2. chapter fourteen
Leadership
McGraw-Hill/Irwin
Contemporary Management, 5/e
Copyright © 2008 The McGraw-Hill Companies, Inc. All rights reserved.

3. Learning Objectives
• Explain what leadership is, when leaders are
effective and ineffective, and the sources of
power that enable managers to be effective
leaders.
• Identify the traits that show the strongest
relationship to leadership, the behaviors
leaders engage in, and the limitations of the
trait and behavioral models of leadership.
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4. Learning Objectives
• Explain how contingency models of leadership
enhance our understanding of effective
leadership and management in organizations.
• Describe what transformational leadership is,
and explain how managers can engage in it.
• Characterize the relationship between gender
leadership.
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5. The Nature of Leadership
• Leadership
– The process by which a person exerts
influence over others and inspires,
motivates and directs their activities to
achieve group or organizational goals.
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6. Question?
What is an individual who is able to exert
influence over other people to help
achieve group or organizational goals?
A. Manager
B. Leader
C. Chief
D. Organizer
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7. The Nature of Leadership
• Leader
– An individual who is able to exert influence
over other people to help achieve group or
organizational goals
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8. The Nature of Leadership
• Personal Leadership Style
– The specific ways in which a manager
chooses to influence others shapes the way
that manager approaches the other principal
tasks of management.
– The challenge is for managers
at all levels to develop an
effective personal management
style.
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9. The Nature of Leadership
• Distinction between managers and leaders
– Managers establish and implement
procedures to ensure smooth functioning
– Leaders look to the future and chart the
course for the organization
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10. Leadership Across Cultures
• Leadership styles may vary among
different countries or cultures.
– European managers tend to be more
people-oriented than American or Japanese
managers.
– Japanese managers are group-oriented,
while U.S managers focuses more on
profitability.
– Time horizons also are affected by cultures.
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11. Sources of Managerial Power
Figure 14.1
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12. Power: The Key to Leadership
• Legitimate Power
– The authority that a manager has by virtue
of his or her position in the firm.
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13. Power: The Key to Leadership
• Reward Power
– The ability of a manager to give or withhold
tangible and intangible rewards.
– Effective managers use reward power to
signal to employees that they are doing a
good job.
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14. Power: The Key to Leadership
• Coercive Power
– The ability of a manager to punish others.
• Examples: verbal reprimand, pay cuts,
and dismissal
• Limited in effectiveness and application;
can have serious negative side effects.
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15. Power: The Key to Leadership
• Expert Power
– Power that is based on special knowledge,
skills, and expertise that the leader
possesses.
– Tends to be used in a guiding or coaching
manner
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16. Power: The Key to Leadership
• Referent Power
– Power that comes from subordinates’ and
coworkers’ respect , admiration, and loyalty
– Possessed by managers who are likable
and whom subordinates wish to use as a
role model
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17. Empowerment: An Ingredient in
Modern Management
• Empowerment
– The process of giving employees at all levels
in the organization the authority to make
decisions, be responsible for their outcomes,
improve quality, and cut costs
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18. Empowerment: An Ingredient in
Modern Management
• Empowerment increases a manager’s
ability to get things done
• Empowerment increases workers’
involvement, motivation, and commitment
• Empowerment gives managers more time
to concentrate on their pressing concerns
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19. Leadership Models
• Trait Model
– Attempt to identify personal characteristics
that cause for effective leadership.
– Research shows that certain personal
characteristics do appear to be connected
to effective leadership.
– Many “traits” are the result of skills and
knowledge and effective leaders do not
necessarily possess all of these traits.
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20. Leadership Models
• Behavioral Model
– Identifies the two basic types of behavior
that many leaders engaged in to influence
their subordinates
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21. Leadership Models
• Behavioral Model
– Consideration: leaders show subordinates they
trust, respect, and care about them
– Managers look out for the well-being of their
subordinates
– Do what they can to help subordinates feel
good and enjoy the work they perform
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22. Leadership Models
• Behavioral Model
– Initiating structure: leaders take steps to
make sure that work gets done,
subordinates perform their work acceptably,
and the organization is efficient and
effective
– Managers assign tasks to groups and let
subordinates know what is expected of
them
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23. Contingency Models of Leadership
• Contingency Models
– What makes a manager an effective leader
in one situation is not necessarily what that
manager needs to be equally effective in
another situation
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24. Contingency Models of Leadership
• Contingency Models
– Whether or not a manager is an effective
leader is the result of the interplay between
what the manager
is like, what he does,
and the situation in
which leadership
takes place
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25. Contingency Models of Leadership
• Fiedler’s Model
– Effective leadership is contingent on both
the characteristics of the leader and of the
situation.
– Leader style is the enduring, characteristic
approach to leadership that a manager uses
and does not readily change.
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26. Contingency Models of Leadership
• Fiedler’s Model
– Relationship-oriented style: leaders
concerned with developing good relations
with their subordinates and to be liked by
them.
