skill and activity within the traditional structure. Leadership is based on the vertical hierarchy. In cross-departmental teams, members have more freedom from the hierarchy, but the team typically is still leader-centered and leader-directed. The leader is most often assigned by the organization and is usu- ally a supervisor or manager from one of the departments represented on the team.

In the next stage of evolution, team members work together without the ongo- ing direction of managers, supervisors, or assigned team leaders. Empirical studies have shown that self-directed teams are associated with higher job satisfaction.11

Job satisfaction increases partly because working in self-directed teams enables peo- ple to feel challenged, find their work meaningful, feel more control over their work lives, and develop a stronger sense of identity with the organization.12

Self-directed teams have access to information and resources needed to per- form a complete task and are empowered with decision-making authority to take over duties such as selecting new members, scheduling work or vacations, and evaluating performance. Self-directed teams are typically not completely autono- mous, in that organizational leaders set overall direction and monitor the team’s work on a regular basis. However, these teams are effectively trained to work with minimum supervision, and members are jointly responsible for making decisions and solving problems. At Lockheed Martin’s Missiles and Fire Control division’s Pike County Operations in Troy, Alabama, all employees work in self- directed teams that set performance goals and make decisions related to assembling and testing advanced missile systems. Self-directed teams at Pike County Opera- tions have contributed to 100 percent on-time delivery with zero customer rejects for the division.13

Self-directed teams typically elect one of their own to serve as team leader, and the leader may change each year. Some teams function without a designated leader, so any- one may play a leadership role depending on the situation. For example, the emergency trauma team at Massachusetts General Hospital performs so smoothly that the team switches leaders seamlessly, depending on the crisis at hand. With each new emergency, direction may come from a doctor, intern, nurse, or technician—whoever is particularly experienced with the problem at hand.14

THE DILEMMA FOR TEAM MEMBERS When leaders at ICU Medical Products announced that the company was shifting to a structure based entirely on teams, the CFO quit.15 Some people love the idea of teamwork, others hate it, and many people have both positive and negative emo- tions about working as part of a team. Leaders can be more effective when they understand three primary reasons teams present a dilemma for people:

• We Have to Give Up Our Independence. When people become part of a team, their success depends on the team’s success; therefore, they are dependent on how well other people perform, not just on their own individual initiative and actions. In addition, whereas most people are comfortable with the idea of making sacrifices in order to achieve their own individual success, teamwork demands that they make sacrifices for group success.16 The idea is that each person should put the team first, even if at times it hurts the individual.

• We Have to Put Up with Free Riders. Teams are sometimes made up of people who have different work ethics. The term free rider refers to a team member

NEW LEADER ACTION MEMO As a leader, you can use a self- directed team when members are capable of working together without active supervision. Give the team access to the money, equipment, supplies, and in- formation needed to perform its project or task, and empower the team with decision-making authority.

NEW LEADER ACTION MEMO Do you enjoy working as part of a team, or do you prefer to do your work individually? Com- plete Leader’s Self-Insight 10.1 to get an idea of your feelings toward teamwork and whether team leadership might present a problem for you.

296 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Free rider a team member who attains benefits from team mem- bership but does not actively participate in and contribute to the team’s work

who attains benefits from team membership but does not actively participate in and contribute to the team’s work. You might have experienced this frustration in a student project team, where one member put little effort into the project but benefited from the hard work of others when grades were handed out. Free riding is sometimes called social loafing because some members do not exert equal effort.17 The potential for free riding might be one reason a survey found that 40 to 60 percent of people (depending on gender and age) like working in teams to learn from others, but no more than 36 percent report they like working in teams to complete tasks.18

• Teams Are Sometimes Dysfunctional. Some companies have had great success with teams, but there are also numerous examples of how teams in organiza- tions fail spectacularly.19 A civilian worker at a large U.S. Air Force base tells of an experience in which the team “streamlined” the process of handling mail by changing it from 8 steps to a ridiculous 19, meaning official mail was handled by more people and getting to its intended recipient even later than before.20 Exhibit 10.2 lists five dysfunctions that are common in teams.21

Over the past few decades, a great deal of research and team experience has produced significant insights into what causes teams to succeed or fail. The evidence shows that how teams are managed plays the most critical role.22

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 10.1

Individual or Team?

Instructions: Respond to the statements below with your preferences for working on your job or school assignments. Please answer whether each item below is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I prefer to work on a team rather than do tasks individually.

2. Given a choice, I try to work by myself rather than face the hassles of group work.

3. I enjoy the personal interaction when working with others.

4. I prefer to do my own work and let others do theirs.

5. I get more satisfaction from a group victory than an individual victory.

6. Teamwork is not worthwhile when people do not do their share.

7. I feel good when I work with others even when we disagree.

8. I prefer to rely on myself rather than others to do a job or assignment.

9. I find that working as a member of a team increases my ability to perform well.

10. It annoys me to do work as a member of a team.

Scoring and Interpretation For odd-numbered items give yourself 1 point for each Mostly True answer and for even-numbered items give your- self 1 point for each Mostly False answer.

Total Score .

Your score indicates your preference for working as part of a team versus working as an individual. A score of 8–10 sug- gests a clear preference for working with others on a team. Teams can accomplish tasks far beyond what an individual can do, and working with others can be a major source of satisfaction. A score of 0–3 suggests a clear preference for working alone rather than on a team. On a team you will lose some autonomy and have to rely on others who may be less committed than you. On a team you have to work through other people and you lose some control over work procedures and outcomes. A score of 4–7 suggests you are satisfied either working on a team or alone. How do you think your preference will affect your career choices and your potential role as a leader?

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LEADING A TEAM TO HIGH PERFORMANCE Smoothly functioning teams don’t just happen. They are created and shaped by leaders. Harvard Business School professors studying surgery teams, for example, found that the attitude and actions of the team leader, and the quality of the leader’s interactions with team members, are crucial to team effectiveness and the success of the surgery.23

Teamwork is becoming common in health care, but poor coordination and communi- cation among team members has been a real problem, leading to errors and even patient deaths. The U.S. Department of Defense and the Agency for Healthcare Research and Quality developed a team training program to teach cognitive and inter- personal skills that contribute to better health care teamwork, with significant focus on team leadership. Boston Children’s Hospital reduced medical errors by 40 percent after teams began applying the tools learned from the program.24

To lead any team to high performance, whether in health care, manufacturing, Internet services, or NASCAR racing, leaders incorporate the following elements:25

1. A Compelling Purpose, Clear Objectives, and Explicit Metrics. To succeed, team members have to know what is expected of them and commit to accom- plishing it. High-performing teams have a specific, clearly-defined purpose and a well-defined set of goals, enabling people to come together in a shared under- taking. A team cannot succeed if people are floundering around wondering why the team exists, or if people are going in different directions rather than pulling together for a common purpose. Team members also need clear metrics so they know how well they are progressing toward meeting goals.

2. A Diversity of Skills and Unambiguous Roles. Effective teams contain the diverse mix of skills, knowledge, and experience needed to perform all the com- ponents of the team’s project.26 In addition, diversity in terms of race, gender, ethnic or cultural background, and other dimensions can contribute to greater innovation and better decision making because the team can draw from wider perspectives.27 Within this diverse mix, however, individual roles and responsi- bilities are clearly defined. Clear roles and expectations for members lead to enhanced cooperation because people aren’t butting up against one another in confusion over their duties and responsibilities.28

EXHIBIT 10.2 Five Common Dysfunctions of Teams

Dysfunction Attitudes and behaviors

Lack of trust People don’t feel safe to reveal mistakes, share concerns, or express ideas

Fear of conflict People go along with others for the sake of harmony; don’t express conflicting opinions

Lack of commitment People can’t truly commit to decisions because they haven’t contributed their true opinions and ideas

Avoidance of accountability

People don’t accept responsibility for outcomes; engage in finger- pointing when things go wrong

Inattention to results Members put personal ambition or the needs of their individual departments ahead of collective results

Source: Based on Patrick Lencioni, The Five Dysfunctions of a Team (New York: John Wiley & Sons, 2002).

High- performance

teams and orga- nizations do not arise spontane-

ously. They do not appear overnight. High performance is a process and a

mind-set. It re- quires a method- ology and it must

be practiced— over and over.

John Foley, founder and president

of John Foley, Inc.; former Marine Corps jet

fighter instructor pilot and lead solo pilot

of the Blue Angels jet acrobatics team

298 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

3. Streamlined Team Size. Although most researchers agree there is no optimal team size, teams function best when they contain just enough members to per- form the job, and most experts recommend that teams should err on the side of having too few members rather than too many.29 Much research has shown that small teams (six or fewer members) perform better than large ones.30

Members on small teams typically ask more questions, exchange more opi- nions, and exhibit more cooperative behavior. In addition, people in small teams report higher motivation, more job satisfaction, and a greater sense of belonging and cohesiveness. A Gallup poll in the United States found that 82 percent of employees agree that small teams are more productive.31

4. Decision Authority Over How to Achieve Goals. Although teams need clearly defined goals spelled out by leaders, the team itself should have the authority to decide how it will reach those goals. Good leaders share power, information, and responsibility and work to build consensus rather than issuing orders.32

Members of high-performing teams determine together how they will work cooperatively to accomplish objectives and achieve the team’s purpose.

5. Support and Coaching. Although team leaders have to keep people focused on accomplishing tasks, research shows that the soft leadership skills concerned with building positive relationships are especially important for creating a high-performance team.33 Team effectiveness, productivity, and learning are strengthened when team leaders provide support to team members, reinforce team identity and meaning, work to maintain trusting interpersonal relation- ships and group cohesiveness, and offer coaching to enhance members’ self- leadership skills. Periodic training that teaches skills such as communication, building relationships, developing productive norms, and resolving conflicts can have a significant impact on team collaboration and performance.

These five elements are among the most important guidelines for team leaders. The Leader’s Bookshelf further discusses characteristics of teams that lead to high performance.

TEAM PROCESSES Team processes refer to the dynamics that change over time and can be influenced by leaders. In this section we discuss stages of development, cohesiveness, and norms. The fourth type of team process, conflict, will be covered later in the chapter.

How Teams Develop It is important for leaders to understand that teams develop over time.34 Research sug- gests that teams develop over several stages. Exhibit 10.3 shows one model of the stages of team development.35 These stages typically occur in sequence, although there can be overlap.

Forming The forming stage of development is a period of orientation and getting acquainted. Team members find out what behavior is acceptable to others, explore friendship possibilities, and determine task orientation. Uncertainty is high because no one knows what the ground rules are or what is expected of them. Members will usu- ally accept whatever power or authority is offered by either formal or informal leaders. The leader’s challenge at this stage of development is to facilitate communication and

NEW LEADER ACTION MEMO As a leader, you can articulate a clear and compelling vision for the team to help members see their work as meaningful and important. You can define objectives and clarify roles but give people decision-making authority over how to achieve goals. Make room for everyone to contribute and provide peo- ple with the training, support, and coaching they need to excel.

Assess your team leadership skills by logging in to CengageNOW to complete the interactive questionnaire.

Forming stage of team development that includes orientation and getting acquainted

CHAPTER 10 LEADING TEAMS 299

interaction among team members to help them get acquainted and establish guidelines for how the team will work together. It is important at this stage for the leader to make everyone feel comfortable and like a part of the team. Leaders can draw out shy or quiet team members to help them establish relationships with others.

Storming During the storming stage, individual personalities emerge more clearly. People become more assertive in clarifying their roles. This stage is marked by conflict and disagreement. Team members may disagree over their perceptions of the team’s mission or goals. The team is characterized by a general lack of unity and cohesive- ness. It is essential that teams move beyond this stage or they will never achieve high performance. A recent experiment with student teams confirms the idea that teams that get stuck in the storming stage perform significantly less well than teams that progress to future stages of development.36 The leader’s role during the storming stage is to encourage participation by each team member and help people find their common vision and values. Members need to debate ideas, surface conflicts, disagree with one another, and work through the uncertainties and conflicting perceptions about team tasks and goals. The expression of emotions, even negative ones, helps to build camaraderie and a shared understanding of goals and tasks.37

Norming At the norming stage, conflict has been resolved and team unity and har- mony emerge. Consensus develops as to who the natural team leaders are, and members’ roles are clear. Team members come to understand and accept one another. Differences are resolved, and members develop a sense of cohesiveness.

LEADER’S BOOKSHELF Great Business Teams: Cracking the Code for Standout Performance

by Howard M. Guttman

Management consultant and author Howard Guttman believes high- performance organizations begin with great teams. In his book, Great Business Teams, Guttman draws on research into the inner workings of several dozen high-performance teams at companies such as Johnson & Johnson, L’Oreal, Novartis, and Mars Drinks.

CHARACTERISTICS OF GREAT TEAMS Whether it is a top leadership team, a cross-departmental project team, or a self-directed product development team, Guttman says great teams share five key characteristics:

• They Are Led by High-Performance Leaders. Leaders of great teams put power and authority in the hands of the team. They see their job as making sure all members are clear about and committed to the business strategy and operational goals, understand

their roles and responsibilities, and adhere to specific ground rules for decision making and interpersonal behavior.

• They Have Members Who Act as Leaders. Members of great teams act as leaders by embracing responsibility, exerting influence to accomplish tasks, and holding one another accountable for results. Everyone’s performance— even the leader’s—is subject to scru- tiny and feedback.

• They Abide by Protocols. Ambigu- ity kills effective teamwork, says Guttman. To achieve high perfor- mance, everyone on the team needs to be clear about what the team as a whole is going to accomplish, what each individual will contribute, how the team will carry out its tasks, and how members are expected to inter- act with one another.

• They are Never Satisfied. On a high- performance team, self-monitoring, self-evaluation, and continually raising the performance bar are the norm.

• They Have a Supportive Perfor- mance Management System. To get great teamwork, the organization’s performance management and reward systems have to support the expected team behaviors.

WHY TEAMS? Guttman believes today’s organizations and the challenges they face are too complex for formal leaders to make all the decisions. He argues that companies can best succeed with distributed leader- ship, in which key decisions are made by layers of self-directed teams that are jointly accountable for performance.

Source: Great Business Teams, by Howard Gutt- man, is published by John Wiley & Sons.

hu tte rs to ck .c om

NEW LEADER ACTION MEMO As a leader, you can guide your team through its stages of de- velopment. Early on you can help members know one an- other, and then encourage participation and common purpose, followed by clarifying goals and expectations. Finally, you can concentrate on helping the team achieve high performance.

Storming stage of team development in which individual person- alities and conflicts emerge

Norming stage of team development in which conflicts have been resolved and team unity emerges

300 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

This stage typically is of short duration and moves quickly into the next stage. The team leader should emphasize openness within the team and continue to facilitate communication and clarify team roles, values, and expectations.

Performing During the performing stage, the major emphasis is on accomplishing the team’s goals. Members are committed to the team’s mission. They interact fre- quently, coordinate their actions, and handle disagreements in a mature, productive manner. Team members confront and resolve problems in the interest of task accomplishment. At this stage, the team leader should concentrate on facilitating high task performance and helping the team self-manage to reach its goals.

Adjourning The adjourning stage occurs in committees and teams that have a lim- ited task to perform and are disbanded afterward. During this stage, the emphasis is on wrapping up and gearing down. Task performance is no longer a top priority, and leaders frequently focus on team members’ social and emotional needs. People may feel heightened emotionality, strong cohesiveness, and depression or regret over the team’s disbandment. At this point, the leader may wish to signify the

EXHIBIT 10.3 Five Stages of Team Development

Sources: Based on the stages of small group development in Bruce W. Tuckman, “Developmental Sequence in Small Groups,” Psychological Bulletin 63 (1965), pp. 384–399; and B.W. Tuckman and M.A. Jensen, “Stages of Small Group Development Revisited,” Group and Organizational Studies 2 (1977), pp. 419–427.

CHAPTER 10 LEADING TEAMS 301

Performing stage of team development in which the major emphasis is on accomplishing the team’s goals

Adjourning stage of team development that occurs in committees and teams that have a lim- ited task to perform; the emphasis is on wrapping up, gearing down, and signifying closure

team’s disbanding with a ritual or ceremony, perhaps giving out certificates or awards to signify closure and completeness.

When teams are under time pressure, these stages might occur quite rapidly and even overlap. Stages may also be accelerated for virtual teams. For example, at a large consumer goods company with a virtual team of engineers working in the United States and India, leaders started the project with a couple of days of team building to help the team move rapidly through the forming and storming stages.

IN THE LEAD Spring Company When top leaders at Spring Company decided to move some aspects of supply chain process development to one of the company’s Indian facilities, one of their key concerns was making sure the engineers in the United States and the ones in India came together quickly around a shared mission and a focus on key performance goals, putting the success of the team ahead of individual interests.

To take the team to the performing stage as quickly as possible, leaders and consul- tants held a series of team-building activities during which team members together created a shared vision, developed specific team norms and agreements, built virtual relationships, and clarified roles and responsibilities. Cultural education and exercises on virtual communi- cation were also part of the process. By the end of the team-building activities, members were laughing together and eager to get on with their work. A follow-up by webinar and phone found that the team was on track toward meeting its goals; moreover, everyone was still having a good time working together.38

The team building process at Spring Company not only helped people reach the performing stage quickly, it also contributed to building cohesiveness, which is gen- erally considered an attractive feature of teams.

Team Cohesiveness Team cohesiveness is defined as the extent to which members are attracted to the team and motivated to remain in it.39 Members of highly cohesive teams are com- mitted to team activities, attend meetings, and are happy when the team succeeds. Members of less cohesive teams are less concerned about the team’s welfare. Lea- ders typically want to encourage high cohesiveness in teams.

Determinants of Cohesiveness Leaders can use several characteristics of team struc- ture and context to influence cohesiveness. First is team interaction. When team members have frequent contact, they get to know one another, consider themselves a unit, and become more committed to the team.40 Second is the concept of shared goals. When team members agree on purpose and direction, they will be more cohe- sive. The most cohesive teams are those that feel they are involved in something immensely relevant and important. An aerospace executive, recalling his participa- tion in an advanced design team, put it this way, “We even walked differently than anybody else. We felt we were way out there, ahead of the whole world.”41 Third is personal attraction to the team, meaning that members have similar attitudes and values and enjoy being together.

NEW LEADER ACTION MEMO As a leader, you can facilitate team cohesiveness by providing members with opportunities to interact and know one another. You can use friendly competi- tion with other teams to in- crease cohesiveness, and work with top leaders to develop high-performance norms for the team.

302 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

team cohesiveness the extent to which mem- bers are attracted to the team and motivated to remain in it

Two factors in the team’s context also influence group cohesiveness. The first is the presence of competition. When a team is in moderate competition with other teams, its cohesiveness increases as it strives to win. Finally, team success and the favorable evaluation of the team by outsiders add to cohesiveness. When a team succeeds in its task and others in the organization recognize the success, members feel good, and their commitment to the team will be high.

Consequences of Cohesiveness The outcome of team cohesiveness can fall into two categories—morale and performance. As a general rule, morale is higher in cohesive teams because of increased communication among members, a friendly team cli- mate, maintenance of membership because of commitment to the team, loyalty, and member participation in team decisions and activities. High cohesiveness has almost uniformly good effects on the satisfaction and morale of team members.42

With respect to performance, studies suggest that teams in which members share strong feelings of connectedness and generally positive interactions tend to perform better.43 Thus, a friendly, positive team environment contributes to pro- ductivity as well as member satisfaction. Cohesive teams can sometimes unleash enormous amounts of employee energy and creativity. One explanation for this is the research finding that correlates in-person interactions among employees with higher productivity. Among call center teams at Bank of America, for example, pro- ductivity rose 10 percent when leaders scheduled more face-to-face interaction time. Simply interacting with others has an energizing effect.44

However, cohesiveness can also decrease performance in some cases. One mat- ter of particular concern is groupthink, which refers to the tendency of people in cohesive groups to suppress contrary opinions. The hesitation of team members to express safety concerns that went against the group consensus has been cited as a contributing factor to the 1986 Challenger space shuttle disaster. People slip into groupthink when the desire for harmony outweighs concerns over decision qual- ity.45 Other research suggests that performance in cohesive teams may depend on the relationship between leaders and the work team. One study surveyed more than 200 work teams and correlated job performance with their cohesiveness.46

Highly cohesive teams were more productive when team members felt top leader support and less productive when they sensed leader hostility and negativism.

Team Norms A team norm is an informal standard of conduct that is shared by team members and guides their behavior.47 Norms are valuable because they provide a frame of reference for what is expected and acceptable.

Exhibit 10.4 illustrates two common ways in which norms develop.48 Norms begin to develop in the first interactions among members of a new team, so first behaviors often set a precedent for how the team will interact. At one company, a team leader began his first meeting by raising an issue and then “leading” team members until he got the solution he wanted. The pattern became ingrained so quickly into an unproduc- tive team norm that members dubbed meetings the “Guess What I Think” game.49

Team leaders should use care to shape norms that will help the team be effec- tive. For example, research shows that when leaders have high expectations for col- laborative problem-solving, teams develop strong collaborative norms.50 One powerful way in which leaders influence norms is by making explicit statements about the desired team behaviors. When he was CEO of Ameritech, Bill Weiss established a norm of cooperation and mutual support among his top leadership

CHAPTER 10 LEADING TEAMS 303

Groupthink the tendency of people in cohesive groups to suppress contrary opinions

Team norm an informal standard of conduct that is shared by team members and guides their behavior

team by telling them bluntly that if he caught anyone trying to undermine the others, the guilty party would be fired.51

WHAT TEAM MEMBERS MUST CONTRIBUTE Now lets turn our attention to understanding the qualities and competencies of team members that contribute to high performance. To understand the need for a variety of skills and competencies, consider the 33 miners who were trapped for months underground after a copper mine collapsed in San José, Chile, in August 2010. The miners organized into several teams in charge of critical activities such as communication with rescue workers, the transport of supplies from above ground, rationing and distribution of food, managing health concerns, and securing the mine to prevent further rock falls. Some team members were clearly focused on helping the trapped miners meet their needs for physical survival, some focused on helping people coordinate their activities, and still others focused on the group’s psychological and social needs, helping people maintain hope and a sense of soli- darity as the ordeal stretched to a harrowing 69 days. Experts agree that teamwork and leadership were key to the miners’ survival.52

Essential Team Competencies Research has identified a number of key competencies needed to make up an effec- tive team.53 To function well as a team, members of the team should together dis- play each of the following five competencies:

1. Goal Setting and Performance Management. First and foremost, team members must have the ability to establish and execute specific, challenging team objectives, as well as ways to monitor and evaluate performance toward meeting objectives.

2. Planning and Coordination. The ability to plan and coordinate is an important determinant of team effectiveness.54 Members must tightly cooordinate and syn- chronize activities, information, and resources in order to accomplish goals.

EXHIBIT 10.4 Two Ways Team Norms Develop

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NEW LEADER ACTION MEMO What contributions do you make to a team? Complete the ques- tionnaire in Leader’s Self-Insight 10.2 to see which competencies you typically contribute to the success of a team.

304 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

3. Collaborative Problem Solving. Team members need to be able to recognize when a problem requires group participation and then appropriately involve team members in searching for alternatives and devising solutions.

4. Communication. Employees working on individual jobs can sometimes get by with poor communication skills, but the wheels of teamwork keep rolling only with good communication. Members speak their minds, ask questions, seek and provide feedback, and make skillful presentations.

5. Conflict Resolution. Last, but by no means least, teams need to know how to effectively manage and resolve disagreements. Even in the most cohesive of teams, conflicts will inevitably arise.

Team Member Roles The five team competencies reflect that a team needs members who meet the impor- tant needs of the team for both accomplishing its tasks and fostering member unity, satisfaction, and well-being. Recall from Chapter 3 the discussion of situational leadership and the meta-categories of task-oriented and relationship-oriented beha- viors described in that chapter (Exhibit 3.2). Task-oriented behavior places primary

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 10.2

Are You a Contributing Team Member?

Instructions: Think about how you have typically behaved and contributed as a member of student or work teams. Respond to the statements below based on how you typi- cally behaved on those teams.

Mostly False

Mostly True

1. I proposed a clear vision of team purpose.

2. I initiated up-front discussions of team goals and objectives.

3. I suggested corrective actions to improve performance.

4. I helped coordinate team members.

5. I came to meetings well prepared. 6. I followed through on promises

and commitments. 7. I was a focused, active listener. 8. I proactively engaged others in

problem solving. 9. I gave team members apprecia-

tion and support. 10. I praised people for a job well

done.

Scoring and Interpretation These questions pertain to your contributions as a team member as described in the chapter. These items concern

various important ways for a team member to contribute to the success of a team. By comparing your scores on the following scales, you may be able to identify the ways you most contribute to a team. To calculate your scores, give yourself 1 point for each Mostly True answer for the items indicated.

A. Goal Setting: Items 1, 2: B. Performance Management: Items 3, 4: C. Preparation: Items 5, 6: D. Communication for Problem Solving: Items 7, 8: E. Social Support: Items 9, 10:

An effective team must have members who contribute individually. A team must have someone performing each part, but no member is expected to perform all parts. Indeed, if you scored Mostly True on all the questions, you would be playing a leader role on the team. Part A pertains to goal and direction setting, which is often a team leader role. Part B concerns performance management, which is often part of a team leader’s role, but team members also contribute in this way. Part C is about your ability to be interdependent with other team members. Part D pertains to communication and problem solving skills. Part F is about meeting the relationship needs of team members, which is also a team leader role. How do you feel about your contribution to teams? In what ways do you take the initiative to be an effective member? What might you do to be more effective?

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305 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

concern on tasks and production and is generally associated with higher productiv- ity, whereas relationship-oriented behavior emphasizes concern for followers and relationships and is associated with higher employee satisfaction.

For a team to be successful over the long term, both task-oriented behavior and relationship-oriented behavior are required within the team. The task-specialist role is associated with behaviors that help the team accomplish its goal. People who play a task-specialist role often display the following behaviors:

• Initiate Ideas. Propose new solutions to team problems. • Give Opinions. Offer opinions on task solutions; give candid feedback on

others’ suggestions. • Seek Information. Ask for task-relevant facts. • Summarize. Relate various ideas to the problem at hand; pull ideas together

into a summary perspective. • Energize. Stimulate the team into action when interest drops.55

The socioemotional role includes behaviors that maintain people’s emotional well-being and strengthen the social identity. People who adopt a socioemotional role display the following behaviors:

• Encourage. Are warm and receptive to others’ ideas; praise and encourage others to draw forth their contributions.

• Harmonize. Reconcile group conflicts; help disagreeing parties reach agreement. • Reduce Tension. Tell jokes or in other ways draw off emotions when group

atmosphere is tense. • Follow. Go along with the team; agree to other team members’ ideas. • Compromise. Will shift own opinions to maintain team harmony.56

Teams with mostly socioemotional roles can be satisfying, but they also can be unproductive. At the other extreme, a team made up primarily of task specialists will tend to have a singular concern for task accomplishment. This team will be effec- tive for a short period of time but will not be satisfying for members over the long run. Effective teams have people in both task-specialist and socioemotional roles. A well-balanced team will do best over the long term because it will be personally satisfying for team members as well as permit the accomplishment of team tasks.

People tend to take on different roles based on their personalities and interests. Some people naturally lean more toward behaviors that aid in accomplishing tasks, whereas others tend toward behaviors that maintain group harmony and satisfaction. People who can excel at both types of roles often emerge as team leaders. At Marriott, strengthening both task-oriented and relationship-oriented skills is a primary goal for team leader training because teams headed by leaders with both types of skills are typi- cally more productive and innovative.57 In any case, it is the leader’s responsibility to make sure both task and socioemotional needs are met, whether through the leader’s own behaviors or through the actions and behaviors of other team members.

LEADING A VIRTUAL TEAM Being a team leader can be particularly challenging when people are scattered in different geographical locations and may be separated by language and cultural dif- ferences as well. Virtual teams are a reality for today’s leaders. A virtual team is made up of geographically or organizationally dispersed members who share a

NEW LEADER ACTION MEMO As a leader, you can make sure that both the task and socio- emotional needs of team members are met so that people experience both friendly support and goal accomplishment.

306 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Task-specialist role team role associated with initiating new ideas, evalu- ating the team’s effective- ness, seeking to clarify tasks and responsibilities, summa- rizing facts and ideas for others, and stimulating others to action

Socioemotional role team role associated with facilitating others’ participa- tion, smoothing conflicts, showing concern for team members’ needs and feel- ings, serving as a role model, and reminding others of standards for team interaction

Virtual team team made up of geo- graphically or organization- ally dispersed members who share a common purpose and are linked primarily through advanced informa- tion technologies

common purpose and are linked primarily through advanced information and tele- communications technologies.58 Virtual teams are sometimes also global teams. A global team is a cross-border work team made up of members of different national- ities whose activities span multiple countries.59

Exhibit 10.5 illustrates the primary differences between conventional types of teams and today’s virtual teams. Conventional types of teams discussed earlier in this chapter meet and conduct their interactions face-to-face in the same physical space. Team members typically share similar cultural backgrounds and characteris- tics. The key characteristics of virtual teams, on the other hand, are (1) spatial dis- tance limits face-to-face interaction and (2) the use of technological communication is the primary means of connecting team members.60 Members of virtual teams are often scattered in different locations, whether it be different offices and business locations around the country or around the world. Team members use e-mail, tele- phone, text messaging, videoconferencing, Skype, other Internet technologies, and various forms of collaboration software to perform their work rather than meeting face-to-face. Although some virtual teams are made up of only organizational mem- bers, virtual teams often include contingent workers, members of partner organiza- tions, customers, suppliers, consultants, or other outsiders. Consider the virtual teams at Smart Balance, the “heart-healthy” food company.

IN THE LEAD Smart Balance Smart Balance has about 67 employees, but nearly 400 people work for the company. Smart Balance started by making a buttery spread and now has a line of spreads; all-natural pea- nut butter; nutrient-enhanced milk, cheese, sour cream, and popcorn; and other products. Leaders decided to use virtual teams, including employees and outside contractors, to enable Smart Balance to innovate and expand rapidly.

Smart Balance keeps product development and marketing in-house but uses contractors to do just about everything else, including manufacturing, distribution, sales, information technol- ogy services, and research and testing. Each morning, virtual team members exchange a flurry of e-mails, text messages, and phone calls to update each other on what took place the day before and what needs to happen today. Leaders spend much of their time building and man- aging team relationships. Twice a year they hold all-company meetings that include full-time Smart Balance employees and employees of contractors participating in virtual teams. Informa- tion is exchanged widely, and leaders make a point of recognizing the contributions of virtual members to the company’s success, which helps create a sense of unity and commitment.61

EXHIBIT 10.5 Differences between Conventional, Virtual, and Global Teams

Type of Team Spatial Distance Communications

Member Cultures

Leader Challenge

Conventional Colocated Face-to-face Same High

Virtual Scattered Mediated Same Higher

Global Widely scattered Mediated Different Very high

Global team team made up of culturally diverse members who live and work in different coun- tries and coordinate some part of their activities on a global basis

CHAPTER 10 LEADING TEAMS 307

Uses of Virtual Teams According to recent surveys, nearly half of all organizations surveyed use virtual teams, and about 80 percent of employees at multinational corporations have been part of a virtual team at some time.62 Virtual teams may be temporary cross- departmental teams that work on specific projects, or they may be long-term, self- directed teams. One of the primary advantages of virtual teams is the ability to rap- idly assemble the most talented group of people to complete a complex project, solve a particular problem, or exploit a specific strategic opportunity. The diverse mix of people can fuel creativity and innovation. On a practical level, organizations can save employees time and cut travel expenses when people meet in virtual rather than physical space. IBM reported that it saved more than $50 million in travel- related expenses in one recent year by using virtual teams.63

Challenges of Virtual Teams Despite their potential benefits, there is growing evidence that virtual teams are often less effective than teams whose members meet face-to-face.64 Studies indicate that, as virtual distance grows, innovative behavior can decline by a whopping 93 percent. Trust drops 83 percent, clarity of roles and objectives falls 62 percent, and project results such as on-time delivery and customer satisfaction decline by about 50 percent.65 The team leader can make a tremendous difference in how well a virtual team performs, but virtual teams bring significant leadership challenges.66

Building team relationships and trust is the biggest challenge faced by virtual team leaders. “Being authentic, connecting with others … and all of the interper- sonal skills leaders use to build relationships and trust are always important,” one team leader said, but in a virtual environment, “the actions associated with these skills must be deliberate and intentional.”67 Virtual team leaders have to trust peo- ple to do their jobs without constant supervision, and they learn to focus more on results than on the process of accomplishing them. Too much control can kill a vir- tual team, so leaders have to give up most of their control and yet at the same time provide guidance, encouragement, support, and development. To be successful, vir- tual team leaders can master the following skills:68

• Select the Right Team Members. Effective virtual team leaders put a lot of thought into getting the right mix of people on the team. Team members need the right mix of technical, interpersonal, and communication skills to work effectively in a virtual environment. In addition, leaders make clear to the team why each member was chosen to participate, thus giving people a basis for trust in others’ abilities and com- mitment. Choosing people who have open, honest, and trusting personalities is also a plus. As with other types of teams, small virtual teams tend to be more cohesive and work together more effectively. However, diversity of views and experiences is also important to the success of a virtual team. Diversity is usually built into virtual teams because when leaders can pick the right people for the job, no matter where they are located, members usually reflect diverse backgrounds and viewpoints.69

• Start Off Right. Leaders make sure people have opportunities to know one another and establish trusting relationships. Studies of virtual teams suggest that an initial face-to-face meeting is one of the best ways to get people to come together as a team and rapidly go through the forming and storming stages of development, as discussed earlier in this chapter.70 At Mobil Corporation, leaders bring virtual team members together in one location at the beginning of a project so they can begin to build personal relationships and gain an understanding of

NEW LEADER ACTION MEMO As a leader, you can help a virtual team perform even with limited control and supervision. You can select members who thrive in a virtual environment, arrange opportunities for peri- odic face-to-face meetings, and ensure that members under- stand goals, responsibilities, and performance standards.

308 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

their goals and responsibilities. LivePerson Inc., a leading cloud-based platform company, builds in ways for people from around the world to come together face-to-face whenever there seems to be a need for it. “We understand there is a cost to this, but we see real results, so it is a price we willingly pay,” says senior vice president Steve Schloss.71

• Use Technology to Build Relationships. Leaders also apply technology to build relationships.72 Leaders hold team meetings using Skype, for example, to enable people to get to know one another and clarify roles and project tasks. They also encourage non-task-related communication, such as the use of online social net- working where people can share photos, thoughts, and personal biographies. “Managers often assume that people are mainly interested in what their fellow team members can do, not who they are,” Keith Ferrazi wrote in a Harvard Busi- ness Review blog. “Wrong!” Ferrazi and other virtual team experts emphasize the value of non-work-related interactions.73 Researchers have also found that round- the-clock virtual work spaces, where team members can access the latest versions of files, keep track of deadlines and timelines, monitor one another’s progress, and carry on discussions between formal meetings enhance virtual team success.74

• Agree on Ground Rules. Leaders make everyone’s roles, responsibilities, and authority clear from the beginning. All team members need to explicitly under- stand both team and individual goals, deadlines, and expectations for participa- tion and performance. When roles and expectations are clear, trust can develop more easily. It is also important that leaders define a clear context so that people can make decisions, monitor their own performance, and regulate their behavior to accomplish goals. For each virtual team decision, Kevan Hall, CEO of Global Integration, asks team members to summarize the decision, whether they agree with it, and the specific actions they will take as a result of the decision.75

Another important point is shaping norms of respectful interaction. Team mem- bers need to agree on communications etiquette, rules for “verbalizing” online when members are shifting mental gears or need more feedback, whether there are time limits on responding to voice mail or e-mail, and so forth.

As the use of virtual teams grows, there is growing understanding of what makes them successful. Some experts suggest that leaders solicit volunteers as much as possible for virtual teams, and interviews with virtual team members and leaders support the idea that members who truly want to work as a virtual team are more effective.76

HANDLING TEAM CONFLICT As one would expect, there is an increased potential for conflict among members of virtual teams because of the greater chances for miscommunication and misunder- standings. Studies of virtual teams indicate that how they handle internal conflicts is critical to their success, yet conflict within virtual teams tends to occur more fre- quently and take longer to resolve. Moreover, people in virtual teams who communi- cate by e-mail tend to engage in more inconsiderate behaviors such as name-calling or insults than do people who work face-to-face.77 Some people aren’t cut out for virtual teamwork and show a greater propensity for shirking their duties or giving less than their full effort when working in a virtual environment, which can lead to team conflicts.78 Cultural value differences, little face-to-face interaction, and lack of on-site monitoring make it harder to build team identity and commitment.

CHAPTER 10 LEADING TEAMS 309

Whenever people work together in teams, some conflict is inevitable. Whether leading a virtual team or a team whose members work side-by-side, bringing conflicts into the open and effectively resolving them is one of the team leader’s most important jobs. Conflict refers to antagonistic interaction in which one party attempts to block the intentions or goals of another.79 Effective conflict management has a positive impact on team cohesiveness and performance.80 High-performing teams typically have lower levels of conflict, and the conflict is more often associated with tasks than with inter- personal relationships. In addition, teams that reflect healthy patterns of conflict are usually characterized by high levels of trust and mutual respect.81

Types of Conflict Two basic types of conflict that occur in teams are task conflict and relationship conflict.82 Task conflict refers to disagreements among people about the goals to be achieved or the content of the tasks to be performed. Two shop foremen might dis- agree over whether to replace a machine’s valve or let it run despite the unusual noise it is making. Or two members of a top management team might disagree about whether to acquire a company or enter into a joint venture as a way to expand globally. Relationship conflict refers to personal incompatibility that creates tension and feelings of personal animosity among people. For example, a recurring problem for many hospitals that have implemented teams is conflict between doc- tors and nurses or other team members. Many physicians are accustomed to being in charge and calling all the shots, and the shift to teamwork has been difficult. A survey of hospital administrators performed for the American College of Physician Executives found that 71 percent reported that disruptive behavior, such as doctors berating nurses for “interrupting” them with questions, surgeons flinging scalpels, or physicians demeaning coworkers they consider incompetent, occurs at least monthly at their hospital.83

In general, research suggests that task conflict can be beneficial because it leads to better decision making and problem solving. On the other hand, relationship conflict is typically associated with negative consequences for team effectiveness.84 One study of top management teams, for example, found that task conflict was associated with higher decision quality, greater commitment, and more decision acceptance, while the presence of relationship conflict significantly reduced those same outcomes.85

Balancing Conflict and Cooperation There is evidence that mild conflict can be beneficial to teams.86 A healthy level of conflict helps to prevent groupthink, as described earlier, in which people are so committed to a cohesive team that they are reluctant to express contrary opinions. When people in work teams go along simply for the sake of harmony, problems typically result. Thus, a degree of conflict leads to better decision making because multiple viewpoints are expressed.

However, conflict that is too strong, that is focused on personal rather than work issues, or that is not managed appropriately can damage productivity, tear rela- tionships apart, and interfere with the healthy exchange of ideas and information.87

Team leaders have to find the right balance between conflict and cooperation, as illustrated in Exhibit 10.6. Too little conflict can decrease team performance because the team doesn’t benefit from a mix of opinions and ideas—even disagreements—that might lead to better solutions or prevent the team from making mistakes. At the other end of the spectrum, too much conflict outweighs the team’s cooperative efforts and leads to a decrease in employee satisfaction and commitment, hurting team

310 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Conflict antagonistic interaction in which one party attempts to thwart the intentions or goals of another

Task conflict disagreement among peo- ple about the goals to be achieved or the content of the tasks to be performed

Relationship conflict personal incompatibility that creates tension and feelings of personal animosity among people

performance. A moderate amount of conflict that is managed appropriately typically results in the highest levels of team performance.

Causes of Conflict Several factors can lead to conflict.88 One of the primary causes of conflict is com- petition over resources, such as money, information, or supplies. In similar fashion, conflict often occurs simply because people are using those resources to pursue dif- fering goals. Goal differences are natural in organizations. For example, the sales department’s goals for fast delivery on new orders might conflict with the manufacturing department’s goals for high quality and efficiency.

The lack of clear roles and responsibilities can also lead to conflict. Consider the 2012 multibillion-dollar loss at JPMorgan Chase. Many people wondered how implementation of the company’s careful low-risk trading strategy faltered so badly. Ina Drew, the senior banker who has been partly blamed for the problems, had won the complete trust of CEO Jamie Dimon after she steered the company through the 2008 financial crisis. However, Drew was out of the office a great deal of time due to illness beginning in 2010, and long-simmering conflicts and divi- sions over roles and responsibilities emerged. Drew’s deputy in New York, Althea Duersten, disagreed with the risky, outsized bets being made by Achilles Macris, the deputy in London, but the London deputy used his stronger personality to shout down Duersten’s objections. One trader underscored the lack of clear roles when he said he “didn’t know who to listen to.”89

Styles to Handle Conflict Teams as well as individuals develop specific styles for dealing with conflict, based on the desire to satisfy their own concern versus the other party’s concern. A model

EXHIBIT 10.6 Balance Conflict with Cooperation

CHAPTER 10 LEADING TEAMS 311

that describes five styles of handling conflict is in Exhibit 10.7. The two major dimensions are the extent to which an individual is assertive versus unassertive and cooperative versus uncooperative in his or her approach to conflict.90

1. The dominating style (my way) reflects assertiveness to get one’s own way and should be used when quick, decisive action is vital on important issues or unpopular actions, such as during emergencies or urgent cost cutting.

2. The avoiding style (no way) reflects neither assertiveness nor cooperativeness. It is appropriate when an issue is trivial, when there is no chance of winning, when a delay to gather more information is needed, or when a disruption would be costly.

3. The compromising style (half way) reflects a moderate amount of both asser- tiveness and cooperativeness. It is appropriate when the goals on both sides are equally important, when opponents have equal power and both sides want to split the difference, or when people need to arrive at temporary or expedient solutions under time pressure.

4. The accommodating style (your way) reflects a high degree of cooperative- ness, which works best when people realize that they are wrong, when an issue is more important to others than to oneself, when building social cred- its for use in later discussions, and when maintaining harmony is especially important.

EXHIBIT 10.7 A Model of Styles to Handle Conflict

Sources: Based on Kenneth Thomas, “Conflict and Conflict Management,“ in Handbook of Industrial and Organizational Behavior, ed. M.D. Dunnette (New York: John Wiley, 1976), p 900; and Nan Peck, “Conflict 101: Styles of Fighting,” North Virginia Community College Website, September 20, 2005, www.nvcc.edu/home/npeck/conflicthome/conflict/Conflict101/conflictstyles.htm (accessed April 13, 2011)

NEW LEADER ACTION MEMO Which conflict-handling style do you tend to use most fre- quently? Answer the questions in Leader’s Self-Insight 10.3 to find out. Try to think of conflict situations you’ve been involved in where each of the styles might be appropriate.

312 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

5. The collaborating style (our way) reflects both a high degree of assertiveness and cooperativeness. The collaborating style enables both parties to win, although it may require substantial bargaining and negotiation. The collaborating style is important when both sets of concerns are too important to be compromised, when insights from different people need to be merged into an overall solution, and when the commitment of both sides is needed for a consensus.

An example of the collaborating style comes from the 2008 Beijing Olympic Games. When building the Beijing National Aquatics Center (typically called the Water Cube), two architectural firms—one Chinese and the other Australian—developed designs that were totally different. Although this created some tension, instead of fighting for their own ideas, the two sides came up with a totally new concept that excited everyone. The resulting award-winning building is spectacular.91

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C a CLEADER’S SELF-INSIGHT 10.3

How Do You Handle Team Conflict?

Instructions: Think about how you typically handle a dis- pute or disagreement with a team member, friend, or coworker, and then respond to the statements below based on whether they are Mostly False or Mostly True for you. There are no right or wrong answers, so answer honestly.

Mostly False

Mostly True

1. I try hard to win my position. 2. I strongly assert my opinion in a

disagreement. 3. I raise my voice to get other

people to accept my position. 4. I feel that differences are not

worth arguing about. 5. I would usually avoid a person

who wants to discuss a disagreement.

6. I would rather keep my views to myself than argue.

7. I give in a little if other people do the same.

8. I will split the difference to reach an agreement.

9. I typically give up some points in exchange for others.

10. I don’t want to hurt other people’s feelings.

11. I am quick to agree when some- one I am arguing with makes a good point.

12. I try to smooth over disagreements.

13. I suggest a solution that includes the other person’s point of view.

14. I consider the merits of other viewpoints as equal to my own.

15. I try to include the other person’s ideas to create an acceptable solution.

Scoring and Interpretation Five categories of conflict-handling strategies are measured in this instrument: dominating, avoiding, compromising, accommodating, and collaborating. By comparing your scores on the following five scales, you can identify your preferred or natural conflict-handling strategy by the high- est score.

To calculate your five scores, give yourself 1 point for each Mostly True answer for the three items indicated.

Dominating: Items 1, 2, 3: Avoiding: Items 4, 5, 6: Compromising: Items 7, 8, 9: Accommodating: Items 10, 11, 12: Collaborating: Items 13, 14, 15:

Briefly review the text material (pages 312–313) about these five strategies for handling conflict. Do you agree that your highest score represents the style you use the most? Which strategy do you find the most difficult to use? How would your conflict strategy differ if the other person was a family member rather than a team member? Can you think of a situation where a conflict strategy in which you are weak might be more effective? Explain your scores to another stu- dent and listen to the explanation for his or her scores.

Source: Adapted from “How Do You Handle Conflict?” in Robert E. Quinn et al., Becoming a Master Manager (New York: Wiley, 1990), pp. 221–223.

| D re am

st im e. co m

NEW LEADER ACTION MEMO As a leader, you can adopt the best approach for handling a team conflict. Choose among the dominating, avoiding, compromising, accommodating, or collaborating styles based on the degree of assertiveness and cooperativeness needed to manage the situation.

313 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Each of the five styles is appropriate in certain cases, and effective team mem- bers and leaders vary their style to fit the specific situation and the people involved.

Negotiation One distinctive type of conflict management is negotiation, whereby people engage in give-and-take discussions and consider various alternatives to reach a joint deci- sion that is acceptable to both parties. Negotiation is typically used when a conflict is formalized, such as between a union and management.

Ways to Negotiate Conflicting parties may embark on negotiation from different perspectives and with different intentions, reflecting either an integrative approach or a distributive approach.

Integrative negotiation is based on a win–win assumption, in that all parties want to come up with a creative solution that can benefit both sides. Rather than viewing the conflict as a win–lose situation, people look at the issues from multiple angles, consider trade-offs, and try to “expand the pie” rather than divide it. With integrative negotiation, conflicts are managed through cooperation and compromise, which fos- ters trust and positive long-term relationships. Distributive negotiation, on the other hand, assumes the “size of the pie” is fixed, and each party attempts to get as much of it as they can. One side wants to win, which means the other side must lose. With this win–lose approach, distributive negotiation is competitive and adversarial rather than collaborative, and it does not typically lead to positive long-term relationships.92

Most experts emphasize the value of integrative negotiation for today’s collabo- rative business environment. That is, the key to effectiveness is to see negotiation not as a zero-sum game but as a process for reaching a creative solution that benefits everyone.93

Rules for Reaching a Win–Win Solution Achieving a win–win solution through integrative negotiation is based on four key strategies:94

• Separate the People from the Problem. For successful integrative negotiation, people stay focused on the problem and the source of conflict rather than attacking or attempting to discredit each other.

• Focus on Underlying Interests, not Current Demands. Demands are what each person wants from the negotiation, whereas underlying interests represent the “why” behind the demands. Consider two sisters arguing over the last orange in the fruit bowl. Each insisted she should get the orange and refused to give up (demands). If one sister had asked the other why she wanted the orange (inter- ests), the sisters would have discovered that one wanted to eat it and the other wanted the peel to use for a project. By focusing on interests, the sisters would be able to arrive at a solution that gave each what she wanted.95 Demands cre- ate yes-or-no obstacles to effective negotiation, whereas underlying interests present problems that can be solved creatively.

• Listen and Ask Questions. A good strategy for most negotiations is to listen and ask questions. Leaders can learn more about their opponent’s position, their con- straints, and their needs by being quiet or asking questions. Smart negotiators want to learn the other side’s constraints so they can help overcome them. Effec- tive negotiators don’t dismiss the opposing party’s limitation as unreasonable or

314 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Integrative negotiation a cooperative approach to negotiation in which con- flicting parties attempt to reach a win–win solution

Distributive negotiation adversarial negotiation in which conflicting parties compete to win the most resources and give up as little as possible

think “that’s their problem.” Rather, they try to come up with a solution for the opponent so both parties can get closer to an agreement.

• Insist that Results be Based on Objective Standards. Each party in a negotiation has its own interests and would naturally like to maximize its outcomes. Successful negotiation requires focusing on objective criteria and maintaining standards of fairness rather than using subjective judgments about the best solution.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • Many leaders are called upon to facilitate teams rather than manage direct-report

subordinates. Teams can be effective in providing the coordination and informa- tion sharing needed to accomplish interdependent tasks. Functional teams typically are part of the traditional organization structure. Cross-departmental teams include people from different functional areas and are often formed for projects of special importance. Self-directed teams are member-centered rather than leader- centered and -directed.

• Teams present a dilemma for many people. Individuals have to give up their independence and sometimes make sacrifices for the good of the team. Other potential problems are free riders and dysfunctional teams.

• The team leader plays a big part in whether a team achieves high performance. Five things leaders provide that contribute to high performance are: compelling purpose and clear objectives, clear roles and diversity of skills, streamlined team size, decision authority over how to achieve goals, and support and coaching.

• Teams go through stages of development and change over time. Guiding a team through these stages is an important part of team leadership. In addition, lea- ders encourage team cohesiveness, help establish productive norms, and make sure people contribute their skills and competencies needed for the team to be effective. Every team must possess the following competencies: goal setting and performance management, planning and coordination, collaborative problem solving, communication, and conflict resolution. Team members take on various roles that meet both task needs and socioemotional needs.

• These principles apply to virtual and global teams as well. However, being a team leader is even more challenging when people are scattered in different geo- graphic locations and may be separated by language and cultural differences. To create effective, smoothly functioning virtual teams, leaders select team members who have the skills and temperaments to work virtually, use technol- ogy to build trusting relationships, and agree on ground rules for the team.

• All teams experience some conflict because of scarce resources, goal conflicts, or power and status differences. Leaders try to balance conflict and cooperation and use varied styles to handle conflict, including the dominating style, avoid- ing style, compromising style, accommodating style, and collaborating style. Each style can be effective in certain circumstances.

• One type of conflict management is negotiation. Good leaders try to use integra- tive negotiation, which is based on a win–win assumption, rather than distributive negotiation, in which each party strives to get as much as it can at the expense of the other party.

Tw itt er

CHAPTER 10 LEADING TEAMS 315

DISCUSSION QUESTIONS 1. What is the difference between a “team” and a “group”? Describe your personal expe-

rience with each.

2. Discuss the differences between a cross-departmental team and a self-directed team. Do you believe self-directed teams could be effectively used in certain types of organiza- tions? Explain.

3. Which of the five elements of high-performance teams do you think would be most difficult for a leader to implement in a virtual team? Explain.

4. Describe the stages of team development. How would you facilitate a team’s development through each stage?

5. How might an individual’s dilemma about teamwork be intensified or reduced in a virtual team? As a virtual team leader, what would you do to manage these dilemmas?

6. The chapter suggests that very small teams (say, three to six members) perform better, and most people prefer to work in small teams. However, many companies use teams of 100 or more people to perform complex tasks, such as creating and developing a new product. Do you think a unit of that size can truly function as a team? Discuss.

7. Discuss the relationship between team cohesiveness and performance. As a leader, can you think of specific ways you would encourage norms of cohesiveness and collaboration?

8. Think about a team you have participated in to do a class project or a sports team on which you participated. Can you identify members who played a task-specialist role and those who played a socioemotional role? What behaviors were associated with each?

9. What style of handling conflict do you typically use? Can you think of instances where a different style might have been more productive?

10. If you were the leader of a team developing a new computer game, how might you apply negotiation to resolve a conflict between two strong-willed members related to which features to include in the game?

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C a C

LEADERSHIP AT WORK Team Feedback Think back to your most recent experience working in a team, either at work or school. Write down your answers to the following questions about your role in the team.

What did the team members appreciate about you?

What did the team members learn from you?

316 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

What could the team members count on you for?

How could you have improved your contribution to the team?

Evaluate your answers. What is the overall meaning of your answers? What are the implications for your role as a team member? As a team leader?

In Class: “Team Feedback” is an excellent exercise to use for student feedback to one another after a specific team class project or other activities done together during the class. If there were no assigned team activities but students have gotten to know each other in class, they can be divided into groups and provide the information with respect to their par- ticipation in the class instead of in the student team.

The instructor can ask the student groups to sit in a circle facing one another. Then one person will volunteer to be the focal person, and each of the other team members will tell that team member the following:

• What I appreciate about you • What I learned from you • What I could count on you for • My one suggestion for improvement as a team leader/member

When the team members have given feedback to the focal person, another team member volunteers to hear feedback, and the process continues until each person has heard the four elements of feedback from every other team member.

The key questions for student learning are: Are you developing the skills and behaviors to be a team leader? If not, what does that mean for you? If you are now providing team leadership, how can you continue to grow and improve as a team leader?

Source: Thanks to William Miller for suggesting the questions for this exercise.

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C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Decision Time Ben Dooley and Casey Stringer had agreed to stop for coffee in the atrium Starbucks before heading up to the 35th floor for a board meeting.

“You seem deep in thought,” Ben said, placing the two cups of hot coffee on the table. “Watching Johnna and Robert in previous board meetings helps me to understand why the

folks in Congress can’t get anything done,” Casey mused. “Both sides have stated their positions and nothing, nothing will budge them. I dread this meeting. I’d rather have a root canal.”

“Well, while the two giants battle it out, the rest of us will have to work out some sort of compromise. We outsourced manufacturing operations to China several years ago to cut

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costs and now things are changing rapidly and we have a major decision. Does Bishop’s Engineered Plastics make the best of the situation in China …?”

“… Or do we re-shore?” Casey added. “Someone will have to be the voice of reason today,” Ben said. “Robert Ma has over-

seen the outsourcing to China and, initially, it was a great move.” “I agree the cost savings were pretty amazing. The retooling and creation of a state-

of-the-art factory in Wenzhou by the Chinese really propelled us to a new level within the industry.”

“Well, 2012 is the Year of the Dragon, and the dragon is having a problem,” Ben replied.

“Yes, Robert is going to have to face the fact that if we stay in China, we have to move from Wenzhou,” Casey pointed out. “The worker shortage is bad and getting worse. The last estimates for that region were one million workers short. As wages go up and other opportunities present themselves, manufacturing jobs are losing their appeal in the cities. In our plant the managers have to come down and work on the lines. That’s not good. Now, to try to stave off a mass industrial exodus, the Chinese are offering a stimulus to industries to relocate into the interior of the country. The interior offers more workers and lower wages …”

“And a factory move will delay manufacturing and make shipping even more difficult,” Ben replied. “Add to that the Chinese insistence on full payment before shipping, and we’re looking at some potentially serious delays.”

“Johnna, on the other hand, is going to argue that the situation in China is an indica- tion that now is the perfect time to re-shore—bring the jobs back to the good old U.S. of A.,” Casey said. “She’s going to dig in her heels on this one and you and I know that at least two members of that ‘august’ board are going to back off and let her have her way with no careful analysis of the pros and cons.” I sometimes think Frank is a people pleaser, always agreeable, especially toward Johnna, because she is the chair. And Martha usually doesn’t say anything, much less offer an opinion. She stares down at her hands when the going gets heavy.”

“The pros for Johnna are obvious—bring jobs home when jobs are needed; shorten the supply line, reduce shipping costs, offer faster response to customers; and, I believe, offer a better quality product. It is worth a little higher labor cost.”

“And what are the cons?” “The problems are the higher wages here and the cost of retooling factories in this

country that have been down for a few years.” “But,” Casey asked, “Would we have to build a new factory deep in China’s interior?

No. And will their interior workforce be adequately trained? I would guess not. The Chinese government will help with building and relocation costs, but still ….”

“So both Johnna and Robert have a strong argument and some glaring weaknesses. Is there room in here for a compromise? That’s what I would like to see. They would both get something,” opined Ben.

“I don’t know. I’m eager to see what each one of them presents. It should be an inter- esting conversation.”

“Or an afternoon in hell,” Ben said as the two headed for the elevator. “I wonder what you and I might do to help Johnna and Robert resolve this conflict. What do you think we should do, Casey?”

QUESTIONS

1. What styles for handling conflict appear among the board members? Explain.

2. What options do Ben and Casey have for helping resolve the conflict between Johnna and Robert? What conflict styles might they adopt for this meeting?

3. What suggestions would you make to help board members arrive at a good team decision?

318 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Devereaux-Dering Group Dashing to catch a cab at the corner of Sixth and Vine, the account team was exhilarated. After a quick exchange of high fives, three of the four jumped into the backseat of a cab to return to the Manhattan offices of Devereaux-Dering, a global advertising agency with offices in New York, Hong Kong, and Paris. The team couldn’t wait to tell their team leader, Kurt Lansing, that they had won the BMW account that morning. The fourth team member, Brad Fitzgerald, stood apart from the animated group, studying his BlackBerry and then hailing a cab for an afternoon flight out of LaGuardia.

After a two-year slump in sales, Devereaux-Dering needed a big score like the BMW account. To drive new business and land high-profile accounts like this one, the company had hired Kurt Lansing, an MBA from Wharton, with prominent status in the advertising industry. His job was to lead a new business team to study the market, develop strategies, and acquire major accounts. Lansing hand-selected four high achievers for his team that represented each area of the business: Brad Fitzgerald, creative director; Trish Roderick, account services; Adrienne Walsh, production manager; and Tyler Green, brand strategy.

“That was a shocker!” said Roderick as she scooted across the backseat of the cab to make room for her teammates. “The client didn’t seem too impressed with our presentation until Fitzgerald presented the last set of slides describing the global campaign. They loved it. I think he single-handedly clinched the deal when he presented the tag line for the Asian market,” she said excitedly.

“He’s a real whiz, alright,” muttered Green. “The eighth wonder of the world.” Sighing deeply and losing his earlier exuberance, Green said, “We couldn’t have bagged the deal without him, and I know we’ll all get credit. But none of us knew he planned to present that last part of the global campaign. I know he was working on that tag line late last night, but there was plenty of time this morning to get team input on it. I hate surprises in front of a client. I felt like a fool, even if we did win the business.”

“He’s a regular white knight,” chuckled Walsh, “riding in at the last minute to save the day. I suppose we should appreciate him, but he’s just so irritating. He snapped at me last week for not telling him about a client who was upset about delays in their ad campaign. I reminded him that I had told him about it in our status meeting, but he wasn’t listening at the time. He was glued to his precious BlackBerry, as usual. Why have team meetings if he isn’t going to participate?”

Roderick was surprised by her teammates’ reaction to Fitzgerald. She thought they had been working well together. She was quickly discovering, however, an undercurrent of resent- ment. This was the first time that she had been exposed to the conflict that was simmering below the surface. No doubt, Fitzgerald did have a strong ego and aggressive personality. A pre- viously successful entrepreneur, Fitzgerald had a track record of success and was very ambitious. However, she did notice that he didn’t show respect for differing opinions or invite collaboration on ideas. She wondered if he was placing his own success above the team’s. But why complain if the team was sharing the credit and earning fat bonuses along with him? She was content to go with the status quo. “You know,” she said, “we’re darn lucky to be on his team.”

She stared out the cab window at the passing traffic and listened to her two teammates con- tinue to grouse. “I should have known something was up when I walked past his office last night and saw him working with the new copywriter. They must have been hashing out the new tag line,” smirked Green. “We are a team, aren’t we? The system is bigger than the individ- ual, remember? He doesn’t seem too concerned about the welfare of the team—only his own.”

“Well, let’s all have a heart-to-heart with Mr. McWhiz,” said Walsh sarcastically. “I’m sure he’ll see things our way. We’ll give him a brief overview of Teamwork 101. That will go over great!” As the cab pulled to the curb, they tossed the driver a $20 bill and headed to their offices on the 40th floor. They would all stop to see the team leader, Kurt Lansing, first.

In the meantime, Lansing smiled broadly when he received Fitzgerald’s text message that they had won the BMW account. Sinking back in his chair, he marveled at the

CHAPTER 10 LEADING TEAMS 319

cohesiveness and success of his team. All that time building a shared vision and building trust was starting to pay off.

QUESTIONS

1. What factors do you think are affecting this team’s cohesiveness? Explain.

2. If you were the team leader, what could you do to bring Fitzgerald into the team more and foster better relationships among the team members?

3. As a team member, what would you do? Should the three members of the team con- front Fitzgerald with their concerns? Should they inform Kurt Lansing? Explain your answers.

REFERENCES 1. Doug Kirkpatrick, “Self-Management’s Success at Morning Star,”

T D (October 2012), pp. 25–27.

2. Linda I. Glassop, “The Organizational Benefit of Teams,” Human Relations 55, no. 2 (2002), pp. 225–249; and J. D. Osburn, L. Moran, E. Musselwhite, and J. H. Zenger, Self-Directed Work Teams: The New American Challenge (Homewood, IL: New York: Business One Irwin, 1990).

3. This definition is based on J. Richard Hackman, Leading Teams: Setting the Stage for Great Performances (Boston: Harvard Business School Press, 2002); Dawn R. Utley and Stephanie E. Brown, “Establishing Characteristic Differences between Team and Working Group Behaviors,” Institute of Industrial Engineers Annual Con- ference Proceedings (2010), pp. 1–6; and Carl E. Larson and Frank M. J. LaFasto, Team Work (Newbury Park, CA: Sage Publications, 1989).

4. Somini Sengupta, “For Search, Facebook Had to Go beyond ‘Robospeak,’” The New York Times (January 28, 2013), http:// www.nytimes.com/2013/01/29/business/how-facebook-taught-its -search-tool-to-understand-people.html?pagewanted=all&_r=0 (accessed May 3, 2013).

5. Chuck Salter, “What LeBron James and the Miami Heat Teach Us about Teamwork,” Fast Company (April 2011), http://www.fastcompany.com /magazine/155/the-worlds-greatest-chemistry-experiment.html (accessed April 25, 2011).

6. Ibid.

7. Telis Demos, “Cirque du Balancing Act,” Fortune (June 12, 2006), p. 114; Erin White, “How a Company Made Everyone a Team Player,” The Wall Street Journal (August 13, 2007); and David Kirkpatrick, “Inside Sam’s $100 Billion Growth Machine,” Fortune (June 14, 2004), pp. 80–98.

8. “A Company of ‘Level 5’ Leaders,” Inc. (June 2010), pp. 87–88; and Miri McDonald, “Tasty Catering on Driving Engagement through Empowerment and Shared Decision Making,” SmartBlog on Leadership (April 15, 2011), https://smartblogs.com/leadership/2011 /04/15/tasty-catering-on-driving-engagement-through-transparency-and -shared-decision-making/ (accessed June 12, 2013) .

9. Bryce G. Hoffman, “Inside Ford’s Fight to Avoid Disaster,” The Wall Street Journal (March 9, 2012), p. B1.

10. This discussion of self-directed teams is based on Patricia Booth, “Embracing the Team Concept,” Canadian Business Review (Autumn 1994), pp. 10–13; Pierre van Amelsvoort and Jos Benders, “Team Time: A Model for Developing Self-Directed Work Teams,” International Journal of Operations and Production Management 16, no. 2 (1996), pp. 159–170; and Jeanne M. Wilson, Jill George, and Richard S. Wellins, with William C. Byham, Leadership

Trapeze: Strategies for Leadership in Team-Based Organizations (San Francisco: Jossey-Bass, 1994).

11. Heleen van Mierlo, Christel G. Rutte, Michiel A. J. Kompier, and Hans A.C.M. Doorewaard, “Self-Managing Teamwork and Psycho- logical Well-Being: Review of a Multilevel Research Domain,” Group & Organization Management 30, no. 2 (2005), pp. 211–235.

12. Wilson et al., Leadership Trapeze.

13. Jill Jusko, “Engaged Teams Keep Lockheed Martin Delivering on Time, Every Time,” IndustryWeek (January 2013), p. 26.

14. Kenneth Labich, “Elite Teams Get the Job Done,” Fortune (February 19, 1996), pp. 90–99.

15. White, “How a Company Made Everyone a Team Player.”

16. Study by G. Clotaire Rapaille, reported in Karen Bernowski, “What Makes American Teams Tick?” Quality Progress 28, no. 1 (January 1995), pp. 39–42.

17. Robert Albanese and David D. Van Fleet, “Rational Behavior in Groups: The Free-Riding Tendency,” Academy of Management Review 10 (1985), pp. 244–255.

18. Reported in Matt Vella, “White Collar Workers Shoulder Together— Like It or Not” (Inside Innovation section: InData), BusinessWeek (April 28, 2008), p. 58.

19. See David H. Freedman, “The Idiocy of Crowds” (What’s Next column), Inc. (September 2006), pp. 61–62; “Why Some Teams Succeed (and So Many Don’t),” Harvard Management Update (October 2006), pp. 3–4; and Geoffrey Colvin, “Why Dream Teams Fail,” Fortune (June 12, 2006), pp. 87–92.

20. Jared Sandberg, “Some Ideas Are So Bad That Only Team Efforts Can Account for Them” (Cubicle Culture column), The Wall Street Journal (September 29, 2004).

21. Patrick Lencioni, The Five Dysfunctions of a Team (New York: John Wiley & Sons, 2002).

22. “Why Some Teams Succeed (and So Many Don’t).”

23. Studies reported in Amy Edmondson, Richard Bohmer, and Gary Pisano, “Speeding Up Team Learning,” Harvard Business Review (October 2001), pp. 125–132; and Scott Thurm, “Teamwork Raises Everyone’s Game—Having Everyone Bond Benefits Companies More Than Promoting Stars” (Theory & Practice column), The Wall Street Journal (November 7, 2005), p. B8.

24. Stephen H. Courtright, Greg L. Stewart, and Marcia M. Ward, “Applying Research to Save Lives: Learning from Team Training Approaches in Aviation and Health Care,” Organizational Dynamics 41 (2012), pp. 291–301.

25. These factors are based partly on “Why Some Teams Succeed (and So Many Don’t)”; Ruth Wageman, “Critical Success Factors for

320 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Creating Superb Self-Managing Teams,” Organizational Dynamics (Summer 1997), pp. 49–61; and Richard Hackman, Leading Teams: Setting the Stage for Great Performances (Boston, MA: Harvard Business School Press, 2002).

26. J. Polzer, W. Swann Jr., and L. Milton, “The Benefits of Verifying Diverse Identities for Group Performance,” in M. Neale, E. Mannix, and J. Polzer, eds., Research on Managing Groups and Teams: Identity Issues in Groups, Vol. 5 (Stamford, CT: JAI Press, 2003), pp. 91–112.

27. Warren E. Watson, Kamalesh Kumar, and Larry K. Michaelsen, “Cultural Diversity’s Impact on Interaction Process and Performance: Comparing Homogeneous and Diverse Task Groups,” Academy of Management Journal 36 (1993), pp. 590–602; and Gail Robinson and Kathleen Dechant, “Building a Business Case for Diversity,” Academy of Management Executive 11, no. 3 (1997), pp. 21–31.

28. Lynda Gratton and Tamara J. Erickson, “Eight Ways to Build Collaborative Teams,” Harvard Business Review (November 2007), pp. 101–109.

29. Jeffrey T. Polzer, “Leading Teams,” Harvard Business Publishing for Educators, Background Note, Product #403094-PDF-ENG (ordered at http://cb.hbsp.harvard.edu/cb/product/403094-PDF-ENG).

30. This summary of team size research is based on Martin Hoegl, “Smaller Teams—Better Teamwork: How to Keep Project Teams Small,” Business Horizons 48 (2005), pp. 209–214; Lillian Chaney and Julie Lyden, “Making U.S. Teams Work,” Supervision (January 2000), p. 6; Jia Lynn Yang, “The Power of Number 4.6,” part of a special series, “Secrets of Greatness: Teamwork,” Fortune (June 12, 2006), p. 122; M. E. Shaw, Group Dynamics, 3rd ed. (New York: McGraw Hill, 1981); and G. Manners, “Another Look at Group Size, Group Problem Solving, and Group Consensus,” Academy of Management Journal 18 (1975), pp. 715–724.

31. Gallup poll results reported in “Viva La Difference,” box in Julie Connelly, “All Together Now,” Gallup Management Journal (Spring 2002), pp. 13–18.

32. Stephen D. Reicher, Michael J. Platow, and S. Alexander Haslam, “The New Psychology of Leadership,” Scientific American Mind (August–September 2007), pp. 23–29.

33. C. Shawn Burke, Kevin C. Stagl, Cameron Klein, Gerald F. Goodwin, Eduardo Salas, and Stanley M. Halpin, “What Type of Leadership Behaviors Are Functional in Teams? A Meta-Analysis,” The Leadership Quarterly 17 (2006), pp. 288–307; Greg L. Stewart, “A Meta-Analytic Review of Relationships between Team Design Features and Team Performance,” Journal of Management 32, no. 1 (February 2006), pp. 29–54; Abhishek Srivastava, Kathryn M. Bartol, and Edwin A. Locke, “Empowering Leadership in Management Teams: Effects on Knowledge Sharing, Efficacy, and Performance,” Academy of Manage- ment Journal 49, no. 6 (December 2006), pp. 1239–1251; and Gratton and Erickson, “Eight Ways to Build Collaborative Teams.”

34. Gervase R. Bushe and Graeme H. Coetzer, “Group Development and Team Effectiveness: Using Cognitive Representations to Measure Group Development and Predict Task Performance and Group Viability,” The Journal of Applied Behavioral Science 43, no. 2 (June 2007), pp. 184–212; Kenneth G. Koehler, “Effective Team Management,” Small Business Report (July 19, 1989), pp. 14–16; Connie J. G. Gersick, “Time and Transition in Work Teams: Toward a New Model of Group Development,” Academy of Management Journal 31 (1988), pp. 9–41; and John Beck and Neil Yeager, “Moving beyond Myths,” Training & Development (March 1996), pp. 51–55.

35. Bruce W. Tuckman, “Developmental Sequence in Small Groups,” Psychological Bulletin 63 (1965), pp. 384–399; and B. W. Tuckman and M. A. Jensen, “Stages of Small Group Development Revisited,” Group and Organizational Studies 2 (1977), pp. 419–427.

36. Oluremi B. Ayoko, Alison M. Konrad, and Maree V. Boyle, “Online Work: Managing Conflict and Emotions for Performance in Virtual Teams,” European Management Journal 30 (2012), pp. 156–174.

37. Ibid.

38. This is based on a true story of an anonymous company reported in Vicki Fuller Hudson, “From Divided to Ignited to United,” Industrial Management (May–June 2010), pp. 17–20.

39. Shaw, Group Dynamics.

40. Daniel C. Feldman and Hugh J. Arnold, Managing Individual and Group Behavior in Organizations (New York: McGraw-Hill, 1983).

41. Harold J. Leavitt and Jean Lipman-Blumen, “Hot Groups,” Harvard Business Review (July–August 1995), pp. 109–116.

42. Amanuel G. Tekleab, Narda R. Quigley, and Paul E. Tesluk, “A Longitudinal Study of Team Conflict, Conflict Management, Cohe- sion, and Team Effectiveness,” Group & Organization Management 34, no. 2 (April 2009), pp. 170–205; Dorwin Cartwright and Alvin Zander, Group Dynamics: Research and Theory, 3rd ed. (New York: Harper & Row, 1968); Elliot Aronson, The Social Animal (San Francisco: W. H. Freeman, 1976); and Thomas Li-Ping Tang and Amy Beth Crofford, “Self-Managing Work Teams,” Employment Relations Today (Winter 1995/96), pp. 29–39.

43. Vishal K. Gupta, Rui Huang, and Suman Niranjan, “A Longitudinal Examination of the Relationship between Team Leadership and Performance,” Journal of Leadership and Organizational Studies 17, no. 4 (2010), pp. 335–350; and Marcial Losada and Emily Heaphy, “The Role of Positivity and Connectivity in the Performance of Business Teams,” American Behavioral Scientist 47, no. 6 (February 2004), pp. 740–765.

44. Bank of America example from Rachel Emma Silverman, “Tracking Sensors Invade the Workplace; Devices on Workers, Furniture Offer Clues for Boosting Productivity,” The Wall Street Journal (March 7, 2013), http:// online.wsj.com/article/SB10001424127887324034804578344303429080 678.html (accessed May 3, 2013); and studies reported in Tang and Crofford, “Self-Managing Work Teams.”

45. Shlomo Ben-Hur, Nikolas Kinley, and Karsten Jonsen, “Coaching Executive Teams to Reach Better Decisions,” Journal of Management Development 31, no. 7 (2012), pp. 711–723.

46. Stanley E. Seashore, Group Cohesiveness in the Industrial Work Group (Ann Arbor, MI: Institute for Social Research, 1954).

47. J. Richard Hackman, “Group Influences on Individuals,” in M. Dunnette, ed., Handbook of Industrial and Organizational Psychol- ogy (Chicago: Rand McNally, 1976).

48. These are based on Daniel C. Feldman, “The Development and Enforcement of Group Norms,” Academy of Management Review 9 (1984), pp. 47–53.

49. Wilson et al., Leadership Trapeze, p. 12.

50. Simon Taggar and Robert Ellis, “The Role of Leaders in Shaping Formal Team Norms,” The Leadership Quarterly 18 (2007), pp. 105–120.

51. Colvin, “Why Dream Teams Fail.”

52. Matt Moffett, “Trapped Miners Kept Focus, Shared Tuna—Foiled Escape, Bid to Organize Marked First Two Weeks Underground in Chile,” The Wall Street Journal (August 25, 2010); and “Lessons on Leadership and Teamwork—From 700 Meters below the Earth’s Surface,” Universia Knowledge @ Wharton (September 22, 2010), http://www.wharton.universia.net/index.cfm?fa=viewArticle&id =1943&language=english (accessed September 29, 2010).

53. These are based on Michael J. Stevens and Michael A. Campion, “The Knowledge, Skill, and Ability Requirements for Teamwork: Implica- tions for Human Resource Management,” Journal of Management 20, no. 2 (1994), pp. 503–530.

CHAPTER 10 LEADING TEAMS 321

54. R. Oser, G. A. McCallum, E. Salas, and B. B. Morgan, Toward a Definition of Teamwork: An Analysis of Critical Team Behaviors, Technical Report NTSC 89-004 (Arlington, VA: Office of Naval Research, 1989); and A. S. Glickman, S. Zimmer, R. C. Montero et al., The Evolution of Team Skills: An Empirical Assessment with Implications for Training, Technical Report NTSC 87-016 (Arlington, VA: Office of Naval Research, 1987).

55. Robert A. Baron, Behavior in Organizations, 2nd ed. (Boston: Allyn & Bacon, 1986).

56. Ibid.

57. Reported in Gratton and Erickson, “Eight Ways to Build Collabora- tive Teams.”

58. The discussion of virtual teams is based on Anthony M. Townsend, Samuel M. DeMarie, and Anthony R. Hendrickson, “Virtual Teams: Technology and the Workplace of the Future,” Academy of Manage- ment Executive 12, no. 3 (August 1998), pp. 17–29; Deborah L. Duarte and Nancy Tennant Snyder, Mastering Virtual Teams (San Francisco: Jossey-Bass, 1999); and Jessica Lipnack and Jeffrey Stamps, “Virtual Teams: The New Way to Work,” Strategy & Leadership (January–February 1999), pp. 14–18.

59. Vijay Govindarajan and Anil K. Gupta, “Building an Effective Global Business Team,” MIT Sloan Management Review 42, no. 4 (Summer 2001), pp. 63–71.

60. Bradford W. Bell and Steve W. J. Kozlowski, “A Typology of Virtual Teams: Implications for Effective Leadership,” Group & Organiza- tion Management 27, no. 1 (March 2002), pp. 14–49.

61. Joann S. Lublin, “Smart Balance Keeps Tight Focus on Creativity” (Theory & Practice column), The Wall Street Journal (June 8, 2009); and Rebecca Reisner, “A Smart Balance of Staff and Contractors,” BusinessWeek Online (June 16, 2009), http://www.businessweek .com/managing/content/jun2009/ca20090616_217232.htm (accessed April 30, 2010).

62. Survey by Society for Human Resource Management, reported in “Team Relationships, Time Differences Are Hampering Virtual Teams,” T D (October 2012), p. 18; and Survey by RW3Culture- Wizard, reported in Golnaz Sadri and John Condia, “Managing the Virtual World,” Industrial Management (January–February 2012), pp. 21–25.

63. Reported in Sadri and Condia, “Managing the Virtual World.”

64. Donna J. Dennis, Deborah Meola, and M. J. Hall, “Effective Leadership in a Virtual Workforce,” T D (February 2013), pp. 47–51; Karen Sobel Lojeski, Leading the Virtual Workforce: How Great Leaders Transform Organizations in the 21st Century (Hoboken, NJ, 2010); Stacie A. Furst, Martha Reeves, Benson Rosen, and Richard S. Blackburn, “Managing the Life Cycle of Virtual Teams,” Academy of Management Executive 18, no. 2 (2004), pp. 6–20; R. E. Potter and P. A. Balthazard, “Understanding Human Interaction and Performance in the Virtual Team,” Journal of Information Technology Theory and Application 4 (2002), pp. 1–23; and Kenneth W. Kerber and Anthony F. Buono, “Leader- ship Challenges in Global Virtual Teams: Lessons from the Field,” SAM Advanced Management Journal (Autumn 2004), pp. 4–10.

