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Chapter 3 Chapter Outline 64 The Contingency Approach 66 Fiedler’s Contingency Model 71 Hersey and Blanchard’s Situational

Theory 75 Path–Goal Theory 79 The Vroom–Jago Contingency Model 85 Substitutes for Leadership

In the Lead 69 Tom Freston, Viacom, Inc. 74 Carole McGraw, Detroit Public

Schools 78 Bob Nardelli, The Home Depot 84 Dave Robbins, Whitlock

Manufacturing 88 Lawrence H. Summers, Harvard

University

Leader’s Self-Insight 67 T–P Leadership Questionnaire:

An Assessment of Style 74 Are You Ready? 87 Measuring Substitutes for Leadership

Leader’s Bookshelf 65 Leadership and the New Science

Leadership at Work 90 Task Versus Relationship Role Play

Leadership Development: Cases for Analysis 90 Alvis Corporation 91 Finance Department

Your Leadership Challenge After reading this chapter, you should be able to:

• Understand how leadership is often contingent on people and situations.

• Apply Fiedler’s contingency model to key relationships among leader style, situational favorability, and group task performance.

• Apply Hersey and Blanchard’s situational theory of leader style to the level of follower readiness.

• 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.

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Contingency Approaches For Pat McGovern, founder and chairman of International Data Group, a technology publishing and research fi rm that owns magazines such as CIO, PC World, and Computerworld, having personal contact with employees and letting them know they’re appreciated is a primary responsibility of leaders. McGovern treats people to lunch at the Ritz on their 10th anni- versary with IDG to tell them how important they are to the success of the company. He personally thanks almost every person in every business unit once a year, which takes about a month of his time. Managers provide him with a list of accomplishments for all their direct reports, which McGovern memorizes the night before his visit so he can congratulate people on spe- cifi c accomplishments. Rather than establishing strict goals and standards for task accomplishment, McGovern decentralizes decision making so that people have the autonomy to make their own decisions about how best to do their jobs.

Wolfgang Bernhard, a member of Volkswagen AG’s board of manage- ment responsible for the core VW brand, displays a very different style of leadership. When he came to the struggling company, Bernhard moved quickly to cut jobs, scale back investments in underperfoming units, and get people focused on quality and productivity issues. He ordered more than 200 employees to report to an auditorium a few miles from headquarters, formed them into teams and told them to fi gure out ways to meet specifi c cost reduction goals, and instructed them not to return to their workplaces until they’d done so. Often working until midnight, the teams took four weeks to meet the targets. Bernhard has also tied managers’ bonuses to demonstrated improvements in quality and productivity. His hard-charging style has ran- kled some long-time employees and managers, but Bernhard doesn’t mind. “I am quick and focused, and I like to cut the formalites,” he says.1

IDG’s Pat McGovern is strongly people-oriented—that is, character- ized by high concern for people and low concern for production. Wolfgang Bernhard, in contrast, is a strong, task-oriented leader, high on concern for production and relatively low on concern for people. Two leaders, both suc- cessful, with two very different approaches to leading. This difference 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?

In the above example, Bernhard and McGovern are performing leader- ship in very different situations. Volkswagen AG recruited Bernhard to assist in a massive restructuring and help the company reverse a steep drop in profi ts. Many people, including CEO Bernd Pischetsrieder, believe Bernhard’s blunt honesty and task-oriented approach is just what is needed to get the au- tomaker back on track. McGovern, on the other hand, is operating in a much more favorable business situation. As a smaller, privately-held company, IDG isn’t under the same kind of public pressures from investors and analysts as Volkswagen. IDG is a leader in its industry, publishes more than 300 maga- zines and newspapers, and consistently earns industry awards. Morale and motivation among employees is high.2

This chapter explores the relationship between leadership effectiveness and the situation in which leadership activities occur. Over the years, re- searchers have observed that leaders frequently behave situationally—that is, they adjust their leadership style depending on a variety of factors in the

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situations they face. In this chapter, we discuss the elements of leader, follower, and the situation, and the impact each has upon the others. We examine several theories that defi ne how leadership styles, follower attributes, and organizational characteristics fi t together to enable successful leadership. 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 fi nd universal leader traits or behaviors that would always de- termine 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 or- ganizational situations. Aptly called contingency approaches, these theories explain the relationship between leadership styles and effectiveness in specifi c situations.

The universalistic approach as described in Chapter 2 is compared to the contingency 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 fi t 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 lead- ership. Contingency means “it depends.” This chapter’s Leader’s Bookshelf talks about a new approach to leadership for a new kind of contingency facing today’s organizations.

Contingency a theory meaning one thing depends on other things

64 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Exhibit 3.1 Comparing the Universalistic and Contingency Approaches to Leadership

Universalistic Approach

Contingency Approach

Followers Situation

Leader

Outcomes (Performance, satisfaction, etc.)

Leadership Traits/behaviors

Style Traits

Behavior Position

Outcomes (Performance, satisfaction, etc.)

Needs Maturity Training

Cohesion

Task Structure Systems

Environment

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The contingencies most important to leadership as shown in Exhibit 3.1 are the situation and followers. Research implies that situational variables such as task, structure, context, and environment are important to leadership style, just as we saw in the opening examples. The nature of followers has also been identi- fi ed as a key contingency. Thus, the needs, maturity, and cohesiveness of followers make a signifi cant difference to the best style of leadership.

Several models of situational leadership have been developed. The contin- gency model developed by Fiedler and his associates, the situational theory of Hersey and Blanchard, path-goal theory, the Vroom–Jago model of decision participation, and the substitutes for leadership concept will all be described

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Leadership and the New Science

by Margaret J. Wheatley

Leader’s Bookshelf

In searching for a better understanding of organizations and leadership, Margaret Wheatley looked to science for answers. In the world of Newtonian physics, every atom moves in a unique predictable trajectory determined by the forces exerted on it. Prediction and control are accomplished by reducing wholes into discrete parts and carefully regulat- ing the forces that act on those parts. Applied to organiza- tions, this view of the world led to rigid vertical hierarchies, division of labor, task description, and strict operating proce- dures designed to obtain predictable, controlled results.

Just as Newton’s law broke down as physics explored ever-smaller elements of matter and ever-wider expanses of the universe, rigid, control-oriented leadership doesn’t work well in a world of instant information, constant change, and global competition. The physical sciences responded to the failure of Newtonian physics with a new paradigm called quantum mechanics. In Leadership and the New Science, Wheatley explores how leaders are redesigning organizations to survive in a quantum world.

CHAOS, RELATIONSHIPS, AND FIELDS From quantum mechanics and chaos theory emerge new understandings of order, disorder, and change. Individual actions, whether by atoms or people, cannot be easily predicted and controlled. Here’s why:

• Nothing exists except in relationship to everything else. It is not things, but the relationships among them that are the key determinants of a well-ordered system we perceive. Order emerges through a web of relationships that make up the whole, not as a result of controls on individual parts.

• The empty space between things is filled with fields, invisible material that connects elements together.

In organizations, the fields that bind people include vision, shared values, culture, and information.

