Leadership – Weekly Analysis
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WK7.docxMGMT331 | LESSON 7
Leader as a Planner
LESSON TOPICS
Leadership Planning
Path-Goal Leadership Theory
Goal-Setting
Transformational Leadership
KEY TERMS
Achievement Oriented Leader Behavior
Charismatic Leaders
Contingent Rewards
Directive Leader Behavior
Intermediate Planning
Management by Objectives
Management by Exception
Milestones
Mission Statement
Operational Planning
Participative Leader Behavior
Path-Goal Leadership Theory
Plan
Project Planning
Strategic Planning
Supportive Leader Behavior
SWOT Analysis
Transactional Leaders
Transformational Leaders
INTRODUCTION
Throughout this lesson, you will learn about how leaders are involved in planning activities at every level of an organization. Strategic planning starts with leaders establishing clear visions and missions for their companies. Leaders are also crucial in aligning intermediate plans, operational plans, and project plans with their visions. Additionally, they play a crucial role in supporting other organizational leaders and ensuring resources are available to achieve all goals. You will also explore the path-goal leadership theory and styles that are highly applicable to leaders as they strive to accomplish goals. The importance of setting SMART (Specific, Measurable, Achievable, Realistic, Time-based) goals and engaging in management by objectives are also discussed. Finally, you will differentiate between transformational and transactional leadership styles and understand the implications of those styles for leadership planning.
Leadership Planning: Vision vs. Mission
Can you think of a single leader who is not an exceptional planner? Usually, the leaders accomplishing the most admirable and stunning goals are those who have put a lot of thought, planning, and effort into turning those goals into reality. But where do the goals come from? You learned about leaders as visionaries in a previous lesson and, as you learned, the vision for any organization is its future: where is the organization going? The leader is the driver of that vision. One example of a vision would be Microsoft leader Bill Gates’ famous aspirations to have “a computer on every desk and in every home” (Weil, 2008).
While the organizational vision could best be described as where the company is going, the organizational mission statement outlines the business’ purpose and reason for existence in its present state, which should support the long-term vision (Evans, 2010). Although it may be difficult for leaders, it is crucial that the vision statements and mission statements are crafted well, unifying all stakeholders with common purpose and goals. An excellent vision statement should be inspirational and forward-thinking. A great mission statement should make it clear to employees “why an organization exists” in terms of “what it does, who it does it for [and] how it does what it does” (Evans, 2010). Employees should clearly understand both and be able to repeat it to anyone who asks.
Additionally, here are some components of an effective mission statement:
“Defines your organization for key stakeholders
Creates an inspiring vision of what the organization can be and can do
Outlines how the vision is to be accomplished
Establishes key priorities
States a common goal and fosters a sense of togetherness
Creates a philosophical anchor for all organizational activities
Generates enthusiasm and a ‘can-do’ attitude
Empowers present and future organization members to believe that every individual is a key to success” (Kreitner & Cassidy, 2011, p. 157-158).
Think of a successful organization and write down what you believe their vision and mission statements are. Then, research the company online to see if the vision and mission statements are publicly available. Once you find them, compare the statements to your own. Do you think the organization is on target and that the vision and mission are well-aligned? Why or why not?
Planning
Vision and mission statements are key for leaders to develop effective plans for organizations. A plan may be defined as a “specific, documented intention consisting of an objective and an action statement” (Kreitner & Cassidy, 2011, p. 157). Plans will outline what needs to be accomplished, how it will be done, and when it is expected to be complete. It is also ideal that planning starts at the highest levels of an organization and then travels down so that any necessary resources, policies, and buy-in are established.
There are several types of planning as leaders must be engaged in both long-term and short-term initiatives.
STRATEGIC PLANNING
Top-level leaders such as C-suite executives and division heads are typically engaged instrategic planning efforts, which can take between one and 10 years to plan and implement. Shorter-term planning initiatives that occur within the organization are intermediate planning, which spans from six months to two years, and operational planning , which occurs within a weekly to yearly timeframe.
OPERATIONAL PLANNING
Operational planning is typically done by front-line managers who decide how to accomplish tasks with given resources and timeframes. This is the shortest-term planning.