65. Reported in Karen Sobel Lojeski, Leading the Virtual Workforce.

66. The discussion of these challenges is based on “Team Relationships, Time Differences Are Hampering Virtual Teams”; Dennis et al., “Effective Leadership in a Virtual Workforce”; Bradford S. Bell and Steve W. J. Kozlowski, “A Typology of Virtual Teams: Implications for Effective Leadership,” Group & Organization Management 27, no. 1 (March 2002), pp. 14–49; Lipnack and Stamps, “Virtual Teams: The New Way to Work”; and Jon R. Katzenbach and Douglas K. Smith, “The Discipline of Virtual Teams,” Leader to Leader (Fall 2001), pp. 16–25.

67. Interview in Dennis et al., “Effective Leadership in a Virtual Workforce.”

68. This discussion is based on Arvind Malhotra, Ann Majchrzak, and Benson Rosen, “Leading Virtual Teams,” Academy of Management Perspectives 21, no. 1 (February 2007), pp. 60–69; Benson Rosen, Stacie Furst, and Richard Blackburn, “Overcoming Barriers to Knowledge Sharing in Virtual Teams,” Organizational Dynamics 36, no. 3 (2007), pp. 259–273; Marshall Goldsmith, “Crossing the Cultural Chasm; Keeping Communication Clear and Consistent with Team Members from Other Countries Isn’t Easy, Says Author Maya Hu-Chan,” Business Week Online (May 31, 2007), http://www .businessweek.com/careers/content/may2007/ca20070530_521679 .htm (accessed August 24, 2007); Bradley L. Kirkman, Benson Rosen, Cristina B. Gibson, Paul E. Tesluk, and Simon O. McPherson, “Five Challenges to Virtual Team Success: Lessons from Sabre, Inc.,” Academy of Management Executive 16, no. 3 (2002), pp. 67–79; Penelope Sue Greenberg, Ralph H. Greenberg, and Yvonne Lederer Antonucci, “Creating and Sustaining Trust in Virtual Teams,” Business Horizons 50 (2007), pp. 325–333; and Elizabeth Garone, “Bonding with Remote Workers Valuable Asset,” The Wall Street Journal (May 11, 2008), p. H1.

69. Terri L. Griffith and Margaret A. Neale, “Information Processing in Traditional, Hybrid, and Virtual Teams: From Nascent Knowledge to Transactive Memory,” Research in Organizational Behavior 23 (2001), pp. 379–421.

70. Dennis et al., “Effective Leadership in a Virtual Workforce”; Ron Young, “The Wide-Awake Club,” People Management (February 5, 1998), pp. 46–49; and Steve Schloss, “Listening Is the Most Powerful Connection-Building Tool,” People & Strategy 35, no. 1 (2012), p. 9.

71. Charlene Marmer Solomon, “Building Teams across Borders,” Workforce (November 1998), pp. 12–17; and Steve Schloss, “Listen- ing Is the Most Powerful Connection-Building Tool.”

72. Richard Lepsinger, “The Virtual Challenge: It’s More than Cultural Differences,” People & Strategy 35, no. 1 (2012), pp. 10–11; and Alanah Mitchell, “Interventions for Effectively Leading in a Virtual Setting,” Business Horizons 55 (2012), pp. 431–439.

73. Keith Ferrazi, “How to Build Trust in a Virtual Workplace,” Harvard Business Review Blog Network (October 8, 2012), http://blogs.hbr .org/cs/2012/10/how_to_build_trust_in_virtual.html (accessed May 6, 2013).

74. Ann Majchrzak, Arvind Malhotra, Jeffrey Stamps, and Jessica Lipnack, “Can Absence Make a Team Grow Stronger?” Harvard Business Review 82, no. 5 (May 2004), pp. 131–137.

75. Kevan Hall, “Culture Is Always Half about Them and Half about Us,” People & Strategy 35, no. 1 (2012), pp. 9–10.

76. Lynda Gratton, “Working Together … When Apart,” The Wall Street Journal (June 18, 2007), p. R1; and Kirkman et al., “Five Challenges to Virtual Team Success.”

77. S. J. Zaccaro and P. Bader, “E-Leadership and the Challenges of Leading E-Teams: Minimizing the Bad and Maximizing the Good,” Organizational Dynamics 31, no. 4 (2002), pp. 377–387; and Yuhyung Shin, “Conflict Resolution in Virtual Teams,” Organiza- tional Dynamics 34, no. 4 (2005), pp. 331–345.

78. Debra L. Shapiro, Stacie A. Furst, Gretchen M. Spreitzer, and Mary Ann Von Glinow, “Transnational Teams in the Electronic Age: Are Team Identity and High Performance at Risk?” Journal of Organiza- tional Behavior 23 (2002), pp. 455–467.

79. Stephen P. Robbins, Managing Organizational Conflict: A Nontradi- tional Approach (Englewood Cliffs, NJ: Prentice Hall, 1974).

80. Tekleab et al., “A Longitudinal Study of Team Conflict, Conflict Management, Cohesion, and Team Effectiveness.”

81. Karen A. Jehn and Elizabeth A. Mannix, “The Dynamic Nature of Conflict: A Longitudinal Study of Intragroup Conflict and Group Performance,” Academy of Management Journal 44, no. 2 (2001), pp. 238–251.

322 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

82. Based on K. A. Jehn, “A Multimethod Examination of the Benefits and Determinants of Intragroup Conflict,” Administrative Science Quarterly 40 (1995), pp. 256–282; and K. A. Jehn, “A Qualitative Analysis of Conflict Types and Dimensions in Organizational Groups,” Administrative Science Quarterly 42 (1997), pp. 530–557.

83. Sandra G. Boodman, “Anger Management Courses Are a New Tool for Dealing with Out-of-Control Doctors,” The Washington Post (March 4, 2013), http://articles.washingtonpost.com/2013-03-04 /national/37429827_1_behavior-doctors-nurses-act (accessed May 6, 2013).

84. A. Amason, “Distinguishing the Effects of Functional and Dysfunc- tional Conflict on Strategic Decision Making: Resolving a Paradox for Top Management Teams,” Academy of Management Journal 39, no. 1 (1996), pp. 123–148; Jehn, “A Multimethod Examination of the Benefits and Determinants of Intragroup Conflict”; and K. A. Jehn and E. A. Mannix, “The Dynamic Nature of Conflict: A Longitudinal Study of Intragroup Conflict and Group Performance,” Academy of Management Journal 44 (2001), pp. 238–251.

85. Amason, “Distinguishing the Effects of Functional and Dysfunctional Conflict on Strategic Decision Making.”

86. Dean Tjosvold, Chun Hui, Daniel Z. Ding, and Junchen Hu, “Conflict Values and Team Relationships: Conflict’s Contribution to Team Effectiveness and Citizenship in China,” Journal of Organizational Behavior 24 (2003), pp. 69–88; C. De Dreu and E. Van de Vliert, Using Conflict in Organizations (Beverly Hills, CA: Sage, 1997); and Kathleen M. Eisenhardt, Jean L. Kahwajy, and L. J. Bourgeois III, “Conflict and Strategic Choice: How Top Management Teams Disagree,” California Management Review 39, no. 2 (Winter 1997), pp. 42–62.

87. Koehler, “Effective Team Management”; and Dean Tjosvold, “Making Conflict Productive,” Personnel Administrator 29 (June 1984), p. 121.

88. This discussion is based in part on Richard L. Daft, Organization Theory and Design (St. Paul, MN: West, 1992), chapter 13; and Paul M. Terry, “Conflict Management,” The Journal of Leadership Studies 3, no. 2 (1996), pp. 3–21.

89. Jessica Silver-Greenberg and Nelson D. Schwartz, “Discord at Key JPMorgan Unit Is Blamed in Bank’s Huge Loss,” The New York Times (May 20, 2012), p. A1.

90. This discussion is based on Kenneth W. Thomas, “Towards Multi- dimensional Values in Teaching: The Example of Conflict Behaviors,” Academy of Management Review 2, no. 3 (July 1977), pp. 484–490.

91. Reported in Amy C. Edmondson, “Teamwork on the Fly,” Harvard Business Review (April 2012), pp. 72–80.

92. “Negotiation Types,” The Negotiation Experts Website (June 9, 2010), http://www.negotiations.com/articles/negotiation-types/ (accessed September 28, 2010).

93. Rob Walker, “Take It or Leave It: The Only Guide to Negotiating You Will Ever Need,” Inc. (August 2003), pp. 75–82.

94. Based on Roger Fisher and William Ury, Getting to Yes: Negotiating Agreement Without Giving In (New York: Penguin, 1983); Walker, “Take It or Leave It”; Robb Mandelbaum, “How to Negotiate Effectively,” Inc. (November 1, 2010), http://www.inc.com/magazine /20101101/how-to-negotiate-effectively.html (accessed April 12, 2011); and Deepak Malhotra and Max H. Bazerman, “Investigative Negotiation,” Harvard Business Review (September 2007), pp. 72–78.

95. Variations of this familiar story have been reported in many publications, including “Getting to the Point with Interest-Based Negotiations,” The Negotiation Skills Company, http://www .negotiationskills.com/articleB4.php (accessed June 25, 2013); and “Negotiating Skills: Win-Win Deals,” Manage Train Learn Website, http://www.managetrainlearn.com/page/win-win-deals (accessed June 25, 2013).

CHAPTER 10 LEADING TEAMS 323

Chapter 11: Developing Leadership Diversity

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Understand and reduce the difficulties faced by minorities in organizations. • Apply an awareness of the dimensions of diversity and multicultural issues in your everyday life. • Encourage and support diversity to meet organizational needs. • Consider the role of cultural values and attitudes in determining how to deal with employees from

different cultures or ethnic backgrounds.

• Break down your personal barriers that may stand in the way of becoming an inclusive leader. • Use sponsorship and employee affinity groups to support female and minority participation and

advancement.

CHAPTER OUTLINE 326 Leading People Who Aren’t

Like You

327 Diversity Today

330 Challenges Minorities Face

336 Ways Women Lead

339 Global Diversity

344 Becoming an Inclusive Leader

348 Ways to Encourage the Advancement of Women and Minorities

In the Lead

329 Secret Intelligence Service (M16) and Central Intelligence Agency (CIA)

334 MetLife

338 Cindy Szadokierski, United Airlines

346 Rachelle Hood, Denny’s Restaurants

Leader’s Self-Insight

327 Values Balancing

331 Unconscious Bias

341 Social Values

Leader’s Bookshelf

334 Lean In: Women, Work, and the Will to Lead

Leadership at Work

351 Personal Diversity

Leadership Development: Cases for Analysis

352 True to Myself

353 The Trouble with Bangles

N ationwide retailer Wet Seal offers “fast fashion at affordable prices” to a core customer group of 13- to 23-year-olds. Young women love fun and trendy clothes, and Wet Seal, based in Foothill Ranch, California, has

grown rapidly by providing them in mall stores and online. But some African American former store managers say the company provides something else as well— an example of “old-school, straight-up discrimination,” as their lawyer Brad Seligman puts it. Three former managers have filed a federal racial discrimination suit charging that Wet Seal has a policy of firing and denying promotions to African Americans because they don’t fit the company’s brand image. One of the plaintiffs says that after she was fired, she heard a senior vice president tell the district manager she wanted someone with blond hair and blue eyes. Other former managers report hearing of high-level requests to “lighten up” the workforce. An e-mail message from a senior manager for store operations submitted as part of the lawsuit grumbles that “African Americans dominate—huge issue.”1

Wet Seal is accused of being a company where discrimination is “not only tolerated, but required.” If true, it is almost stunning that this kind of blatant discrimination still occurs. Leaders at most companies strive to avoid discriminatory policies and practices that lead to lawsuits. In addition, many companies have learned

325 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

that valuing and supporting diverse employees pays off. Today’s best leaders realize that diversity sparks innovation, leads to better decision making, and spurs growth. Yet subtle bias and hidden discrimination is still a significant problem in many organizations, and intermittent grievous acts such as the ones at Wet Seal also occur.

Today, every leader needs to understand the complexity of diversity issues, learn to create an inclusive culture, and support the development of minorities for higher level leadership positions. One of the most important roles for leaders in the coming years will be developing a solid base of diverse leadership talent. “In any organization in America, you will see diversity at the bottom of the house,” says Roberta (Bobbi) Gutman, former vice president and director of global diversity at Motorola. “But to get it higher up takes the clout and the wingspan of company leadership.”2

This chapter explores the topic of diversity and multiculturalism. First, we look at the difficulties leaders encounter in leading people who are different from themselves. Then we define diversity, explore the value of diversity for organizations, and look at some challenges minorities face in organizations. Next, we examine a style of leadership that can support a more inclusive work environment, take a closer look at global diversity, and explore how leaders can increase their cultural intelligence quotient (CQ). Finally, we discuss the personal stages of leader diversity awareness and some ways leaders can support the career advancement of diverse people in the workplace.

LEADING PEOPLE WHO AREN’T LIKE YOU How does an African American, Asian, or Hispanic manager lead an all-white workforce, or a female manager lead a workforce of mostly males? How do white male top executives interact effectively and supportively with minority and female colleagues? What happens when a 29-year-old is promoted to a position of author- ity over a group of mostly 50- to 60-year-old middle managers? As organizations grow increasingly diverse, these questions are being asked more and more often. Consider Clarence Otis, CEO of Darden Restaurants (Olive Garden, Red Lobster), one of only a handful of African American CEOs running Fortune 500 companies, or Cathy Lanier, the white female chief of the Washington, D.C., Metropolitan Police, who leads a mostly black and male workforce.

The benefits of diversity, which we will talk about later in this chapter, are one reason the face of America’s organizations is beginning to change, with women and minorities slowly moving into upper-level leadership positions. However, there are still many challenges for creating diverse organizations with inclusive cultures. As women and minorities move up the management hierarchy, they’re often finding it a lonely road to travel. Even for someone who has experienced a degree of racism or sexism at lower organizational levels, stepping into a position of higher authority can be a real eye-opener. Racism and sexism in the workplace often show up in subtle ways—the disregard by a subordinate for an assigned chore, a lack of urgency in com- pleting an important assignment, the ignoring of comments or suggestions made at a team meeting. “I could go to a meeting and offer an opinion, and it was like I didn’t even say a word,” said Christine Dale. “A guy can offer the same opinion and it’s like, ‘Oh, that’s brilliant.’ ”3 Many minority leaders struggle daily with the problem of dele- gating authority and responsibility to employees who show them little respect.

The cultural values and organizational systems in many companies do not gen- uinely support and value diversity. By the end of this chapter, we hope you will bet- ter understand some of the challenges, as well as some leadership strategies that can

NEW LEADER ACTION MEMO Complete the exercise in Leader’s Self-Insight 11.1 to learn about the values you will bring to leading people who are diverse and not like you.

326 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

help make organizations more inclusive and provide a better working environment for all people.

DIVERSITY TODAY The goal for today’s leaders is to recognize that each person can bring value and strengths to the workplace based on his or her own combination of diverse char- acteristics. Organizations establish workforce diversity programs to promote the hiring, inclusion, and career advancement of diverse employees and to ensure that differences are accepted and respected in the workplace.

Definition of Diversity Workforce diversity means a workforce made up of people with different human qualities or who belong to various cultural groups. From the perspective of indivi- duals, diversity refers to all the ways in which people differ, including dimensions such as age, race, marital status, physical ability, income level, and lifestyle.4 Dec- ades ago, most companies defined diversity in terms of a very limited set of dimen- sions, but today’s organizations are embracing a much more inclusive definition that recognizes a spectrum of differences that influence how people approach work, interact with each other, derive satisfaction from their work, and define who they are as people in the workplace.5

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 11.1

Values Balancing

Instructions: For each of the following pairs of values, select the one that is most descriptive of you. Even if both qualities describe you, you must choose one.

1. Analytical Compassionate 2. Collaborative Decisive 3. Competitive Sociable 4. Loyal Ambitious 5. Resourceful Adaptable 6. Sensitive to others Independent 7. Self-reliant Uniting 8. Helpful Persistent 9. Risk-taker Contented

10. Interested Knowledgeable 11. Responsible Encouraging 12. Tactful Driven 13. Forceful Gentle 14. Participating Achievement oriented 15. Action oriented Accepting

Scoring and Interpretation The words above represent two leadership values: “capacity for collaboration” and “personal initiative.” Personal initiative is represented by the first word in the odd-numbered rows and the second word in the even-numbered rows. Capacity

for collaboration is represented by the first word in the even-numbered rows and by the second word in the odd- numbered rows. Add the number of words circled that rep- resent each value and record the number:

Personal Initiative: Capacity for Collaboration:

Capacity for collaboration represents feminine values in our culture, and if you circled more of these items, you may be undervaluing your personal initiative. Personal initiative represents masculine values, and more circled words here may mean you are undervaluing your capacity for collabora- tion. How balanced are your values? How will you lead someone with values very different from yours?

Gender is a trait of diversity. How prevalent in organi- zations are feminine and masculine values? Read the rest of this chapter to learn which values are associated with suc- cessful leadership.

Sources: Based on Donald J. Minnick and R. Duane Ireland, “Inside the New Organization: A Blueprint for Surviving Restructuring, Downsizing, Acquisitions and Outsourcing.” Journal of Business Strategy 26 (2005), pp. 18–25; and A. B. Heilbrun, “Measurement of Masculine and Feminine Sex Role Identities as Independent Dimensions.” Journal of Consulting and Clinical Psychology 44 (1976), pp. 183–190.

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Workforce diversity a workforce made up of people with different human qualities or who belong to various cultural groups

Diversity differences among people in terms of age, ethnicity, gender, race, or other dimensions

Exhibit 11.1 illustrates the difference between the traditional model and a more inclusive model of diversity. The dimensions of diversity shown in the traditional model reflect primarily inborn differences that are immediately observable, such as race, gender, age, and physical ability. However, the inclusive model of diversity includes all of the ways in which people differ, including dimensions of diversity that can be acquired or changed throughout one’s lifetime. These dimensions may have less impact than those in the traditional model but nevertheless affect a person’s self-definition and world view and influence the way the person is viewed by others.

For example, veterans of the wars in Iraq and Afghanistan may have been pro- foundly affected by their military experience and may be perceived differently from other people. An employee living in a public housing project will be perceived differently from one who lives in an affluent part of town. Women with children are perceived dif- ferently in the work environment than those without children. Secondary dimensions such as work style and skill level are particularly relevant in the organizational setting.6

Changing Attitudes toward Diversity Attitudes toward diversity are expanding partly because they have to as leaders respond to significant changes in our society, including demographic changes, shift- ing social values, and globalization.7 In the United States, the minority population is now roughly 100.7 million, making about one in three U.S. residents a minority. Around 32 million people speak Spanish at home, and nearly half of these people say they don’t speak English very well.8 Foreign-born workers make up 16 percent of the U.S. workforce.9 Looking ahead, the number of Hispanic employees will grow the most, increasing 18.6 percent by 2020.10 Women are a growing part of the workforce and are increasingly demanding more fair and equitable treatment. Polls also show that views about social mores and lifestyles are shifting. The per- centage saying society should encourage greater tolerance of people with different lifestyles and backgrounds increased from 29 percent in 1999 to 44 percent in 2013. Support for gay marriage increased to 53 percent from 30 percent in 2004, and a number of states already have laws allowing same-sex marriage.11

The other factor contributing to increased acceptance of diversity is globaliza- tion. Leaders are emphasizing cross-cultural understanding so that people can work

EXHIBIT 11.1 Traditional vs. Inclusive Models of Diversity

Source: Based on Anthony Oshiotse and Richard O’Leary, “Coming Creates an Inclusive Culture to Drive Technology Innovation and Performance,” Global Business and Organizational Excellence 26, no 3 (March/April 2007), pp. 7–21.

328 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

smoothly across borders. “The speed of global business is accelerating diversity,” says Pauline Ning Brody, a Shanghai-born diversity consultant and former director of global sales for Colgate-Palmolive.12 An unprecedented number of foreign-born CEOs now run major companies in the United States, Britain, and several other countries.13 Employees with global experience and cultural sensitivity are in high demand because at least some aspect of almost every business today cuts across national boundaries. As the following example shows, corporations aren’t the only organizations seeking a diverse workforce to cope with the challenges of globalization.

IN THE LEAD Secret Intelligence Service (M16) and Central Intelligence Agency (CIA) James Bond need not apply. Britain’s secret spy agency, M16, has embarked on an intense campaign to recruit women and minorities, not the white males who have long been the face of M16. The agency’s recruiting Web site encourages women, including mothers, to apply and assures them they won’t be used as “seductresses.” Applications from disabled candidates are also welcomed. But the biggest push is for ethnic minorities who speak lan- guages such as Arabic, Persian, Mandarin, Urdu, and the Afghan languages of Dari and Pashto.

For intelligence agencies, diversity is considered mission critical. With terrorism being the key challenge, security agencies in the United States as well as Britain are seeking multi- cultural employees to act as receptionists, linguists, operational agents, technology officers, security guards, and so forth.

For Britain’s M16, the push for more minority applicants is starting to pay off. In 2007, 40 percent of recruits from open recruiting were women and 11 percent were ethnic minor- ities. As Britain moves toward passage of a new “Equality Bill” that will strengthen discrimi- nation laws and allow organizations to give preference to minorities, M16 is getting a head start. As the head of human resources for M16 put it “… [all] agencies have to show that they’re making positive efforts [to diversify], but for us it means much more.”14

Meanwhile, the U.S. CIA is coming under increasing attack for a homogenous culture that has contributed to intelligence failures. “For most of the agency’s existence, the major- ity of its agents and analysts have been a relatively tight group of Caucasian, Protestant, liberal-arts-educated American males,” say Philippe Silberzahn and Milo Jones, who are writ- ing a book about strategic surprises at the CIA. Few CIA agents speak a foreign language or have foreign travel experience. Retired general David H. Petraeus, who resigned as CIA direc- tor in 2012, said “Our key challenge now is to ensure that the CIA’s extraordinarily gifted and dedicated workforce is contributing to its full potential. That means we must, at every level, be as inclusive as possible in our composition and in how we make decisions. Intelligence work is teamwork….”15

The Value of Organizational Diversity There are clear strategic reasons why the CIA and M16 have to be more diverse to reflect the new global reality, but all organizations need diversity of thought to achieve high performance.16 People who differ in various ways, whether it be race, cultural background, gender, physical ability, educational level, lifestyle, age, mari- tal status, or other dimensions, are more likely to have diverse opinions and

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 329

perspectives. This diversity of thought means there is a broader and deeper base of ideas, opinions, and experiences for problem solving, creativity, and innovation.17

According to the results of one study, companies that rate high on creativity and innovation have a higher percentage of women and nonwhite male employees than less innovative companies. Another recent study showed that a team’s collective intelligence increases when there are more women members on the team.18 More- over, companies with more diverse top leadership teams outperform their peers financially. Researchers analyzed return on equity (ROE) and margins for earnings before interest and taxes (EBIT) for 180 corporations in the United States, France, Germany, and the United Kingdom and found that those with a higher percentage of women and foreign nationals performed significantly better than their peers with less diverse top teams.19

At Reckitt Benckiser, a U.K.-based producer of home, health, and personal care products, no nationality dominates the top leadership team. Two executives are Dutch, one is German, two are British, one is South African, two are Italian, and one is from India. Leaders believe the diversity of the company’s workforce is one reason income increased 17 percent annually, on average, from 1999 to 2010. Recently retired CEO Bart Becht said, “It doesn’t matter whether I have a Pakistani, a Chinese person, a Brit, or a Turk, man or woman, sitting in the same room, or whether I have people from sales or something else, so long as I have people with different experiences—because the chance for new ideas is much greater when you have people with different backgrounds.”20

Diversity can help companies meet the needs of diverse customers.21 Culture plays an important role in determining the goods, entertainment, social services, and household products that people use, so organizations are recruiting minority employees who can understand how diverse people live and what they want and need. Fox Sports, for example, achieves a competitive advantage by segmenting its programs to target specific audience groups, such as Hispanics.22 In addition, hav- ing a diverse workforce can build stronger connections with diverse customers. “Our country’s consumer base is so varied,” says Shelley Willingham-Hinton, presi- dent of the National Organization for Diversity in Sales and Marketing. “I can’t think of how a company can succeed without having that kind of diversity with their employees.”23

CHALLENGES MINORITIES FACE Creating an inclusive environment where all individuals feel respected, valued, and able to develop their unique talents is difficult. Most people, including lea- ders, have a natural tendency toward ethnocentrism, which refers to the belief that one’s own culture and subculture are inherently superior to other cultures.24

Moreover, studies by social psychologists suggest that there is a natural tendency among humans to identify themselves with a particular group and to feel antago- nistic and discriminatory toward other groups.25 In high school, the jocks are aligned against the geeks, for instance. In hospital cafeterias, the surgeons sit in one area and the medical residents in another. In newspaper offices, the editorial folks are antagonistic toward the advertising people. The combination of this nat- ural force toward separation, ethnocentric viewpoints, and a standard set of cul- tural assumptions and practices creates a number of challenges for minority employees and leaders.

NEW LEADER ACTION MEMO As a leader, you can hire and promote people from diverse cultures and with diverse hu- man characteristics. You can use organizational diversity to im- prove creativity and decision making, better serve customers, and enhance organizational flexibility.

NEW LEADER ACTION MEMO Take the quiz in Leader’s Self-Insight 11.2 to evaluate your personal degree of unconscious bias and think about ways you can become more diversity-aware.

330 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Ethnocentrism the belief that one’s own culture and subculture are inherently superior to other cultures

Prejudice, Stereotypes, and Discrimination One significant problem in many organizations is prejudice, which is an adverse feeling or opinion formed without regard for the facts. Prejudiced people tend to view those who are different as deficient. An aspect of prejudice is stereotyping. A stereotype is a rigid, exaggerated, irrational, and typically negative belief or image associated with a particular group of people. When a leader and company act out prej- udicial attitudes toward people who are the targets of their prejudice, discrimination occurs.26 Paying a woman less than a man for the same work is gender discrimination. The chapter opening example illustrates racial discrimination. Refusing to hire someone because he or she has a different ethnicity is ethnic discrimination. For example, some years ago, a manager at a major bank encountered resistance from senior leaders because she wanted to hire an Indian applicant who wore a turban.27

Such discrimination is not only unethical but also illegal in the United States. Leaders should be aware that there are a number of federal and state laws that

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 11.2

Unconscious Bias

Instructions: Think about your typical day-to-day behavior and respond to each item below as Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I prefer to be in work teams with people who think like me.

2. I have avoided talking about culture differences with people I met from different cultures because I didn’t want to say the wrong thing.

3. My mind has jumped to a con- clusion without first hearing all sides of a story.

4. The first thing I notice about people is the physical character- istics that make them different from the norm.

5. Before I hire someone, I have a picture in mind of what the per- son should look like.

6. I typically ignore movies, maga- zines, and TV programs that are targeted toward groups and values that are different from mine.

7. When someone makes a bigoted remark or joke, I don’t confront them about it.

8. I prefer to not discuss sensitive topics such as race, age, gender, sexuality, or religion at work.

9. There are people I like but would feel uncomfortable inviting to be with my family or close friends.

10. If I were to seek a mentor, I would want someone culturally similar to myself.

Scoring and Interpretation Give yourself 1 point for each Mostly True answer. Each item above reflects an element of “passive bias,” which can cause people different from you to feel ignored or disrespected by you. Your Score: . As a leader, your typical day-to-day behavior will send signals about your biases and values. Some personal biases are active and well known to yourself and others. Other biases are more subtle. Unconscious bias occurs when a person is not aware of her or his own bias and has no intent to express bias, but others may experience bias. Unconscious bias may be more insidious than active discrimi- nation because the person would exclude diverse experi- ences and people from expression and interaction. The ideal score is zero, but few people reach that ideal. If you scored 3 or less, you are making a good attempt to eliminate your passive and unconscious bias. If you scored 8 or more on your answers above, you should take a careful look at how you think and act toward people different from yourself. You should consider ways to become more culturally sensitive. The sooner you learn to actively include diverse views and people, the better leader you will be.

Source: Based on Lawrence Otis Graham, Proversity: Getting Past Face Values and Finding the Soul of People (New York: John Wiley & Sons, 1997).

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Prejudice an adverse feeling or opinion formed without regard for the facts

Stereotype a rigid, exaggerated, irratio- nal, and typically negative belief or image associated with a particular group of people

Discrimination treating people differently based on prejudicial atti- tudes and stereotypes

prohibit various types of discrimination. Walmart was hit with a huge class-action lawsuit alleging that the retailer discourages the promotion of women to management positions and pays them less than men across all job positions.28 Numerous other com- panies, including Texaco, Coca-Cola, General Motors, Mitsubishi, FedEx Express, eBay, and Abercrombie & Fitch, have been troubled by suits alleging the companies broke laws that prohibit discrimination on the basis of race, gender, age, physical disability, or other diverse characteristics.

Blatant discrimination is not as widespread as in the past, but passive—and sometimes unconscious—bias is still a big problem in the workplace. Consider a report from the National Bureau of Economic Research (titled “Are Greg and Emily More Employable than Lakisha and Jamal?”), which shows that employers sometimes unconsciously discriminate against job applicants based solely on the Afrocentric or African American–sounding names on their resume. In interviews prior to the research, most human resource managers surveyed said they expected only a small gap, and some expected to find a pattern of reverse discrimination. The results showed instead that white-sounding names got 50 percent more call- backs than African American–sounding names, even when skills and experience were equal.29 Similarly, recent research has found that although most men say they have good will toward women in the workplace and want them to succeed, differences in how men and women think and express emotion often lead to unconscious bias. “The male brain has the enviable ability to essentially switch off emotions when desired,” writes Shaunti Feldhahn, author of The Male Factor: The Unwritten Rules, Misperceptions, and Secret Beliefs of Men in the Workplace. When men see someone expressing personal feelings at work, many of them view that person as less business-savvy. For many women, on the other hand, expressing emotion comes naturally and is an authentic part of work as well as personal life.30

Sociologist William Bielby proposes that people have innate biases and, left to their own devices, they will automatically discriminate. Unconscious bias theory suggests that white males, for example, will inevitably slight women and minorities because peo- ple’s decisions are influenced by unconscious prejudice.31 It takes intentional leadership actions to change the status quo. Leaders can establish conditions that limit the degree of unconscious bias that goes into hiring and promotion decisions. Corporations such as BP and Becton Dickinson, for example, use tools to measure unconscious as well as conscious bias in their diversity training programs.32

The Glass Ceiling These innate biases can be partially blamed for constructing the glass ceiling, an invisible barrier that separates women and minorities from top leadership posi- tions. When executives are choosing a successor or someone for a top position, they tend to choose someone who is similar to them—and that has typically meant mostly male and mostly white. Women and minorities can look up through the ceiling, but prevailing attitudes are invisible obstacles to their own advancement. Research has also suggested the existence of “glass walls” that serve as invisible barriers to important lateral movement within the organiza- tion. Glass walls bar experience in areas such as line supervision or general man- agement that would enable women and minorities to advance to senior-level positions.33

Although a few women and minorities have moved into highly visible top leader- ship positions, such as Ursula Burns at Xerox, Kenneth Chenault at American Express,

NEW LEADER ACTION MEMO As a leader, you can appreciate differences among people but shed stereotypes and prejudicial attitudes. You can avoid dis- crimination and view differ- ences among people as positive or neutral.

332 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Glass ceiling an invisible barrier that separates women and mi- norities from top leadership positions

Ellen Kullman at DuPont, and Indra Nooyi at PepsiCo, most women and minorities are still clustered at the bottom of the organizational hierarchy. Women have made sig- nificant strides in recent years, but they still represent only a small percentage of top executives and board members in America’s 500 largest companies.34 A global study by McKinsey & Company found that in 2011 women held 15 percent of the seats on corporate boards and 14 percent of those on executive committees in the United States. Of the countries surveyed, Norway had the largest percentage of women on corporate boards and executive committees (35 percent and 15 percent, respectively), and Japan the lowest (2 percent and 1 percent).35 In 2009, Ursula Burns made history as the first African American woman to rise to the top of a Fortune 500 company, but both male and female African Americans and Hispanics continue to hold only a small percentage of all management positions in the United States.36

Leaders in other countries are struggling with similar diversity issues. A report on executive talent in the United Kingdom, for example, indicates that although employees on the front lines “reflect the rich diversity of 21st century Britain,” the executive suite is overwhelmingly “white, male, able-bodied, and of a certain age.”37 Criticism of gender inequality in Germany is growing, as most European Union countries have narrowed the wage gap between men and women, but pay disparity in Germany is actually increasing, according to figures from Germany’s Federal Statistical Office.38 Japanese companies face mounting criticism about the scarcity of women in management positions. In Japan, women make up 41 percent of the workforce but occupy less than 3 percent of high-level management positions.39 In India, the situation is also dismal. India’s recent economic growth has prompted a closer look at its workforce. Women represent only 24 percent of the workforce and make up about 5 percent of senior-level managers. Moreover, reports suggest that women who enter the business world in India often face intimi- dating and threatening work environments.40

In the United States, some women get off the fast track before they ever encounter the glass ceiling, which has been referred to as the opt-out trend.41

In a survey of nearly 2,500 women and 653 men, 37 percent of highly quali- fied women report that they have voluntarily left the workforce at some point in their careers, compared to only 24 percent of similarly qualified men.42

Women leaders sometimes feel that the cost of climbing the corporate ladder is too high. In her controversial book Lean In, Facebook chief operating offi- cer Sheryl Sandberg says many women fall behind in their careers because of their own bad choices, as described further in the Leader’s Bookshelf. However, evidence shows that successful career women frequently have to give up personal time, outside friendships, or hobbies because they still do most of the child care and housework in addition to their business responsibilities. Exhibit 11.2 shows the discrepancy between high-achieving men and women in terms of the time they devote to domes- tic duties, based on one survey.

Although some women voluntarily leave the fast track, there are many who gen- uinely want to move up the corporate ladder but find their paths blocked. Fifty-five percent of executive women surveyed by Catalyst said they aspire to senior leadership levels.43 In addition, a survey of 103 women voluntarily leaving executive jobs in Fortune 1000 companies found that corporate culture was cited as the number-one reason for leaving.44 The greatest disadvantages for women leaders stem largely from prejudicial attitudes and a heavily male-oriented corporate culture.45 Some lead- ing organizations, such as MetLife, are finding ways to shatter the glass ceiling so that women have full opportunities to grow, contribute, and advance.

NEW LEADER ACTION MEMO As a leader, you can fight ethnocentric attitudes. You can create an environment in which people value diverse ways of thinking, dressing, or behaving, and you can help break down prejudice, stereo- types, and the glass ceiling.

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 333

IN THE LEAD MetLife Leaders at MetLife consider women to be an integral part of the company’s global vision and strategy, but they realize that women are underrepresented at the top of the organiza- tion. They created a leadership development program called Leadership Circles specifically to advance and support women with high potential.

The program teaches women to apply leadership concepts such as creating an inspiring vision, setting goals, aligning action plans, and developing a team to their own personal devel- opment as leaders. Participants belong to a number of “circles,” which are groups of 10 to 15

LEADER’S BOOKSHELF Lean In: Women, Work, and the Will to Lead

by Sheryl Sandberg

Lean In, by Facebook COO Sheryl Sandberg, is one of the most controver- sial books to come out in years. Sandberg acknowledges that women face tremendous barriers in the work- place, but she argues that women also need to break down the barriers within themselves and find their own asser- tiveness. She recounts workplace and social science research proving that bias and institutional barriers exist, but she also presents evidence showing that women hold themselves back. One study, for instance, found that when girls are reminded of their gender prior to taking a test, even by simply checking an “M” or an “F” at the top of the page, they don’t perform as well. Gender stereotypes, Sandberg says, are so powerfully ingrained in women that they continue to perpetu- ate them subconsciously.

HOW WOMEN HOLD THEMSELVES BACK “By lacking self-confidence, by not rais- ing our hands, and by pulling back when we should be leaning in,” Sand- berg writes, women are largely to blame for the fact that “men still run the world.” Here are a few of the career sins Sandberg says women commit:

• They Let Insecurity Hold Them Back. Self-confidence is at the heart of being a leader, taking risks, and becoming powerful. It might be

easier for men, Sandberg says, but women can overcome the insecurity that limits them. She describes many times in her career when she felt deeply unsure of herself but pushed through. “I still face situations that I fear are beyond my capabilities,” she writes. “And I still sometimes find myself spoken over and discounted while men sitting next to me are not. But now I know how to take a deep breath and keep my hand up.”

• They Don’t Take Responsibility for Their Success. Societal norms and stereotypes of how women “should” act in the workplace have been around for decades, but they will change only if women take respon- sibility for redefining expectations. Too many women, Sandberg says, get caught in the “tiara syndrome,” expecting to be rewarded for good work rather than seizing opportu- nities and asking for what they deserve. Women have to assertively “sit at the table” rather than being observers in their own careers.

• They Seek Mentors. Having a men- tor can be a powerful benefit to any- one’s career, but people should get mentors when they do great work and attract the attention of higher executives who want to help them. “Searching for a mentor has become the professional equivalent of wait- ing for Prince Charming,” Sandberg

says. Rather than expecting to get a mentor in order to excel, the logic women should use is, “excel and you will get a mentor.”

• They Leave before They Leave. Women tend to make incremental decisions based on future plans that chip away at their career options. “A law associate might decide not to shoot for partner because someday she hopes to have a family,” she writes. “A sales representative might take a smaller territory or not apply for a management role. Often without even realizing it, the woman stops reaching for new opportunities” because of the long-term future impact. Sandberg pays tribute to women who sideline careers for chil- dren, but she emphasizes, “The time to scale back is when a break is needed or a child arrives—not before, and cer- tainly not years in advance.”

WHAT’S THE ANSWER? “I believe that female leaders are key to the solution,” writes Sandberg. She says things will get better for everyone when there are more women in high-level posi- tions who can change organizational cul- tures from within. For that to happen, women have to overcome the inner bar- riers that are holding them back.

Source: Lean In: Women, Work, and the Will to Lead, by Sheryl Sandberg, is published by Alfred A. Knopf.

hu tte rs to ck .c om

334 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

members that support their learning and growth in various ways. Each group had a dedicated coach that also works with each member individually. MetLife knows that one-on-one coaching is essential for moving people from passive to active leadership development.

By gaining clarity about what they want and how they plan to achieve it, participants enhance their performance in their current jobs and gain skills for moving into senior leader- ship roles in the future. One financial advisor increased production by 45 percent as a result of the program and became a part of the MetLife Leaders’ Conference, which is reserved for top- performing advisors. An operations manager improved efficiency in a key area from 48 per- cent to 74 percent, and a marketing manager increased the ROI for the money she manages, resulting in an additional $829,000 in revenue for the firm. Moreover, several of the program participants have gone on to assume broader leadership roles within the company and serve as mentors for new program participants. The goal is to have a self-sustaining model of women helping women to move into and succeed in senior leadership roles.46

Partly because of the Leadership Circles Program, Working Mother magazine named MetLife one of its 100 best companies for women to work. “Companies need to support these women, or they may go somewhere else,” said one program partici- pant.47 Many organizations have found that high-performing women leave the company when they fail to receive opportunities for growth and advancement. Companies need women leaders more than ever in today’s environment because of the strengths they bring to leadership, as we will discuss in the following section. Organizations such as McKinsey & Company, Bain & Company, and Boston Consulting Group have imple- mented initiatives including mentoring, professional development programs, and flexible work options to lure back women who left as part of the opt-out trend.48

EXHIBIT 11.2 Primary Domestic Responsibilities of High-Achieving Men and Women

Source: National Parenting Association, as reported in Sylvia Ann Hewlett, “Executive Women and the Myth of Having It All,” Harvard Business Review (April 2002), pp. 66–73.

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 335

WAYS WOMEN LEAD Studies show that organizations with more women leaders have up to 65 percent higher financial results than those without female representation. There is increas- ing evidence that companies where women make up a significant percentage of board members and senior management perform better than those with only a few women in high-level positions.49 There has been growing interest in what leadership approach women use that contributes to these positive outcomes. Women often use a style of leadership that is different from men’s and that is highly effective in today’s turbulent, culturally diverse environment.50

There is some evidence that men may become less influential in the U.S. work- force, with women becoming dominant players, because women’s approach is more attuned to the needs and values of a multicultural environment. For example, there’s a stunning gender reversal in U.S. education, with girls taking over almost every leadership role from kindergarten to graduate school.51 Hanna Rosin, jour- nalist and author of The End of Men, suggests that women are more adaptable

Consider Are Men Failing?

Here are some recent observations in the United States that suggest men are falling behind in today’s world:

• The most recent recession hit traditionally male-dominated industries the hardest. In 1954, 96 percent of men between the ages 25 and 54 worked. In 2012, that number was down to 80 percent.

• Men still dominate the top of organizational hierarchies, but women are gaining in other areas. • Of the 15 fastest-growing professions, 12 of them are dominated by women. • Although men still earn more, men’s incomes have generally declined in the past decade while

women’s have grown. Women in their 20s earn more money than men in the same age group. • In 2011, 57 percent of bachelor’s degrees, 60 percent of master’s degrees, 51 percent of Ph.D.

degrees, 48 percent of law degrees, and 45 percent of MBAs went to women. Among 25- to 29-year-olds, 32 percent of women have college degrees, compared to 27 percent of men.

• Both Republican and Democratic political consultants say that, all else being equal, women candidates are now more desirable than men.

Overall, women’s participation in both the labor force and civic affairs has steadily increased since the mid-1950s, whereas men’s participation has slowly but steadily declined.

When there is a major upheaval in society, the people who were at the top of the old order of things (men) tend to cling to the old ways, whereas the people who were on the bottom (women) experience a burst of energy and take advantage of new opportunities. Are men failing? Or is this just a course correction that will have men and women making equal contributions to society?

Sources: Based on Hanna Rosin, The End of Men—and the Rise of Women (New York: Riverhead/Penguin 2012); David Brooks, “Why Men Fail,” The New York Times (September 10, 2012), http://www.nytimes.com/2012/09/11 /opinion/brooks-why-men-fail.html?_r=0 (accessed May 10, 2013); U.S Department of Education statistics reported in David Wessel, “The Positive Economics of ‘Leaning in,’ ” The Wall Street Journal (April 4, 2013), p. A4; Michelle Conlin, “The New Gender Gap,” BusinessWeek (May 26, 2003), pp. 74–82; and Molly Ball, “A Woman’s Edge: Why Both Political Parties Now Think That Voters Prefer Female Candidates,” The Atlantic (May 2013), pp. 15–17.

336 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

and easier to educate.52 Empirical studies do show that women students are more achievement oriented, less likely to skip classes, spend more time studying, and typ- ically earn higher grades.53 This chapter’s Consider This box takes a closer look at various ways in which women appear to be outpacing men in the United States.

Women as Leaders According to James Gabarino, an author and professor of human development at Cornell University, women are “better able to deliver in terms of what modern soci- ety requires of people—paying attention, abiding by rules, being verbally compe- tent, and dealing with interpersonal relationships in offices.”54 His observation is supported by the fact that female leaders are typically rated higher by subordinates on interpersonal skills as well as on factors such as task behavior, communication, ability to motivate others, and goal accomplishment.55

As illustrated in Exhibit 11.3, one survey of followers rated women leaders sig- nificantly higher than men on several characteristics that are crucial for developing fast, flexible, adaptive organizations. Female leaders were rated as having more ideal- ized influence, providing more inspirational motivation, being more individually con- siderate, and offering more intellectual stimulation.56 Idealized influence means that followers identify with and want to emulate the leader; the leader is trusted and respected, maintains high standards, and is considered to have power because of who she is rather than what position she holds. Inspirational motivation is derived from the leader who appeals emotionally and symbolically to employees’ desire to do a good job and help achieve organizational goals. Individual consideration means each follower is treated as an individual but all are treated equitably; individ- ual needs are recognized, and assignments are delegated to followers to provide learn- ing opportunities. One of the strengths of Cynthia Carroll, the first female leader of

EXHIBIT 11.3 Comparison of Male and Female Leaders by Their Subordinates

Source: Based on Bernard M. Bass and Bruce J. Avolio, “Shatter the Glass Ceiling: Women May Make Better Managers,” Human Resource Management 33, no. 4 (Winter 1994), pp. 549–560.

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 337

global mining company Anglo American, for example, is “getting the most out of each individual.” Carroll is also bringing a new mindset to Anglo American that is helping the company become more global in its approach, reflecting intellectual stim- ulation.57 Intellectual stimulation means questioning current methods and challenging employees to think in new ways. In addition to these qualities, women leaders were judged by subordinates in the survey as more effective and satisfying to work for and were considered able to generate extra levels of effort from employees.

Is Leader Style Gender-Driven? Several researchers have examined the question of whether women lead differently than men. Although they are broad generalizations, social science research suggests that predominantly communal qualities, such as compassion and kindness, are more associated with women in general and predominantly agentic qualities, such as assertiveness and competitiveness, are more associated with men.58 Refer to Leader’s Self-Insight 11.1 earlier in the chapter to see if your values are more communal or agentic.

Leadership traits traditionally associated with white, American-born males include aggressiveness or assertiveness, rational analysis, and a “take charge” attitude. Male leaders tend to be competitive and individualistic and prefer working in vertical hierar- chies. They rely on formal authority and position in their dealings with subordinates.

Some women also reflect these characteristics, of course, but research has found that, in general, women prefer less competitive environments than men, tend to be more collaborative, and are more concerned with relationship building, inclusive- ness, participation, and caring.59 Female leaders such as Deborah Kent, the first woman to head a vehicle assembly plant for Ford Motor, or Terry Kelly, CEO of W. L. Gore & Associates, are often more willing to share power and information, to encourage employee development, and to strive to enhance others’ feelings of self-worth. “It does no good have a diverse workforce if you don’t listen to their opinions and thoughts,” says Kent. “I treat people the way I want to be treated.”60

Professor and author Judy B. Rosener has called women’s approach to leadership interactive leadership.61 The leader favors a consensual and collaborative process, and influence derives from relationships rather than position power and authority. Some psychologists have suggested that women may be more relationship oriented than men because of different psychological needs stemming from early experiences. This difference between the relationship orientations of men and women has sometimes been used to suggest that women cannot lead effectively because they fail to exercise power. However, whereas male leaders may associate effective leadership with a top- down command-and-control process, women’s interactive leadership seems appropri- ate for the future of diversity, globalization, and learning organizations. Cindy Szadokierski applies interactive leadership to handle the complex and demanding job of managing operations for United Airlines in Chicago.

IN THE LEAD Cindy Szadokierski, United Airlines Twenty-five years ago, Cindy Szadokierski quit her job teaching high school French and went to work as a reservations agent for United Airlines. Today, she is vice president in charge of operations for United’s largest hub at O’Hare International Airport.

Diversity: the art of thinking independently

together. Malcolm Forbes

(1919–1990), American businessman and publisher of Forbes

magazine

NEW LEADER ACTION MEMO As a leader, you can choose to employ an interactive, collabo- rative leadership style. You can develop personal relationships with your followers and make everyone feel like an important part of things.

338 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Interactive leadership a leadership style in which people develop personal relationships with followers, share power and informa- tion, empower employees, and strive to enhance others’ feelings of self-worth

After joining the company, Szadokierski served in positions of increasing responsibil- ity, including being general manager of United’s hub at Washington’s Dulles International Airport. From the beginning of her career with United, Szadokierski wanted to be in operations because she liked the idea of bridging the gap between what goes on in the field and what happens at headquarters. At O’Hare, where she oversees 4,000 employees and 600 flights a day, her favorite times are the weekly afternoon walkabouts on the O’Hare ramp and the weekly morning strolls through the terminal. Why? Because they give her a chance to connect with employees and customers. Pete McDonald, chief oper- ating officer of United’s parent, UAL Corporation, says there were serious operations pro- blems at O’Hare, so they put “the most communicative person” in the job. “She’s everywhere. She talks to everybody,” said Don Wolfel, president of United’s mechanics union at O’Hare.

Szadokierski’s approach to leadership is more collaborative than command-and-control. In addition to learning from employees and customers, Szadokierski emphasizes regular meetings with her leadership team to talk about what’s going right, what’s going wrong, and how to collaboratively fix any problems.62

Although the values associated with interactive leadership, such as inclusion, relationship building, and caring, are generally considered “feminine” values, inter- active leadership is not gender-specific. These values are becoming increasingly valuable for both male and female leaders.63 Any leader can learn to adopt a more inclusive style by paying attention to nonverbal behavior and developing skills such as listening, empathy, cooperation, and collaboration.

GLOBAL DIVERSITY One of the most rapidly increasing sources of diversity is globalization, which means that leaders are confronting diversity issues across a broader stage than ever before. For leaders interacting with people from other cultures, even something as seemingly simple as a handshake can be confusing, as illustrated in Exhibit 11.4. If the proper way to shake hands can vary so widely, no wonder managers have trouble knowing how to act when doing business with people from or in other countries.

Leaders can get a handle on the challenges of global diversity by understanding the sociocultural environment and by developing a higher cultural intelligence quo- tient (CQ) to know how to behave appropriately.

The Sociocultural Environment Social and cultural differences may provide more potential for difficulties and con- flicts than any other source. For instance, after hundreds of mostly Somali Muslim employees walked out to protest not being allowed extra break times to pray during Ramadan, leaders at a JBS Swift & Company meatpacking plant in Omaha, Nebraska, altered their policies so the workers could pray at the appropriate times. That, however, led to protests by non-Muslim workers, who alleged “prefer- ential treatment,” causing leaders to reconsider allowing extra breaks for prayer. The tensions and conflicts led to a near-riot, and Swift’s leaders are still trying to resolve the issues that have arisen between the different groups.64

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 339

Cultural factors have also created problems for leaders in some U.S. corpora- tions trying to transfer their diversity policies and practices to European divisions. Policies designed to address diversity issues in the United States don’t take into consideration the complex social and cultural systems in Europe. In Britain, for example, class distinctions are as big an aspect of diversity as race, gender, or dis- ability.65 Even the meaning of the term diversity can present problems. In many European languages, the closest word implies separation rather than the inclusion sought by U.S. diversity programs.66 Foreign firms doing business in the United States face similar challenges understanding and dealing with diversity issues. C. R. “Dick” Shoemate, chairman and CEO of Bestfoods, says, “It takes a special kind of leadership to deal with the differences in a multicountry, multicultural orga- nization….” Bestfoods uses cross-border assignments and extensive individual coaching to train people to lead a multicultural workforce.67

Social Value Systems Research done by Geert Hofstede on IBM employees in 40 countries discovered that mindset and cultural values on issues such as individualism versus collectivism strongly influence organizational and employee relationships and vary widely among cultures.68 Exhibit 11.5 shows examples of how countries rate on four sig- nificant dimensions.

• Power distance. High power distance means people accept inequality in power among institutions, organizations, and individuals. Low power distance means people expect equality in power. Countries that value high power distance are Malaysia, the Philippines, and Panama. Countries that value low power dis- tance include Denmark, Austria, and Israel.

• Uncertainty avoidance. High uncertainty avoidance means that members of a society feel uncomfortable with uncertainty and ambiguity and thus support beliefs and behaviors that promise certainty and conformity. Low uncertainty avoidance means that people have a high tolerance for the unstructured, the unclear, and the unpredictable. High uncertainty avoidance cultures include

NEW LEADER ACTION MEMO Social value differences can significantly affect leadership, working relationships, and organizational functioning. Answer the questions in Leader’s Self-Insight 11.3 to better un- derstand the social values of your classmates or coworkers.

EXHIBIT 11.4 How Do You Shake Hands?

Culture Preferred Style of Handshake

Asian Gentle (shaking hands is unfamiliar and uncomfortable for some Asians; the exception is the Korean, who usually prefers a firm handshake)

British Soft French Light and quick; repeated on arrival and departure; not offered to

superiors German Brusque and firm; repeated on arrival and departure Latin American Moderate grasp; repeated frequently Middle Eastern Gentle; repeated frequently North American Firm

Power distance how much people accept equality in power; high power distance reflects an acceptance of power in- equality among institutions, organizations, and indivi- duals; low power distance means people expect equality in power

Uncertainty avoidance the degree to which mem- bers of a society feel uncomfortable with uncer- tainty and ambiguity and thus support beliefs and behaviors that promise cer- tainty and conformity

340 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 11.3

Social Values

Instructions: Different social groups (work colleagues, fam- ily, professional groups, and national, religious, and cultural groups) are all around us. Focus on the group of individuals whom you consider to be your colleagues (e.g., team mem- bers, coworkers, classmates). Respond to each of the follow- ing statements and indicate its level of importance to your colleague group on the scale of (1) Not at all important to (5) Very important.

How Important Is It: Not at All Important

Very Important

1. To compromise one’s wishes to act together with your colleagues? 1 2 3 4 5

2. To be loyal to your colleagues? 1 2 3 4 5

3. To follow norms estab- lished by your colleagues? 1 2 3 4 5

4. To maintain a stable environment rather than “rock the boat”? 1 2 3 4 5

5. To not break the rules? 1 2 3 4 5 6. To be a specialist or

professional rather than a manager? 1 2 3 4 5

7. To have an opportunity for high earnings? 1 2 3 4 5

8. To have an opportunity for advancement to higher- level jobs? 1 2 3 4 5

9. To work with people who cooperate well with one another? 1 2 3 4 5

10. To have a good working relationship with your leader? 1 2 3 4 5

11. To have a leader that gives detailed instructions? 1 2 3 4 5

12. To avoid disagreement with a leader? 1 2 3 4 5

Scoring and Interpretation There are four subscale scores that measure the four social values described by Hofstede. For the dimension of individ- ualism–collectivism, compute your average score based on

responses to questions 1, 2, and 3. For the dimension of uncertainty avoidance, compute your average score based on responses to questions 4, 5, and 6. For the dimension of masculinity–femininity, reverse score your responses to questions 9 and 10 (5 1, 4 2, 2 4, and 1 5) and then compute your average score for questions 7, 8, 9, and 10. For the dimension of power distance, compute the aver- age score for questions 11 and 12.

My average social value scores are: Individualism–collectivism (I–C) . Uncertainty avoidance (UA) . Masculinity–femininity (M–F) . Power distance (PD) .

An average score of 4 or above on the I–C scale means that collectivism is a social value in your colleague group, and a score of 2 or below means that the value of individu- alism dominates. A score of 4 or above on the UA scale means that your group values the absence of ambiguity and uncertainty (high uncertainty avoidance), and a score of 2 or below means that uncertainty and unpredictability are preferred. A score of 4 or above on the M–F scale means that masculinity is a social value in your colleague group, and a score of 2 or below means that the value of femininity dominates. A score of 4 or above on the PD scale means that high power distance, or hierarchical differences, is a social value in your colleague group, and a score of 2 or below means that the value of low power distance, or equal- ity, dominates.

Compare your four scores to one another to under- stand your perception of the different values. On which of the four values would you like to score higher? Lower? Ana- lyze the specific questions on which you scored higher or lower to analyze the pattern of your group’s social values. Show your scores to a student from another country and explain what they mean. How do your social values differ from the social values of the international student? How do these social values differ across the nationalities represented in your class?

Sources: Adapted from Geert Hofstede, Culture’s Consequences (London: Sage Publications, 1984); and D. Matsumoto, M. D. Weissman, K. Preston, B. R. Brown, and C. Kupperbausch, “Context-Specific Measurement of Individualism–Collectivism on the Individual Level: The Individualism– Collectivism Interpersonal Assessment Inventory,” Journal of Cross-Cultural Psychology 28, no. 6 (1997), pp. 743–767.

| D re am

st im e. co m

341 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Greece, Portugal, and Uruguay. Singapore and Jamaica are two countries with low uncertainty avoidance values.

• Individualism and collectivism. Individualism reflects a value for a loosely knit social framework in which individuals are expected to take care of themselves. Collectivism is a preference for a tightly knit social framework in which people look out for one another and organizations protect their members’ interests. Countries with individualist values include the United States, Great Britain, and Canada. Countries with collectivist values are Guatemala, Ecuador, and Panama.

• Masculinity and femininity. Masculinity reflects a preference for achievement, heroism, assertiveness, work centrality, and material success. Femininity reflects the values of relationships, cooperation, group decision making, and quality of life. Japan, Austria, and Mexico are countries with strong masculine values. Countries with strong feminine values include Sweden, Norway, Denmark, and the former Yugoslavia. Both men and women subscribe to the dominant value in masculine or feminine cultures.

Terry Neill, a managing partner at a London-based change management prac- tice, uses Hofstede’s findings in his work with companies. Based on his experiences with global companies such as Unilever PLC, Shell Oil, and BP, Neill points out that the Dutch, Irish, Americans, and British are generally quite comfortable with open argument. However, Japanese and other Asian employees often feel uneasy or even threatened by such directness.69 In many Asian countries, leaders perceive the organization as a large family and emphasize cooperation through networks of personal relationships. In contrast, leaders in Germany and other central European countries typically strive to run their organizations as impersonal well-oiled machines.70 How leaders handle these and other cultural differences can have tre- mendous impact on the satisfaction and effectiveness of diverse employees.

EXHIBIT 11.5 Rank Orderings of 10 Countries along Four Dimensions of National Value System

Country Powera Uncertaintyb Individualismc Masculinityd

Australia 7 7 2 5 Costa Rica 8 2 (tie) 10 9 France 3 2 (tie) 4 7 India 2 9 6 6 Japan 5 1 7 1 Mexico 1 4 8 2 Sweden 10 10 3 10 Thailand 4 6 9 8 United States 6 8 1 4

a1 highest power distance; 10 lowest power distance b1 highest uncertainty avoidance; 10 lowest uncertainty avoidance c1 highest individualism; 10 highest collectivism d1 highest masculinity; 10 highest femininity

Sources: From Dorothy Marcic, Organizational Behavior and Cases, 4th ed. (St. Paul, MN: West, 1995). Based on Geert Hofstede, Culture’s Consequences (London: Sage Publications, 1984); and Cultures and Organizations: Software of the Mind (New York: McGraw-Hill, 1991).

342 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Individualism a value for a loosely knit social framework in which individuals are expected to take care of themselves

Collectivism a preference for a tightly knit social framework in which people look out for one an- other and organizations protect their members’ interests

Masculinity a preference for achieve- ment, heroism, assertiveness, work centrality, and material success

Femininity a preference for relation- ships, cooperation, group decision making, and quality of life

Developing Cultural Intelligence Although understanding the sociocultural environment and social value differences is crucial, a person cannot expect to know everything necessary to be prepared for every conceivable situation. Thus, in a multicultural environment, leaders will be most suc- cessful if they are culturally flexible and able to easily adapt to new situations and ways of doing things. In other words, they need a high CQ. Cultural intelligence refers to a person’s ability to use reasoning and observation skills to interpret unfamiliar ges- tures and situations and devise appropriate behavioral responses.71 Developing a high CQ enables a person to interpret unfamiliar situations and adapt quickly. Rather than a list of global “dos and don’ts,” CQ enables a person to ferret out clues to a culture’s shared understandings and respond to new situations in culturally appropriate ways.

Cultural intelligence includes three components that work together: cognitive, emo- tional, and physical.72 The cognitive component involves a person’s observational and learning skills and the ability to pick up on clues to understanding. The emotional aspect concerns one’s self-confidence and self-motivation. A leader has to believe in his or her ability to understand and assimilate into a different culture. Difficulties and setbacks are triggers to work harder, not a cause to give up. The third component, the physical, refers to a person’s ability to shift his or her speech patterns, expressions, and body language to be in tune with people from a different culture. Most people aren’t equally strong in all three areas, but maximizing CQ requires that they draw upon all three facets.

Developing a high CQ requires that a leader be open and receptive to new ideas and approaches. Working in a different country is one of the best ways people can stretch beyond their comfort zone and develop a broader, more global perspective. One study found that people who adapt to global management most easily are those who have grown up learning how to understand, empathize, and work with others who are different from themselves. For example, Singaporeans consistently hear English and Chinese spoken side by side. The Dutch have to learn English, German, and French, as well as Dutch, to interact and trade with their economically dominant neighbors. English Canadians must not only be well versed in American culture and politics, but they also have to consider the views and ideas of French Canadians, who, in turn, must learn to think like North Americans, members of a global French community, Canadians, and Quebecois.73 People who have grown up without this kind of language and cultural diversity, which includes most leaders in the United States, typically have more difficulties with foreign assignments, but will- ing managers from any country can learn to open their minds and appreciate other viewpoints.

Leadership Implications A study of executives in five countries found that although the globalization of business seems to be leading to a convergence of managerial values and attitudes, executives in different countries differ significantly in some areas, which can create problems for leadership.74 To lead effectively in a diverse global environment, leaders should be aware of cultural and subcultural differences. Chapter 3 examined contingency theories of leadership that explain the relationship between leader style and a given situation. It is important for leaders to recognize that culture affects both style and the leadership situation. For example, in cultures with high uncertainty avoidance, a leadership situa- tion with high task structure as described in Chapter 3 is favorable, but those in low uncertainty avoidance cultures prefer less-structured work situations. Research into how the contingency models apply to cross-cultural situations is sparse. However, all

You can evalu- ate your cogni- tive, emotional, and physical CQ with the online CengageNOW questionnaire.

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 343

Cultural intelligence the ability to use reasoning and observation to interpret unfamiliar situations and devise appropriate behav- ioral responses

leaders need to be aware of the impact that culture may have and consider cultural values in their dealings with employees and colleagues.

How leader behavior is perceived differs from culture to culture. For example, there is tremendous variation across countries in what people expect leaders to do and be. For example, should leaders be experts who provide precise answers to their employees’ questions or should they instead be facilitators who help employees dis- cover solutions rather than providing them with direct answers? The answer varies from country to country, and problems can occur when unaware leaders from one culture interact with employees from another. For example, most leaders in the United States think merely providing answers limits subordinates’ initiative and crea- tivity. In France, though, leaders believe they should give exact answers in order to maintain their credibility as experts.75 If a leader from the United States working in France tells an employee she doesn’t know the answer and suggests the employee consult with someone else about the problem, the employee might conclude that the U.S. leader is incompetent. Similarly, employees in the United States working for a French boss might consider the boss egotistical when he continually provides specific answers rather than offering suggestions for how to find solutions to a problem. Exhibit 11.6 gives some examples of how the leader’s role varies across countries based on whether leaders are expected to provide answers to employee questions.

Other behavioral misunderstanding can also trip up leaders. An American man- ager nearly blew a deal with a Korean company because he complained directly to higher-level executives when he had difficulty getting the information he needed from his Korean counterparts. In the United States, such an approach would be acceptable, but in Korea, it was seen as a sign of disrespect. The lower-level Korean

NEW LEADER ACTION MEMO As a leader, you can develop cultural intelligence. You can study other languages and cultures and form relationships with people from different countries. You can learn to be sensitive to differences in social value systems, and find creative ways to address delicate di- versity issues.

EXHIBIT 11.6 Are Leaders Expected to Be Experts?

Source: André Laurent, “The Cultural Diversity of Western Conceptions of Management,” International Studies of Management and Organization 13, no. 1–2 (Spring-Summer, 1983), pp. 75–96. Adapted from ADLER, International Dimensions of Organizational Behavior, 5E.

344 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

managers were horrified and embarrassed, the upper-level managers were offended, and the crisis was resolved only when top executives from the United States made a trip to Korea to apologize and show respect.76

BECOMING AN INCLUSIVE LEADER One goal for today’s global organizations is to ensure that all people—women, eth- nic minorities, younger people, gays and lesbians, the disabled, older people, racial minorities, as well as white males—are given equal opportunities and treated with fairness and respect.77

Leaders vary in their sensitivity and openness to other cultures, attitudes, values, and ways of doing things. Exhibit 11.7 shows a model of five stages of indi- vidual diversity awareness and actions.78 The continuum ranges from a defensive, ethnocentric attitude, in which leaders meet the minimum legal requirements regarding affirmative action and sexual harassment, to a complete understanding and acceptance of people’s differences, in which leaders value diversity as an inher- ent part of the organizational culture.

EXHIBIT 11.7 Stages of Personal Diversity Awareness

Source: Based on M. Bennett, “A Developmental Approach to Training for Intercultural Sensitivity,” International Journal of Intercultural Relations 10 (1986), pp. 179–196.

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 345

People at stage 1 see differences as a threat against their own comfortable worldview and frequently use negative stereotyping or express prejudicial attitudes. Leaders at this stage of diversity awareness consider themselves successful if their legal record is good. They may view women and minorities as a “problem” that must be dealt with. Typi- cally, these leaders promote a few minorities to executive-level jobs to meet legal require- ments. At stage 2, people attempt to minimize differences and focus on the similarities among all people. This is the stage where unconscious and subtle bias is most evident because people have moved beyond openly prejudicial attitudes. Leaders don’t ade- quately recognize or respond to the challenges minorities and women face in the organi- zation. When an individual moves to stage 3 of diversity awareness, he or she accepts cultural differences and recognizes the validity of other ways of thinking and doing things. Here, leaders become proactive and acknowledge that addressing issues of gen- der, race, disability, and so forth is important not just for the minority employees but also for the health of the organization. They recognize that women and minorities can bring needed insight into developing and marketing products for new customers, so they look for ways to attract and retain high-quality minority employees. In stage 3 orga- nizations, more women and minorities make it to high-level positions, and leaders begin providing diversity training to all employees.

When people reach stage 4, they are able to empathize with people who are differ- ent from themselves and can comfortably shift from one cultural perspective to another. Leaders at this stage make a strong commitment to broad equality and community and rectify the undervaluation and underutilization of women and minorities. Leaders make a genuine attempt to develop policies and practices that are inclusive rather than exclu- sive. Consider how leaders at Denny’s Restaurants improved diversity awareness to transform the company from an icon of racism to a paragon of diversity.

IN THE LEAD Rachelle Hood, Denny’s Restaurants It was a spring morning in 1993 when six African American Secret Service agents sat waiting for their food at Denny’s for more than an hour while their white colleagues ate. Their meals arrived just before they had to leave. The highly publicized incident led to other revelations of discrimination against African American customers and employees—and to a series of racial discrimination lawsuits. Thirteen years later, a Denny’s executive received the “We Share the Dream Award” at the 18th annual Dr. Martin Luther King Jr. Awards Dinner. How did Denny’s go from worst to first? It comes down to top leader commitment and some serious training to improve diversity awareness and behavior.

After settling the discrimination lawsuits in 1994, Denny’s hired Rachelle Hood as its first chief diversity officer. Hood got the company to hire more than 100 diversity trainers and implemented training for employees and leaders at every level. Every single person at Denny’s—not just managers, dishwashers, and servers but also media planners and leased security guards—attends diversity training with specific guidelines on how to apply diversity understanding and sensitivity to working in the restaurant business. In the “We Can” training program, for example, employees learn a three-step model: (1) pre- vention, such as how to behave in order to reduce the possibility of a guest or fellow employee feeling that he or she has been discriminated against; (2) intervention, which teaches people to “acknowledge, apologize, and act” when something goes wrong; and (3) managing escalation, in which employees learn how to genuinely listen, show empa- thy, and reduce the anger and frustration level. Denny’s spends several million dollars a

346 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

year on building awareness, and its diversity training system is one of the most compre- hensive in the industry.

Hood cemented diversity awareness by working with leaders to increase supplier diver- sity, developing marketing campaigns targeting minority customers, and tying managers’ bonus pay to meeting diversity goals. In 1993, only one of the chain’s franchises was minority-owned, the company had no minority suppliers, and the board was made up pri- marily of white males. Today, however, things are very different:

• More than 40 percent of Denny’s franchises are owned by minorities. • During a recent 10-year period, Denny’s contracted nearly $1 billion for goods and ser-

vices with minority suppliers, with African Americans accounting for 48 percent of the business. That represents around 18 percent of the company’s contracts, as compared to a national average of 3 to 4 percent.

• Fifty-six percent of the board of directors is composed of women and people of color. • Women and people of color represent 50 percent of Denny’s senior management.79

Thanks to these advancements, Black Enterprise magazine named Denny’s one of the best corporations for African Americans, and Fortune continually ranks Denny’s in its list of “America’s 50 Best Corporations for Minorities.” Denny’s turnaround is one of the best exam- ples of how far and how fast a company can progress with strong leadership and an aggressive approach to culture change. Denny’s leaders have moved toward Stage 5 of the diversity awareness scale in Exhibit 11.7.

At stage 5 of diversity awareness, people are capable of integrating differences and adapting both cognitively and behaviorally. It is at this stage where leaders can create organizations that are gender- and color-blind. All employees are judged on their competence, and stereotypes and prejudices are completely erased. No group of employees feels different or disadvantaged. Stage 5 represents the ideal leader and organization. Although it may seem unreachable, many of today’s best leaders are striving to achieve this stage of diversity awareness and acceptance. The com- mitment of top leaders is critical to building organizations that embrace diversity in all aspects of the business.

WAYS TO ENCOURAGE THE ADVANCEMENT OF WOMEN AND MINORITIES Personal diversity awareness is the first step to creating a culture that embraces inclusion and enables all people to reach their potential, thereby enabling the orga- nization to perform at its best. “Leaders are responsible for setting the tone for the working environment,” and they can set an inclusive tone in which everyone can feel valued and have a chance to succeed, says Belinda Pinckney, a retired military officer who currently serves as president and CEO of Better Horizons and Possibili- ties Consulting.80 Leaders have tried a variety of approaches to encourage an inclu- sive culture. Two effective options for getting more minority representation at higher levels are employee affinity groups and minority sponsorship.

NEW LEADER ACTION MEMO As a leader, you can advance to higher stages of diversity awareness and action. You can commit to valuing diversity and providing equal opportu- nities for everyone.

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 347

Employee Affinity Groups Employee affinity groups are based on social identity, such as gender or race, and are organized to focus on concerns of employees from that group.81 These groups are sometimes called diversity networks or employee resource groups. Employee affinity groups let individuals of similar background share common experiences and suc- cess strategies, enabling them to make greater contributions to the organization and advance their careers. Affinity groups first emerged in the 1970s, primarily to focus on the recruitment and retention of African Americans. Today, they have evolved to incorporate employees from a wide variety of backgrounds. Cisco Systems has groups that provide leadership and growth opportunities for Asians, African Americans, women, Middle Eastern employees, veterans, Latinos, gays and lesbians, the disabled, and others. The company’s 11 affinity groups rep- resent more than 18 percent of 72,000 Cisco employees worldwide.82

Affinity groups pursue a variety of activities, such as meetings to educate top leaders, mentoring programs, networking events, training sessions and skills seminars, minority intern programs, and community volunteer activities. These activities give people a chance to meet, interact with, and develop social and professional ties to others throughout the organization, which often includes influential executives and key decision makers. Affinity groups are a powerful way to reduce social isolation for women and minorities, help these employees be more effective, and enable members to achieve greater career advancement. Studies confirm that these groups can be impor- tant tools for helping organizations retain managerial-level minority employees.83

Important characteristics of effective affinity groups are that they involve senior leaders in group events and that they find ways to directly contribute to organiza- tional effectiveness. As president of Cisco’s Latino group, Conexión, Guillermo Diaz Jr. transformed it from a “social club with a happy hour” into a business resource, influencing Spanish-speaking customers and organizing conferences for Latino IT leaders. Three years later, Diaz was promoted to a vice president posi- tion.84 At BT (formerly called British Telecom), members of the disability network, Able2, trained installation engineers to let visually impaired customers feel the box before it was installed. “Rather than developing slightly artificial programmes that give the networks visibility, they get noticed for all the right reasons because they are helping the business,” Caroline Walters, BT’s director of people and policy, says of the new approach to affinity groups.85

Expanding employee affinity groups beyond providing personal support to enabling people to bring value to the business helps organizations and individuals.86

Anne F. Ackerley earned a promotion to chief marketing officer of BlackRock, the world’s largest money manager by assets, largely because of the role she played in the company’s affinity group for women and the exposure it gave her to senior leaders.87

When people feel that they are making genuine contributions and have a chance to advance in their careers because of it, engagement soars. “At some of our events, the buzz in the room is magnificent,” said Shakrat Alli, chairwoman of Britain’s Crown Prosecution Service’s affinity group for African Americans (the National Black Crown Prosecution Association). “People return to the workplace with the sense that everything is possible.”88

Minority Sponsorship Another benefit of employee affinity groups is that people often obtain sponsors through their affiliation with the groups. Ken Wilson, a vice chairman and member

NEW LEADER ACTION MEMO As a leader, you can support the personal development and career advancement of women and minorities by creating and encouraging employee affinity groups. Use sponsorship to help high-potential minority em- ployees reach higher levels.

348 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Employee affinity groups Groups based on social identity that focus on con- cerns of employees from that group and enable them to make greater contribu- tions to the organization

of BlackRock’s powerful global advisory committee, for example, became a sponsor for Anne Ackerley after seeing her in action with the company’s women’s group, and he supported her career and eventually helped her get the promotion to chief marketing officer. Ackerley’s work with the women’s network, says Wilson, “gave her a firm-wide profile. She wasn’t that well known [before].”89

Sponsorship refers to strong support from a powerfully positioned executive who is willing to put his or her reputation on the line to promote an individual’s advancement to higher organizational levels.90 Sponsorship is mentorship on ster- oids. Mentors are important because they offer advice and guidance, but a spon- sor actually advocates on behalf of the protégé and connects the individual to important people and assignments. Because they go out on a limb, sponsors expect outstanding performance and unwavering commitment.91

Sylvia Hewlett, author of Forget a Mentor, Find a Sponsor, led a two-year study that shows that sponsorship makes a measurable difference in career advancement.92

Sponsors make sure their protégés get considered for important projects and have opportunities to show what they can do. In addition, people with sponsors are more likely to ask for stretch assignments, request salary increases, and seek opportunities. Yet only 5 percent of minorities have sponsors compared to 21 percent of white employ- ees. Just as with job promotions, when senior leaders pick someone to sponsor, they almost automatically turn to people like themselves. Companies such as American Express, AT&T, Citigroup, Credit Suisse, Deloitte, Genentech, and Morgan Stanley have made sponsorship more accessible for minorities by making sure senior executive know of high-potential female and minority candidates.93

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • One main point of this chapter is that diversity is a fact of life in today’s world,

and leaders can create change in organizations to keep pace with the changing environment. The U.S. population, the workforce, and the customer base are changing. In addition, organizations are operating in an increasingly global world, which means dealing with diversity on a broader stage than ever before.

• Diversity is defined as all the ways in which people differ. This definition has been broadened in recent years to be more inclusive and recognize a broad spectrum of characteristics. The inclusive definition of diversity embraces not only dimensions such as gender and race but also characteristics such as work style, nationality, and income level.

• There are several reasons why organizations are recognizing the need to value and support diversity. Diversity of thought provides a broader and deeper base of experience for problem solving and is essential to keep organizations thriving in today’s rapidly changing environment. A diverse workforce helps organiza- tions build better relationships with diverse customers and helps develop employee potential. One aspect of diversity of recent interest is women’s style of leadership, referred to as interactive leadership. The values associated with inter- active leadership, such as inclusion and relationship building, are emerging as valuable qualities for both male and female leaders in the twenty-first century.

Sponsorship strong support from a pow- erfully positioned executive who is willing to put his or her reputation on the line to promote an individual’s career advancement

Tw itt er

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 349

• Today’s leaders face significant challenges leading people who are different from themselves. The first step for leading diverse people is understanding the hardships that people who do not fit the mainstream white, U.S.-born, male culture often endure. These include prejudice, stereotypes, discrimination, and the glass ceiling.

• Another important issue is global diversity. Leaders can be aware of the impact culture may have, understand social and cultural value differences, and develop cultural intelligence.

• People differ in their level of diversity awareness and their sensitivity to other cultures, values, and ways of doing things. Leaders evolve through stages of personal diversity awareness and action ranging from minimum efforts to meet affirmative action guidelines to valuing diversity as an integral part of organizational culture. Strong, culturally sensitive leadership is the only way organizations can become inclusive.

• The ultimate goal for leaders in the twenty-first century is to build organiza- tions as integrated communities in which all people feel encouraged, respected, and committed to common purposes and goals. Employee affinity groups and sponsorship are two important ways leaders can support the participation and advancement of women and minority employees.

DISCUSSION QUESTIONS 1. Do you agree with sociologist William Bielby that people have innate biases and will

automatically discriminate if left to their own devices? Discuss.

2. Why is diversity of thought important for today’s organizations? Do you think an orga- nization can have diversity of thought if all employees are of the same race and approxi- mately the same age and background?

3. What is interactive leadership, and why might this approach be increasingly important for all leaders in the twenty-first century?

4. Discuss ways in which low power distance as a social value among followers could affect their interaction with a leader who displays high power distance.

5. Why do you think many women opt out from seeking higher levels of corporate leader- ship? Discuss why you think this either is or is not a trend that might hurt organizations over the next decade.

6. Take another look at this chapter’s Consider This box. What might be some reasons men seem to be falling behind in today’s world? If this is true, why is it that women are still so poorly represented at higher organizational levels?

7. Why is it important for today’s leaders to develop cultural intelligence? Do you think a leader who has never had experience with people different from himself or herself can develop the ability to smoothly adapt to culturally different ways of thinking and behav- ing? Discuss.

8. Recall a leader you worked for. At what stage of personal diversity awareness (refer to Exhibit 11.7) was this leader? Explain. At what stage of diversity awareness are you?

9. Do you think people and organizations can ever become gender- and color-blind? Discuss.

10. The chapter described a conflict at a meatpacking plant over providing break times for Muslims to pray. How might leaders accommodate the needs of diverse groups without offending other groups or appearing to show favoritism?