• Organizations, like all open systems, grow and change in reaction to disequilibrium, and disorder can be a source of new order.

IMPLICATIONS FOR LEADERSHIP These new understandings provide a new way to see, understand, and lead today’s organizations. The new sciences can influence leaders to:

• Nurture relationships and the fields between people with a clear vision, statements of values, expressions of caring, the sharing of information, and freedom from strict rules and controls.

• Focus on the whole, not on the parts in isolation. • Reduce boundaries between departments and

organizations to allow new patterns of relationships. • Become comfortable with uncertainty and recognize

that any solutions are only temporary, specific to the immediate context, and developed through the relationship of people and circumstances.

• Recognize that healthy growth of people and organiza- tions is found in disequilibrium, not in stability.

Wheatley believes leaders can learn from the new sciences how to lead in today’s fast-paced, chaotic world, suggesting that “we can forgo the despair created by such common organization events as change, chaos, information overload, and cyclical behaviors if we recog- nize that organizations are conscious entities, possessing many of the properties of living systems.”

Leadership and the New Science, by Margaret J. Wheatley, is published by Berrett-Koehler Publishers.

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66 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

in this chapter. The 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 fl exibility to behave according to the appropriate style, successful outcomes are highly likely.

Two basic leadership behaviors that can be adjusted to address various contingencies are task behavior and relationship behavior, introduced in the previ- ous chapter. Research has identifi ed these two meta-categories, or broadly defi ned behavior categories, as applicable to leadership in a variety of situations and time periods.3 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 ap-

proaches—high task–low relationship, high task–high relationship, high relationship–low task, and low task–low relationship. 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 behaviors include providing support and recognition, de-

veloping followers’ skills and confi dence, and consulting and empower- ing followers when making decisions and solving problems.

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

Fiedler’s Contingency Model An early extensive effort to link leadership style with organizational situation was made by Fiedler and his associates.4 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 orga- nizational situation.

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 Organizational Studies 9, no. 1 (2002), pp. 15–32.

TA S

B EH

A V

IO R

RELATIONSHIP BEHAVIOR

High

Low Low High

High Task–Low Relationship • Authoritative style • Plan short-term activities • Clarify tasks, objectives, and expectations • Monitor operations and performance

• Coaching toward achievement style • Combine task and relationship behaviors

High Task–High Relationship

High Relationship–Low Task • Participative or supportive style • Provide support and encouragement • Develop followers’ skill and confidence • Consult followers when making decisions and solving problems

Low Task–Low Relationship • Delegating style • Low concern for both tasks and relationships

Action MemoComplete the questionnaire in Leader’s Self-Insight 3.1 to assess your relative

emphasis on two important categories of leadership behavior.

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

Fiedler’s contingency model a model designed to diagnose whether a leader is task-oriented or relationship-oriented and match leader style to the situation

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Leader’s Self-Insight 3.1 T–P Leadership Questionnaire: An Assessment of Style

The following items describe aspects of leadership behavior. Assume you are under great pressure for performance improvements as the leader of a manufac- turing work group of six machine operators. 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 take charge of what should be done and when to do it. _______ _______

2. I would stress getting ahead of competing groups. _______ _______

3. I would ask the members to work harder. _______ _______

4. I would speak for the group if there were visitors present. _______ _______

5. I would keep the work mov- ing at a rapid pace. _______ _______

6. I would permit members to use their own judgment in solving problems. _______ _______

7. I would ask for group feed- back on my ideas. _______ _______

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

9. I would turn the members loose on a job and let them go for it. _______ _______

10. I would permit the group to set its own pace. _______ _______ T _____ P _____ _______ _______

Scoring and Interpretation The T–P Leadership Questionnaire is scored as follows: Your “T” score is the number of Mostly True answers for questions 1–5. Your “P” score is the number of Mostly True answers for questons 6–10. A score of 4 or 5 would be considered high for either T or P.

Some leaders deal with people needs, leaving task details to followers. Other leaders focus on specific details with the expectation that followers will carry out orders. 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 two dimensions of leadership: 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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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 earlier, 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

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68 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

along an eight-point scale. Examples of the bipolar adjectives used by Fiedler on the LPC scale follow:

open guarded

quarrelsome harmonious

efficient inefficient

self-assured hesitant

gloomy 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.

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 confi dence in the leader, leader–member relations are considered good. When subordinates distrust, do not respect, and have little confi dence in the leader, leader–member relations are poor.

Task structure refers to the extent to which tasks performed by the group are defi ned, involve specifi c procedures, and have clear, explicit goals. Routine, well-defi ned tasks, such as those of assembly-line workers, have a high degree of structure. Creative, ill-defi ned tasks, such as research and development or strategic 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.

Combining the three situational characteristics yields a list of eight leader- ship situations, which are illustrated in Exhibit 3.3. Situation I is most favor- able to the leader because leader–member relations are good, task structure is high, and leader position power is strong. Situation VIII is most unfavorable to the leader because leader–member relations are poor, task structure is low, and leader position power is weak. Other octants represent intermediate degrees of favorableness for the leader.

Contingency Theory When Fiedler examined the relationships among leadership style, situational fa- vorability, and group task performance, he found the pattern shown at the top of Exhibit 3.3. Task-oriented leaders are more effective when the situation is either highly favorable or highly unfavorable. Relationship-oriented leaders are more effective in situations of moderate favorability.

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CHAPTER 3: CONTINGENCY APPROACHES 69

The task-oriented leader excels in the favorable situation because everyone 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 defi nes 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.

The relationship-oriented leader performs better in situations of interme- diate 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 relationships, 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 favor- able or unfavorable. Consider the following example of Tom Freston, former CEO of MTV Networks and Viacom, Inc.

Tom Freston, Viacom, Inc.

A few years ago, Tom Freston was regarded as one of the best leaders in the enter- tainment industry. In the fall of 2006, the 26-year company veteran, credited with building MTV into a global powerhouse, was fi red. What went wrong?

One way to look at Freston’s rise and fall is to examine his leadership in terms of Fiedler’s theory. As CEO of MTV Networks and later its parent company Viacom, Freston fostered a relaxed atmosphere and gave people freedom to explore, imagine,

Source: Based on Fred E. Fiedler, “The Effects of Leadership Training and Experience: A Contingency Model Interpretation,” Administrative Science Quarterly 17 (1972), p. 455.

Exhibit 3.3 Fiedler’s Classification: How Leader Style Fits the Situation

Situations

IN T

HE L

EA D

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70 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

and make many of their own decisions. In interviews, he often credited employees for the company’s success rather than taking all the applause for himself. Employ- ees liked Freston’s laid-back approach and appreciated his trust and respect for their judgment. For many years, MTV Networks and Viacom maintained a steady level of success under Freston’s style of leadership.

But things in the media industry have changed dramatically with the emer- gence of Internet startups such as MySpace and YouTube. As the power of these new media outlets mushroomed, MTV began to lose its hip status. Viacom launched its own broadband channels, but they have fared poorly. At the same time, the tra- ditional cable network audience is shrinking, along with advertising dollars. MTV’s 2006 annual Video Music Awards provided the ultimate example of how much things have changed. Despite the show’s serious star power, ratings fell nearly 30 percent from the previous year and nearly 50 percent from two years earlier.