INTERMEDIATE PLANNING
On the other hand, intermediate planning is completed by higher-level middle managers, such as department heads, and entails planning subunit contributions and resource allocation. Although leaders of organizations do not always complete operational and intermediate planning themselves, they play a key role in outlining the highest-level strategic planning and supporting the lower-level managers. Leaders verify that actions are aligned with all levels of planning and they also ensure necessary resources are in place so that the initiatives may be accomplished.
PROJECT PLANNING
Leaders must also engage in, and recognize the necessity for, project planning.
According to the American Management Association staff (2017), it is important to involve your staff in the group planning process and to ensure that potential problems with corresponding solutions are identified. During strategical planning, leaders should conduct a situational analysis or SWOT analysis, to identify strengths and weaknesses internal to the organization in addition to external opportunities and threats. A SWOT analysis will aid the organization in identifying what your organization is doing exceptionally well and what improvements or advancements could be made. It is crucial that a comprehensive plan addresses opportunities and threats and outlines any contingencies, or fallback plans if adverse events occur. Plans must be realistic, flexible, and understandable by all (American Management Association (AMA) Staff, 2017).
Path-goal Leadership Theory
As you learned about in a previous lesson, the path-goal theory of situational leadership focused on the importance of establishing clear goals and clearing the path toward goal attainment. Established by Robert House and Terence Mitchell (1974), the path-goal theory reinforces the value in an achievement-oriented mindset of leaders and members within an organization. House later reformulated his theory in 1996 and asserted that leaders must engage in specific activities for employees to be motivated and able to achieve goals (Kreitner & Cassidy, 2011).
Since the path-goal theory is a situational model, leaders should adapt these behaviors according to each situation they face. Leaders may experience different challenges as they navigate organizational pressures to meet goals in a rapidly changing technological business environment. Also, they may encounter followers of varying levels of preparedness and motivation. To effectively utilize the recommendations of the path-goal theorist, leaders must clearly be excellent planners. Once they assess all the situational factors at play, including needs of the organization and followers, they must create and enact a plan to set goals and achieve goals in collaboration with their followers.
LEADERSHIP ACTIVITIES
Set Goals
Clarify the Followers’ Perception of those Goals
Link Goals to Rewards
Establish the Path and Explain how Goals are Attained
Clear the Path and Remove and Obstacles
Reward Based on Performance of Goals
Path-goal Leadership Theory
Additionally, House and Mitchell (1974) outlined four different types of leader behaviors, which are outlined below. Each of these four behaviors requires leadership planning as well.
DIRECTIVE LEADER BEHAVIOR
Directive Leader Behavior is a path-goal theory behavior stating that leaders should clarify expectations, policies, processes, roles, and rewards for followers
Leaders can proactively plan for a rewards system and communicate that system with the employees. They could institute merit increases for performance or opportunities for internal promotion. Transparency is also important because the policies and rules should be written and described clearly. Additionally, they should be communicated and shared to all in the organization. Leaders may also aid in clarifying roles and responsibilities.
SUPPORTIVE LEADER BEHAVIOR
Supportive Leader Behavior is a path-goal theory behavior stating that leaders can display concern for followers, reduce stress, increase confidence, and meet psychological needs.
Leaders can enact policies that enable concerned employees to voice issues or challenges so they can be addressed.
PARTICIPATIVE LEADER BEHAVIOR
Participative Leader Behavior is a path-goal theory behavior stating that leaders should encourage feedback from employees and consider their opinions and ideas during any decision-making processes.
When possible, leaders should also give followers more autonomy and ownership of goal attainment. Leaders can institute an open-door policy and a friendly atmosphere so employees feel comfortable to voice concerns. Additionally, leaders can create autonomous work teams and encourage them to collaborate and reach decisions on their own. Leaders may also plan to increase member autonomy and responsibilities as they advance within their roles and in the organization.
ACHIEVEMENT ORIENTED LEADER BEHAVIOR
Achievement Oriented Leader Behavior is a path-goal theory behavior stating that leaders should strive for excellent performance and continuous improvement.
In terms of planning, leaders can institute standards of excellence and make it a point to assess not only excellent performance but also improvements in performance over time. Leaders can also demonstrate confidence in the team and individuals through all communications and interactions with followers. Speaking positively with praise about accomplishments and giving recognition when possible is a great plan of action for leaders.