350 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Complete this assignment online with CengageNOW.

C a C

LEADERSHIP AT WORK Personal Diversity Each of us feels different in many ways from the average behavior or expectations that other people seem to value. This reflects our own feelings of diversity. The differences you feel compared to others could be about your physical characteristics (height, age, skin color) but also could reflect a difference in your thinking style, feelings, personality, or behavior, especially when you feel different from what other people expect or what you perceive are the social norms. Write in the following list six ways you feel different from others:

1. 4.

2. 5.

3. 6.

Now answer the following questions with respect to your perceived diversity. What are your feelings about being different?

Which elements of diversity are you proud of? Why?

What element would you like to change to be less diverse? Why?

How do your differences contribute to a student team or work organization?

In Class: This exercise can be adapted for group discussion in class about underlying diver- sity. The instructor can ask students to sit in teams of three to five members in a circle facing each other. A student (focal person) then volunteers to describe the ways he or she feels dif- ferent from others based on the previous list. Other students take turns providing feedback to the focal person on what the perceived differences mean to them with respect to team or class contributions. Each student takes a turn as the focal person, describing their feelings of being different and hearing feedback from others on the perception and impact of those differences.

Here are the key questions for this exercise: What did you learn about perceived diver- sity and interpersonal relations? What does it mean when our differences appear larger to ourselves than they appear to others? How does personal diversity affect team or organiza- tional performance? (A list can be written on the board.)

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 351

Check out CengageNOW for additional cases with interactive activities.

C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS True to Myself Ethney Gentry was thrilled to have infiltrated the ultimate good old boy network, landing a job with a mid-size Tulsa-based oil company. Armed with solid credentials and what she considered the strengths of female leadership—listening, collaboration, consensus building, and organization—she looked forward to her first meeting with the company’s retiring first female manager, Alexis Bale.

Alexis offered a firm, almost painful handshake and a cup of coffee. “I’ve been looking forward to meeting you, Alexis,” Ethney said. “It’s Alex.” “Oh, I didn’t know.” Ethney took a sip of piping hot coffee with a sudden vague feeling

of discomfort. The first moments of this much-anticipated meeting seemed awkward and somewhat strained.

“I’ll be honest with you,” Alex said as she walked around and sat in the oversized chair behind her desk. “You’re here for the same reason I was here. When our founder, Champ Luman, died twelve years ago, his three middle-aged daughters, referred to throughout the company as the girls, became major shareholders. They pushed hard for the inclusion of a woman in management. That was me. Now it’s you.”

Ethney tried to show no reaction as she set her cup on the desk. “Are you implying that I was selected over more qualified male candidates?”

“No. I was not on the selection team. I’ve seen your resume and you are an excellent addition to the organization. But qualifications aside, you and I fulfill, shall we say—the ‘diversity’ requirements for an otherwise all-male club.”

Ethney could not believe the undisguised cynicism of the woman across the desk. She was torn between a desire to get up and march out of the office and a desire to stay and hear the entire lecture. She decided to take the high road. “My understanding was that you have been very successful here,” she said.

“I suppose so.” Alex gazed up at the numerous photographs showing oil rigs scattered across the Oklahoma plains. “I learned to play the game,” she said somewhat wistfully and then suddenly turned and looked at Ethney. “I’m not trying to intimidate you. But I think that coming in, you should understand some things.”

“Such as?” “Such as … don’t be too eager with your ideas or opinions. When I started, I intended

to jump right in and contribute. The men resented it. I was considered a ‘pushy broad’ as one gentleman told me to my face. The reaction to me was harsh. They may have been stuck with me, but these guys could marginalize me, make sure I didn’t count, and make sure I knew it.”

“What did you do?” “I stewed awhile and finally tried the opposite tactic. I jumped up to get coffee for

everyone. I sought the wise counsel of their opinions before daring to make a suggestion in meetings. I played the female image that was in their minds. I felt like an idiot. I kowtowed till I thought I would throw up.”

“How did they react?” “I was no longer marginalized. But I wasn’t respected either. I had quietly stepped back

and accepted my place.” “Why didn’t you just quit?” “Because I knew that’s exactly what they wanted me to do. And I’m just stubborn

enough not to give them what they wanted.” Ethney took a deep breath and shook her head. “This sounds like the 1950s. I can’t

believe men in management act like this.” “Uh-huh. It may be a little better now, but they are still throwbacks to Mad Men.”

352 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

“So how did you develop this reputation for success if you went from being ignored to being a doormat?”

“Have you met Bill Ledson?” Ethney nodded, took a sip of coffee, and leaned forward, waiting to hear the secret of success.

“At an industry meeting in Houston, his wife, Margaret, got tipsy, cornered me, and drawled, ‘Listen, Honey. I’ve been around oil men all my life. My daddy and his daddy were oil men. You’re going to have to wise up and take the plunge—become one of the boys. It’s the only way you’ll ever be accepted.’ She reminded me that I’m on their turf. Margaret told me, ‘Honey, as a wife and hostess for this crowd, I’ve talked more football than you can imagine. I hate football. I hang on for the commercials. But they don’t know that. Bill doesn’t know that. Me and God—we’re the only ones who know that. Trust me,’ she said. ‘These guys do get down to some serious business, but not until they grouse about how Oklahoma State was robbed of its chance to play LSU for the national championship.’ ”

“Isn’t that trivializing the men in this company?” Ethney asked. Alex shrugged. “It worked. I became Alex and I became one of the guys. And, over

time, I came to be treated with grudging respect, and promotions followed. I held the room spellbound for fifteen minutes at the last board meeting with my theory that Texas A&M joined the Southeastern Conference in order to up their chances for better bowls because the BCS favors the SEC. Later, when I submitted my ideas for improving coordination of teams in the oil fields, they thought it was brilliant! I’m one of them!”

Ethney nodded, somewhat impressed. “Take my advice. Change your name. Ethney is too girlie. What’s your middle name?” “Madison.” “Be Madison.” Alex walked Ethney to the door and shook her hand. The meeting was

over. As the door closed behind her, Ethney’s feelings about what she had just heard ranged

from bewilderment to anger to depression. She sold out. All of these women sold out. They can’t even be who they are. I am an experienced, educated, qualified, capable woman. I don’t want to be Madison, Ethney thought confidently and pushed the elevator button.

The elevator opened and she stepped inside. What have I gotten myself into?

QUESTIONS

1. If you were Ethney, how would you try to conduct yourself at the oil company? Why do you think your approach would be successful?

2. Do you think male-dominated cultures like this one still exist? Do you think women have to plot a strategy to be accepted? Would you adopt a strategy in which you acted different from your normal personality? Why?

3. What does it mean to be “True to yourself”? Is being true to yourself more important than achieving personal career success in a male-dominated company? Is it okay to enable the continuation of an “unhealthy” work environment for women? Why?

The Trouble with Bangles Leela Patel was standing by her machine, as she had for eight hours of each working day for the past six years. Leela was happy; she had many friends among the 400 or so women at the food processing plant. Most of them were of Indian origin like herself, although Asian women formed less than a fifth of the female workforce. Leela was a member of a five- woman team that reported to supervisor Bill Evans.

Leela saw Evans approaching now, accompanied by Jamie Watkins, the shop steward. “Hello, Leela; we’ve come to explain something to you,” Evans began. “You must have heard about the accident last month when one of the girls caught a bangle in the machine and cut her wrist. Well, the Safety Committee has decided that no one will be allowed to

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 353

wear any bangles, engagement rings, earrings, or necklaces at work—only wedding rings, sleepers for pierced ears, and wristwatches will be allowed. So I’m afraid you’ll have to remove your bangles.” Leela, as was her custom, was wearing three bangles—one steel, one plastic, and one gold. All the married Asian women wore bangles, and many of the English girls had also begun wearing them. Leela explained that she was a Hindu wife and the ban- gles were important to her religion.

“Don’t make a fuss, Leela,” Evans said between clenched teeth. “I’ve already had to shout at Hansa Patel and Mira Desai. Why can’t you all be like Meena Shah? She didn’t mind taking her bangles off; neither did the English girls.” Leela could see that Evans was very angry, so, almost in tears, she removed the bangles. When the two had moved off, how- ever, she replaced the gold bangle and carried on with her work.

Within two or three days, the plant manager, Sam Jones, noticed that all the Asian women were wearing their bangles again—some, in fact, were wearing more than ever before. “I’m stag- gered by the response that this simple, common-sense restriction on the wearing of jewelry has brought,” Jones remarked to the regional race relations employment advisor. “I have had several deputations from the Asian women protesting the ban, not to mention visits by individuals on the instruction of their husbands. In addition, I’ve just had a letter from something called the Asian Advisory Committee, asking that the ban be lifted until we meet with their representatives. The strength of this discontent has prompted me to talk to you. Jewelry constitutes both a safety and a hygiene hazard on this site, so it must be removed. And I’m afraid if I talk to this Asian Committee, they’ll turn out to be a bunch of militants who’ll cause all sorts of trouble. At the same time, we can’t afford any work stoppages. What do you suggest?”

Several days later, the advisor had arranged for Mr. Singh from the local Council for Community Relations to talk to Jones and other managers. Singh explained that in his opinion there were no obstacles arising from religious observance that prevented implementation of the ban on bangles. However, he pointed out, the bangles do have a custom base that is stronger than the English tradition base for wedding rings. “The bangles are a mark not only of mar- riage but of the esteem in which a wife is held by her husband. The more bangles and the greater their value, the higher her esteem and the greater her social standing. The tradition also has religious overtones, since the wearing of bangles by the wife demonstrates that each recognizes the other as ‘worthy’ in terms of the fulfillment of their religious obligations. This position is further complicated in that women remove their bangles if they are widowed, and some fear that the removal of the bangles may lead to their husbands’ deaths.”

QUESTIONS

1. What is your initial reaction to this story? Why do you think you had this reaction?

2. Based on this limited information, how would you rate this organization in terms of developing leadership diversity? Discuss.

3. If you were a top executive at this company, how would you handle this problem?

Source: Adapted from “Bangles,” in Allan R. Cohen, Stephen L. Fink, Herman Gadon, and Robin D. Willits, Effective Behavior in Organizations: Cases, Concepts, and Student Experiences, 7th ed. (Burr Ridge, IL: McGraw-Hill Irwin, 2001), pp. 413–414.

REFERENCES 1. Steven Greenhouse, “Lawsuit Claims Race Bias at Wet Seal Retail

Chain,” The New York Times (July 12, 2012), http://www.nytimes .com/2012/07/13/business/wet-seal-accused-of-racial-bias-by-3-ex -managers.html?_r=0 (accessed May 8, 2013).

2. Quoted in “Diversity in the New Millennium,” Working Woman (September 2000), special advertising section.

3. Quoted in Colleen McCain Nelson, “Poll: Most Women See Bias in the Workplace,” The Wall Street Journal (April 12, 2013), p. A4.

4. Marilyn Loden and Judy B. Rosener, Workforce America! (Home- wood, IL: Business One Irwin, 1991); and Marilyn Loden, Imple- menting Diversity (Homewood, IL: Irwin, 1996).

5. Anthony Oshiotse and Richard O’Leary, “Corning Creates an Inclusive Culture to Drive Technology Innovation and Performance,” Global Business and Organizational Excellence 26, no. 3 (March– April 2007), pp. 7–21.

354 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

6. Frances J. Milliken and Luis I. Martins, “Searching for Common Threads: Understanding the Multiple Effects of Diversity in Organiza- tional Groups,” Academy of Management Review 21, no. 2 (1996), pp. 402–433.

7. C. Keen, “Human Resource Management Issues in the ’90s,” Vital Speeches 56, no. 24 (1990), pp. 752–754.

8. U.S. Census Bureau figures reported in Russ Wiles, “Businesses Encourage Employees to Learn Spanish,” USA Today (December 7, 2008), http://www.usatoday.com/money/workplace/2007-12-08-spanish _n.htm?loc=interstitialskip (accessed March 17, 2008).

9. “Foreign-Born Workers and Labor Force Characteristics: 2011,” United States Labor Department Bureau of Labor Statistics, http:// www.bls.gov/news.release/pdf/forbrn.pdf (accessed June 29, 2012).

10. Occupational Outlook Handbook, Bureau of Labor Statistics, http:// www.bls.gov/ooh/about/projections-overview.htm#laborforce (accessed June 29, 2012).

11. Wall Street Journal poll, reported in Colleen McCain Nelson, “Poll: Most Women See Bias in the Workplace,” The Wall Street Journal (April 12, 2013), p. A4.

12. Edward Iwata, “Companies Find Gold Inside Melting Pot; Diverse Staff Helps Business Run Smoothly across Borders,” USA Today (July 9, 2007), p. B1.

13. Louise Story, “Seeking Leaders, U.S. Companies Think Globally,” The New York Times (December 12, 2007), p. A1; Justin Martin, “The Global CEO: Overseas Experience Is Becoming a Must on Top Executives’ Resumes,” Chief Executive (January–February 2004), p. 24; and G. Pascal Zachary, “Mighty Is the Mongrel,” Fast Company (July 2000), pp. 270–284.

14. “Britain Recruiters Seek Female Spies,” USA Today (July 12, 2008), http://www.usatoday.com/news/world/2008-07-12-spy_N.htm (accessed June 5, 2009).

15. “Lack of Diversity Paralyzed the CIA. It Can Cripple Your Organization, Too,” Guest post by Philippe Silberzahn and Milo Jones, Frederick E. Allen Leadership Blog, Forbes, http://www.forbes .com/sites/frederickallen/2012/04/26/lack-of-diversity-paralyzed-the -cia-it-can-cripple-your-organization-too/ (accessed May 8, 2013); and Petraeus quote from the CIA Web site, https://www.cia.gov/careers /diversity/directors-diversity-commitment.html (accessed July 19, 2012).

16. Thomas E. Poulin, “The Other Diversity,” PA Times, American Society for Public Administration (March 2009), p. 8; and Clayton H. Osborne and Vincent M. Cramer, “Fueling High Performance through Diversity,” Chief Learning Officer (November 2005), p. 22.

17. Yair Holtzman and Johan Anderberg, “Diversify Your Teams and Collaborate: Because Great Minds Don’t Think Alike,” Journal of Management Development 30, no. 1 (2011), pp. 75–92.

18. Taylor H. Cox, Cultural Diversity in Organizations (San Francisco: Berrett-Koehler, 1994); Anita Woolley and Thomas Malone, “What Makes a Team Smarter? More Women,” Harvard Business Review (June 2011), pp. 32–33

19. Thomas Barta, Markus Kleiner, and Tilo Neumann, “Is There a Payoff from Top-Team Diversity?” McKinsey Quarterly, Issue 2 (April 2012), pp. 13–15.

20. Quoted in Herminia Ibarra and Morten T. Hansen, “Are You a Collaborative Leader?” Harvard Business Review (July–August 2011), pp. 69–74.

21. Vanessa Lau and Brian Kleiner, “A Diverse Workforce for Diverse Markets,” Industrial Management (July–August 2012), pp. 28–30; Tanzina Vega, “With Diversity Still Lacking, Industry Focuses on Retention,” The New York Times (September 3, 2012); and Orlando C. Richard, “Racial Diversity, Business Strategy, and Firm Perfor- mance: A Resource-Based View,” Academy of Management Journal 43, no. 2 (2000), pp. 164–177.

22. Lau and Kleiner, “A Diverse Workforce for Diverse Markets.”

23. Quoted in Susan Caminiti, “The Diversity Factor,” Fortune (October 19, 2007), pp. 95–105.

24. G. Haight, “Managing Diversity,” Across the Board 27, no. 3 (1990), pp. 22–29.

25. Atul Gawande, “Manning the Hospital Barricades: Why Do Groups— Even Groups of Doctors—Hate Each Other?” Slate (June 26, 1998), h t t p : / / w w w . s l a t e . c o m / a r t i c l e s / h e a l t h _ a n d _ s c i e n c e / m e d i c a l _examiner/1998/06/manning_the_hospital_barricades.html (accessed July 10, 2013).

26. Norma Carr-Ruffino, Managing Diversity: People Skills for a Multicultural Workplace (Tucson, AZ: Thomson Executive Press, 1996), p. 92; and Judy Rosener, America’s Competitive Secret: Women Managers (New York: Oxford University Press, 1995), pp. 33–34.

27. Susan Webber, “Fit vs. Fitness,” The Conference Board Review (July– August 2007), pp. 19–25.

28. Reported in Roger Parloff, “The War over Unconscious Bias,” Fortune (October 15, 2007), pp. 90–102.

29. Marianne Bertrand, “Racial Bias in Hiring: Are Emily and Brendan More Employable than Lakisha and Jamal?” Capital Ideas (February 2005), pp. 7–9; and Marianne Bertrand and Sendhil Mullainathan, Are Emily and Greg More Employable than Lakisha and Jamal? (National Bureau of Economic Research Report), as reported in L. A. Johnson, “What’s in a Name: When Emily Gets the Job over Lakisha,” The Tennessean (January 4, 2004), p. 14A.

30. Shaunti Feldhahn, “Cracking the Male Code of Office Behavior,” The New York Times (February 5, 2011), http://www.nytimes.com/2011 /02/06/jobs/06pre.html?_r=0 (accessed May 9, 2013).

31. Reported in Michael Orey, “White Men Can’t Help It,” Business- Week (May 15, 2006), pp. 54, 57.

32. Johnson, “What’s in a Name: When Emily Gets the Job over Lakisha.”

33. Debra E. Meyerson and Joyce K. Fletcher, “A Modest Manifesto for Shattering the Glass Ceiling,” Harvard Business Review (January– February 2000), pp. 127–136; Julie Amparano Lopez, “Study Says Women Face Glass Walls as Well as Glass Ceiling,” The Wall Street Journal (March 3, 1992), pp. B1, B2; and Joann S. Lublin, “Women at Top Still Are Distant from CEO Jobs,” The Wall Street Journal (February 28, 1996), pp. B1, B8.

34. John Beeson and Anne Marie Valerio, “The Executive Leadership Imperative: A New Perspective on How Companies and Executives Can Accelerate the Development of Women Leaders,” Business Horizons 55 (2012), pp. 417–425.

35. Joanna Barsh, Sandrine Devillard, and Jin Wang, “The Global Gender Agenda,” McKinsey Quarterly (November 2012), http:// www.mckinsey.com/insights/organization/the_global_gender_agenda (accessed May 10, 2013).

3 6 . “ A fr ican Amer ican C EOs o f F o r tu n e 5 0 0 C omp a n ies ,” BlackEntrepreneurProfile.com, http://www.blackentrepreneurpro- file.com/fortune-500-ceos (accessed June 3, 2009); Heidi Evans, “Ursula Burns to Head Xerox, Will Be First Black Woman to Be CEO of Fortune 500 Company,” NY Daily News (May 22, 2009), http:// www.nydailynews.com/news/money/ursula-burns-head-xerox-black- woman-ceo-fortune-500-company-article-1.412330 (accessed July 11, 2013); and Barbara Reinhold, “Smashing Glass Ceilings: Why Women Still Find It Tough to Advance to the Executive Suite,” Journal of Organizational Excellence (Summer 2005), pp. 43–55; Jory Des Jardins, “I Am Woman (I Think),” Fast Company (May 2005), pp. 25–26; and Meyerson and Fletcher, “A Modest Manifesto for Shattering the Glass Ceiling.”

37. Anat Arkin, “Hidden Talents,” People Management (July 14, 2006).

38. “Salary Gap Widens between German Men and Women,” Spiegel Online (March 5, 2010), http://www.spiegel.de/international/europe

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 355

/gender-inequality-salary-gap-widens-between-german-men-and -women-a-682026.html (accessed May 9, 2013); and Sarah Plass, “Wage Gaps for Women Frustrating Germany,” The New York Times (September 3, 2008), p. C1.

39. Ginny Parker Woods, “Japan’s Diversity Problem,” The Wall Street Journal (October 24, 2005), pp. B1, B4.

40. Sheelah Kolhatkar, “Arrested Development,” Bloomberg Business- week (February 4–10, 2013), pp. 6–7.

41. Lisa Belkin, “The Opt-Out Revolution,” The New York Times Magazine (October 26, 2003), pp. 43–47, 58.

42. Sylvia Ann Hewlett and Carolyn Buck Luce, “Off-Ramps and On- Ramps: Keeping Talented Women on the Road to Success,” Harvard Business Review (March 2005), pp. 43–54.

43. Sheila Wellington, Marcia Brumit Kropf, and Paulette R. Gerkovich, “What’s Holding Women Back?” Harvard Business Review (June 2003), pp. 18–19.

44. The Leader’s Edge/Executive Women Research 2002 survey, reported in “Why Women Leave,” Executive Female (Summer 2003), p. 4.

45. Reinhold, “Smashing Glass Ceilings”; Des Jardins, “I Am Woman (I Think)”; and Alice H. Eagly and Linda L. Carli, “The Female Leadership Advantage: An Evaluation of the Evidence,” The Leader- ship Quarterly 14 (2003), pp. 807–834.

46. Joelle K. Jay and Amber Barnes, “Rising Above the Glass Ceiling,” T D (January 2013), pp. 52–55.

47. Ibid.

48. Beeson and Valerio, “The Executive Leadership Imperative”; Leslie Kwoh, “McKinsey Tries to Recruit Mothers Who Left the Fold,” The Wall Street Journal (February 19, 2013), http://online.wsj.com/article /SB10 00 14 24 12 788 73 23 76 48 04 578 31 44 50 06 391 43 88 .html (accessed May 10, 2013).

49. Reported in Sharon Hadary and Laura Henderson, “Lead Boldly!” Leadership Excellence (January 2013), pp. 16–17; and studies reported in Avivah Wittenberg-Cox and Alison Maitland, “Financial Diversity: Why Women in Business Became the Solution, Not the Problem; Numbers of Top Female Executives Are Falling Yet Evidence Suggests They May Hold the Key to Corporate Success,” The Guardian (February 5, 2008), p. 23; and Dwight D. Frink, Robert K. Robinson, Brian Reithel, Michelle M. Arthur, Anthony P. Ammeter, Gerald R. Ferris, David M. Kaplan, and Hubert S. Morrisette, “Gender Demography and Organization Performance: A Two-Study Investigation with Convergence,” Group & Organiza- tion Management 28, no. 1 (March 2003), pp. 127–147.

50. Sharon Hadary and Laura Henderson, How Women Lead (McGraw- Hill 2013); Carol Kinsey Goman, “What Men Can Learn from Women about Leadership in the 21st Century,” The Washington Post (August 10, 2011), http://articles.washingtonpost.com/2011-08-10 /national/35271442_1_female-leaders-leadership-women (accessed May 10, 2013); Judy B. Rosener, America’s Competitive Secret: Women Managers (New York: Oxford University Press, 1995); Judy B. Rosener, “Ways Women Lead,” Harvard Business Review (November–December 1990), pp. 119–125; Sally Helgesen, The Female Advantage: Women’s Ways of Leadership (New York: Currency/Doubleday, 1990); Joline Godfrey, “Been There, Doing That,” Inc. (March 1996), pp. 21–22; Chris Lee, “The Feminization of Management,” Training (November 1994), pp. 25–31; and Bernard M. Bass and Bruce J. Avolio, “Shatter the Glass Ceiling: Women May Make Better Managers,” Human Resource Manage- ment 33, no. 4 (Winter 1994), pp. 549–560.

51. Reported in Tamar Lewin, “The New Gender Divide: At Colleges, Women Are Leaving Men in the Dust,” The New York Times (July 9, 2006), Section 1, p. 1; and Mary Beth Marklein, “College Gender Gap Widens: 57% Are Women,” USA Today (October 20, 2005), p. A1.

52. Hanna Rosin, The End of Men–and the Rise of Women (New York: Riverhead/Penguin 2012); Hanna Rosin, “The End of Men,”

The Atlantic (July–August 2010), http://www.theatlantic.com/magazine /archive/2010/07/the-end-of-men/308135/ (accessed May 10, 2013).

53. Lewin, “At Colleges, Women Are Leaving Men in the Dust”; and Jon Swartz, “Women Break to Front of Tech,” USA Today (July 10, 2008), http://www.usatoday.com/money/companies/management /2008-07-10-women-ceos_N.htm (accessed July 11, 2008).

54. Quoted in Michelle Conlin, “The New Gender Gap,” BusinessWeek (May 26, 2003), pp. 74–82.

55. Kathryn M. Bartol, David C. Martin, and Julie A. Kromkowski, “Leadership and the Glass Ceiling: Gender and Ethnic Group Influences on Leader Behaviors at Middle and Executive Managerial Levels,” The Journal of Leadership and Organizational Studies 9, no. 3 (2003), pp. 8–19; Bass and Avolio, “Shatter the Glass Ceiling”; and Rochelle Sharpe, “As Leaders, Women Rule,” BusinessWeek (November 20, 2002), pp. 75–84.

56. Bass and Avolio, “Shatter the Glass Ceiling.”

57. Cynthia Carroll, “Why Different Is Better,” Newsweek (January 29, 2007), p. E4.

58. Reported in Carol Kinsey Goman, “What Men Can Learn from Women.”

59. The study on competitiveness was reported in Hal R. Varian, “The Difference between Men and Women, Revisited: It’s about Competi- tion,” The New York Times (March 9, 2006), p. C3. For reviews and analyses of the research on gender differences in leadership, see Hadary and Henderson, “Lead Boldly!”; Nicole Z. Stelter, “Gender Differences in Leadership: Current Social Issues and Future Organiza- tional Implications,” The Journal of Leadership Studies 8, no. 4 (2002), pp. 88–99; and Alice H. Eagly, Mary C. Johannesen-Schmidt, and Marloes L. van Engen, “Transformational, Transactional, and Laissez-Faire Leadership Styles: A Meta-Analysis Comparing Women and Men,” Psychological Bulletin 129, no. 4 (July 2003), p. 569ff.

60. Quoted in Lena Williams, “A Silk Blouse on the Assembly Line? (Yes, the Boss’s),” The New York Times (February 5, 1995), Business Section, p. 7.

61. Based on Rosener, America’s Competitive Secret, pp. 129–135.

62. Susan Carey, “More Women Take Flight in Airline Operations,” The Wall Street Journal (August 14, 2007), p. B1; Ann Therese Palmer, “Teacher Learns All About Airline; United VP Began as Reservations Clerk, Rose through Ranks,” Chicago Tribune (December 24, 2006), p. 3; Paul Merrion, “Cindy Szadokierski,” Crain’s Chicago Business (May 5, 2007), http://www.chicagobusiness.com/article/20070505 /ISSUE02/100027750/cindy-szadokierski (accessed May 10, 2013).

63. Susan J. Wells, “A Female Executive Is Hard to Find,” HR Magazine (June 2001), pp. 40–49; Hadary and Henderson, “Lead Boldly!”; Goman, “What Men Can Learn from Women”; and Helgesen, The Female Advantage.

64. “Muslim Leader: 150 Workers Fired over Prayer Dispute in Nebraska,” USA Today (September 19, 2009), http://www.usatoday .com/news/religion/2008-09-19-muslim-prayer-business_N.htm (accessed September 20, 2008).

65. Kevin Maguire, “Harriet Harman’s Equality Bill Signposts the Route to a Better Britain,” Mirror.co.uk (April 29, 2009), http://www . m i r r o r . c o . u k / n ew s / co l u m n i s ts / m a g u i r e / 2 0 0 9 / 0 4 / 2 9 / h a r r i e t -harman-s-equality-bill-points-to-the-route-for-a-better-britain -115875-21316506 (accessed June 5, 2009).

66. Helen Bloom, “Can the United States Export Diversity?” Across the Board (March/April 2002), pp. 47–51.

67. Reported in “Molding Global Leaders,” Fortune (October 11, 1999), p. 270.

68. Geert Hofstede, “The Interaction between National and Organizational Value Systems,” Journal of Management Studies 22 (1985), pp. 347–357; and G. Hofstede, “The Cultural Relativity of the Quality of Life Concept,” Academy of Management Review 9 (1984), pp. 389–398.

356 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

69. Debby Young, “Team Heat,” CIO (September 1, 1998), Section 1, pp. 43–51.

70. Geert Hofstede, “Cultural Constraints in Management Theories,” excerpted in Dorothy Marcic and Sheila M. Puffer, Management International: Cases, Exercises, and Readings (St. Paul, MN: West Publishing, 1994), p. 24.

71. The discussion of cultural intelligence is based on P. Christopher Earley and Elaine Mosakowski, “Cultural Intelligence,” Harvard Business Review (October 2004), p. 139 ff; Ilan Alon and James M. Higgins, “Global Leadership Success through Emotional and Cultural Intelligence,” Business Horizons 48 (2005), pp. 501–512; P. C. Earley and Soon Ang, Cultural Intelligence: Individual Actions across Cultures (Stanford, CA: Stanford Business Books, 2003); and David C. Thomas and Kerr Inkson, Cultural Intelligence: People Skills for Global Business (San Francisco: Berrett-Koehler, 2004).

72. These components are from Earley and Mosakowski, “Cultural Intelligence.”

73. Karl Moore, “Great Global Managers,” Across the Board (May–June 2003), pp. 40–43.

74. Alison M. Konrad, Roger Kashlak, Izumi Yoshioka, Robert Waryszak, and Nina Toren, “What Do Managers Like to Do?” Group & Organization Management 26, no. 4 (December 2001), pp. 401–433.

75. Based on Nancy Adler, International Dimensions of Organizational Behavior, 5th ed. (Mason, OH: South-Western, 2008), pp. 49–52.

76. Reported in Jeanne Brett, Kristin Behfar, and Mary C. Kern, “Managing Multicultural Teams,” Harvard Business Review (November 2006), pp. 84–91.

77. Renee Blank and Sandra Slipp, “The White Male: An Endangered Species?” Management Review (September 1994), pp. 27–32; and Sharon Nelton, “Nurturing Diversity,” Nation’s Business (June 1995), pp. 25–27.

78. Based on M. Bennett, “A Developmental Approach to Training for Intercultural Sensitivity,” International Journal of Intercultural Relations 10 (1986), pp. 179–196.

79. “Strategic Diversity,” Denny’s Web site, http://www.strategicdiversity .com/Diverse_Company_Profiles_Dennys.htm (accessed May 10, 2013); Irwin Speizer, “Diversity on the Menu,” Workforce Management (November 2004), p. 41; Daniel Valentine, “King Award Given to Denny’s Executive,” Capital (January 15, 2006), p. D1; Jim Adamson, “How Denny’s Went from Icon of Racism to Diversity Award Winner,” Journal of Organizational Excellence (Winter 2000), pp. 55–68; and

Sonia Alleyne and Nicole Marie Richardson, “The 40 Best Companies for Diversity,” Black Enterprise (July 2006), p. 100.

80. Belinda Pinckney, “An Inclusive Environment … from a Leader’s Perspective,” Leader to Leader (Fall 2012), pp. 6–10.

81. This definition and discussion is based on Raymond A. Friedman, “Employee Network Groups: Self-Help Strategy for Women and Minorities,” Performance Improvement Quarterly 12, no. 1 (1999), pp. 148–163; and Joann S. Lublin, “To Climb the Ladder, Try Joining a Group,” The Wall Street Journal (December 26, 2012), p. B6.

82. Lublin, “To Climb the Ladder, Try Joining a Group”; and “Employee Resource Groups,” Cisco Systems, http://www.cisco.com/web/about /ac49/ac55/diversity_inclusion_employee.html (accessed May 13, 2013).

83. Raymond A. Friedman and Brooks Holtom, “The Effects of Network Groups on Minority Employee Turnover Intentions,” Human Resource Management 41, no. 4 (Winter 2002), pp. 405–421; and Raymond A. Friedman, Melinda Kane, and Daniel B. Cornfield, “Social Support and Career Optimism: Examining the Effectiveness of Network Groups among Black Managers,” Human Relations 51, no. 9 (1998), pp. 1155–1177.

84. Lublin, “To Climb the Ladder, Try Joining a Group.”

85. Hashi Syedain, “Premium Bonds,” People Management (September 2012), pp. 23–26.

86. Elizabeth Wasserman, “A Race for Profits,” MBA Jungle (March– April 2003), pp. 40–41.

87. Lublin, “To Climb the Ladder, Try Joining a Group.”

88. Syedain, “Premium Bonds.”

89. Lublin, “To Climb the Ladder, Try Joining a Group.”

90. Sylvia Ann Hewlett, “Mentors Are Good. Sponsors Are Better,” The New York Times (April 13, 2013), http://www.nytimes.com/2013/04 /14/jobs/sponsors-seen-as-crucial-for-womens-career-advancement .html?_r=0 (accessed May 13, 2013); and Stephanie Castellano, “Sponsoring Career Success for Minority Workers,” T D (November 2012), p. 18.

91. Hewlett, “Mentors Are Good. Sponsors Are Better.”

92. Sylvia Hewlett, Forget a Mentor, Find a Sponsor: The New Way to Fast-Track Your Career (Boston: Harvard Business Review Press, forthcoming).

93. Hewlett, “Mentors Are Good. Sponsors Are Better.”

CHAPTER 11 DEVELOPING LEADERSHIP DIVERSITY 357

Chapter 12: Leadership Power and Influence

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Use power and politics to help accomplish important organizational goals. • Practice aspects of charismatic leadership by pursuing a vision or idea that you care deeply about

and want to share with others.

• Apply the concepts that distinguish transformational from transactional leadership. • Use coalitional leadership to build alliances that can help you achieve important goals for the

organization.

• Call upon characteristics of Machiavellian-style leadership when tough actions are needed to benefit the organization in difficult times.

• Explain the difference between soft power and hard power and identify specific types of power in organizations.

• Describe structural, human resource, political, and symbolic frames of reference and identify your dominant leadership frame.

• Know how to increase power through political activity and use the influence tactics of appealing to a higher vision, rational persuasion, friendliness, reciprocity, developing allies, and direct persuasion.

CHAPTER OUTLINE 360 Four Kinds of Influential

Leadership

369 Using Hard versus Soft Power

374 Increasing Power through Political Activity

380 Don’t Take Power Personally

In the Lead

364 Helen Dragas and Teresa Sullivan, University of Virginia

368 The Evans Family

372 Patricia Sellers, Fortune Magazine

379 Paul Wolfowitz, World Bank

Leader’s Self-Insight

362 Transformational Leadership

368 What’s Your Mach?

376 Your Leadership Orientation

Leader’s Bookshelf

367 Power: Why Some People Have It and Others Don’t

Leadership at Work

383 Circle of Influence

Leadership Development: Cases for Analysis

384 The Suarez Effect

386 Waite Pharmaceuticals

A s more than 100 current and former Warner Brothers executives watched a documentary celebrating the studio’s 90th anniversary, something disconcerting happened. Not long into the film, the audio sputtered and images froze on the

screen as the digital projector malfunctioned. “Well, this is a less-than-auspicious start,” joked new CEO Kevin Tsujihara, who had assumed the top job three weeks earlier after a tense two-year power test among Tsujihara, Television Group president Bruce Rosenblum, and Motion Pictures Group president Jeff Robinov. Tsujihara was president of the studio’s Home Entertainment Group. Former Warner CEO Jeff Bewkes had created an Office of the President with the intention of inspiring the three ambitious leaders to engage in collegial competition for Bewkes’s job. “These three will work as a unit,” Bewkes declared.

Well, not so much, as it turned out. The three rarely worked together, with each executive maneuvering for better position and their subordinates quietly pushing for their favored candidate. The long stand-off makes Tsujihara’s job even more difficult

359 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

because it damaged morale and cohesiveness, straining the family feeling Warner Brothers is known for. He is likely up to the challenge, though. The word is that Tsujihara, a Buddhist, got the job because he was the least competitive of the trio and showed that he was eager to listen, friendly to everyone, and willing to collaborate and do what was best for the organization. Chairman Barry Meyer said, “We felt he had a better opportunity to bring all the elements of the company together, rather than make them more polarized.”1

All leaders use power and influence to get their jobs done and have an impact on their organizations, but personal competitiveness and self-promotion aren’t typically the best ways to obtain and exercise power in today’s collaborative world. Successful leaders use softer approaches to accomplish their goals, as Kevin Tsujihara did at Warner Brothers. This chapter explores the topic of leadership power and influence in detail. The chapter opens with a consideration of four types of influential leadership. We next examine what we mean by the terms power and influence, consider different leader frames of reference that affect how leaders think about and use power, look at the differences in using soft power versus hard power, and outline ways leaders exercise power and influence through political activity. Finally, we briefly consider some ethical aspects of using power and influence.

FOUR KINDS OF INFLUENTIAL LEADERSHIP New leaders often think of leadership power as something granted by an organiza- tion through the leader’s position. However, leaders also have power that doesn’t depend on job authority, and they influence people through a variety of means. Four types of influential leadership that rely on a leader’s personal style and rela- tionships are transformational, charismatic, coalitional, and Machiavellian-style leadership.

Transformational Leadership Transformational leadership is characterized by the ability to bring about significant change in both followers and the organization. Transformational leaders have the ability to lead changes in an organization’s vision, strategy, and culture as well as promote innovation in products and technologies.

One way to understand transformational leadership is to compare it to transac- tional leadership.2 The basis of transactional leadership is a transaction or exchange process between leaders and followers. The transactional leader recognizes followers’ needs and desires and then clarifies how those needs and desires will be satisfied in exchange for meeting specified objectives or performing certain duties. Thus, followers receive rewards for job performance, whereas leaders benefit from the completion of tasks. Transactional leaders focus on the present and excel at keeping the organization running smoothly and efficiently. They are good at traditional management functions such as planning and budgeting and generally focus on the impersonal aspects of job performance. Transactional leadership can be quite effective. However, because it involves a commitment to “follow the rules,” transactional leadership maintains stabil- ity within the organization rather than promoting change.

Transactional skills are important for all leaders. However, in a world in which success often depends on continuous change, organizations also need transforma- tional leadership.3 Rather than analyzing and controlling specific transactions with followers using rules, directions, and incentives, transformational leadership focuses

360 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Transformational leadership leadership characterized by the ability to bring about significant change in fol- lowers and the organization

Transactional leadership a transaction or exchange process between leaders and followers

on intangible qualities such as vision, shared values, and ideas in order to build relationships, give larger meaning to separate activities, and inspire people to partic- ipate in the change process. Transformational leadership is based on the personal values, beliefs, and qualities of the leader rather than on an exchange process between leaders and followers.

Studies support the idea that transformational leadership has a positive impact on follower development, performance, and even organizational profitability.4 More- over, transformational leadership skills can be learned as they are not ingrained personality characteristics. Transformational leadership differs from transactional leadership in four significant areas.5

1. Transformational leadership paints a grand vision of a desired future and com- municates it in a way that makes the pain of change worth the effort.6 The most significant role of the transformational leader may be to articulate a vision that is significantly better than the old one and to enlist others in sharing the dream. It is the vision that launches people into action and provides the basis for the other aspects of transformational leadership. Without vision, there can be no transformation.

2. Transformational leadership inspires followers to go beyond their own self- interests for the good of the group. Transformational leaders motivate people to do more than originally expected. They make followers aware of the impor- tance of change goals and outcomes and, in turn, enable them to transcend their own immediate interests for the sake of the whole organization.

3. Transformational leadership elevates the concerns of followers from lower-level physical needs (such as for safety and security) to higher-level psychological needs (such as for self-esteem and self-actualization). Lower-level needs are met through adequate wages, safe working conditions, and other considerations, but the transformational leader also pays attention to each individual’s need for growth and development. Therefore, the leader sets examples and assigns tasks not only to meet immediate needs but also to elevate followers’ needs and abili- ties to a higher level and link them to the organization’s mission.

4. Transformational leadership develops followers into leaders. Instead of strictly controlling people, transformational leaders strive to bring out the best in fol- lowers. They rally people around the mission and vision and define the bound- aries within which followers can operate with greater freedom to accomplish goals. They enlist followers in identifying problems and help them look at things in new ways so they can bring about productive change to reach the vision.

Effective leaders exhibit both transactional and transformational leadership patterns. They accentuate not only their abilities to build a vision and empower and energize others, but also the transactional skills of designing structures, control systems, and reward systems that can help people achieve the vision.7

Charismatic Leadership Charisma has been called “a fire that ignites followers’ energy and commitment, producing results above and beyond the call of duty.”8 Charismatic leaders have an emotional impact on people and inspire them to do more than they would normally do, despite obstacles and personal sacrifice. Their passion for a mission inspires people to follow them and motivates people to transcend their own interests for the sake of achieving the goal. Whereas transformational leadership seeks to

NEW LEADER ACTION MEMO As a leader, you can act like a transformational leader by ral- lying people around an inspir- ing vision, expressing optimism about the future, helping fol- lowers develop their potential, and empowering people to make change happen.

NEW LEADER ACTION MEMO Complete the questions in Leader’s Self-Insight 12.1 to learn how a supervisor of yours rates on transformational leadership. Then, answer the questions for how you would behave in a leadership situation.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 361

Charismatic leaders leaders who have the ability to inspire and motivate people to do more than they would normally do, despite obstacles and personal sacrifice

increase follower engagement and empowerment, charismatic leadership typically instills both awe and submission in followers.9 Transformational leadership moti- vates people not just to follow the leader personally but also to believe in the need for change and be willing to make sacrifices for the sake of the vision rather than just out of admiration for the leader.

Charisma can be used for good or ill, but applied wisely and ethically, it can lift the entire organization’s level of energy and performance. Although charisma itself cannot be learned, there are aspects of charismatic leadership that anyone can use. For one thing, charisma comes from pursuing activities that you have a true passion for.10 Char- ismatic leaders are engaging their emotions in everyday work life, which makes them energetic, enthusiastic, and attractive to others. For example, Sir Richard Branson, founder and chairman of Virgin Group, which includes about 400 companies, never gets involved in a new business unless it is something he has fun doing. His enthusiasm

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 12.1

Transformational Leadership

Instructions: Think of a situation where someone (boss, coach, teacher, group leader) was in a leadership position over you. Indicate whether each of the following items is Mostly False or Mostly True for you.

In general, the leader over me:

Mostly False

Mostly True

1. Listened carefully to my concerns 2. Showed conviction in his/her

values 3. Helped me focus on developing

my strengths 4. Was enthusiastic about our

mission 5. Provided coaching advice for my

development 6. Talked optimistically about the

future 7. Encouraged my self-development 8. Fostered a clear understanding of

important values and beliefs 9. Provided feedback on how I was

doing 10. Inspired us with his/her plans for

the future 11. Taught me how to develop my

abilities 12. Gained others’ commitment to

his/her dream

Scoring and Interpretation These questions represent two dimensions of transforma- tional leadership. For the dimension of develops followers

into leaders, sum your Mostly True responses to questions 1, 3, 5, 7, 9, and 11. For the dimension of inspires followers to go beyond their own self-interest, sum your Mostly True responses for questions 2, 4, 6, 8, 10, and 12.

The scores for my leader are:

Develops followers into leaders: Inspires followers to go beyond their own self-interest:

These two scores represent how you saw your leader on two important aspects of transformational leadership. A score of 5 or above on either dimension is considered high because many leaders do not practice transformational skills in their leadership or group work. A score of 2 or below would be below average. Compare your scores with other students to understand your leader’s practice of transformational leadership. How do you explain your leader’s score?

Remember, the important learning from this exercise is about yourself, not your leader. Analyzing your leader is sim- ply a way to understand the transformational leadership concepts. How would you rate on the dimensions of devel- oping followers into leaders or inspiring followers to go beyond their own self-interest? These are difficult skills to master. Answer the 12 questions for yourself as a leader. Analyze your pattern of transformational leadership as revealed in your 12 answers.

Sources: These questions are based on B. Bass and B. Avolio, Multifactor Leadership Questionnaire, 2nd ed. (Mind Garden Inc.) and P.M. Podsakoff, B. MacKenzie, R.H. Moorman, and R. Fetter, “Transformational Leader Behaviors and Their Effects on Followers, Trust in Leader Satisfaction, and Organizational Citizenship Behaviors,” Leadership Quarterly 1, No. 2 (1990), pp. 107–142.

NEW LEADER ACTION MEMO As a leader, you can use aspects of charismatic leadership by articulating a vision, making personal sacrifices to help achieve it, and appealing to people’s emotions more than to their minds. Expand your char- ismatic potential by pursuing activities that you genuinely love.

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rubs off on everyone around him.11 The late Steve Jobs, former CEO of Apple, who commanded a rock-star-like following and was more than once called “the model of a charismatic leader,” was intensely passionate about Apple and its products.12

A number of studies have identified the unique qualities of charismatic leaders, documented the impact they have on followers, and described the behaviors that help them achieve remarkable results.13 Exhibit 12.1 compares distinguishing char- acteristics of charismatic and noncharismatic leaders.14

Charismatic leaders articulate an idealized vision of a better future. They have an ability to communicate complex ideas and goals in clear, compelling ways, so that peo- ple understand and identify with their message. Charismatic leaders also act in uncon- ventional ways and use unconventional means to transcend the status quo and create change. The final quality shared by charismatic leaders is that their source of influence comes from personal characteristics rather than a formal position of authority. People admire, respect, and identify with the leader and want to be like him or her. Although charismatic leaders may be in formal positions of authority, charismatic leadership transcends formal organizational position because the leader’s influence is based on personal qualities rather than the power and authority granted by the organization.

Coalitional Leadership Transformational and charismatic leadership both suggest it is the individual leader who acts as a catalyst for bringing about valuable change toward achieving a goal or vision. Yet in most cases, successful change results from a coalition of people rather than the efforts of a single leader. Coalitional leadership involves building a coali- tion of people who support the leader’s goals and can help influence others to imple- ment the leader’s decisions and achieve the goals.15 Coalitional leaders observe and understand patterns of interaction and influence in the organization. They are skilled at developing connections with a broad network of people and can adapt their behavior and approach to diverse people and situations.

You can evaluate your potential for charismatic leadership by completing a short online questionnaire in CengageNOW.

EXHIBIT 12.1 Distinguishing Characteristics of Charismatic and Noncharismatic Leaders

Noncharismatic Leaders Charismatic Leaders

Likableness: Shared perspective makes leader likable

Shared perspective and idealized vision make leader likable and an honorable hero worthy of identification and imitation

Relation to status quo: Tries to maintain status quo Creates atmosphere of change

Future goals: Limited goals not too discrepant from status quo

Idealized vision that is highly discrepant from status quo

Articulation: Weak articulation of goals and motivation to lead

Strong and inspirational articulation of vision and motivation to lead

Behavior: Uses available means to achieve goals within frame- work of the existing order

Uses unconventional means to transcend the existing order

Influence: Primarily authority of position and rewards

Transcends position; personal power based on expertise and respect and admiration for the leader

Source: Adapted from Jay Conger and Rabindra N. Kanungo and Associates, Charismatic Leadership: The Elusive Factor in Organizational Effectiveness (San Francisco: Jossey-Bass, 1988), p. 91.

Coalitional leadership leadership that involves developing allies and build- ing a coalition of people who support the leader’s goals and can help influence others to implement the leader’s decisions and achieve the goals

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 363

Coalitional leaders develop positive relationships both within and outside the orga- nization, and they spend time learning others’ views and building mutually beneficial alliances. Coalition building seems to be especially important in the political arena. For example, Abraham Lincoln is considered by historians to be one of America’s greatest presidents partly because he listened carefully to a broad range of people both inside and outside of his immediate circle when the nation was so bitterly divided over the Civil War. He included people who didn’t agree with him and were critical of his goals and plans. On the other hand, some scholars have suggested that George W. Bush squandered his chance to be a great president when he failed to listen to a broad range of other people and involve them in decisions related to the Iraq War. The failure to reach out and build a coalition left the country deeply divided when Iraq became a quagmire, and Bush left office with the lowest poll ratings since opinion surveys of outgoing presidents began in the 1930s.16 As for President Barack Obama, the jury is still out on how his presidency will be evaluated. However, Obama has been criticized for failing to develop relationships with even his biggest donors and leaving the coalition building with Democrats on Capitol Hill and others to Vice President Joe Biden. Obama is widely viewed as a loner who prefers policy to people and consults primarily with a close circle of advisors, although some reports indicate that he does like to listen to a wide range of people when considering important decisions.17

Failing to build a coalition can allow conflict and disagreements to derail a lea- der’s decision, particularly if the opposition builds a powerful coalition of its own. Consider what happened when University of Virginia Rector Helen Dragas wanted to force President Teresa Sullivan to resign.

IN THE LEAD Helen Dragas and Teresa Sullivan, University of Virginia The showdown between the first female president and the first female rector of the University of Virginia played out over a period of 18 tumultuous days in front of a cast of thousands. “Pal- ace coup meets grassroots rebellion,” one politics professor tweeted at the peak of the drama.

Teresa Sullivan was shocked when she was told in a meeting with rector Helen Dragas and vice rector Mark Kington that the board was unhappy with her performance as president of the University of Virginia after two years on the job and they wanted her to resign. Presenting her with a separation agreement, Dragas informed Sullivan that they controlled 15 of the 16 board votes, so her departure was a foregone conclusion. How wrong she was. Dragas might have thought the board was on her side in the decision to oust Sullivan, but she hadn’t anticipated the backlash that would come from faculty and students, deans, alumni, former board members, donors, politicians, and other supporters of Sullivan. Dragas apologized for the way the resignation had been handled and tried to shore up support for her decision, but it was too late.

After two weeks of turmoil, Mark Kington resigned as vice rector and the governor of Virginia was threatening to fire the entire board if they didn’t resolve the crisis. Six board members were pushing for Sullivan’s reinstatement, five opposed it, and four votes were up for grabs. A week later, Dragas threw in the towel, stating that “It’s time to bring the U-Va family back together.” The vote to reinstate Sullivan was unanimous.18

Assuming she had the backing of the board, Helen Dragas failed to build an effective coalition to support her decision. Nor did she build a broader coalition of support with key players in the university community like Sullivan had. Indeed,

364 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

most board members might have supported her decision if there had not been such an outcry from the entire community. Managers always have to anticipate resis- tance, talk with people all across the organization, and make sure their decisions will benefit the overall organization.

Leaders can be more successful if they follow four steps for effective coalitional leadership:19

1. Coalitional leaders do lots of interviews. Leaders conduct informal interviews with people from all across the organization to gather information and get a clear sense of the challenges and opportunities they face. In addition to inter- views, leaders talk informally with people whenever they get a chance.

2. Coalitional leaders visit customers and other stakeholders. Coalitional leaders also solicit the views and input of customers as well as other potentially influ- ential stakeholders, such as board members, government agencies, creditors, or others. Jan Frank found that this was a big part of her job bringing change to California’s State Compensation Insurance Fund. When Frank took over, the agency was reeling from financial scandal, ethical violations, and a criminal investigation. In addition to talking with managers, employees, and board members, Frank also met regularly with lawmakers and regulators to solicit their input regarding how to repair the agency’s credibility. She knew their sup- port was crucial to achieving what she wanted for the agency.20

3. Coalitional leaders develop a map of stakeholder buy-in. Leaders typically find that there are some people who strongly support their goals and plans, some who adamantly oppose them, and a large percentage who could swing either way. As illustrated in Exhibit 12.2, in mapping the level of buy-in for any

EXHIBIT 12.2 Mapping Stakeholder Buy-In

Source: Data are adapted from materials supplied by ExperiencePoint, Inc., in conjunction with the GlobalTech simulation, 2007.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 365

significant change, about 10 percent of people can typically be classified as advocates, those stakeholders inside and outside the organization who are strong supporters and will help lead the change effort. Another 10 percent might be partners, who support and encourage the change but will not actively lead it. Twenty percent are typically strongly opposed to the change. These resisters might even disrupt or sabotage change efforts. The remaining 60 percent are classified as observers because they have a neutral attitude toward the proposed ideas and changes.21

4. Coalitional leaders break down barriers and promote cross-silo cooperation. The final critical step in coalitional leadership is continually breaking down barriers and promoting cooperation and collaboration across departments, divisions, and levels. For example, when Colin Powell was U.S. chairman of the Joint Chiefs of Staff, he regularly brought together the heads of the Army, Air Force, Navy, and Marines so they could understand one another’s viewpoints.22

Machiavellian-Style Leadership Niccolò Machiavelli was an Italian philosopher, historian, and political strategist who wrote The Prince in 1513 as a guide for political leaders of the day on how to acquire and use power.23 The term Machiavellian is often associated with unscrupulous, even diabolical behavior aimed at increasing one’s power for per- sonal gain, but in reality Machiavelli’s essential argument in The Prince is that the welfare of the state must come first and foremost and that leaders must often do tough, even ruthless things in the spirit of the ends justifying the means. In other words, power is a tool used for securing the safety and stability of the organization. Despite the emphasis today on agreeableness and collaboration, many organiza- tional leaders, scholars, and politicians agree with Machiavelli that it isn’t possible in an imperfect world to lead with “perfectly clean hands.”24

Jeffrey Pfeffer, Stanford University professor and an expert on organiza- tional power and politics, refers to the need for leaders to use bare-knuckle strategies to attain the clout they need to accomplish great things.25 As further described in the Bookshelf, Pfeffer believes that despite laudable personal achievements, power and politics almost always trump performance as a source of impact, so leaders had better be comfortable acquiring and using these tools. In today’s less-hierarchical organizations, leaders actually need more power than before to influence people. When Zia Yusuf, president and CEO of Streetline Inc., was an executive vice president at SAP, he advised and taught the people who worked for him how to court favor with the top 50 people in the company. Yusuf knew that having people in high places increases power and helps accomplish goals. Yusuf was in charge of an initiative that linked suppliers, users, and developers and had to influence many people that he had no formal authority over, not only from across SAP but from many different organizations. He says he succeeded because he was skilled at what he called “organizational dynamics”—the ability to influence people to get them to do what needed to be done.26

As discussed in the previous sections, many types of leadership are used to influence people. Each style—transformational, charismatic, coalitional, and Machiavellian—relies on different assumptions and behaviors. With Machiavellian- style leadership, the leader is willing to use any means necessary to preserve and protect

366 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

the well-being of the organization. The characteristics of Machiavellian-style leaders include the following:27

1. They are always on guard for risks and threats to their power. Machiavellian- style leaders assume that people are basically fickle, greedy, and deceitful, so the leader is always alert to shifting loyalties and is not above using manipula- tion or pitting people against one another to retain or acquire more power to achieve goals.

2. They don’t mind being feared. Machiavelli warned that striving to be the most- liked leader can backfire when difficult times call for tough actions. By being too merciful and generous, leaders can ultimately allow disorder to destroy the organization.

3. They will use deception if necessary. The Machiavellian-style leader has no problem maintaining or using power by deceptive means to ensure the safety of the organization.

4. They use rewards and punishments to shape behavior. Machiavellian-style lea- ders don’t mind exploiting the fears and desires of people to get them to follow the rules and do what is necessary for the overall good.

LEADER’S BOOKSHELF Power: Why Some People Have It and Others Don’t

by Jeffrey Pfeffer

Managers may be granted positions of authority, but real power doesn’t just fall into a person’s hands. It takes ambi- tion, resolve, energy, and skill to accu- mulate the power a leader needs to be effective and successful, Jeffrey Pfeffer says in Power: Why Some People Have It and Others Don’t. Think doing a good job gets you power? Think again. As Pfeffer puts it, “welcome to the real world—not necessarily the world we want, but the world that exists.”

POWER IN THE REAL WORLD To accumulate power, you need to get noticed. Here are some of Pfeffer’s tips for doing so.

• Play Up to the Boss. Pfeffer advises regularly asking people who have power what aspects of your job they think are most crucial and how they think you should be doing them. This is one tactic for making your boss and other people with power feel good about themselves. “The surest way to keep your position and to build a power base is to help those with more power enhance their positive

feelings about themselves.” In Pfeffer’s view, flattery really can get you everywhere.

• Master the Art of Networking. Try to forge a link between different parts of the company or between the company and important outsi- ders so that you become the center of a network. Build relationships with people that you can help and who can help you with information and resources. Playing the political game is necessary for acquiring power and getting things done.

• Be Forceful but Pick Your Battles Carefully. People who appear forceful and self-confident gain power, whereas those who seem uncertain fade away. Something as simple as interrupting others in a meeting expresses confidence. Pfeffer says Andy Grove of Intel used to insist that his brilliant but shy managers attend wolf school where they “learned how to lean into a superior’s face and shout out an idea or proposal.”

• Judiciously Break Some Rules. “The practice of flouting rules and

violating norms actually creates power, as long as the culprit gets away with the behavior,” says Pfeffer. The rules favor the people who make the rules—those who already have power, and they don’t always benefit those who want to acquire it.

IS THIS THE RIGHT WAY FOR A LEADER TO ACT? Pfeffer’s book has been criticized for failing to acknowledge that too much focus on obtaining power—and power itself—can be corrupting. Yet, as Pfeffer points out, without power lea- ders and organizations cannot hope to succeed. In addition, Pfeffer cites research showing that powerful people are wealthier, have more friends, enjoy a better quality of life, and even live longer, healthier lives. He offers this book as a how-to manual for getting and keeping power.

Source: Power: Why Some People Have It and Others Don’t, by Jeffrey Pfeffer, is published by HarperCollins.

NEW LEADER ACTION MEMO Do you have characteristics associated with Machiavellian- style leadership? Complete the questionnaire in Leader’s Self- Insight 12.2 to find out.

367 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Like coalitional leaders, Machiavellian-style leaders are highly political, but whereas coalitional leaders focus on reaching out and working with others, Machiavellian-style leaders typically focus on gaining and using individual power. They may strive to gain control over information and resources such as jobs, rewards, financial support, and materials so that people depend on them for what they need, which increases their power.28 These leaders may also use any means necessary to pre- serve their power, but they do so because they believe the organization can be secure only if it has powerful leaders. There are times in every organization when tough, even bare-knuckle leadership is needed. The following example describes how one woman says she used Machiavellian-style leadership to save her family.

IN THE LEAD The Evans Family Suzanne Evans was newly married, finishing a dissertation for her Ph.D. in history, and caring for four children under the age of 8. It was total chaos, but like many mothers dealing with blended families, Evans was trying to be kind and generous to the children. “Yet as I read

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 12.2

What’s Your Mach?

Instructions: Leaders differ in how they view human nature and the tactics they use to get things done through others. Answer the following questions based on how you view others. Think carefully about each question and be honest about what you feel inside. Please answer whether each item below is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. Overall, it is better to be humble and honest than to be successful and dishonest.

2. If you trust someone completely, you are asking for trouble.

3. A leader should take action only when it is morally right.

4. A good way to handle people is to tell them what they like to hear.

5. There is no excuse for telling a white lie to someone.

6. It makes sense to flatter impor- tant people.

7. Most people who get ahead as leaders have led very moral lives.

8. It is better to not tell people the real reason you did something unless it benefits you to do so.

9. The vast majority of people are brave, good, and kind.

10. It is hard to get to the top without sometimes cutting corners.

Scoring and Interpretation To compute your Mach score, give yourself one point for each Mostly False answer to items 1, 3, 5, 7, and 9, and one point for each Mostly True answer to items 2, 4, 6, 8, and 10. These items were drawn from the works of Niccolò Machiavelli, an Italian political philosopher who wrote The Prince in 1513 to describe how a prince can gain the power to protect and control his kingdom. From 8–10 points suggests a high Machiavellian score. From 4–7 points indi- cates a moderate score, and 0–3 points would indicate a low “Mach” score. Successful political intrigue at the time of Machiavelli was believed to require behaviors that today might be considered manipulative. A high Mach score today does not mean a sinister or vicious person but proba- bly means the person has a cool detachment, sees life as a game, and is not personally engaged with people. Discuss your results with other students, and talk about whether politicians in local or federal government, or top executives in a company like Bear Stearns, discussed in Chapter 6, would likely have a high or a low Mach score.

Source: Adapted from R. Christie and F. L. Geis, Studies in Machiavellianism (New York: Academic Press, 1970).

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The Prince,” she says, “I realized that the more things I gave them, the more they expected and the less grateful they became.”

Evans decided that a tough Machiavellian-style approach might be just what was needed to control the chaos that was threatening to tear her family apart. Here are some of the actions she took based directly on maxims she read in The Prince.

• Guard against a reputation for being too generous: On previous shopping trips, if she didn’t buy the children whatever they wanted, they would pitch temper tantrums. The next time they went to Target, she gave each one $10 and told them they could spend it on whatever they wanted but to use it wisely because it was all they were getting.

• Divide and conquer: To get her son Daniel to do better in school, Evans pitted him and her daughter Teddy in a not-so-friendly competition. When Teddy brought home a nearly perfect report card, she was rewarded with a celebratory dinner at her favorite restaurant. Daniel, whose report card wasn’t so good, got nothing except a reminder that he lost to his younger sister.

• Use punishment: Having children obey certain rules that ensure their safety is always important but even more so with a special needs child. When 5-year-old Katie, who has Down syndrome, kept trying to escape from the house unless she was watched con- stantly, Evans took action. She led her straight to her room and announced that when- ever she broke the rule, she would have to stay in her room for half an hour. “Every. Single. Time.”

• Be deceptive: Evans desperately needed a break, and she and her husband needed some time alone. To avoid the whining and crying that would ensue if the children weren’t allowed to go along, Evans told them “that their dad and I were going away for the weekend on a business trip. And I didn’t feel a bit guilty about it.”

The strategies worked. Shopping trips went much more smoothly, and the children learned the value of money. By the end of the school year, both Daniel and Teddy brought home excellent report cards. The tough approach with Katie kept her from trying to sneak out of the house and kept her safe. And Evans and her husband had a great weekend away while the children wore out their grandparents. “When I returned home, I was well-rested and relaxed … and having a happy, relaxed mom always benefits a child,” Evans says.29

Although Machiavellian-style leadership appears to be the approach most moti- vated to gain and use power, all leaders rely on the use of power to influence others and get things done.30 In the following sections, we examine various types of power and how leaders apply power through influence tactics.

USING HARD VERSUS SOFT POWER Power is often defined as the potential ability of one person to influence others to carry out orders31 or to do something they otherwise would not have done.32 Other definitions stress that power is the ability to achieve goals or outcomes that power holders desire.33 “Simply put, [power is] the ability to have things your way.”34

The achievement of desired outcomes is the basis of the definition used here. Power is the potential ability of one person in an organization to influence other people to bring about desired outcomes. It is the potential to influence others within the organization with the goal of attaining desired outcomes for power holders.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 369

Power the potential ability of one person to influence other people to bring about desired outcomes

Power can be categorized as either hard power or soft power. Hard power is power that stems largely from a person’s position of authority. This is the kind of power that enables a supervisor to influence subordinates with the use of rewards and punishments, allows a manager to issue orders and expect them to be obeyed, or lets a domineering CEO force through his or her own decisions without regard for what anyone else thinks. This is the approach to power typically taken by Machiavellian-style leaders. Transformational, charismatic, and coalitional leaders also use hard power, but they rely more often on soft power, which is based on personal characteristics and interpersonal relationships. Similarly, Machiavellian- style leaders also sometimes use soft power.

Power is realized through the processes of politics and influence.35 Influence refers to the effect a person’s actions have on the attitudes, values, beliefs, or actions of others. Whereas power is the capacity to cause a change in a person, influence may be thought of as the degree of actual change. For example, as a child you may have had the experi- ence of playing a game you didn’t really want to play because one person in the group influenced others to do what he or she wanted. Or you may have changed your college major because of the influence of someone important in your life, or shifted your beliefs about some social issue based on the influence of political or religious leaders.

Specific Types of Power Most discussions of power include five types that are available to leaders.36 Exhibit 12.3 illustrates the five types of leader power, categorized as either hard power or soft power. Hard power includes legitimate, reward, and coercive power, which are defined largely by the organization’s policies and procedures. However, it is important to remember that position power and leadership are not the same thing. As we discussed in Chapter 1, a person might hold a formal position of authority and yet not be a leader.

Effective leaders don’t rely solely on the hard power of their formal position to influ- ence others. Soft power includes expert power and referent power, as shown in the exhibit. In today’s world, soft power is, more than ever, the tool of the leader. Consider that Jeffrey Immelt, CEO of General Electric, considers himself a failure if he exercises his formal authority more than seven or eight times a year. The rest of the time, Immelt is using softer means to persuade and influence others and to resolve conflicting ideas and opinions.37 Even the United States military is talking about the importance of build- ing relationships rather than using brute force. Former Defense Secretary Robert Gates, for instance, says that in the battle for hearts and minds abroad, the United States has to be “good at listening to others” rather than just good at kicking down doors, and the Army’s new stability operations field manual openly talks about the value of soft power.38 Wesley Clark, former supreme commander of NATO who led the mission against Serb president Slobodan Milosevic, suggests that, for leaders in businesses as well as nations, building a community of shared interests should be the first choice rather than using threats, intimidation, and raw power.39

Each of the five types of leader power illustrated in Exhibit 12.3 is discussed in detail in the following paragraphs.

Legitimate Power Legitimate power is the authority granted from a formal position in an organization. For example, once a person has been selected as a supervisor, most employees accept that they are obligated to follow his or her direction with respect to work activities. Certain rights, responsibilities, and prerogatives accrue to anyone holding a formal leadership position. Followers accept the legitimate rights of formal leaders to set goals, make decisions, and direct activities.

370 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Influence the effect a person’s actions have on the attitudes, values, beliefs, or actions of others

Legitimate power authority granted from a formal position

Reward Power Power that stems from the authority to bestow rewards on other people is called reward power. For example, appointed leaders may have access to formal rewards, such as pay increases or promotions. Moreover, organizations allo- cate huge amounts of resources downward from top leaders. Leaders control resources and their distribution. Lower-level followers depend on leaders for the financial and physical resources to perform their tasks. Leaders with reward power can use rewards to influence subordinates’ behavior.

Coercive Power The opposite of reward power is coercive power. It refers to the power to punish or recommend punishment. Supervisors have coercive power when they have the right to fire or demote subordinates, criticize, or withdraw pay increases. For example, if a salesman does not perform as well as expected, the sales manager has the coercive power to criticize him, reprimand him, put a negative let- ter in his file, and hurt his chance for a raise. Coercive power is the negative side of legitimate and reward power.

Expert Power Power resulting from a leader’s special knowledge or skill regard- ing tasks performed by followers is referred to as expert power. When a leader is a true expert, subordinates go along with recommendations because of his or her

EXHIBIT 12.3 Five Types of Leader Power

Hard Power Soft Power

Legitimate: Based on leader holding a formal position or title. People accept leader’s right to issue orders or direct activities.

Expert: Based on leader’s special knowledge or skills. People trust and respect decisions because of leader’s expertise.

Reward: Based on leader having the ability to provide or withhold rewards. People comply in order to obtain desired rewards.

Referent: Based on leader’s personal character- istics. People admire and respect leader, like to be around him or her, and adopt the leader’s viewpoint.

Coercive: Based on leader’s ability to punish or to recommend punishment. People follow orders to avoid punishments.

NEW LEADER ACTION MEMO As a leader, you can expand your personal power by de- veloping good relationships and acquiring advanced knowledge and experience. You can use power to gain the commitment of others to achieve the vision. Use position power when appropriate, but don’t overdo it.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 371

Reward power authority to bestow rewards on other people

Coercive power authority to punish or rec- ommend punishment

Expert power authority resulting from a leader’s special knowledge or skill

superior knowledge. Based on one scholar’s research, leaders who are high in expert power are three times more influential than those without this type of power.40 Leaders at supervisory levels often have experience in the production process that gains them promotion. At top management levels, however, leaders may lack expert power because subordinates know more about technical details than they do. People throughout the organization with expertise and knowledge can use it to influence or place limits on decisions made by people above them in the organization.41

Referent Power This kind of power comes from leader personality characteristics that command followers’ identification, respect, and admiration so they want to emulate the leader. When workers admire a supervisor because of the way he or she deals with them, the influence is based on referent power. Referent power depends on the leader’s personal characteristics rather than on a formal title or position and is especially visible in the area of charismatic leadership. Consider the power of Patricia (Pattie) Sellers, who is the brains—and the brawn—behind Fortune magazine’s 50 Most Powerful Women rankings.

IN THE LEAD Patricia Sellers, Fortune Magazine She rubs elbows with Sheryl Sandberg, Indra Nooyi, and Warren Buffett. Never heard of her? Maybe that’s because she’s the one sometimes writing the splashy articles that are featured on the cover of Fortune magazine, rather than being the subject of them. Patricia Sellers, who is known as Pattie to friends, joined Fortune in 1984, two years out of college, and has been exploring power in her stories ever since. Over those years, she has also consistently expanded her own power based on expertise, relationships, and personal style.

“She is just unabashed in her hunt, her quest, for the perfect story,” said Sue Callaway, Sellers’s former editor. Sellers came up with the idea of ranking the most powerful women in 1998 and sold it to the higher-ups at Fortune, and to high-ranking women themselves, based on her enthusiasm and the credibility she had built with her journalism. A year later, a passionate desire to connect women and give them a chance to talk about the big busi- ness issues of the day led her to start the annual conference.

Known for being somewhat shy early in her career, Sellers now charms conference attendees as easily as if they are old friends (and by now, many of them are). “I get invited to a lot of things,” Warren Buffett said, “but this is the one I clear the calendar for.” At the 2011 conference, Buffett sat patiently waiting because a photographer wanted a shot of him with Sellers. Many people would have dropped everything to do the photo shoot, but part of Sellers’s power comes from treating everyone the same. She was busy with other guests. The “Oracle of Omaha” had to wait, just like anyone else would. He didn’t mind. “She gets together women that no one else has ever gotten together before,” he says. “And she makes you feel good about it.”42

Charismatic leadership, described earlier, is intensely based on the relationship between leader and followers and relies heavily on either referent or expert power. However, all good leaders make use of these types of power rather than using

372 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Referent power authority based on person- ality characteristics that command followers’ atten- tion, respect, and admiration so that they want to emulate the leader

position power alone. The Consider This box talks about the far-reaching impact of referent power.

Follower Responses to the Use of Power Leaders use the various types of power to influence others to do what is necessary to accomplish organizational goals. The success of any attempt to influence is a matter of degree, but there are three distinct outcomes that may result from the use of power: compliance, resistance, and commitment, as illustrated in Exhibit 12.4.43

When people successfully use hard, position power (legitimate, reward, coercive), the response is compliance. Compliance means that people follow

Consider The Ripple Effect

Do you want to be a positive influence in the world? First, get your own life in order. Ground yourself in this single principle so that your behavior is wholesome and effective. If you do that, you will earn respect and be a powerful influence.

Your behavior influences others through a ripple effect. A ripple effect works because everyone influences everyone else. Powerful people are powerful influences.

If your life works, you influence your family. If your family works, your family influences the community. If your community works, your community influences the nation. If your nation works, your nation influences the world. If your world works, the ripple effect spreads throughout the cosmos.

EXHIBIT 12.4 Responses to the Use of Power

Compliance following the directions of the person with power, regardless of how much agreement there is with that person’s directions

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 373

the directions of the person with power, whether or not they agree with those directions. They will obey orders and carry out instructions even though they may not like it. The problem is that in many cases, followers do just enough work to satisfy the leader and may not contribute their full potential. Recall our earlier definition of observers in the discussion of coalitional leadership. These people don’t actively resist or sabotage the leader’s efforts, but they don’t fully participate in achieving the vision. However, if the use of hard power, espe- cially the use of coercion, exceeds a level people consider legitimate, some followers will actively resist the attempt to influence. Resistance means that employees will deliberately try to avoid carrying out instructions or will attempt to disobey orders. Thus, the effectiveness of leaders who rely solely on position power is limited.

The follower response most often generated by soft, personal, and interpersonal power (expert, referent) is commitment. People become partners or advocates, rather than resisters or observers, as defined earlier. Commitment means that fol- lowers adopt the leader’s viewpoint and enthusiastically carry out instructions. Needless to say, commitment is preferred to compliance or resistance. Although compliance alone may be enough for routine matters, commitment is particularly important when the leader is promoting change. Change carries risk or uncertainty, and follower commitment helps to overcome fear and resistance associated with change efforts. Successful leaders exercise both personal and position power to influence others.

INCREASING POWER THROUGH POLITICAL ACTIVITY Acquiring and using power is largely a political process. Politics involves activities to acquire, develop, and use power and other resources to obtain desired future out- comes when there is uncertainty or disagreement about choices.44 Politically skillful leaders strive to understand others’ viewpoints, needs, desires, and goals, and use their understanding to influence people to act in ways that help the leader accom- plish his or her goals for the team or organization.45

For example, leaders at most organizations engage in some degree of political activity aimed at influencing government policies and decisions because government choices represent a critical source of uncertainty for businesses as well as nonprofit organizations.46 Consider BAE Systems, where leaders have launched a lobbying campaign along with dozens of the company’s suppliers to reverse Pentagon deci- sions that will cut military spending for production of BAE’s Bradley line of fighting vehicles.47

Individuals also engage in political activity within organizations. Although some people have a negative view of politics, the appropriate use of political behav- ior serves organizational goals. Politics is a natural process for resolving differences among organizational interest groups.48 Political behavior can be either a positive or negative force. Uncertainty and conflict are natural in organizations, and politics is the mechanism for accomplishing things that can’t be handled purely through for- mal policies or position power.

Leader Frames of Reference The appropriate use of power and politics to get things done is an important aspect of leadership. Before exploring political tactics, let’s consider leadership frames of reference and how a political approach combines with other leadership philosophies.

Power is of two kinds. One is

obtained by the fear of punish- ment and the

other by acts of love. Power based

on love is a thousand times more effective

and permanent than the one

derived from fear of punishment.

Mahatma Gandhi

374 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Resistance the act of disobeying orders or deliberately avoiding carrying out instructions

Commitment adopting the leader’s view- point and enthusiastically carrying out instructions

Politics activities to acquire, develop, and use power and other resources to obtain desired future outcomes when there is uncertainty or disagree- ment about choices

A frame is a perspective from which a leader views the world, and it influences how the leader interacts with followers, makes decisions, and exercises power. Four leader frames of reference illustrated in Exhibit 12.5 are structural, human resource, political, and symbolic.49 Leaders often begin with a limited structural perspective and develop the other frames as they mature and climb higher in their leadership development, thus achieving a more balanced mindset and approach.

The Structural Frame The organization as a machine is the dominant image in the structural frame of reference. Leaders strive for machine-like efficiency and value hard data and analysis for decision making. The structural frame places emphasis on plans, goal setting, and clarifying expectations as a way to provide order, efficiency, and stabil- ity. Leaders rely heavily on the power and authority granted through their organizational position to influence others (position power), and they emphasize clear job descriptions, rules and procedures, and administrative systems. This frame views the organization as a rational system and strives for clarity of direction and control of results.

The Human Resource Frame According to the human resource frame, people are the organization’s most valuable resource. This frame defines problems and issues in interpersonal terms and looks for ways to adjust the organization to meet human needs. Leaders do not rely solely on their position power to exert influence. Instead, they focus on relationships and often lead through empowerment and engagement. Leaders use the human resource perspective to involve followers and give them opportunities for personal and professional development. The images in this view are a sense of family, belonging, and the organization as a clan.

The Political Frame The political frame views organizations as arenas of ongoing conflict or tension over the allocation of scarce resources. Leaders spend their time networking and building coalitions to influence decisions and actions. As with the coalitional leadership style we discussed earlier in this chapter, leaders with this

EXHIBIT 12.5 Four Leader Frames of Reference

Sources: Based on Lee G. Bolman and Terrence E. Deal, Reframing Organizations (San Francisco: Jossey-Bass, 1991); and L. G. Bolman and T. E. Deal, “Leadership and Management Effectiveness: A Multi-Frame, Multi-Sector Analysis,” Human Resource Management 30, no. 4 (Winter 1991), pp. 509–534. Thanks to Roy Williams for suggesting the stair sequence.

NEW LEADER ACTION MEMO Use each of the structural, human resource, political, and symbolic frames of reference to maximize your leadership effectiveness. Complete the questionnaire in Leader’s Self- Insight 12.3 to understand your dominant frame.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 375

Frame a perspective from which a leader views the world; in- fluences how the leader in- teracts with followers, makes decisions, and exercises power

Structural frame a leader frame of reference that places emphasis on planning, setting goals, and clarifying expectations as a way to provide order, effi- ciency, and stability

Human resource frame a leader frame of reference that defines problems and issues in interpersonal terms and looks for ways to adjust the organization to meet human needs

Political frame a leader frame of reference that views the organization as an arena of conflict or tension over the allocation of scarce resources

frame of reference strive to build a power base, and they use both position and per- sonal power to achieve desired results. The mindset in the political frame is to be aware of the organization as a jungle. Power and politics are considered a natural and healthy part of organizational life.

The Symbolic Frame To use full leadership potential requires that leaders also develop a fourth frame of reference—the symbolic frame—in which leaders perceive the organization as a system of shared meaning and values. Rather than relying only on the use of formal power or the use of political tactics, leaders focus on shared vision, culture, and values to influence others. The dominant image is to

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C a CLEADER’S SELF-INSIGHT 12.3

Your Leadership Orientation

Instructions: This questionnaire asks you to describe yourself as a leader. For each of the following items, give the number “4” to the phrase that best describes you, “3” to the item that is next best, and on down to “1” for the item that is least like you.