Viacom’s stock price has refl ected the company’s fl agging fortunes. Chairman Sumner Redstone believed something had to be done, and fast. Despite his earlier support of Freston, Redstone convened the Viacom board and got their approval to fi re the unsuspecting CEO. Redstone is now putting his hopes for Viacom’s future on Philippe Dauman, a numbers-oriented former lawyer who says he’s committed to putting the company “on the fast track.”5

Tom Freston might be characterized as using a relationship-oriented style in an unfavorable situation. The environment has grown more challenging, the na- ture of tasks in the media industry is unstructured, and Freson’s personal power

with employees has begun to erode somewhat as the company has grown larger and faced bigger problems. Viacom Chairman Sumner Redstone grew impatient with the lack of results and the slow re- sponse to increased competition, and he felt that Freston’s leadership approach was no longer working. Redstone believed a leader using a more task-oriented style might be able to impose the structure and

discipline needed for the organization to succeed in its current situa- tion. In discussing his appointment as the new CEO, Philippe Dauman said Redstone “told me I was the right guy at the right time.”6 Read the Consider This box for an interesting perspective on the disadvantages of persisting in a behavior style despite the processes of change.

An important contribution of Fiedler’s research is that it goes be- yond the notion of leadership styles to try to show how styles fi t the sit- uation. Many studies have been conducted to test Fiedler’s model, and

the research in general provides some support for the model.7 However, Fiedler’s model has also been criticized.8 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 favorability seem to have been determined in an ar- bitrary 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 signifi cance 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 is matched with an unfavorable situation and is successful the organizational situation is likely to improve and become a situation more appropriate for a relationship- oriented leader.

Finally, Fiedler’s model and much of the subsequent research fails to consider medium LPC leaders, who some studies indicate are more effective than either high or low LPC leaders in a majority of situations.9 Leaders who score in the mid-range on the LPC scale presumably balance the concern for relationships

Action MemoAs a leader, you can effectively use a task-oriented style when the organizational

situation is either highly unfavorable or highly favorable to your leadership. Use a

relationship-oriented style in situations of intermediate favorability because human

relations skills can create a positive atmosphere.

IN T

HE L

EA D

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with a concern for task achievement more effectively than high or low LPC lead- ers, making them more adaptable to a variety of situations.

New research has continued to improve Fiedler’s model,10 and it is still con- sidered an important contribution to leadership studies. However, its major im- pact may have been to stir other researchers to consider situational factors more seriously. A number of other situational theories have been developed in the years since Fiedler’s original research.

Hersey and Blanchard’s Situational Theory The situational theory developed by Hersey and Blanchard is an interesting extension of the leadership grid outlined in Chapter 2. This approach focuses on the charac- teristics of followers as the important element of the situation, and 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 leadership style than those who are high in readiness and have good ability, skills, confi dence, and willingness to work.11

According to the situational theory, a leader can adopt one of four leader- ship 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 3.4 summarizes the relationship between leader style and follower readiness. The upper part of the exhibit indicates the four leader styles: telling, selling, participating, and delegating. The telling style refl ects a high concern for tasks and a low concern for people and relationships. This is a very

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 consequently, of determining effective leader behavior

The phrase “too much of a good thing” is relevant in lead- ership. Behavior that becomes overbearing can be a disad- vantage by ultimately resulting in the opposite of what the individual 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 over-determined 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.

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Consider This!

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72 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

directive style. The leader gives explicit directions about how tasks should be accomplished. The selling style is based on a high concern for both relationships and tasks. With this approach, the leader explains decisions and gives followers a chance to ask questions and gain clarity about work tasks. The participating style is characterized by high relationship and low task behavior. The leader shares ideas with followers, encourages participation, and facilitates decision making. The fourth style, the delegating style, refl ects a low concern for both tasks and re- lationships. This leader provides little direction or support because responsibility for decisions and their implementation is turned over to followers.

The bell-shaped curve in Exhibit 3.4 is called a prescriptive curve because it indicates when each leader style should be used. The readiness level of followers is indicated in the lower part of the exhibit. R1 is low readiness and R4 represents very high readiness. The essence of Hersey and Blanchard’s situational theory is for the leader to diagnose a follower’s readiness and select a style that is appropriate

Exhibit 3.4 Hersey and Blanchard’s Situational Theory of Leadership

TASK BEHAVIOR (Guidance)

FOLLOWER READINESS

LEADER STYLE

(LOW)

(S up

po rt

iv e

B eh

av io

r) R

EL AT

IO N

S H

IP B

EH A

V IO

R (H

IG H

)

(HIGH)

LOWMODERATE

FOLLOWER LEADER

HIGH

Share ideas and facilitate in decision making

Turn over responsibility for decisions and implementation

Able and Willing

or Confident

Unable but Willing

or Confident

Unable and Unwilling

or Insecure

Able but Unwilling

or Insecure

Provide specific instructions and closely supervise performance

Explain decisions and provide opportunity for clarification

S3 S2

R4 R3 R2 R1

DE LE

GA TI

N G

PA R

TI C IP

AT IN

G SELLIN G

TELLING

Source: Paul Hersey, Kenneth Blanchard, and Dewey Johnson, Management of Organizational Behavior: Utilizing Human Resources, 7th ed. (Englewood Cliffs, NJ: Prentice Hall, 1996), p. 200. Used with permission.

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CHAPTER 3: CONTINGENCY APPROACHES 73

for the readiness level, such as their degree of education and skills, experience, self-confi dence, and work attitudes.

Low Readiness Level When one or more followers exhibit very low levels of readiness, the leader has to be very specifi c, “telling” fol- lowers exactly what to do, how to do it, and when. For example, Phil Hagans owns two McDonald’s franchises in northeast Houston and gives many young workers their fi rst 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-confi dence.12

Moderate Readiness Level A selling leadership style works well when followers lack some education and experience for the job but demonstrate confi dence, ability, interest, and willingness to learn. With a selling style, the leader gives some direction but also seeks input from and clarifi es tasks for followers rather than merely instructing how tasks be performed. Kierstin Higgins, founder of Accommodations by Apple, a small company that handles corporate relocations, fi nds the selling style appro- priate for her young employees, who are very energetic and enthusiastic about their jobs but have not yet gained a lot of experience. By seeking their input and clarifying tasks, Higgins believes she helps her workers learn from the chal- lenges they face rather than being frustrated by them.13

High Readiness Level A participating style can be effective when followers have the necessary education, skills, and experience, but they might be insecure in their abilities and need some guidance from the leader. The leader can guide followers’ 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 fi gure out the best way to meet it.14

Very High Readiness Level The delegating style of leadership can be effectively used when followers have very high levels of education, experience, and readiness to accept responsibility for their own task behavior. The leader provides a general goal and suffi cient authority to do the tasks as followers see fi t. Highly educated pro- fessionals such as lawyers, college professors, and social workers would typically fall into this category. There are followers in almost every organization who demonstrate high readiness. For example, many fast-food outlets have had great success hiring retirees for part- time jobs. These older employees often have high levels of readiness because of their vast experience and positive attitudes, and leaders can effectively use a delegating style.