Kreitner and Cassidy summarized House’s updated work nicely by stating that “the more clearly a leader can articulate how the organization will overcome obstacles and beat its competitors, the more motivated, determined, and innovative the leader’s followers will become” (Kreitner & Cassidy, 2011, p. 400). Have you experienced or witnessed a leader using any, or a combination, of these path-goal leader behaviors? Was that leader effective in motivating follower to accomplish goals? Which of the path-goal leader behaviors do you think you exhibit?
Goal-Setting
Have you experienced the achievement of a goal that you worked so diligently to accomplish? When you think of that goal, was it easy or difficult? Leaders are constantly challenging themselves, or being challenged by others, to accomplish amazing, and sometimes seemingly impossible, feats! They must also dedicate a great amount of time and energy to motivate their people to accomplish goals as well. According to goal-setting theory, it’s been noted that goals should be specific and challenging to motivate the best possible individual efforts to achieve the goals. Additionally, goal-setting theory stresses the importance of feedback or progress made by individuals as they work to achieve their goals (Robbins & Judge, 2014).
When you thought of the goal you accomplished, was it easy to accomplish it? Usually, leaders deal with a great amount of complexity in the organizational issues and challenges they face, as you learned when we explored the leader’s role as a problem-solver. Accordingly, the solutions to these problems tend to be just as complex and detailed. Therefore, the associated goals may often be difficult to accomplish. According to goal-setting theory, this increased level of difficulty is a great motivator of performance. If goals are too easy to attain, then the accomplishment is not valued as highly and is not as likely to increase motivation to achieve goals in the future.
As you reflected upon the goal you attained, was it very specific? For example, did you achieve a goal you set to lose weight or did you achieve a goal you set to lose 20 pounds? The more specific the goals, the more likely that you are to attain them. Specific goals for leaders and their followers hold them to a higher level of accountability and are also easier to visualize. A leader would not set a vague goal to capture a larger share of the market. Instead, they would set a specific goal to increase market share by 15 percent in the coming year by developing a new and innovative product. As a leader, it is crucial that you set specific goals for yourself and for your followers.
Finally, the last component of goal-setting theory addresses the importance of feedback as progress is made towards accomplishing the goal. Those who may have a goal to lose 20 pounds in 6 months probably count calories every day and weigh themselves once a week. As they hop on the scale each week, if they see they have lost weight, that is an excellent motivator to keep them on track towards reaching the goal. Leaders should plan to monitor their own progress towards goal attainment. Additionally, they should have a plan to meet with team members or individuals to receive status updates on their progress as well. They may need to meet often or periodically, depending on the situation and the followers’ needs as well.
Milestones
In the market share goal example, receiving updates is a great motivator and helps unify the organization. For example, leaders should announce the accomplishment and celebrate important milestones as they work towards a greater goal. Celebrating milestone achievements is also consistent with the kaizen approach, which focuses on regular, continuous improvements towards larger success (Caroselli, 2000). According to Fisher (2017), “goals define where you’re going and milestones let you know if you’re actually getting there.”
MANAGEMENT BY OBJECTIVES
Since the 1970s when Peter Drucker developed the concept, many organizations have utilized the management by objectives, or MBO, approach. MBO requires joint-participation and decision-making, between leaders and followers, to agree upon specific goals and objectives that the employees should achieve within a specific timeframe. The major difference between goal-setting theory and management by objectives is that goal-setting theory does not underline or stress the importance of joint decision-making of the actual goals. MBO stresses the effectiveness of goals being established from collaboratively from both the top of the organization down and from the bottom of the organization up (Robbins & Judge, 2014).
SMART Goals
One means of implementing the management by objectives strategy is SMART goal-setting (Bogue, 2005). Once leaders have defined strategic goals and objectives for the organization, they can meet with individuals and teams to establish lower-level goals that align well with the larger initiatives. When goals are agreed upon, it is an excellent motivator if the goals are SMART goals, which means they are:
Specific
Measurable
Achievable
Realistic
Time-based
If you recall the example of the market-share goal, the leader’s SMART goal was very specific and time-based (gain 15 percent of the market share in the coming year). How could that goal be measured? Perhaps, they could evaluate performance indicators such as sales and profitability after the next year is over. Is the goal achievable and realistic? That would depend upon resources the organization has access to and, additionally, some of the competitive forces in the market, which they should carefully evaluate.