1. My strongest skills are: a. Analytical skills b. Interpersonal skills c. Political skills d. Flair for drama

2. The best way to describe me is: a. Technical expert b. Good listener c. Skilled negotiator d. Inspirational leader

3. What has helped me the most to be successful is my ability to:

a. Make good decisions b. Coach and develop people c. Build strong alliances and a power base d. Inspire and excite others

4. What people are most likely to notice about me is my: a. Attention to detail b. Concern for people c. Ability to succeed in the face of conflict and

opposition d. Charisma

5. My most important leadership trait is: a. Clear, logical thinking b. Caring and support for others c. Toughness and aggressiveness d. Imagination and creativity

6. I am best described as: a. An analyst b. A humanist c. A politician d. A visionary

Scoring and Interpretation Compute your scores as follows:

Structural 1a 2a 3a 4a 5a 6a

Human Resource 1b 2b 3b 4b 5b 6b

Political 1c 2c 3c 4c 5c 6c

Symbolic 1d 2d 3d 4d 5d 6d

Your answers reveal your preference for four distinct leader orientations or frames of reference. The higher your score, the greater your preference. A low score may mean a blind spot. “Structural” means to view the organization as a machine that operates with efficiency to be successful. “Human Resource” means to view the organization primar- ily as people and to treat the family well to succeed. “Polit- ical” means to view the organization as a competition for resources and the need to build alliances to succeed. “Sym- bolic” means to view the organization as a system of shared meaning and values and to succeed by shaping the culture.

Do you view politics in a positive or negative light? Most new leaders succeed first by using either or both of the structural or people orientations. New leaders often have a blind spot about politics. As managers move up the hierarchy, they learn to be more political or they miss out on key decisions. The symbolic view usually comes last in a leader’s development. Compare your scores to other students and see which orientations are more widely held.

| D re am

st im e. co m

376

Symbolic frame a leader frame of reference that perceives the organiza- tion as a system of shared meaning and focuses on shared vision, culture, and values to influence others

see the organization as theater. Leaders are concerned with spirit and meaning, and they focus on harnessing followers’ dreams and emotions for the benefit of the organization and all of its people.

Each of the four frames of reference provides significant possibilities for enhancing leadership effectiveness, but each is incomplete. Many new leaders have not yet developed a political frame. Leaders can first understand their own natural frame, recognize its limitations, and then learn to integrate multiple frames to achieve their full leadership potential.

Political Tactics for Asserting Leader Influence A leader’s power is useless unless it is applied to influence others to implement deci- sions, facilitate change, and accomplish goals, which requires both skill and willing- ness. Not all attempts to use power result in actual influence. Some power moves are rejected by followers, particularly if they are seen to be self-serving. Leaders have to determine the best approach for using their power—that is, the approach that is most likely to influence others—by considering the individuals, groups, and situations involved.50 In addition, they understand the basic principles that can cause people to change their behavior or attitudes.

Leaders frequently use a combination of influence strategies, and people who use a wider variety of tactics are typically perceived as having greater power and influence. One survey of a few hundred leaders identified more than 4,000 different techniques by which these people were able to influence others to do what the leader wanted.51

However, the myriad successful influence tactics used by leaders fall into basic catego- ries of influence actions. Exhibit 12.6 lists six principles for asserting leader influence. Notice that most of these involve the use of soft, personal power rather than relying solely on hard, position power or the use of rewards and punishments.

1. Appeal to a vision or higher purpose. One effective way to attract people to new behaviors or to make significant changes is to frame the request in a way that emphasizes the vision or higher purpose of the change.52 Providing people with

EXHIBIT 12.6 Six Principles for Asserting Leader Influence

20 15

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 377

meaning can help them see that the effort of doing what you ask is worthwhile. For example, Matt Van Vranken, president of Spectrum Health Hospital Group, needed a way to influence 10,000 overworked, stressed-out health-care professionals to go beyond their job descriptions and provide exceptional patient service. One key approach he uses to influence people to make the right decision is to connect what they do to the welfare of individual patients. Every so often, Van Vranken brings groups of employees together to hear former patients talk about their experiences and how the actions of individual workers affected their health and well-being.53

2. Use rational persuasion. Perhaps the most frequently used influence tactic is rational persuasion, which means using facts, data, and logical arguments to per- suade others that a proposed idea or request is the best way to complete a task or accomplish a desired goal. It can be effective whether the influence attempt is directed upward toward superiors, downward toward subordinates, or horizon- tally, because most people have faith in facts and analysis.54 Rational persuasion is most effective when a leader has technical knowledge and expertise related to the issue (expert power), although referent power is also used. Frequently, some parts of a rational argument cannot be backed up with facts and figures, so peo- ple have to believe in the leader’s credibility to accept his or her argument.

3. Help people to like you. We all know it’s easier to say yes to someone we like than to someone we don’t like.55 One author of a book on influence tells a story about an American working in Saudi Arabia, who learned that getting informa- tion or action from government offices was easy when he’d drop by, drink tea, and chat for awhile.56 Cultural values in Saudi Arabia put great emphasis on personal relationships, but people in all cultures respond to friendliness and con- sideration. When a leader listens, shows concern for what others want and need, finds common ground, demonstrates respect, and treats people fairly, people are more likely to want to help and support the leader by doing what he or she asks. In addition, most people will like a leader who makes them feel good about themselves. Leaders never underestimate the importance of praise.

4. Rely on the rule of reciprocity. A primary way to turn power into influence is to share what you have—whether it be time, resources, services, or emotional sup- port. There is much research indicating that most people feel a sense of obligation to give something back in return for favors others do for them.57 This is one rea- son that organizations like Northrup Grumman, Kraft Foods, and Pfizer make donations to the favorite charities of House and Senate members. Leaders attempt to curry favor with lawmakers whose decisions can significantly affect their busi- ness.58 The “unwritten law of reciprocity” means that leaders who do favors for others can expect others to do favors for them in return. Leaders also elicit the cooperative and sharing behavior they want from others by first demonstrating it with their own actions.59 Some researchers argue that the concept of exchange— trading something of value for what you want—is the basis of all other influence tactics. For example, rational persuasion works because the other person sees a benefit from going along with the plan, and making people like you is successful because the other person receives liking and attention in return.60

5. Develop allies. Reciprocity also plays an important role in developing networks of allies, people who can help the leader accomplish his or her goals. Leaders can influ- ence others by taking the time to talk with followers and other leaders outside of formal meetings to understand their needs and concerns, as well as to explain pro- blems and describe the leader’s point of view.61 Leaders consult with one another and reach a meeting of minds about a proposed decision, change, or strategy.62 A

NEW LEADER ACTION MEMO As a leader, you can use political activity to achieve important organizational goals when there is uncertainty or disagreement about choices. You can develop connections with powerful people by volunteering for difficult projects and serving on committees.

378 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

leader can expand his or her network of allies by reaching out to establish contact with additional people. Some leaders expand their networks through the hiring, transfer, and promotion process. For example, Michael Corbat, the new CEO of Citigroup, has asked some of the former CEO’s top allies to resign and has reduced the responsibilities of others so he can put his own trusted advisors in key roles.63

Identifying and placing in key positions people who are sympathetic to the desired outcomes of the leader can help achieve the leader’s goals.

One study found that political skill, particularly network building, has a positive impact on both followers’ perceptions of a leader’s abilities and perfor- mance as well as on the actual, objective performance of the work unit.64 Sheila Bair, former chairman of the Federal Deposit Insurance Corporation (FDIC), enhanced her reputation and power base by courting allies to support her views on how to fix the troubled U.S. financial system. Her efforts also expanded the agency’s power. Under her leadership, the FDIC gained broad new powers to police large financial institutions, including installing examiners at financial firms to monitor managers’ activities.65

6. Ask for what you want. Sheila Bair also employs another technique for influencing people, which is to be clear about what you want and openly ask for it. Leaders have to be willing to sometimes argue forcefully to persuade others to their point of view. Even opponents praise Bair’s knack for being forceful at the right times in order to achieve her goals. If leaders are not willing to ask and persuade, they sel- dom get the results they want. Political activity is effective only when the leader’s vision, goals, and desired changes are made explicit so the organization can respond. Leaders can use their courage to be assertive, saying what they believe to persuade others. In addition, leaders can use techniques of persuasion such as listening, build- ing goals on common ground, and appealing to people’s emotions, as described in Chapter 9, to get what they want. Machiavellian-style leaders may even manipulate people’s emotions, such as activating peer pressure or phrasing a request in a way that emphasizes the potential loss rather than the potential gain. People will often go along with the request because people respond more strongly to a potential loss (loss aversion) than to a gain, as described in Chapter 8.66

Leaders can use an understanding of these tactics to assert influence and get things done. When leaders ignore political tactics, they may find themselves failing without understanding why. For example, at the World Bank, Paul Wolfowitz tried to wield power without building the necessary relationships he needed to assert influence.

IN THE LEAD Paul Wolfowitz, World Bank After former Deputy Secretary of Defense Paul Wolfowitz lost his bids to become defense secretary or national security advisor in the Bush administration, he jumped at the chance to be the new president of World Bank. But Wolfowitz doomed his career at World Bank from the start by failing to develop relationships and build alliances.

Most World Bank leaders had been in their positions for many years when Wolfowitz arrived, and they were accustomed to “promoting each other’s interests and scratching each other’s backs,” as one board member put it. Wolfowitz came in and tried to assert his own ideas, goals, and formal authority without considering the interests, ideas, and goals of others. He quickly alienated much of the World Bank leadership team and board by

NEW LEADER ACTION MEMO As a leader, you can influence others by using rational per- suasion, developing allies, and expanding your expertise and credibility. Remember that people respond to friendliness and consideration, and they typically feel obligated to return favors.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 379

adopting a single-minded position on key issues and refusing to consider alternative views. Rather than attempting to persuade others to his way of thinking, Wolfowitz issued direc- tives to senior bank officers, either personally or through his handpicked managers. Several high-level officers resigned following disputes with the new president.

Eventually, the board asked for Wolfowitz’s resignation. “What Paul didn’t understand is that the World Bank presidency is not inherently a powerful job,” said one former colleague. “A bank president is successful only if he can form alliances with the bank’s many fiefdoms. Wolfowitz didn’t ally with those fiefdoms. He alienated them.”67

Wolfowitz realized too late that he needed to use a political approach rather than trying to force his own agenda. Even when a leader has a great deal of power, politi- cal tactics are more effective than force for turning power into influence.

DON’T TAKE POWER PERSONALLY Harry Truman once said that leadership is the ability to get people to do what they don’t want to do and like it.68 His statement raises an important issue: Leadership is an opportunity to use power and influence to accomplish important organiza- tional goals, but power can also be abused. People and organizations get hurt when leaders fall into the temptation to use power for their own benefit rather than for the good of the whole.

One consideration is the difference between personalized leaders and socialized leaders.69 This distinction refers primarily to the leader’s approach to the use of power.70 Personalized leaders are typically selfish, impulsive, and exercise power for their own self-centered needs and interests rather than for the good of the orga- nization. Socialized leaders exercise power in the service of higher goals that will benefit others and the organization as a whole. Personalized leaders are character- ized as self-aggrandizing, nonegalitarian, and exploitative, whereas socialized lea- ders are empowering, egalitarian, and supportive. Personalized behavior is based on caring about self; socialized behavior is based on valuing others.

A specific area in which the unethical use of power is of increasing concern for organizations is sexual harassment. People in organizations depend on one another— and especially on leaders—for many resources, including information, cooperation, and even their jobs. When access to resources seems to depend on granting sexual favors or putting up with sexually intimidating or threatening comments, the person in a dependent position is being personally violated, whether or not the leader actually withholds the resources. Consider the U.S. military, which is embroiled in a nasty sex- ual harassment and abuse scandal. In May 2013, the Pentagon released an embarras- sing and shameful report detailing pervasive sexual abuse in the military, estimating a rate of about 500 men and women assaulted each week during 2012. Although many of these are assaults by fellow soldiers, some are also by officers. For example, an Army officer in charge of sexual abuse prevention at Fort Hood, Texas, is under investigation for allegedly assaulting two soldiers and forcing another into prostitu- tion. Moreover, statistics show that the system of military justice perpetuates the crime. Commanding officers often decide to dismiss charges or decrease penalties. Two Air Force three-star generals recently tossed out jury convictions for sexual assault, in one instance saying the defendant couldn’t possibly be guilty because he

NEW LEADER ACTION MEMO As a leader, you can be ethical in your use of power and pol- itics. You can build long-term productive relationships to achieve important goals and benefit the entire team or organization.

380 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

was “a doting father and husband.”71 Sexual harassment and sexual abuse are not just unethical; they are illegal and represent a clear abuse of power.

However, there are many other situations in organizations that are not so clear- cut, and leaders may sometimes have difficulty differentiating ethical from unethical uses of power and politics. Exhibit 12.7 summarizes some criteria that can guide eth- ical actions. First and foremost is the question of whether the action is motivated by self-interest or whether it is consistent with the organization’s goals. One Internet company has a rule that any employee can be terminated for a political act that is in the individual’s own self-interest rather than in the interest of the company or that harms another person in the organization.72 Once a leader answers this primary question, there are several other questions that can help determine whether a poten- tial influence action is ethical, including whether it respects the rights of individuals and groups affected by it, whether it meets the standards of fairness, and whether the leader would want others to behave in the same way. If a leader answers these questions honestly, they can serve as a guide to whether an intended act is ethical.

In the complex world of organizations, there will always be situations that are difficult to interpret. The most important point is for leaders to be aware of the eth- ical responsibilities of having power and take care to use their power to help rather than harm others. Leaders should think not in terms of getting their own way but rather in terms of building long-term productive relationships that can achieve goals and benefit the entire organization.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • This chapter looked at how leaders use power and political processes to influ-

ence others and get things done. Four types of influential leadership that rely strongly on a leader’s personal characteristics and relationships are transforma- tional, charismatic, coalitional, and Machiavellian-style leadership. Charismatic leaders have an emotional impact on people. They create an atmosphere of change, articulate an idealized vision of the future, inspire faith and hope, and frequently incur personal risks to influence followers. Transformational leaders also create an atmosphere of change, and they inspire followers not just to

EXHIBIT 12.7 Guidelines for Ethical Action

Sources: Based on G. F. Cavanaugh, D. J. Mobert, and M. Valasques, “The Ethics of Organizational Politics,” Academy of Management Journal, (June 1981), pp. 363–374; and Stephen P. Robbins, Organizational Behavior, 8th ed. (Upper Saddle River, NJ: Prentice Hall, 1998), p. 422.

Tw itt er

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 381

follow them personally but also to believe in the vision. Transformational leaders inspire followers to go beyond their own self-interest for the good of the whole. Coalitional leadership involves developing a coalition of people who can help influence others to implement the leader’s decisions and achieve the leader’s desired goals. To have broad influence, leaders develop relationships with others, listen to others’ needs and goals, and promote cooperation. Machiavellian-style leadership is based on the belief that leaders must often do tough, even ruthless, things in the spirit of protecting the organization. Machiavellian leaders focus on acquiring individual power more than on collaborating with others.

• All leaders use power and politics to influence people and accomplish goals. Power is the ability to influence others to reach desired outcomes. Power can be characterized as either hard power or soft power. Hard power includes legit- imate, reward, and coercive power, which are associated with a leader’s formal position of authority. Soft power includes expert and referent power, which are based on the leader’s knowledge, expertise, and personal qualities. Three dis- tinct outcomes may result from the use of power: compliance, resistance, and commitment. The effective use of hard, position power generally leads to fol- lower compliance, whereas the excessive use of position power—particularly coercive power—may result in resistance. The follower response most often generated by personal power is commitment.

• Power is acquired, developed, and exercised through political activities. Having a political perspective on the organization is important because leaders need to use politics to accomplish important goals. A political perspective can be combined with other leader frames of reference. Frames of reference influence how the leader interacts with followers, makes decisions, and exercises power. Four leader frames of reference are structural, human resource, political, and symbolic. Lea- ders typically begin with a structural frame and develop other frames of reference as they mature in their leadership responsibilities and understanding.

• Leaders use a wide variety of influence tactics, but they fall within some broad categories based on general principles for asserting influence. Six principles for asserting leader influence are appeal to a higher vision, rational persuasion, lik- ing and friendliness, reciprocity, developing allies, and direct appeal. One important consideration for leaders is how to use power and politics ethically and responsibly. Ethical leaders use power to serve the organization’s goals, respect the rights of individuals and groups, and strive to be fair in their deal- ings with others.

DISCUSSION QUESTIONS 1. Lord Acton, a British historian of the late nineteenth century, said that “power tends to

corrupt; absolute power corrupts absolutely,” suggesting that a person’s sense of moral- ity lessens as his or her power increases. Do you agree? Considering this idea, is it ethi- cal for leaders to try to increase their power? Discuss.

2. How do you feel about personally using Machiavellian-style leadership? What do you see as some positive and negative aspects of Machiavellian-style leadership?

3. What do you consider the most important difference between transformational leader- ship and transactional leadership? Between transformational and charismatic leader- ship? How is transformational leadership similar to charismatic leadership?

382 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

4. Assume you are on a search committee to replace the CEO of a large financial services firm that is recovering from problems related to the mortgage crisis. Which do you think would be more valuable for a new top leader trying to solve the problems within the organization—charismatic, transformational, coalitional, or Machiavellian-style leadership? What about for a new top leader of a small private university? Discuss.

5. Which of the four organizational frames of reference do you most admire? How do you think this frame of reference could be beneficial or detrimental to your leadership capability?

6. A recent magazine article suggested that young college graduates just entering the work- force are refusing to “play the political game.” Why might this be the case? If politics is important for getting things done, can these people succeed as leaders? Discuss.

7. Which types of power would you rely on to implement an important decision quickly? Which types would you consider most valuable for sustaining power over the long term?

8. Describe ways in which you might increase your personal power.

9. Which of the six influence tactics would you be most comfortable with as leader of a study group? Of a work team? Discuss.

10. A leadership observer said in an interview that most women leaders view power differently than men do and prefer a collaborative, relationship-oriented use of power. If this is the case, what does it suggest about women leaders’ abilities to accomplish goals? What does it suggest about women’s ability to rise to higher organizational levels? Discuss.

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C a C

LEADERSHIP AT WORK Circle of Influence How do you personally try to influence others? Think carefully about how you get others to agree with you or do something you want. Watch the way you influence others in a team, at home, or during your work. Make a list of your influence tactics:

1. 4.

2. 5.

3. 6.

Of the influence and political tactics discussed in the chapter, which ones do you typi- cally not use?

During the next two days, your assignment is to (1) monitor the influence tactics you typically use and (2) try one new tactic that you don’t normally use. The new influence tactic you will try is:

Another important concept is called the circle of influence. Think carefully about the people who have influence over you. These people are your circle of influence. You may

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 383

have one circle of influence at work, another at home, and others for your social life or career. Write down the people who would have some influence over you at work or school:

This is your circle of influence.

A person’s circle of influence can be important when you really want to influence that per- son. If someone doesn’t respond to your normal influence attempts, think about identifying the individual’s circle of influence—the people who have influence over him or her. You can then influence people in the “circle” as an indirect way to influence the person you want to change.

Pick an individual at work or school, or even your instructor, and plot out that person’s circle of influence. List the key people you believe are in the person’s circle of influence:

How would you get more information on the person’s true circle of influence?

How can you use your knowledge of the person’s circle to have influence over him or her? What are the possible disadvantages of using this approach to influence someone?

In Class: The instructor can ask students to sit in small groups of three to five people and share the circles of influence they identified for themselves. After listing the circle of influence at work or school, students can also talk about the circles of people who might influence them in their professional, social, or family activities. Key questions for this discussion are, What are the common themes in the students’ circles of influence? When and how could the circle idea be applied to influence someone? How might it be misapplied and backfire on your effort to influence another?

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C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS The Suarez Effect Pat Talley stood and watched, with grudging admiration, as Carmelita Suarez worked the room. Sharp, charming, and armed with a personality that left an indelible memory, Carme- lita at one moment had the ear of CEO Chris Blount and the next could be observed smiling and studying something on her electronic notebook with the executive assistant of a major board member.

“She’s amazing,” Kent Schlain whispered to Pat as he gave him a cocktail. “I like to observe and learn. She’s a real education in office politics.”

“We’re not in politics,” Pat answered somewhat defensively. “We’re in IT.” “Come on, Pat.” Kent teased. “Tell me she doesn’t worry you. Everyone knows she’s

your main competition for the CIO job.” Pat smirked, took a sip from his scotch and water, and said sarcastically, “I’m worried.

Satisfied?”

384 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

Walking away from Kent’s mischievous goading, Pat’s usual confidence suffered a fleet- ing twinge of fear. No. I’m OK. I’m OK, he thought. I have more expertise than anyone, including Carmelita, and I’m not afraid to lay down the law to get projects completed.

After weeks of speculation, interviews, on-site visits by top execs, and endless waiting, a decision on the new CIO was to be made and announced by CEO Blount this week during the annual meeting. Although Mansfield, Inc. boasted an extraordinarily talented IT group, company insiders and industry watchers agreed that the decision would come down to a choice between Carmelita Suarez and Pat Talley.

To this point, Pat carried the confidence of a sterling 20-year record with Mansfield. Tech- nically gifted, he was one of the team members that designed and implemented the company’s original IT system and had been a major player throughout the years in guiding its growth and expansion. Task oriented almost to a fault, Pat built a reputation as a guy who relentlessly ana- lyzed needs and then charged ahead until the job was completed—usually under budget. His special strength lay in the twin areas of electronic security and risk management.

Pat considered technical expertise and competence to be the qualifications for the position as CIO, as he explained during a recent interview with executives and board members. “Our work and reputation should be the only considerations,” Pat emphasized. “My job is not to schmooze and glad hand. I’m not running for public office. I’m running an IT division.”

Over the years, Pat maintained strictly defined areas of work and friendship and, in fact, could count on one hand the number of casual, work-related friendships he had devel- oped over 20 years. He was proud of his ability to compartmentalize these areas so that per- sonal relationships had no bearing on management decisions. He considered this an important part of his reputation as a fair but tough leader. He demanded excellence and could be unforgiving in his attitude toward those with less technology interest or expertise.

The word politics was odious to Pat Talley, and he considered office politics a waste of time. However, at company gatherings such as this, he also carried a slight chip on his shoul- der, aware that, despite his importance to the company, he was only on the periphery of this group—not excluded, but not really included either. The significance of this particular meet- ing—and now watching Suarez put on a clinic in office politics—only increased those feel- ings for Pat, making him defensive and uncharacteristically concerned about his future.

Could office politics really be the deciding factor, he suddenly wondered. Carmelita knows her stuff. She does her research and stays on top of the latest trends and products in IT. She can handle any situation, particularly those sticky people problems that arise within teams or with suppliers. Pat smiled ruefully. Heck, I’ve even brought her in a time or two.

Now, as he stood and observed the activity in the room, he watched as his rival moved effort- lessly among individuals and various groups. I feel like I’m watching ‘Survivor.’ Does the guy who trusts his own abilities win, or is it the one who builds coalitions and alliances? He shook his head as if to shake off the imagery. That was stupid. This is not a reality television show. This is corpo- rate America. Do your job. I’ve built my reputation on that, and I’ll stand by that.

His attention snapped back as Carmelita handed him a fresh scotch and water. “You could use a fresh one,” she said, smiling and pointing to his empty glass. “I guess tomor- row’s the big day and I wanted to come by and wish you well. These are exciting days for the company and for IT, and whichever way it goes tomorrow I look forward to working together. Cheers.”

“Same here,” he answered. Their glasses clinked together in a toast. Dang, she’s good, Pat thought.

DISCUSSION QUESTIONS:

1. Who do you think the CEO should appoint as CIO? Why?

2. Is Pat sabotaging his career by thinking of relationship building as “office politics” that takes the focus away from day-to-day work? What advice would you give Pat, who is not a natural relationship builder?

3. What sources of power do Pat and Carmelita seem to use in the company? Which per- son do you believe will be more influential as CIO? Explain.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 385

Waite Pharmaceuticals Amelia Lassiter is chief information officer at Waite Pharmaceuticals, a large California- based company. In an industry where it generally takes $500 million and 10 to 12 years to bring a new drug to market, companies such as Waite are always looking for ways to increase productivity and speed things up. After about eight months on the job, Lassiter sug- gested to company president James Hsu that Waite implement a new global knowledge- sharing application that promises to cut development time and costs in half. She has done extensive research on knowledge-sharing systems and has talked closely with an IT director at global powerhouse Novartis, a company on the cutting edge in pharmaceuticals and ani- mal health care, as well as other diverse products. The Novartis director believes the knowledge-sharing system plays an important role in that company’s competitiveness.

Hsu presented the idea to the board of directors, and everyone agreed to pursue the project. He has asked Lassiter to investigate firms that could assist Waite’s IT department in developing and implementing a global knowledge-sharing application that would be com- patible with Waite’s existing systems. Hsu explained that he wants to present the informa- tion to the board of directors for a decision next month.

Lassiter identified three major firms that she believed could handle the work and took a summary of her findings to Hsu’s office, where she was greeted by Lucy Lee, a young, petite, attractive woman who served as a sort of executive assistant to Hsu. Word was that the rela- tionship between Lee and Hsu was totally proper, but besides the value of her good looks, no one in the company could understand why she was working there. Her lack of talent and experience made her a liability more than a help. She was very deferential to Hsu but condescending to everyone else. Lee was a constant source of irritation and ill will among managers throughout the company, but there was no doubt that the only way to get to Hsu was through Lucy Lee. Lee took the information from Lassiter and promised the president would review it within two days.

The next afternoon, Hsu called Lassiter to his office and asked why Standard Systems, a small local consulting firm, was not being considered as a potential provider. Lassiter was surprised—Standard was known primarily for helping small companies computerize their accounting systems. She was not aware that they had done any work related to knowledge- sharing applications, particularly on a global basis. Upon further investigation into the com- pany, she learned that Standard was owned by an uncle of Lucy Lee’s, and things began to fall into place. Fortunately, she also learned that the firm did have some limited experience in more complex applications. She tried to talk privately with Hsu about his reasons for wanting to consider Standard, but Hsu insisted that Lee participate in all his internal meet- ings. At their most recent meeting, Hsu insisted that Standard be included for possible con- sideration by the board.

During the next two weeks, representatives from each company met with Hsu, his two top executives, and the IT staff to explain their services and give demonstrations. Lassiter had suggested that the board of directors attend these presentations, but Hsu said they wouldn’t have the time and he would need to evaluate everything and make a recommen- dation to the board. At the end of these meetings, Lassiter prepared a final report evaluat- ing the pros and cons of going with each firm and making her first- and second-choice recommendations. Standard was dead last on her list. Although the firm had some excel- lent people and a good reputation, it was simply not capable of handling such a large and complex project.

Lassiter offered to present her findings to the board, but again, Hsu declined her offer in the interest of time. “It’s best if I present them with a final recommendation; that way, we can move on to other matters without getting bogged down with a lot of questions and dis- cussion. These are busy people.” The board meeting was held the following week. Lassiter was shocked when the president returned from the meeting and informed her that the board had decided to go with Standard Systems as the consulting firm for the knowledge- sharing application.

386 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

QUESTIONS

1. How would you explain the board’s selection of Standard Systems?

2. Discuss the types, sources, and relative amount of power for the three main characters in this story.

3. How might Lassiter have increased her power and influence over this decision? If you were in her position, what would you do now?

Sources: Based on “Restview Hospital,” in Gary Yukl, Leadership, 4th ed. (Upper Saddle River, NJ: Prentice Hall, 1998), pp. 203–204; “Did Somebody Say Infrastructure?” in Polly Schneider, “Another Trip to Hell,” CIO (February 15, 2000), pp. 71–78; and Joe Kay, “Digital Diary,” Part I, http://www.forbes.com/asap/2000 (accessed November 19, 2000).

REFERENCES 1. Ben Fritz and Meg James, “Power Struggle at Warner Bros,” The Los

Angeles Times (November 10, 2012), http://articles.latimes.com /2012/nov/10/entertainment/la-et-ct-warners-succession-20121111 (accessed May 17, 2013); and Ben Fritz, “Warner Bros. Old–New Juggle,” The Wall Street Journal (March 26, 2013), p. B1.

2. The terms transactional and transformational leadership are from James MacGregor Burns, Leadership (New York: Harper & Row, 1978); and Bernard M. Bass, “Leadership: Good, Better, Best,” Organizational Dynamics 13 (Winter 1985), pp. 26–40.

3. This discussion is based on Bernard M. Bass, “Theory of Transforma- tional Leadership Redux,” Leadership Quarterly 6, no. 4 (1995), pp. 463–478; Noel M. Tichy and Mary Anne Devanna, The Transformational Leader (New York: John Wiley & Sons, 1986); Lloyd Moman Basham, “Transformational and Transactional Leaders in Higher Education,” SAM Advanced Management Journal (Spring 2012), pp. 15–23; and Badrinarayan Shankar Pawar and Kenneth K. Eastman, “The Nature and Implications of Contextual Influences on Transformational Leadership: A Conceptual Examination,” Academy of Management Review 22, no. 1 (1997), pp. 80–109.

4. See Taly Dvir, Dov Eden, Bruce J. Avolio, and Boas Shamir, “Impact of Transformational Leadership on Follower Development and Performance: A Field Experiment,” Academy of Management Journal 45, no. 4 (2002), pp. 735–744; Ronald F. Piccola and Jason A. Colquitt, “Transformational Leadership and Job Behaviors: The Mediating Role of Core Job Characteristics,” Academy of Management Journal 49, no. 2 (2006), pp. 327–340; and Jens Rowold and Kathrin Heinitz, “Transformational and Charismatic Leadership: Assessing the Convergent, Divergent, and Criterion Validity of the MLQ and CKS,” Leadership Quarterly 18 (2007), pp. 121–133.

5. Based on Bass, “Theory of Transformational Leadership Redux”; Bernard M. Bass, “From Transactional to Transformational Leader- ship: Learning to Share the Vision,” Organizational Dynamics 18, no. 3 (Winter 1990), pp. 19–31; Francis J. Yammarino, William D. Spangler, and Bernard M. Bass, “Transformational Leadership and Performance: A Longitudinal Investigation,” Leadership Quarterly 4, no. 1 (Spring 1993), pp. 81–102; and B. M. Bass, “Current Developments in Transformational Leadership,” The Psychologist- Manager Journal 3, no. 1 (1999), pp. 5–21.

6. Noel M. Tichy and Mary Anne Devanna, The Transformational Leader (New York: John Wiley & Sons, 1986), pp. 265–266.

7. Manfred F. R. Kets De Vries, “Charisma in Action: The Transforma- tional Abilities of Virgin’s Richard Branson and ABB’s Percy Barnevik,” Organizational Dynamics (Winter 1998), pp. 7–21; and Basham, “Transformational and Transactional Leaders in Higher Education.”

8. Katherine J. Klein and Robert J. House, “On Fire: Charismatic Leadership and Levels of Analysis,” Leadership Quarterly 6, no. 2 (1995), pp. 183–198.

9. Rakesh Khurana, “The Curse of the Superstar CEO,” Harvard Business Review (September 2002), pp. 60–66.

10. Jerry Porras, Steward Emery, and Mark Thompson, “The Cause Has Charisma,” Leader to Leader (Winter 2007), pp. 26–31.

11. Carmine Gallo, “7 Tips from Charismatic Leaders,” AskMen.com, http://www.askmen.com/money/successful_100/142b_success.html (accessed May 17, 2013).

12. Steve Moore, “Not Bad for a Hippie Dropout,” Management Today (March 2009), p. 27; Connie Guglielmo, “What Makes Steve Jobs Run?” National Post (May 17, 2008), p. FW-8; and “Editorial: Apple—and U.S.—Need Steve Jobs,” McClatchy-Tribune Business News (January 18, 2009).

13. Jay A. Conger, Rabindra N. Kanungo, and associates, Charismatic Leadership: The Elusive Factor in Organizational Effectiveness (San Francisco: Jossey-Bass, 1988); Robert J. House and Jane M. Howell, “Personality and Charismatic Leadership,” Leadership Quarterly 3, no. 2 (1992), pp. 81–108; Klein and House, “On Fire: Charismatic Leadership and Levels of Analysis”; Harold B. Jones, “Magic, Meaning, and Leadership: Weber’s Model and the Empirical Literature,” Human Relations 54, no. 6 (June 2001), pp. 753–771; and Boas Shamir, Michael B. Arthur, and Robert J. House, “The Rhetoric of Charismatic Leadership: A Theoretical Extension, A Case Study, and Implications for Future Research,” Leadership Quarterly 5, no. 1 (1994), pp. 25–42.

14. The following discussion is based primarily on Conger et al., Charismatic Leadership.

15. This discussion is based on Stephen Friedman and James K. Sebenius, “Organizational Transformation: The Quiet Role of Coalitional Leader- ship,” Ivey Business Journal (January–February 2009), p. 1; Gerald R. Ferris, Darren C. Treadway, Pamela L. Perrewé, Robyn L. Brouer, Ceasar Douglas, and Sean Lux, “Political Skill in Organizations,” Journal of Management (June 2007), pp. 290–320; Vadim Liberman, “Mario Moussa Wants You to Win Your Next Argument,” Questioning Authority column, Conference Board Review (November–December 2007), pp. 25–26; Samuel B. Bacharach, “Politically Proactive,” Fast Company (May 2005), p. 93; and Lauren Keller Johnson, “Debriefing Jay Conger: Exerting Influence without Authority,” Harvard Manage- ment Update (December 2003), pp. 3–4.

16. Nancy F. Koehn, “Lincoln’s School of Management,” The New York Times (January 26, 2013); Hitendra Wadhwa, “Lessons in Leadership: How Lincoln Became America’s Greatest President,” Inc.com (February 12, 2012), http://www.inc.com/hitendra-wadhwa/lessons-in-leadership -how-abraham-lincoln-became-americas-greatest-president.html (accessed March 4, 2013); and Gil Troy and Karl Moore, “Leading from

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 387

the Centre: What CEOs Can Learn from U.S. Presidents,” Ivey Business Journal (September–October, 2010), http://www.iveybusinessjournal .com/topics/leadership/leading-from-the-centre-what-ceos-can-learn -from-u-s-presidents (accessed May 21, 2013).

17. Scott Wilson, “Obama, the Loner President,” The Washington Post (October 7, 2011), http://articles.washingtonpost.com/2011-10-07 /opinions/35280751_1_president-obama-politics-obama-administration (accessed October 8, 2011); and Peter Nicholas, “Obama’s Insular White House Worries His Allies,” The Los Angeles Times (December 24, 2010), http://articles.latimes.com/2010/dec/24/nation/la-na-obama-insular -presidency-20101225 (accessed December 25, 2010).

18. Paul Schwartzman, Daniel de Vise, Anita Kumar, and Jenna Johnson, “U-Va Upheaval: 18 Days of Leadership Crisis,” The Washington Post (June 30, 2012), http://www.washingtonpost.com/local/education/u-va -upheaval-18-days-of-leadership-crisis/2012/06/30/gJQAVXEgEW _story.html (accessed August 6, 2012).

19. Friedman and Sebenius, “Organizational Transformation: The Quiet Role of Coalitional Leadership.”

20. Cari Tuna, “Repairing an Agency’s Credibility,” The Wall Street Journal (March 23, 2009), p. B6.

21. These data are adapted from materials supplied by ExperiencePoint Inc. in conjunction with the Global Tech simulation, 2007.

22. Friedman and Sebenius, “Organizational Transformation.”

23. This discussion is based on Howard Hill, “Machiavellian-Style Leadership,” The Times and Democrat (August 8, 2009), http:// thetandd.com/news/opinion/machiavellian-style-leadership/article _c8ea4911-839a-5c48-b1d9-c7e80ed3734f.html (accessed May 18, 2013); David Brooks, “Florence and the Drones,” The New York Times (February 7, 2013), http://www.nytimes.com/2013/02/08 /opinion/brooks-florence-and-the-drones.html?_r=0 (accessed May 20, 2013); and Tamara L. Gillis, “Machiavelli for Modern Times: An Interpretation of Machiavelli’s The Prince for the College President and the Public Relations Officer,” Elizabethtown College, 1997, http://users .etown.edu/g/gillistl/nickmach.html (accessed May 9, 2013).

24. Brooks, “Florence and the Drones.”

25. Jeffrey Pfeffer, “Power Play,” Harvard Business Review (July–August, 2010), pp. 84–92.

26. Pfeffer, “Power Play”; and Jeffrey Pfeffer, “Don’t Dismiss Office Politics— Teach It,” The Wall Street Journal (October 24, 2011), http://online.wsj .com/article/SB10001424053111904060604576570574190457198.html (accessed May 21, 2013).

27. These are based on Gillis, “Machiavelli for Modern Times”; Hill, “Machiavellian-Style Leadership”; Ozan Örmeci, “Machiavelli’s Ideal Leadership,” Caspian Weekly (February 18, 2011), http://en .caspianweekly.org/main-subjects/turkish-foreign-policy/3731 -machiavellis-ideal-leadership-.html (accessed May 20, 2013); and Suzanne Evans, “How Machiavelli Saved My Family,” The Wall Street Journal (April 6, 2013), p. C1.

28. R. E. Emerson, “Power-Dependence Relations,” American Socio- logical Review 27 (1962), pp. 31–41.

29. Evans, “How Machiavelli Saved My Family.”

30. James MacGregor Burns, Leadership (New York: Harper & Row, 1978).

31. Robert A. Dahl, “The Concept of Power,” Behavioral Science 2 (1957), pp. 201–215.

32. W. Graham Astley and Paramijit S. Pachdeva, “Structural Sources of Intraorganizational Power: A Theoretical Synthesis,” Academy of Management Review 9 (1984), pp. 104–113; and Abraham Kaplan, “Power in Perspective,” in Robert L. Kahn and Elise Boulding, eds., Power and Conflict in Organizations (London: Tavistock, 1964), pp. 11–32.

33. Gerald R. Salancik and Jeffrey Pfeffer, “The Bases and Use of Power in Organizational Decision Making: The Case of the University,” Administrative Science Quarterly 19 (1974), pp. 453–473.

34. Pfeffer, “Power Play.”

35. Earle Hitchner, “The Power to Get Things Done,” National Productivity Review 12 (Winter 1992/93), pp. 117–122.

36. John R. P. French Jr., and Bertram Raven, “The Bases of Social Power,” in D. Cartwright and A. F. Zander, eds., Group Dynamics (Evanston, IL: Row Peterson, 1960), pp. 607–623.

37. Reported in Liberman, “Mario Moussa Wants You to Win Your Next Argument.”

38. Anna Mulrine, “Harnessing the Brute Force of Soft Power,” US News & World Report (December 1–8, 2008), p. 47.

39. Wesley Clark, “The Potency of Persuasion,” Fortune (November 12, 2007), p. 48.

40. Terry R. Bacon, “Power at Work,” Leadership Excellence (July 2011), p. 6. Bacon’s The Elements of Power: Lessons on Leadership and Influence (New York: AMACOM, 2011), discusses various types of leadership power that derive from personal and organizational sources.

41. Jeffrey Pfeffer, Power in Organizations (Marshfield, MA: Pitman Publishing, 1981).

42. Lillian Cunningham, “The Rolodex That Redefined Power,” The Washington Post (December 23, 2011), http://articles.washington -post.com/2011-12-23/national/35287278_1_fortune-indra-nooyi -sheryl-sandberg (accessed May 21, 2013).

43. The following discussion is based on Gary A. Yukl and T. Taber, “The Effective Use of Managerial Power,” Personnel (March–April 1983), pp. 37–44.

44. Pfeffer, Power in Organizations, p. 70.

45. Gerald R. Ferris, Darren C. Treadway, Robert W. Kolodinsky, Wayne A. Hochwarter, Charles J. Kacmar, Ceasar Douglas, and Dwight D. Frink, “Development and Validation of the Political Skill Inventory,” Journal of Management 31, no. 1 (February 2005), pp. 126–152.

46. See Amy J. Hillman and Michael A. Hitt, “Corporate Political Strategy Formulation: A Model of Approach, Participation, and Strategy Decisions,” Academy of Management Review 24, no. 4 (1999), pp. 825–842, for an examination of organizational approaches to political action.

47. Dion Nissenbaum, “Cut Defense? A Fight Begins,” The Wall Street Journal (April 23, 2013), p. B1.

48. Jeffrey Pfeffer, Managing with Power: Politics and Influence in Organizations (Boston, MA: Harvard Business School Press, 1992); Amos Drory and Tsilia Romm, “The Definition of Organizational Politics: A Review,” Human Relations 43 (1990), pp. 1133–1154; Donald J. Vredenburgh and John G. Maurer, “A Process Framework of Organizational Politics,” Human Relations 37 (1984), pp. 47–66; and Lafe Low, “It’s Politics, as Usual,” CIO (April 1, 2004), pp. 87–90.

49. This section is based on Lee G. Bolman and Terrence E. Deal, Reframing Organizations: Artistry, Choice, and Leadership (San Francisco: Jossey-Bass, 1991); and L. G. Bolman and T. E. Deal, “Leadership and Management Effectiveness: A Multi-Frame, Multi- Sector Analysis,” Human Resource Management 30, no. 4 (Winter 1991), pp. 509–534.

50. Tony Manning, “The Art of Successful Influence: Matching Influence Strategies and Styles to the Context,” Industrial and Commercial Training 44, no. 1 (2012), pp. 26–34; and John R. Carlson, Dawn S. Carlson, and Lori L. Wadsworth, “The Relationship between Individual Power Moves and Group Agreement Type: An Examina- tion and Model,” SAM Advanced Management Journal 65, no. 4 (Autumn 2000), pp. 44–51.

388 PART 4 THE LEADER AS A RELATIONSHIP BUILDER

51. D. Kipnis, S. M. Schmidt, C. Swaffin-Smith, and I. Wilkinson, “Patterns of Managerial Influence: Shotgun Managers, Tacticians, and Bystanders,” Organizational Dynamics 12, no. 3 (Winter 1984), pp. 58–67.

52. Based on Joseph Grenny, David Maxfield, and Andrew Shimberg, “How to Have Influence,” MIT Sloan Management Review 50, no. 1 (Fall 2008), pp. 47–52.

53. Ibid.

54. Kipnis et al., “Patterns of Managerial Influence”; Manning, “The Art of Successful Influence: Matching Influence Strategies and Styles to the Context”; and Pfeffer, Managing with Power, Chapter 13.

55. This discussion is based partly on Robert B. Cialdini, “Harnessing the Science of Persuasion,” Harvard Business Review (October 2001), pp. 72–79; and Edward T. Reilly, “Influential Leaders: They Follow Five Proven Steps,” Leadership Excellence (January 2013), p. 10.

56. Judith Tingley, The Power of Indirect Influence (New York: AMACOM, 2001), as reported by Martha Craumer, “When the Direct Approach Backfires, Try Indirect Influence,” Harvard Manage- ment Communication Letter (June 2001), pp. 3–4.

57. Robert B. Cialdini, Influence: Science and Practice, 4th ed. (Boston, MA: Allyn & Bacon, 2001); Cialdini, “Harnessing the Science of Persuasion”; Allan R. Cohen and David L. Bradford, “The Influence Model: Using Reciprocity and Exchange to Get What You Need,” Journal of Organizational Excellence (Winter 2005), pp. 57–80; and Jared Sandberg, “People Can’t Resist Doing a Big Favor—Or Asking for One” (Cubicle Culture column), The Wall Street Journal (December 18, 2007), p. B1.

58. Raymond Hernandez and David W. Chen, “Keeping Lawmakers Happy through Gifts to Pet Charities,” The New York Times (October 19, 2008), p. A1.

59. Cialdini, “Harnessing the Science of Persuasion.”

60. Cohen and Bradford, “The Influence Model.”

61. Pfeffer, Power in Organizations, p. 70.

62. V. Dallas Merrell, Huddling: The Informal Way to Management Success (New York: AMACON, 1979).

63. Suzanne Kapner, “New CEO Shuffles the Deck at Citi,” The Wall Street Journal (January 8, 2013), p. C1.

64. Ceasar Douglas and Anthony P. Ammeter, “An Examination of Leader Political Skill and Its Effect on Ratings of Leader Effective- ness,” Leadership Quarterly 15 (2004), pp. 537–550.

65. Mark DeCambre, “Bair Breaks Rank—FDIC Chief Challenges Geithner, Treasury Plan,” The New York Post (March 20, 2009), p. 39; Joanna Chung, “Bair Lobbies for Stronger Position,” Financial Times (June 12, 2009), p. 6; and Deborah Solomon, “Bair’s Legacy: An FDIC with Teeth,” The Wall Street Journal (July 7, 2011), p. C1.

66. Based on ideas in Heidi Grant Halvorson, “How to Be a Better Boss in 2013,” The Wall Street Journal (January 2, 2013), http://online.wsj .com/article/SB10001424127887323635504578215391693878364 .html (accessed May 21, 2013).

67. Steven R. Weisman, “How Battles at Bank Ended ‘Second Chance’ at a Career,” The New York Times (May 18, 2007), p. A14.

68. Quoted in Allan R. Cohen, Stephen L. Fink, Herman Gadon, and Robin D. Willits, Effective Behavior in Organizations, 7th ed. (New York: McGraw-Hill Irwin, 2001), p. 254.

69. This section is based on Robert J. House and Jane M. Howell, “Personality and Charismatic Leadership,” Leadership Quarterly 3, no. 2 (1992), pp. 81–108; Jennifer O’Connor, Michael D. Mumford, Timothy C. Clifton, Theodore L. Gessner, and Mary Shane Connelly, “Charismatic Leaders and Destructiveness: An Historiometric Study,” Leadership Quarterly 6, no. 4 (1995), pp. 529–555; and Rob Nielsen, Jennifer A. Marrone, and Holly S. Slay, “A New Look at Humility: Exploring the Humility Concept and Its Role in Socialized Charis- matic Leadership,” Journal of Leadership & Organizational Studies 17, no. 1 (February 2010), pp. 33–43.

70. For a discussion of personalized and socialized power, see David C. McClelland, Power: The Inner Experience (New York: Irvington, 1975). A recent review of McClelland’s research related to the use of power is in D. Keith Denton, “Enhancing Power,” Industrial Management (July–August 2011), pp. 12–17.

71. Tom Vanden Brook and Gregg Zoroya, “Why the Military Hasn’t Stopped Sexual Abuse,” USA Today (May 15, 2013), http://www .usatoday.com/story/news/2013/05/15/why-the-military-hasnt -stopped-sexual-abuse-/2162399/ (accessed May 21, 2013).

72. Rodes Fishburne, “Stop the Politics,” Forbes ASAP (April 3, 2000), p. 126.

CHAPTER 12 LEADERSHIP POWER AND INFLUENCE 389

Part 5: The Leader as Social Architect

Chapter 13: Creating Vision and Strategic Direction

Chapter 14: Shaping Culture and Values

Chapter 15: Leading Change

Ed w ar de s/ St on e/ G et ty Im ag es

Chapter13:CreatingVisionandStrategicDirection

Ed w ar de s/ St on e/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Explain the relationship among vision, mission, strategy, and mechanisms for execution. • Create your personal leadership vision. • Use the common themes of powerful visions in your life and work. • Describe four basic approaches for framing a noble purpose that followers can believe in. • Understand how leaders formulate and implement strategy. • Apply the elements of effective strategy.

CHAPTER OUTLINE 394 The Leader’s Job: Looking

Forward

398 Leadership Vision

406 Mission

411 The Leader as Strategist- in-Chief

In the Lead

397 John Riccitiello, Electronic Arts

406 Ari Weinzweig and Paul Saginaw, Zingerman’s Community of Businesses

410 TeamBank, Volksbanken Raiffeisenbanken Group

412 Marissa Mayer, Yahoo

Leader’s Self-Insight

401 My Personal Vision

403 Visionary Leadership

414 Your Strategy Style

Leader’s Bookshelf

399 Ten Steps Ahead: What Separates Successful

Business Visionaries from the Rest of Us

Leadership at Work

418 Future Thinking

Leadership Development: Cases for Analysis

420 The New Museum

421 The Visionary Leader

N ick Saban took on one of the most high-profile coaching jobs in college sports. Paul “Bear” Bryant, who led the University of Alabama football team to six national championships, is still a hero in Alabama. Even after

he left as coach in the early 1980s, the Crimson Tide remained at the top of the Southeastern Conference (SEC) and was for decades a team to be feared. Then things went wrong. By the time Saban took over as head coach in 2007, the team had suffered through several losing seasons, including some humiliating defeats, and sank to the middle of the SEC rankings. For fans, having the mighty Tide seen as a loser was tough. Hopes were high that Saban could turn things around, but most people thought it would take a few seasons.

Saban didn’t agree. He came in and revived the once-great football program in record time, going 12-0 in the second year. How did he do it? “First of all, you’ve got to have a vision,” Saban says. “Then you’ve got to have a plan to implement it. Then you’ve got to set the example that you want, develop the principles and values that are important, and get people to buy into it.” He inspired players with a vision of being at the top of the heap again, being the mighty Crimson Tide of the Bear Bryant legend. He developed a strategy to achieve the vision, including detailed plans for every aspect of the football program. Then, he focused everyone relentlessly on executing the vision and strategy.1

That’s what all successful leaders do. One of the most important functions of a leader is to articulate and communicate a powerful vision that will motivate and energize people toward the future and then help them implement the plans that will

393 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

achieve that future. In this chapter, we first provide an overview of the leader’s role in creating the organization’s future by stimulating both vision and action. Then, we examine what vision is, the underlying themes that are common to effective visions, and the steps to creating a powerful vision. The distinction between vision and the organization’s mission is also explained. Finally, we discuss how leaders formulate and execute a strategy to achieve the vision.

THE LEADER’S JOB: LOOKING FORWARD Many cars and mobile phones have built-in GPS systems that will guide you to the restaurant, business, or residence you’re trying to get to. If you take a wrong turn, the unit will reset and report something like “recalculating route.” That’s similar to what leaders do. They look forward and recalculate the route when it is necessary to keep the organization thriving.2 Superior organizational performance is not a matter of luck. It is determined largely by the choices leaders make. Top leaders are responsible for knowing the organization’s environment, considering what it might be like in 5 or 10 years, and setting a direction for the future that everyone can believe in. Lorraine Monroe, former principal of the renowned Frederick Dou- glass Academy in Harlem and founder of the Lorraine Monroe Leadership Institute, refers to a leader as “the drum major, the person who keeps a vision in front of people and reminds them of what they’re about.”3

Stimulating Vision and Action In the waiting lounge of a fine lakeside restaurant, a sign reads, “Where there is no hope in the future, there is no power in the present.” The owner explains its pres- ence there by telling the story of how his small, picturesque village with its homes and businesses was sacrificed to make way for a flood-control project. After losing their fight to reverse the decision, most business leaders simply let their businesses decline and die. Soon, the only people who came to the village did so to eat at the cheery little diner, whose owner became the butt of jokes because he continued to work so hard. Everyone laughed when he chose to open a larger and fancier restau- rant on the hill behind the village. Yet, when the flood-control project was finally completed, he had the only attractive restaurant on the edge of a beautiful, newly constructed lake that drew many tourists. Anyone could have found out, as he did, where the edge of the lake would be, yet most of the business owners had no vision for the future. The restaurant owner had a vision, and he took action on it.

Hopes and dreams for the future are what keep people moving forward. Read the story in the Consider This box for some insight into the importance of vision as a window to the world that followers may not see. Leaders not only tap into dreams for the future; to make a real difference, they link those dreams with strate- gic actions. Vision has to be translated into specific goals, objectives, and plans so that employees know how to move toward the desired future. An old English churchyard saying applies to organizations as it does to life:

Life without vision is drudgery. Vision without action is but an empty dream. Action guided by vision is joy and the hope of the earth.4

Exhibit 13.1 illustrates four possibilities of leadership in providing direction. Four types of leaders are described based on their attention to vision and attention

NEW LEADER ACTION MEMO As a leader, you can combine vision with action. You can make a difference for your team or organization by both having big dreams and transforming them into significant strategic action.

394 PART 5 THE LEADER AS SOCIAL ARCHITECT

to action. The person who is low both on providing vision and stimulating action is uninvolved, not really a leader at all. The leader who is all action and little vision is a doer. He or she may be a hard worker and dedicated to the job and the organiza- tion, but the doer is working blind. Without a sense of purpose and direction, activ- ities have no real meaning and do not truly serve the organization, the employees, or the community. The dreamer, on the other hand, is good at providing a big idea

EXHIBIT 13.1 Linking Strategic Vision and Strategic Action

Vision

Action

Source: Based on William D. Hitt, The Leader–Manager: Guidelines for Action (Columbus, OH: Battelle Press, 1988), p. 7.

Consider Opening a Window to a Brighter World

A blind man was brought to the hospital. He was both depressed and seriously ill. He shared a room with another man, and one day asked, “What is going on outside?” The man in the other bed explained in some detail about the sunshine, the gusty winds, and the people walking along the sidewalk. The next day, the blind man again asked, “Please tell me what is going on outside today.” The roommate responded with a story about the activities in a park across the way, the ducks on the pond, and the people feeding them. The third day and each day thereafter for two weeks, the blind man asked about the world outside and the other man answered, describing a different scene. The blind man enjoyed these talks, and he grew happier learning about the world seen through the window.

Then the blind man’s roommate was discharged from the hospital. A new roommate was wheeled in—a tough-minded businessman who felt terrible, but wanted to get work done. The next morning, the blind man said, “Will you please tell me what is going on outside?” The businessman didn’t feel well, and he didn’t want to be bothered to tell stories to a blind man. So he responded assertively, “What do you mean? I can’t see outside. There is no window here. It’s only a wall.”

The blind man again became depressed, and a few days later he took a turn for the worse and was moved to intensive care.

Source: Based on a story the author heard at a spiritual service in Santa Fe, New Mexico.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 395

with meaning for self and others. This leader may effectively inspire others with a vision, yet he or she is weak on executing strategic action. The vision in this case is only a dream, a fantasy, because it has little chance of ever becoming reality. To be an effective leader, like Nick Saban at the University of Alabama football program, one both dreams big and transforms those dreams into significant strategic action, either through one’s own activities or by hiring other leaders who can effectively execute the vision and strategy.

Strategic Leadership Strategic leadership is one of the most critical issues facing organizations.5 Strategic leadership means the ability to anticipate and envision the future, maintain flexibil- ity, think strategically, and work with others to initiate changes that will create a competitive advantage for the organization in the future.6 In a fast-changing world, leaders are faced with a bewildering array of complex and ambiguous infor- mation, and no two leaders will see things the same way or make the same choices.

The complexity of the environment and the uncertainty of the future can over- whelm a leader. In addition, many leaders are inundated with information and overwhelmed by minutiae. They may have difficulty finding the quiet time needed for “big-picture thinking.” One study looked at the time executives in various departments spend on long-term, strategic activities and found discouraging results. In the companies studied, 84 percent of finance executives’ time, 70 percent of information technology (IT) executives’ time, and 76 percent of operational man- agers’ time is focused on routine, day-to-day activities.7 Another study found that, on average, senior executives spend less than 3 percent of their energy on building a corporate perspective for the future.8 Yet no organization can thrive for the long term without a clear viewpoint and framework for the future.

Exhibit 13.2 illustrates the levels that make up the domain of strategic leader- ship. Strategic leadership is responsible for the relationship of the external environ- ment to choices about vision, mission, strategy, and their execution.9 At the top of Exhibit 13.2 is a clear, compelling vision of where the organization wants to be in 5 to 10 years. A vision is an aspiration for the future and answers the question “Where are we headed?”10 The vision works in concert with the company’s mission—its core values, purpose, and reason for existence. Mission answers the question “Who are we as an organization?” The next level in Exhibit 13.2, strategy,

Strategic leadership the ability to anticipate and envision the future, maintain flexibility, think strategically, and initiate changes that will create a competitive advan- tage for the organization in the future

NEW LEADER ACTION MEMO As a leader, you can learn to think strategically. You can anticipate and envision the future, and initiate changes that can help the group or organization thrive over the long term.

EXHIBIT 13.2 The Domain of Strategic Leadership

396 PART 5 THE LEADER AS SOCIAL ARCHITECT

responds to the question “How do we achieve the vision?” Strategy provides direction for translating the vision into action and is the basis for the development of specific mechanisms to help the organization achieve goals. Execution specifies “What do we do right now?” Strategies are intentions, whereas execution is through the basic organizational architecture (structure, incentives) that makes things happen. Each level of the hierarchy in Exhibit 13.2 supports the level above it. Each part of this framework will be discussed in the remainder of this chapter.

Strategic leadership doesn’t come naturally, but leaders can develop the neces- sary skills for thinking strategically and navigating uncertainty:11

• Anticipate threats and opportunities. Effective leaders are continuously scan- ning the environment—talking to customers and other outsiders, researching the industry and markets, and so forth—so they don’t miss important signs of change that could help or hurt the organization.

• Challenge the status quo. Strategic thinkers question their own and others’ assumptions and mental models, as we discussed in Chapter 5. They examine problems or opportunities from many perspectives.

• Interpret trends. Leaders look for patterns in what they see and hear and seek new insights rather than accepting the easy answer. One food company execu- tive was developing a marketing plan for the company’s low-carb cake line, but she noticed that most of the customers she talked to kept mentioning problems with eating too much sugar. She worked with other leaders and came up with a highly profitable change in the product mix from low-carb to sugar-free cakes.

• Achieve alignment. Leaders have to get buy-in among employees and other sta- keholders who may have different, even conflicting views and interests. To achieve the vision, everyone must be aligned in the same direction.

To improve strategic leadership, leaders can identify weak points in these skills and work toward correcting them. John Riccitiello, former CEO of Electronic Arts (EA), talks about the importance of these leader skills.

IN THE LEAD John Riccitiello, Electronic Arts Several years ago, John Riccitiello saw that EA was in trouble. Social networks and mobile phones were threatening the traditional video game business, and people in the company were scared. Riccitiello had a realization that as a leader “you need to paint a picture that everyone can buy into, even though you’re not sure yourself it’s going to work because you’re trying to see the other side of a technology transition.”

Riccitiello listens to people both inside and outside the organization to try to make sure he’s not heading left when he should be heading right, but he understands that being a leader in a fast-changing industry requires continual adjustment. He is honest with people and tells them that charting a new direction means that sometimes it may be only 70 percent certain because of the uncertainty of the industry, but he emphasizes that every- one has to be 100 percent committed to the direction and know that leaders will pull back and make adjustments when they learn something isn’t working. Riccitiello successfully steered EA through a major transformation from console games to the world of mobile phones and tablets by aligning everyone in the same direction. In a large organization, he says, “you’re mostly painting a picture for a lot of people for whom you’re just a concept….

Check out CengageNOW to complete an online ques- tionnaire that examines your

approach to setting goals.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 397

So you’ve got to find a way to be incredibly consistent, so when other people repeat the same thing it conjures up the same image for everyone else.” Without a vision that everyone understands and buys into, people can find themselves pulling in opposite directions—that makes it tough for the company to get where it needs to go.12

Riccitiello resigned in 2013, saying he felt it was time for a new top leader to take EA to the next phase of growth. During his time with EA, Riccitiello took some bold and risky moves. Some paid off and some didn’t, but his approach to strategic leadership was generally positive for the company. One person who worked closely with Riccitiello on shaping strategy says, “The truth is that the game industry continues to pivot very rapidly. EA is in a good place but it requires a lot of energy and laser focus…. He’s been pivoting the company hard for many years, but the industry keeps pivoting faster.”13

Firm strategic leadership is essential for organizations to be effective. Consider that the Conference Board recently reported that 40 percent of all IT development projects are canceled before they are completed, at a significant cost to organizations, and the primary factor explaining their failure is ineffective strategic leadership.14

LEADERSHIP VISION A vision is an attractive, ideal future that is credible yet not readily attainable. It is an ambitious view of the future that everyone involved can believe in, one that can realistically be achieved, yet one that offers a future that is better in important ways than what now exists.15 Strong, inspiring visions have been associated with higher organizational performance and greater employee motivation and satisfaction.16

After the financial crisis, leaders at Standard Chartered Bank, which had been a regular takeover target for some years, came out with a brief vision statement, “Here for good,” that reflected a dual aspiration: staying around for the long term, and doing good in the world.17 The vision fired people’s imaginations and renewed their sense of pride. Other examples of this type of brief, compelling, and

EXHIBIT 13.3 Examples of Brief Vision Statements

• Apple: To make a contribution to the world by making tools for the mind that advance humankind.

• Four Seasons: Achieve first-choice ranking among guests. • BAE Systems (defense company): To protect those who protect us. • Virginia Department of Transportation: Keep Virginia moving. • Deloitte Touche Tohmatsu: To be recognized as the best professional services firm in

the world. • Ukrop’s Food Group: To be a world-class provider of food and services. • United Way: Improve lives by mobilizing the caring power of communities.

Sources: These examples are from Pieter Klass Jagersma, “Aspiration and Leadership,” Journal of Business Strategy 28, no. 1 (2007), pp. 45–52; Douglas A. Ready and Emily Truelove, “The Power of Collective Ambition,” Harvard Business Review (December 2011), pp. 95–102; “We Protect Those Who Protect Us,” York Daily Record, May 12, 2010, http://www.ydr.com/ ci_15067292 (accessed May 16,2013); James G. Clawson, Level Three Leadership: Getting Below the Surface, 4th ed. (Upper Saddle River, NJ.: Pearson/Prentice Hall, 2009), pp. 120–124; Sooksan Kantabutra and Gayle C. Avery, “The Power of Vision: Statements That Resonate,” Journal of Business Strategy 31, no. 1(2010), pp. 37–45; and Nancy Lublin, “Wordplay,” Fast Company (November 2009), p. 86.

Vision an attractive, ideal future that is credible yet not readily attainable

398 PART 5 THE LEADER AS SOCIAL ARCHITECT

slogan-like vision include Coca-Cola’s “A Coke within arm’s reach of everyone on the planet,” Canon’s “Beat Xerox,” and Komatsu’s “Encircle Caterpillar.” These visions can be easily communicated and understood by everyone in the organization and serve to motivate all employees.

Exhibit 13.3 lists a few more brief vision statements that let people know where the organization wants to go in the future. Not all successful organizations have such short, easily communicated slogans, but their visions are powerful because lea- ders paint a compelling picture of where the organization wants to go. The vision expressed by civil rights leader Martin Luther King, Jr., in his “I Have a Dream” speech is a good example of how leaders paint a vision in words. King articulated a vision of racial harmony, where discrimination was nonexistent, and he conveyed the confidence and conviction that his vision would someday be achieved. Courage and conviction are characteristics of successful visionary leaders. Vision isn’t magic; it relies on skills and qualities that leaders can develop, as further described in this chapter’s Bookshelf.

Leaders in nonprofit organizations also create visions so people know where the organization wants to go. For example, leaders at the Greater Chicago Food Depository have a vision of transforming the nonprofit agency from an organization

LEADER’S BOOKSHELF Ten Steps Ahead: What Separates Successful Business Visionaries from the Rest of Us

by Eric Calonius

The first time Jeff Bezos saw a Web site and learned that the web population was growing at a rate of 2,000 percent a year, he had a vision of a future that was vastly different from anything anyone had experienced. Amazon.com was born, and the world of bookselling and publishing was changed forever. It seems like magic, but Eric Calonius, a former writer and editor for The Wall Street Journal and Fortune magazine, says the elements of vision are explain- able—and attainable by anyone.

WHAT MAKES A LEADER VISIONARY? Calonius uses research in the fields of neuroscience and cognitive psychology to explore the brain as a “visionary device” whose “primary function is to create pictures in our minds that can be used as blueprints for things that do not exist.” How do successful busi- ness leaders tap into them?

• They Use Intuition. Visionary leaders trust their gut feelings. The subcon- scious mind, says Calonius, “draws on patterns that we are not consciously

aware of.” Trusting the patterns his subconscious perceived helped Walt Disney decide that the first full-length feature cartoon would not be one of the classics suggested by actors or pro- ducers but a fairy tale by the Brothers Grimm. Snow White and the Seven Dwarfs was a huge hit.

• They Rely on Emotional Intelligence. The subconscious of successful vision- aries also draws on the emotional mind, which Calonius says evolved as a survival tool that helps people make good intuitive decisions. He quotes New York Times writer David Brooks, who said “Emotions are the processes we use to assign value to different pos- sibilities. [They] move us toward things and ideas that produce pleasure and away from [those] that produce pain.”

• They Exhibit Courage and Conviction. Visionaries are fighters. They are hard- headed and ruthless in pursuing the vision. “In visionaries, the drive to see their dreams fulfilled exceeds rational behavior,” Calonius says. Andrew Grove, former chairman and CEO of

Intel, risked his money and his busi- ness to produce and manufacture the first workable commercial memory chip. Then, he did it again a decade or so later when he abandoned the memory chip business to focus exclu- sively on microprocessors.

LEADERS CAN LEARN TO BE VISIONARY The brain is a prediction machine, Calo- nius says, and life is a series of anticipa- tions. If all our brains work as visionary devices, he asserts, we can all learn to be visionary leaders by tapping into the ele- ments and ideas described in Ten Steps Ahead. He quotes Sir Richard Branson, founder of the Virgin Group of compa- nies: “Some of the best ideas come from out of the blue, and you just have to keep an open mind to see their virtue.”

Sources: The ideas for this questionnaire were drawn primarily from Chris Rogers, “Are You Deciding on Purpose?” Fast Company (February/ March 1998), pp. 114–117; and J. Crumbaugh, “Cross-Validation of a Purposein-Life Test Based on Frankl’s Concepts,” Journal of Individual Psy- chology 24 (1968), pp. 74–81.

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that just feeds the hungry to one that helps end hunger. The agency sponsors an intense 12-week program aimed at teaching low-income, low-skilled workers the basics of cooking, along with life skills such as punctuality, teamwork, commitment, and personal responsibility, with the goal of landing each person a good job. The vision of helping people change their lives has energized employees in a way that sim- ply providing food to low-income clients never did.18 Vision is just as important for nonprofit agencies like the Greater Chicago Food Depository, the United Way, and the Salvation Army as it is for businesses such as Coca-Cola, Google, or General Electric. Indeed, nonprofits sometimes need vision even more than do businesses, since they operate without the regular feedback provided by profit and loss.19

In Exhibit 13.4, vision is shown as a guiding star, drawing everyone along the same path toward the future. Vision is based in the current reality but is concerned with a future that is substantially different from the status quo.20 Taking the group or organization along this path requires leadership. Compare this to rational man- agement (as described in Chapter 1), which leads to the status quo.

What Vision Does Vision works in a number of important ways. An effective vision provides a link between today and tomorrow, serves to energize employees and focus their atten- tion, provides meaning for people’s work, and sets a standard of excellence and integrity in the organization.21

Vision Links the Present to the Future Vision connects what is going on right now with what the organization aspires to. A vision is always about the future, but it begins with the here and now. At Google, employees are guided by a vision of

EXHIBIT 13.4 The Nature of the Vision

Source: Based on William D. Hitt, The Leader–Manager: Guidelines for Action (Columbus, OH: Battelle Press, 1988).

NEW LEADER ACTION MEMO Go to Leader’s Self-Insight 13.1 and answer the questions to learn where you stand with respect to a personal vision.

400 PART 5 THE LEADER AS SOCIAL ARCHITECT

unifying data and information around the world, one day totally obliterating lan- guage barriers via the Internet.22 They create services that meet current needs, but they also strive to envision and create products and services that encourage other, broader applications.

In organizations, the pressures to meet deadlines, make the big sale, solve immediate problems, and complete specific projects are very real. Some have sug- gested that leaders need “bifocal vision,” the ability to take care of the needs of today and meet current obligations while also aiming toward dreams for the future.23 The ability to operate on both levels can be seen in a number of successful companies, such as DuPont. Top executives routinely review short-term operational goals with managers throughout the company, reflecting a focus on the present. However, DuPont has succeeded over the long haul because of its leaders’ ability to keep an eye on the future and shift gears quickly to take advantage of new opportunities. Since its beginning, DuPont’s business portfolio has shifted from gun- powder to specialty chemicals, and today, the company has moved into biotechnol- ogy and life sciences.24

Vision Energizes People and Focuses Attention When people have a clear picture of where the organization wants to be in the future, they can help take it there.25 Many people commit their time and energy voluntarily to projects they believe in—a politi- cal campaign, community events, or environmental causes, for example. These same people often leave their energy and enthusiasm at home when they go to work because they don’t have anything to inspire them. A clear vision lets people know

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C a CLEADER’S SELF-INSIGHT 13.1

My Personal Vision

Instructions: How much do you think about the positive outcomes you want in your future? Do you have a personal vision for your life? Indicate whether each of the following items is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I can describe a compelling image of my future.

2. Life to me seems more exciting than routine.

3. I have created very clear life goals and aims.

4. I feel that my personal existence is very meaningful.

5. In my life, I see a reason for being here.

6. I have discovered a satisfying “calling” in life.

7. I feel that I have a unique life purpose to fulfill.

8. I will know when I have achieved my purpose.

9. I talk to people about my personal vision.

10. I know how to harness my crea- tivity and use my talents.

Scoring and Interpretation Add the number of Mostly True answers for your score: . A score of 7 or above indicates that you are in great shape with respect to a personal vision. A score of 3 or below would suggest that you have not given much thought to a vision for your life. A score of 4–6 would be about average.

Creating a personal vision is difficult work for most people. It doesn’t happen easily or naturally. A personal vision is just like an organizational vision in that it requires focused thought and effort. Spend some time thinking about a vision for yourself and write it down.

Sources: The ideas for this questionnaire were drawn primarily from Chris Rogers, “Are You Deciding on Purpose?” Fast Company (February/March 1998), pp. 114–117; and J. Crumbaugh, “Cross-Validation of a Purpose- in-Life Test Based on Frankl’s Concepts,” Journal of Individual Psychology 24 (1968), pp. 74–81.

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what they should be doing and, just as importantly, what they should not be doing. Sometimes, what is left out or “not done” is just as valuable as what is done for building the desired future.26 Consider TeamBank, a rapidly growing and profitable subsidiary of the German Volksbanken Raiffeisenbanken Group. The innovative financial services company has a vision to “be a responsible partner for fair consumer financing.” Based on the vision, managers have chosen to stay out of point-of-sale financing, often used for purchases of cars or expensive consumer electronics, because they know people often sign loans on impulse that they later cannot repay. Similarly, employees know not to consider socioeconomic scores of residential areas when offering loans because this goes against the company’s vision.27

Vision Gives Meaning to Work Vision needs to transcend the bottom line to provide employees with a sense of meaning and purpose. People are generally not willing to make emotional commitments just for the sake of increasing profits, but they are often eager to commit to something truly worthwhile, something that makes life better for others or improves their communities.28 Consider Henry Ford’s original vision for Ford Motor Company:

I will build a motor car for the great multitude…. It will be so low in price that no man making a good salary will be unable to own one and enjoy with his family the blessings of hours of pleasure in God’s open spaces…. When I’m through, everybody will be able to afford one, and everyone will have one. The horse will have disappeared from our highways, the automobile will be taken for granted [and we will give many people] employment at good wages.29

Employees were motivated by Ford’s vision because they saw an opportunity to make life better for themselves and others.

People want to find significance and dignity in their work. Even employees performing routine tasks can find pride in their work when they have a larger purpose for what they do. For example, an insurance clerk who thinks of her job as helping victims of fire or burglary put their lives back in order will feel very differently than one who thinks of his job as “processing insurance claims.”30

“People want to accomplish great things,” advises former UPS CEO Michael L. Eskew. “They want to make a difference.”31

Vision Establishes a Standard of Excellence and Integrity A powerful vision frees people from the mundane by providing them with a challenge that requires them to give their best. A quote from Antoine Saint-Exupery illustrates this aspect of leader vision: “A rock pile ceases to be a rock pile the moment a single man con- templates it, bearing within him the image of a cathedral.”32 Vision also provides a measure by which employees can gauge their contributions to the organization. Most workers welcome the chance to see how their work fits into the whole. Think of how frustrating it is to watch a movie when the projector is out of focus. Today’s complex, fast-changing business environment often seems just like that— out of focus.33 A vision is the focus button. It clarifies an image of the future and lets people see how they can contribute. A vision presents a challenge—asking peo- ple to go where they haven’t gone before.

Good visions clarify and connect to the core values and ideals of the organiza- tion and thus set a standard of integrity for employees. A good vision brings out the best in people by illuminating important values, speaking to people’s hearts, and letting them be part of something bigger than themselves.

NEW LEADER ACTION MEMO As a leader, you can articulate an optimistic vision for the fu- ture that will inspire and chal- lenge people to give their best, set a standard of excellence and integrity, and help people find meaning in their work. Evaluate your potential for visionary leadership by completing the questionnaire in Leader’s Self- Insight 13.2.

402 PART 5 THE LEADER AS SOCIAL ARCHITECT

Common Themes of Vision Four themes are common to powerful, effective visions: they have broad, widely shared appeal; they help organizations deal with change; they reflect high ideals; and they define both the organization’s destination and the basic rules to get there.

Vision Has Broad Appeal Although it may seem obvious that a vision can be achieved only through people, many visions fail to adequately involve employees. Isolated top leaders may come up with a grand idea that other employees find ridiculous, or they might forget that achieving the vision requires understanding and commitment throughout the organization. The vision cannot be the property of the leader alone.34 The ideal vision is identified with the team or organization as a whole. It “grabs people in the gut” and motivates them to work toward a common end.35 Admiral Vernon Clark, the former chief of naval operations we described in Chapter 4, involved sailors in the vision of creating a twenty- first-century U.S. Navy that is “strategically and operationally agile, technologi- cally and organizationally innovative, networked at every level, highly joint [with the other services], and effectively integrated with allies” by emphasizing each indi- vidual’s personal role. “What we do matters,” he told them. “We do it because it’s important and we are people of service. We are committed to something larger

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 13.2

Visionary Leadership

Instructions: Think about a situation in which you either assumed or were given a leadership role in a group. Imagine your own behavior as a leader. To what extent do the following statements characterize your leadership? Indicate whether each of the following items is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I have a clear understanding of where we are going.

2. I work to get others committed to our desired future.

3. I initiate discussion with others about the kind of future I would like us to create together.

4. I show others how their interests can be realized by working toward a common vision.

5. I look ahead and forecast what I expect in the future.

6. I make certain that the activities I manage are broken down into manageable chunks.

7. I seek future challenges for the group.

8. I spend time and effort making certain that people adhere to the values and outcomes that have been agreed on.

9. I inspire others with my ideas for the future.

10. I give special recognition when others’ work is consistent with the vision.

Scoring and Interpretation The odd-numbered questions pertain to creating a vision for the group. The even-numbered questions pertain to imple- menting the vision. Calculate your score for each set of questions. Which score is higher? Compare your scores with other students.

This questionnaire pertains to two dimensions of visionary leadership. Creating the vision has to do with whether you think about the future, whether you are excited about the future, and whether you engage others in the future. Implementing the vision is about the extent to which you communicate, allocate the work, and provide rewards for activities that achieve the vision. Which of the two dimensions is easier for you? Are your scores consistent with your understanding of your own strengths and weak- nesses? What might you do to improve your scores?

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than ourselves: the protection of America’s interests around the world and democracy.”36

Vision Deals with Change Effective visions help the organization achieve bold change. Online retailer Amazon.com’s early vision was to be “Earth’s largest bookstore.” That aspiration achieved, the company expanded into all types of merchandise and has recently even added groceries. However, by 2004, Jeff Bezos was exploring a radical idea for a retailer: he wanted Amazon to make the hardware people could use to buy Amazon’s stuff. A few years later, the Kindle and Kindle Fire were born. Jateen Parekh, who joined Amazon to help develop the Kindle, recalls Bezos asking him What should Amazon be doing in 20 years? “The fact that the CEO was thinking that far out was huge,” Parekh says.37 Change can be frightening, but a clear sense of direction helps people face the difficulties and uncertainties involved in the change process. When employees have a clear and consistent guiding vision, everyday decisions and actions throughout the organization respond to current problems and challenges in ways that move the organization toward the future.38

Vision Reflects High Ideals Good visions are idealistic. Vision is an emotional appeal to our fundamental human needs and desires—to feel important and useful, to believe we can make a real difference in the world.39 Visions that portray an uplifting future have the power to inspire and energize people. For example, when John F. Kennedy announced a vision for NASA to send a man to the moon by the end of the 1960s, NASA had only a small amount of the knowledge it would need to accomplish the feat. Yet in July 1969, the vision became a reality.40 A business example comes from Qualcomm, where CEO Paul Jacobs has articulated an ideal- istic vision to improve the capacity of wireless networks by 1,000 times, as well as provide tiny home equivalents of cellular broadcast towers. Since there is growing demand for wireless data transmission, Jacobs believes some of that traffic can be moved to home bases that are about the size of a deck of cards and would plug into a home computer or Wi-Fi connection.41

People at Qualcomm have been developing the technology to make the vision a reality. When every person understands and embraces a vision, the organization becomes self-adapting. Although each individual acts independently, everyone is working in the same direction. In the new sciences, this is called the principle of self-reference. Self-reference means that each element in a system will serve the goals of the whole system when the elements are imprinted with an understanding of the whole. Thus, the vision serves to direct and control people for the good of themselves and the organization.

Vision Defines the Destination and the Journey A good vision for the future includes specific outcomes that the organization wants to achieve. It also incorpo- rates the underlying values that will help the organization get there. For example, a private business school might specify certain outcomes such as a top-20 ranking, placing 90 percent of students in summer internships, and getting 80 percent of stu- dents into jobs by June of their graduating year. Yet in the process of reaching those specific outcomes, the school wants to increase students’ knowledge of busi- ness, ethical values, and teamwork, as well as prepare them for lifelong learning. Additionally, the vision may espouse underlying values such as no separation between fields of study or between professors and students, a genuine concern for students’ welfare, and adding to the body of business knowledge. A good vision

404 PART 5 THE LEADER AS SOCIAL ARCHITECT

Self-reference a principle stating that each element in a system will serve the goals of the whole system when the elements are imprinted with an un- derstanding of the whole

includes both the desired future outcomes and the underlying values that set the rules for achieving them.