In summary, the telling style works best for followers who demon- strate very low levels of readiness to take responsibility for their own task behavior, the selling and participating styles are effective for followers with moderate-to- high readiness, and the delegating style is appropriate for employees with very high readiness.

This contingency model is easier to understand than Fiedler’s model be- cause it focuses only on the characteristics of followers, not those of the larger

Action M emo

As a leade r, you can

act as a re source

to provide advice an

d assistan ce when

followers have a hig

h level of skill,

experience , and resp

onsibility. Delegate

responsibi lity for dec

isions and their

implemen tation to f

ollowers w ho have ve

high levels of skill an

d positive attitudes.

Action M emo

As a leade r, you can

tell follow ers how to

perform th eir tasks if

they have few skills

little expe rience, or

low self-c onfi dence.

followers have a mo

derate deg ree of skil

and show enthusiasm

and willin gness to

learn, prov ide directi

on but see k follower

s’

input and explain yo

ur decision s.

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situation. The leader should evaluate subordinates and adopt whichever style is needed. The leader’s style can be tailored 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 specifi c, telling exactly what to do, how to do it, and when. For a follower high in readiness, the leader provides a general goal and

suffi cient authority to do the task as the follower sees fi t. Leaders can carefully diagnose the readiness level of followers and then tell, sell, participate, or delegate.

Classroom teachers face one of the toughest leadership challenges around because they usually deal with students who are at widely dif-

ferent levels of readiness. Consider how Carole McGraw of the Detroit, Michigan, school system met the challenge.

Carole McGraw, Detroit Public Schools

Carole McGraw describes what she sees when she walks into a classroom for the fi rst time: “A ubiquitous sea of easily recognizable faces. There’s Jamie, whose eyes glow with enthusiasm for learning. And Terrell, who just came from the crib after having no breakfast, no supervision of his inadequate homework, and a chip on his shoulder because he needed to fl ip hamburgers ‘til 10 o’clock at night. . . . And Matt,

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Action MemoAnswer the questions in Leader’s Self- Insight 3.2 to determine your own readiness

level and the style of leadership that would be most appropriate for you as a follower.

Are You Ready? Leader’s Self-Insight 3.2

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 below is Mostly False or Mostly True for you in that job.

Mostly False

Mostly True

1. I typically do the exact work requ- ired 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 when- ever 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 follower’s readiness, the more participative and del- egating 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 suggest 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 readiness levels.

G et

ty Im

ag es

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CHAPTER 3: CONTINGENCY APPROACHES 75

who slumps over his desk, fast asleep from the Ritalin he took for a learning disorder that was probably misdiagnosed to correct a behavior problem. . . .” And on and on.

McGraw diagnosed what teenagers have in common to fi nd the best way to help students of such varying degrees of readiness learn. She realized that teenagers are exposed to countless hours of social networking Web sites, televi- sion programs, CDs, and disc jockeys. They spend a lot of time playing sports, eating junk food, talking on the phone, playing computer games, going to the movies, read- ing pop magazines, hanging out with peers, and avoiding adults. After considering this, McGraw developed her teaching method focused on three concepts: painless, interesting, and enjoyable. Students in McGraw’s biology class now do almost all of their work in labs or teamwork sessions. During the labs, a captain is selected to act as team leader. In teams, students select a viable problem to investigate and then split up the work and conduct research in books, on the Internet, and in laboratory experiments. Teams also spend a lot of time engaged in dialogue and brainstorming. McGraw will throw out an idea and let the students take off with it.

McGraw’s teaching method combines telling and participating. Students are pro- vided with direction about certain concepts, vocabulary words, and so forth that they must master, along with guidelines for doing so. This provides the structure and dis- cipline some of her low-readiness level students need to succeed. However, most of her leadership focuses on supporting students as they learn and grow on their own. Does McGraw’s innovative approach work? Sixty percent of the students get a grade of A and all score fairly well on objective tests McGraw gives after the teamwork is complete. Students from her classes score great on standardized tests like the SAT because they not only accumulate a lot of knowledge but also gain self-confi dence and learn how to think on their feet. “All the stress my kids lived with for years disappears,” McGraw says. “My classroom buzzes with new ideas and individual approaches.”15

Path–Goal Theory Another contingency approach to leadership is called the path–goal theory.16

According to the path–goal theory, the leader’s responsibility is to increase subor- dinates’ motivation to attain personal and organizational goals. 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 clarifi cation means that the leader works with subordinates to help them identify and learn the behaviors that will lead to suc- cessful task accomplishment and organizational rewards. Increasing rewards means that the leader talks with subordinates to learn which rewards are important to them—that is, whether they desire intrinsic rewards from the work itself or extrin- sic 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.17

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 followers’ needs.18 Whereas the Fiedler theory made the assumption that new leaders could take over as situations change, in the path–goal theory, leaders change their be- haviors to match the situation.

Leader Behavior The path–goal theory suggests a fourfold classifi cation of leader be- haviors.19 These classifi cations are the types of behavior the leader can

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

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Action M emo

As a leade r, you can

increase f ollower

motivation , satisfact

ion and pe rformance

by adoptin g a leader

ship behav ior that

will clarify the follow

er’s path t o receiving

available r ewards or

increase t he

availabilit y of rewar

ds the foll ower desi

res.

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76 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

adopt and include supportive, directive, achievement-oriented, and participative styles.

Supportive leadership shows concern for subordinates’ well-being and per- sonal needs. Leadership behavior is open, friendly, and approachable, and the leader creates a team climate and treats subordinates as equals. Supportive lead- ership is similar to the consideration or people-oriented leadership described earlier.

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. Direc- tive leadership behavior is similar to the initiating structure or task-oriented lead- ership 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 par- ticipative leader encourages group discussion and written suggestions, similar to the selling or participating 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 confi dence in sub- ordinates and assist them in learning how to achieve high goals.

Exhibit 3.5 Leader Roles in the Path–Goal Model

Path Clarification Increase Rewards

Leader defines what follower must do to attain work outcomes

Leader clarifies follower’s work role

Follower has increased knowledge and confidence to accomplish outcomes

Follower displays increased effort and motivation

Organizational work out- comes are accomplished

Leader learns follower’s needs

Leader matches follower’s needs to rewards if work outcomes are accomplished

Leader increases value of work outcomes for follower

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CHAPTER 3: CONTINGENCY APPROACHES 77

To illustrate achievement-oriented leadership, consider the training of army offi cers in the Reserve Offi cers’ Training Corps (ROTC). This training goes far beyond how to command a platoon. It involves the concepts of motivation, re- sponsibility, and the creation of a team in which decision making is expected of everyone. Fundamentally, this training will enable offi cers to respond to any situa- tion, not just those outlined in the manual. Thus achievement-oriented leadership is demonstrated: The set goals are challenging, require improvement, and demon- strate confi dence in the abilities of subordinates.20

The four types of leader behavior are not considered ingrained personality traits as in the earlier trait theories; rather, they refl ect types of behavior that every leader is able to adopt, depending on the situation.