Transformational Leadership
As you are reflecting upon the leader’s role in all planning aspects of the organization and considering the path-goal theory, it’s an excellent time to consider the transformational leadership theory. James McGregor Burns (1978) described transformational leaders as “visionaries who challenge people to achieve exceptionally high levels of morality, motivation, and performance” (Kreitner & Cassidy, 2011). Transformational leaders put the vision of the organization above their own personal needs and self-interests. They also exhibit and encourage creative behavior while exciting and inspiring their followers (Robbins & Judge, 2014).
CHARACTERISTICS OF TRANSFORMATIONAL LEADERS
IDEALIZED INFLUENCE
Transformational leaders inspire through their sense of vision, communicate the organizational mission, and instill pride among their followers.
INSPIRATIONAL MOTIVATION
Followers are motivated because the transformational leader continuously shares high expectations and conveys the importance in the purpose of organizational goals.
INTELLECTUAL STIMULATION
Creative Transformational leaders encourage creative yet logical problem-solving efforts while promoting followers’ intelligence and innovative thinking.
INDIVIDUALIZED CONSIDERATION
Transformational leaders are coaches who give individual followers one-on-one attention, encourage continuous personal development, and ensure followers that they are known and appreciated as individuals.
Transactional Leadership
The path-goal theory and other contingency models suggest that leader behaviors are transactional in nature. In contrast to transformational leaders who inspire actions through a unified vision, transactional leaders clarify specific goals and monitor tasks so they are completed in accordance with plans. They are concerned with work transactions being accomplished, whether the vision is clearly communicated or not.
Transactional leadership rewards followers for the achievement of objectives and goals. These rewards for results are known as contingent rewards (Northouse, 2010). An example would be a promised promotion or raise in exchange for completion of a performance goal to increase the company’s customer base by 10 percent in six months. It’s likely that these exchanges, or transactions, serve in the best interest of the leader as well because it may advance their departmental or organizational initiatives and agendas. In this case, the leader or manager may receive a monetary incentive or bonus for increases in customers or sales attained by their subordinate. Transactional leaders may also utilize management by exception.
Although the two leadership styles are apparently different, they are not opposing or contradictory in nature. In fact, leaders can and should adopt both styles of leadership. Robbins and Judge (2014) noted that “the best leaders are transactional and transformational” (p. 188). Conventionally, the transactional leadership style works well to maintain the current state of an organization and regular accomplishment of goals and objectives.
Transactional leaders work to realize expected outcomes. Additionally, the transformational leadership style is excellent when performance beyond standard expectations is desired. This style, or a combination of both the transactional and transformational leadership styles, may aid organizations that need to evolve, innovate, or change.
Charismatic Leadership
Aligned with the transformational leadership style is the charismatic leadership theory, which asserts that charismatic leaders possess key characteristics such as a well-articulated vision, comfort with taking high personal risks, sensitivity and perception of followers needs, and unconventional or novel behavior outside the norm (Robbins & Judge, 2014). Charismatic leaders tend to be highly effective in motivating followers. Unique visionaries, such as Steve Jobs, anticipate consumer and employee needs and are willing to take substantial personal and business risks to attain goals. Research has also shown that charismatic leadership tendencies are innate (some are born with them) but that they can also be developed over time (Robbins & Judge, 2014). Charismatic leaders are also great with appealing to the emotions of followers through their passionate vision and sensitivity to follower needs and perceptions.
Clearly, planning is extremely important for both the transactional and transformational leadership approaches. Policies and processes guiding the use of contingent rewards and management by exception must be carefully planned by organizational leaders. They should also be agreed upon and communicated to all followers as well. Although charismatic leaders may act unconventionally at times and take high risks, they are also very calculated and engage in high-level strategic planning.
Do you think of yourself as a transactional leader, a transformational leader, or a combination of both? Do you think certain industries or businesses would benefit from one style more than another? Why?
Conclusion