Leader Steps to Creating a Vision In innovative companies, leaders cocreate the vision with followers so that everyone is intimately involved in building the desired future. With cocreation, everyone can identify with the vision and have a deeper understanding and commitment to achieving it. In addition, cocreation demonstrates that leaders value the thoughts, ideas, dreams, and power of others.42

To cocreate a vision, leaders share their personal visions with others and encourage others to express their dreams for the future. This requires openness, good listening skills, and the courage to connect with people on an emotional level. A leader’s ultimate responsibility is to be in touch with the hopes and dreams that drive employees and find the common ground that binds personal dreams into a shared vision for the organization. The vision becomes the common thread con- necting people, involving them personally and emotionally in the organization.43

Leaders use the following steps to cocreate a vision:44

1. Target a vision for a desired future. Vision typically begins with the leader, who has a vivid and compelling idea of where the team or organization should go. The leader has to be excited by the idea before anyone else will be. Leaders spend time imagining where they want the organization to be and what it will look and feel like when it gets there.

2. Cocreate the vision. Even though leaders get the ball rolling, they don’t present a fully formed vision to followers. People want visions of the future that reflect their own dreams and hopes. Leaders consult as many people from different areas as possible to learn what frustrates them, what energizes them, and what they want the future to be like. They may use focus groups or other mechan- isms to get people talking about the future and what they want it to be.

3. Identify strengths. Put together a list of what the organization does well and the things people are proud of. Based on talks with people across the organization or what comes out of focus groups, list past achievements, skills, resources, and so forth that might be assets in achieving the desired future. Create a vision that builds on and extends the current strengths of the organization.

4. Write a first draft. It’s important to get something down in writing, but make sure people know it is a draft that needs feedback. Write from the heart, remembering that it is emotion that drives people. Aim for something great and put yourself into the future you are envisioning.

5. Solicit feedback and create the final vision statement. The vision statement may go through several drafts before it is final. The important thing is that everyone has a chance to provide feedback.

6. Share the vision widely. Communicate broadly and often, using multiple chan- nels. During the Civil War, Abraham Lincoln was a master at preaching the vision of an America that offered equality, freedom, and a fair chance for all. Through speeches, writings, and conversations, at every conceivable opportunity, he reminded people of the basic principles on which the nation was founded.45

The following example describes how two entrepreneurs used vision cocreation to turn a small delicatessen into a community of eight thriving businesses.

NEW LEADER ACTION MEMO As a leader, you can cocreate a shared vision so that every individual, team, and depart- ment is moving in the same direction. You can help people see the values, activities, and objectives that will attain the vision.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 405

IN THE LEAD Ari Weinzweig and Paul Saginaw, Zingerman’s Community of Businesses Ari Weinzweig and Paul Saginaw started a small delicatessen in Ann Arbor, Michigan, because they wanted to serve the best sandwiches in the world. The deli was a rousing suc- cess, but after a decade or so, the two noticed a problem. Business was still strong, but the deli no longer offered challenges and opportunities for growth to employees. When one manager with an MBA decided to start her own bakery to supply breads and pastries for the deli, Weinzweig and Saginaw had an idea—why not tap into the dreams of employees and start a whole community of small businesses, each with the Zingerman’s name but each having its own identity? Thus was born Zingerman’s Community of Businesses, with each business unique, each with managing partners who have an equity stake and run the day-to-day operations, and each contributing to the success of the others. By 2011, the community consisted of 17 partners, 500 or so employees working in eight separate busi- nesses, and revenue of $37 million a year. The company’s long-term vision is to have 12 to 18 separate businesses.

Weinzweig and Saginaw start brainstorming on a vision for where they want Zinger- man’s Community to go months or even years in advance, and they also have each partner in the group write his or her own vision based on the same topic and time frame. Once each person has put together a draft, the partners compare them and look for key themes that are written on a whiteboard. Everyone has a chance to weigh in with their feelings about each theme, and people vote on how the themes should be prioritized. Eventually, the group comes together around a single vision that is then shared with managers, employees, and even customers for feedback.

It is hard work, and occasionally there are incompatible ideas and visions. When the larger vision can’t shift and compromises can’t be reached, people have to agree to go their separate ways. Sometimes a business will be split in two, for instance. “It’s painful,” Weinzweig says, “but far more productive than having people passively go along toward a vision of the future that they don’t really buy into.”46

MISSION Mission is not the same thing as a company’s vision, although the two work together. The mission is the organization’s core broad purpose and reason for exis- tence. It defines the company’s core values and reason for being, and it provides a basis for creating the vision. Whereas vision is an ambitious desire for the future, mission is what the organization “stands for” in a larger sense.

What Mission Does Whereas visions grow and change, the mission persists in the face of changing tech- nologies, economic conditions, or other environmental shifts. It serves as the glue that holds the organization together in times of change and guides strategic choices and decisions about the future. The mission defines the enduring character—the spiritual DNA—of the organization.47 The mission that John D. Rockefeller estab- lished for the Rockefeller Foundation—to promote the well-being of mankind throughout the world—still stands 100 years after the organization was founded.48

For Johnson Development Corporation, founded by former basketball star Earvin

406 PART 5 THE LEADER AS SOCIAL ARCHITECT

Mission the organization’s core broad purpose and reason for existence

“Magic” Johnson in 1993 as part of Magic Johnson Enterprises, the mission has always been to be the nation’s foremost development company through enrichment of underserved markets. Some retailers see urban communities as economic waste- lands, but Johnson sees them as lands of opportunity.49

Particularly in today’s environment, people are drawn to companies that have a compelling purpose. Companies with strong missions that give people purpose, such as Medtronic’s “To restore people to full life and health” or Liberty Mutual Company’s “Helping people live safer, more secure lives” typically attract better employees, have better relationships with external parties, and perform better in the marketplace over the long term.50

Recall the discussion of intrinsic rewards from Chapter 8. When people connect their jobs to a higher cause or purpose, the work itself becomes a great motivator. The Gallup organization’s Q12 study, also discussed in Chapter 8, has found that when employees believe the company’s mission makes their job important, they are typically more engaged with their work, feel a greater sense of pride and loyalty, and are more productive. Exhibit 13.5 compares the Gallup results for those who agree that the mission makes their job important to those who do not feel that the mission of the company makes their job important. The differences are quite strik- ing. For example, 60 percent of respondents who agreed that the mission makes their job important reported feeling engaged with their work, whereas none of the respondents who disagreed felt engaged with their work. Sixty-six percent would recommend their company’s products or services, compared to only 20 percent of those who did not believe the mission made their job important.51

Typically, the mission is made up of two critical parts: the core values and the core purpose. The core values guide the organization “no matter what.” The mission also includes the company’s core purpose. Leaders take care when defining a core purpose

EXHIBIT 13.5 The Power of a Strong Mission

Source: Susan Ellingwood, “On a Mission,” Gallup Management Journal (Winter 2001), pp. 6–7.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 407

so that the organization can grow and change. Consider Zenith and Motorola. Both were once successful makers of televisions, but while Zenith stayed there, Motorola continued to move forward to microprocessors, integrated circuits, and other products and became one of the most highly regarded companies in the world. The difference is that Zenith defined its purpose as “making television sets” whereas Motorola defined its purpose as “applying technology to benefit the public.”52

The core values and core purpose are frequently expressed in a mission state- ment. Exhibit 13.6 shows the mission and values for Aflac, an insurance company that serves more than 50 million people around the world. Aflac uses the slogan “We’ve got you under our wing” to encapsulate the company’s commitment to be there for policyholders in their time of need.

A Framework for Noble Purpose An effective mission statement doesn’t just describe products or services; it captures people’s idealistic motivations for why the organization exists. Most successful companies have missions that proclaim a noble purpose of some type, such as Mary Kay’s “to enrich the lives of women,” or Walmart’s mission “to give ordinary folk the chance to buy the same things as rich people.”53

Leaders are responsible for framing a noble purpose that inspires and leads fol- lowers to high performance and helps the organization maintain a competitive

EXHIBIT 13.6 Aflac’s Mission and Values

Mission and Values

We pledge to be there for our policyholders in their time of need.

Aflac's philosophy is to combine innovative strategic marketing with quality products and services at

competitive prices to provide the best insurance value for consumers.

* Building better value for our shareholders.

* Supplying quality service for our agents.

* Providing an enriching and rewarding workplace for our employees.

Source: http://www.aflac.com/aboutaflac/corporateoverview/ourphilosophy.aspx

Great compa- nies must have a noble cause. Then

it’s the leader’s job to transform that noble cause

into such an inspiring vision

that it will attract the most talented

people in the world to want

to join it. Steve Jobs

(1955–2011), cofounder and former

CEO of Apple

408 PART 5 THE LEADER AS SOCIAL ARCHITECT

advantage. As management expert Gary Hamel puts it: “A noble purpose inspires sacrifice, stimulates innovation, and encourages perseverance. In so doing, it trans- forms great talent into exceptional accomplishment.”54 Moreover, a noble purpose uplifts people and gives them a sense that what they are doing matters and makes a positive difference in the world.

Exhibit 13.7 describes four basic approaches leaders take in framing an organi- zational purpose that can tap into people’s desire to contribute and feel that their work is worthwhile.55 Each of these approaches is described in more detail in the following paragraphs.

Discovery Many people are inspired by the opportunity to find or create something new. Discovery for its own sake can serve as a noble purpose, as it does for employ- ees at Google, where people are energized by the psychic rewards they get from working on intellectually stimulating and challenging technical problems.56 As another example, leaders at Samsung Electronics reenergized the company by focus- ing employees on discovery rather than imitation, transforming Samsung into a world-class innovator rather than a manufacturer known for cheap, low-quality knockoffs. Samsung invests heavily in research and development and even began threatening Apple’s dominance in smartphones with the innovative features in its Galaxy S3 and S4 phones. The shift in purpose has led to amazing results at Sam- sung.57 This type of purpose inspires people to see the adventure in their work and experience the joy of a pioneering or entrepreneurial spirit.

Excellence With this approach, rather than emphasizing discovery, leaders focus people on being the best, both on an individual and an organizational level. Allied- Signal’s mission, for example, is to “be one of the world’s premier companies: dis- tinctive and successful in everything we do.”58 For these companies, excellence is defined by the work itself rather than by customers. Indeed, organizations that pur- sue excellence would rather turn customers away than compromise their quality. Consider Apple, another company with excellence as a purpose.59 The company has always built high-quality, cleverly designed computers, yet it holds less than 10 percent of the personal computer market. Leaders would like to increase their share of the market, but they aren’t willing to sacrifice their commitment to high quality and what they consider superior technology.60 In companies with excellence as a guiding purpose, managers and employees are treated as valuable resources

EXHIBIT 13.7 A Leader’s Framework for Noble Purpose

Purpose Description Basis for Action Examples

Discovery Finding the new Pioneer, entrepreneur Google, 3M, Samsung

Excellence Being the best Fulfillment Berkshire Hathaway, AlliedSignal, Apple

Altruism Providing service Happiness Dollar General, Dannon Milk Products

Heroism Being effective Achievement Microsoft, Southwest Airlines, ExxonMobil

Source: Based on Nikos Mourkogiannis, Purpose: The Starting Point of Great Companies (New York: Palgrave Macmillan, 2006); and Nikos Mourkogiannis, “The Realist’s Guide to Moral Purpose,” strategy business Issue 41 (Winter 2005), pp. 42–53.

NEW LEADER ACTION MEMO As a leader, you can keep in mind what the organization stands for in a broader sense— its core purpose and values— and create the vision around that central mission.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 409

and provided with support to perform at their peak. People are motivated by the opportunity to experience intrinsic rewards and personal fulfillment.

Altruism Many nonprofit organizations are based on a noble purpose of altruism because they emphasize serving others, but businesses can use this approach as well. For example, leaders at Dollar General stress the purpose of giving low- income people a good deal, not just making sales and profits. The U.S. division of the giant global food company Danone, Dannon Milk Products, has a mission of “bringing health to the greatest number of people across America through our pro- ducts’ benefits.”61 Even financial services companies, frequently perceived as being exploitative, can operate based on a noble purpose of altruism, as illustrated by Germany’s TeamBank, introduced earlier in the chapter.

IN THE LEAD TeamBank, Volksbanken Raiffeisenbanken Group The vision for TeamBank, “to be a responsible partner for fair consumer financing,” grows out of its mission to serve the country as an honorable financial services company. Leaders at TeamBank, a subsidiary of the German Volksbanken Raiffeisenbanken Group, rejected the assumption that it is impossible for a bank to make money by being fair, and even generous, to its customers.

They overhauled the consumer credit product, called easyCredit, to compete on the concept of fairness rather than price. It offers a 30-day customer retraction period, eliminates the penalty on partial repayments, and offers protection packages that allow for short repay- ment extensions. There are no hidden fees, and terms can be adjusted to reflect unex- pected changes in the borrower’s circumstances. Many credit processes are handled personally so that if people fall behind in making payments, customer advisers can work with them to find a solution rather than threatening them with legal action. When loans become delinquent, TeamBank offers customers the opportunity to make minimal payments that will get them back on the road to financial stability and avoid damaging their credit ratings. “We try to help as long as we see goodwill on the customer’s side,” a manager said. A customer council, made up of 14 volunteer customers and one representative from a consumer protection nongovernmental organization (NGO), provides ongoing feedback to TeamBank leaders about how well the company is living up to its mission and values.

TeamBank rejects profitable products and features that are inconsistent with its values of transparency, honesty, and fairness. Now the number-three consumer finance provider in the German market, TeamBank is both profitable and growing. Moreover, the delinquency rate is much lower than the industry average.62

TeamBank’s mission and values clearly place it in the category of altruism as a guiding purpose. In addition to its business practices, the company provides finan- cial literacy education to high school students all across Germany and sponsors a lecture series on finance and economics for a local university. Any company that puts a high premium on customer service can be considered to fall in this category as well. Marriott, for instance, encapsulates its purpose in the slogan, “The Spirit to Serve.”63 The basis of action for this type of purpose is to increase personal happi- ness. Most people feel good when they are doing something to help others or make their communities or the world a better place.

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Heroism The final category, heroism, means the company’s purpose is based on being strong, aggressive, and effective. Companies with this basis of noble purpose often reflect almost an obsession with winning. Bill Gates imbued Microsoft with a goal of putting the Windows operating system into every personal computer, for example.64 At General Electric, former CEO Jack Welch wanted the company to strive to be number one or number two in each industry in which it did business. As another example, Southwest Airlines was founded with a heroic goal of winning against much larger competitors such as American and Delta. With this approach, the basis of action is people’s desire to achieve and to experience self-efficacy, as described in Chapter 8. People want to feel capable of being effective and producing results.

Companies that remain successful over the long term have leaders who lead with a noble purpose. A well-chosen noble purpose taps into the emotions and instincts of employees and customers and can contribute to better morale, greater innova- tiveness, and higher employee and organizational performance.

THE LEADER AS STRATEGIST-IN-CHIEF Strong missions that reflect a noble purpose and guiding visions are both important, but they are not enough alone to make strong, powerful organizations. For organi- zations to succeed, leaders have to translate vision, values, and purpose into action, which is the role of leader as strategist-in-chief. Strategic management refers to the set of decisions and actions used to formulate and implement specific strategies that will achieve a competitively superior fit between the organization and its environ- ment so as to achieve organizational goals.65

When leaders link vision and strategic action, they can make a real difference for their organization’s future. Research has shown that strategic thinking and plan- ning for the future can positively affect a company’s performance and financial suc- cess.66 One study found that as much as 44 percent of the variance in profitability of major firms can be attributed to strategic leadership.67

How to Achieve the Vision To formulate a strategy, leaders ask questions such as “Where is the organization now? Where does the organization want to be? What changes and trends are occur- ring in the competitive environment? What courses of action can help us achieve our vision?” Strategy can be defined as the general plan of action that describes resource allocation and other activities for dealing with the environment and help- ing the organization attain its goals and achieve the vision. Leaders have to be clear on the organization’s purpose and vision before they can adopt an effective strat- egy. Strategy involves making decisions every day based on what the organization wants to do and be.68

Developing Effective Strategy To develop strategy, leaders actively listen to people both inside and outside the organization, as well as examine trends and discontinu- ities in the environment that can be used to gain an edge. Rather than reacting to environmental changes, strategic leaders study the events that have already taken place and act based on their anticipation of what the future might be like.69 When leaders rely solely on formal strategic planning, competitor analysis, or market research, they miss new opportunities. Consider that when Ted Turner first talked

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Strategic management the set of decisions and actions used to formulate and implement specific strategies that will achieve a competitively superior fit between the organization and its environment so as to achieve organizational goals

Strategy the general plan of action that describes resource allo- cation and other activities for dealing with the environ- ment and helping the orga- nization attain its goals

about launching a 24-hour news and information channel in the 1970s, many dis- missed him as delusional. Every source of conventional wisdom, from market research to broadcast professionals, said the idea was crazy and bound to fail. Yet Turner looked at emerging social and demographic trends, listened to his intuition, and launched a global network that generates 35 percent gross margins. Other media leaders had the same information, but they didn’t interpret it the same way or formulate the same strategy to tap into emerging trends.70 Good leaders antici- pate, look ahead, and prepare for the future based on trends they see in the envi- ronment today, which often requires radical thinking.

Of course, leaders should also use hard analysis to help set a course for the future. They strive to develop industry foresight based on trends in technology, demographics, government regulation, values, and lifestyles that will help them identify new competitive advantages. Situation analysis, for example, includes a search for SWOT—strengths, weaknesses, opportunities, and threats—that affect organizational performance. Leaders using situation analysis obtain external infor- mation from a variety of sources, such as customers, government reports, suppliers, consultants, or association meetings. They gather information about internal strengths and weaknesses from sources such as budgets, financial ratios, profit and loss statements, and employee surveys.

Sometimes leaders have to shift their strategy several times before they get it right.71 In addition, strategy necessarily changes over time to fit shifting environ- mental conditions. Consider Yahoo, which sank into decline because a succession of leaders stuck with an outdated vision and strategy. New CEO Marissa Mayer, who joined the company in mid-2012, hopes to make Yahoo relevant again by refocusing the company around the mission of making the world’s daily habits more inspiring and entertaining.

IN THE LEAD Marissa Mayer, Yahoo Yahoo still commands one of the largest audiences on the Web, but the company has been a “has been” for so long that no one would believe it. New CEO Marissa Mayer does, though, and she thinks her new vision and strategy can jolt the company back to relevance and profitability.

Mark Zuckerberg coined the term “social graph” for Facebook, and Marissa Mayer believes Yahoo can become just as successful by being the world’s “daily interest graph.” To achieve the vision, Mayer’s strategy includes developing products that will help Yahoo “create a complete profile of everything you love,” allowing for more personalized content for users and more lucrative advertising sales for Yahoo. She started by giving Flikr, Yahoo’s neglected photo-sharing service, a much-needed mobile upgrade. In addition, Flikr can now divide people’s uploaded photos into more than 1.6 million minutely specific interest groups. She redesigned the Web site to make it easier for people to connect with the news and information they care about most. The goal is to make the Yahoo experience so easy and appealing that people will return daily. So far, many people are doing just that.

Mayer’s strategy also involves the acquisition of startup companies that are focused on mapping users’ interests. Before Mayer arrived, Yahoo had already acquired IntoNow, which connects users based on the TV shows they watch and love. Mayer has since acquired sev- eral other mobile apps that fit the strategy. The first, On the Air, was started with a mission

NEW LEADER ACTION MEMO As a leader, you can prepare for the future based on trends in the environment today. Don’t be afraid to think radically. You can shift your strategies to fit changing conditions.

412 PART 5 THE LEADER AS SOCIAL ARCHITECT

to make a difference in the daily lives of people, which is a clear fit with Yahoo’s new strat- egy. Others include Stamped, which kept track of restaurants, books, movies, and anything else users liked; Snip.it, which clipped and shared news articles; and Alike, which made res- taurant recommendations based on previous preferences. These acquisitions are being remade into Yahoo products that “will help us build experiences that bring people with shared interests together,” said Mike Kerns, vice president of products.72

Mayer has a tough road ahead, but people both inside and outside of Yahoo believe she has a chance to pull off her ambitious strategy. By linking vision and action, Mayer has “given everybody a sense of hope,” said one Yahoo mobile engineer.73

Elements of Strategy To improve the chances for success, leaders develop strategies that focus on three qualities: core competence, developing synergy, and creating value for customers.

An organization’s core competence is something the organization does extremely well in comparison to competitors. Leaders identify the organization’s unique strengths—what makes their organization different from others in the indus- try. L.L. Bean succeeds with a core competence of excellent customer service and a quality guarantee. Leaders at Family Dollar focus on a core competence of opera- tional efficiency that enables them to keep costs low.

Synergy occurs when organizational parts interact to produce a joint effect that is greater than the sum of the parts acting alone. As a result the organization may attain a special advantage with respect to cost, market power, technology, or employee skills. Synergy was the motivation for Yahoo to buy mobile app startups, for exam- ple, to obtain both the products and the engineering talent. Another way companies gain synergy is through alliances and partnerships. Leaders at Coinstar, the company behind Redbox movie rentals, take this approach. As rentals of physical videos declined the Redbox division partnered with Verizon Communications on a service that combines DVD rental and streaming video, benefiting both companies.74

Focusing on core competencies and attaining synergy help companies create value for their customers. Value can be defined as the combination of benefits received and costs paid by the customer.75 For example, Panera Bread doesn’t have the lowest costs for sandwiches and other food and drink products, but it works hard to create an environment where people want to spend time. “If you give people food they want, in an environment that they want, they will spend a dollar or two more, they will go out of their way for it,” says CEO Ron Shaich.76

Delivering value to the customer is at the heart of strategy. Strategy formulation integrates knowledge of the environment, vision, and mis-

sion with the company’s core competence in such a way as to attain synergy and create value for customers. When these elements are brought together, the company has an excellent chance to succeed in a competitive environment. But to do so, lea- ders have to ensure that strategies are executed—that actual behavior within the organization reflects the desired direction.

How to Execute Strategy execution means that leaders use specific mechanisms, techniques, or tools for directing organizational resources to accomplish strategic goals. This is the basic architecture for how things get done in the organization. Strategy execution,

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Core competence something the organization does extremely well in comparison to competitors

Synergy the interaction of organiza- tional parts to produce a joint effect that is greater than the sum of the parts

Value the combination of benefits received and costs paid by the customer

Strategy formulation integrating knowledge of the environment, vision, and mission with the core com- petence in such a way as to attain synergy and create customer value

Strategy execution putting strategy into action by adjusting various parts of the organization and direct- ing resources to accomplish strategic goals

sometimes called implementation, is the most important as well as the most difficult part of strategic management, and leaders must carefully and consistently manage the execution process to achieve results.77 One survey found that only 57 percent of responding firms reported that managers successfully implemented the new strat- egies they had devised over the past three years.78 Other research has estimated that as much as 70 percent of all business strategies never get implemented, reflecting the complexity of strategy execution.79

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 13.3

Your Strategy Style

Instructions: Think about how you handle challenges and issues in your current or a recent job. Then circle “A” or “B” for each of the following items depending on which is gen- erally more descriptive of your behavior. There are no right or wrong answers. Respond to each item as it best describes how you respond to work situations.

1. When keeping records, I tend to A. be very careful about documentation. B. be more haphazard about documentation.

2. If I run a group or a project, I A. have the general idea and let others figure out how

to do the tasks. B. try to figure out specific goals, time lines, and

expected outcomes. 3. My thinking style could be more accurately described as

A. linear thinker, going from A to B to C. B. thinking like a grasshopper, hopping from one idea

to another. 4. In my office or home, things are

A. here and there in various piles. B. laid out neatly or at least in reasonable order.

5. I take pride in developing A. ways to overcome a barrier to a solution. B. new hypotheses about the underlying cause of

a problem. 6. I can best help strategy by making sure there is

A. openness to a wide range of assumptions and ideas. B. thoroughness when implementing new ideas.

7. One of my strengths is A. commitment to making things work. B. commitment to a dream for the future.

8. For me to work at my best, it is more important to have A. autonomy. B. certainty.

9. I work best when A. I plan my work ahead of time. B. I am free to respond to unplanned situations.

10. I am most effective when I emphasize A. inventing original solutions. B. making practical improvements.

Scoring and Interpretation For Strategic Innovator style, score one point for each “A” answer circled for questions 2, 4, 6, 8, and 10 and for each “B” answer circled for questions 1, 3, 5, 7, and 9. For Strategic Adaptor style, score one point for each “B” answer circled for questions 2, 4, 6, 8, and 10, and for each “A” answer circled for questions 1, 3, 5, 7, and 9. Which of your two scores is higher and by how much? The higher score indicates your Strategy Style.

Strategic Innovator and Strategic Adaptor are two important ways leaders bring creativity to strategic manage- ment. Leaders with an adaptor style tend to work within the situation as it is given and improve it by making it more efficient and reliable. They succeed by building on what they know is true and proven. Leaders with the innovator style push toward a new paradigm and want to find a new way to do something. Innovators like to explore uncharted territory, seek dramatic breakthroughs, and may have diffi- culty accepting an ongoing strategy. Both innovator and adaptor styles are essential to strategic management, but with different approaches. The Strategic Adaptor asks, “How can I make this better?” The Strategic Innovator asks, “How can I make this different?” Strategic Innovators often use their skills in the formulation of whole new strategies, and Strategic Adaptors are often associated with strategic improvements and strategy execution.

If the difference between the two scores is 2 or less, you have a mid-adaptor/innovator style, and work well in both areas. If the difference is 4–6, you have a moderately strong style and probably work best in the area of your strength. And if the difference is 8–10, you have a strong style and almost certainly would want to work in the area of your strength rather than in the opposite domain.

Sources: Adapted from Dorothy Marcic and Joe Seltzer, Organizational Behavior: Experiences and Cases (Cincinnati: South-Western, 1998), pp. 284–287; and William Miller, Innovation Styles (Dallas, TX: Global Creativity Corporation, 1997). The adaptor innovator concepts are from Michael J. Kirton, “Adaptors and Innovators: A Description and Measure,” Journal of Applied Psychology 61, no. 5 (1976), p. 623.

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414 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Leader Tools for Strategy Execution To implement the strategy, leaders make sure they provide followers with line of sight to the organization’s strategic objectives, which means followers understand the goals and how their actions will contribute to achieving them.80 Leaders create the environment that determines whether peo- ple understand and feel committed to achieving strategic objectives. The following techniques can help leaders effectively implement strategy:81

1. Create ongoing communication. Leaders must communicate about the strategy continuously so that people throughout the organization can understand and inter- nalize it. One strategy thinker says effective strategy execution requires that you “communicate 21 times.” When you are “mind-numbingly bored with talking about your strategy,” people will take it seriously and feel confident acting on it.82

2. Teach the “why.” Leaders explain why they decided to do what they are doing. Followers are busy doing the everyday work of the organization and often don’t think about the big picture. Leaders have to persuade people of the busi- ness reasons for the new vision and strategy.

3. Explain what this new thing means to each person. People are often fearful of change, and that includes fear of a new strategic direction. Leaders can antici- pate people’s fears and questions—what will be expected of me? will I lose my job? will my job duties and responsibilities change?—and address them head on. In addition, good leaders ask people what they are thinking and feeling.

4. Tell what is not changing. It is often a good idea to remind employees about company strengths, what is currently working, and what will not change. Peo- ple have a hard time taking in new information when they feel that everything around them is shifting. Leaders give people a “place to stand” by telling them what is not changing.

By following these guidelines, leaders can ensure smoother strategy execution. In addition, a new strategy is implemented through organizational elements such as struc- tural design, pay or reward systems, budget allocations, and organizational rules, poli- cies, or procedures. Leaders make decisions about changes in structure, systems, policies, and so forth, to support the company’s strategic direction. For example, at Home Depot, CEO Frank Blake loosened rules, revised procedures, and shifted reward systems to emphasize quality customer service in support of a strategy that takes Home Depot back to its roots as a source of not only products but also help and information. Blake sold off the wholesale housing supply unit to invest in an “army of orange aprons” and improve customer service at the retail stores.83 John Legere, CEO of T-Mobile, implemented a cost-cutting strategy to improve efficiency and free up cash for investing in new services that can help the number-four wireless carrier in the United States gain more customers and be more competitive. Legere eliminated free sodas in the corporate office and installed vending machines, cut merit-based pay increases, and ended the program that gave long-term employees free phones.84

The Leader as Strategic Decision-Maker Leaders make decisions every day—some large and some small—that support company strategy. Exhibit 13.8 provides a sim- plified model for how leaders make strategic decisions. The two dimensions consid- ered are whether a particular choice will have a high or low strategic impact on the business and whether execution of the decision will be easy or difficult. A change that both produces a high strategic impact and is easy to execute would be a leader’s first choice for putting strategy into action. For example, when CEO Shigetaka Komori

NEW LEADER ACTION MEMO Strategic management is one of the most critical jobs of a leader, but leaders may exhibit different strategy styles that can be effective. Leader’s Self- Insight 13.3 lets you determine your strengths based on two important ways leaders can bring creativity to strategic management.

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and other leaders at Fujifilm saw the digital age surging toward them, they knew the company had to transform to survive. An easy decision was to begin cutting resources going toward the film business and shift them into digital photography.85

This had a big strategic impact and was relatively easy to implement. Some strategic decisions, however, are much more difficult to execute. For exam-

ple, maintaining revenue and pursuing growth meant Fujifilm needed to find new areas of business or grow through mergers and acquisitions. The latter approach can present difficulties of blending production processes, accounting procedures, corporate cultures, and other aspects of the organizations into an effectively functioning whole. Komori and other leaders pumped resources into R&D to begin developing existing technologies into new businesses, including films used for LCD panels and television sets, chemicals for cosmetics, and even drugs and health care. This last endeavor even- tually led them to begin acquiring health care companies, such as drug maker Toyama Chemical Company and U.S. medical-equipment manufacturer SonoSite Inc. Although these decisions were high-risk, the potential impact was tremendous. Leaders fre- quently initiate major changes despite the risks and difficulties because the potential strategic payoff is very high. For example, at Fuji, the health-care operation is a grow- ing part of the overall business.86

Leaders also sometimes pursue activities that have a low strategic impact but which are relatively easy to execute. Incremental improvements in products, work pro- cesses, or techniques are examples. Over time, incremental improvements can have an important effect on the organization. In addition, small changes can symbolize improvement and success to people within the organization. It may be important for leaders to produce quick, highly visible improvements to boost morale, keep people committed to larger changes, or keep followers focused on the vision. For example, the manager of a purchasing department wanted to re-engineer the purchasing process to increase efficiency and improve relationships with suppliers. He wanted requisitions and invoices to be processed within days rather than the several weeks it had been tak- ing. Employees were skeptical that the department could ever meet the new standards and pointed out that some invoices currently awaiting processing were almost two

EXHIBIT 13.8 Making Strategic Decisions

Source: Adapted from Amir Hartman and John Sifonis, with John Kador, Net Ready: Strategies for the New E-conomy (New York: McGraw-Hill, 2000), p. 95.

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months old. The manager decided to make some simple revisions in the flow of paper- work and employee duties, which enabled the department to process all the old invoices so that no remaining invoice was more than a week old. This “small win” energized employees and helped keep them focused on the larger goal.87 The positive attitude made execution of the larger change much smoother.

The final category shown in Exhibit 13.8 relates to changes that are both diffi- cult to execute and have low strategic impact. An illustration of a decision in this category was the attempt by new management at a highly successful mail-order clothing company to implement teams. In this case, the decision was not made to support a new strategic direction but simply to try out a new management trend— and it was a miserable failure that cost the organization much time, money, and employee goodwill before the teams were finally disbanded.88 Effective leaders try to avoid making decisions that fall within this category.

Although good leadership calls for actively involving everyone, leaders are still ultimately responsible for establishing direction through vision and strategy. When leadership fails to provide direction, organizations flounder. To keep organizations competitive, leaders consciously adopt a focused vision and strategy and make sure everyone’s activities move the organization in the right direction.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • Leaders establish organizational direction through vision and strategy. They are

responsible for studying the organization’s environment, considering how it may be different in the future, and setting a direction everyone can believe in. The shared vision is an attractive, ideal future for the organization that is cred- ible yet not readily attainable. Leaders make a real difference for their organi- zation when they link vision to strategic action, so that vision is more than just a dream. Superior organizational performance is not a matter of luck. It is determined by the decisions leaders make.

• A clear, powerful vision links the present and the future, energizes employees and focuses attention, and gives people an inspiring picture of the future to which they are eager to commit themselves. The vision can also give meaning to work and establish a standard of excellence by presenting a challenge that asks all workers to give their best.

• The mission includes the company’s core values and its core purpose or reason for existence. Visions for the future change, whereas the mission should persist, as a reflection of the enduring character of the organization. Effective leaders frame a noble purpose that inspires followers and helps the organization main- tain a competitive advantage. To frame an organizational purpose that helps people find their work meaningful, leaders can choose among four basic con- cepts as the basis of purpose: discovery, excellence, altruism, and heroism.

• Strategic management is the serious work of figuring out how to translate vision and mission into action. Strategy is a general plan of action that describes resource allo- cation and other activities for dealing with the environment and helping the organi- zation reach its goals. Like vision, strategy changes, but successful companies

Tw itt er

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develop strategies that focus on core competence, develop synergy, and create value for customers. Strategy is executed through the systems and structures that are the basic architecture for how things get done in the organization.

DISCUSSION QUESTIONS 1. A management consultant said that strategic leaders are concerned with vision and mis-

sion, while strategic managers are concerned with strategy. Do you agree? Discuss.

2. A vision can apply to an individual, a family, a college course, a career, or decorating an apartment. Think of something you care about for which you want the future to be different from the present and write a vision statement for it.

3. If you worked for a company like Amazon or Google that has a strong vision for the future, how would that affect you compared to working for a company that did not have a vision?

4. Do you agree with the principle of self-reference? In other words, do you believe if peo- ple know where the organization is trying to go, they will make decisions that support the desired organizational outcome?

5. What does it mean to say that the vision can include a description of both the journey and the destination?

6. Many visions are written and hung on a wall. Do you think this type of vision has value? What would be required to imprint the vision within each person?

7. Do you think most employees know what the mission of their company is? Suggest some ways leaders can effectively communicate the mission to people both inside and outside the organization.

8. Do you think every organization needs a noble purpose in order to be successful over the long term? Discuss. Name one company that seems to reflect each category of noble purpose as defined in the chapter.

9. Strategic vision and strategic action are both needed for a leader to be effective. Which do you think you are better at doing? Why?

10. If vision is so important, why do analysts and commentators sometimes criticize a new CEO’s emphasis on formulating a vision for a company that is struggling to survive? Discuss.

Complete this assignment online with CengageNOW.

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LEADERSHIP AT WORK Future Thinking Think of some problem you have in your life right now. It could be any problem you are having at school, home, or work that you would like to solve. Write a few words that sum- marize the problem:

Now write brief answers to the following questions for that specific problem. (Do not look ahead to the next set of four questions. This exercise is more effective if the questions are seen in sequence.)

418 PART 5 THE LEADER AS SOCIAL ARCHITECT

1. Why do I have this problem?

2. Who/what caused this problem?

3. What stands in the way of a solution?

4. How likely is it that I’ll solve this problem?

5. After you have answered these four questions, write down what are you feeling about the problem.

Now, for the same problem, write brief answers to the following four questions.

1. What do I really want instead of this problem? (Your answer equals your desired future outcome.)

2. How will I know I’ve achieved this future outcome? (What will I see, hear, and feel?)

3. What resources do I need to pursue this future outcome?

4. What is the first step I can take to achieve this outcome?

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 419

5. After you have answered these four questions, what are you feeling about the problem?

The human mind is effective at focusing on problems to diagnose what is wrong and who is to blame. The first four questions reflect that approach, which is called problem- focused thinking.

The second set of four questions reflects a different approach, called outcome-directed thinking. It focuses the mind on future outcomes and possibilities rather than on the causes of the problem. Most people feel more positive emotion, more creative ideas, and more opti- mism about solving the problem after answering the second four questions compared to the first four questions. Shifting the mind to the future harnesses the same power that a vision has to awaken creativity and inspire people to move forward. Future thinking is using the idea of future vision on a small, day-to-day scale.

In Class: This exercise is very effective when each student selects a problem, and then stu- dents interview each other about their problems. Students should work in pairs—one acting the role of leader and the other acting as a subordinate. The subordinate describes his or her problem (one minute), and then the leader simply asks the first four questions (changing each “I” to “you”) and listens to the answers (four minutes). Then the two students can switch leader/subordinate roles and repeat the process for the same four questions. The instructor can then gather students’ observations about what they felt when answering the four questions.

Then, students can be instructed to find a new partner, and the pairs can again adopt the role of leader and subordinate. The subordinate will relate the same problem as before to the leader, but this time the leader will ask the second four questions (outcome-directed thinking, again changing each “I” to “you”). After the subordinate answers the four ques- tions, the pair switches leader/subordinate roles and repeats the process. Then the instructor can ask for student observations about how they felt answering these four questions com- pared to the first four questions. Generally the reaction is quite positive. The key questions for students to consider are: How did the questions about future outcomes affect your crea- tive thoughts for solving the problem compared to the first four questions that were problem-oriented? As a leader, can you use future-oriented questions in your daily life to shape your thinking and the thinking of others toward more creative problem solving? Future-oriented thinking is a powerful leadership tool.

Sources: This approach to problem solving was developed by Robert P. Bostrom and Victoria K. Clawson of Bostrom and Associates, Columbia, Missouri, and this exercise is based on a write-up appearing in Inside USAA, the company news- letter of USAA (September 11, 1996), pp. 8–10; and Victoria K. Clawson and Robert P. Bostrom, “Research-Driven Facilitation Training for Computer-Supported Environments,” Group Decision and Negotiation 5 (1996), pp. 7–29.

Check out CengageNOW for additional cases with interactive activities.

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LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS The New Museum The recently completed new building to house the exhibits and staff of the Central City Museum was located adjacent to the campus of a private university. The new building was financed by the generosity of local donors. The university provided the land and would cover annual operating expenses with the understanding that the museum would provide a

420 PART 5 THE LEADER AS SOCIAL ARCHITECT

resource for student education. The new governing board would be made up of key donors as well as selected university administrators and faculty members.

The planning committee of the governing board hired two business students to inter- view various stakeholders about the future direction of the museum in its new relation- ship with the university. These interviews were conducted in person, and the interviewees seemed uniformly interested and eager to help. The major questions pertained to the future mission and goals for the museum. Some excerpts from the interviews are listed below.

A major donor: I think the museum should be a major community resource. My wife and I gave money for the new building with the expectation that the museum would pro- mote visits from the public schools in the area, and particularly serve the inner-city children who don’t have access to art exhibits. We don’t want the museum to be snobbish or elitist. The focus should definitely be local.

A university administrator: The important thing is to have lively contemporary exhibits that will attract both university students and community adults and provide new insight and dialogue about current events. We can bring attention to the museum by having an occa- sional controversial exhibit, such as on Islamic art, and exhibits that appeal to Hispanics and African Americans. This approach would entail bringing in traveling exhibitions from major museums, which would save the administrative costs and overhead of producing our own exhibits.

Head of the art history department: The key thing is that the museum will not have the artistic resources or the financial resources to serve the community at large. We have a won- derful opportunity to integrate the museum with the academic faculty and make it a teaching institution. It can be a major resource for both undergraduate and graduate students in art education and art history. We can also work with engineering students, architecture stu- dents, and liberal arts students. This is a unique opportunity that will distinguish our art his- tory department’s teaching mission from others in the country.

A faculty member in the art history department: The best use of the museum’s rela- tionship with the university is to concentrate on training Ph.D.-level students in art his- tory and to support scholarly research. I strongly urge the museum to focus on graduate education, which would increase the stature of the university nationally. Graduate stu- dents would be involved in the design of exhibits that would fit their research. Trying to make the museum popular on campus or in the community will waste our limited resources. Our Ph.D. graduates will be sought after by art history departments through- out the country.

The reason you have been given this information from the interviews is that you have been invited to interview for the position of museum director. The previous director retired with the understanding that a new director would be hired upon the completion of fundrais- ing and construction of the new building. You are thinking about what you would do if you took the job.

QUESTIONS

1. What mission for the Central City Museum do you personally prefer? As Director, would you try to implement your preferred mission? Explain.

2. How would you attempt to resolve the underlying conflicts among key stakeholders about the museum’s purpose and direction?

3. What actions would you take to implement the mission you decide to adopt? Be specific.

The Visionary Leader When Frank Coleman first began his job as president of Hi-Tech Aerostructures, most man- agers and employees felt a surge of hope and excitement. Hi-Tech Aerostructures is a 50- year-old, family-owned manufacturing company that produces parts for the aircraft industry. The founder and owner had served as president until his health began to decline, and he felt

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 421

the need to bring in someone from outside the company to get a fresh perspective. It was cer- tainly needed. Over the past several years, Hi-Tech had just been stumbling along.

Coleman came to the company from a smaller business, but one with excellent creden- tials as a leader in advanced aircraft technology. He had a vision for transforming Hi-Tech into a world-class manufacturing facility. In addition to implementing cutting-edge technol- ogy, the vision included transforming the sleepy, paternalistic culture to a more dynamic, adaptive one and empowering employees to take a more active, responsible role in the orga- nization. After years of just doing the same old thing day after day, vice president David Deacon was delighted with the new president and thrilled when Coleman asked him to head up the transformation project.

Deacon and his colleagues spent hours talking with Coleman, listening to him weave his ideas about the kind of company Hi-Tech could become. He assured the team that the transformation was his highest priority, and he inspired them with stories about the sig- nificant impact they were going to have on the company as well as the entire aircraft industry. Together, the group crafted a vision statement that was distributed to all employees and posted all over the building. At lunchtime, the company cafeteria was abuzz with talk about the new vision. And when the young, nattily dressed president him- self appeared in the cafeteria, as he did once every few weeks, it was almost as if a rock star had walked in.

At the team’s first meeting with Coleman, Deacon presented several different ideas and concepts they had come up with, explaining the advantages of each for ripping Hi-Tech out of the past and slamming it jubilantly into the twenty-first century. Nothing, however, seemed to live up to Coleman’s ambitions for the project—he thought all the suggestions were either too conventional or too confusing. After three hours the team left Coleman’s office and went back to the drawing board. Everyone was even more fired up after Cole- man’s closing remarks about the potential to remake the industry and maybe even change the world.

Early the next day, Coleman called Deacon to his office and laid out his own broad ideas for how the project should proceed. “Not bad,” thought Deacon, as he took the notes and drawings back to the team. “We can take this broad concept and really put some plans for action into place.” The team’s work over the next few months was for the most part lively and encouraging. Whenever Coleman would attend the meetings, he would suggest changes in many of their specific plans and goals, but miraculously, the transformation plan began to take shape. The team sent out a final draft to colleagues and outside consultants, and the feedback was almost entirely positive.

The plan was delivered to Coleman on a Wednesday morning. When Deacon had still not heard anything by Friday afternoon, he began to worry. He knew Coleman had been busy with a major customer, but the president had indicated his intention to review the plan immediately. Finally, at 6 P.M., Coleman called Deacon to his office. “I’m afraid we just can’t run with this,” he said, tossing the team’s months of hard work on the desk. “It’s just … well, just not right for this company.”

Deacon was stunned. And so was the rest of the team when he reported Coleman’s reac- tion. In addition, word was beginning to get out around the company that all was not smooth with the transformation project. The cafeteria conversations were now more likely to be gripes that nothing was being done to help the company improve. Coleman assured the team, however, that his commitment was still strong; they just needed to take a different approach. Deacon asked that Coleman attend as many meetings as he could to help keep the team on the right track. Nearly a year later, the team waited in anticipation for Coleman’s response to the revised proposal.

Coleman called Deacon at home on Friday night. “Let’s meet on this project first thing Monday morning,” he began. “I think we need to make a few adjustments. Looks like we’re more or less headed in the right direction, though.” Deacon felt like crying as he hung up the phone. All that time and work. He knew what he could expect on Monday morning. Cole- man would lay out his vision and ask the team to start over.

422 PART 5 THE LEADER AS SOCIAL ARCHITECT

QUESTIONS

1. How effective would you rate Coleman as a visionary leader? Discuss.

2. Where would you place Coleman on the chart of types of leaders in Exhibit 13.1? Where would you place Deacon?

3. If you were Deacon, what would you do?

Sources: Based on “The Vision Failed,” Case 8.1 in Peter G. Northouse, Leadership—Theory and Practice, 2nd ed. (Thousand Oaks, CA: Sage Publications, 2001), pp. 150–151; Joe Kay, “My Year at a Big High Tech Company,” Forbes ASAP (May 29, 2000), pp. 195–198; “Digital Diary (My Year at a Big High Tech Company),” http://www.forbes.com/ asap/2000 (accessed November 19, 2000); and “Digital Diary, Part Two: The Miracle,” Forbes ASAP (August 21, 2000), pp. 187–190.

REFERENCES 1. Brian O’Keefe, “Leader of the Crimson Tide,” Fortune (September 24,

2012), pp. 150–160.

2. This image comes from Lisa Haneburg, “Recalculating the Route,” The Conference Board Review (March–April 2009), p. 13.

3. Keith H. Hammonds, “The Monroe Doctrine,” Fast Company (October 1999), pp. 230–236.

4. Quoted in Pat McHenry Sullivan, “Finding Visions for Work and Life,” Spirit at Work (April 1997), p. 3.

5. R. Duane Ireland and Michael A. Hitt, “Achieving and Maintaining Strategic Competitiveness in the 21st Century: The Role of Strategic Leadership,” Academy of Management Executive 13, no. 1 (1999), pp. 43–57; M. Davids, “Where Style Meets Substance,” Journal of Business Strategy 16, no. 1 (1995), pp. 48–60; and R. P. White, P. Hodgson, and S. Crainer, The Future of Leadership (London: Pitman Publishing, 1997).

6. Ireland and Hitt, “Achieving and M aintaining Strategic Competitiveness.”

7. Louisa Wah, “The Dear Cost of ‘Scut Work,’ ” Management Review (June 1999), pp. 27–31.

8. Gary Hamel and C. K. Prahalad, “Seeing the Future First,” Fortune (September 5, 1994), pp. 64–70.

9. Ray Maghroori and Eric Rolland, “Strategic Leadership: The Art of Balancing Organizational Mission with Policy, Procedures, and External Environment,” The Journal of Leadership Studies 4, no. 2 (1997), pp. 62–81.

10. Pieter Klaas Jagersma, “Aspiration and Leadership,” Journal of Business Strategy 28, no. 1 (2007), pp. 45–52.

11. This discussion is based heavily on Paul J. H. Schoemaker, Steve Krupp, and Samantha Howland, “Strategic Leadership: The Essential Skills,” Harvard Business Review (January–February, 2013), pp. 131–134.

12. Adam Bryant, “The Importance of Painting a Clear Picture” (an interview with John Riccitiello), The New York Times (November 26, 2011), http://www.nytimes.com/2011/11/27/business/electronic-arts- chief-on-painting-a-consistent-picture.html?pagewanted=all&_r=0 (accessed June 4, 2013).

13. Daniel Nye Griffiths, “John Riccitiello Steps Down as EA CEO— Why, and What Now?” Forbes (March 18, 2013), http://www.forbes. com/sites/danielnyegriffiths/2013/03/18/john-riccitiello-steps-down- as-ea-ceo/ (accessed June 4, 2013); and Kim-Mai Cutler, “EA CEO John Riccitiello Steps Down over ‘Shortcomings’ in Financial Performance,” TechCrunch (March 18, 2013), http://techcrunch. com/2013/03/18/ea-ceo-john-riccitiello-steps-down-larry-probst- becomes-executive-chairman/ (accessed June 4, 2013).

14. Conference Board study, reported in John J. Sosik, Don I. Jung, Yair Berson, Shelley D. Dionne, and Kimberly S. Jaussi, “Making All the Right Connections: The Strategic Leadership of Top Executives in High-Tech Organizations,” Organizational Dynamics 34, no. 1 (2005), pp. 47–61.

15. Burt Nanus, “Leading the Vision Team,” The Futurist (May–June 1996), pp. 20–22; Warren Bennis and Burt Nanus, Leaders: The Strategies for Taking Charge (New York: Harper & Row, 1985); and Burt Nanus and Stephen M. Dobbs, Leaders Who Make a Difference: Essential Strategies for Meeting the Non-Profit Challenge (San Francisco: Jossey-Bass, 1999).

16. R. J. Baum, E. A. Locke, and S. Kirkpatrick, “A Longitudinal Study of the Relations of Vision and Vision Communication to Venture Growth in Entrepreneurial Firms,” Journal of Applied Psychology 83 (1998), pp. 43–54; studies reported in Anthony Bell, “Using Vision to Shape the Future,” Leader to Leader (Summer 2007), pp. 17–21; and Sharda Prashad, “The Value Chain,” Canadian Business (February 17–March 2, 2009), pp. 65–69.

17. Nathaniel Foote, Russell Eisenstat, and Tobias Fredberg, “The Higher Ambition Leader,” Harvard Business Review (September 2011), pp. 94–101.

18. Roger Thurow, “Different Recipe; To Tackle Hunger, a Food Bank Tries Training Chefs,” The Wall Street Journal (November 28, 2006), pp. A1, A13; and Joseph Weber, “Waging War on Hunger,” BusinessWeek (May 16, 2005), pp. 94, 96.

19. Andrea Kilpatrick and Les Silverman, “The Power of Vision,” Strategy & Leadership 33, no. 2 (2005), pp. 24–26.

20. Andrew Douglas, John O. Burtis, and L. Kristine Pond-Burtis, “Myth and Leadership Vision: Rhetorical Manifestation of Cultural Force,” The Journal of Leadership Studies 7, no. 4 (2001), pp. 55–69.

21. This section is based on Burt Nanus, Visionary Leadership (San Francisco: Jossey-Bass, 1992), pp. 16–18; and Richard L. Daft and Robert H. Lengel, Fusion Leadership: Unlocking the Subtle Forces That Change People and Organizations (San Francisco: Berrett- Koehler, 1998).

22. Alan Deutschman, “Can Google Stay Google?” Fast Company (August 2005), pp. 62–68.

23. Oren Harari, “Looking Beyond the Vision Thing,” Management Review (June 1997), pp. 26–29; and William D. Hitt, The Leader- Manager: Guidelines for Action (Columbus, OH: Battelle Press, 1988), p. 54.

24. Nancy Chambers, “The Really Long View,” Management Review (January 1998), pp. 11–15; and Arie de Geus, “The Living Company,” Harvard Business Review (March–April 1997), pp. 51–59.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 423

25. Robert S. Kaplan, “What to Ask the Person in the Mirror,” Harvard Business Review (January 2007), pp. 86–95.

26. Matthew E. May, “The Art of Adding by Taking Away,” The New York Times (January 19, 2013), http://www.nytimes.com/2013/01/ 20/jobs/matthew-may-on-the-art-of-adding-by-taking-away.html? _r=0 (accessed January 20, 2013).

27. Christoph H. Loch, Fabian J. Sting, Arnd Huchzermeier, and Christiane Decker, “Finding the Profit in Fairness,” Harvard Business Review (September 2012), pp. 111–115.

28. Nanus, Visionary Leadership, p. 16; and Gregory Gull, “Gravity of Vision: It Brings Unity or Wholeness,” Leadership Excellence (February 2012), p. 16.

29. James C. Collins and Jerry I. Porras, “Building Your Company’s Vision,” Harvard Business Review (September–October 1996), pp. 65–77 (quote on p. 74).

30. Roger E. Herman and Joyce L. Gioia, “Making Work Meaningful: Secrets of the Future-Focused Corporation,” The Futurist (December 1998), pp. 24–26.

31. “What I Know Now,” an interview with Michael L. Eskew by Paul B. Brown, Fast Company (November 2008), p. 108.

32. Antoine Saint-Exupery, Pilote de Guerre (1942); as quoted in Michael M. Reuter and John H. Shannon, “Leadership Think: Imagine the Unimaginable,” Leadership Excellence (November 2012), p. 8.

33. James M. Kouzes and Barry Z. Posner, The Leadership Challenge: How to Get Extraordinary Things Done in Organizations (San Francisco: Jossey-Bass, 1988), p. 98.

34. Marshall Sashkin, “The Visionary Leader,” in Jay Conger and Rabindra N. Kanungo, eds., Charismatic Leadership: The Elusive Factor in Organizational Effectiveness (San Francisco: Jossey-Bass, 1988), pp. 122–160.

35. James C. Collins and Jerry I. Porras, “Organizational Vision and Visionary Organizations,” California Management Review (Fall 1991), pp. 30–52.

36. Vernon Clark quoted in Michael Lee Stallard and Jason Pankau, “To Boost Performance, Connect with the Core,” Leader to Leader (Summer 2010), pp. 51–57.

37. Brad Stone, “The Omnivore,” Bloomberg BusinessWeek (October 3–9, 2011), pp. 58–65.

38. Neville Pritchard, “Commitment to Purpose—The Catalyst for Organisation Change and Performance,” Industrial and Commercial Training 42, no. 7 (2010), pp. 360–365.

39. Nanus, Visionary Leadership, p. 26; John W. Gardner, “Leadership and the Future,” The Futurist (May–June 1990), pp. 9–12; and Bennis and Nanus, Leaders: The Strategies for Taking Charge, p. 93.

40. Gardner, “Leadership and the Future.”

41. Don Clark, “Boss Talk: Qualcomm CEO Envisions Cell Base Stations in Your Home,” The Wall Street Journal (December 11, 2012), http:// online.wsj.com/article/SB10001424127887324339204578173332194 107300.html (accessed June 3, 2013).

42. Gregory Gull, “Lead with Vision: Develop Your Thinking Skills,” Leadership Excellence (November 2011), p. 9; and Dave O’Connell, Karl Hickerson, and Arun Pillutla, “Organizational Visioning: An Integrative Review,” Group & Organization Management 36, no. 1 (2011), pp. 103–125.

43. Peter M. Senge, The Fifth Discipline: The Art and Practice of the Learning Organization (New York: Doubleday/Currency, 1990), pp. 205–225.

44. This is based on Tara Jones, “What’s Your Vision?” Leadership Excellence (March 2010), pp. 6–7; James M. Kouzes and Barry Z. Posner, “To Lead, Create a Shared Vision,” Harvard Business Review (January 2009), pp. 20–21; Robert P. Hewes, “Power of Visioning,” Leadership Excellence (October 2012), p. 14; and Ari Weinzweig, “Step

into the Future,” Inc. (February 2011), http://www.inc.com/magazine/ 20110201/creating-a-company-vision.html (accessed June 4, 2013).

45. Donald T. Phillips, Lincoln on Leadership: Executive Strategies for Tough Times (New York: Warner Books, 1992), pp. 162–165.

46. Weinzweig, “Step into the Future”; “About Us,” ZingTrain, Zinger- man’s Web site, http://www.zingtrain.com/about-us/ (accessed June 4, 2013); Micheline Maynard, “The Corner Deli That Dared to Break Out of the Neighborhood,” The New York Times (May 3, 2007), p. C1; and Bo Burlingham, “The Coolest Small Company in America,” Inc. (January 2003), pp. 65–74.

47. Susan Ellingwood, “On a Mission,” Gallup Management Journal (Winter 2001), pp. 6–7; and Jim Collins, “What Do You Stand For? It’s Not Just about What You Make,” Leadership Excellence (October 2011), p. 5.

48. Judith Rodin, “Anniversaries Are Not to Be Wasted,” Harvard Business Review (November 2012), p. 36.

49. Stephen Xavier, “Great Leaders,” Leadership Excellence (December 2010), p. 13.

50. Bill George, “The Company’s Mission Is the Message,” strategy business 33 (Winter 2003), pp. 13–14; and Jim Collins and Jerry Porras, Built to Last: Successful Habits of Visionary Companies (New York: HarperBusiness, 1994).

51. Ellingwood, “On a Mission.”

52. Collins “What Do You Stand For?”

53. Art Kleiner, George Roth, and Nina Kruschwitz, “Should a Company Have a Noble Purpose?” The Conference Board Review (January– February 2001).

54. Gary Hamel, “Hole in the Soul: Leaders Either Cause It or Fix It,” Leadership Excellence (October 2011), p. 3.

55. This discussion is based on Nikos Mourkogiannis, “The Realist’s Guide to Moral Purpose,” strategy+business 41 (Winter 2005), pp. 42–53; and Nikos Mourkogiannis, “Purpose: The Starting Point of Great Leadership,” Leader to Leader (Spring 2007), pp. 26–32.

56. Deutschman, “Can Google Stay Google?”

57. Brian X. Chen, “Samsung Emerges as a Potent Rival to Apple’s Cool,” The New York Times (February 10, 2013), http://www. nytimes.com/2013/02/11/technology/samsung-challenges-apples- cool-factor.html?pagewanted=all (accessed February 11, 2013); Bill Breen, “The Seoul of Design,” Fast Company (December 2005), pp. 90–99; and Peter Lewis, “A Perpetual Crisis Machine,” Fortune (September 19, 2005), pp. 58–76.

58. Cited in David K. Carr, Kelvin J. Hard, and William J. Trahant, Managing the Change Process: A Field Book for Change Agents, Consultants, Team Leaders, and Reengineering Managers, Exhibit 6.2 (New York: McGraw Hill, 1996).

59. Mourkogiannis, “Purpose: The Starting Point of Great Leadership.”

60. Steve Lohr, “Apple, a Success at Stores, Bets Big on Fifth Avenue,” The New York Times (May 19, 2006), p. C1; and Michael V. Copeland, “The Apple Ecosystem,” Fortune (November 23, 2009), pp. 102–109.

61. Reported in Douglas A. Ready and Emily Truelove, “The Power of Collective Ambition,” Harvard Business Review (December 2011), pp. 94–102.

62. Loch et al., “Finding the Profit in Fairness.”

63. Mourkogiannis, “The Realist’s Guide to Moral Purpose.”

64. Ibid.

65. John E. Prescott, “Environments as Moderators of the Relationship between Strategy and Performance,” Academy of Management Journal 29 (1986), pp. 329–346.

66. C. Chet Miller and Laura B. Cardinal, “Strategic Planning and Firm Performance: A Synthesis of More Than Two Decades of Research,” Academy of Management Journal 37, no. 6 (1994), pp. 1649–1665.

424 PART 5 THE LEADER AS SOCIAL ARCHITECT

67. Sydney Finkelstein and Donald C. Hambrick, Strategic Leadership: Top Executives and Their Effect on Organizations (St. Paul, MN: West Publishing, 1996), p. 23.

68. Cynthia A. Montgomery, “Strategist-in-Chief,” Leadership Excel- lence (July 2012), p. 12.

69. Ireland and Hitt, “Achieving and Maintaining Strategic Competitiveness.”

70. Oren Harari, “Catapult Your Strategy over Conventional Wisdom,” Management Review (October 1997), pp. 21–24.

71. Christopher Hoenig, “True Grit,” CIO (May 1, 2002), pp. 50–52.

72. Sarah Kessler, “Exposing Yahoo’s Strategy,” Fast Company (April 2013), pp. 40, 45; and Nicole Perlroth, “The Chief of Yahoo Lifts Sales, and Spirits,” The New York Times (January 28, 2013), http:// www.nytimes.com/2013/01/29/technology/yahoo-earnings-beat-forecasts. html?_r=0 (accessed June 4, 2013).

73. Kessler, “Exposing Yahoo’s Strategy.”

74. Nick Wingfield, “Thinking Outside the Redbox,” The New York Times (February 18, 2012), p. B1.

75. Gregory M. Bounds, Gregory H. Dobbins, and Oscar S. Fowler, Management: A Total Quality Perspective (Cincinnati, OH: South- Western, 1995), p. 244; and Michael Treacy, “You Need a Value Discipline—But Which One?” Fortune (April 17, 1995), p. 195.

76. “Not by Bread Alone” (an interview with Ron Shaich by Corey Hajim), Fortune (July 10, 2006), p. 126.

77. L. J. Bourgeois III and David R. Brodwin, “Strategic Implementation: Five Approaches to an Elusive Phenomenon,” Strategic Management Journal 5 (1984), pp. 241–264; Anil K. Gupta and V. Govindarajan, “Business Unit Strategy, Managerial Characteristics, and Business Unit Effectiveness at Strategy Implementation,” Academy of Manage- ment Journal 27, no. 1 (1984), pp. 25–41; and Michael K. Allio, “A

Short Practical Guide to Implementing Strategy,” Journal of Business Strategy 26, no. 4 (2005), pp. 12–21.

78. 2004 Economist survey, reported in Allio, “A Short, Practical Guide to Implementing Strategy.”

79. M. Corboy and D. O’Corrbui, “The Seven Deadly Sins of Strategy,” Management Accounting 77, no. 10 (1999), pp. 29–33.

80. Wendy R. Boswell, John B. Bingham, and Alexander J. S. Colvin, “Aligning Employees through ‘Line of Sight,’ ” Business Horizons 49 (2006), pp. 499–509.

81. These are based largely on Patty Azzarello, “New Strategy? How Can You Execute It,” Leadership Excellence (May 2012), p. 17.

82. Azzarello, “New Strategy?”

83. Jennifer Reingold, “Home Depot’s Total Rehab,” Fortune (September 29, 2008), pp. 159–166.

84. Thomas Gryta, “T-Mobile’s CEO Looks for Pennies to Pinch,” The Wall Street Journal (May 7, 2013), http://online.wsj.com/article/ S B1 0 0 0 1 4 2 4 1 2 7 8 8 7 3 2 4 5 8 2 0 0 4 5 7 8 4 6 1 3 4 0 8 4 1 2 7 0 1 4 4 .h tml (accessed June 4, 2013).

85. Kana Inagaki and Juro Osawa, “Fujifilm Thrived by Changing Focus; CEO Says Firm, Kodak Saw Digital Age Coming, ‘The Question Was, What to Do about It,’ ” The Wall Street Journal (January 20, 2012), http://online.wsj.com/article/SB100014240529702037504045771 70481473958516.html (accessed June 4, 2013).

86. Ibid.

87. Thanks to Russell Guinn for the story on which this example is based.

88. Based on Gregory A. Patterson, “Land’s End Kicks Out Modern New Managers, Rejecting a Makeover,” The Wall Street Journal (April 3, 1995), pp. A1, A6.

CHAPTER 13 CREATING VISION AND STRATEGIC DIRECTION 425

Chapter 14: Shaping Culture and Values

Ed w ar de s/ St on e/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Understand why shaping culture is a vital function of leadership. • Recognize the characteristics of a responsive, as opposed to a resistant, culture. • Know how to establish a high-performance culture by paying attention to both values and results. • Understand and apply how leaders shape culture and values through ceremonies, stories, symbols,

language, selection and socialization, and daily actions.

• Identify the cultural values associated with adaptability, achievement, involvement, and consistency cultures and the environmental conditions associated with each.

• Act as a values-based leader and instill healthy values in the organizational culture. • Apply the principles of spiritual leadership to help people find deeper life meaning and a sense of

membership through work.

CHAPTER OUTLINE 428 Organizational Culture

433 Culture Strength, Responsive- ness, and Performance

438 Cultural Leadership

441 The Competing Values Approach to Shaping Culture

446 Ethical Values in Organizations

447 Values-Based Leadership

In the Lead

431 Flint Lane, Billtrust

437 Menlo Innovations

444 Aaron Levie, Box

446 Harvard Business School, Columbia Business School, Yale School of Management, Wharton School of the University of Pennsylvania

447 Jim Sinegal and Craig Jelinek, Costco

Leader’s Self-Insight

434 Working in a Responsive Culture

443 Culture Preference Inventory

449 How Spiritual Are You?

Leader’s Bookshelf

429 I’m Feeling Lucky: The Confessions of Google Employee Number 59

Leadership at Work

452 Walk the Talk

Leadership Development: Cases for Analysis

454 Culture Clash

455 5 Star and Amtech

A fter sinking into bankruptcy and having to be bailed out by the U.S. government, General Motors amazingly regained its position as the world’s largest automaker in 2011. Leaders have been praised for making tough

decisions that have led to impressive financial results, bringing out new models that connect with customers, and fixing a myriad of operational and systems issues. “We went from being troubled to being at the top of the heap,” said CEO Dan Akerson. However, there is one area in which Akerson and other leaders admit significant challenges remain: changing the bureaucratic, tradition-bound culture that crippled GM in the past. Like leaders in other companies, GM executives are finding that changing culture is the toughest part of leading a turnaround. One of Akerson’s goals is to get more women into top jobs, partly because he believes they can lead the radical culture change the company needs.

He’s off to a good start. The auto industry in general is male-dominated, and there is no job more associated with machismo than the job of creating and engineering new cars. Who did Akerson pick to be head of product development? A woman—and moreover, the former head of human resources! Mary Barra, who has

427 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

held positions in various parts of the company over her 32 years with GM, is now the highest-ranking woman in the global auto industry, and she is helping remake the rule-bound, dysfunctional culture from the ground up. As head of HR, Barra cut the rules for on-the-job apparel to two words: Dress appropriately. If she can use her new position in charge of product development to enact similar broad changes that speed decision making, GM has a chance to soar.1

In the previous chapter, we talked about creating an inspiring vision and defining the strategies to help achieve it. Successful leaders recognize that culture is a core element in helping the organization meet strategic goals and attain the vision. Leaders align people with the vision by influencing organizational culture and shaping the environment that determines morale and performance.

This chapter explores the role of leaders in shaping organizational culture and values. Most leaders recognize that culture is an important mechanism for attracting, motivating, and retaining talented employees, a capability that may be the single best predictor of overall organizational excellence.2 In a survey of Canada’s top 500 companies, 82 percent of leaders said culture has a strong impact on their company’s performance.3 One long-term study discovered that organizations with strong cultures outperform those with weak cultures two to one on several primary measures of financial performance.4 In another Canadian study, the three- year average revenue growth for the top 10 companies ranked as having positive cultures was 63 percent higher than that of the 60 largest public companies in Canada.5 The first section of this chapter describes the nature of corporate culture and its importance to organizations. Then we turn to a consideration of how shared values can help the organization stay competitive and how leaders influence cultural values for high performance. The final section of the chapter briefly discusses ethical and spiritual values and how values-based leadership shapes an organization’s cultural atmosphere.

ORGANIZATIONAL CULTURE Corporate culture is powerful because it affects a company’s performance for better or worse. Thriving companies such as Google, Southwest Airlines, and Apple have often attributed their success to the cultures their leaders helped create. This chapter’s Bookshelf provides a glimpse into the culture at Google. On the other hand, dysfunc- tional cultures or the wrong cultural values have been blamed for many of the problems at companies like Bear Stearns, Research in Motion (maker of the once- ubiquitous Blackberry), and Kodak, the company whose little yellow packages of film once dominated photography. A shifting environment often calls for new values and fresh approaches to doing business. Most leaders now understand that when a company’s culture fits the needs of its external environment and company strategy, employees can create an organization that is tough to beat.6

What Is Culture? Some people think of culture as the character or personality of an organization. How an organization looks and “feels” when you enter it is a manifestation of the organizational culture. For example, if you visit headquarters at ExxonMobil, you would likely get a sense of formality the minute you walk in the door. Most employees are in conventional business attire, desks are neat and orderly, and the atmosphere is tinged with competitiveness and a rigorous, analytical approach to

428 PART 5 THE LEADER AS SOCIAL ARCHITECT

taking care of business. “They’re not in the fun business,” said one oil industry analyst. “They’re in the profit business.”7 At a company such as Zappos, though, where fun is a core value, employees may be wearing jeans and sneakers, sport pierced lips or noses, and have empty pizza boxes, coffee cups, and drink bottles on their desks. Both of these companies are highly successful, but the underlying cultures are very different.

Culture can be defined as the set of key values, assumptions, understandings, and norms that is shared by members of an organization and taught to new members as correct.8 Norms are shared standards that define what behaviors are acceptable and desirable within a group of people. At its most basic, culture is a pattern of shared assumptions and beliefs about how things are done in an organization. As organizational members cope with internal and external pro- blems, they develop shared assumptions and norms of behavior that are taught to new members as the correct way to think, feel, and act in relation to those problems.9

LEADER’S BOOKSHELF I’m Feeling Lucky: The Confessions of Google Employee Number 59

by Douglas Edwards

When Douglas Edwards took a pay cut to join a fledgling Internet startup as its first director of marketing and brand management, he had no idea he had stumbled into one of the most success- ful technology companies of all time. He also found himself stumbling through a corporate culture where the ordinary rules didn’t apply. Edwards, the 59th employee hired by search engine com- pany Google, spent seven years at the company and wrote I’m Feeling Lucky to describe what it was like to work there in the early years. The book also gives an entertaining and affectionate glimpse into a unique corporate culture.

NO CONVENTIONAL COMPANY Founders Sergey Brin and Larry Page were excessively choosy in hiring, and they wanted people who were Googley, meaning they were not too traditional or stuck in the ways of other companies. Here are some of the tidbits Edwards shares that reflect the culture Brin and Page built:

• Quality and Innovation Are Top Values. Edwards brought the “conventional wisdom” to his job at Google and in an early presentation said, “In a world where all search

engines are equal, we’ll need to rely on branding to differentiate us from our competitors.” The room became deathly quiet, and then Larry Page said, “If we can’t win on quality, we shouldn’t win at all.” The culture encouraged people to spend 20 percent of their work week devel- oping ideas not related to their primary assignments. This focus on innovation was responsible for some of the firm’s most profitable early developments, such as Gmail.

• Hierarchy Is Dead. Brin and Page maintained a flat structure and encouraged people to communicate ideas directly to the top. Getting hired wasn’t easy, but once people were on board, even the newest employees (called “nooglers”) could influence major decisions if they had good data to back up their proposals.

• Impatience Is a Virtue. Google was “a headlong rush to reshape the world in a generation,” Edwards writes. Googlers kept work hours more like a high-pressure graduate school schedule than a corporation, sometimes working through the night to solve problems. Page and Brin encouraged people to challenge

all assumptions and view every prob- lem as solvable.

• We’ll Feed You to Keep You Work- ing. Google’s well-known lavish perks—a full-service kitchen and free meals, snack rooms, workout and yoga facilities, onsite massages, complimentary car washes, and so forth—began in the early days. The founders expected extraordinary commitment, and they were willing to provide extraordinary support.

THEN THERE ARE THE FUN AND GAMES In the early days of Google, there were frequently impromptu roller hockey matches, Super Soaker water battles in the parking lot, and the legendary TGIF “staff meetings” at a local bar. When people needed to blow off steam after a heated disagreement (and there were quite a few), they could challenge each other to a video game death match. I’m Feeling Lucky describes a company where the mood could be playful or seri- ous but was always unconventional.

Source: I’m Feeling Lucky: The Confessions of Google Employee Number 59, by Douglas Edwards, is published by Houghton Mifflin Harcourt.

429

Culture the set of key values, as- sumptions, understandings, and norms that is shared by members of an organization and taught to new members as correct

Culture can be thought of as consisting of three levels, as illustrated in Exhibit 14.1, with each level becoming less obvious.10 At the surface level are visible artifacts, such as manner of dress, patterns of behavior, physical symbols, organizational ceremo- nies, and office layout—all the things one can see, hear, and observe by watching members of the organization. Consider some observable aspects of culture at John Lewis, a successful retailer in Great Britain. People working in John Lewis stores are typically older than staff members at other retailers and are called partners, not employees. Everyone shares in company profits and has a say in how the business is run. The entrance to leaders’ offices is small and functional rather than ostentatious, and stores exude an air of simplicity, calmness, and order.11 At a deeper level of culture are the expressed values and beliefs, which are not observable but can be discerned from how people explain and justify what they do. These are values that members of the organization hold at a conscious level. For example, John Lewis part- ners consciously know that dependability, service, and quality are highly valued and rewarded in the company culture.

Some values become so deeply embedded in a culture that organizational mem- bers may not be consciously aware of them. These basic, underlying assumptions are the essence of the culture. At John Lewis, these assumptions might include (1) that the company cares about its employees as much as it expects them to care about customers, (2) that individual employees should think for themselves and do what they believe is right to provide exceptional customer service, and (3) that trust and honesty are an essential part of successful business relationships. Assumptions generally start out as expressed values, but over time they become more deeply embedded and less open to question—organization members take them for granted and often are not even aware of the assumptions that guide their behavior, language, and patterns of social interaction.

EXHIBIT 14.1 Levels of Corporate Culture

430 PART 5 THE LEADER AS SOCIAL ARCHITECT

Importance of Culture When people are successful at what they undertake, the ideas and values that led to that success become institutionalized as part of the organization’s culture.12 Culture gives employees a sense of organizational identity and generates a commitment to particular values and ways of doing things. Culture serves two important functions in organizations: (1) it integrates members so that they know how to relate to one another, and (2) it helps the organization adapt to the external environment.

Internal Integration Culture helps employees develop a collective identity and know how to work together effectively. It is culture that guides day-to-day working relationships and determines how people communicate in the organization, what behavior is acceptable or not acceptable, and how power and status are allocated. Culture can imprint a set of unwritten rules inside employees’ minds, which can be very powerful in determining behavior, thus affecting organizational performance.13

Consider how the culture at Billtrust, a small New Jersey–based automated and elec- tronic billing services firm, fosters internal integration.

IN THE LEAD Flint Lane, Billtrust Over a two-year period, Billtrust grew from 45 to 145 employees, and increasing business meant more new people would be coming on board. That was good news, but founder Flint Lane wanted to be sure the culture that promoted fun, open communication, team- work, and interdepartmental interaction remained strong.

Billtrust has always had an open door policy to encourage people to take ownership of their jobs and talk to leaders about whatever is on their minds. As the company grew, leaders decided to add a monthly town-hall-style meeting for all employees. It begins at 11:37 A.M., an offbeat time, chosen so that people can demonstrate their commitment to the company by making timeliness a priority. At these meetings, Lane and other leaders encourage people to ask candid questions, and they respond openly and honestly. The company also hosts a number of companywide events, including an annual team table tennis tournament, two yearly bowling tournaments, and regular summer cookouts where departments take turns supplying a “grill master” whose skills are evaluated by colleagues.

These fun, and sometimes wacky, events serve to bond the growing workforce into a united whole and reinforce the cultural values. As one new employee put it, “Everyone else offered me a job, but Billtrust offered me something I could become a part of.”14

Many organizations, like Billtrust, want strong cultures that encourage team- work, collaboration, and mutual trust.15 In an environment of trust, people are more likely to share ideas, be creative, and be generous with their knowledge and talents.

External Adaptation Culture also determines how the organization meets goals and deals with outsiders. The right cultural values can help the organization respond rapidly to customer needs or the moves of a competitor. Culture can encourage employee commitment to the core purpose of the organization, its specific goals, and the basic means used to accomplish goals.

NEW LEADER ACTION MEMO As a leader, you can pay at- tention to organizational cul- ture and develop an awareness of how cultural values, norms, and beliefs influence people’s behavior in the organization.

CHAPTER 14 SHAPING CULTURE AND VALUES 431

The “right” culture is determined partly by what the organization needs to meet external challenges. The culture should embody the values and assumptions needed by the organization to succeed in its environment.16 If the competitive environment requires speed and flexibility, for example, the culture should embody values that sup- port adaptability, collaboration across departments, and a fast response to customer needs or environmental changes. When Lou Gerstner took over as CEO of IBM in 1993, it was on the brink of collapse partly because of an “inbred and ingrown” culture that slowed decision making and prevented adaptation to the rapidly changing environment. One step Gerstner took early on was to change the way meetings were handled. To put more value on dialogue and shared decision making rather than presentations, he limited the number of slides that could accompany a report to five.17 By the time Gerstner had left nearly 10 years later, IBM had a new culture in which everyone knew they were rewarded for collaborating and getting things done fast, not for hoarding information and making impressive presentations.18

All effective cultures encourage adaptation to the environment in order to keep the organization healthy and profitable. This chapter’s Consider This highlights the importance of individual learning and adaptability. Just like people, organizational cultures have to grow and change to meet new challenges.

Consider Here Is Your Assignment

1. You will receive a body. You may like it or not, but it will be yours for the entire period this time around.

2. You will learn lessons. You are enrolled in a full-time, informal school called life. Each day in this school you will have the opportunity to learn lessons. You may like the lessons or think them irrelevant and stupid.

3. There are no mistakes, only lessons. Growth is a process of trial and error, experimentation. The “failed” experiments are as much a part of the process as the experiment that ultimately “works.”

4. A lesson is repeated until it is learned. A lesson will be presented to you in various forms until you have learned it; then you can go on to the next lesson.

5. Learning lessons does not end. There is no part of life that does not contain its lessons. If you are alive, there are lessons to be learned.

6. “There” is no better than “here.” When your “there” has become a “here,” you will simply obtain another “there” that will, again, look better than “here.”

7. Others are merely mirrors of you. You cannot love or hate something about another person unless it reflects to you something you love or hate about yourself.

8. What you make of your life is up to you. You have all the tools and resources you need; what you do with them is up to you. The choice is yours.

9. The answers lie inside you. The answers to life’s questions lie inside you. All you need to do is look, listen, and trust.