Situational Contingencies The two important situational contingencies in the path–goal theory are (1) the personal characteristics of group members and (2) the work environment. Per- sonal characteristics of followers are similar to Hersey and Blanchard’s readi- ness 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 additional training or coaching in order for the worker to improve performance. If a subordinate is self-centered, the leader may use monetary re- wards 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 participative 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 the extent to which tasks are defi ned and have explicit job descriptions and work procedures. The formal authority system includes the amount of legiti- mate power used by leaders and the extent to which policies and rules constrain employees’ behavior. Work-group characteristics consist of the educational level of subordinates 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 of rewards to enhance satisfaction and job performance. In some situations, the leader works with subordinates to help them acquire the skills and confi dence needed to perform tasks and achieve rewards already avail- able. In others, the leader may develop new rewards to meet the specifi c needs of subordinates.

Exhibit 3.6 illustrates four examples of how leadership behavior is tailored to the situation. In the fi rst situation, the subordinate lacks confi dence; thus, the supportive leadership style provides the social support with which to encour- age 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 clari- fi es the path to rewards for the employee. In the fourth situation, an incorrect reward is given to a subordinate, and the participative leadership style is used to

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78 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Exhibit 3.6 Path–Goal Situations and Preferred Leader Behaviors

OutcomeLeader Behavior Impact on FollowerSituation

Follower lacks self-confidence

Ambiguous job

Lack of job challenge

Incorrect reward

Increases confidence to achieve work outcome

Clarifies path to reward

Sets and strives for parallel structure

Clarifies followers’ needs to change rewards

Increased effort; improved satisfaction and performance

Supportive Leadership

Directive Leadership

Achievement- Oriented Leadership

Participative Leadership

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 outcome of fi t- ting the leadership behavior to the situation produces greater employee effort by either clarifying how subordinates can receive rewards or changing the rewards to fi t their needs.

At The Home Depot, former CEO Bob Nardelli reinvigorated employee morale—and retail sales—with his achievement-oriented leadership, which cascades down from headquarters to the store level.

Bob Nardelli, The Home Depot

When Bob Nardelli took over as CEO of The Home Depot, one of his fi rst moves was to impose high goals for everyone from headquarters down to the store level. By doing so, he turned a retail chain where employees were becoming complacent and bored into a company full of enterprising people who thrive on challenge, responsibility, and recognition.

Many low-performing store managers, who were accustomed to a more relaxed approach, left the company. Nardelli slowly began building a cadre of talented people, from top to bottom, and instituting a “no-bull performance culture” that gave people challenging goals and generous rewards for achieving them. Rigorous talent assess- ments, new approaches to hiring, new performance measurement systems, and pro- grams such as the Store Leadership Program and Accelerated Leadership Program enhanced employee skills and reduced turnover. Nardelli monitored stores in real time via computer, and he spent 1 week a quarter as a “mystery shopper,” popping in unannounced to as many as 10 stores a day.

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CHAPTER 3: CONTINGENCY APPROACHES 79

Nardelli’s achievement-oriented leadership worked. Within fi ve years, sales grew from $45.7 billion to around $80 billion, earnings per share increased by 20 percent annually, and the retailer gained an edge in lucrative new segments, such as the $410 billion professional construction market. “His real ability,” says Jack Welch, who was Nardelli’s boss at General Electric, “is to motivate lots of people around a mission, excite them about it, and make it happen.”21

Bob Nardelli’s achievement-oriented leadership encouraged every manager in the organization to focus on keeping people challenged and motivated to reach goals. Despite Nardelli’s success increasing sales and profi ts at the retail chain, however, Home Depot’s stock price did not increase. Unhappy share- holders, concerns over Nardelli’s huge pay package, his refusal to tie his stock awards to shareholder gains, and growing resentment over Nardelli’s often brusque approach led Nardelli and the board to mutually agree that he would resign in early 2007.22 Nardelli’s rise and abrubt fall at The Home Depot pro- vides a good example of how an achievement-oriented leader can drive positive internal performance but still face external dissatisfaction in today’s corporate environment.

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 predictions about employee outcomes may be diffi cult, but the four types of leader behavior and the ideas for fi tting 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 signifi cant ways as well. This model focuses specifi cally on varying degrees of participative leadership, and how each level of participa- tion infl uences 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 precisely the correct amount of participation by subordinates to use in making a particular decision.24 The model has three major components: leader participa- tion styles, a set of diagnostic questions with which to analyze a decision situa- tion, and a series of decision rules.

Leader Participation Styles The model employs fi ve 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 fi ve 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

Vroom–Jago contingency model a contingency model that focuses on varying degrees of participative leadership, and how each level of participation infl uences quality and accountability of decisions.

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80 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

(Delegate). The fi ve 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 fi ve decision styles to use? The appropri- ate 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 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 organization? 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 carrying 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.

Exhibit 3.7 Five Leader Decision Styles

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.

Decide Consult Individually

Consult Group Facilitate Delegate

You make the decision alone and either announce or “sell” it to the group. You may use your expertise in collecting information that you deem relevant to the problem from the group or others.

You present the problem to the group members individually, get their suggestions, and make the decision.

You present the problem to the group members in a meeting, get their suggestions, and then make the decision.

You present the problem to the group in a meeting. You act as facilitator, defining the problem to be solved and the boundaries within which the decision must be made. Your objective is to get concurrence on a decision. Above all, you take care to show that your ideas are not given any greater weight that those of others simply because of your position.

You permit the group to make the decision within prescribed limits. The group undertakes the identification and diagnosis of the problem, developing alternative procedures for solving it, and deciding on one or more alternative solutions. While you play no direct role in the group's deliberations unless explicitly asked, your role is an improtant one behind the scenes, providing needed resources and encouragement.

Area of Influence by Leader Area of Freedom for Group

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CHAPTER 3: CONTINGENCY APPROACHES 81

4. Likelihood of commitment: If the leader were to make the decision alone, would subordinates have high or low commitment to the decision? If subordinates typically go along with whatever the leader decides, their involvement in the decision-making process will be less important.

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 relation 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 responsibility 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 par- ticipation in decision making.

Selecting a Decision Style Further development of the Vroom–Jago model added concern for time con- straints and concern for follower development as explicit criteria for determin- ing 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 effi - ciency are less important criteria 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 muffl ers. 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 im- mediately to get the production line moving 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 importance 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 time- based model and a development-based model—that enables leaders to adopt a participation style by answering the diagnostic questions in sequence. Returning to the example of the welding machine, if the ma- chine has broken down and must be replaced immediately, the leader would follow the time-based model in Exhibit 3.8. The leader enters the matrix at the left side, at Problem Statement, and considers the seven situational questions in sequence from left to right, answering high (H) or low (L) to each one and avoiding crossing any horizontal lines.

Action M emo

As a leade r, you can

use the Vr oom–Jago

model to d etermine t

he approp riate amou

of followe r participa

tion to use in making

a decision . You can f

ollow the time-base

guidelines when tim

e is of the essence,

but

use devel opment-ba

sed guidel ines when

cultivating followers

’ decision- making sk

ills

is also imp ortant.