– Task-oriented style: leaders whose primary
concern is to ensure that subordinates
perform at a high level so the job gets done.
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27. Fiedler’s Model
• Situation Characteristics
– Leader-member relations – extent to which
followers like, trust, and are loyal to their
leader
– Task structure – extent to which the work to
be performed is clear-cut so that a leader’s
subordinates know what needs to be
accomplished and how to go about doing it
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28. Fiedler’s Model
• Situation Characteristics
– Position Power - the amount of legitimate,
reward, and coercive power leaders have
due to their position. When positional power
is strong, leadership opportunity becomes
more favorable.
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29. Fiedler’s Contingency Theory of
Leadership
Figure 14.2
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30. House’s Path-Goal Theory
A contingency model of leadership proposing that
effective leaders can motivate subordinates to
achieve goals by:
1. Clearly identifying the outcomes that
subordinates are trying to obtain from their
jobs.
2. Rewarding subordinates with these
outcomes for high-performance and
attainment of work goals
3. Clarifying the paths leading to the attainment
of work goals
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31. Question?
Which leadership behavior gives
subordinates a say in matters that
affect them?
A. Directive behavior
B. Supportive behavior
C. Participative behavior
D. Achievement-oriented behavior
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32. Motivating with Path-Goal
• Path-Goal identifies four leadership
behaviors:
– Directive behaviors: set goals, assign tasks,
show how to do things.
– Supportive behavior: look out for the worker’s
best interest.
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33. Motivating with Path-Goal
• Path-Goal identifies four leadership
behaviors:
– Participative behavior: give subordinates a
say in matters that affect them.
– Achievement-oriented behavior: Setting
very challenging goals, believing in worker’s
abilities.
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34. Motivating with Path-Goal
Which behavior to be
used depends on
the nature of the
subordinates and
the kind of work
they do
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35. Discussion Question
Which leadership model is the most
effective?
A. Trait model
B. Behavior model
C. Fiedler’s model
D. Path-goal theory
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36. The Leader Substitutes Model
• Leadership Substitute
– Acts in the place of a leader and makes
leadership unnecessary.
– Worker empowerment or self-managed
work teams reduce leadership needs.
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37. The Leader Substitutes Model
• Possible substitutes can be found in:
– Characteristics of the subordinates: their
skills, experience, motivation.
– Characteristics of context: the extent to
which work is interesting and fun.
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38. Transformational Leadership
Leadership that:
1. Makes subordinates aware of the importance
of their jobs are for the organization and
how necessary it is for them to perform those
jobs as best they can so that the
organization can attain its goals
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39. Transformational Leadership
2. Makes subordinates aware of their own
needs for personal growth,
development, and accomplishment
3. Motivates workers to work for the good
of the organization, not just for their
own personal gain or benefit
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40. Being a Charismatic Leader
• Charismatic Leader
– An enthusiastic, self-confident
transformational leader able to clearly
communicate his vision of how good things
could be
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41. Being a Charismatic Leader
• Charismatic Leader
– Being excited and clearly communicating
excitement to subordinates.
– Openly sharing information with employees
so that everyone is aware of problems and
the need for change.
– Empowering workers to help with solutions.
– Engaging in the development of employees
by working hard to help them build skills.
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42. Intellectual Stimulation
• Intellectual Stimulation
– Manager leads subordinates to view
problems as challenges that they can and
will meet and conquer
– Manager engages and empowers
subordinates to take personal responsibility
for helping to solve problems
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43. Developmental Consideration
• Developmental Consideration
– Manager supports and encourages
subordinates, giving them opportunities to
enhance their
skills and
capabilities and
to grow and
excel on the job
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44. Transactional Leadership
• Transactional Leaders
– Use their reward and coercive powers to
encourage high performance—they
exchange rewards for performance and
punish failure.
– Push subordinates to change but do not
seem to change themselves.
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45. Gender and Leadership
• The number of women managers is
rising but is still relatively low in the top
levels of management.
• Stereotypes suggest women are
supportive and concerned with
interpersonal relations. Similarly, men
are seen as task-focused.
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46. Gender and Leadership
• Research indicates that actually there is
no gender-based difference in
leadership effectiveness.
• Women are seen to be more
participative than men because they
adopt the participative approach to
overcome subordinate resistance to
them as managers and they have better
interpersonal skills.
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47. Emotional Intelligence and Leadership
• The Moods of Leaders:
– Groups whose leaders experienced positive
moods had better coordination
– Groups whose leaders experienced
negative moods exerted more effort
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48. Emotional Intelligence and Leadership
• Emotional Intelligence
– Helps leaders develop a vision for their firm.
– Helps motivate subordinates to commit to
the vision.
– Energizes subordinates to work to achieve
the vision.
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49. Movie Example: The Fugitive
• What type of
leader is Gerard?
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