10. Whether you think you can or can’t, in either case you’ll be right. Think about it.

432 PART 5 THE LEADER AS SOCIAL ARCHITECT

CULTURE STRENGTH, RESPONSIVENESS, AND PERFORMANCE Culture strength refers to the degree of agreement among employees about the importance of specific values and ways of doing things. If widespread consensus exists, the culture is strong and cohesive; if little agreement exists, the culture is weak.19 The effect of a strong culture is not always a positive one. Sometimes a strong culture can encourage the wrong values and cause harm to the organization and its members. Think of the now-defunct Bear Stearns, which had a strong, highly competitive corporate culture that supported pushing everything to the limits in the pursuit of wealth. As long as an employee was making money for the firm, leaders took a hands-off approach, which allowed increasingly risky and sometimes unethical behavior.20

A strong culture increases employee cohesion and commitment to the values, goals, and strategies of the organization, but companies can sometimes have uneth- ical values or values that are unhealthy for the organization because they don’t fit the needs of the environment. Research at Harvard into some 200 corporate cul- tures found that a strong culture does not ensure success unless it also encourages a healthy response and adaptation to the external environment.21 A strong culture that does not encourage adaptation can be more damaging to an organization than a weak culture.

Responsive Cultures Cultures can be thought of as either responsive or resistant. As illustrated in Exhibit 14.2, responsive corporate cultures have different values and behavior from resistant cultures.22 In responsive cultures, leaders are concerned with customers and with people, processes, and procedures within the organization that bring about useful change. In resistant cultures, leaders are concerned with them- selves or their own special projects, and their values tend to discourage risk taking and change. Thus, a strong culture is not enough because an unhealthy culture may encourage the organization to march resolutely in the wrong direction. Healthy cultures help companies respond to changes in the external environment.

EXHIBIT 14.2 Responsive versus Resistant Cultures

Visible behavior Leaders pay attention to all stakeholders and initiate change when needed to serve the legitimate interests of custo- mers, employees, partners, or others, even if it entails taking some risks.

Managers tend to be inward-looking and politically motivated. As a result, they do not change their goals and strategies quickly to adjust to changes in the environment.

Expressed values

Leaders genuinely care about customers, employees, partners, and shareholders. They value all the people, processes, and mechanisms up and down the hierarchy that can create useful change.

Managers care mainly about their own interests and the products or technologies of their immediate team or department. They value the orderly and risk-reducing management system more highly than change initiatives.

Underlying assumption

Serve whole organization, trust others. Meet own needs, distrust others.

Source: Based on John P. Kotter and James L. Heskett, Corporate Culture and Performance (New York: The Free Press, 1992), p. 51.

Culture strength the degree of agreement among employees about the importance of specific values and ways of doing things

NEW LEADER ACTION MEMO As a leader, you can build a responsive culture by showing concern for customers and other stakeholders and by supporting people and projects that bring about useful change. To improve your understanding of responsive versus resistant cultures, go to Leader’s Self-Insight 14.1.

CHAPTER 14 SHAPING CULTURE AND VALUES 433

An organization’s culture may not always be in alignment with the needs of the external environment. The values and ways of doing things may reflect what worked in the past. The difference between desired and actual values and behaviors is called the culture gap.23 Many organizations have some degree of culture gap, though leaders often fail to realize it. An important step toward shifting the culture toward more adaptive values is to recognize when people are adhering to the wrong values or when important values are not held strongly enough.24

Culture gaps can be immense, particularly in the case of mergers. Leaders at Alpha Natural Resources Inc. are struggling to merge two distinct cultures after acquiring Massey Energy Company. Massey was in control of the mine in West Virginia at which an explosion killed 29 workers in 2010. Alpha CEO Kevin Crutch- field makes safety a core value, and he scheduled 400 training sessions to train every

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 14.1

Working in a Responsive Culture

Instructions: Think of a specific full-time job you have held. Indicate whether each of the following items is Mostly False or Mostly True according to your perception of the managers above you when you held that job.

Mostly False

Mostly True

1. Good ideas got serious consid- eration from management above me

2. Management above me was in- terested in ideas and suggestions from people at my level in the organization.

3. When suggestions were made to management above me, they received fair evaluation.

4. Management did not expect me to challenge or change the status quo.

5. Management specifically en- couraged me to bring about improvements in my workplace.

6. Management above me took action on recommendations made from people at my level.

7. Management rewarded me for correcting problems.

8. Management clearly expected me to improve work unit procedures and practices.

9. I felt free to make recommenda- tions to management above me to change existing practices.

10. Good ideas did not get commu- nicated upward because man- agement above me was not very approachable.

Scoring and Interpretation To compute your score: Give yourself one point for each Mostly True answer to questions 1, 2, 3, 5, 6, 7, 8, and 9 and for each Mostly False answer to questions 4 and 10. Total points: .

A responsive culture is shaped by the values and actions of top and middle executives. When managers actively encour- age and welcome change initiatives from below, the organiza- tion will be infused with values for responsiveness and change. These 10 questions measure your management’s openness to change. A typical average score for management openness to change is about 4. If your average score was 5 or higher, you worked in an organization that expressed cultural values of responsiveness. If your average score was 3 or below, the cul- ture was probably a resistant one.

Thinking back to your job, was the level of management openness to change correct for that organization? Why? Compare your score to that of another student, and take turns describing what it was like working for the managers above you. Do you sense that there is a relationship between job satisfaction and management’s openness to change? What specific manager characteristics and corporate values accounted for the openness (or lack of) in the two jobs?

Sources: Based on S. J. Ashford, N. P. Rothbard, S. K. Piderit, and J. E. Dutton, “Out on a Limb: The Role of Context and Impression Management in Issue Selling,” Administrative Science Quarterly 43 (1998), pp. 23–57; and E. W. Morrison and C. C. Phelps, “Taking Charge at Work: Extrarole Efforts to Initiate Workplace Change,” Academy of Management Journal 42 (1999), pp. 403–419.

| D re am

st im e. co m

434

Culture gap the difference between desired and actual values and behaviors

Massey employee in the management system called Running Right. “There is no ton of coal worth an injury, an accident, or, God forbid, a life,” he says. “It’s just a ton of coal. So, if we can’t get it out the right way, we’re not going to bother. I think that is a little different from what the Massey folks were used to.”25

Despite the popularity of mergers and acquisitions as a corporate strategy, many fail. Studies by consulting firms such as McKinsey & Company, the Hay Group, and others suggest that performance declines in almost 20 percent of acquired companies after acquisition. Some experts claim that 90 percent of mer- gers never live up to expectations.26 One reason for this is the difficulty of integrat- ing cultures. Organizational leaders should remember that the human systems—in particular, the norms and values of corporate culture—are what make or break any change initiative. The problem of integrating cultures increases in scope and complexity with global companies and cross-cultural mergers or acquisitions.

The High-Performance Culture Creating and sustaining a responsive, high-performance culture in one of the most important jobs for organizational leaders.27 A number of studies have found a positive relationship between culture and performance.28 In Corporate Culture and Performance, Kotter and Heskett provided evidence that companies in which leaders intentionally managed cultural values outperformed similar companies whose leaders did not.29 Even the U.S. government is recognizing the link between culture and effectiveness. The U.S. Office of Personnel Management created its Organizational Assessment Survey as a way for federal agencies to measure aspects of culture and shift values toward high performance.30

Companies that succeed have leaders who pay careful attention to both cultural values and business performance. Exhibit 14.3 illustrates four organizational out- comes based on the relative attention leaders pay to cultural values and business performance.31 For example, leaders in Quadrant C of Exhibit 14.3 pay little atten- tion to either cultural values or business results, and the company is unlikely to sur- vive for long. Leaders in Quadrant D are highly focused on creating a strong culture, but they don’t tie the values directly to goals and desired results.

When leaders don’t connect cultural values to business performance, the values aren’t likely to benefit the organization during hard times. For example, the corpo- rate culture at The LEGO Group headquarters in Billund, Denmark, nearly doomed the toymaker when sales plummeted as children turned away from traditional toys to video games. At that time, LEGO leaders reflected the characteristics found in Quadrant D of Exhibit 14.3. Imagination and creativity, not business performance, were what guided Lego. The attitude was, “We’re doing great stuff for kids—don’t bother us with financial goals.” A new CEO, Jørgen Vig Knudstorp, transformed the culture with a new employee motto: “I am here to make money for the company.” Shifting leader attitudes to incorporate bottom-line results as well as values had a profound effect, and Lego has become one of the most successful com- panies in the toy industry.32

Quadrant A in Exhibit 14.3 represents organizations in which leaders focus primarily on bottom-line results and pay little attention to values. This approach may be profitable in the short run, but the success is difficult to sustain over the long term because the “glue” that holds the organization together—that is, shared cultural values—is missing. Consider how a bottom-line focus at four-year-old Zynga, the Web’s largest social games company, is damaging the organization. Zynga, led by CEO Mark Pincus, recorded a phenomenal $828 million in revenue

CHAPTER 14 SHAPING CULTURE AND VALUES 435

in the first nine months of 2011, more than double the period a year earlier. Zynga also met ambitious profitability goals, rare among Internet start-ups. With this type of financial performance, one might assume working for Zynga would be enjoyable and gratifying. However, teams for each game, like FarmVille and CityVille, work under aggressive deadlines and are continuously challenged to meet lofty perfor- mance goals. Leaders emphasize performance reports, relentlessly aggregating data, and using the data to demote or fire weak employees. Little attention is paid to cultural values that bind people into a unified whole. The relentless focus on financial performance began to take a toll when people started voicing their frustration, com- plaining about long hours and aggressive deadlines. “Mark Pincus has the reputation that he is driven to the point of a madman,” said one industry analyst. Former employees describe emotionally charged encounters, including loud outbursts from Pincus, threats from senior leaders, and moments when colleagues broke down into tears. The company’s success cannot easily be sustained without an increased focus on building a more positive culture. Already, valued employees are being lured away by competitors in an industry where talent is scarce.33

Companies that maintain success over the long term have leaders who fit into Quadrant B. They put high emphasis on both culture and solid business perfor- mance as drivers of organizational success. Quadrant B organizations represent the high-performance culture, a culture that (1) is based on a solid organizational mis- sion or purpose, (2) embodies shared responsive values that guide decisions and business practices, and (3) encourages individual employee ownership of both bottom-line results and the organization’s cultural backbone.34

EXHIBIT 14.3 Combining Culture and Performance

Sources: Adapted from Jeff Rosenthal and Mary Ann Masarech, “High-Performance Cultures: How Values Can Drive Business Results,” Journal of Organizational Exellence (Spring 2003), pp. 3–18; and Dave Ulrich, Steve Kerr, and Ron Ashkenas, Figure 11-2, GE Leadership Decision Matrix, The GE Work-Out: How to Implement GE’s Revolutionary Method for Busing Bureaucracy and Attaching Organizational Problems—Fast! (New York: McGraw-Hill, 2002), p. 230.

436 PART 5 THE LEADER AS SOCIAL ARCHITECT

High-performance culture a culture that is based on a solid mission, embodies shared responsive values that guide decisions, and encourages individual own- ership of both bottom-line results and cultural values

In Quadrant B companies, leaders align values with the company’s day-to-day operations—hiring practices, performance management, budgeting, criteria for pro- motions and rewards, and so forth. For example, when he was CEO of General Electric, Jack Welch helped GE become one of the world’s most successful and admired companies. He achieved this by evaluating and rewarding leaders through- out the company based on whether they honored important cultural values in addi- tion to “making their numbers.”35 Another example of an organization where leaders tie values to business performance is Menlo Innovations.

IN THE LEAD Menlo Innovations Richard Sheridan, James Goebel, Robert Simms, and Thomas Meloche founded Menlo Inno- vations to create custom software for organizations, but one of their primary goals was to create a unique culture that embraces the values of equality, teamwork, learning, and fun. The founders say they were inspired by the collaborative and creative work environment demonstrated at Thomas Edison’s Menlo Park, New Jersey, “Invention Factory” more than 120 years ago.

At many software companies developers work alone and are driven to meet rigorous performance goals, but at Menlo, collaboration is valued above anything else. Everyone works in a large, open room with no barriers of any kind to limit communication and information sharing. Employees work in pairs, sharing a single computer and passing the mouse back and forth as they brainstorm ideas and troubleshoot problems. The pairs stay together for a week and then all switch around to new partners. The variety of partners and tasks helps keep energy high as well as brings fresh perspectives to ever-evolving projects.

Curiosity, willingness to learn, and the ability to “play well with others” are the qual- ities Menlo wants in its employees. The goal for each person is not to get the right answer, make the right connection, be the smartest, or know the most, but rather to bring out the best in one’s partner. Consider Menlo leaders’ approach to hiring. People who apply for jobs are divided into pairs and assigned an exercise, then evaluated on how effective they are at making the other applicant look good. It’s tough for some people to handle—trying to make sure a competitor looks good enough to get the job you want. However, at Menlo, if you can’t do that, you won’t fit the culture—and fitting the culture is essential. Anyone who says, “I’m right, so let’s do it this way” won’t last long. “Constant collaboration means we are constantly transferring knowledge to one another,” says Sheridan. “I grow my team an inch every day.” Menlo’s culture has been a competitive advantage for the company, enabling it to adapt quickly to an ever- shifting environment and meet the changing technology needs of varied clients, includ- ing Domino’s Pizza, Thomson Reuters, Pfizer, Nationwide Financial, and the University of Michigan.36

At companies with high-performance cultures, such as GE and Menlo Innova- tions, leaders care about both values and performance. A study of corporate values by Booz Allen Hamilton and the Aspen Institute found that leaders in companies that report superior financial results typically put a high emphasis on values and link them directly to the way they run the organization.37

CHAPTER 14 SHAPING CULTURE AND VALUES 437

CULTURAL LEADERSHIP An organization exists only because of the people who are a part of it, and those people both shape and interpret the character and culture of the organization. That is, an organization is not a slice of objective reality; different people may per- ceive the organization in different ways and relate to it in different ways. Leaders in particular formulate a viewpoint about the organization and the values that can help people achieve the organization’s mission, vision, and strategic goals. Therefore, leaders enact a viewpoint and a set of values that they think are best for helping the organization succeed. A primary way in which leaders influence norms and values to build a high-performance culture is through cultural leadership.

A cultural leader defines and uses signals and symbols to influence corporate culture. Cultural leaders influence culture in two key areas:

1. The cultural leader articulates a vision for the organizational culture that employees can believe in. This means the leader defines and communicates cen- tral values that employees believe in and will rally around. Values are tied to a clear and compelling mission, or core purpose.

2. The cultural leader heeds the day-to-day activities that reinforce the cultural vision. The leader makes sure that work procedures and reward systems match and reinforce the values. Actions speak louder than words, so cultural leaders “walk their talk.”38

For values to guide the organization, leaders model them every day. WestJet Airlines, which is consistently ranked as having one of Canada’s most admired corporate cultures, provides an illustration. Employees (called simply “people” at WestJet) regularly see top leaders putting the values of equality, teamwork, participa- tion, and customer service into action. At the end of a flight, for example, everyone on hand pitches in to pick up garbage–sometimes even the CEO. Customer-facing employees have “guidelines” rather than rules in terms of what they can do for customers, and no one is ever punished for well-intended errors of judgment. A new gate agent who gave free tickets to an entire flight for a minor inconvenience, for instance, was hailed as a hero for her effort, even though leaders coached her through understanding the impact of her action on the company so she might make a less costly decision the next time.39

Creating and maintaining a high-performance culture is not easy in today’s turbulent environment and changing workplace, but through their words—and particularly their actions—cultural leaders let everyone in the organization know what really counts. Some of the mechanisms leaders use to enact cultural values are organizational rites and ceremonies, stories, symbols, and specialized language. In addition, they emphasize careful selection and socialization of new employees to keep cultures strong. Perhaps most importantly, leaders signal the cultural values they want to instill in the organization through their day-to-day behavior.

Ceremonies A ceremony is a planned activity that makes up a special event and is generally conducted for the benefit of an audience. Leaders can schedule ceremonies to provide dramatic examples of what the company values. Ceremonies reinforce specific values, create a bond among employees by allowing them to share an important event, and anoint and celebrate employees who symbolize important achievements.40

438 PART 5 THE LEADER AS SOCIAL ARCHITECT

Cultural leader a leader who actively uses signals and symbols to in- fluence corporate culture

Ceremony a planned activity that makes up a special event and is generally conducted for the benefit of an audience

A ceremony often includes the presentation of an award. At Mary Kay Cosmetics, one of the most effective companies in the world at using ceremonies, leaders hold elaborate award ceremonies at an annual event called “Seminar,” presenting jewelry, furs, and luxury cars to high-achieving sales consultants. The most successful consultants are introduced by film clips like the ones used to present award nominees in the entertainment industry.41 These ceremonies recog- nize and celebrate high-performing employees and help bind sales consultants together. Even when they know they will not personally be receiving awards, consultants look forward to Seminar all year because of the emotional bond it creates with others.

Stories A story is a narrative based on true events that is repeated frequently and shared among employees. Leaders can use stories to illustrate the company’s primary values.42 Employees at IBM often hear a story about the female security guard who challenged IBM’s chairman. Although she knew who he was, the guard insisted that the chairman could not enter a particular area because he wasn’t car- rying the appropriate security clearance. Rather than getting reprimanded or fired, the guard was praised for her diligence and commitment to maintaining the security of IBM’s buildings.43 By telling this story, employees emphasize both the impor- tance of following the rules and the critical contributions of every employee from the bottom to the top of the organization. Russell Goldsmith, chairman and CEO of City National Bank in Los Angeles, believes in the force of storytelling so much that he brought in consultants to teach people how to share their stories about teamwork or customer service, which reinforces the company culture.44

In some cases, stories may not be supported by facts, but they are consistent with the values and beliefs of the organization. A widely told story at Nordstrom, for example, is about the associate who, in order to satisfy a customer who was unhappy with the performance of his automobile tires, gave the customer his money back. The only thing is, Nordstrom does not sell tires. The story reinforces the company’s no-questions-asked return policy.45

Symbols Another tool for conveying cultural values is the symbol. A symbol is an object, act, or event that conveys meaning to others. For example, top leaders at Germany’s TeamBank, described in the previous chapter, made the informal Du the mandatory form of address rather than the formal Sie commonly used in German workplaces. The change is a symbol of top management’s respect for every employee. At tomato processor Morning Star, described at the beginning of Chapter 10, administrative offices are located near the factory floor to symbolize that everyone is on the same team with the same purpose.46

Leaders can also use physical artifacts to symbolize important values. After the national hotel chain Extended Stay America emerged from bankruptcy, employees remained fearful of losing their jobs if they made any decision that might cost the company money. To implement a new culture where people aren’t afraid to take risks to serve customers, new CEO Jim Donald began hand- ing out lime-green “Get Out of Jail, Free” cards. All people had to do, he told them, was call in the card when they took a big risk on behalf of the company— no questions asked.47

CHAPTER 14 SHAPING CULTURE AND VALUES 439

Story a narrative based on true events that is repeated fre- quently and shared among employees

Symbol an object, act, or event that conveys meaning to others

Specialized Language Language can shape and influence organizational values and beliefs. Leaders some- times use slogans or sayings to express key corporate values. Slogans can easily be picked up and repeated by employees. For example, at Averitt Express, the slogan “Our driving force is people” applies to customers and employees alike. The culture emphasizes that drivers and customers, not top executives, are the power that fuels the company’s success.

Leaders also express and reinforce cultural values through written public state- ments, such as corporate mission statements or other formal statements that express the core values of the organization. When Sidney Taurel, who became chairman and CEO of Eli Lilly and Company in 1999, wanted to create a more adaptive culture able to respond to the demands of the global marketplace, he worked with other lea- ders to develop a formal statement of how to put Lilly’s core values (respect for all people, honesty and integrity, and striving for excellence) into action. The statement includes descriptions and mottos such as “Model the values: Show us what you’re made of,” “Implement with integrity, energy, and speed: Provide the powder and supply the spark,” and “Get results through people: Set people up to succeed.”48

Selection and Socialization To maintain cultural values over time, leaders emphasize careful selection and socialization of new employees. Companies with strong, healthy cultures, such as Nordstrom, Southwest Airlines, Google, and Zappos, often have rigorous hiring practices.

Once the right people are hired, the next step is socializing them into the cul- ture. Socialization is the process by which a person learns the values, norms, per- spectives, and expected behaviors that enable him or her to successfully participate in the group or organization.49 When people are effectively socialized, they “fit in” because they understand and adopt the norms and values of the group. Socializa- tion is a key leadership tool for transmitting the culture and enabling it to survive over time. Leaders act as role models for the values they want new employees to adopt, as well as implement formal training programs, which may include pairing the newcomer with a key employee who embodies the desired values.

Rituals can also be used for socialization. At Gentle Giant, a Somerville, Massachusetts, moving company that has won nine Best of Boston awards from Boston magazine, new hires participate in the “stadium run.” CEO Larry O’Toole decided to have new hires run the tiers of Harvard University stadium as a way to emphasize that people at the company work hard, challenge themselves, and go the distance rather than letting up if things get tough. After the run, O’Toole provides a hearty breakfast and gives an orientation speech. “You’re not a Gentle Giant until you’ve done the run,” said employee Kyle Green.50 Good leaders don’t leave employee socialization to chance. Formal socialization programs can be highly effective. One study of recruits into the British Army surveyed newcomers on their first day and then again eight weeks later. Researchers compared the findings to a sample of experienced “insider” soldiers and found that after eight weeks of train- ing, the new recruits’ norms and values had generally shifted toward those of the insiders.51 Another field study of around 300 people from a variety of organiza- tions found that formal socialization was associated with less stress for newcomers, less ambiguity about expected roles and behaviors, and greater job satisfaction, commitment, and identification with the organization.52

NEW LEADER ACTION MEMO As a leader, you can shape cultural values through rites and ceremonies, stories, sym- bols, and language. You can keep the culture strong by carefully selecting and socializ- ing people and by making sure your actions match the espoused values.

440 PART 5 THE LEADER AS SOCIAL ARCHITECT

Socialization the process by which a person learns the cultural values, norms, and behaviors that enable him to “fit in” with a group or organization

Daily Actions One of the most important ways leaders build and maintain the cultures they want is by signaling and supporting important cultural values through their daily actions. Employees learn what is valued most in a company by watching what attitudes and behaviors leaders pay attention to and reward, how leaders react to organizational crises, and whether the leader’s own behavior matches the espoused values.53 Former AmerisourceBergen CEO Dave Yost supported values of frugality and egalitarianism by answering his own phone, flying coach, and doing without fancy perks and stylish office furniture.54 Leaders can also change negative or unproductive cultures by their actions. At Dynergy, a Houston-based power producer, new CEO Bob Flexon’s office is a 64-square-foot cubicle identical to those of the 235 or so headquarters employees surrounding him. People often stop by just to chat. Flexon is instilling values of openness, egalitarianism, and collaboration to try to get Dynergy back in growth mode after the company went through bankruptcy.55

Good leaders understand how carefully they are watched by employees. As for- mer GE CEO Jack Welch says, “Look, it’s Management 101 to say that the best competitive weapon a company can possess is a strong culture. But the devil is in the details of execution.” Welch says one sure route to destroying the culture is to let strong performers get away with not honoring the cultural values. People notice, and they conclude that the cultural values aren’t important. Leaders make sure peo- ple are evaluated for both making their numbers and demonstrating the values, as described earlier in Exhibit 14.3, and they don’t hesitate to fire people who refuse to uphold important values.56

A new CEO at Barclays PLC, which became embroiled in a scandal when it was found that some managers tried to rig interest rates to increase profits, is try- ing to put this into action. CEO Anthony Jenkins has told employees to uphold the values of respect, integrity, service, excellence, and stewardship, or get ready to be fired. “We must never again be in a position of rewarding people for mak- ing the bank money in a way which is unethical or inconsistent with our values,” he said.57

THE COMPETING VALUES APPROACH TO SHAPING CULTURE Organizational values are the enduring beliefs that have worth, merit, and impor- tance for the organization. The economic crisis, the breakdown of corporate ethics and responsibility that contributed to it, and the crash of once-thriving companies have brought values to the forefront. Unhealthy cultural values played a crucial role in many of the mistakes these companies made.58 Ethical values will be dis- cussed later in the chapter. Changes in the nature of work, globalization, increas- ing diversity in the workforce, and other shifts in the larger society have also made the topic of values one of considerable concern to leaders. They are faced with such questions as, “How can I determine what cultural values are important? Are some values ‘better’ than others? How can the organization’s culture help us be more competitive?”

In considering what values are important for the organization, leaders consider the external environment and the company’s vision and strategy. Cultures can vary widely across organizations; however, organizations within the same industry

CHAPTER 14 SHAPING CULTURE AND VALUES 441

Organizational values the enduring beliefs that have worth, merit, and importance for the organization

often share similar values because they are operating in similar environments.59 Key values should embody what the organization needs to be effective. Rather than looking at values as either “good” or “bad,” leaders look for the right combina- tion. The correct relationship among cultural values, organizational strategy, and the external environment can enhance organizational performance.

Organizational cultures can be assessed along many dimensions, such as the extent of collaboration versus isolation among people and departments, the impor- tance of control and where control is concentrated, or whether the organization’s time orientation is short-range or long-range.60 Here, we will focus on two specific dimensions: (1) the extent to which the competitive environment requires flexibility or stability, and (2) the extent to which the organization’s strategic focus and strength is internal or external. Four categories of culture associated with these dif- ferences, as illustrated in Exhibit 14.4, are adaptability, achievement, involvement, and consistency.61 These four categories relate to the fit among cultural values, strategy, structure, and the environment, with each emphasizing specific values, as shown in the exhibit.

An organization may have cultural values that fall into more than one category, or even into all categories. However, successful organizations with strong cultures will lean more toward one particular culture category.

EXHIBIT 14.4 Four Corporate Cultures

Sources: Based on Paul McDonald and Jeffrey Gandz, “Getting Value from Shared Values,” Organizational Dynamics 21, no. 3 (Winter 1992), pp. 64–76; Deanne N. Den Hartog, Jaap J. VanMuijen, and Paul L. Koopman, “Linking Transformational Leadership and Organizational Culture,” The Journal of Leadership Studies 3, no. 4 (1996), pp. 68–83; Daniel R. Denison and Aneil K. Mishra, “Toward a Theory of Organizational Culture and Effectiveness,” Organizational Studies 6, no. 2 (March–April 1995), pp. 204–223; Robert Hooijberg and Frank Petrock, “On Cultural Change: Using the Competing Values Framework to Help Leaders Execute a Transformational Strategy,” Human Resource Management 32, no. 1 (1993), pp. 29–50; and R. E. Quinn, Beyond Rational Management: Mastering the Paradoxes and Competing Demands of High Performance (San Francisco: Jossey-Bass, 1998).

NEW LEADER ACTION MEMO Determine your own cultural preferences by completing the exercise in Leader’s Self-Insight 14.2.

442 PART 5 THE LEADER AS SOCIAL ARCHITECT

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 14.2

Culture Preference Inventory

I II III IV

1. Aggressiveness Cost efficiency Experimentation Fairness 2. Perfection Obedience Risk taking Agreement 3. Pursue goals Solve problems Be flexible Develop people’s careers 4. Apply careful

analysis Rely on proven approaches

Look for creative approaches

Build consensus

5. Initiative Rationality Responsiveness Collaboration 6. Highly capable Productive and

accurate Receptive to brainstorming

Committed to the team

7. Be the best in our field

Have secure jobs Recognition for innovations

Equal status

8. Decide and act quickly

Follow plans and priorities

Refuse to be pressured Provide guidance and support

9. Realistic Systematic Broad and flexible Sensitive to the needs of others

10. Energetic and ambitious

Polite and formal Open-minded Agreeable and self- confident

11. Use key facts Use accurate and complete data

Use broad coverage of many options

Use limited data and personal opinion

12. Competitive Disciplined Imaginative Supportive 13. Challenging

assignments Influence over others Achieving creativity Acceptance by the

group 14. Best solution Good working

environment New approaches or ideas

Personal fulfillment

Scoring and Interpretation Add the points in each of the four columns—I, II, III, IV. The sum of the point columns should be 210 points. If your sum does not equal 210 points, check your answers and your addition.

The scores represent your preference for I, achievement culture; II, consistency culture; III, adaptability culture; and IV, involvement culture. Your personal values are consistent with the culture for which you achieved the highest score, although all four sets of values exist within you just as they

exist within an organization. The specific values you exert as a leader may depend on the group situation, particularly the needs of the external environment. Compare your scores with other students and discuss their meaning. Are you pleased with your preferences? Do you think your scores accurately describe your values?

Source: Adapted from Alan J. Rowe and Richard O. Mason, Managing with Style: A Guide to Understanding, Assessing, and Improving Decision Making (San Francisco: Jossey-Bass, 1987).

Instructions: The following inventory consists of 14 sets of four responses that relate to typical values or situations fac- ing leaders in organizations. Although each response to a question may appear equally desirable or undesirable, your assignment is to rank the four responses in each row accord- ing to your preference. Think of yourself as being in charge of a major department or division in an organization. Rank the responses in each row according to how much you would like each one to be a part of your department.

There are no correct or incorrect answers; the scores simply reflect your preferences for different responses.

Rank each of the four in each row using the following scale. You must use all four numbers for each set of four responses. 1. Would not prefer at all 2. Would prefer on occasion 4. Would prefer often 8. Would prefer most of all

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Adaptability Culture The adaptability culture is characterized by strategic leaders encouraging values that support the organization’s ability to interpret and translate signals from the environment into new behavior responses. Employees have autonomy to make decisions and act freely to meet new needs, and responsiveness to customers is highly valued. Leaders also actively create change by encouraging and rewarding crea- tivity, experimentation, and risk taking. Aaron Levie, who cofounded Box, a Los Altos, California–based company that provides online file storage for businesses, when he was 20 years old, provides a good example of creating an adaptability culture.

IN THE LEAD Aaron Levie, Box “My main goals are to innovate and to disrupt,” says Aaron Levie, the young CEO of Box. “Also, I want to avoid being disrupted.” Those goals are reflected in the company’s culture, which emphasizes speed, flexibility, and pushing the boundaries. Levie is constantly remind- ing people that they can do things “10 times bigger, 10 times better, and 10 times faster,” a core value he calls “10X.” Other core values are “Get s—done” and “Take risks. Fail fast.”

Taking risks is essential for the company to remain competitive, but failing fast means people can correct mistakes quickly. For a company of 600 people competing with compa- nies that have tens of thousands, speed is crucial. The culture is focused on how much peo- ple can get done in as little time as possible. Goals are set very high, and the culture values solving any problem that comes along as a team. No one at Box has a private office, includ- ing Levie, who serves as CEO. The open office plan lets people interact and collaborate con- tinually. The 44 rooms that could be offices serve as conference rooms instead, where people brainstorm and hash out ideas. The glass walls are meant to be written on. People are encouraged to “throw their ideas on the wall.” Many of the conference rooms are named after Internet icons. To keep the culture strong as the company grows, Levie empha- sizes careful hiring. He talks with the company’s 15 recruiters two or three times a day and personally interviews many job candidates.

The fast pace and aggressive goals can mean high pressure, but Box also encourages fun. “We have one of the world’s best jugglers and one of the country’s best baton twirlers,” Levie says. “Circus skills are a pretty important quality around here.”62

The fun, fast, risk-taking culture at Box has helped the company adapt in a tur- bulent industry and grow quickly, more than doubling its sales every year since it was founded in 2005. Many technology and Internet-based companies, like Box, use the adaptability type of culture, as do many companies in the marketing, elec- tronics, and cosmetics industries, because they must move quickly to satisfy customers.

Achievement Culture The achievement culture is characterized by a clear vision of the organization’s goals, and leaders focus on the achievement of specific targets such as sales growth, profitability, or market share. An organization concerned with serving specific cus- tomers in the external environment but without the need for flexibility and rapid change is suited to the achievement culture. This is a results-oriented culture that

444 PART 5 THE LEADER AS SOCIAL ARCHITECT

Adaptability culture culture characterized by values that support the organization’s ability to in- terpret and translate signals from the environment into new behavior responses

Achievement culture culture characterized by a clear vision of the organiza- tion’s goals and leaders’ fo- cus on the achievement of specific targets

values competitiveness, aggressiveness, personal initiative, and the willingness to work long and hard to achieve results. An emphasis on winning is the glue that holds the organization together.63

Anheuser-Busch InBev reflects an achievement culture. Professionalism, ambi- tion, competitiveness, and aggressiveness are key values. Managers keep employees focused on achieving high sales and profit levels, and those who meet the demand- ing goals are handsomely rewarded. Bonuses and promotions are based on perfor- mance, not seniority, and top executives are unapologetic about giving special treatment to high achievers. Distribution center managers frequently start the day with a sort of pep rally reviewing the day’s sales targets and motivating people to get out and sell more beer.64

Involvement Culture The involvement culture has an internal focus on the involvement and participation of employees to meet changing expectations from the external environment. More than any other, this culture places value on meeting the needs of organization mem- bers. Companies with involvement cultures are generally friendly places to work, and employees may seem almost like a family. Leaders emphasize cooperation, consideration of both employees and customers, and avoiding status differences. Leaders put a premium on fairness and reaching agreement with others.

Consider the approach to culture taken by William Rogers, CEO of UKRD, which owns a number of commercial radio stations in the United Kingdom: “If your people are the key to great performance, then facilitating their enjoyment, engagement, and commitment are fundamental to ultimate success…. Our values are intended to change people’s lives for the better.” When UKRD leaders visit one of the 17 stations around the country for a meeting, they build in plenty of time to talk to people and say goodbyes around the station. Every year, all of the company’s teams take a day out to talk together about the values, behaviors, and working environment they want. UKRD has a “cast-iron commitment” to a people first culture, and any manager who doesn’t live up to that is asked to leave.65

Consistency Culture The consistency culture has an internal focus and a dependability orientation for a stable environment. The culture supports a methodical, rational, orderly way of doing business. Following the rules and being thrifty are valued. The organization succeeds by being highly integrated and efficient.

Safeco Insurance has functioned well with a consistency culture. Employees take their coffee breaks at an assigned time, and a dress code specifies white shirts and suits for men and no beards. However, employees like this culture—reliability is highly valued and extra work isn’t required. The consistency culture works for the insurance company, and Safeco succeeds because it can be trusted to deliver on insurance policies as agreed.66 In today’s fast-changing world, very few orga- nizations operate in a stable environment, and most leaders are shifting away from this type of culture because of a need for greater flexibility. However, even some software companies, such as SAS Institute and Pacific Edge Software (now part of Serena Software), have used some elements of the consistency culture to keep projects on time and on budget and to ensure saner lives for employees. Emphasis on order and discipline means the formal workweek at SAS can be 35 hours, for instance.67

NEW LEADER ACTION MEMO As a leader, you can align the organization’s culture to its strategy and the needs of the external environment. You can choose to implement the appropriate culture (adapt- ability, achievement, involve- ment, or consistency) depending on environmental requirements and the organi- zation’s strategic focus.

CHAPTER 14 SHAPING CULTURE AND VALUES 445

Involvement culture culture with an internal focus on the involvement and participation of em- ployees to meet changing expectations from the external environment

Consistency culture culture with an internal focus and consistency orientation for a stable environment

Each of the four cultures can be successful. The relative emphasis on various cul- tural values depends on the organization’s strategic focus and the needs of the exter- nal environment. Leaders might have preferences for the values associated with one type of culture, but they learn to adjust the values they emulate and encourage, depending on the needs of the organization. It is the responsibility of leaders to ensure that organizations don’t get stuck relying on cultural values that worked in the past but are no longer effective. As environmental conditions and strategy change, leaders work to instill new cultural values to help the organization meet new needs.

ETHICAL VALUES IN ORGANIZATIONS Organizations incorporate many types of values into their cultures. Taunton Press, for example, lists its cultural values as “integrity, teamwork, excellence, independent thinking, and creativity.” Zappos, the online retailer, has a slightly offbeat list of core values that includes: “create fun and a little weirdness,” “deliver WOW through ser- vice,” and “be adventurous, creative, and open-minded.”68 Some values that seem to be important to many companies today, whatever the industry or type of culture, include open communication, teamwork, and quality.

In addition, of the values that make up an organization’s culture, ethical values have gained renewed emphasis in today’s era of financial scandals and moral lapses. Ethics is the code of principles and values that governs the behavior of a person or group with respect to what is right or wrong. Ethics sets standards as to what is good or bad in conduct and decision making.69 Chapter 6 discussed ethics and moral leadership in detail.

Most organizations that remain successful over the long term have leaders who include ethical values as part of the formal policies and informal cultures of their companies. Commentators on the recent crisis in the mortgage system, for instance, point out that a big part of the problem was a lack of ethical values that guided employee behavior. “Technical economics is crucial to understanding the crisis, but only goes so far,” one wrote. “There was a hint that more than technical fac- tors were involved when subprime loans were referred to as ‘liar’s loans.’”70 In response to the recent crisis, some business schools and students are taking a fresh look at how future business leaders are trained.

IN THE LEAD Harvard Business School, Columbia Business School, Yale School of Management, Wharton School of the University of Pennsylvania Some members of the 2009 graduating class of Harvard Business School did something unusual. They signed a voluntary student-led pledge saying that the goal of a business leader is to “serve the greater good” and promising that they will act responsibly and ethi- cally and refrain from advancing their “own narrow ambitions” at the expense of others.

At Harvard and other business schools, there has been an explosion of interest in ethics classes and activities that focus on personal and corporate responsibility. Many students, as well as educators, are recognizing a need to give future leaders a deeper understanding of how to practice ethical leadership rather than just how to make money. At Columbia Business School, which requires an ethics course, students formed a popular “Leadership and Ethics

Ethics the code of moral principles and values that governs the behavior of a person or group with respect to what is right and wrong

446 PART 5 THE LEADER AS SOCIAL ARCHITECT

Board” that sponsors lectures and other activities. Yale School of Management has developed sessions in its core curriculum related to the recent crisis and worked with the Aspen Institute to create a curriculum aimed at teaching business students how to act on their values at work. About 55 business schools are using all or part of the curriculum in pilot programs.

Professor Diana C. Robertson at the Wharton School of the University of Pennsylvania says she sees a generational shift, with today’s students expressing a greater concern for how organizations affect the community, the lives of employees, and the natural environment. “There is a feeling that we want our lives to mean something more and to run organizations for the greater good,” said Max Anderson, one of the organizers of Harvard’s pledge. “No one wants to have their future criticized as a place filled with unethical behaviors.”71

Changing how future leaders are trained could be one key to solving the ethics deficit pervading organizations. In a survey about unethical conduct in the work- place, more than half of the respondents cited poor leadership as a factor.72 Leaders can create and sustain a climate that emphasizes ethical behavior for all employees.

VALUES-BASED LEADERSHIP Values in organizations are developed and strengthened primarily through values- based leadership, an influence relationship between leaders and followers that is based on shared, strongly internalized values that emphasize the common good and are consistently advocated and acted upon by the leader. Values-based leaders give meaning to activities and goals by connecting them to deeply held values.73

Leaders influence organizational culture by demonstrating their personal values and by practicing spiritual leadership.

Personal Values Employees learn about values from watching leaders. Values-based leaders generate a high level of trust and respect from employees based not just on stated values but on the courage, determination, and self-sacrifice they demonstrate in upholding those values. Leaders have to discover their own personal values and the values they want to guide the team or organization, and actively communicate the values to others through both words and actions.74 When faced with difficult decisions, values-based leaders know what they stand for, and they have the courage to act on their principles.

Consider the example of Costco, where cofounder and former CEO Jim Sinegal and new CEO Craig Jelinek believe treating people right matters.

IN THE LEAD Jim Sinegal and Craig Jelinek, Costco In 2009, as the recession deepened and many employers were slashing jobs and cutting salaries, Costco CEO Jim Sinegal was handing out raises. Costco is the second-largest retailer in the United States, behind Walmart, and while Walmart leaders are seeing growing troubles, Costco leaders seem to be seeing nothing but growing sales and profits. In early 2013, the

Go to Cengage- NOW to com- plete an online questionnaire that examines how you feel

about certain student beha- viors that might be considered unethical.

Values-based leadership an influence relationship between leaders and fol- lowers that is based on shared, strongly internalized values that emphasize the common good and are consistently advocated and acted upon by the leader

CHAPTER 14 SHAPING CULTURE AND VALUES 447

company’s profit soared to $537 million, proving that paying employees above-average wages and treating them well in other ways can pay off. Since 2009, Costco’s sales have grown 39 percent and the stock price has doubled.

Minimum wage in the United States is still a paltry $7.25 per hour, but Costco’s starting hourly wage is around $12.00. Because people stay around so long, the average hourly wage paid to Costco workers is $20.89, and the company offers good health-care benefits even to part-time employees. New CEO Craig Jelinek recently wrote a public letter urging Congress to increase the minimum wage. The letter sparked an interest in Costco’s culture and business philosophy. Wall Street has repeatedly been critical of Costco leaders, asking them to reduce wages and health benefits. Instead, leaders have increased them every three years since the company began. In 2009, according to CFO Richard Galanti, “the first thing out of Jim [Sinegal’s] mouth was, ‘This economy is bad. We should be figuring out how to give them more, not less.’ ” Galanti admits Costco could make more money if the average wage was two or three dollars lower. “But we’re not going to do it.”

Jelinek, who took over as CEO in 2012, has vowed to continue Sinegal’s values-based legacy. For instance, Jelinek is paid well, but the CEO earns only about 28 times the amount as the average employee, whereas CEOs in many companies early a whopping 380 times more than the average employee. Costco doesn’t hire business school graduates as man- agers. It cultivates employees who work the floor and sponsors them through graduate school. Seventy percent of Costco’s warehouse managers started by ringing cash registers and pushing carts. Turnover is around 5 percent, extremely low for the retail industry. “If you treat consumers with respect and treat employees with respect, good things are going to happen to you,” Jelinek says.75

Leaders at Costco believe values of taking a long-term view and treating people humanely are just good business. Other conscientious companies known for treat- ing people well, such as Nordstrom, Whole Foods Market, and the Container Store, are supporting that idea. All have prospered and outpaced their rivals in recent years. “A lot of people working [in retail] go home and live below the poverty line. You expect that person to come in and develop a rapport with customers who may be spending more than the person is making in a week?” says Doug Ste- phens, founder of the consulting firm Retail Prophet.76

The values at Costco are based largely on the personal values of founders Jim Sinegal and Jeffrey Brotman. Several factors contribute to an individual leader’s values. Every individual brings a set of personal beliefs, personality characteristics, and behavior traits to the job. The family backgrounds and spiritual beliefs of lea- ders often provide principles and values by which they conduct business, and these are sometimes incorporated into the organizational culture. In terms of ethical values, personality characteristics such as ego strength, self-confidence, and a strong sense of independence may enable leaders to make the right decisions even if those decisions might be unpopular.

Spiritual Values Costco is an example of a company where leaders incorporate values that might be considered spiritual into their workplace practices and policies.77 Managers who incorporate spiritual values in addition to the traditional mental and behavioral aspects of leadership tend to be successful as leaders. Values and practices consid- ered as spiritual ideals include integrity, humility, respect, appreciation for the

NEW LEADER ACTION MEMO As a leader, you can be ethical and act on high moral princi- ples in your daily behavior. You can help people find deeper fulfillment in their jobs. Complete Leader’s Self-Insight 14.3 to see if you might be a leader who incorporates spiritual values as part of the corporate culture.

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contributions of others, fair treatment, and personal reflection. This approach to leadership can be effective because many people are struggling with how to com- bine their spiritual journey and their work life.78

Polls indicate that American managers as well as workers would like deeper fulfillment on the job, and evidence suggests that workplace spirituality programs provide people with better mental and physical health, an enhanced sense of self- worth, and greater personal growth, while organizations benefit from increased productivity along with reduced absenteeism and turnover.79 Some companies have put chaplains on the payroll to help people as they struggle with problems that might or might not relate to the business. “You’re at work 8 to 10 hours a day,” says Tim Embry, owner of American LubeFast, a chain of oil change companies. “Work is where people are at and where they need to be cared for.”80

However, even leaders who don’t provide formal spirituality programs can lead with spiritual values. Consider India-born Sanjiv Das, who took over as president and CEO of CitiMortgage in July 2008 in the midst of the housing crisis. Das approached the job with goals of keeping people in their homes and keeping employees focused on the help they could offer to alleviate the financial pressure of those caught in economic turmoil. By doing so, he helped demoralized employees find purpose, meaning, and self-respect again. CitiMortgage went further than

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 14.3

How Spiritual Are You?

Instructions: Think about your current life. Indicate whether each of the following items is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I often reflect on the meaning of life.

2. I want to find a community where I can grow spiritually.

3. I have made real personal sacri- fices in order to make the world a better place.

4. Sometimes when I look at an ordinary thing I feel that I am seeing it fresh for the first time.

5. I sometimes have unexpected flashes of insight or understand- ing while relaxing.

6. It is important to me to find meaning and mission in the world.

7. I often feel a strong sense of unity or connection with all the people around me.

8. I have had experiences that made my role in life clear to me.

9. After reflecting on something for a long time, I have learned to trust my feelings rather than logical reasons.

10. I am often transfixed by loveli- ness in nature.

Scoring and Interpretation Spiritual leadership engages people in higher values and missions and tries to create a corporate culture based on love and community rather than fear and separation. Spiritual leadership is not for everyone, but when spiritual ideals guide a leader’s behavior, an excellent culture can be created.

Add the number of Mostly True answers for your score: . A score of 7 or above indicates that you are highly spiritual and will likely become a values- based or spiritual leader. A score of 4–6 would suggest that you are spiritually average. A score of 0–3 means that you may be skeptical about developing spiritual awareness.

Sources: Based on Kirsi Tirri, Petri Nokelainen, and Martin Ubani, “Conceptual Definition and Empirical Validation of the Spiritual Sensi- tivity Scale,” Journal of Empirical Theology 19, no. 1 (2006), pp. 37–62; and Jeffrey Kluger, “Is God in Our Genes?” Time (October 25, 2004), pp. 62–72.

| D re am

st im e. co m

449 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

many banks to help people keep their homes. Das pioneered a first-of-its-kind pro- gram to temporarily lower payments and waive interest and penalties for borrowers who had lost their jobs. Das says his leadership approach is based in the spiritual values he learned growing up in Delhi—such as maintaining purpose and integrity during difficult times and helping others rather than trying to acquire more materi- als goods for oneself.81

Spiritual leadership is the display of values, attitudes, and behaviors necessary to intrinsically motivate oneself and others toward a sense of spiritual expression through calling and membership.82 As illustrated in Exhibit 14.5, spiritual leaders start by creating a vision through which organization participants experience a sense of calling that gives meaning to their work. An appropriate vision would have broad appeal, reflect high ideals, and establish a standard of excellence. Sec- ond, spiritual leaders establish a corporate culture based on altruistic love. Altruistic love includes forgiveness, genuine caring, compassion, kindness, honesty, patience, courage, and appreciation, which enables people to experience a sense of member- ship and feel understood. Spiritual leaders also engage hope and faith to help the organization achieve desired outcomes. Faith is demonstrated through action. Faith means believing in the ability to excel, exercising self-control, and striving for excellence to achieve a personal best. A leader’s hope/faith includes persever- ance, endurance, stretch goals, and a clear expectation of victory through effort.83

As illustrated in Exhibit 14.5, spiritual leadership behaviors enable employees to have a sense of calling that provides deeper life meaning through work. Spiritual leadership also provides a sense of membership through a work community in which one feels understood and appreciated. The outcome for the organization is improved commitment and productivity.

Spiritual leadership, such as that of Sanjiv Das at CitiMortgage, can decrease or eliminate negative emotions and conflicts in the workplace and provide a stronger foundation for personal well-being.84 The four main types of destructive emotions are (1) fear, including anxiety and worry; (2) anger, including hostility, resentment, and jealousy; (3) sense of failure, including discouragement and depressed mood;

EXHIBIT 14.5 Model of Spiritual Leadership

Sources: Based on Louis W. Fry, Sean T. Hannah, Michael Noel, and Fred O. Walumbwa, “Impact of Spiritual Leadership on Unit Performance,” The Leadership Quarterly 22 (2011), pp. 259-270; and Louis W. Fry, “Toward a Theory of Spiritual Leadership,” The Leadership Quarterly 14 (2003), pp. 693-727. Used with permission.

Spiritual leadership the display of values, atti- tudes, and behaviors neces- sary to intrinsically motivate oneself and others toward a sense of spiritual expression through calling and membership

450 PART 5 THE LEADER AS SOCIAL ARCHITECT

and (4) pride, including prejudice, selfishness, and conceit. These destructive emotions typically arise from fear of losing something important or not getting something one desires.

Spiritual leadership is related to ideas discussed in Chapter 8 on motivation and Chapter 6 on moral leadership. The spiritual leader addresses followers’ higher- order needs for membership and self-actualization. This is intrinsic motivation at its best because work provides interest and enjoyment for its own sake. People are actively engaged in tasks they find meaningful, interesting, or fun. Intrinsic motiva- tion is typically associated with better learning, higher performance, and enhanced well-being. Spiritual leadership often provides substantial autonomy and self- management, for example, through participation in empowered teams that direct activities and do work that is significant and meaningful. An employee’s task involvement is under the control of the individual or team, thereby providing feed- back and satisfaction through achievement, performance, and problem solving. The spiritual leader, like the servant leader described in Chapter 6, engages people in work that provides both service and meaning and creates a positive impact on employees and the community.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • Creating the right culture is one of the most important jobs of the leader. Cul-

ture is the set of key values, norms, and assumptions that is shared by members of an organization and taught to new members as correct. Culture serves two critically important functions—to integrate organizational members so they know how to relate to one another and to help the organization adapt to the environment.

• Strong, responsive cultures have a positive impact on organizational outcomes. Creating and influencing a responsive culture is important because the right culture can drive high performance. Leaders build high-performance cultures by emphasizing both values and solid business operations as the drivers of organizational success.

• A culture gap exists when an organization’s culture is not in alignment with the needs of the external environment or company strategy. Leaders use ceremo- nies, stories, symbols, specialized language, selection, and socialization to instill and strengthen the needed cultural values. In addition, leaders influence cultural values most strongly through their daily actions.

• Leaders consider the external environment and the company’s vision and strat- egy in determining which values are important for the organization. Four types of culture may exist in organizations: adaptability, achievement, involvement, and consistency. Each type emphasizes different values, although organizations may have values that fall into more than one category.

• Many types of values make up an organization’s culture; ethical values are consid- ered among the most important. Ethics is the code of moral principles and values that governs the behavior of a person or group with respect to what is right or wrong. Leaders shape cultural values through values-based leadership. They know their personal values and beliefs and the values they want the organization

Tw itt er

CHAPTER 14 SHAPING CULTURE AND VALUES 451

to honor. Many good leaders practice spiritual leadership, which means displaying values, attitudes, and behaviors that motivate people toward a sense of spiritual expression through calling and membership. The principles of spiritual leadership can improve both organizational performance and employee well-being.

DISCUSSION QUESTIONS 1. How difficult would it be for you as a leader to fire someone who is bringing in big

sales and profits for the company but not living up to the cultural values? Explain.

2. How might leaders use symbolic acts to strengthen a cultural value of teamwork and collaboration? How about a value of customer care and responsiveness?

3. Describe the culture for an organization you are familiar with. Identify some physical artifacts—such as logo, mascot, building, advertising images—associated with the com- pany and discuss what underlying values these suggest. What did you learn?

4. Name one or two companies in the news that seem to have strong corporate cultures, and describe whether the results have been positive or negative. Discuss how a strong culture could have either positive or negative consequences for an organization.

5. As a leader, how might you recognize a culture gap? What techniques might you use to influence and change cultural values when necessary?

6. Compare and contrast the achievement culture with the involvement culture. What are some possible disadvantages of having a strong involvement culture? A strong achieve- ment culture?

7. If you were the leader of a small technology firm, how might you imprint in people’s minds the values shown in Exhibit 14.2 for responsive cultures in order to create a high performance culture? Be specific with your ideas.

8. Discuss the meaning of calling and membership, as related to spiritual leadership. Iden- tify an organization or leader that uses these concepts. To what extent were these con- cepts present where you have worked?

9. If a leader directs her health-care company to reward hospital managers strictly on hospital profits, what kind of values is she encouraging within the company culture? Discuss.

10. Some mortgage company leaders have said that providing subprime mortgages (earn a commission by making loans to people at high interest rates who may have difficulty making the payments) was based on the noble purpose of giving poor people a chance to participate in the American dream of home ownership. Discuss your opinion of this explanation.

11. Some people believe that all good leadership is spiritual in nature. Others think spiritual values have no place at work. Discuss these two opposing viewpoints.

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C a C

LEADERSHIP AT WORK Walk the Talk Often in an organization the culture is characterized both by what people say (talk) and by what people actually do (walk). When this happens, there is a gap between organizational leaders’ espoused values and the values in action within the company. One example would be an espoused value of “a balanced life for employees,” whereas managers and employees are actually expected to work nights and weekends to meet demanding performance goals. This is the difference between the “walk” and the “talk” in an organization.

452 PART 5 THE LEADER AS SOCIAL ARCHITECT

Your assignment for this exercise is to think of one example in your own student or work experience where the walk and talk in a corporate culture did not align. Why do you think the gap occurred? Then interview four other people for examples of when an organiza- tion’s espoused values did not align with the values in action. Also ask them why they think the walk and talk differed. Summarize the findings from your interviews:

My example (and why):

Second person’s examples (and why):

Third person’s examples (and why):

Fourth person’s examples (and why):

Fifth person’s examples (and why):

What patterns and themes do you see in the responses? Is there a common type of walk/ talk gap? What is the most common reason why these gaps occur? Which is the real culture— the leader’s espoused values or the values in action?

CHAPTER 14 SHAPING CULTURE AND VALUES 453

In Class: Students can be organized into small groups in class and do this exercise all at once. Each person in the circle can give examples from student or work experiences of an organization’s walk not fitting its talk and explain why he or she thinks the gaps occurred. Then students can identify the common themes from their discussion. The instructor can help students probe into this issue by writing good examples from students on the board and asking students to help identify key themes. Students can be engaged to discuss the walk versus talk phenomenon via key questions, such as: What does it mean to you when you discover a walk/talk gap in your organization? Are espoused values or values-in-action more indicative of a company’s culture (or are both the culture)? Are walk/talk gaps likely to be associated with a responsive culture? A strong culture? Do symbols, stories, ceremo- nies, and other signals of corporate culture mean what they imply?

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C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS Culture Clash CEO Jane Lionel has some hard decisions to make with regard to some of the company’s older hands, and even on the eve of that decision, I believe she is wavering about what she should do. I will be in that meeting, assisting with that decision, and I’m not certain which way to go either. And so here I am, sorting through and writing down my thoughts.

When Jim Lionel started manufacturing heavy-duty construction equipment here in Alaska 40 years ago, his personal management style reflected the ruggedness of Alaska and the con- struction business. He understood that he was producing tough equipment for tough men work- ing in an unforgiving environment. At 6 5 and over 300 pounds, Lionel personified the bigger- than-life image of Alaskan workers. He had a no-nonsense management style. He coddled no one. Jim Lionel expected and got results. He chewed—not smoked—a cigar. I swear that in the 30 years I worked for him, I never saw that thing lit up as he barked—yes, barked—orders.

I’d have to say that Jim Lionel gained respect because he always delivered and his word was his bond. But he never achieved admiration. There was no finesse. A new HR director once mentioned to me that Jim should create bonds with his workers through techniques such as management by walking around. I said, “Believe me, you do not want him walking around—that simply means he’s stressed and he’s mad.” You could actually feel him and hear him before you saw him, and as one employee said, “When he barked your name, your heart stopped, because until that moment you were certain that he did not know your name.” We all figured that his temper would explode one day and he would die on the shop floor from a heart attack. Then suddenly, he did.

Following his death, we were certain that the company would have to be sold in order to continue operations. However, Jim’s one true friend and confidante was his wife Jane, and with unanimous board approval, she moved in to take his place as the head of the com- pany. The initial concerns and fears of employees were soon calmed. Jane knew the com- pany to a degree that surprised employees. But her management style, developed over 20 years as head of marketing for a regional health-care organization, was in stark contrast to that of her husband.

While Jane shared her husband’s goals and high standards for quality and on-time delivery, she also believed in the importance of demonstrating to employees their value to the company. She not only communicated her vision, but she took the time to listen to the employees, to give them opportunities to voice opinions, express concerns, and submit ideas. She met regularly with individual departments and assisted line workers in the movement toward self-managed teams. The reaction from workers was positive. And a year later we can see a huge change. Production is up slightly, but the real change can be seen in people’s attitudes and pride in their jobs. Communication and the overall level of civility among employees have improved dramatically. But while these cultural changes have been embraced by the majority of workers and supervisors, there are two glaring exceptions.

454 PART 5 THE LEADER AS SOCIAL ARCHITECT

Supervisors Curtis Willett and Morgan Elder were among the first people hired by Jim Lionel. Their long service to the organization and their consistency in meeting all production goals and deadlines is impressive. They take pride in their ability to push themselves and their crews relentlessly. However, their management styles are a throw-back to the old cul- ture. They succeed by intimidation. The civility and cooperation that characterizes other parts of the plant is shoved aside or drowned out in a barrage of yelling. “Shock and Awe,” the joint nickname briefly given to the two men by employees following the 2003 U.S. aerial assault on Iraq, has been revived. If these men are aware of the label, they are probably proud.

So here’s our dilemma: They are too old to change. Curtis and Morgan not only do not fit the new culture, but through tactics of control and intimidation they also encourage workers to ignore the new cultural initiatives. Everyone is on board except the employees in these two adjoining areas of the plant. So we cannot reach the full potential of the new cul- ture while the old culture pulls us back. Fire them? Demote them? I don’t think so. They’ve done nothing wrong. Their crews are meeting their production and quality targets. Further- more, these two guys have been with the company for 40 years. A move on our part that appears unjustified opens us to an age discrimination suit. But I also don’t see how we can change the culture unless they leave.

So, we meet tomorrow to determine what we can do. Writing about a problem usually helps me to sort things out. When I finish, I generally have an answer or at least an idea about how to proceed. I’ve finished writing. And I haven’t got a clue.

QUESTIONS

1. What options do you think Jane and her management team should consider with regard to these two long-time supervisors? Discuss the positives and negatives of each option.

2. Do you think it is appropriate for Jane to remove two long-time, high-performing man- agers in order to create a new culture for everyone else? Why? Consider the material in Exhibit 14.3 in your answer.

3. What do you recommend that Jane do? Explain why.

5 Star and Amtech 5 Star Electronics and Amtech Electronics both manufacture integrated circuits and other electronic parts as subcontractors for large manufacturers. Both 5 Star and Amtech are located in Ohio and often bid on contracts as competitors. As subcontractors, both firms benefited from the electronics boom of the 1990s, and both looked forward to growth and expansion. 5 Star has annual sales of about $100 million and employs 950 people. Amtech has annual sales of $80 million and employs about 800 people. 5 Star typically reports greater net profits than Amtech.

The president of 5 Star, John Tyler, believed that 5 Star was the far superior com- pany. Tyler credited his firm’s greater effectiveness to his managers’ ability to run a “tight ship.” 5 Star had detailed organization charts and job descriptions. Tyler believed that everyone should have clear responsibilities and narrowly defined jobs, which gener- ates efficient performance and high company profits. Employees were generally satisfied with their jobs at 5 Star, although some managers wished for more empowerment opportunities.

Amtech’s president, Jim Rawls, did not believe in organization charts. He believed orga- nization charts just put artificial barriers between specialists who should be working together. He encouraged people to communicate face to face rather than with written memos. The head of mechanical engineering said, “Jim spends too much time making sure everyone understands what we’re doing and listening to suggestions.” Rawls was concerned with employee satisfaction and wanted everyone to feel part of the organization. Employees were often rotated among departments so they would be familiar with activities throughout the company. Although Amtech wasn’t as profitable as 5 Star, they were able to bring new

CHAPTER 14 SHAPING CULTURE AND VALUES 455

products on line more quickly, work bugs out of new designs more accurately, and achieve higher quality because of superb employee commitment and collaboration.

It is the end of May, and John Tyler, president of 5 Star, has just announced the acqui- sition of Amtech Electronics. Both management teams are proud of their cultures and have unflattering opinions of the other’s. Each company’s customers are rather loyal, and their technologies are compatible, so Tyler believes a combined company will be even more effec- tive, particularly in a time of rapid change in both technology and products.

The Amtech managers resisted the idea of an acquisition, but the 5 Star president is determined to unify the two companies quickly, increase the new firm’s marketing position, and revitalize product lines—all by year end.

QUESTIONS

1. Using the competing values model in Exhibit 14.4, what type of culture (adaptability, achievement, involvement, consistency) would you say is dominant at 5 Star? At Amtech? What is your evidence?

2. Is there a culture gap? Which type of culture do you think is most appropriate for the newly merged company? Why?

3. If you were John Tyler, what techniques would you use to integrate and shape the culture to overcome the culture gap?

Sources: Adapted from John F. Veiga, “The Paradoxical Twins: Acme and Omega Electronics,” in John F. Veiga and John N. Yanouzas, The Dynamics of Organization Theory (St. Paul: West Publishing, 1984), pp. 132–138; and “Alpha and Amtech,” Harvard Business School Case 9-488-003, published by the President and Fellows of Harvard College, 1988.

REFERENCES 1. Alex Taylor III, “The New GM: A Report Card,” Fortune (September

5, 2011), pp. 38–46; Alan Murray, “Women in a Man’s World: Dan Akerson of General Motors on Changing a Male-Dominated Culture,” The Wall Street Journal (May 7, 2012), p. B11; Alex Taylor III, “Most Powerful Women: Big Wheel at GM,” Fortune (December 24, 2012), p. 22; and Jeff Bennett, “CEO Akerson Sets Goals for a Revitalized GM” (Boss Talk), The Wall Street Journal ( J a n u a r y 8 , 2 0 1 3 ) , h t t p : / / o n l i n e . w s j . c o m / a r t i c l e / S B 1 0 0 0 1424127887323482504578229852571958928.html (accessed June 5, 2013).

2. Sanam Islam, “Execs See Link to Bottom Line; Gap Is Closing; More Firms Keen to Be Seen as Best Corporate Culture,” National Post (November 19, 2008), p. FP.16; Jeremy Kahn, “What Makes a Company Great?” Fortune (October 26, 1998), p. 218; James C. Collins and Jerry I. Porras, Built to Last: Successful Habits of Visionary Companies (New York: HarperBusiness, 1994); and James C. Collins, “Change Is Good—But First Know What Should Never Change,” Fortune (May 29, 1995), p. 141.

3. Islam, “Execs See Link to Bottom Line.”

4. T. E. Deal and A. A. Kennedy, The New Corporate Cultures: Revitalizing the Workforce after Downsizing, Mergers, and Reengi- neering (New York: Basic Books, 2000).

5. Islam, “Execs See Link to Bottom Line.”

6. Andrew Klein, “Corporate Culture: Its Value as a Resource for Competitive Advantage,” Journal of Business Strategy 32, no. 2 (2011), pp. 21–28; Yoash Wiener, “Forms of Value Systems: A Focus on Organizational Effectiveness and Culture Change and Mainte- nance,” Academy of Management Review 13 (1988), pp. 534–545; V. Lynne Meek, “Organizational Culture: Origins and Weaknesses,” Organization Studies 9 (1988), pp. 453–473; and John J. Sherwood,

“Creating Work Cultures with Competitive Advantage,” Organiza- tional Dynamics (Winter 1988), pp. 5–27.

7. Geoff Colvin, “The Defiant One,” Fortune (April 30, 2007), pp. 86–92.

8. W. Jack Duncan, “Organizational Culture: Getting a ‘Fix’ on an Elusive Concept,” Academy of Management Executive 3 (1989), pp. 229–236; Linda Smircich, “Concepts of Culture and Organiza- tional Analysis,” Administrative Science Quarterly 28 (1983), pp. 339–358; and Andrew D. Brown and Ken Starkey, “The Effect of Organizational Culture on Communication and Information,” Journal of Management Studies 31, no. 6 (November 1994), pp. 807–828.

9. Edgar H. Schein, “Organizational Culture,” American Psychologist 45, no. 2 (February 1990), pp. 109–119.

10. This discussion of the levels of culture is based on Edgar H. Schein, Organizational Culture and Leadership, 2nd ed. (San Francisco: Jossey-Bass, 1992), pp. 3–27.

11. Chris Blackhurst, “Sir Stuart Hampson,” Management Today (July 2005), pp. 48–53.

12. John P. Kotter and James L. Heskett, Corporate Culture and Performance (New York: The Free Press, 1992), p. 6.

13. Peter B. Scott-Morgan, “Barriers to a High-Performance Business,” Management Review (July 1993), pp. 37–41.

14. Jim Kanir, “Culture Champions,” T D (January 2013), p. 80.

15. Arthur Ciancutti and Thomas Steding, “Trust Fund,” Business 2.0 (June 13, 2000), pp. 105–117.

16. Robert Bruce Shaw and Mark Ronald, “Changing Culture—Patience Is Not a Virtue,” Leader to Leader (Fall 2012), pp. 50–55.

17. Example described in Shaw and Ronald, “Changing Culture— Patience Is Not a Virtue.”

456 PART 5 THE LEADER AS SOCIAL ARCHITECT

18. Lisa DiCarlo, “How Lou Gerstner Got IBM to Dance,” Forbes.com (November 11, 2002), http://www.forbes.com/2002/11/11/ cx_ld_1112gerstner.html (accessed June 5, 2013).

19. Bernard Arogyaswamy and Charles M. Byles, “Organizational Culture: Internal and External Fits,” Journal of Management 13 (1987), pp. 647–659.

20. William D. Cohan, House of Cards: A Tale of Hubris and Wretched Excess on Wall Street (New York: Doubleday 2009); Chuck Leddy, “When Wall Street Bet the House,” Boston Globe (March 28, 2009), p. G8; and Robin Sidel and Kate Kelly, “Bear Stearns a Year Later: From Fabled to Forgotten—Bear’s Name, and Culture, Fade Away after J.P. Morgan’s Fire-Sale Deal,” The Wall Street Journal (March 14, 2009), p. B1.

21. Kotter and Heskett, Corporate Culture and Performance.

22. This discussion and the exhibit are based on Kotter and Heskett, Corporate Culture and Performance, p. 51

23. Ralph H. Kilmann, Mary J. Saxton, Roy Serpa, and Associates, Gaining Control of the Corporate Culture (San Francisco: Jossey-Bass, 1985).

24. Larry Mallak, “Understanding and Changing Your Organization’s Culture,” Industrial Management (March–April 2001), pp. 18–24.

25. Kris Maher, “Post Massey Merger, Alpha CEO Makes Safety Priority No. 1” (Boss Talk), The Wall Street Journal (August 8, 2011), http:// online.wsj.com/article/SB10001424053111903885604576490 391464803316.html (accessed June 5, 2013).

26. Reported in Chip Jarnagan and John W. Slocum, Jr., “Creating Corporate Cultures Through Mythopoetic Leadership,” Organiza- tional Dynamics 36, no. 3 (2007), pp. 288–302.

27. Jennifer A. Chatman and Sandra Eunyoung Cha, “Leading by Leveraging Culture,” California Management Review 45, no. 4 (Summer 2003), pp. 20–34; and Jeff Rosenthal and Mary Ann Masarech, “High-Performance Cultures: How Values Can Drive Business Results,” Journal of Organizational Excellence 22, no. 2 (Spring 2003), pp. 3–18.

28. Abby Ghobadian and Nicholas O’Regan, “The Link between Culture, Strategy and Performance in Manufacturing SMEs,” Journal of General Management 28, no. 1 (Autumn, 2002), pp. 16–34; G. G. Gordon and N. DiTomaso, “Predicting Corporate Performance from Organisational Culture,” Journal of Management Studies 29, no. 6 (1992), pp. 783–798; G. A. Marcoulides and R. H. Heck, “Organizational Culture and Performance: Proposing and Testing a Model,” Organization Science 4 (1993), pp. 209–225; Micah R. Kee, “Corporate Culture Makes a Fiscal Difference,” Industrial Manage- ment (November–December 2003), pp. 16–20; and Rosenthal and Masarech, “High-Performance Cultures: How Values Can Drive Business Results.”

29. John P. Kotter and John Heskett, Corporate Culture and Performance (New York: The Free Press, 1992).

30. Tressie Wright Muldrow, Timothy Buckley, and Brigitte W. Schay, “Creating High-Performance Organizations in the Public Sector,” Human Resource Management 41, no. 3 (Fall 2002), pp. 341–354.

31. This section is based on Rosenthal and Masarech, “High-Performance Cultures: How Values Can Drive Business Results.”

32. Nelson D. Schwartz, “One Brick at a Time,” Fortune (June 12, 2006), pp. 45–46; and Nelson D. Schwartz, “Lego’s Rebuilds Legacy,” International Herald Tribune (September 5, 2009).

33. Evelyn M. Ruslie, “Zynga’s Tough Culture Risks a Talent Drain,” The New York Times Online (November 27, 2011), http://dealbook. nytimes.com/2011/11/27/zyngas-tough-culture-risks-a-talent-drain/ (accessed June 18, 2012).

34. Rosenthal and Masarech, “High-Performance Cultures.”

35. Dave Ulrich, Steve Kerr, and Ron Ashkenas, The GE Work-Out (New York: McGraw-Hill, 2002), pp. 238–230.

36. “Core Value: Teamwork,” segment in Leigh Buchanan, “2011 Top Small Company Workplaces: Core Values,” Inc. (June 2011), pp. 60–74; and “Our Story,” Menlo Innovations Web site, http:// www.menloinnovations.com/our-story/history and http://www.menlo innovations.com/our-story/culture (accessed September 12, 2011).

37. Reggie Van Lee, Lisa Fabish, and Nancy McGaw, “The Value of Corporate Values: A Booz Allen Hamilton/Aspen Institute Survey,” strategy business 39 (Summer 2005), pp. 52–65.

38. Rosenthal and Masarech, “High-Performance Cultures”; Patrick M. Lencioni, “Make Your Values Mean Something,” Harvard Business Review (July 2002), pp. 113–117; and Thomas J. Peters and Robert H. Waterman, Jr., In Search of Excellence (New York: Warner, 1988).

39. “About Canada’s 10: Canada’s 10 Most Admired Corporate Cultures, 2005–2012,” Waterstone Human Capital Web site, http:// www.waterstonehc.com/cmac/about-canadas-10/10-most-admired- corporate-cultures-2005-2011 (accessed June 6, 2013); Andrew Wahl, “Culture Shock,” Canadian Business (October 10–23, 2005), pp. 115–116; Calvin Leung, Michelle Magnan, and Andrew Wahl, “People Power,” Canadian Business (October 10–23, 2005), pp. 125–126; and John Izzo, “Step-Up Initiative: Create a Culture of Initiators,” Leadership Excellence (June 2012), p. 13.

40. Harrison M. Trice and Janice M. Beyer, “Studying Organizational Culture through Rites and Ceremonials,” Academy of Management Review 9 (1984), pp. 653–669.

41. Alan Farnham, “Mary Kay’s Lessons in Leadership,” Fortune (September 20, 1993), pp. 68–77.

42. John Marshall and Matthew Adamic, “The Story Is the Message: Shaping Corporate Culture,” Journal of Business Strategy 31, no. 2 (2010), pp. 18–23.

43. Joanne Martin, Organizational Culture: Mapping the Terrain (Thousand Oaks, CA: Sage Publications, 2002), 71–72.

44. Adam Bryant, “What’s Your Story? Tell It, and You May Win a Prize” (Corner Office column, an interview with Russell Goldsmith), The New York Times (April 21, 2012), http://www.nytimes.com/ 2012/04/22/business/russell-goldsmith-of-city-national-on-storytellings- power.html?_r=0 (accessed April 29, 2013).

45. Sam Silverstein, “Sustainable Culture: Create One of Your Own,” Leadership Excellence (December 2012), pp. 17–18; and Joan O’C. Hamilton, “Why Rivals Are Quaking as Nordstrom Heads East,” BusinessWeek (June 15, 1987), pp. 99–100.

46. Christoph H. Loch, Fabian J. Sting, Arnd Huchzermeier, and Christiane Decker, “Finding the Profit in Fairness,” Harvard Business Review (September 2012), pp. 111–115; and Doug Kirkpatrick, “Self- Management’s Success at Morning Star,” T D (October 2012), pp. 25–27.

47. Leslie Kwoh, “Memo to Staff: Take More Risks; CEOs Urge Employees to Embrace Failure and Keep Trying” (Theory & Practice column), The Wall Street Journal (March 20, 2013), p. B8.

48. Ian D. Colville and Anthony J. Murphy, “Leadership as the Enabler of Strategizing and Organizing,” Long Range Planning 39 (2006), pp. 663–677.

49. D. C. Feldman, “The Multiple Socialization of Organization M emb ers ,” Aca d emy o f M an ag emen t Rev i ew 6 (1 9 8 1 ), pp. 309–318; J. Van Maanen, “Breaking In: Socialization to Work,” in R. Dubin, ed., Handbook of Work, Organization, and Society (Chicago: Rand-McNally, 1976), p. 67; and Blake E. Ashforth and Alan M. Saks, “Socialization Tactics: Longitudinal Effects on Newcomer Adjustment,” Academy of Management Journal 39, no. 1 (February 1996), pp. 149–178.

CHAPTER 14 SHAPING CULTURE AND VALUES 457

50. Leigh Buchanan, “Managing: Welcome Aboard. Now, Run!” Inc. (March 2010), pp. 95–96.

51. Helena D. C. Thomas and Neil Anderson, “Changes in Newcomers’ Psychological Contracts during Organizational Socialization: A Study of Recruits Entering the British Army,” Journal of Organizational Behavior 19, no. 1 (1998), pp. 745–767.

52. Ashforth and Saks, “Socialization Tactics.”

53. Deanne N. Den Hartog, Jaap J. Van Muijen, and Paul L. Koopman, “Linking Transformational Leadership and Organizational Culture,” The Journal of Leadership Studies 3, no. 4 (1996), pp. 68–83; and Schein, “Organizational Culture.”

54. Aili McConnon, “Lessons from a Skinflint CEO,” BusinessWeek (October 6, 2008), pp. 54–55.

55. Joann S. Lublin, “Can a New Culture Fix Troubled Companies?” The Wall Street Journal (March 13, 2013), p. B1.

56. Jack and Suzy Welch, “Opinion: Goldman, Wall Street, and the Culture-Killing Lesson Being Ignored,” Fortune (April 30, 2012), p. 56.

57. Margot Patrick, “Barclays Tells Staff to Uphold New Values or Leave,” The Wall Street Journal (January 17, 2013), http://online.wsj .com/article/SB10001424127887323468604578247461697635932 .html (accessed June 7, 2013).

58. Ram Charan and Jerry Useem, “Why Companies Fail,” Fortune (May 27, 2002), pp. 50–62.

59. Jennifer A. Chatman and Karen A. Jehn, “Assessing the Relationship between Industry Characteristics and Organizational Culture: How Different Can You Be?” Academy of Management Journal 37, no. 3 (1994), pp. 522–553.

60. James R. Detert, Roger G. Schroeder, and John J. Mauriel, “A Framework for Linking Culture and Improvement Initiatives in Organizations,” Academy of Management Review 25, no. 4 (2000), pp. 850–863.

61. Paul McDonald and Jeffrey Gandz, “Getting Value from Shared Values,” Organizational Dynamics 21, no. 3 (Winter 1992), pp. 64–76; and Daniel R. Denison and Aneil K. Mishra, “Toward a Theory of Organizational Culture and Effectiveness,” Organization Science 6, no. 2 (March–April 1995), pp. 204–223.

62. Adam Levie, as told to Memon Yaqub, “I’m Obsessed with Speed,” Inc. (November 2012), pp. 100–103.

63. Robert Hooijberg and Frank Petrock, “On Cultural Change: Using the Competing Values Framework to Help Leaders Execute a Transformational Strategy,” Human Resource Management 32, no. 1 (1993), pp. 29–50.

64. Matt Moffett, “At InBev, a Gung-Ho Culture Rules; American Icon Anheuser, A Potential Target, Faces Prospect of Big Changes,” The Wall Street Journal (May 28, 2008), p. B1; and Matt Moffett, “InBev’s Chief Built Competitive Culture,” The Wall Street Journal (June 13, 2008), p. B6.

65. William Rogers, “Sound Advice,” People Management (August 2012), pp. 40–43.

66. Carey Quan Jelernter, “Safeco: Success Depends Partly on Fitting the Mold,” Seattle Times (June 5, 1986), p. D8.

67. Gerald D. Klein, “Creating Cultures That Lead to Success: Lincoln Electric, Southwest Airlines, and SAS Institute,” Organizational Dynamics 41 (2012), pp. 32–43; and Rekha Balu, “Pacific Edge Projects Itself,” Fast Company (October 2000), pp. 371–381.

68. “Our Culture,” Taunton Press Web site, http://www.taunton.com /thetauntonpress/our_culture.asp (accessed April 28, 2013); and Tony Hsieh, Delivering Happiness: A Path to Profits, Passion, and Purpose (New York: Business Plus, 2012).

69. Gordon F. Shea, Practical Ethics (New York: American Management Association, 1988); and Linda Klebe Treviño, “Ethical Decision

Making in Organizations: A Person–Situation Interactionist Model,” Academy of Management Review 11 (1986), pp. 601–617.

70. Brian Griffiths, “Markets Can’t Be Improved by Rules, Only by Personal Example,” The Times (April 9, 2009), p. 30.

71. Leslie Wayne, “A Promise to Be Ethical in an Era of Temptation,” The New York Times (May 30, 2009), p. B1; and Kelley Holland, “Is It Time to Retrain B-Schools?” The New York Times (March 15, 2009), p. BU1.