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82 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Exhibit 3.8 Time-Driven Model for Determining an Appropriate Decision-Making Style—Group Problems

Li ke

lih oo

d of

Co m

m itm

en t?

Decide

Delegate

Consult (Group)

Facilitate

Consult (Individually)

Facilitate

Consult (Group)

Decide

Facilitate

Consult (Individually)

Decide

Delegate

Facilitate

Decide

D ec

is io

n Si

gn if

ic an

ce ?

Im po

rt an

ce o

f Co

m m

itm en

G ro

Su pp

or t?

G ro

up Ex

pe rt

is e?

Te am

m pe

te nc

H H

L L

P R O B L E M

S T A T E M E N T

Le ad

Ex pe

rt is

Instructions: The matrix operates like a funnel. You start at the left with a specific decision problem in mind. The column headings denote situational factors which may or may not be present in that problem. You progress by selecting High or Low (H or L) for each relevant situational factor. Proceed down from the funnel, judging only those situational factors for which a judgment is called for, until you reach the recom- mended process.

Source: Victor H. Vroom, “Leadership and the Decision Making Process,” Organizational Dynamics 28, no. 4 (Spring 2000), pp. 82–94.

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CHAPTER 3: CONTINGENCY APPROACHES 83

The fi rst question would be: How signifi cant is this decision for the project or organization? If the answer is High, the leader proceeds to importance of commit- ment: How important is subordinate commitment to carrying out the decision? If the answer is High, the next question pertains to leader expertise: What is the level of the leader’s expertise in relation to the problem? If the leader’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 subordinates would be committed to the decision? If there is a high likelihood that subordinates would be committed, the deci- sion 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 effi ciency 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 con- sidered follower development of high importance and time of little concern. In this case, the leader would follow the development-driven decision matrix in

Exhibit 3.9 Development-Driven Model for Determining an Appropriate Decision-Making Style—Group Problems

Delegate

Facilitate

Consult (Group)

Delegate

Facilitate

Consult (Group)

Delegate

Facilitate

Consult (Group)

Decide

Delegate

Decide

P R O B L E M

S T A T E M E N T

D ec

is io

n S

ig ni

fic an

ce ?

Im po

rt an

ce o

f C

om m

itm en

Le ad

er E

xp er

tis e?

Li ke

lih oo

d of

om m

itm en

G ro

S up

po rt

G ro

E xp

er tis

Te am

om pe

te nc

H H

Source: Victor H. Vroom, “Leadership and the Decision Making Process,” Organizational Dynamics 28, no. 4 (Spring 2000), pp. 82–94.

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84 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Exhibit 3.9. Beginning again at the left side of the matrix: How signifi cant is this de- cision for the project or organization? If the answer is High, proceed to importance of commitment: How important is subordinate commitment? If high, the next ques- tion 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 likeli- hood, 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 time-driven model takes the leader to the fi rst decision style that preserves decision quality and follower acceptance, whereas the development- driven model takes other considerations into account. It takes less time to make an autocratic decision (Decide) than to involve subordinates by using a Facilitate or Delegate style. However, in many cases, time and effi ciency are less important than the opportunity to further subordinate development. In many of today’s organizations, where knowledge sharing and widespread participation are con- sidered 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 fi t the situation. However, researchers have also developed a computer-based program that allows for greater complexity and precision in the Vroom–Jago model and incorporates 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 body of supportive research is growing.27

Leaders can learn to use the model to make timely, high-quality decisions. Let’s try applying the model to the following problem.

Dave Robbins, Whitlock Manufacturing

When Whitlock Manufacturing won a contract from a large auto manufacturer to produce an engine to power its fl agship sports car, Dave Robbins was thrilled to be selected as a project manager. The engine, of Japanese design and extremely com- plex, 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.

Robbins and his team of engineers have taken great pride in their work on the project, but their excitement was dashed by a recent report of serious engine prob- lems in cars delivered to customers. Fourteen owners of cars produced during the fi rst month have experienced engine seizures. Taking quick action, the auto manu- facturer suspended sales of the sports car, halted current production, and notifi ed 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.

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CHAPTER 3: CONTINGENCY APPROACHES 85

As the person most knowledgeable about the engine, Robbins has spent two weeks in the fi eld 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, Robbins 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 pos- sible in making decisions and solving problems. He not only values their input, but thinks that by encouraging greater participation he strengthens the thinking skills of team members, helping them grow and contribute more to the team and the organi- zation. Therefore, Robbins chooses to consult with his team before making his fi nal decision. The group meets for several hours that afternoon, discussing the problem in detail and sharing their varied perspectives, including the information Robbins has gathered during his research. Following the group session, Robbins makes his deci- sion. 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 time-driven or a development- driven decision tree can be used to select a decision style. Although time is of importance, a leader’s desire to involve subordinates can be considered equally important. Do you think Robbins used the correct leader decision style? Let’s examine the problem using the development-based decision tree, since Robbins is concerned about involving other team members. Moving from left to right in Exhibit 3.9, the questions and answers are as follows: How signifi cant is this decision for the organization? Defi nitely high. Quality of the decision is of critical importance. The company’s future may be at stake. How important is subordi- nate commitment to carrying out the decision? Also high. The team members must support and implement Robbins’s solution. If Robbins 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 Robbins, 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? Defi nitely high. This 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, Robbins used the style that would be recommended by the Vroom–Jago model.

Now, assume that Robbins chose to place more emphasis on time than on participant involvement and development. Using the time-based decision matrix in Exhibit 3.8, trace the questions and answers based on the information just provided and rate Robbins’s level of expertise as high. Remember to avoid cross- ing any horizontal lines. What decision style is recommended? Is it the same or different from that recommended by the development-based tree?

Substitutes for Leadership The contingency leadership approaches considered so far have focused on the leader’s style, the follower’s nature, and the situation’s characteristics. The fi nal contingency approach suggests that situational variables can be so powerful that they actually substitute for or neutralize the need for leadership.29 This approach outlines those organizational settings in which task-oriented and people-oriented leadership styles are unimportant or unnecessary.

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86 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Exhibit 3.10 shows the situational variables that tend to substitute for or neutralize leadership characteristics. A substitute for leadership makes the leadership style unnecessary or redundant. For example, highly educated, professional subor- dinates 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

A neutralizer counteracts the leadership style and prevents the leader from dis- playing certain behaviors. For example, if a leader is physically removed from subordinates, the leader’s ability to give directions to subordinates is greatly re- duced. Kinko’s, a nationwide copy center, includes numerous locations widely scattered across regions. Regional managers enjoy very limited personal interac- tion due to the distances between stores. 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 com- panies like Merck or Monsanto, both leadership styles are less important. The employees do not need either direction or support. With respect to task characteristics, highly structured tasks substitute 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. Satisfi ed 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 traffi c controllers and jet fi ghter pilots is characterized by high- stress interactions and continuous peer training. This cohesiveness

provides support and direction that substitutes for formal leadership.31

Formalized rules and procedures substitute for leader task orientation because the rules tell people what to do. Physical separation of leader and subordinate neutralizes 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

Substitute a situational variable that makes leadership unnecessary or redundant

Neutralizer a situational characteristic that counteracts the leadership style and prevents the leader from displaying certain behaviors

Action MemoAs 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.