72. Alison Boyd, “Employee Traps—Corruption in the Workplace,” Management Review 86, no. 8 (September 1997), p. 9.

73. Based on “What Is Values-Based Leadership?” Values-Based Leader- ship Institute, Royal Roads University, http://values-based-leadership. institute.royalroads.ca/content/what-values-based-leadership (accessed July 12, 2013); K. Dean, “Values-Based Leadership: How Our Personal Values Impact the Workplace,” The Journal of Values- Based Leadership 1, no. 1 (2008), pp. 60–67; and Robert J. House, “Path-Goal Theory of Leadership: Lessons, Legacy, and a Reformu- lated Theory,” Leadership Quarterly 7, no. 3 (1996), pp. 323–352.

74. Alan Lewis, “Values Compass: Align around True North Values,” Leadership Excellence (February 2012), p. 13; Krista Jaakson, “Management by Values: Are Some Values Better than Others?” Journal of Management Development 29, no. 9 (2010), pp. 795–806; and Kathy Whitmire, “Leading through Shared Values,” Leader to Leader (Summer 2005), pp. 48–54.

75. Brad Stone, “Costco CEO Craig Jelinek Leads the Cheapest, Happiest Company in the World,” Bloomberg Businessweek (June 6, 2013), http://www.businessweek.com/articles/2013-06-06/costco-ceo-craig- jelinek-leads-the-cheapest-happiest-company-in-the-world (accessed June 7, 2013); “Costco’s Profit Soars to $537 Million Just Days after CEO Endorses Minimum Wage Increase,” The Huffington Post (March 13, 2013), http://www.huffingtonpost.com/2013/03/12 /costco-profit_n_2859250.html (accessed June 7, 2013); Bud Meyers, “Hail to the Chief (Executive Officer) Craig Jelinek of Costco!,” The Daily Kos (March 8, 2013), http://www.dailykos.com/story/2013/03 /08/1192632/-Hail-to-the-Chief-Executive-Officer-Craig-Jelinek-of- Costco (accessed June 8, 2013); and Satinder Dhiman and Joan Marques, “The Role and Need of Offering Workshops and Courses on Workplace Spirituality,” Journal of Management Development 30, no. 9 (2011), pp. 816–835.

76. Stone, “Costco CEO Craig Jelinek Leads the Cheapest, Happiest Company in the World.”

77. Dhiman and Marques, “The Role and Need of Offering Workshops and Courses on Workplace Spirituality.”

78. Laura Reave, “Spiritual Values and Practices Related to Leadership Effectiveness,” The Leadership Quarterly 16 (2005), pp. 655–687; and Louis W. Fry, Sean T. Hannah, Michael Noel, and Fred O. Walumbwa, “Impact of Spiritual Leadership on Unit Performance,” The Leadership Quarterly 22 (2011), pp. 259–270.

79. Fry et al., “Impact of Spiritual Leadership on Unit Performance; R. A. Giacalone and C. L. Jurkiewicz, “Toward a Science of Workplace Spirituality,” in R. A. Giacalone and C. L. Jurkiewicz, eds., Handbook of Workplace Spirituality and Organizational Performance (New York: M. E. Sharp, 2003), pp. 3–28; K. Krahnke, R. A. Giacalone, and C. L. Jurkiewicz, “Point-Counterpoint: Measuring Workplace Spiritual- ity,” Journal of Organizational Change Management 16, no. 4 (2003), pp. 396–405; Louis W. Fry, “Toward a Theory of Ethical and Spiritual Well-Being, and Corporate Social Responsibility through Spiritual Leadership,” in R. A. Giacalone, ed., Positive Psychology in Business Ethics and Corporate Responsibility (Greenwich, CT: Information Age Publishing, 2005), pp. 47–83; and I. I. Mitroff and E. A. Denton, A Spiritual Audit of Corporate America (San Francisco: Jossey-Bass, 1999).

80. Neela Banerjee, “At Bosses’ Invitation, Chaplains Come into Work- place and onto Payroll,” The New York Times (December 4, 2006), p. A16.

458 PART 5 THE LEADER AS SOCIAL ARCHITECT

81. Stephanie Armour, “CEO Helps People Keep Their Homes; That’s CitiMortgage Chief’s Personal Goal,” USA Today (April 27, 2009), p. B4; Ruth Simon, “Citi to Allow Jobless to Pay Less on Mortgages for a Time,” The Wall Street Journal Europe (March 4, 2009), p. 17; and Sanjiv Das, “Viewpoint: Early Intervention Can Stem Fore- closures,” American Banker (December 10, 2008), p. 11.

82. Louis W. Fry, “Toward a Theory of Spiritual Leadership,” The Leadership Quarterly 14 (2003), pp. 693–727; and Fry et al., “Impact of Spiritual Leadership on Unit Performance.”

83. Ibid.

84. Fry, “Toward a Theory of Spiritual Leadership.”

CHAPTER 14 SHAPING CULTURE AND VALUES 459

Chapter 15: Leading Change

Ed w ar de s/ St on e/ G et ty Im ag es

YOUR LEADERSHIP CHALLENGE After reading this chapter, you should be able to:

• Recognize the environmental forces creating a need for change in today’s organizations. • Describe the qualities of a change leader and how leaders can serve as role models for change. • Implement the eight-stage model of planned change. • Use appreciative inquiry to engage people in creating change by focusing on the positive and

learning from success.

• Apply techniques of enabling immersion, facilitating brainstorming, promoting lateral thinking, allowing pauses, and nurturing creative intuition to expand your own and others’ creativity and facilitate organizational innovation.

• Provide a positive emotional attractor, supportive relationships, repetition of new behaviors, participation and involvement, and after-action reviews to overcome resistance and help people change.

CHAPTER OUTLINE 462 Leadership Means Leading

Change

465 A Framework for Change

467 Using Appreciative Inquiry

471 Leading Creativity for Change

479 Implementing Change

In the Lead

464 Michelle Rhee, Washington, D.C., Public School System

470 The Red Team

481 Dr. Dean Ornish, University of California at San Francisco

Leader’s Self-Insight

464 Resistance to Change

468 Are You a Change Leader?

474 Do You Have a Creative Personality?

Leader’s Bookshelf

471 Switch: How to Change Things When Change Is Hard

Leadership at Work

484 Organizational Change Role Play

Leadership Development: Cases for Analysis

486 “From This Point On …”

487 Riverside Pediatric Associates

I s J.C. Penney dead? Not yet, but it is clearly on life support. Ron Johnson, a former Apple executive known for his creativity, was hired to rescue the company only to be fired 17 months later, most of his changes shelved as former CEO

Myron Ullman returned to try to rebuild the struggling retailer. Hopes were high for Johnson both within and outside the company. When he took over, J.C. Penney needed radical change, but his approach to implementing changes doomed them almost from the start. Early in his tenure, Johnson threw a party to celebrate himself and his plans for the company, a move that irked both employees and customers. He also began poking fun at the company’s traditional way of doing business almost from the moment he took the job. Employees felt that the new managers Johnson brought in ridiculed them and made them feel dumb and uninteresting. Johnson refused to listen to long-established leaders, customers, or employees and even shunned suggestions made by board members. He got rid of many of J.C. Penney’s long-standing processes and systems, radically redesigned many stores, and eliminated hundreds of brands, even running an Oscars ad telling customers they “deserved to look better.” Customers decided they deserved to shop at a store where they were respected, instead. Some analysts say rolling out changes too soon and with little input from others drove old customers away without giving new ones any reason to try the

461 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

retailer, in essence, offering pain but no gain. “Anytime you’re trying to change the way you do things, small wins are important,” said Michael Roberto, a management professor at Bryant University. “Small wins help you build support both internally and externally, and they make it easier for people to buy in.”1

As the example of J.C. Penney illustrates, change—especially radical change—is tough to accomplish. Johnson made mistakes, but major turnarounds are exceedingly difficult for any leader, especially in retail. One study indicates that leader efforts at just getting a money-losing retailer back to profitability succeed only 30 percent of the time.2 This chapter explores how leaders in companies such as J.C. Penney can facilitate change, creativity, and innovation. We first look briefly at the role of leader as change agent and examine a step-by-step framework for leading change. We explore the appreciative inquiry (AI) technique and how it can be used to lead both major changes and ongoing, everyday change. Next, the chapter examines how leaders instill the conditions that nurture creativity within people and organizations. The final sections of the chapter consider why people resist change and how leaders can overcome resistance and help people successfully make needed changes.

LEADERSHIP MEANS LEADING CHANGE It is the job of the leader to make sure organizations change as needed to respond to threats, opportunities, or shifts in the environment. Recall from our definition used throughout this book that leadership is about change rather than stability. Leaders have to help people see the need for change and buy into a new way of doing things.

Change is necessary if organizations are to survive and thrive, and the sharp down- turn in the economy, combined with other environmental shifts, has forced leaders in all industries to take a fresh look at how they do business. The recent turmoil is not only pressuring leaders to rethink the economics of their business but has also brought changes in social attitudes that require new leadership responses.3 Exhibit 15.1 shows

EXHIBIT 15.1 Forces Driving the Need for Change Leadership

20 15

462 PART 5 THE LEADER AS SOCIAL ARCHITECT

some of the environmental forces, such as rapidly changing technologies, shifting social attitudes, globalization, increasing government regulation, changing markets, the growth of e-business, and the swift spread of information via the Internet, that are creating a greater need for change leadership within organizations.4

Resistance Is Real Leaders initiate many changes, but most of these don’t meet expectations. Consider that among leaders in 166 U.S. and European companies making major changes, only about one-third reported success in most types of their changes. Some studies have estimated that 90 percent of strategies fail to achieve intended objectives and that 70 percent of all change initiatives in organizations fail.5

There are many reasons why change programs don’t produce the intended results. One significant problem is that most people have a natural tendency to resist change—even when the changes are ones that could make their lives better. At Comalco, a rolled products company based in New South Wales, Australia, for example, leaders wanted to make changes to create a more egalitarian work- place with less separation between management and workers. They did away with all the separate uniforms for electricians, fitters, operators, foremen, and so forth; eliminated the time clock for hourly workers; and got rid of the separate parking lot for managers. Each change was resisted. Employees said they liked the uniforms because they were less costly and identified who they were com- pared to wearing different clothes every day. Workers were strongly opposed to elimination of the time clock because, they said, “We won’t be able to prove we’ve been to work, so they’ll be able to cheat us on our pay.” They were suspi- cious that doing away with the managers’ car parking was so employees couldn’t see that managers could afford a new car every year.6 If people resist changes designed to add value to their lives, imagine what it is like trying to implement changes that significantly shift their job responsibilities, task procedures, or work interactions!

Leaders should be prepared for resistance and find ways to enable people to see the value in changes that are needed for the organization to succeed. Later in this chapter, we will talk about how leaders can overcome resistance and help people successfully change.

The Leader as Change Agent Change does not happen easily, but good leaders can facilitate needed changes to help the organization adapt to external threats and new opportunities. For people throughout the organization to view change as positive and natural, they need leaders who serve as role models for change and provide the motivation and communication to keep change efforts moving forward. Research has identified some key characteristics of leaders who can accomplish successful change projects: 7

• They define themselves as change leaders rather than people who want to maintain the status quo.

• They demonstrate courage. • They believe in employees’ capacity to assume responsibility. • They are able to assimilate and articulate values that promote adaptability. • They recognize and learn from their own mistakes. • They are capable of managing complexity, uncertainty, and ambiguity. • They have vision and can describe their vision for the future in vivid terms.

NEW LEADER ACTION MEMO Complete the questions in Leader’s Self-Insight 15.1 to see if you have a natural tendency to resist change.

CHAPTER 15 LEADING CHANGE 463

Michelle Rhee, former chancellor of the Washington, D.C., public school system, provides a good example of the characteristics of a change leader.

IN THE LEAD Michelle Rhee, Washington, D.C., Public School System Michelle Rhee, former chancellor of Washington, D.C., public schools and founder of StudentsFirst, is one of the most controversial figures in U.S. education, but love her or hate her you can’t say she’s afraid of change. A daughter of Korean immigrants, Rhee wanted to quit halfway through her first year in Teach for America, the organization we described in Chapter 1 that sends new college graduates into some of America’s tough- est schools, but her father made her go back and finish the job. That’s where she first embarked on a personal mission to change the system for America’s poorest students. Rhee noticed that students responded to teachers who pushed them hard and kept them interested.

A couple of decades later, Rhee had the chance to put some of her change ideas into action on a large scale as she tried to revamp one of the most expensive, worst performing school systems in the country. As chancellor of the D.C. public schools, Rhee attacked the dysfunctional culture that rewarded teachers for seniority rather than performance, revised

Complete this assignment online with CengageNOW.

C a CLEADER’S SELF-INSIGHT 15.1

Resistance to Change

Instructions: Please respond to each item below based on how you handle day-to-day issues in your life. Think care- fully in order to be as accurate as possible.

Mostly False

Mostly True

1. I generally consider changes in my life to be a negative thing.

2. When I am told of a change of plans, I may tense up a bit.

3. Once I have made plans, I am not likely to change them.

4. I often change my mind. 5. Whenever my life fits a stable

routine, I look for ways to change it.

6. I feel less stress when things go according to plan.

7. I sometimes avoid making per- sonal changes even when the change would be good for me.

8. My views are very consistent over time.

9. I prefer a routine day to a day full of unexpected surprises.

10. If I were informed of a significant change in my work, I would tighten up.

11. When someone pressures me to change something, I tend to resist it.

12. Once I have come to a conclusion, I stick to it.

Scoring and Interpretation Give yourself one point for each Mostly True answer to items 1 to 3 and 6 to 12 above and for each Mostly False to items 4 and 5. Everyone feels some resistance to change but people do differ in their tolerance for frequent change. A higher score of 8 or above on this scale means you probably prefer a predictable and routine life. Frequent or dramatic changes at work may be difficult for you, probably creating feelings of resistance, stress, and tension. If you received a score of 5 or lower, your resistance to change may be low, so you probably find surprises and changes to be somewhat stimulating.

Source: Based on Shaul Oreg, “Resistance to Change: Developing an Individual Differences Measure,” Journal of Applied Psychology 88, no. 4 (2003), pp. 680–693. Used with permission.

| D re am

st im e. co m

464 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

systems and structures to slash bureaucracy, held school principals accountable for improv- ing student performance, and focused people on a mission of putting the best interests of students first.

Her vision of making D.C. schools “the highest-performing urban school district in the nation” brought new energy and movement to a long-stagnant system. “We have a system that does wrong by poor kids of color,” Rhee said. “If we’re going to live up to our promise as a country … that has got to stop.” Rhee becomes angry when people say “teachers can- not make up for what parents and students will not do,” emphasizing that each teacher can make a difference. She didn’t hesitate to cut administrative positions that weren’t contribut- ing value, fire teachers and principals who didn’t meet performance standards, and close underperforming schools. She instituted new procedures to handsomely reward high- performing teachers and give principals more control over hiring, promoting, and firing. New evaluation procedures put people on alert that low performance and complacency would not be tolerated.8

Rhee continues to drive change after leaving D.C. Her current organization, StudentsFirst, has a mission to ensure great teachers, access to great schools, and effective use of public dollars across the United States. “Some people think she is a transformative leader, and some people think she is a controversial figure, but everyone agrees she gets people talking,” said one organizer of a recent conference in Michigan.9

A FRAMEWORK FOR CHANGE When leading a major change project, it is important for leaders to recognize that the change process goes through stages, each stage is important, and each may require a significant amount of time. Exhibit 15.2 shows a model developed by John Kotter that can help leaders navigate the change process.10

1. Light a fire for change. People have to believe that change is really needed. Leaders communicate the urgency for change in a way that touches people’s emotions—in other words, they help people feel the need for change rather than just giving them facts and figures. Consider Peter Löscher, the first outsider ever hired as CEO of Siemens, who says “never miss the opportunities that come from a good crisis.” Löscher stepped in at a very difficult time, with the company facing bribery charges, and he needed to make massive changes in structure and culture. He spent his first 100 days traveling around the world talking with employees about how the bribery scandal had tarnished Siemens’s proud heritage.11

2. Get the right people on board. Considering the complexities of change, no single person can implement a change, especially a major one, alone. For success- ful change, leaders build a strong coalition of people with a shared commitment to the need for and possibility of change. They include people with enough power to make sure the change happens, as well as people who can make the change more acceptable to end users.

3. Paint a compelling picture. People need a clear vision and strategy to inspire them to believe that a better future is possible and they can achieve it through their actions. The energy for true change comes from seeing how the change

CHAPTER 15 LEADING CHANGE 465

can be positive for individuals and the organization. Leaders create a picture that helps people understand why the organization is undertaking the effort and how the change will help achieve long-term goals. It’s also important to develop a strategy for achieving the vision and let people know how they fit into the big picture.

4. Communicate, communicate, communicate. Leaders tell the message not just once but over and over again. Change throws everyone into doubt and uncer- tainty, and people don’t listen well when they feel anxious. Another point to remember is that actions speak louder than words. Change leaders model the new behaviors needed from employees. At Siemens, Peter Löscher mapped the amount of time the company’s top executives spent with customers and pre- sented it at the annual leadership conference. Löscher was number 1, having spent 50 percent of his time with customers. He told people that had to change and that the rankings would be presented each year to see if people running the businesses were honoring the new focus on customer contact.12

5. Get rid of obstacles and empower people to act. Leaders give people the time, knowledge, resources, and discretion to take steps and make the change hap- pen. This might mean revising structures, systems, or procedures that hinder or undermine the change effort. After setting a vision and broad outline for change, Bill Glavin, CEO of OppenheimerFunds, Inc., gives his team members leeway to move forward with their own ideas for implementing desired

EXHIBIT 15.2 The Eight-Stage Model of Planned Organizational Change

Source: Based on John P. Kotter, Leading Change (Boston: Harvard Business School Press, 1996), p. 21.

466 PART 5 THE LEADER AS SOCIAL ARCHITECT

changes. “I meet with each direct report every two weeks and try to keep a light hand on the tiller,” Glavin says.13

6. Achieve and celebrate quick wins. Unless people see positive results of their efforts, energy and motivation can wane during a major change project. To keep the momentum going, leaders identify some short-term accomplishments that people can recognize and celebrate. A highly visible and successful short- term accomplishment boosts the credibility of the change process and renews everyone’s enthusiasm and commitment.

7. Keep it moving. Don’t get stuck on short-term wins. One study suggests that nearly 50 percent of all change initiatives crumble simply from lack of atten- tion.14 It’s important for leaders to build on the credibility of early accomplish- ments and keep the change process moving forward. At this stage, they confront and change any remaining issues, structures, or systems that are get- ting in the way of achieving the vision.

8. Find ways to make the changes stick. At this stage, leaders look for ways to institutionalize the new approach, striving to integrate the new values and pat- terns into everyone’s work habits. At Del-Air, a Florida heating, ventilation, and air conditioning contractor, managers linked a new GPS-enabled time- tracking system with the company’s bonus system. Employees who are more efficient with their time get rewarded for it. By integrating the change with the incentive system, managers made the new time-tracking system an accepted, integral part of everyone’s daily work.15

Stages in the change process generally overlap, but each of these stages is impor- tant for successful change to occur. When dealing with a major change effort, leaders can use the eight-stage change process to provide a strong foundation for success.

USING APPRECIATIVE INQUIRY One of the most exciting approaches to leading change is a process known as appreciative inquiry. Appreciative inquiry (AI) engages individuals, teams, or the entire organization in creating change by reinforcing positive messages and focusing on learning from success.16 Rather than looking at a situation from the viewpoint of what is wrong and who is to blame for it, AI takes a positive, affirming approach by asking, “What is possible? What do we want to achieve?” For example, rather than looking at a problem such as decreasing sales, AI would investigate what makes sales increase. Appropriately framing a topic—to investigate what is right rather than what is wrong—is critical to the success of AI because it gets people away from blame, defensiveness, and denial and sets a positive framework for change. As David Cooperrider, cocreator of the AI methodology, puts it, “the more you study the true, the good, the better, the possible within living human systems, the more the capacity for positive transformation.”17 AI can be applied on either a large or small scale.

Applying Appreciative Inquiry on a Large Scale AI can accelerate large-scale organizational change by positively engaging a large group of people in the change process, including leaders and employees, as well as people from outside the organization, such as customers or clients, partners, and other stakeholders.

NEW LEADER ACTION MEMO As a leader, you can develop the personal characteristics to be a change leader. To improve the success of a major change, you can follow the eight-stage model for leading change, re- membering to devote the necessary time, energy, and resources to each stage.

NEW LEADER ACTION MEMO Answer the questions in Leader’s Self-Insight 15.2 to see if you have what it takes to initiate changes and follow the eight-stage model of change.

CHAPTER 15 LEADING CHANGE 467

Appreciative inquiry a technique for leading change that engages indivi- duals, teams, or the entire organization by reinforcing positive messages and focusing on learning from success

Once a topic has been identified for exploration, the group follows a four-stage AI process, as illustrated in Exhibit 15.3.18

1. Discovery. In the discovery stage, people identify “the best of what exists”—the organization’s key strengths and best practices. This stage is about discovering the unique qualities of the group that have contributed to success. Leaders interview people, asking them to tell stories that identify the best of their experiences with the organization. During an AI session focused on building a winning culture at American Express, for example, leaders asked people to describe an instance when they felt the most proud working for the company. Based on these stories, people together identify common themes.

2. Dream. Next, people reflect on what they learned during the discovery stage and imagine what it would be like if these extraordinary experiences were the norm—what if people at American Express, for instance, experienced the kind of environment every day that made them feel proud of working for American Express? The dream stage is about imagining “what could be” and creating a shared vision of the best possible future, grounded in the reality of what

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C a CLEADER’S SELF-INSIGHT 15.2

Are You a Change Leader?

Instructions: Think specifically of your current or a recent full- time job. Please answer the following 10 questions according to your perspective and behaviors in that job. Indicate whether each item is Mostly False or Mostly True for you.

Mostly False

Mostly True

1. I often tried to adopt improved procedures for doing my job.

2. I often tried to change how my job was executed in order to be more effective.

3. I often tried to bring about improved procedures for the work unit or department.

4. I often tried to institute new work methods that were more effective for the company.

5. I often tried to change organiza- tional rules or policies that were nonproductive or counterproductive.

6. I often made constructive suggestions for improving how things operate within the organization.

7. I often tried to correct a faulty procedure or practice.

8. I often tried to eliminate redun- dant or unnecessary procedures.

9. I often tried to implement solu- tions to pressing organizational problems.

10. I often tried to introduce new structures, technologies, or approaches to improve efficiency.

Scoring and Interpretation Please add the number of items for which you marked Mostly True, which is your score: . This instrument measures the extent to which people take charge of change in the workplace. Change leaders are seen as change initia- tors. A score of 7 or above indicates a strong take-charge attitude toward change. A score of 3 or below indicates an attitude of letting someone else worry about change.

Before change leaders can champion large planned change projects via the model in Exhibit 15.2, they often begin by taking charge of change in their workplace area of responsibility. To what extent do you take charge of change in your work or personal life? Compare your score with other students’ scores. How do you compare? Do you see yourself being a change leader?

Source: Academy of Management Journal by E. W. Morrison and C. C. Phelps. Copyright 1999 by Academy of Management. Reproduced with permission of Academy of Management in the format Textbook via Copyright Clearance Center.

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468 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

already exists. By allowing people to express their dreams for the future, AI inspires hope and energy for change.

3. Design. The design stage formulates action plans for transforming dreams into reality. This involves people making decisions about what the organization needs to do in order to be what it wants to be. At American Express, people identified the values that would support the kind of culture they wanted, the leadership behaviors that would instill and support the values, and the struc- tures, systems, and processes that would keep the new cultural values alive.

4. Destiny. The final stage of AI is creating a destiny by translating the ideas iden- tified in the previous stages into concrete action steps. This involves both cele- brating the best of what exists and pushing forward to realize the dream by creating specific programs, activities, and other tangible forces that will imple- ment the design and ensure the continuation of change begun during the AI process. For example, specific changes in training programs, performance eval- uation, and reward systems were part of the destiny stage at American Express.

Using the AI methodology for a large-scale change may involve hundreds of people over a period of several days and may be conducted off-site to enable people to immerse themselves in the process of creating the future. A wide variety of organi- zations, including businesses, school systems, churches and religious organizations, communities, government agencies, and social service organizations, have used AI for large-scale change.19 A team at a large oil refinery in the Middle East used AI to help achieve a vision of making the refinery “the best place in the company to work.”

EXHIBIT 15.3 Four Stages of Appreciative Inquiry

Source: Based on Gabriella Giglio, Silvia Michalcova, and Chris Yates, “Instilling a Culture of Winning at American Express,” Organization Development Journal 25, no. 4 (Winter 2007), pp. 33–37.

CHAPTER 15 LEADING CHANGE 469

IN THE LEAD The Red Team When the general manager (GM) of the oil refinery where they worked asked them to “re- imagine the organization,” the group of young engineers known as the Red Team naturally wondered what he meant.

The GM said he wanted the refinery to be the best place to work in the huge Middle East oil and gas organization. Success, he added, would be measured by the level of happiness among the 1,600 workers at the refinery. Happiness among the workers, the GM believed, would improve safety, performance, and productivity. The Red Team immediately began talking among them- selves and identifying issues and potential recommendations for making the refinery a happier place to work. Then they decided it was a good idea to get input from the other employees.

They came up with a simple theme, based on the word “Smile,” around which to connect people and get their ideas for how to improve morale, motivation, and happiness. Using the AI model, the team asked people to share their best experiences of working at the refinery (Discover), which created an energized and fun atmosphere. Next, people contributed ideas for what they thought the refinery could be if these experiences were the norm (Dream). In the third (Design) stage, ideas included seeing managers more often in the plant, strengthening worker–supervisor relationships, improving the cafeteria menu, providing shade canopies over employee parking areas, and holding regular employee-family appreciation events. Volunteer teams were asked to champion each initiative for follow-up action to turn them into reality (Destiny).

The process has already improved morale by giving people a chance to participate in shap- ing their own future. People have a stronger sense of belonging and commitment, and the vision of being “the best place in the company to work” is well on its way to becoming a reality.20

Applying Appreciative Inquiry Every Day AI can also be applied by individual leaders on a smaller scale. The nature of lead- ership means influencing people in many small ways on an ongoing basis. This chapter’s Bookshelf describes a three-stage change model that incorporates elements of AI and can be used for everyday change efforts. Good leaders work daily to gradually shift attitudes, assumptions, and behavior toward a desired future. When individual leaders in an organization are involved in daily change efforts, they have a powerful cumulative effect.21

Leaders can use the tools of AI for a variety of everyday change initiatives, such as developing followers, strengthening teamwork, solving a particular work issue, or resolving conflicts.22 Again, the key is to frame the issue in a positive way and keep people focused on improvement rather than looking at what went wrong. Jim (Gus) Gustafson, currently Leadership Scholar-in-Residence and Director of Executive Educa- tion in the Center for Values-Driven Leadership at Benedictine University, provides an example of the everyday use of AI. Gustafson loves using AI to develop followers. One example comes from the time he took over as director of sales and marketing for a major electrical manufacturer. While sitting in on several employees’ performance reviews with the outgoing executive, Gustafson noticed that two employees in partic- ular were treated by the outgoing manager with disrespect and disinterest as they were given poor evaluations of their performance. Gustafson used AI by asking the two employees questions such as, “What have you done in the last six months that you are most proud of?” “What is your greatest source of job satisfaction?” and

470 PART 5 THE LEADER AS SOCIAL ARCHITECT

“What motivates you to excel?” He worked with the two to identify how they could be satisfied and productive, carrying forward the best from their past but moving toward a better future. Thanks to Gustafson’s coaching and the use of AI, both employees were eventually promoted to management positions in the organization.23

LEADING CREATIVITY FOR CHANGE The American Management Association asked 500 CEOs the question: “What must one do to survive in the twenty-first century?” The top answer? “Practice cre- ativity and innovation.”24 Effective leaders find ways to promote creativity and innovation particularly in the departments where it is most needed. For example, some organizations, such as hospitals, government agencies, and non-profit organi- zations, may need frequent changes in policies and procedures, and leaders can

LEADER’S BOOKSHELF Switch: How to Change Things When Change Is Hard

by Chip Heath and Dan Heath

“Big changes can start with very small steps. Small changes tend to snowball,” write authors Chip Heath, a professor at the Graduate School of Business at Stan- ford University, and Dan Heath, a senior fellow at Duke University’s Center for Advancement of Social Entrepreneurship. “But this is not the same as saying that change is easy.” Indeed, the stories told in Switch: How to Change Things When Change Is Hard illustrate just how difficult change can be, whether it is a personal change such as losing 40 pounds or an organizational change such as improving how employees treat customers.

A THREE-PART FRAMEWORK FOR CHANGE Switch offers some solid advice that can be applied to both individuals and orga- nizations that need to change. Here is a quick summary of their three-step plan for change:

• Provide Direction: Look for the Bright Spots. The first step involves setting a clear direction and scripting the moves that can help people get there. A key point here is to focus on the positive. Many people facing a need for change are demoralized and depressed. To bring about change, leaders shift peo- ple to thinking about things they have done in the past that were positive and

how to do those kinds of things more often. To help solve the chronic malnutrition problem in Vietnam, for example, the Save the Children organization stopped looking at what was wrong and instead looked for the children who were well-nourished, learned what their parents were doing, and taught the parents of undernourished children to follow the same steps.

• Get Emotional: Motivate People to Change. Why do charitable organiza- tions use photos of needy children to attract donations? Because they appeal to people’s emotions. The lesson is that people don’t “think” their way into a new behavior. Change depends on changing emo- tions. Microsoft leaders kept telling a group of programmers that customers couldn’t figure out how to use a new feature, but the stubborn program- mers thought their software was brilliant. Only when the programmers actually watched customers strug- gling with using the feature and becoming frustrated and unhappy did they start looking for ways to make it more user friendly.

• Shape the Path: Make Change More Comfortable. Old habits die hard, but the opportunity for change

to take hold is enhanced when the new habits are more comfortable. One of the best illustrations of this step comes from Bart Millar, a teacher in Portland, Oregon, who transformed his classroom by getting the most dis- ruptive students to come to class early and sit in the front row. How did he do it? He put a comfortable sofa at the front of his history classroom. It didn’t take long for the students who used to be back-seat wisecrackers to start showing up early enough to get the cool seats.

TEST YOUR CHANGE LEADERSHIP One of the most interesting features of Switch is the use of “Clinics,” which are sidebars describing real-life situations needing change. Readers are invited to apply what they’ve learned from a partic- ular section of the book to craft a change strategy. Then, the authors describe what actually happened and what they would advise based on their change research. The numerous rich examples, combined with research pulled from the fields of psychology, sociology, and other fields, make Switch a fun, inspiring read.

Source: Switch: How to Change Things When Change Is Hard, by Chip Heath and Dan Heath, is published by Broadway Books.

To assess how innovative you are in your personal life, log in to CengageNOW

to complete the interactive questionnaire.

471 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

promote creativity among administrative workers. For companies that rely on new products, leaders promote the generation and sharing of ideas across departments and, increasingly, with outsiders.

Creativity is the generation of ideas that are both novel and useful for improving efficiency or effectiveness of an organization.25 Creative people come up with ideas that may meet perceived needs, solve problems, or respond to opportunities and are therefore adopted by the organization. However, creativity itself is a process rather than an outcome, a journey rather than a destination. One of the most important tasks of leaders today is to harness the creative energy of all employees.

Instilling Creative Values Leaders can build an environment that encourages creativity and helps the organi- zation be more innovative. Fostering a creative culture and promoting collaboration will spread values for creativity throughout the organization.

Foster a Creative Culture For creative acts that benefit the organization to occur con- sistently, the interests and actions of everyone should be aligned with the organization’s purpose, vision, and goals, and leaders should make a commitment of time, energy, and resources to support creativity.26 One popular approach is to provide an idea incubator. An idea incubator provides a safe harbor where ideas from people throughout the orga- nization can be developed without interference from company bureaucracy or politics.27

Companies as diverse as Yahoo, Boeing, Adobe Systems, and UPS have used idea incu- bators to make sure good ideas don’t get lost in the day-to-day organizational system.

To build a culture that encourages corporate entrepreneurship, leaders encourage the creative spirit of all employees by promoting cultural values of curiosity, openness, exploration, and informed risk-taking. At W. L. Gore, best known for Gore-Tex fabrics, leaders basically did away with the rules so that people feel free to explore and experiment. There are no bosses at Gore; people explore ideas on their own and recruit others who believe in and want to work on the idea. That’s how Gore got into businesses as diverse as Glide dental floss, Ride-On bike cables, and Elixir guitar strings.28 One important outcome of entrepreneurship is to facilitate idea champions. Idea champions are people who passionately believe in an idea and fight to overcome natural resistance and convince others of its value. Change does not happen by itself. Personal energy and effort are needed to successfully promote a new idea.

A creative culture is an open culture that encourages people to look everywhere for new ideas. Leaders promote openness by rotating people into different jobs, allowing them time off to participate in volunteer activities, and giving them oppor- tunities to mix with people different from themselves. One aerospace company uses the phrase Get out of Kansas! to stress the importance of looking for novel ideas in the world outside company walls.29 Leaders can also give people opportunities to work with customers, suppliers, and people outside the industry, which contributes to a flow of fresh ideas. Executives at Productos Cementos Mexicanos ride in cement trucks to get ideas about customer needs, for instance.30

Promote Collaboration Although many individuals have creative ideas, creativity soars when people work together. Rather than leaving people stuck in their departmental silos, smart leaders find ways to get people communicating and collaborating across bound- aries. Creative collaboration is one of the most important activities leaders can support for a creative culture.31 That’s one reason companies use cross-functional teams and self- managed teams, as described in Chapter 10. Some remodel their physical spaces so that

NEW LEADER ACTION MEMO Complete the exercise in Leader’s Self-Insight 15.3 to see if you have a creative personality.

472 PART 5 THE LEADER AS SOCIAL ARCHITECT

Creativity the generation of ideas that are both novel and useful for improving efficiency and effectiveness of the organization

Idea incubator a safe harbor where ideas from employees throughout the organization can be developed without interfer- ence from company bu- reaucracy or politics

Corporate entrepreneurship internal entrepreneurial spirit that includes values of ex- ploration, experimentation, and risk taking

Idea champions people who passionately believe in a new idea and actively work to overcome obstacles and resistance

people from different areas work side by side on a daily basis. Many companies use internal Web sites that encourage cross-organizational collaboration. For example, Arup Group, a British engineering services company, developed an online “knowledge map” that shows the company’s different areas of expertise and how departments and employees are connected to one another in terms of important information flows.32

A recent approach to promoting one-on-one collaboration is speedstorming. Speedstorming, as the name suggests, was inspired by the phenomenon of speed- dating. It uses a round-robin format to get people from different areas talking together, generating creative ideas, and identifying areas for potential collaboration. People are divided into pairs, with each person from a different department, and given a specific topic with a goal of generating ideas to pursue collaboratively by the end of each three- to five-minute round. By the end of the session, the goal is for each participant to have formed ideas for creative collaboration with several others. Speedstorming can be a fun experience that enriches existing approaches to collaboration.33

Leading Creative People Many organizations that want to encourage change and innovation strive to hire people who display creative characteristics. However, recent research on creativity suggests that anyone can learn to be creative and can get better at it with practice.34

That is, everyone has roughly equal creative potential. The problem is that many people don’t use that potential. Leaders can help individuals be more creative by facilitating brainstorming, promoting lateral thinking, enabling immersion, allowing pauses, and nurturing creative intuition, as illustrated in Exhibit 15.4.

NEW LEADER ACTION MEMO As a leader, you can help the organization be more innova- tive. You can encourage values of curiosity, openness, and exploration, and give employ- ees time to work with people outside their normal areas. You can build in mechanisms for cross-functional collaboration and information sharing.

EXHIBIT 15.4 Tools for Helping People Be More Creative

Speedstorming using a round-robin format to get people from different areas talking together, generating creative ideas, and identifying areas for potential collaboration

20 15

CHAPTER 15 LEADING CHANGE 473

Facilitate Brainstorming One common way to encourage creativity is to set up brainstorming sessions focused on a specific problem or topic. Assume your organi- zation faces a problem such as how to reduce losses from shoplifting, speed up checkout, reduce food waste, or lessen noise from a machine room. Brainstorming uses a face-to-face interactive group to spontaneously suggest a wide range of crea- tive ideas to solve the problem. The keys to effective brainstorming are:35

1. No criticism. Group members should not criticize or evaluate ideas in any way during the spontaneous generation of ideas. All ideas are considered valuable.

2. Freewheeling is welcome. People should express any idea that comes to mind, no matter how weird or fanciful. Brainstormers should not be timid about expressing creative thinking. As a full-time developer of ideas at Intuit said, “It’s more important to get the stupidest idea out there and build on it than not to have it in the first place.”36

3. Quantity desired. The goal is to generate as many ideas as possible. The more ideas the better. A large quantity of ideas increases the likelihood of finding excellent solutions. Combining ideas is also encouraged. All ideas belong to the group and members should modify and extend ideas whenever possible.

Brainstorming has both ardent supporters and intense critics, but it remains the most common way leaders use groups to generate new ideas.37 Leaders are

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C a CLEADER’S SELF-INSIGHT 15.3

Do You Have a Creative Personality?

Instructions: In the following list, check each adjective that you believe accurately describes your personality. Be very honest and check all the words that fit your personality.

1. affected 16. intelligent 2. capable 17. narrow interests 3. cautious 18. wide interests 4. clever 19. inventive 5. commonplace 20. mannerly 6. confident 21. original 7. conservative 22. reflective 8. conventional 23. resourceful 9. egotistical 24. self-confident

10. dissatisfied 25. sexy 11. honest 26. snobbish 12. humorous 27. sincere 13. individualistic 28. submissive 14. informal 29. suspicious 15. insightful 30. unconventional

Scoring and Interpretation Add one point for checking each of the following words: 2, 4, 6, 9, 12, 13, 14, 15, 16, 18, 19, 21, 22, 23, 24, 25, 26, and 30. Subtract one point for checking each of the following words: 1, 3, 5, 7, 8, 10, 11, 17, 20, 27, 28, and 29. The highest possi- ble score is +18 and the lowest possible score is –12.

The average score for a set of 256 assessed males on this creativity scale was 3.57, and for 126 females was 4.4. A group of 45 male research scientists and a group of 530 male psychology graduate students both had average scores of 6.0, and 124 male architects received an average score of 5.3. A group of 335 female psychology students had an aver- age score of 3.34. If you received a score above 6.0, your per- sonality would be considered above average in creativity.

This adjective checklist was validated by comparing the respondents’ scores to scores on other creativity tests and to creativity assessments of respondents provided by expert judges of creativity. This scale does not provide perfect pre- diction of creativity, but it is reliable and has moderate valid- ity. Your score probably indicates something about your creative personality compared to other people.

To what extent do you think your score reflects your true creativity? Compare your score to others in your class. What is the range of scores among other students? Which adjectives were most important for your score compared to other students? Can you think of types of creativity this test might not measure? How about situations where the crea- tivity reflected on this test might not be very important?

Source: Harrison G. Gough, “A Creative Personality Scale for the Adjective Check List,” Journal of Personality and Social Psychology 37, no. 8 (1979), pp. 1398–1405.

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474

Brainstorming a technique that uses a face- to-face group to spontane- ously suggest a broad range of ideas to solve a problem

continually searching for ways to improve the brainstorming process. Some compa- nies are practicing an extreme type of brainstorming, based on the popularity of television reality shows, that puts people together for an extended time period to come up with ideas. Under a program called Real Whirled, for example, Whirlpool sends teams of eight people to live together for seven weeks—and to use Whirlpool appliances for cooking and cleaning, of course. Best Buy has used a similar pro- gram, with teams of people who previously didn’t know one another living together for 10 weeks in a Los Angeles apartment complex. A new service, Best Buy Studio, which provides web-design consulting for small businesses, came directly out of ideas hatched at one of the sessions.38

Another recent approach, called electronic brainstorming, or brainwriting, brings people together in an interactive group over a computer network.39 People can submit ideas as well as read and extend others’ ideas. Austin, Texas–based ad agency GSD&M uses electronic brainstorming sessions that include outsiders as well as employees to quickly come up with ideas for ad campaigns. Leaders say the sessions generate thousands of ideas, and keeping things anonymous “keeps the boss and the new hire on the same level.”40 Studies show that electronic brainstorming generates about 40 percent more ideas than individuals brainstorming alone, and 25 percent to 200 percent more ideas than regular brainstorming groups, depending on group size.41 Why? Primarily because people participate anonymously, the sky’s the limit in terms of what they feel free to say. Creativity also increases because people can write down their ideas immediately, avoiding the possibility that a good idea might slip away while the person is waiting for a chance to speak in a face-to-face group.

Promote Lateral Thinking Most of a person’s thinking follows a regular groove and somewhat linear pattern from one thought to the next. But linear thinking does not often provide a creative breakthrough. Linear thinking is when people take a problem or idea and then build sequentially from that point. A more creative approach is to use lateral thinking. Lateral thinking can be defined as a set of systematic techniques used for changing mental concepts and perceptions and generating new ones.42 With lateral thinking, people move “sideways” to try different perceptions, different concepts, and different points of entry to gain a novel solution. Lateral thinking appears to solve a problem by an unorthodox or apparently illogical method. Lateral thinking makes an unusual mental connection that is concerned with possibilities and “what might be.”

Companies such as Boeing, Nokia, IBM, and Nestlé have trained people to use lateral thinking as a way to help the organization meet the demands of a rapidly changing global environment.43 To stimulate lateral thinking, leaders provide people with opportunities to use different parts of their brain and thus to make novel, crea- tive connections. If the answer isn’t in the part of the brain being used, it might be in another that can be stimulated by a new experience. Consider the NASA scientist who was taking a shower in a German hotel while pondering how to fix the distorted lenses in the Hubble telescope in 1990. Nobody could figure out how to fit a correc- tive mirror into the hard-to-reach space inside the orbiting telescope. The engineer noticed the European-style showerhead mounted on adjustable rods. This perception connected with the Hubble problem as he realized that corrective mirrors could be extended into the telescope on similar folding arms. Lateral thinking came to the rescue.44 Another example comes from Atlanta pediatrician Amy Baxter, who had been trying for years to find a way to use cold to relieve the pain children felt when getting vaccinations. Driving home tired after an all-night shift at the emergency room, Baxter noticed that the steering wheel was vibrating because she hadn’t had

Electronic brainstorming bringing people together in an interactive group over a computer network; some- times called brainwriting

Lateral thinking a set of systematic techni- ques for breaking away from customary mental concepts and generating new ones

CHAPTER 15 LEADING CHANGE 475

time to get her tires aligned. As she pulled into the driveway, she realized the vibration had made her hands numb. Baxter had a flash of insight—combining vibration and cold might be enough to ease the pain of a shot. Buzzy, a toylike vibrating bee with a tiny ice pack, is now used in around 500 hospitals to ease injection pain for children.45

Alex Osborn, the originator of brainstorming, developed many creative tech- niques. One effective technique that is widely used to stimulate lateral thinking is the checklist in Exhibit 15.5. The checklist seems to work best when there is a current product or service that needs to be improved. If the problem is to modify a cell phone design to increase its sales, for example, the checklist verbs in Exhibit 15.5 can stimulate an array of different perceptions about the item being analyzed.

An exercise of considering opposites will also stretch the mind in a lateral direction. Physical opposites include back/front, big/small, hard/soft, and slow/fast. Biological opposites include young/old, sick/healthy, male/female, and tortoise/hare. Manage- ment opposites would be bureaucratic/entrepreneurial, or top-down/bottom-up. Business opposites are buy/sell, profit/loss, and hire/fire.46

Enable Immersion Lateral thinking might be considered thinking outside the box. Immersion means to go deeply into a single area or topic to spark personal creativity, which has been called thinking “inside the box.”47 One approach to immersion is to focus on the internal aspects of a situation or problem. People can take a product, situation, or process and break it down into component parts. Manipulating the components in unusual ways can create a valuable new idea. For example, contact lenses arose by removing one component—the eyeglass frame. Phillips Electronics rev- olutionized the DVD player by shifting functions from the player to a hand-held device. This manipulation created a slimmer and cheaper DVD player.

Immersion to go deeply into a single area or topic to spark personal creativity

NEW LEADER ACTION MEMO As a leader, you can expand the creative potential of people in the organization by facilitating brainstorming, promoting lat- eral thinking, enabling immer- sion, allowing for pauses, and fostering creative intuition.

EXHIBIT 15.5 Lateral Thinking Checklist

Verb Description

Put to other uses? New ways to use as is? Other uses if modified?

Adapt? What else is like this? What other ideas does this suggest?

Modify? Change meaning, color, motion, sound, odor, form, shape? Other changes?

Magnify? What to add: Greater frequency? Stronger? Larger? Plus ingredient? Exaggerate?

Minify? What to subtract: Eliminate? Smaller? Slower? Lower? Shorter? Lighter? Split up? Less frequent?

Substitute? Who else instead? What else instead? Other place? Other time?

Rearrange? Other layout? Other sequence? Change pace?

Reverse? Transpose positive and negative? How about opposites? Turn it backward? Turn it upside down? Reverse role?

Combine? How about a blend, an alloy, an assortment, an ensemble? Combine units? Combine purposes? Combine appeals? Combine ideas?

Source: Based on Alex Osborn, Applied Imagination (New York: Charles Scribner’s Sons, 1963).

NEW LEADER ACTION MEMO Right now, see if you can think of three additional opposites in each of the categories of physical, biological, manage- ment, and business. Look at opposites to stretch your thinking for a problem you face.

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Another way to get people to break out of habitual thinking patterns and ingrained perceptions is to immerse them in new experiences that give them a different perspective on a familiar topic. Top leaders at a bank wanting to get managers think- ing in new ways sent them not only to visit competing banks but also to an Apple retail store. One executive says it made him see familiar banking in a whole new light. “Many of us in the industry are trying to put lipstick on a pig—making old banking look new and innovative with decorations but not really changing what’s underneath it all, the things that matter most to consumers.”48 Some leaders reorganize frequently to immerse people in different jobs and responsibilities. Frequent change can be unsettling, but it keeps people’s minds fresh and innovative.49

Allow Pauses Some of the best ideas often occur when people take time off from working on a problem and change what they are doing. Allowing pauses activates different parts of the brain. Recent research in creativity suggests that having an “aha moment” often requires that a person stop trying to solve a problem and allow the mind to wander.50 “When you are trying too hard to focus your atten- tion, you are going to miss new ideas,” says Jennifer Wiley, a psychology professor at University of Illinois at Chicago.51

Where or when do you get your best ideas? The most popular response is “in the shower.” One man got good ideas so consistently in the shower that he regu- larly experienced a 20-minute mental core dump of ideas. He purchased a piece of clear plastic and a grease pencil to write down the creative ideas while in his “think tank.” Creativity often occurs during a mental pause, a period of mixed tension and relaxation. In the shower, or while exercising, driving, walking, or meditating, the mind reverts to a neutral, somewhat unfocused state in which it is receptive to issues or themes that have not been resolved. If the analytical part of the mind is too focused and active, it shuts down the spontaneous part. The semi-relaxed men- tal “pause” is like putting the analytical left brain on hold and giving room for the intuitive right brain to find the solution in the subconscious mind.52 C. S. Lewis, author of The Chronicles of Narnia, was fond of long, contemplative walks to facil- itate his creative juices. Similarly, Jerry Kathman, president and CEO of brand design agency LPK, says he gets many of his ideas during his morning jog.53 Exercise is often considered a good way to give the mind a chance to work freely.54

Leaders can apply this idea by allowing people to have quiet spaces when they need them. Simply breaking up a group session and telling people to go take a walk or work on something simple and repetitive for a while can kick start the creative process. David Rock, cofounder of the NeuroLeadership Insti- tute, has worked with leaders in numerous organizations and says leaders have generated a 100 percent to 500 percent improvement in the ability to solve com- plex problems by using techniques and models that allow pauses so that people have mental space to reflect.55

Nurture Creative Intuition The creative flash of insight leaders want to awaken is actually the second stage of creativity. The first stage is data gathering. The mind is gathering data constantly, especially when you are studying background material on a problem to be solved. Then the creative insight bubbles up as an intuition from the deeper subconscious. It may be hard to trust that intuitive process because it seems “soft” to many business executives. The subconscious mind remembers all experiences that the conscious mind has forgotten. Creative intuition has a broader reach than any analytical process focused solely on the problem at hand.

After you plant a seed in the ground, you don’t dig it up every week to see how it is doing. William Coyne, former head of R&D at 3M

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To understand your own creative intuition, consider the following question:56

A man has married 20 women in a small town. All the women are still alive, and none of them is divorced. The man has broken no laws. Who is the man?

If you solved this problem the answer came in a sudden flash: the man is a preacher, priest, or justice of the peace. That flash of insight arose from your crea- tive intuition.

Here are some additional problems that might be a little tougher. Each set of three words below has something in common.57 Do not overanalyze. Instead just relax and see if the common element pops up from your intuition.

1. rat blue cottage

2. pine crab sauce

3. curtain fisherman nuclear reactor

4. envy golf beans

5. bowling alley tailor wrestling match

Don’t rush to find the answers. Give your intuitive subconscious time to work. After it’s finished working on these problems, consider the following question you might be asked if you interview for a job at Microsoft: How would you weigh a large jet aircraft without a scale? This question combines logical thinking and intuition. Before reading on, how might you compute the airplane’s weight doing something that is technologically feasible even if not realistic?58

The next challenge may appear to have no solution until your intuition shows you the obvious answer. In the following illustration, remove three matches to leave four.59

Here is another problem that may force your mind to respond from a different place to get the answer. The matches are an equation of Roman numerals made from ten matches. The equation is incorrect. Can you correct the equation without touching the matches, adding new matches, or taking away any matches?

Have you given adequate time to your creative intuition? The answers to these creative challenges follow:

For the word sets, the correct answers are (1) cheese, (2) apple, (3) rods, (4) green, and (5) pins.

One answer to weighing the jet aircraft would be to taxi the jet onto a ship big enough to hold it. You could put a mark on the hull at the water line and then remove the jet and reload the ship with items of known weight until it sinks to the same mark on the hull. The weight of the items will equal the weight of the jet.

The answer to the first match puzzle depends on how you interpret the word “four.” Rather than counting four matches, remove the matches at the top, bottom, and right and the answer is obvious—the Roman numeral IV. For the second match

478 PART 5 THE LEADER AS SOCIAL ARCHITECT

puzzle, you can solve this problem by looking at it from a different perspective—turn the page upside down. Did your creative intuition come up with good answers?

IMPLEMENTING CHANGE Leaders frequently see innovation, change, and creativity as a way to strengthen the organization, but many people view change only as painful and disruptive. A critical aspect of leading people through change is understanding that resistance to change is natural—and that there are often legitimate reasons for it. This chapter’s Consider This box takes a lighthearted look at why employees may resist changes in some overly bureaucratic organizations.

Consider Dealing with a Dead Horse

Ancient wisdom says that when you discover you are astride a dead horse, the best strategy is to dismount. In government and other overly bureaucratic organizations, many different approaches are tried. Here are some of our favorite strategies for dealing with the “dead horse” scenario:

1. Change the rider. 2. Buy a stronger whip. 3. Beat the horse harder. 4. Shout at and threaten the horse. 5. Appoint a committee to study the horse. 6. Arrange a visit to other sites to see how they ride dead horses. 7. Increase the standards for riding dead horses. 8. Appoint a committee to revive the dead horse. 9. Create a training session to improve riding skills.

10. Explore the state of dead horses in today’s environment. 11. Change the requirements so that the horse no longer meets the standards of death. 12. Hire an external consultant to show how a dead horse can be ridden. 13. Harness several dead horses together to increase speed. 14. Increase funding to improve the horse’s performance. 15. Declare that no horse is too dead to ride. 16. Fund a study to determine if outsourcing will reduce the cost of riding a dead horse. 17. Buy a computer program to enhance the dead horse’s performance. 18. Declare a dead horse less costly to maintain than a live one. 19. Form a work group to find uses for dead horses. And … if all else fails … 20. Promote the dead horse to a supervisory position. Or, in a large corporation, make it a

vice president.

Source: Author unknown. Another version of this story may be found at http://www.abcsmallbiz.com/funny/ deadhorse.html.

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The underlying reason why employees resist change is that it violates the personal compact between workers and the organization.60 Personal compacts are the recipro- cal obligations and commitments that define the relationship between employees and organizations. They include such things as job tasks, performance requirements, evaluation procedures, and compensation packages. These aspects of the compact are generally clearly defined and may be in written form. Other aspects are less clear-cut. The personal compact incorporates elements such as mutual trust and dependence, as well as shared values. When employees perceive that change violates the personal compact, they are likely to resist. For example, a new GM at the Dallas–Fort Worth Marriott wanted to change the incentive system to offer bonuses tied to the hotel’s financial performance, but employees balked. “They were thinking, ‘Here comes the Wicked Witch of the West taking my stuff away,’ ” the manager said. There are tools available to help leaders implement change.

Helping People Change Many leaders don’t understand why change is so difficult for many people. But for something new to begin, something old has to end, and most of us have a hard time letting go of something we value, even if we want something new. For example, we want to lose weight, but giving up the chocolate cake seems too much to ask. Rather than focusing on a new beginning and what we might gain from a change, our emotions are stuck on the ending of our current situation and what we might lose.

Changing behavior always depends on changing people’s emotions about the situation. People have to psychologically and emotionally let go of the old before they can embrace the new.61 Exhibit 15.6 illustrates the transition individuals have to go through to make a successful change. To help someone change means first dealing with the emotions associated with endings and losses rather than denying those emotions or trying to talk people out of feeling them. Then, people move into a neutral zone, where they’ve let go of the old but the new hasn’t yet gelled into an accepted pattern. Finally, they transition into a new beginning. No one gets to a new beginning without first dealing with an ending.

Leaders who want to implement change always have to ask “who’s going to lose what?”62 In organizations, changes in job design, technology, or structure may mean that some people will no longer have the same type of power or pres- tige they once had, for example. Recall from Chapter 14 how a new CEO at Dynergy did away with private offices. Many managers initially resisted the change because they viewed their offices as symbols of their power and prestige

Personal compact the reciprocal obligations and commitments that define the relationship between employees and the organization

EXHIBIT 15.6 Endings Precede Beginnings for Successful Change

Source: Based on ideas in William Bridges, Managing Transitions: Making the Most of Change (Cambridge, MA: Da Capo Lifelong Books, 2009).

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in the organization.63 In addition, when changes are imposed from outside the individual, many people feel a loss of control over their own lives and circum- stances, which provokes a strong emotional reaction. Sometimes a change con- flicts with the goals of some individuals or departments. At pharmaceuticals company Pfizer, top executives wanted to implement a computerized system for collecting and processing research trial data, which could cut 40 percent off the cost of new drug development. Research and development managers fought the change, citing their concern that the automation and standardization of case report forms would hamper their flexibility and creativity.64

Change also means that people have to give up their stable routines. Hospitals that have spent millions of dollars adopting electronic medical records are having a hard time getting doctors to use them. One reason is that electronic records require doctors to change how they go about their daily work, and many are having trou- ble giving up their standard routine.65 Most people have at least some fear of the unknown and are more comfortable dealing with the tried-and-true. Particularly when people don’t understand how a change will affect them, they find it more reassuring to stick with what they know, even if it is unpleasant, than to jump into the unknown.66 Utility companies installing wireless smart meters in states from Maine to California have faced a strong backlash from customers who say the meters invade privacy, increase costs, and threaten health.67 Getting people to switch to new CFL bulbs has been as tough as pulling hens’ teeth, and when the U.S. Energy Independence and Security Act was passed to phase out the manufac- ture and sale of certain wattages of incandescent bulbs, consumers began stockpil- ing them rather than switch to the CFL versions.68

At work, employees might worry that a needed change in work procedures will mean an end to the camaraderie among their work group or fear that a new technol- ogy might cause them to lose autonomy or status. At SuperShuttle, a national transpor- tation provider, for example, drivers were opposed to using GPS-enabled phones. The drivers felt that the new technology meant an end to their freedom, since managers could track their movements. SuperShuttle learned that, “if you don’t tell employees what to expect, they’ll invent something, and inevitably, it will be bad.”69

The Keys That Help People Change Most of us think if we were given a clear choice—change or die—we’d change in a hurry. But in fact, scientific studies demonstrate that most people have a hard time changing even when told that not changing will lead them to an early grave.70

But change is possible. The following example describes how one doctor helped people change by incorporating some elements that have been shown to increase the chances of successful personal change.

IN THE LEAD Dr. Dean Ornish, University of California at San Francisco Dr. Dean Ornish, a professor of medicine at the University of California at San Francisco and founder of the Preventative Medicine Research Institute, found that an astonishing nine of ten critically ill patients couldn’t change their poor diet and exercise habits even though it meant they would die. So, instead of motivating with the “fear of dying,” Dr. Ornish began inspiring people with a clear vision of the “joy of living.”

CHAPTER 15 LEADING CHANGE 481

Dr. Ornish’s studies show that when people feel convinced that they can enjoy life more— such as taking long walks without pain, playing with their grandchildren, enjoying intimacy with their spouse again—they are much more likely to make significant changes in their lifestyle and stick with the changes over the long term. Dr. Ornish worked with 194 patients to help them quit smoking and follow an extreme vegetarian diet that derived fewer than 10 percent of its calories from fat. For a year, the patients participated in group conversations twice a week and took classes in relaxation, meditation, yoga, and aerobic exercise as part of their daily routine. Three years after the program ended, 77 percent had stuck with the lifestyle changes, halting and in some cases reversing the progress of their heart disease.71

Changing people’s thinking and behavior is possible, and the keys to doing so incorporate five elements: a positive emotional attractor, supportive relationships, repe- tition of new behaviors, participation and involvement, and after-action reviews.72

• Provide a positive emotional attractor. A positive emotional attractor (PEA) is something that awakens an individual’s hopes and dreams about the future, about possibilities of what could be, rather than focusing on trying to “fix” weaknesses or shortcomings. People learn and change because they want to, not because they ought to, which means they need an inspiring vision of what the future can be.73

When she became CEO of HSN, Mindy Grossman found a business that was fun- damentally broken and employees who were beaten down and uninspired. She used physical symbols to provide a PEA that gave people hope and motivation. One day Grossman brought in Dumpsters to headquarters and told people to start throwing all the broken-down furniture and clutter away. Then, she had the buildings pres- sure washed and painted and bought everyone a new Herman Miller Aeron chair.74

• Make sure people have a support system. Leaders help people establish new, emotional relationships that provide hope, make people believe they have the power to change, and inspire people with the expectation that change will hap- pen. Effective leaders of social movements, for example, are highly skilled at giving people hope and faith that change is possible. This emotional relation- ship with a leader, a mentor, or a community helps people learn and practice the new skills and habits needed to change. This is what Alcoholics Anonymous or Weight Watchers meetings are all about, for example.

• Use repetition. People need the opportunity to experiment and practice the new skills and habits over and over until the new pattern of behavior becomes auto- matic. At Cedars-Sinai Medical Center, an epidemiologist used an experiment that showed doctors that their hands were covered with gobs of harmful bacte- ria. By showing one of the filthiest images as a screen saver on the hospital’s computer network, everyone on the staff was continually reminded of the importance of frequent hand washing. With repeated practice, hand-hygiene compliance eventually spiked to nearly 100 percent and stayed there.75

• Involve people early. When people are involved in helping to design the change, they will be more committed to it. Although this approach is time-consuming, it pays off by giving people a sense of control over the change activity. They come to understand the change better and become committed to its successful implemen- tation. Leaders at contracting and research firm Noblis wanted to do away with traditional job titles and replace the system with “career bands” that enable people to move sideways, not just up the hierarchy. The new system was part of a broader redefinition of jobs and responsibilities as Noblis shifted its strategy to a

NEW LEADER ACTION MEMO As a leader, you can understand the reasons for resistance to change and use tools such as a positive emotional attractor, supportive relationships, repe- tition, involvement, and after- action reviews to help people change.

482 PART 5 THE LEADER AS SOCIAL ARCHITECT

greater emphasis on competitive bid work. Leaders knew it could be a tough sell, so they had a group of employees spend six months studying the new plans and seeking feedback from people all around the company. “It was a fine-tooth comb with all our stakeholders, because we wanted to have a model that was built by Noblis for Noblis,” said Amy Rivera, a member of the HR team.76

• Apply after-action reviews. An excellent mechanism for evaluation and feedback of a change is the after-action review. After-action reviews are quick sessions dur- ing which leaders review the outcome of change activities to see what worked, what didn’t, and what can be learned from it. The concept of after-action reviews comes from the United States Army. After every identifiable activity—whether in field operations or training simulations—people take 15 minutes to ask four simple questions: What was supposed to happen? What actually happened? What accounts for the difference? What can we learn? Many businesses, including con- sulting firm Jump Associates, oil giant BP, and Steelcase, Inc., which makes office furniture, use after-action reviews for feedback and learning.77

Effectively and humanely leading change is one of the greatest challenges for leaders. The nature and pace of change in today’s environment can be exhilarating, but it can also be inconvenient, painful, and downright scary. Savvy leaders can help people navigate the change process and make it successful.

Now that you’ve read the chapter, check out how today’s leaders are applying these concepts. Log in to CengageNOW to follow the leaders on Twitter.

LEADERSHIP ESSENTIALS • The important point of this chapter is that tools and approaches are available

to help leaders facilitate creativity and change. The increased pace of change in today’s global environment has led to even greater problems for leaders strug- gling to help their organizations adapt. Many people have a natural resistance to change, but leaders can serve as role models to facilitate change. Leaders who can successfully accomplish change typically define themselves as change leaders, describe a vision for the future in vivid terms, and articulate values that promote change and adaptability. Change leaders are courageous, are capable of managing complexity and uncertainty, believe in followers’ capacity to assume responsibility for change, and learn from their own mistakes.

• Major changes can be particularly difficult to implement, but leaders can help to ensure a successful change effort by following the eight-stage model of planned change—light a fire for change; get the right people on board; develop a compel- ling vision and strategy; go overboard on communication; empower employees to act; generate short-term wins; keep up the energy and commitment to tackle bigger problems; and institutionalize the change in the organizational culture.

• An exciting approach to change management known as appreciative inquiry engages individuals, teams, or the entire organization in creating change by reinforcing posi- tive messages and focusing on learning from success. Rather than looking at a situa- tion from the viewpoint of what is wrong and who is to blame, AI takes a positive, affirming approach and follows the stages of discovery, dream, design, and destiny. AI is powerful for leading both major changes and smaller, everyday changes.

• Leading creativity for change and innovation is a significant challenge for today’s leaders. Leaders instill creative values in particular departments or the

Tw itt er

CHAPTER 15 LEADING CHANGE 483

entire organization by fostering a creative culture and promoting collaboration. Although some people demonstrate more creativity than others, research sug- gests that everyone has roughly equal creative potential. Leaders can increase individual creativity by facilitating brainstorming, promoting lateral thinking, enabling immersion, allowing pauses, and fostering creative intuition.

• Implementation is a critical aspect of any change initiative. Leaders should strive to understand why people resist a change. For something new to begin, something old has to end, and most people have a hard time letting go of some- thing they value. Leaders can help people change by changing emotions so that people can let go of the old and embrace the new. They can provide a positive emotional attractor, supportive relationships, repetition of new behaviors, par- ticipation and involvement, and after-action reviews.

DISCUSSION QUESTIONS 1. As a leader, how might you overcome your own felt resistance to a change from above

and act as a role model for implementing the change?

2. How are Kotter’s eight-stage framework for change and the AI method similar? How are they different? Explain.

3. Think of a problem situation you would like to change at work, school, or home and describe how you would provide a positive emotional attractor for this change.

4. How could you increase the number of novel and useful solutions you can come up with to solve a problem?

5. Of the five elements that help people change (positive emotional attractor, supportive rela- tionships, repetition of new behaviors, participation and involvement, and after-action reviews), which do you think leaders are most likely to overlook? Why?

6. How would you suggest a leader overcome resistance to a change that is going to cause some people to lose their jobs?

7. Why are idea champions important for a creative culture? Do you think these people would be more important in a large organization or a small one? Discuss.

8. Planned change is often considered ideal. Do you think unplanned change could be effective? Discuss. Can you think of an example?

9. Is the world really changing faster today, or do people just assume so?

10. Do you believe the Wall Street meltdown of 2008 will lead to any lasting changes in U.S. financial services institutions? What kinds of lasting changes do you envision? What about companies in other industries?

Complete this assignment online with CengageNOW.

C a C

LEADERSHIP AT WORK Organizational Change Role Play You are the new director of the Harpeth Gardens not-for-profit nursing home. Harpeth Gardens is one of 20 elder-care centers managed by Franklin Resident Care Centers. Harpeth Gardens has 56 patients and is completely responsible for their proper hygiene, nutrition, and daily recreation. Many of the patients can move about by themselves, but sev- eral require physical assistance for eating, dressing, and moving about the nursing home. During daytime hours, the head of nursing is in charge of the four certified nursing assistants (CNAs) who work on the floors. During the night shift, a registered nurse is on duty, along

484 PART 5 THE LEADER AS SOCIAL ARCHITECT

with three CNAs. The same number of CNAs are on duty over the weekend, and either the head of nursing or the registered nurse is on call.

Several other staff also report to you, including the heads of maintenance, bookkeeping/ MIS, and the cafeteria. The on-call physician stops by Harpeth Gardens once a week to check on the residents. You have 26 full- and part-time employees who cover the different tasks and shifts.

During your interviews for the director’s job, you became aware that the previous director ran a very tight ship, insisting that the best way to care for nursing home patients was by following strict rules and procedures. He personally approved almost every deci- sion, including decisions for patient care, despite not having a medical degree. Turnover has been rather high, and several beds are empty because of the time required to hire and train new staff. Other elder-care facilities in the area have a waiting list of people wanting to be admitted.

At Harpeth Gardens, the nonnursing offices have little interaction with nurses or each other. Back-office staff people seem to do their work and go home. Overall, Harpeth Gardens seems to you like a dreary place to work. People seem to have forgotten the com- passion that is essential for patients and each other working in a health-care environment. You believe that a new strategy and culture are needed to give more responsibility to employees, improve morale, reduce turnover, and fill the empty beds. You have read about concepts for leading organizational change and would like to implement some new ideas to make the culture at Harpeth Gardens more creative, decentralized, and participa- tive. You decide to start with the idea of engaging employees in decision making and encouraging more direct collaboration between departments. If those two ideas work, then you will implement other changes.

During your first week as the director, you have met all the employees, and you have confirmed your understanding of the previous director’s rigid approach. You call a meeting of all employees for next Friday afternoon.

Your assignment for this exercise is to decide how you will implement the desired changes and what you will tell employees at the employee meeting. Start by deciding how you will accomplish each of the first three steps in the model in Exhibit 15.2. Write your answers to these three questions:

How will you get employees to feel a sense of urgency?

How will you form a guiding coalition, and who will be in it?

What is your compelling vision?

Your next task is to prepare a vision speech to employees for the changes you are about to implement. In this speech, explain your dream for Harpeth Gardens and the urgency of this change. Explain exactly what you believe the changes will involve and why the employees

CHAPTER 15 LEADING CHANGE 485

should agree to the changes and help implement them. Sketch out the points you will include in your speech:

In Class: The instructor can divide the class into small groups to discuss the answers to the three questions above and to brainstorm the key points to cover in the vision speech to employees. After student groups have decided what the director will say, the instructor can ask for volunteers from a few groups to actually give the speech to employees that will start the Harpeth Gardens transition toward a more adaptive organization. The key questions are: Did the speech touch on the key points that inspire employees to help implement changes? Did the speech convey a high purpose and a sense of urgency? Did the speech connect with employ- ees in a personal way, and did it lay out the reality facing Harpeth Gardens?

Check out CengageNOW for additional cases with interactive activities.

C f i

LEADERSHIP DEVELOPMENT: CASES FOR ANALYSIS “From This Point On …” Bernini Foods is one of several companies offering healthy, frozen-packaged meals in the once-laughable and nutritionally challenged frozen dinner industry. Meeting the changing needs of modern, on-the-go, budget-conscious consumers, the new meals offered by Bernini face unprecedented competition from long-time industry leaders including Bertolli, Marie Callendar, Healthy Choice, Lean Cuisine, and others.

Cutthroat competition within the industry means every corporation must hustle for quality ingredients, improved packaging, efficiency in delivery systems, and decreased cook- ing times. Like its competitors, Bernini looks to increased market share through a combina- tion of price cuts and the introduction of new products.

To meet these challenges, CEO Roberto Bernini created a new management position to monitor pricing and purchasing. VP for Finance Ted McCann hired Lucian Wilkes, a retired army colonel, for the new position, giving him wide latitude for setting up new rules and procedures. With an announcement from CEO Bernini, Wilkes was introduced to the com- pany. Following an intense period of in-house research and information gathering, Wilkes zeroed in on what he saw as the major problems—the fragmentation of pricing and purchas- ing decisions, with managers in various regions devising their own standards and making their own contracts.

The process sent up red flags for Wilkes. He made an across-the-board e-mail announce- ment for new sustainability procedures, basically informing each regional office that “from this point on …” regional managers must inform his office of any price change above 3 percent. In addition, all local purchase contracts above $10 000 must also be approved by Wilkes’s office prior to implementation.

Directives for these new standardization procedures were issued to regional managers for their policy manuals. These managers, according to their immediate feedback, were all in agreement with the changes. But as one month followed another, Wilkes’s concern and level of frustration grew and a culture of business as usual appeared to continue. Managers did not resist. Frequent correspondence across the various regions including e-mails, faxes, and conference calls brought repeated assurances that change was coming.

“We just need time to make the changes,” one manager said. But weeks dragged on and the situation remained unaltered. Complicating the situation,

Wilkes appeared to have no vocal support from company executives, who were busy with their own concerns. While both Bernini and McCann offered lukewarm comments about the need for new initiatives to spur efficiency, neither demonstrated wholehearted support

486 PART 5 THE LEADER AS SOCIAL ARCHITECT

for the changes. The new plan was going nowhere, and Wilkes was aware that the failure of the company to increase profits could result in the loss of his own position.

“If nothing changes,” Wilkes complained to his wife, “the regional managers will remain on the job. My job will be cut.”

Wilkes wondered what his next move should be. In how many ways could he inform the managers to implement the new procedures? What pressures could he apply? How could he impress upon Bernini and McCann the importance of their support for the changes? He felt at a loss for what he should do. Did Bernini Foods want these new standards implemen- ted or not?

QUESTIONS

1. Why do you think the regions are not responding to Wilkes’s initiative for change? What did Wilkes do wrong with respect to implementing the change?

2. Should Wilkes solicit more active support from Bernini and McCann for the change he is attempting to implement? How might he do that?

3. Develop a plan that Wilkes can use to successfully restart the implementation of this change.

Riverside Pediatric Associates Five years ago, doctors Alvero Sanchez and Josh Hudson opened a small pediatrics office in Riverside, California. These longtime friends, who had graduated from medical school together, had finally achieved the dream of starting a pediatrics practice with the vision of providing excellent care to children in their local community. The five doctors, six nurses, and accountant who staffed the office quickly developed a reputation for being caring and conscientious. The staff also partnered with local organizations to serve the underprivileged in the community, providing free flu shots and health clinics at the local YMCA. Sanchez and Hudson were energized and ecstatic that they were living out their dream, managing their small practice in the midst of a community that respected them.

Their dream started to unravel, however, as the practice began growing at an unwieldy pace. The population of nearby Hispanic communities was burgeoning, and so was the num- ber of patients coming to Riverside. Although Sanchez and Hudson had always dreamed of a large, profitable practice, they realized they were not prepared for such unprecedented growth. The number of new patients was skyrocketing, and the staff at Riverside was unpre- pared to handle the influx. Waiting rooms were packed, the staff was becoming short tempered, and communication among staff was breaking down. Internal systems—like the electronic medical records systems—were overloaded, and patient health records were getting lost. Patient scheduling was chaotic, causing long waits for many people. The systems and procedures that once provided a firm underpinning for the small practice could no longer sustain the rapid patient growth.

Frustration mounted as the founding doctors spent more of their time managing the growing business and less time on patient care. They realized their original vision of provid- ing excellent pediatric care in a comforting environment was fading fast. Most importantly, they were growing dissatisfied with their work. Instead of diagnosing illnesses and building relationships with patients, they were spending more time overseeing expansion and growth of their practice: interviewing and hiring additional doctors and nurses; supervising construc- tion of the office expansion; and training new staff on office procedures. Their primary reason for opening a practice seemed like a long-forgotten memory.

Under the growing pressure, staff morale began to buckle. Heated arguments and short tempers among the staff were becoming commonplace. One stellar nurse had resigned, feel- ing powerless and disenfranchised by the conditions in the office. Another had been fired after arguing with a frazzled parent. Even Sanchez and Hudson were growing frustrated and unhappy in their work. Secluded for a quick lunch in the break room, Hudson confided in Sanchez. “There was a time,” he said, “when we found meaning in our work. I felt most

CHAPTER 15 LEADING CHANGE 487

alive and fulfilled when we were just starting out. Now, we’re just scrambling to keep pace with the change, but we’re falling behind and drifting away from what’s important—excellent care for our patients.”

Their lunch was interrupted by a knock at the door and some unexpected news from their accountant. The quarterly financial reports painted a grim picture, she told them. The recent pattern of decreasing revenue and escalating costs was continuing in this quarter. A financial crisis was beginning to brew, impacting both cash flow and profitability. The accountant explained that quick action would need to be taken to improve the practice’s financial health. “We have three problems,” she explained, “and those are declining reim- bursement from insurance companies, delinquent payments from patients, and rising costs of medical supplies and lab work.” She paused and then added, “It doesn’t help that our billing software is archaic. It simply can’t manage the size of this practice.”

Sanchez tore a page from his prescription pad, flipped it over, and scratched out the fol- lowing: To survive, Riverside Pediatric Associates must (1) improve service to patients and family; (2) improve respect and collaborative communication among the staff; (3) save money; (4) collect fees from patients in a timely manner; and (5) encourage innovation and creativity from our staff to solve routine problems. He slid this list across the table to Hudson, asking, “How do we make this happen?”

QUESTIONS

1. Assume you are Sanchez or Hudson and plan to implement immediate organizational change within the practice. Where would you start? What steps would you take?

2. The accountant recommended that Sanchez and Hudson consider using AI to facilitate positive change within the practice. How would you implement the four steps of AI? Be specific. What kinds of things would you expect to arise during the Discover and Dream steps of AI?

3. Sanchez and Hudson are caught between being physicians and being leaders of their practice. How do you suggest they resolve this dilemma? What leadership qualities will Sanchez and Hudson need to display in order to lead positive change in their practice?

Source: Based on Caroline Carter et al., “An Appreciative Inquiry Approach to Practice Improvement and Transformative Change in Health Care Settings,” Q Manage Health Care 16, no. 3 (© 2007 Wolters Kluwer Health; Lippincott Williams and Wilkins), pp. 194–204.

REFERENCES 1. Emily Glazer, Joann Lublin, and Dana Mattioli, “Penney Backfires on

Ackman,” The Wall Street Journal (April 10, 2013), http://online.wsj. com/article/SB10001424127887324504704578412440293890624. html (accessed June 11, 2013); Jena McGregor, “J.C. Penney’s Ron Johnson Shows the Perils of a Star CEO,” Washington Post (April 9, 2013), http://articles.washingtonpost.com/2013-04-09/national/ 38392404_1_ron-johnson-ceo-bob-nardelli (accessed June 11, 2013); Stephanie Clifford, “Chief’s Silicon Valley Stardom Quickly Clashed at J. C. Penney,” The New York Times (April 9, 2013), http://www.nytimes. com/2013/04/10/business/how-an-apple-star-lost-his-luster-at-penneys. html?pagewanted=all&_r=0 (accessed June 11, 2013); and James Surowiecki, “The Turnaround Trap,” The New Yorker (March 25, 2013), p. 44.

2. Reported in Surowiecki, “The Turnaround Trap.”

3. Steve Lohr, “How Crisis Shapes the Corporate Model,” The New York Times (March 29, 2009), p. BU4.

4. Based on John P. Kotter, The New Rules: How to Succeed in Today’s Post-Corporate World (New York: The Free Press, 1995); and David K. Carr, Kelvin J. Hard, and William J. Trahant, Managing the

Change Process: A Field Book for Change Agents, Consultants, Team Leaders, and Reengineering Managers (New York: McGraw-Hill, 1996).

5. The Conference Board, Change Management: An Overview of Current Initiatives (New York: The Conference Board, 1994); and studies reported in Rodrigue Fontaine, Gapur Oziev, and Hussein Hassan-Hussein, “Evaluating Chris Argyris’s Ideas: An Islamic Perspective,” Journal of Management Development 31, no. 10 (2012), pp. 1046–1057.

6. This is based on an interview with Justin O’Connell of Comalco, Exhibit 4.1, “Uniforms and Parking Space at Comalco,” in David K. Carr, Kelvin J. Hard, and William J. Trahant, Managing the Change Process (New York: McGraw-Hill, 1996), pp. 70–71.

7. Alain Vas, “Top Management Skills in a Context of Endemic Organizational Change: The Case of Belgacom,” Journal of General Management 27, no. 1 (Autumn 2001), pp. 71–89.

8. Naomi Schaefer Riley, “Seeing through the School Daze; Michelle Rhee Fired 241 Teachers, 36 Principals, and 22 Assistant Principals after Taking Over the District’s Schools,” The Wall Street Journal

488 PART 5 THE LEADER AS SOCIAL ARCHITECT

(February 19, 2013), p. A13; Michelle Rhee and Adrian Fenty, “Review—The Education Manifesto—Michelle Rhee and Adrian Fenty on What They Learned While Pushing to Reform D.C.’s Failing Public Schools,” The Wall Street Journal (October 30, 2010), p. C1; Jeff Chu, “The Iron Chancellor,” Fast Company (September 2008), pp. 112–143; Amanda Ripley, “Can She Save Our Schools?” Time (December 8, 2008), pp. 36–44; and William McGurn, “Giving Lousy Teachers the Boot; Michelle Rhee Does the Once Unthinkable in Washington,” The Wall Street Journal (July 27, 2010).

9. Jonathan Oosting, “StudentsFirst’s Michelle Rhee Returns to Michigan as Education Reform Group Makes Mark,” MLive (May 26, 2013), http:// www.mlive.com/politics/index.ssf/2013/05/studentsfirst_spotlight_ michel.html (accessed June 11, 2013).

10. The following discussion is based on John P. Kotter, Leading Change (Boston: Harvard Business School Press, 1996), pp. 20–25; John P. Kotter, “Leading Change: Why Transformation Efforts Fail,” Harvard Business Review (March–April 1995), pp. 59–67; John P. Kotter, “Accelerate!,” Harvard Business Review (November 2012), pp. 44–58; and Steven H. Appelbaum, Sally Habashy, Jean-Luc Malo, and Hisham Shafiq, “Back to the Future: Revisiting Kotter’s 1996 Change Model,” Journal of Management Development 31, no. 8 (2012), pp. 764–782.

11. Peter Löscher, “How I Did It … The CEO of Siemens on Using a Scandal to Drive Change,” Harvard Business Review (November 2012), pp. 39–42.

12. Ibid.

13. John Beeson, “On Leading Change: A Conversation with Bill Glavin of OppenheimerFunds, Inc.,” Business Horizons (2013), pp. 23–25.

14. Larry Hirschhorn, “Campaigning for Change,” Harvard Business Review (July 2002), pp. 98–104.

15. Christopher Lindquist, “Watch Carefully,” CIO (June 8, 2005), http://www.cio.com.au/article/181417/watch_carefully/ (accessed May 19, 2011).

16. David L. Cooperrider and Shuresh Srivastva, “Appreciative Inquiry in Organizational Life,” in R. Woodman and W. Pasmore, eds., Research in Organizational Change and Development, vol. 1 (Greenwich, CT: JAI Press, 1987); and D. Cooperrider and D. Whitney, Appreciative Inquiry: A Positive Revolution in Change (San Francisco, CA: Berrett-Koehler, 2005).

17. Quoted in Dave Kovaleski, “Appreciating Appreciative Inquiry,” Corporate Meetings & Incentives (August 2008), pp. 10–11.

18. This discussion draws from Sarah Lewis, Jonathan Passmore, and Stefan Cantore, “Using Appreciative Inquiry in Sales Team Develop- ment,” Industrial and Commercial Training 40, no. 4 (2008), pp. 175–180; Steven J. Skinner and Scott W. Kelley, “Transforming Sales Organizations through Appreciative Inquiry,” Psychology & Marketing 23, no 2 (February 2006), pp. 77–93; and Gabriella Giglio, Silvia Michalcova, and Chris Yates, “Instilling a Culture of Winning at American Express,” Organization Development Journal 25, no. 4 (Winter 2007), pp. 33–37.

19. See http://appreciativeinquiry.case.edu/practice/bibAiStories.cfm (accessed July 16, 2009) for examples of the uses of appreciative inquiry.

20. Example described in Mark Bechtold, “Improving Worker Morale through the Use of Appreciative Inquiry,” Industrial and Commercial Training 43, no. 1 (2011), pp. 25–30.

21. Debra Meyerson, Tempered Radicals: How People Use Difference to Inspire Change at Work (Boston: Harvard Business School Press, 2001).

22. William B. Locander and David L. Luechauer, “Leader as Inquirer: Change Your Approach to Inquiry,” Marketing Management (September–October 2007), pp. 46–49; Skinner and Kelley, “Trans- forming Sales Organizations through Appreciative Inquiry.”

23. Thomas J. Griffin, “In the Eye of the Beholder: Interview with Jim ‘Gus’ Gustafson,” Appreciative Leadership Interviews (The Taos Institute), http://www.taosinstitute.com/resources/gustafson.html (accessed July 16, 2009); and “Getting to Know … Gus Gustafson, CCL Donor and Alumnus,” Making a Difference: A Report on Activities and Impact from the Center for Creative Leadership (Greensboro, NC: Center for Creative Leadership, January 2009), http://www.ccl.org/leadership/pdf/news/newsletters/mad0109.pdf (accessed July 16, 2009).

24. Stanley S. Gryskiewicz, “Cashing In on Creativity at Work,” Psychology Today (September–October 2000), pp. 63–66.

25. Dorothy A. Leonard and Walter C. Swap, When Sparks Fly: Igniting Creativity in Groups (Boston: Harvard Business School Press, 1999), pp. 6–8.

26. Alan G. Robinson and Sam Stern, Corporate Creativity: How Innovation and Improvement Actually Happen (San Francisco: Berrett-Koehler, 1997).

27. Sherry Eng, “Hatching Schemes,” The Industry Standard (November 27–December 4, 2000), pp. 174–175.

28. Alan Deutschman, “The Fabric of Creativity,” Fast Company (December 2004), p. 54.

29. Robert D. Austin, Lee Devin, and Erin Sullivan, “Oops! Accidents Lead to Innovations. So, How Do You Create More Accidents?” The Wall Street Journal (July 7, 2008), p. R6.

30. Example cited in Phred Dvorak, “Businesses Take a Page from Design Firms; Sloan-Kettering Taps Industry for Innovative Ideas on Management,” The Wall Street Journal (November 10, 2008), p. B4.

31. Caneel K. Joyce, Kyle E. Jennings, Jonathan Hey, Jeffrey C. Grossman, and Thomas Kalil, “Getting Down to Business: Using Speedstorming to Initiate Creative Cross-Disciplinary Collaboration,” Creativity and Innovation Management 19, no. 1 (2010), pp. 57–67.

32. John Bessant, Kathrin Möslein, and Bettina Von Stamm, “Business Insight (A Special Report): In Search of Innovation,” The Wall Street Journal (June 22, 2009), p. R4.

33. Joyce et al., “Getting Down to Business: Using Speedstorming to Initiate Creative Cross-Disciplinary Collaboration.”

34. Jonah Lehrer, “How to Be Creative,” The Wall Street Journal (March 10, 2010), p. C1.

35. These tips are based on Leigh Thompson, “Improving the Creativity of Organizational Work Groups,” Academy of Management Execu- tive 17 (2003), pp. 96–109; Bruce Nussbaum, “The Power of Design,” BusinessWeek (May 17, 2004), pp. 86–94; and the ideas of Alex Osborn as described in Anya Kamenetz, “Building a Better Brainstorm,” Fast Company (February 2013), pp. 32–35.

36. David Kirkpatrick, “Throw It at the Wall and See if It Sticks,” Fortune (December 12, 2005), pp. 142–150.

37. Anya Kamenetz, “Building a Better Brainstorm,” Fast Company (February 2013), pp. 32–35; Kevin P. Coyne and Shawn T. Coyne, “Seven Steps to Better Brainstorming,” McKinsey Quarterly (March 2011).

38. Reena Jana, “Real Life Imitates Real World,” BusinessWeek (March 23–30, 2009), p. 42.

39. R. B. Gallupe, W. H. Cooper, M. L. Grise, and L. M. Bastianutti, “Blocking Electronic Brainstorms,” Journal of Applied Psychology 79 (1994), pp. 77–86; R. B. Gallupe and W. H. Cooper, “Brainstorming Electronically,” Sloan Management Review (Fall 1993), pp. 27–36; and Alison Stein Wellner, “A Perfect Brainstorm,” Inc. (October 2003), pp. 31–35.

40. Example described in Burt Helm, “Wal-Mart, Please Don’t Leave Me,” BusinessWeek (October 9, 2006), pp. 84–89.

41. Wellner, “A Perfect Brainstorm”; Gallupe and Cooper, “Brainstorming Electronically.”

CHAPTER 15 LEADING CHANGE 489

42. Edward DeBono, Serious Creativity: Using the Power of Lateral Thinking to Create New Ideas (New York: HarperBusiness, 1992).

43. Dave Waller, “The Gospel According to Edward DeBono,” Manage- ment Today (August 2007), http://www.managementtoday.co.uk (accessed July 27, 2009).

44. Francine Russo, “The Hidden Secrets of the Creative Mind,” Time (January 16, 2006), pp. 89–90.

45. Reported in Sue Shellenbarger, “Tactics to Spark Creativity,” The Wall Street Journal (April 2, 2013), http://online.wsj.com/article/ SB10001424127887323611604578398342398991844.html (accessed June 13, 2013).

46. Derm Barrett, The Paradox Process: Creative Business Solutions … Where You Least Expect to Find Them (New York: American Management Association, 1997).

47. This discussion is based on Drew Boyd and Jacob Goldenberg, “Think Inside the Box,” The Wall Street Journal (June 15–16, 2013), pp. C1, C2.

48. Quoted in Marla Capozzi, Renée Dye, and Amy Howe, “Sparking Creativity in Teams: An Executive’s Guide,” McKinsey Quarterly (April 2011).

49. Ronald T. Kadish, “Mix People Up,” Harvard Business Review (August 2002), pp. 39–49.

50. Shellenbarger, “Tactics to Spark Creativity”; David Rock, “Neuroscience Provides Fresh Insight into the ‘Aha’ Moment,” T D (February 2011), pp. 45–49; and Evangelina G. Chrysikou, “Your Creative Brain at Work,” Scientific American Mind (July–August 2012), pp. 24–31.

51. Quoted in Shellenbarger, “Tactics to Spark Creativity.”

52. R. Donald Gamache and Robert Lawrence Kuhn, The Creativity Infusion: How Managers Can Start and Sustain Creativity and Innovation (New York: Harper & Row, 1989); Alison Stein Wellner, “Cleaning Up,” Inc. (October 2003), p. 35; and Roger von Oech, A Kick in the Seat of the Pants (New York: Harper & Row, 1986).

53. Alison Stein Wellner, “Creative Control: Even Bosses Need Time to Dream,” Inc. (July 2007), pp. 40–42.

54. Richard A. Lovett, “Jog Your Brain,” Psychology Today (May/June 2006), pp. 55–56; and Mary Carmichael, “Stronger, Faster, Smarter,” Newsweek (March 26, 2007), pp. 38–46.

55. Rock, “Neuroscience Provides Fresh Insight into the ‘Aha’ Moment.”

56. This question comes from Lehrer, “How to Be Creative.”

57. This word challenge and the answers given for it later in the chapter are from Will Shortz, “RD Challenge,” Readers Digest (March 2004), p. 204; Lehrer, “How to Be Creative”; and Sarnoff A. Mednick, “The Associative Basis of the Creative Process,” Psychological Review 69, no. 3 (1962), pp. 220–232.

58. This question and the answer given later are from Tahl Raz, “How Would You Design Bill Gates’ Bathroom?” Inc. (May 2003), p. 35.

59. These match puzzles are from Michael Michalko, Thinkertoys, 2nd ed. (Berkeley, CA: Ten Speed Press, 2006).

60. Based on Paul Stebel, “Why Do Employees Resist Change?” Harvard Business Review (May–June 1996), pp. 86–92.

61. William Bridges, Transitions; Making Sense of Life’s Changes (Reading, MA: Addison-Wesley, 1980); and William Bridges, “Three Questions,” Leadership Excellence (February 2010), p. 11.

62. Bridges, “Three Questions.”

63. Joann S. Lublin, “Can a New Culture Fix Troubled Companies?” The Wall Street Journal (March 13, 2013), p. B1.

64. Todd Datz, “No Small Change,” CIO (February 15, 2004), pp. 66–72.

65. Katherine Hobson, “Getting Docs to Use PCs,” The New York Times (March 15, 2011).

66. Brian J. Hurn, “Management of Change in a Multinational Company,” Industrial and Commercial Training 44, no. 2 (2012), pp. 41–46.

67. Mark Chediak, “Utilities Try to Tame the Backlash against Smart Meters,” Bloomberg BusinessWeek (May 10, 2012), http://www .businessweek.com/articles/2012-05-10/utilities-try-to-tame-the-backlash- against-smart-meters (accessed June 13, 2013).

68. Michelle Manetti, “Incandescent Lightbulb Phase-Out Has People Hoarding High Watts,” The Huffington Post (October 18, 2012), http://www.huffingtonpost.com/2012/10/18/incandescent-lightbulb- phase-out-hoarders_n_1981215.html (accessed June 13, 2013).

69. Lindquist, “Watch Carefully.”

70. See studies reported in Alan Deutschman, “Change or Die,” Fast Company (May 1, 2005), http://www.fastcompany.com/magazine/ 94/open_change-or-die.html (accessed July 23, 2008); and Alan Deutschman, “The Three Keys to Change,” Fast Company (January 2, 2007), http://www.fastcompany.com/articles/2007/01/change- or-die.html (accessed July 23, 2008).

71. Story told in Deutschman, “Change or Die.”

72. The following is based in part on Richard E. Boyatzis, “How People Change: Create Positive Attractors,” Leadership Excellence (October 2010), p. 17; and Deutschman, “The Three Keys to Change.”

73. Boyatzis, “How People Change.”

74. Mindy Grossman, “HSN’s CEO on Fixing the Shopping Network’s Culture,” Harvard Business Review (December 2011), http://hbr.org/ 2011/12/hsns-ceo-on-fixing-the-shopping-networks-culture/ar/1 (accessed June 13, 2013).

75. Dan Heath and Chip Heath, “Passion Provokes Action,” Fast Company (February 2011), pp. 28, 30.

76. Sarah Halzack, “Noblis Does Away with Traditional Job Titles to Improve Career Development,” The Washington Post (March 10, 2013), http://articles.washingtonpost.com/2013-03-10/business/ 37605632_1_band-project-manager-staffer (accessed March 11, 2013).

77. Thomas E. Ricks, “Army Devises System to Decide What Does, Does Not, Work,” The Wall Street Journal (May 23, 1997); John O’Shea, “Army: The Leader as Learner-in-Chief,” The Officer (June 2003), p. 31; and Dan Heath and Chip Heath, “Made to Stick: Watch the Game Film,” Fast Company (June 1, 2010), http://www.fastcompany. com/1646990/made-stick-watch-game-film (accessed June 13, 2013).

490 PART 5 THE LEADER AS SOCIAL ARCHITECT

N A M E I N D E X

Adams, John Quincy, 105 Addams, Jane, 105 Addison, John, 102 Akerson, Dan, 427 Akhmechet, Slava, 239 Alfonso, Michael (case),

162 Allio, Robert J., 24 Alli, Shakrat, 348 Anderson, Max, 447 Andrews, Bill (case), 189 Ann, Doris (case), 253 Arrington, Michael, 50 Ashford, S. J., 434 Ashkenas, Ron, 436 Augustine, Norman R., 112 Autry, Gene, 12, 13 Avery, Gayle C., 398 Avolio, Bruce J., 143, 337,

362

Bair, Sheila, 379 Baker, Kent, 268 Baker, Wayne E., 262 Bale, Alexis, 352 Ballmer, Steven, 99 Ball, Molly, 336 Barela, Emiliana “Millie”

209 Barnes, Brenda, 103 Barra, Mary, 427, 428 Barsoux, Jean-Louis, 53, 107 Bartz, Carol, 4 Bass, Bernard M., 39, 77,

142, 143, 337, 362 Batiste, John, 212

Battley, Susan, 214 Baxter, Amy, 475, 476 Bean, L. L., 413 Becht, Bart, 330 Beers, Charlotte, 100 Belichick, Bill, 267 Benfari, Robert C., 210 Bennett, M., 345 Bernini, Roberto, 486, 487 Bertolon, Henry, 271 Bettinger, Walt, 158 Bewkes, Jeff, 359 Bezos, Jeff, 399, 404 Biden, Joe, 364 Bielby, William, 332 Blake, Frank, 415 Blake, Robert R., 49 Blanchard, Kenneth,

68–72, 70 Blount, Chris, 384, 385 Bock, Halley, 272 Bolman, Lee G., 375 Bosh, Chris, 292 Bossidy, Larry, 198 Bostrom, Robert P., 420 Boyatzis, Richard E., 150 Branson, Richard, 105,

362, 399 Brevig, Eric, 71 Bridges, William, 480 Briggs, William L., 246 Brin, Sergey, 429 Broderick, Ryan, 213 Brodhead, Richard, 281 Brody, Pauline Ning, 329 Brooks, David, 336, 399 Brotman, Jeffrey, 448 Brown, Aaron, 71 Brown, B. R., 341 Brown, Michael, 172

Brown, Tony, 295 Bryant, Paul, 393 Buckingham, Marcus, 247 Buffett, Warren, 42, 103,

106, 372 Burden, L., 69 Burger, J. M., 108 Burns, James McGregor, 4 Burns, Tony, 276 Burns, Ursula, 332, 333 Bush, George W., 204, 364 Bussard, Tony, 217

Cain, Susan, 106 Callaway, Sue, 372 Calmas, Wil, 271 Calonius, Eric, 399 Cameron, K., 240 Capparell, Stephanie, 67 Carmody, Aaron (case), 162 Carroll, Cynthia, 337 Carr, Tom (case), 161 Carver, Barry (case), 130 Caserio, Nick, 267 Cavanaugh, G. F., 381 Chambers, John, 277 Chambers, Robert, 6 Chenault, Kenneth, 332 Chislett, David, 210 Chisum, Marcus (case), 128 Christie, R., 368 Christopher, Irving, 195 Clark, Admiral Vernon,

111, 112, 403 Clark, Wesley, 370 Clawson, James G., 131,

398 Clawson, Victoria K., 420

Clinton, Bill, 273 Coffman, Curt, 247 Coleman, Frank, 421 Collins, Jim, 11, 13 Collins, Michael (case), 59 Conant, Douglas R., 50 Conger, Jay, 363 Conlin, Michelle, 336 Cook, Tim, 51, 65, 103 Cooperrider, David, 467 Copeland, Kenneth Corbat, Michael, 379 Covey, Stephen, 157 Coyne, William, 477 Craddock, John (case), 29 Crumbaugh, J., 401 Crutchfield, Kevin, 434 Curley, Tim, 171

Daft, Richard L., 143, 161, 236

Dahlen, Barbara Van, 6 Dale, Christine, 326 Dalgaard, Lars, 101 Danereau, Fred, 52 Das, Sanjiv, 449, 450 Deacon, David, 422 Deal, Terrence E., 375 de Blasio, Bill, 72 De la Vega, Juan Carlos

(case), 217–218 Denison, Daniel R., 442 Desai, Mira, 354 Devey, Rob, 247–248 Diaz, Guillermo Jr., 348 Dimon, Jamie, 237, 311 Dollar, Creflo, 4 Donald, Jim, 439

491 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Dooley, Ben, 317 Douglass, Frederick, 105 Dowdy, Joe D., 47, 48 Dragas, Helen, 364 Dumaine, Brian, 16 Dunn, Brian, 168 Dunnette, M. D., 312 Dutton, J. E., 434

Edwards, Douglas, 429 Efraty, David, 233 Elder, Morgan, 455 Embry, Tim, 449 Eskew, Michael L., 402 Evans, Bill, 353 Evans, Suzanne, 368, 369

Farley, Frank, 156 Farmer, Bill, 110 Feldhahn, Shaunti, 332 Ferrari, Bernard T., 268 Ferrazi, Keith, 309 Fetter, R., 143, 240, 362 Fiedler, Fred E., 67, 72, 74,

75, 77, 91 Finley, Bob (case), 94 Fitzgerald, Brad, 319 Fleishman, Edwin A, 47 Flexon, Bob, 441 Flick, Deborah L., 270 Foley, John, 298 Forbes, Malcolm, 338 Ford, Henry, 402 Forsythe, Charlotte (case),

252–253 Frankel, Roger, 287 Frank, Jan, 365 Franklin, Benjamin, 41 Fry, Louis W., 450

Gabarino, James, 337 Galvin, Bob, 266 Galvin, Paul, 266 Gandhi, 374 Gandz, Jeffrey, 442 Garcia, J. E., 93, 217 Gardner, Howard, 23, 175,

273

Gates, Bill, 106, 411 Gates, Robert, 370 Geis, F. L., 368 Gentry, Ethney (case), 352 George, Bill, 280 Gerard, Glenna, 270 Gerrit, Adam (case), 218,

219 Gerstner, Lou, 432 Ghosn, Carlos, 10 Gibson, Jane Whitney, 111 Gibson, Larry (case), 111 Giglio, Gabriella, 469 Gilson, Richard L., 201 Glavin, Bill, 466, 467 Goebel, James, 437 Goldberg, Michael, 279 Goldsmith, Marshall, 141 Goldsmith, Russell, 439 Goleman, Daniel, 150 Goltz, Jay, 77 Goodwin, Doris Kearns, 149 Gordon, Angela, 68, 70 Gough, Harrison G., 474 Graen, George B., 52 Graham, Jill W., 174 Graham, Lawrence Otis,

331 Grant, Adam, 178, 181 Grassley, Chuck, 4 Gray, Nicholas, 131 Green, Kyle, 440 Greenleaf, Robert, 178 Green, Tyler, 319 Greenwood, Regina A., 111 Griffin, Jack, 152 Grossman, Mindy, 482 Grove, Andrew, 399 Guber, Peter, 273 Gupta, Ankit, 154, 155 Gustafson, Jim, 470, 471 Gutman, Roberta, 326 Guttman, Howard M., 300

Hackman, J. Richard, 243 Hagans, Phil, 71 Hall, Kevan, 309 Hamel, Gary, 409 Handelsman, Mitchell M.,

246 Hannah, Sean T., 450 Hannum, Kelly M., 21

Hansen, Morten T., 11 Harbaugh, Jim, 152 Harbaugh, John, 152 Harris, Sue, 216, 217 Harris, Tracy, 247 Harter, Lynn M., 201 Hartman, Amir, 416 Hartnett, Jack, 45 Hartog, Deanne N. Den, 442 Hart, Russell (case), 189 Harvey, Jerry, 182 Hatala, Lewis J., 157 Heath, Chip, 471 Heath, Dan, 471 Heider, John, 79, 373 Heilbrun, A. B., 327 Henry, Carter (case), 252 Hernandez, Ignacio, 287 Herrmann, Ned, 117, 119 Hersey, Paul, 68–72, 70 Herzberg, Frederick, 231,

232 Heskett, James L., 433 Hevesi, Alan, 170 Hewlett, Sylvia Ann, 335,

349 Hewson, Marillyn A., 104 Hilberry, Jane, 279 Hildebrand, Carol, 161 Hitt, William D., 228, 395 Hoenig, Christopher, 172 Hofstede, Geert, 340, 341,

342 Holden, Daniel, 156 Hollandsworth, Dax (case),

254 Hood, Rachelle, 346, 347 Hooijberg, Robert, 442 Hsieh, Tony, 280 Hsi-Wei Chou, 37 Hsu, James, 386 Hudson, Josh, 487 Hughes, Chris, 106, 107 Hughes, Wayne (case), 128 Hurd, Mark, 168 Hurley, Chad, 273 Hurwitz, Mark, 196 Hurwitz, Samantha, 196

Iger, Robert, 38 Immelt, Jeffrey, 280, 370 Ireland, R. Duane, 327

Ivey, Mitch (case), 128 Ivey, Sandra (case), 161

Jackson, Bruce H., 229 Jacobson, Karl (case), 128 Jacobs, Paul, 404 Jagersma, Pieter Klass, 398 Jago, Arthur G., 67, 81–88 James, Erika H., 131 James, LeBron, 292 Jefferson, Thomas, 105 Jelinek, Craig, 447, 448 Jenkins, Anthony, 441 Jensen, M. A., 301 Jermier, John M., 90 Jobs, Steve, 65, 139, 363,

408 Johnson, Dewey, 70 Johnson, Earvin, 406, 407 Johnson, Robert Wood, 177 Johnson, Ron, 461 Johnston, Lynne (case), 94 Jones, Phil (case), 58 Jones, Sam, 354 Jordan, Phillip (case), 219 Jung, Carl, 120

Kador, John, 416 Kane, Robert, 47 Kantabutra, Sooksan, 398 Kanungo, Rabindra N.,

363 Kathman, Jerry, 477 Keiko, Lee (case), 130 Keleman, K. J., 93, 217 Keller, Fred, 177 Kelley, Robert E., 199 Kelly, Kevin, 116 Kelly, Terry, 338 Kennedy, Barbara (case), 128 Kennedy, John F., 404 Kent, Deborah, 338 Kerr, Steve, 293, 385, 436 Kerr, Steven, 90 Khemka, Ashok, 183 Kiel, Fred, 171 King, Martin Luther Jr., 399 Kington, Mark, 364 Kirton, Michael J., 414 Kluger, Jeffrey, 449

492 NAME INDEX

Komori, Shigetaka, 415 Koopman, Paul L., 442 Kothari, Akshay, 154, 155 Kotter, John P., 14, 16,

433, 465 Kouzes, James M., 38, 211 Kraft, Jonathan, 267 Kraft, Robert, 267 Kranz, Eugene, 281 Kullman, Ellen, 9, 333 Kupperbausch, C., 341

Lane, Flint, 431 Lane, Harry W., 287 Lanier, Cathy, 326 Lansing, Kurt, 319 Lash, Alex, 204 Lashinsky, Adam, 137 Lassiter, Amelia, 386 Laurent, André, 344 Lawrence, T. E., 273 Leahy, Terry, 13 Ledson, Bill, 353 Lee, Angela, 241 Lee, Dong-Jin, 233 Lee, Lucy, 386 Legere, John, 415 Lencioni, Patrick, 298 Lengel, R. M., 143 Lennick, Doug, 171 Leslie, Jean Brittain, 21 Levie, Aaron, 444 Lewin, Kurt, 44 Lewis, Cathy, 247–248 Lewis, C. S., 477 Lewis, John, 430 Liden, Robert C., 54 Lincoln, Abraham, 3, 364,

405 Lionel, Jane (case), 454 Lionel, Jim (case), 455 Livingston, Barry (case), 94 Loizos, Constance, 204 Löscher, Peter, 465, 466 Lovelace, K. J., 93, 217 Lublin, Nancy, 398 Luman, Champ, 352

Machiavelli, Niccolò, 365, 367, 368, 369

MacKenzie, S. B., 143, 240, 362

Macris, Achilles, 311 Madoff, Bernard, 39 Marchionne, Sergio, 74, 75 Marcic, Dorothy, 125, 342,

414 Marshall, Dawn, 202 Masarech, Mary Ann, 436 Maslow, Abraham, 230 Maslyn, John M., 54 Mason, Richard O., 443 Matheny, Sam (case), 94 Matsumoto, D., 341 Mattis, James, 47, 48 May, Douglas R., 201 Mayer, Marissa, 4, 40–41,

412, 413 McCamus, David, 144 McCann, Ted, 486, 487 McCanse, Anne Adams, 49 McCarthy, Kevin (case),

93–94 McClelland, David, 234,

235, 249 McDonald, Paul, 442 McDonald, Pete, 339 McDonnell, Stephen, 45,

46 McGinnis, Ross, 156 McGregor, Douglas, 112,

113 McIntyre, Glenn, 186 McKnight, Melvin R., 28 McNeill, John D., 269 McQueary, Mike, 171 Meloche, Thomas, 437 Metzcus, R., 69 Meyer, Barry, 360 Michaelson, Adam, 200 Michaels, Paul, 233–234 Michalcova, Silvia, 469 Milgram, Stanley, 182 Millar, Bart, 471 Miller, William, 414 Milosevic, Slobodan, 370 Minnick, Donald J., 327 Mishra, Aneil K., 442 Mitchell, S., 44 Mobert, D. J., 381 Moise, Gabriela, 261 Monroe, Lorraine, 394 Moore, Chuck, 286 Moore, Ethel (case), 161

Moorman, R. H., 143, 240, 362

Morgan, Philip, 268 Morrell, Margot, 67 Morrison, Denise, 50 Morrison, E. W., 434, 468 Morris, Pete (case), 252 Moskovitz, Dustin, 107 Mourkogiannis, Nikos, 409 Mouton, Jane S., 49 Mulally, Alan, 295 Mulcahy, Anne, 104 Murphy, Edward F. Jr., 111 Murray, Sue, 101 Myers, Betsy, 37 Myers, Isabel Briggs, 120 Myers, Rochelle, 285

Navarro, Angela, 195 Navarro, Mireya (case),

131 Nayar, Vineet, 9 Neill, Terry, 342 Newland, Ian, 156 Newstrom, John W., 47 Noel, Michael, 450 Nokelainen, Petri, 12, 449 Nolan, Sam (case),

160–161 Nooyi, Indra, 237, 333,

372

Obama, Barack, 4, 37, 107, 204, 364

Okun, Sherman K., 268 Oldham, G. R., 243 O’Leary, Richard, 328 Olson, Howard, 135 Oreg, Shaul, 464 Ornish, Dean, 481, 482 Ornstein, Jonathan, 148 Osborn, Alex, 476 Otis, Clarence, 326 O’Toole, Larry, 440

Page, Larry, 103, 429 Palmisano, Sam, 268 Parekh, Jateen, 404

Paris, Barry, 199, 200 Parker, Rachael (case), 252 Parry, John, 225 Patel, Hansa, 354 Patel, Leela (case), 353 Paulhus, D. L., 108 Peace, William, 184 Peck, Nan, 312 Penney, J. C., 461, 462 Peres, Shimon, 9 Petraeus, David, 4 Petrock, Frank, 442 Pfeffer, Jeffrey, 365, 367 Phelps, C. C., 434, 468 Phillips, Richard, 94 Phillips, Sally (case), 94 Piderit, S. K., 434 Pierce, Jon L., 47 Pinckney, Belinda, 347 Pincus, Mark, 435, 436 Pink, Daniel H., 242 Podsakoff, P. M., 143, 240,

362 Poe, Andrea C., 279 Posner, Barry Z., 38, 211 Powell, Colin, 365 Powell, Ken, 139 Preston, K., 341 Pulley, Mary Lynn, 279

Quinn, Robert E., 313, 442

Ramos, Denise, 169, 170 Ravens, Baltimore, 152 Rawls, Jim, 455 Ray, Michael, 285 Raymond, Lee, 104 Ready, Douglas A., 398 Reagan, Ronald, 112, 264 Reeves, Paul, 90 Reid, Paula, 181–182 Reiter, Mark, 141 Reynolds, Marcia, 197, 198 Rhee, Michelle, 464, 465 Riccitiello, John, 397, 398 Ricks, Thomas E. (case),

162 Riley, Doris Ann (case), 252 Riley, Pat, 273 Rivera, Amy, 483

NAME INDEX 493

Robbins, Alan, 78, 79 Roberto, Michael, 462 Roberts, Mark (case), 254 Robertson, Diana C., 447 Robinov, Jeff, 359 Rock, David, 477 Rockefeller, John D., 406 Roderick, Trish, 319 Rogers, Chris, 401 Rogers, William, 445 Rokeach, Milton, 109, 110 Rometty, Virginia, 35, 268 Rosenblum, Bruce, 359 Rosener, Judy B., 338 Rosenthal, Jeff, 436 Rosin, Hanna, 336 Rost, Joseph C., 16 Rothbard, N. P., 434 Rothkopf, David, 4 Rowe, Alan J., 443 Rowe, John W., 181 Rufer, Chris, 291, 292 Ruiz, Vicente, 286

Saban, Nick, 393, 396 Sadik-Khan, Janette, 72 Saginaw, Paul, 406 Samuels, Ben (case), 58 Sanchez, Alvero, 487, 488 Sandberg, Sheryl, 55, 71,

333, 334, 372 Santosus, Megan, 161 Schein, Edgar, 270 Schiavone, Jennifer, 169 Schlain, Kent, 384 Schloss, Steve, 309 Schmidt, Warren, 45 Schramm, Wilbur, 261 Schultz, Howard, 3 Seligman, Brad, 325 Seligman, Martin, 151 Sellers, Patricia, 372 Seltzer, Joe, 414 Senge, Peter M., 144, 145

Sergiovanni, T. J., 69 Shaich, Ron, 413 Sharer, Kevin, 268, 269 Sheridan, Richard, 437 Shih, Clara, 55 Shoemate, C. R., 340 Siegel, Laurie, 209 Siegel, Phillip, 233 Sifonis, John, 416 Simms, Robert, 437 Sinegal, Jim, 447, 448 Sinofsky, Steven, 99 Sirgy, M. Joseph, 233 Slocum, Robert S., 266 Smith, Charles M., 184, 185 Snavely, William B., 269 Snyder, Daniel, 88 Sobol, Mark R., 266 Sri Dhammananda, K., 264 Steers, Richard M., 236 Stein, Laurie, 210 Stephens, Doug, 448 Stewart, Potter, 4 Stogdill, R. M., 36, 37 Strauss-Kahn, Dominique,

104 Stringer, Casey, 317 Stroup, John, 206 Suarez, Carmelita (a case),

384, 385 Sullenberger, Chesley B.

“Sully” 37 Sullivan, Mark, 182 Sullivan, Nora, 246 Sullivan, Paul (case), 162 Sullivan, Teresa, 364 Sutton, Robert I., 101, 207 Swidarski, Thomas, 280 Szadokierski, Cindy, 338,

339

Taber, Tom, 68, 70 Talley, Pat (case), 384, 385 Tannenbaum, Robert, 45

Tao Te Ching, 44 Taurel, Sidney, 440 Tedlow, Richard, 169 Terrill, John (case), 28, 29 Teurfs, Linda, 270 Thiederman, Sondra, 340 Thomas, Kenneth, 312 Thompson, Scott, 168 Tillerson, Rex, 104 Tirri, Kirsi, 12, 449 Towler, Annette, 246 Townsend, Robert, 137 Treasurer, Bill, 186 Treviño, L. K., 172 Truelove, Emily, 398 Truman, Harry, 380 Tsujihara, Kevin, 359, 360 Tuckman, Bruce W., 301 Turner, Ted, 411 Tyler, John, 455, 456

Ubani, Martin, 449 Uhl-Bien, Mary, 52 Ullman, Myron III., 138,

461 Ulrich, Dave, 436 Unger, Frank, 287

Valasques, M., 381 VanMuijen, Jaap J., 442 Van Vranken, Matt, 378 Vig Knudstorp, Jørgen, 435 Voyer, Peter, 180 Vroom, V. H., 81–88, 238

Wade, Dwyane, 292 Wall, Bob, 266 Wallington, Patricia, 107,

172 Walsh, Adrienne, 319

Walters, Caroline, 348 Walumbwa, Fred O., 450 Watkins, Jamie, 353 Weed, William Speed, 204 Weinstein, Art, 8, 86, 87 Weinzweig, Ari, 406 Weisinger, Hendrie, 153 Weiss, Bill, 303 Weissman, M. D., 341 Welch, Jack, 101, 271, 411,

437, 441 Wessel, David, 336 Whitall, Jan, 219 Wilkes, Lucian, 486, 487 Willett, Curtis, 455 Williams, Rick, 102 Williams, Roy, 375 Willingham-Hinton,

Shelley, 330 Wilson, Ken, 348 Wojohowski, Max (case),

94 Wolfel, Don, 339 Wolfowitz, Paul, 379, 380 Woodford, Michael,

184–185

Yalom, Irvin D., 197 Yates, Chris, 469 Yemen, Gerry, 131 Yi Zhang, 21 Yost, Dave, 441 Yousafzai, Malala, 167,

168, 181 Yukl, Gary, 51, 53, 68, 70 Yusuf, Zia, 365

Zauderer, Donald G., 170 Zuckerberg, Mark, 107, 412 Zuckerman, Marilyn R.,

157 Zugheri, David, 274

494 NAME INDEX

I N D E X O F O R G A N I Z A T I O N S

Abercrombie & Fitch, 332 Access Designs, 186 ACM Partners, 138 Adobe Systems, 472 Aetna, 181 Aflac, 242, 408 Agency for Healthcare

Research and Quality, 298

AIG, 168 AlliedSignal, 198 Alfred A. Knopf, 334 Alpha Natural Resources

Inc., 434 Alvis Corporation (case), 93 A&M, 353 AMA Enterprise, 260 Amazon, 399, 404 American Express, 332,

349, 468, 469 American LubeFast, 449 American Management

Association, 471 AmerisourceBergen, 441 Ameritech, 303 Amgen Inc., 11, 268 Amtech Electronics (case),

455–456 Anheuser Busch InBev,

445 Apple, 51, 65, 103, 138,

139, 154, 363, 408, 409, 428, 461

Applegate Farms, 45, 46 Arup Group, 473 Aspen Institute, 437 AT&T, 234, 349 Autodesk, 4

Averitt Express, 440 Avis Rent-a-Car, 137

BAE Systems, 374 Bain & Company, 335 Baltimore Ravens, 152 Bank of America, 303 Barclays PLC, 441 Bear Stearns, 168, 428, 433 Belden Inc., 206 Benedictine University,

470 Berkshire Hathaway, 42,

103 Bestfoods, 340 Better Horizons and Possi-

bilities Consulting, 347 BHP Copper Metals, 241,

242 Billtrust, 431 BlackBerry, 139, 319, 428 BlackRock, 348, 349 Blue Bell Creameries, 294 BMW, 319 Boeing, 472, 475 Booz Allen Hamilton, 437 Boston Children’s Hospital,

298 Boston Consulting Group,

335 Box, 444 BP, 342 British Army, 440 British Broadcasting Cor-

poration (BBC), 4, 167 British retailer Selfridges,

78 British Telecom (BT), 348

Campbell Soup Company, 50, 291

Canon, 399 Cascade Engineering, 177 Cedars-Sinai Medical

Center, 482 Center for Creative

Leadership, 21 Central City Museum

(case), 420–421 Central Intelligence

Agency (CIA), 4, 121, 329

Century Medical (case), 160

Charles Schwab, 158, 294

Chisum Industries (case), 128

Chrysler Group LLC, 74, 75

Cirque du Soleil, 294 Cisco Systems, 277, 348 Citigroup, 349, 379 CitiMortgage, 449, 450 City National Bank, 439 Clorox Company, 210 Coca-Cola, 332, 399 Colgate-Palmolive, 329 Columbia Business School,

446–447 Consolidated Products

(case), 58 Container Store, 448 Converge, 271 Cornell University, 337 Costco, 447–448 Countrywide, 168, 200

Credit Suisse, 349 Creighton Auto Parts

(case), 59 Crown Prosecution

Service, 348

Dannon Milk Products, 410

Danone, 410 Darden Restaurants, 326 Deloitte, 349 Denny’s Restaurants, 346 Devereaux-Dering Group

(case), 319–320 DGL International (case), 28 Diebold, 280 D. L. Rogers Corporation,

45 Dollar General, 410 Duke University, 281, 471 DuPont, 9, 333, 401 Dynergy, 441, 480

eBay, 332 Electronic Arts (EA), 397,

398 Eli Lilly and Company, 440 Emerald Packaging, 116 Environmental Designs

International (EDI) (case), 130

Environmental Protection Agency (EPA), 121

Exert Systems (case), 94 Extended Stay America, 439 ExxonMobil, 104, 428

495 Copyright 2015 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part. Due to electronic rights, some third party content may be suppressed from the eBook and/or eChapter(s).

Facebook, 55, 71, 106, 107, 292, 334

Family Dollar, 413 FAVI, 198 Federal Deposit Insurance

Corporation (FDIC), 379

FedEx Express, 89, 332 Fierce Inc., 272 5 Star Electronics (case),

455–456 Ford Motor Company,

295, 338, 402 Fortune Magazine, 372 Fox Sports, 330 French Grains Bakery, 92 Fujifilm, 416

Gallup Organization, 227, 247, 407

Genentech, 349 General Electric (GE), 101,

117, 271, 280, 370, 400, 411, 437, 441

General Mills, 139 General Motors (GM), 75,

295, 332, 427, 428 Gentle Giant, 440 Geographic Combatant

Command (GCC), 265 George Foundation, 101 Gerdau Ameristeel, 274 German Volksbanken

Raiffeisenbanken Group, 402

Giant Leap Consulting, 186 Global Integration, 309 Google, 4, 22–23, 40, 103,

137, 138, 292, 400, 409, 428, 429, 440

Gore-Tex, 472 Governance Metrics Inter-

national, 173 Greater Chicago Food

Depository, 399, 400 GSD&M, 475

Hallmark Cards, 121 Harmon Auto Parts, 90

Harvard Business School, 169, 446–447

Harvard Center for Public Leadership, 37

Harvard Medical School, 143

Harvard University, 173, 440

Hay Group, 41, 42, 43 HCL Technologies, 9 Heinz, 291 Hewlett-Packard, 168 Hilcorp Energy, 245 Hi-Tech Aerostructures

(case), 422–423 Hollywood Studios, 139 Home Depot, 415 Home Entertainment

Group, 359 Honda, 295 HSN, 482 Hunter-Worth, 286 Hyperlink Systems, 216

IBM, 35, 71, 216, 274, 280, 294, 308, 340, 432, 439, 475

Imperial Oil, 210 Industrial Light and Magic

(ILM), 71 Intel, 11, 399 International Monetary

Fund, 104 ITT, 169, 170

Jackson State University’s Learning Center, 110

JBS Swift & Company, 339 J.C. Penney, 462 John Foley, Inc., 298 Johnson & Johnson, 177,

300 JPMorgan Chase, 237, 311

KBR, 185 King Conductors (case),

252 Kodak, 428

LEGO Group, 435 Lehman Brothers, 168 LivePerson Inc., 309 L.L. Bean, 413 L’Oreal, 300 Lorraine Monroe Leader-

ship Institute, 394 LPK, 477

M16, 429 Magic Johnson Enterprises,

407 Manchester Bidwell, 234 Mandalay Entertainment

Group, 273 Mars Drinks, 300 Mars Incorporated, 232,

233–234 Massachusetts General

Hospital, 296 Massey Energy Company,

434 Mayo Clinic, 294 McDonald’s, 71 McKinsey & Company,

333, 335, 435 Medtronic, 280 Menlo Innovations, 437 Merck, 89 Mesa Airlines, 148 MetLife, 334–335 Microsoft, 99, 411 Mitsubishi, 332 Mobil Corporation, 308 Mohawk Industries, 230 Monsanto, 89 More Than Wheels, 6 Morgan Stanley, 349 Morning Star, 291 Motion Pictures Group, 359 Motorola, 14, 266, 326, 408 MyBarackObama.com, 107

Nabisco, 50 NASA, 281, 404 National Black Crown

Prosecution Association, 348

National Bureau of Economic Research, 332

National Football League (NFL), 152

National Organization for Diversity, 330

NATO, 370 NECX, 271 The Nerdery, 243 Nestlé, 475 NeuroLeadership Institute,

477 New York City

Economic Development Corporation, 117

NFL Super Bowl, 152 Nissan, 10 Nokia, 216, 475 Nordstrom, 440, 448 Northern Arizona

University, 28 Novartis, 300

Ogilvy & Mather Worldwide, 100

Olympus, 184 OPEC oil embargo, 19 OppenheimerFunds, Inc.,

466

Pacific Edge Software, 445 Panera Bread, 413 Pathmark, 202 PepsiCo, 237, 333 Pfizer, 481 Plastic Lumber Company, 78 Preventative Medicine

Research Institute, 481 Primerica Inc., 102 Princeton University, 7 Progressive Insurance, 11 Prudential UK and Europe

(Pru UK), 247–248 Pulse News, 155

Qualcomm, 404 Quality Suites, 186

496 INDEX OF ORGANIZATIONS

Ralcorp, 244 The Red Team, 470 Renaissance Ramada, 186 Rensselaer Polytechnic

Institute, 148 Research in Motion, 428 RethinkDB, 239 Ryder Systems, 276

Samsung, 139, 409 San Francisco 49ers, 152 SAP, 101 Sara Lee, 103 SAS Institute, 445 Serena Software, 445 ServiceMaster, 179 Shell Oil, 342 Siemens, 465, 466 Skype, 309 Smart Balance, 307 Solix Inc., 225 Sonic, 45 Southwest Airlines, 11,

428, 440 Spectrum Health Hospital

Group, 378 Spring Company, 302 Standard Chartered Bank,

398 Standard & Poor’s, 168 Stanford Graduate School

of Business, 104 Stanford University, 366,

471 Starbucks, 3, 317 Streetline Inc., 366 StudentsFirst, 464

SuccessFactors, 101 SunDax (case), 254 The Sunday Times, 177 SuperShuttle, 481

Tasty Catering, 294 Teach for America, 6 TeamBank, 410, 439 TechCrunch, 50 Tesco, 13 Texaco, 332 3M, 477 Time Inc., 152 T-Mobile, 415 Tokyo Electric Power

Company, 8 Toyama Chemical

Company, 416 Toyota, 281, 295 Transocean, 259 Tyco International, 209

UKRD, 445 Unilever PLC, 342 Union Bank of California,

274 United Airlines, 338–339 United States Africa Com-

mand (USAFRICOM), 264, 265

University of Alabama, 393, 396

University of California, 481

University of Chicago, 75 University of Iowa, 44,

University of Michigan, 48–49, 50

University of Pennsylvania, 151, 178

University of Texas, 49, 50 University of Virginia, 364 UPS, 402, 472 U.S. Air Force, 146, 297 U.S. Army, 135, 209 U.S. Chief of Naval Opera-

tions (CNO), 111 U.S. Department of

Defense, 298 U.S. Justice Department,

168 U.S. Marine Corps, 46, 47 U.S. Office of Personnel

Management, 435 U.S. Secret Service, 181 USS Florida (case),

161–162 U.S. workforce, 328

Verizon Communications, 413

Virgin Group, 105, 362

Waite Pharmaceuticals (case), 386

Walmart, 237, 294, 332, 408

Walt Disney Company’s Motion Pictures Group, 140

Warner Brothers, 359 Washington, D.C., Metro-

politan Police, 326

Washington, D.C., Public School System, 464–465

Washington Redskins, 88–89

Wet Seal, 325 Wharton School of the

University of Pennsyl- vania, 446–447

Whitlock Manufacturing, 86–87

Whole Foods Market, 448

W. L. Gore & Associates, 338

World Bank, 379–380 Wyckoff Heights Medical

Center, 168

Xerox, 104, 144, 332

Yahoo, 4, 40, 168, 412, 413, 472

Yale School of Management, 446–447

Young Women for Change, 185

YouTube, 237

Zappos, 280, 429, 440, 446

Zenith, 408 Zingerman’s Community of

Businesses, 406 Zynga, 435, 436

INDEX OF ORGANIZATIONS 497

S U B J E C T I N D E X

Abilene Paradox, 182 ability, 38 acceptance, 345 accommodating style, 312 accountability, 298 achieve alignment, 397 achievement culture, 442,

444–445 achievement needs, 234 achievement-oriented

leadership, 78 acquired needs theory,

234–235 action courage, 184 moral leadership, 172–173 strategic, 394 vision, 394–396

active behavior, 199 adaptability, 151 adaptability culture, 444 adaptation, 345, 431–432 adaptive cultures, 440 adjourning stage (team

development), 301–302 advisory role, 43 advocates, 365, 366, 374 affiliation needs, 234 after-action reviews, 483 agent, change, 463–465 agile leader, 20 agreeableness, 103 agreement, 218 alienated followers, 199 allies, development of, 377,

378–379 allow pauses, 477 altruism, 409, 410

ambiguity, 76 anger, 147, 186 anticipate threats and

opportunities, 397 appreciative inquiry (AI),

467–471 articulation, 363 charismatic leadership and, 363

art, of leadership, 23–24 assertiveness, 312–313,

377–380 assumptions, 138 attitudes, 109–113 diversity, 328–329 followers, 198 and social perception, 113–116

attraction, 302 attribution theory, 113–116 authoritarianism, 108 authoritarian leaders, 178 authoritarian management,

176 authority, 15, 44–46 authority-compliance

management, 49 autocratic leadership, 45 avoidance learning, 236,

237 avoiding style, 312

barriers, breaking down, 366

beginner’s mind, 142, 143, 144

behavior modification, 236 behaviors, 44

active versus passive, 199 charismatic leadership and, 363

managing versus coaching, 212

motivation and, 226 task versus relationship, 92–93

See also leader behavior behavior theories, 17,

43–52 autocratic versus democratic leadership, 44–46

“high-high” leader theories, 50–52

Leadership Grid, 49–50 Ohio State studies, 46–48 University of Michigan studies, 48–49

beliefs, 177 belongingness needs, 230 bias, passive, 331 Big Five personality

dimensions, 102, 103 big-picture thinking, 396 blind spots, 101 boss-centered leadership,

45 Boston magazine, 440 brain dominance, 116–120 brainstorming, 474–475 brainwriting, 475 bureaucratic culture, 427

calmness, 281 candor, 271–272 caring, 185

carrot-and-stick approach, 235

cases. See leadership development cases

causality, circles of, 145 ceremonies, 438–439 challenge, courage to,

209–210 change, 5, 7–9, 112, 151,

460–462 appreciative inquiry, 467–471

creativity for, 471–479 framework for, 465–467 implementation of, 479–483

leadership development cases, 486–488

leadership essentials, 483–484

necessity of, 462–463 organizational culture and, 428

role play, 484–486 vision and, 404

change agent, 463–465 change leader, 468 change, people, 480–483 channel, definition of, 275 channel richness, 275–277 character development, 112 charisma, 361, 362 charismatic leaders, 361 charismatic leadership, 18,

361–363 The Chronicles of Narnia

(Lewis), 477 clarification. See path

clarification clarity, 212

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clear objectives, 298 coaching, 212, 213, 214,

299 coaching style, 69–70 coalitional leadership,

363–366 coercive power, 371 cognitive differences,

116–122 cognitive style, 116–122 cohesiveness. See team

cohesiveness collaborating style, 313 collaboration, 10

followers and, 198 collaborative role, 43 collectivism, 341, 342 comfort zone, pushing

beyond, 182 command teams, 294 commitment, 298,

374, 400 communication, 258–260

communication champion, 262–264

crises, 280–282 definition of, 260 leadership and, 260–264 leadership development

cases, 285–287 leadership essentials, 282 listening, 267–269,

283–285 management, 262 nonverbal, 278–280 persuasion and influence,

274–275 strategic conversations,

264–273 communication apprehen-

sion, 275 communication champion,

262–264 communication channels,

260–261, 275–278 communication climate,

265–266 compelling purpose, 298 competition, 10, 303 complexity, 144 compliance, 373 compromising style, 312 conflict, 309–310

causes of, 311

and cooperation, balancing, 310–311

styles to handle, 311–314 types of, 310

conflict management, 309–315

conformists, 199, 200 conscientiousness, 103,

104, 151 consensus, 130, 300 consideration, 46 consistency, 100, 105 consistency culture, 445 consultations

group, 81 individual, 81

contingency, 66 contingency approaches,

65–95 Fiedler’s model, 74, 76 leadership development

cases, 93–95 leadership essentials, 91 leadership substitutes,

89–91 path–goal theory, 76–81 situational theory, 69–72 task versus relationship

role play, 92–93 Vroom–Jago model,

81–88 contingency theories, 17–18 continuous reinforcement,

237 control, 9, 176 conventional level, 174 conventional teams, 307 conversations. See strategic

conversations cooperation, 310–311 core competence, 413 core purpose, 407 core values, 407 core work teams, 177 corporate culture, 430,

442. See also organizational culture

Corporate Culture and Performance (Kotter and Heskett), 435

corporate entrepreneurship, 472

country club management, 49

courage to assume responsibility,

209 to challenge, 209–210 definition of, 180 followers and, 208–211 to leave, 210–211 to participate in

transformation, 210 personal, 184, 185–187 to serve, 210 See also leadership

courage Courage Goes to Work

(Treasurer), 186 Cowboy Code, 13 creative culture, 472 creative intuition,

477–479 creative people, 473–479 creative personality, 474 creative values, 472–473 creativity, 472

creative people, leading, 473–479

values, 472–473 credibility, 274 crises, communication in,

280–282 critical thinking, 199 cross-departmental teams,

294–295 cross-functional teams,

294–295 cross-silo cooperation, 366 cultural intelligence (CQ),

343 cultural leader, 438 cultural leadership,

438–441 culture clash, 454–455 culture, definition of,

428–430. See also organizational culture

culture gap, 434 culture of agility, 17 culture of efficiency, 17 culture of integrity, 26 culture preference

inventory, 443 culture strength, 433 customers

coalitional leadership and, 365

decision-making and power, 177

mission and, 409

daily actions, 441 deception, 157 decision authority, 299 decision making, 83, 84,

170, 172, 173, 177, 415–417

decision styles. See leader decision styles

decoding, 261 defense, 345 delegating style, 68 delegation, 81 deliberate practice, 196,

211 democratic leadership,

44–46 dependent thinking. See

uncritical thinking derailment, 21 design, 469 desire, 182 destiny, 469 development-based model,

83, 85 diagnostic questions, 81–83 dialogue, 269–271 differences, minimization

of, 345 direction

clarity of, 212 provision of, 14

directive leadership, 78 discovery, 409, 468, 469 discrimination, 331–332 discussion, 199, 270–271 disgust, 147 dissatisfaction, 231–232 distinctiveness, 129 distributive negotiation,

314 diversity, 10–11

advancement of women and minorities, 347–349

attitudes toward, 328–329

contemporary, 327–330 definition of, 327–328

500 SUBJECT INDEX

global, 339–345 inclusiveness, 345–347 leadership development

cases, 352–354 leadership essentials,

349–350 minority challenges,

330–335 organizational diversity,

value of, 329–330 personal, 351 virtual teams, 308 women, 336–339

diversity awareness, 345–347

diversity networks, 348 diversity of skills, 298 domain of strategic

leadership, 396 dominance, 116–120 dominating style, 312 dreamers, 395 dreaming, 468–469 dress appropriately, 428 drive, 40–41 Drive: The Surprising Truth

About What Motivates Us (Pink), 242

dyads, 52. See also vertical dyad linkage (VDL) model

dysfunctional teams, 297

effective followers, 199, 200

effective leader, 369 effective listening, 267–268 effective strategy,

development, 411–413 efficiency, 17 eight-stage model, organi-

zational change, 466 electronic brainstorming,

475 electronic communication

channels, 277–278 electronic messaging, 276 e-mail, 279 embeddedness, 263 emotional commitments,

402 emotional contagion, 148

emotional intelligence, 146–152

emotionally competent leaders, 152

emotional management, 146

components of, 149–150 and earning power, 148 leaders, 163

emotional stability, 103, 104 empathy, 150, 151 employee affinity groups,

348 employee-centered leaders,

48 employee resource groups,

348 empowerment, 13, 19, 20,

44, 176, 241, 466–467 applications, 244–245 job design for, 242–244 psychological model of,

241–242 encoding, 260–261 The End of Men (Rosin),

336–337 end values, 109–112 engagement, 245–248 enjoyment, 147 entrepreneurial leadership,

56 entrepreneurship, 55 entrusting style, 70 envy, 147 equality, 438 equity theory, 239–240 esteem needs, 230 ethical action, guidelines

for, 381 ethical and unethical

behavior, 168 ethical behavior, of leaders,

172, 175 ethical climate, in U.S.

business, 169–170 ethical leadership, 40 ethical maturity, 171 ethical values, 112,

446–447 ethics

definition of, 446 leadership power and,

380–381 ethnocentrism, 330

everyday change, apprecia- tive inquiry, 470–471

excellence, 409–410 exchange, 52. See also

leader–member exchange

executive coaching, 23 executive derailment, 23 expectancy theory,

238–239, 240 experience, openness to. See

openness to experience expert power, 371–372 explicit metrics, 298 external adaptation,

431–432 external attribution, 115 external focus, 442 external locus of control, 106 extinction, 237 extrinsic rewards, 227–228 extroversion, 130

facilitation, 81, 82 fast track, 22 fear, 147, 153–158, 180,

181, 203 fear of conflict, 298 feedback, 213–214, 261,

316–317 feelings, 120, 150 femininity, 341, 342 Fiedler’s contingency

model, 72–76 Fifth Discipline, The

(Senge), 144, 145 First Break All the Rules

(Buckingham and Coffman), 247

flexibility, 442 focus, internal and external,

442 follower-centered question-

ing, 267 follower readiness, 70–72 followers

alignment of, 15 annoying, 204 demands on, 211 desirable, 211 leadership power and,

373–374

leadership substitutes and, 88–91

needs of, 56 path–goal theory, 76–81 transformational

leadership and, 361 followership

art of, 196–198 leaders and, 198,

211–215 leadership development

cases, 217–220 leadership essentials,

215–216 management of leaders

by, 196–197, 203–204 power of, 201, 208–211 role play, 216–217 styles of, 199–202

The Foreclosure of America, 200

forming stage (team devel- opment), 299–300

frame, 375 frames of reference, 374–377 freedom, 46 free riders, 296–297 frustration, 186 functional teams, 294 fundamental attribution

error, 115 future thinking, 418–420

Gallup Management Journal, 149

gender issues, 336–339 glass ceiling, 332–335 global diversity, 339–345 global mindset, 139 global teams, 307 goal consensus, 274 goals, 302

charismatic leadership and, 363

Good Boss, Bad Boss (Sutton), 207

Good to Great (Collins), 11, 13

Great Business Teams: Cracking the Code for Standout Performance (Guttman), 300

SUBJECT INDEX 501

Great by Choice (Collins and Hansen)

Great Man theories, 17, 36 group consultation, 81 groupthink, 303 growth and development,

of followers, 198, 213 guilt, 147

halo effect, 114 Handbook of Leadership

(Bass and Stogdill), 38 handshaking, cultural styles

of, 339, 340 hard power, 369–374 heroism, 11, 409, 411 Herrmann Brain Domi-

nance Instrument (HBDI), 117

hierarchy of needs theory, 230–231

higher needs, 227 higher purpose, 185 high follower readiness

level, 70 “high-high” leader theories,

50–52 high-performance culture,

435–437 high task–high relationship

leader styles, 68 high task–low relationship

leader styles, 68 honesty, 39–40, 169 hope, vision and, 405 hot topics, 269 human resource frame, 375 humility, 15 hygiene factors, 232

idea champions, 472 idea incubator, 472 idealized influence, 337 ideals, vision and, 404 imagination, 398 I’m Feeling Lucky: The

Confessions of Google Employee Number 59 (Edwards), 429

immersion, 476–477

implementation, 414 impoverished management,

49 inattention to results, 298 inclusive diversity model,

328 inclusive leadership,

345–347 independent thinking,

140–142. See also critical thinking

India, 9 individual consideration,

337 individual consultations, 81 individualism, 341, 342 individualized leadership,

52–55 individual leadership,

99–133 attitudes, 109–113 cognitive differences,

116–122 Jung’s typology, 123–125 leadership development

cases, 128–131 leadership essentials, 126 Myers-Briggs Type

Indicator, 120 past and future, 127–128 personality, 102–109 personality types, working

with, 120, 122– secret ingredient for,

100–101 social perception and

attribution theory, 113–116

values, 109–113 influence, 5

charismatic leadership and, 363

communication and, 274–275

definition of, 370 See also influential

leadership influence theories, 18 influential leadership,

358–360 charisma and, 361, 362 charismatic leadership,

361–363 circle of, 383–384

coalitional leadership, 363–366

Machiavellian-style leadership, 366–369

transformational leader- ship, 360–361, 362

types of, 360–369 informal interviews, 365 information, 9 in-group relationship, 53 initiating structure, 46, 48 innovation, 471, 473, 479 inquiry. See appreciative

inquiry inspirational motivation,

337 instrumental values,

109–110 integration, 345, 431 integrative negotiation, 314 integrity, 39–40

culture of, 17 vision and, 402

intellectual stimulation, 142, 338

intelligence, 38 intention, 6 intentional leadership, 23 interaction, 302 interactive leadership, 338 interdependence, 41, 292 internal attribution, 115 internal focus, 442 internal integration, 431 internal locus of control,

106, 107 interpersonal communica-

tion, circular model of, 261

interpersonal intelligence, 12 interpret trends, 397 intrapersonal intelligence,

12 intrinsic rewards, 227–228 introversion, 120, 125 intuition, 120, 477–479 involvement, change and,

482–483 involvement culture, 445

job-centered leaders, 48 job challenge, lack of, 80

job characteristics model, 242–243

job design, 242 job enrichment, 244 judging, 120 Jung’s typology, 123–125

knowledge, 142

lack of commitment, 298 lack of trust, 298 language, specialized, 440 large-scale organizational

change, 467–469 lateral thinking, 475–476 law of effect, 236 leader behavior

in-group versus out- group members, 53

meta-categories of, 68 path–goal theory, 77–79 personality traits and,

106–109 themes of, 51 See also behaviors

Leader Behavior Description Question- naire (LBDQ), 46

leader-centered questioning, 266

leader decision styles, 82 leader–member exchange

(LMX), 52, 54 leader–member relations,

74 leader participation styles,

81 leaders

desirable, 211 emotionally competent,

125 fear and, 153–158 follower management of,

203–208 followership and, 196–197 relationship-oriented, 73 roles of, 43 task-oriented, 73 vision and strategic

direction, 394–398

502 SUBJECT INDEX

leadership, 3–30. See also communication

art and science of, 23–24 autocratic versus

democratic, 44–46 charismatic, 361–363 coalitional, 363–366 cultural, 438–441 definition of, 5–6 entrepreneurial, 55–56 ethical, 39–40 good behaviors, 21, 23 inclusive, 345–347 individualized, 52–55 intentional, 23 leader fatal flaws, 21–22 Machiavellian-style,

366–369 vs. management, 13–17 nature of, 4, 5 need for, 4–7 paradigm shift, 25 potential for, 16 right-wrong, 27–28 servant, 175–179 spiritual, 448–451 theories of, 17–20 transformational,

360–361, 362 values-based, 447–451 vision, 18 See also behavior

theories; change; con- tingency approaches; individual leadership; moral leadership; mo- tivation; organizational culture; organizational values; strategic direction; teams; trait theories; vision

leadership coaching, 212, 213, 214

leadership courage, 180 definition of, 180 leadership development

cases, 189–191 leadership essentials, 187 moral leadership and,

168–172 personal courage,

184–187 scary person exercise,

188–189

leadership development cases

Alvis Corporation, 93 change, 486–488 communication, 285–287 Consolidated Products,

58–59 contingency approaches,

93–95 diversity, 352–354 followership, 217–220 individual leadership,

128–131 leadership mind and

heart, 160–162 Marshall Plan, 29–30 moral leadership and

courage, 189–191 motivation, 252–254 organizational culture

and vision, 454–456 power and influence,

384–386 sales engineering division,

28–29 teams, 317–320 transition to leadership,

59–60 vision and strategic

direction, 420–423 leadership diversity. See

diversity leadership effectiveness,

maximization of, 107 Leadership Era 1, 18 Leadership Era 2, 18–19 Leadership Era 3, 19–20 Leadership Era 4, 20 leadership essentials

change, 483–484 communication, 282 contingency approaches,

91 diversity, 349–350 followership, 215–216 individual leadership, 126 leadership, 26–27 leadership mind and

heart, 158–159 moral leadership and

courage, 187 motivation, 249–250 organizational culture

and vision, 451–452

power and influence, 381–382

teams, 315 traits, behaviors, and re-

lationships, 56 vision and strategic di-

rection, 417–418 leadership evolution, model

of, 18–20 Leadership Grid®, 49–50 leadership implications,

343–345 leadership mind and heart,

136–140 emotional intelligence,

146–153 independent thinking,

140–142 leadership development

cases, 160–162 leadership essentials,

158–159 leading with head and

heart, 136 love versus fear, 153–158 mental models, 136–140 mentors, 159–160 open-mindedness,

142–144 personal mastery,

145–146 systems thinking, 144–145

leadership orientation, 47, 376

leadership potential, 16 leadership power. See

power leadership strengths, 36 leadership styles

Fiedler’s contingency model, 72–76

situational theory, 68–72 leadership substitutes, 88–91 leadership vision, 18 leader’s job, 394–398 leader styles

contingency approaches, 69–70

Vroom–Jago model, 81, 82

leader traits. See traits Lean In: Women, Work,

and the Will to Lead (Sandberg), 334

learning leader, 20, 21, 23 learning styles, 12 least preferred coworker

(LPC) scale, 73 legitimate power,

370, 371 level 5 leaders, 13 liar’s loans, 200 likableness, 363 like, 251–252 line of sight, 415 listening, 178, 206,

267–269, 283–285 LMX. See leader–member

exchange (LMX) locus of control, 106–108 logical-mathematical

intelligence, 12 loss aversion, 229 love, 147, 153–158,

251–252 lower needs, 227 low follower readiness

level, 71 low task-high relationship

leader styles, 68 low task-low relationship

leader styles, 68

Machiavellian-style leader- ship, 366–369

make-it-happen attitudes, 198

making progress principle, 248

The Male Factor: The Unwritten Rules, Misperceptions, and Secret Beliefs of Men in the Workplace (Feldhahn), 332

management by wandering around (MBWA), 280

management communica- tion, 262

management, leadership and, 13–17

management strategies, of followers, 202–208

managing up, 196 Marshall Plan, 29–30 masculinity, 341, 342

SUBJECT INDEX 503

meaning through employee

engagement, 245–248 vision and, 402

mental models, 136–140 mentors, 159–160 middle-of-the-road

management, 49 mind, clarity of, 145 mindfulness, 141, 143 mindlessness, 141 minorities, 330–335.

See also diversity minority sponsorship,

348–349 mission, 406–411 moderate follower

readiness level, 71 moral courage, 183 morale, 303 moral leadership,

168–172 actions, 172–173 contemporary, 168 courage and, 179–187 development of, 174 leadership development

cases, 189–191 leadership essentials, 187 scary person exercise,

188–189 servant leadership,

175–179 motivation, 224–226

carrot-and-stick approach, 235

definition of, 226 empowerment, 241–245 engagement, 245–248 equity theory, 239–240 expectancy theory,

238–239 fear-based, 158 followers, 198 inspirational, 337 leadership and, 226–230 leadership development

cases, 252–254 leadership essentials,

249–250 love-based, 158 needs-based theories of,

230–235 new ideas for, 248–249

reinforcement perspective on, 236–237

should, need, like, love, 251–252

motivators, 232 multiple intelligences, 12 musical intelligence, 12 Myers-Briggs Type

Indicator (MBTI), 120

needs, 226, 251–252 higher and lower, 227

needs hierarchy, 230–231 negative reinforcement, 237 negotiation, 314–315 networking, 22, 262, 367 network of relationships,

209 neuroticism, 103 neutralizers, 88 noble purpose, 408–411 nonconformity, 181–182 nonroutine messages,

276–277 nonverbal communication,

278–280 norming stage (team

development), 300–301 norms, 429

objectives, clarity of, 145 observers, 366, 374 Ohio State studies, 46–48 open communication,

265–266 open culture, 472 open-mindedness, 142–144 openness to experience, 105 operational role, 42, 43 opportunities, 462, 472 opposites, consideration of,

476 optimism, 38–39 opt-out trend, 333 Organizational Assessment

Survey, 435 organizational awareness,

150, 151 organizational causality,

circles of, 144, 145

organizational change. See change

organizational culture, 18, 428–432

definition of, 438 importance of, 431–432 leadership development

cases, 454–456 leadership essentials,

451–452 organizational values

and, 441 performance, 433–435 strength, 433–435 walk the talk, 452–454

organizational diversity, value of, 329–330. See also diversity

organizational intrusions, 215

organizational teams, 292–296

organizational values, 441 ethics, 446–447 leadership development

cases, 454–456 leadership essentials,

451–452 organizational culture

and, 428–432 values-based leadership,

447–451 walk the talk, 452–454

organizational variables, leadership substitutes and, 88

organizations fear in, 154–156 love in, 156–158

outcomes contingency versus univer-

salistic approaches, 66 creation of, 14 path–goal theory, 77, 80

out-group relationship, 53

paradigm shift, 7, 25 partial reinforcement, 237 participating style, 71 participative leadership, 78 participative management,

176

partners, 366, 374 partnership assumption,

177 partnership building, 54–55 passion, 198 passive behavior, 199 passive bias, 331 passive followers, 200 path clarification, 76 path–goal theory, 76–81 Patient Protection and

Affordable Care Act, 8 peer pressure, 379 people, change, 480–483 people, creative, 473–479 people-oriented leadership,

51, 88 people skills, 22 perceiving, 120 perception. See social

perception perceptual defense, 115 perceptual distortions,

114–115 performance

organizational culture and, 433–437

team cohesiveness and, 303

teams and, 300 performing stage (team

development), 301 peripheral vision, 144 personal attraction, 302 personal characteristics, 38 personal compact, 480 personal courage,

184–187 personal diversity, 351

awareness, 345, 347 personality, 38, 102

model of, 102–105 traits and leader

behavior, 106–109 personality types, working

with, 122 personalized leaders, 380 personal leadership

orientation, 47 personal leadership

qualities, 15–16. See also traits

personal mastery, 145–146 personal power, 373

504 SUBJECT INDEX

personal sources, 208–209 personal values, 447–448 personal vision, 401 persuasion, 208, 274–275,

377, 378 physiological needs, 230 Pike Syndrome, 142 polarities, 79 political activity, 374–380 political frame, 375–376 politics, definition of, 374 position power, 74, 373 positions, compelling, 274 position sources, 209 positive and negative

motives, 228–230 positive emotional attractor

(PEA), 482 positive reinforcement,

236–237 postconventional level, 175 power, 358–360

definition of, 369 ethical action, 380–381 follower responses to,

373–374 of followership, 201 hard versus soft,

369–374 leadership development

cases, 384–386 leadership essentials,

381–382 political activity and,

374–380 position, 9, 74 types of, 370–373

power distance, 340, 341 power distributions, 9 power needs, 234 power of stories, 272–273 Power: Why Some People

Have It and Others Don’t (Pfeffer), 367

practice, 215 pragmatic survivors, 199,

200 preconventional level, 174 prejudice, 331–332 pride, 147 The Prince (Machiavelli),

366, 368 principled level, 175 print media, 276

problem-solving styles, 120. See also Myers- Briggs Type Indicator

problem-solving teams, 294 projection, 114 project team, 295 promote collaboration,

472–473 protocols, 300 psychology, 36 punishment, 237 purpose. See mission purpose-directed

communication, 264 purposes, 5

Q12 study, 407 quadrant-A dominance,

117 quadrant-B dominance,

117, 118 quadrant-C dominance,

118 quadrant-D dominance,

118–120 questioning, 266–267, 269 quick wins, 467 Quiet: The Power of

Introverts in a World That Can’t Stop Talking (Cain), 106

racism, 326 rational persuasion, 377,

378 reality, facing, 139 reciprocity, 378 redundant communications,

276 reference frames, 374–377 referent power, 371,

372–373 reinforcement, definition

of, 236 reinforcement theory,

236–237 relational theories, 18 relationship behavior, 68 relationship building, 15 relationship conflict, 310

relationship management, 150, 151–152

relationship-oriented leader, 73

relationships, 69, 144 fear and, 156 followers and, 198 leader-member, 74

relief, 147 repetition, behavior, 482 resigning, 211 resistance, 156, 374, 463,

464 resistant cultures, 435 resisters, 366, 374 resources, followers as,

205–206 responsibility, 139, 181,

209 responsive cultures,

433–435 reward-increasing path, 80 reward power, 371 rewards, 226, 227–228.

See also motivation right-wrong leadership,

27–28 ripple effect, 373 risk taking, 442 role play

change, 484–486 followership, 216–217 task versus relationship,

92–93 routine messages, 276

sadness, 147 safety needs, 230 satisfaction, 232, 303 scary person exercise,

188–189 science

leadership, 23–24 selection, 440 self-actualization needs,

230 self-awareness, 100–101,

150 self-confidence, 38, 71 self-directed teams,

295–296 self-efficacy, 39, 241, 411

self-interest, service before, 178

self-management, 150–151 self-reference, 404 self-responsible employees,

176 self-serving bias, 115–116 sensegiving, 263 sensing, 120 servant leadership, 18,

175–179 Servant Leadership

(Greenleaf), 178 service orientation, 150,

151 sexism, 326 Shackleton’s Way (Morrell

and Capparell), 67 shame, 147 shared goals, 302 short-term wins, 467 should, 251–252 sight lines, 415 situational contingencies,

79–80 situational theories, 18, 76 situations, Fiedler’s contin-

gency model, 74 social awareness, 151 social background, 38 social characteristics, 38 socialization, 440 socialized leaders, 380 social loafing, 297 social media, 280–281 social perception, 113–116 social values, 341 social value systems,

340–342 sociocultural environment,

339–340 socioemotional role, 306 soft power, 369–374 specialized language, 440 special-purpose team, 295 speedstorming, 473 spirituality, 449 spiritual leadership, 450 spiritual values, 448–451 sponsorship, 349 stability, 17, 20, 442 stadium run, 440 stakeholder buy-in,

365–366

SUBJECT INDEX 505

stakeholders, coalitional leadership and, 365

standard of excellence, through vision, 402

status quo, 363 stereotypes, 114, 331–332 stewardship, 177 stories, 439 storming stage (team

development), 300 strategic action, 394, 395 Strategic Adaptors, 414 strategic conversations,

264–273 strategic decision making,

415–417 strategic direction,

396–397 future thinking,

418–420 leader’s contribution,

402, 415 leadership development

cases, 420–423 leadership essentials,

418–418 leader’s job, 394–398 strategy execution,

413–415 vision and, 398–406

Strategic Innovators, 414 strategic leadership,

domain of, 396 strategic management, 411 strategy

definition of, 411 elements of, 413–414

strategy execution, 413 strategy formulation, 413 strategy style, 414 streamlined team size,

299 strength, organizational,

433–437 strengths, 41–43 structural frame, 375 subordinate-centered

leadership, 45 subordinates, 176 subprime mortgages, 200 substitutes, 88–91 support, 185, 197, 299 supporting style, 70 supportive leadership, 77

supportive performance management system, 300

support system, 482 SWOT, 412 symbolic frame, 375,

376–377 symbols, 439 synergy, 413 systems thinking, 144–145

Take the Lead (Myers), 37 talent, 197 task behavior, 68 task characteristics,

leadership substitutes and, 88

task conflict, 310 task-oriented leadership,

51, 88, 90 task-specialist role, 306 task structure, 74 task versus relationship role

play, 92–93 team cohesiveness,

302–303 team competencies,

304–305 team conflict. See conflict team management, 49 team member morale, 303 team member roles,

305–306 team members dilemma,

296–298 team norms, 303–304 team players, 176 teams, 290–292

conflict management, 309–315

core work, 177 definition of, 292 development of, 299–302 dilemma of, 296–298 feedback, 316–317 high performance,

298–299 leadership development

cases, 317–320 leadership essentials,

315 organizational, 292–296

processes, 299–304 types of, 294–296 value of, 292–296 virtual and global,

306–309 team success, 303 tell courage, 186 telling style, 71 Tell to Win: Connect,

Persuade, and Triumph with the Hidden Power of Story(Guber), 273

Ten Steps Ahead (Calonius), 399

terminal values. See end values

Theory X, 112, 113 Theory Y, 112, 113 thinking, 118

big-picture, 396 critical and uncritical,

199 diversity in, 329–330 lateral, 475–476 See also leadership mind

and heart thinking patterns,

116–120 threats, 462, 463 thriving workforce,

248–249 time-based model, 83 T–P Leadership

Questionnaire, 69 traditional diversity model,

328 traits, 36–41

definition of, 36 ideal, 57–58 personality, 100, 102 strengths, 41–42

trait theories, 17, 36–41 drive, 38, 40–41 honesty and integrity, 38,

39–40 optimism and self-confi-

dence, 38–39 transactional leadership,

360 transformational

leadership, 18, 360–361, 362

transformation, participa- tion in, 210

trust, 40, 178, 298 trust courage, 186 trustworthiness, 150, 151,

181 truth, 138 truthfulness, 281 try courage, 186 two-factor theory,

231–234 typology. See Jung’s

typology

unambiguous roles, 298 uncertainty avoidance,

340–342 unconscious bias,

331, 332 uncritical thinking, 199 understanding, 202–204 unethical behavior, of

leaders, 168 unethical conduct, courage

and, 184–185 uniformity, 10, 23 United States Africa Com-

mand (USAFRICOM), 264–265

universalistic approaches, 66

University of Michigan Studies, 48–49

USA Today, 170

valence, 238 values, 109–113, 172, 407,

408 creative, 472–473 spiritual, 448–451 See also organizational

values values balancing, 327 values-based leadership,

447–451 verbal-linguistic intelligence,

12 vertical dyad linkage (VDL)

model, 53 vertical teams, 294 very high follower readiness

level, 71

506 SUBJECT INDEX

virtual teams, 306–309, 307 visibility, 281 vision, 14, 144

cocreate, 405 destination and the

journey, 404–405 energizes people and

focuses attention, 401–402

future thinking, 418–420 identify strengths, 405 leadership development

cases, 420–423

leadership essentials, 417–418

mission and, 406–411 nature of, 400 reflects high ideals, 404 standard of excellence

and integrity, 402 strategic direction and,

398–406 target, 405 themes of, 403

visionary leadership, 403 vision statements, 398–399

Vroom–Jago contingency model, 81–88

walk the talk, 452–454 wall of fear, 182 Washington Post, 4 What Got You Here Won’t

Get You There (Goldsmith and Reiter), 141

whistleblowing, 184

The Whole Brain Business Book (Herrmann), 119

whole brain concept, 117 whole employees, 176 win–win solution,

314–315 women, 336–339. See also

diversity workforce diversity, 327 work-related characteristics,

SUBJECT INDEX 507