Exhibit 3.10 Substitutes and Neutralizers for Leadership

Task-Oriented People-Oriented Variable Leadership Leadership

Organizational Group cohesiveness Substitutes for Substitutes for variables: Formalization Substitutes for No effect on Inflexibility Neutralizes No effect on Low positional power Neutralizes Neutralizes Physical separation Neutralizes Neutralizes

Task Highly structured task Substitutes for No effect on characteristics: Automatic feedback Substitutes for No effect on Intrinsic satisfaction No effect on Substitutes for

Follower Professionalism Substitutes for Substitutes for characteristics: Training/experience Substitutes for No effect on Low value of rewards Neutralizes Neutralizes

Action MemoMeasure how the task characteristics 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.

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with which to complement the organizational situation. For example, the work situation for bank tellers provides a high level of formalization, little fl exibility, 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 behaviors. The leader can adopt a style complementary to the organizational situation to ensure that both task needs and people needs of followers are met. Leadership overkill can help to explain the problems Lawrence Summers encountered as president of Harvard University.

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.

TASK STRUCTURE

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 instruc- tion. _______ _______

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. _______ _______

TASK FEEDBACK 5. After I’ve completed a task,

I can tell right away from the results I get whether I have per- formed 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 some- thing exceptionally well. _______ _______

Leader’s Self-Insight 3.3 INTRINSIC SATISFACTION

8. I get lots of satisfaction from the work I do. _______ _______

9. It is hard to imagine that any- one could enjoy performing the tasks I have performed on my job. _______ _______

10. My job satisfaction depends primarily 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 Satisfaction: _____

A high score (3 or 4) for Task Structure or Task Feedback 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 substitute 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.

Measuring Substitutes for Leadership G et

ty Im

ag es

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88 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Lawrence H. Summers, Harvard University

Leading a major university has many challenges, and one of the biggest is choosing the right approach with deans, faculty members, and other professionals who are highly educated, independent, and often perform their jobs as much for the intrinsic satisfaction of the work as for the pay and other extrinsic benefi ts.

As president of Harvard University, former U.S. Treasury Secretary Lawrence Summers tried to use a heavy, primarily task-oriented style of leadership, which led to serious confl icts with some faculty members and eventual demands for his ouster. The assertive top-down style rankled followers who have been accustomed to thinking of themselves not as employees but as partners in an academic enter- prise. Faculty members at Harvard, as at many universities, have long been used to decentralized, democratic decision making, such as having a say in matters such as department mergers or new programs of study. Summers made many decisions on his own that followers thought should be put to a faculty vote and then used a directive style to get things done.

Although students in general supported Summers, the confl icts and a vote of no-confi dence from some faculty convinced Summers to resign with many of his goals and plans for the university unrealized. There are a variety of reasons for Sum- mers’ troubles and eventual departure, but his heavy-handed task-oriented approach likely played a role.32

Lawrence Summers infuriated some Harvard faculty members by failing to appreciate the substitutes for leadership concept. In this situation, professionalism, education, and intrinsic satisfaction make both task- and people-oriented leadership behavior less impor- tant. Summers likely would have been more successful using a light- handed, primarily people-oriented style.

Recent 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 alternatives. 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’ promotion to middle management, his group no lon- ger 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 utilize substitutes to fi ll leadership “gaps” is often advantageous to organizations. Indeed, the fundamental assumption of substitutes-for-leadership researchers is that effective leadership

is the ability to recognize and provide the support and direction not already provided by task, group, and organization.

Summary and Interpretation The most important point in this chapter is that situational variables affect lead- ership outcomes. The contingency approaches were developed to systematically address the relationship between a leader and the organization. The contingency

Action MemoAs 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 followers’ intrinsic job satisfaction meet their social

and emotional needs.

Action MemoAs 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.

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CHAPTER 3: CONTINGENCY APPROACHES 89

approaches focus on how the components of leadership style, subordinate charac- teristics, and situational elements impact one another. Fiedler’s contingency model, Hersey and Blanchard’s situational theory, the path–goal theory, the Vroom–Jago model, and the substitutes-for-leadership concept each examine how different situations call for different styles of leadership behavior.

According to Fiedler, leaders can determine whether the situation is favorable to their leadership style. Task-oriented leaders tend to do better in very easy or very diffi cult situations, whereas relationship-oriented leaders do best in situa- tions of intermediate favorability. Hersey and Blanchard contend that leaders can adjust their task or relationship style to accommodate the readiness level of their subordinates. The path–goal theory states that leaders can use a style that appro- priately clarifi es 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 requirement, or the leader’s information. In addition, concern for time (the need for a fast decision) versus concern for fol- lower development are taken into account. Leaders can analyze each situation and answer a series of questions that help determine the appropriate level of fol- lower participation. 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 lead- ership outcomes. Therefore, effective leadership is about developing diagnostic skills and being fl exible in your leadership behavior.

Discussion Questions

1. Consider Fiedler’s theory as illustrated in Exhibit 3.3. 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 flexible and adaptable? 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 simi- larities and differences? Which do you prefer?

5. If you were a first-level supervisor of a team of telemarketers, how would you go about asessing 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 effi- cient way to reach the decision? Should leaders sometimes let people participate for other reasons?

8. Consider the situational characteristics of group cohesiveness, organizational formal- ization, and physical separation. How might each of these substitute for or neutralize task-oriented or people-oriented leadership? Explain.

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90 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

Leadership at Work

Task Versus Relationship Role Play You are the new distribution manager for French Grains Bakery. Five drivers report to you that deliver French Grains baked goods to grocery stores in the metropolitan area. The drivers 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 inventory 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, but sometimes is 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 Report. 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 man- ager. 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 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 effectiveness 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 (Kendall Hunt Publishing Company, 1990), pp. 69–72.

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 participative 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 were 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

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CHAPTER 3: CONTINGENCY APPROACHES 91

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 con- ducted 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 appoint- ment to meet with the quality control manager. Quality problems had increased after the new equipment 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 spokesman 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?

Source: Reprinted with permission from Gary Yukl, Leadership in Organizations, Fourth Edition (Englewood Cliffs, NJ: Prentice Hall, 1998), pp. 147–148.

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 participative management.

3. If you were Kevin McCarthy, what would you do now? Why?

Finance Department Ken Osborne stared out the window, wondering what he could do to get things back on track. When he became head of the finance department of a state government agency, Osborne inherited a group of highly trained professionals who pursued their jobs with energy and enthusiasm. Everyone seemed to genuinely love coming to work every day. The tasks were sometimes mundane, but most employees liked the structured, routine nature of the work. In addition, the lively camaraderie of the group provided an element of fun and excitement that the work itself sometimes lacked.

Ken knew he’d had an easy time of things over the last couple of years—he had been able to focus his energies on maintaining relationships with other departments and agen- cies and completing the complex reports he had to turn in each month. The department

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92 PART 2: RESEARCH PERSPECTIVES ON LEADERSHIP

practically ran itself. Until now. The problem was Larry Gibson, one of the department’s best employees. Well-liked by everyone in the department, Gibson had been a key con- tributor to developing a new online accounting system, and Ken was counting on him to help with the implementation. But everything had changed after Gibson attended a professional development seminar at a prestigious university. Ken had expected him to come back even more fired up about work, but lately Larry was spending more time on his outside professional activities than he was on his job. “If only I’d paid more atten- tion when all this began,” Ken thought, as he recalled the day Larry asked him to sign his revised individual development plan. As he’d done in the past, Ken had simply chat- ted with Larry for a few minutes, glanced at the changes, and initialed the modification. Larry’s revised plan included taking a more active role in the state accountants’ society, which he argued would enhance his value to the agency as well as improve his own skills and professional contacts.

Within a month, Ken noticed that most of Gibson’s energy and enthusiasm seemed to be focused on the society rather than the finance department. On “first Thursday,” the society’s luncheon meeting day, Larry spent most of the morning on the phone notifying people about the monthly meeting and finalizing details with the speaker. He left around 11 a.m. to make sure things were set up for the meeting and usually didn’t return until close to quitting time. Ken could live with the loss of Gibson for one day a month, but the preoccupation with society business seemed to be turning his former star employee into a part-time worker. Larry shows up late for meetings, usually doesn’t participate very much, and seems to have little interest in what is going on in the department. The new accounting system is floundering because Larry isn’t spending the time to train people in its effective use, so Ken is starting to get complaints from other departments. Moreover, his previously harmonious group of employees is starting to whine and bicker over minor issues and decisions. Ken has also noticed that people who used to be hard at work when he arrived in the mornings seem to be coming in later and later every day.

“Everything’s gone haywire since Larry attended that seminar,” Ken brooded. “I thought I was one of the best department heads in the agency. Now, I realize I haven’t had to provide much leadership until now. Maybe I’ve had things too easy.”

Source: Based on David Hornestay, “Double Vision,” Government Executive (April 2000), pp. 41–44.

QUESTIONS

1. Why had Ken Osborne’s department been so successful even though he has provided little leadership over the past two years?

2. How would you describe Osborne’s current leadership style? Based on the path–goal theory, which style do you think he might most effectively use to turn things around with Larry Gibson?

3. If you were in Osborne’s position, describe how you would evaluate the situation and handle the problem.

References 1 Leigh Buchanan, “Pat McGovern . . . For Knowing the Power of

Respect,” segment in “25 Entrepreneurs We Love,” Inc Magazine 25th Anniversary Issue (April 2004), pp. 110–147; Stephen Power, “Aggressive Driver: Top Volkswagen Executive Tries U.S.- Style Turnaround Tactics; Blunt-Talking Mr. Bernhard Rankles Charman, Union,” The Wall Street Journal (July 18, 2006), p. A1.

2 “International Data Group Named ‘One of the Best Places to Work’; IDG Honored for Second Straight Year,” Boston Business Journal award, Business Wire (June 23, 2006), p. 1; and “IDG Executives Honored for Their Influence and Innovation in Publishing; IDG Publications Receive Nearly Two Dozen Awards in 2004,” Business Wire (June 7, 2004), p. 1.

3 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.

4 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).

5 Matthew Karnitschnig, “Ouster of Viacom Chief Reflects Redstone’s Impatience for Results,” The Wall Street Journal

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CHAPTER 3: CONTINGENCY APPROACHES 93

(September 6, 2006), pp. A1, A16; “Matthew Karnitschnig and Brooks Barnes, “Does MTV Still Rock? Freston Firing Sparks Soul-Searching at Network,” The Wall Street Journal (September 7, 2006), pp. B1, B3; and Bill Carter, “He’s Cool, He Keeps MTV Sizzling, and, Oh Yes, He’s 56,” The New York Times (June 16, 2002), Section 3, p. 1.

6 Karnitschnig, “Ouster of Viacom Chief Reflects Redstone’s Impatience.” 7 M. J. Strube and J. E. Garcia, “A Meta-Analytic Investigation

of Fiedler’s Contingency Model of Leadership Effectiveness,” Psychological 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.

8 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; 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.

9 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.

10 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.

11 Paul Hersey and Kenneth H. Blanchard, Management of Organizational Behavior: Utilizing Human Resources, 4th ed. (Englewood Cliffs, NJ: Prentice-Hall, 1982).

12 Jonathan Kaufman, “A McDonald’s Owner Becomes a Role Model for Black Teenagers,” The Wall Street Journal (August 23, 1995), pp. A1, A6.

13 Michael Barrier, “Leadership Skills Employees Respect,” Nation’s Business (January 1999).

14 Cheryl Dahle, “Xtreme Teams,” Fast Company (November 1999), pp. 310–326.

15 Carole McGraw, “Teaching Teenagers? Think, Do, Learn,” Education Digest (February 1998), pp. 44–47.

16 M. G. Evans, “The Effects of Supervisory Behavior on the Path–Goal Relationship,” Organizational Behavior and Human Performance 5 (1970), pp. 277–298; M. G. Evans, “Leadership and Motivation: A Core Concept,” Academy of Management Journal 13 (1970), pp. 91–102; and B. S. Georgopoulos, G. M. Mahoney, and N. W. Jones, “A Path–Goal Approach to Productivity,” Journal of Applied Psychology 41 (1957), pp. 345–353.

17 Robert J. House, “A Path–Goal Theory of Leadership Effectiveness,” Administrative Science Quarterly 16 (1971), pp. 321–338.

18 M. G. Evans, “Leadership,” in Organizational Behavior, ed. S. Kerr (Columbus, OH: Grid, 1974), pp. 230–233.

19 Robert J. House and Terrence R. Mitchell, “Path–Goal Theory of Leader- ship,” Journal of Contemporary Business (Autumn 1974), pp. 81–97.

20 Dyan Machan, “We’re Not Authoritarian Goons,” Forbes (October 24, 1994), pp. 264–268.

21 Jennifer Reingold, “Bob Nardelli Is Watching,” Fast Company (December 2005), pp. 76–83.

22 Brian Grow, with Dean Foust, Emily Thornton, Roben Farzad, Jena McGregor, and Susan, “Out at Home Depot,” Business Week (January 15, 2007), p. 56ff.

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 (Englewood Cliffs, 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 Management 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 Performance 22 (1978), pp. 375–403; and Jon P. Howell and Peter W. Dorfman, “Leadership and Substitutes for Leadership Among Professional 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 Leadership,” Organizational Dynamics (Summer 1990), pp. 21–38.

31 Howell, et al., “Substitutes for Leadership: Effective Alternatives to Ineffective Leadership.”

32 Robert Tomsho and John Hechinger, “Crimson Blues; Harvard Clash Pits Brusque Leader Against Faculty,” The Wall Street Journal (February 18, 2005), pp. A1, A8; and Ruth R. Wisse, “Cross Country; Coup d’Ecole,” The Wall Street Journal (February 23, 2006), p. A17.

33 P. M. Podsakoff, S. B. MacKenzie, and W. H. Bommer, “Transformational 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.”

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