Charismatic Leadership Running head: CHARISMATIC LEADERSHIP

The Persuasive Power of Charismatic Organizational Leadership Thaddeus Smith November 18, 2010 Senior Project

Charismatic Leadership Abstract This investigation revealed that college students and employees of companies were given questionnaires to analyze their perception of charisma observed in leaders. Both real and

recorded situations were employed in the studies. Charisma influences how people think and act. Charismatic leadership improves morale and profitability in a company. Charismatic leaders can overcome environmental uncertainty to help achieve positive results for themselves and for the people around them. Together, these studies suggest that charismatic organizational leadership is possible through charismatic leadership that encourages a positive work attitude and consensus building. Keywords: charismatic leadership, positive work attitude, consensus building

Charismatic Leadership Introduction Throughout history, some charismatic leaders have positively influenced people in society; leaders such as Jesus, John F. Kennedy, Martin Luther King Jr., Diana, Princess of Wales and, of today, Oprah Winfrey in the business world. One definition of charismatic leadership is the learned ability to overcome environmental uncertainty through motivated cooperation and producing a desired outcome (Agle, Nagarajan, Sonnenfield, & Srinivasan,

2006). Agle et al. (2006) defines environmental uncertainty as a downturn in business and a time requiring more leadership direction. Individuals perceived as charismatic in organizations today help achieve positive results for themselves and for the people around them (Platow, van Knippenberg, Haslam, van Knippenberg, & Spears, 2006). This paper addresses some of the components of charisma experienced within the organizational setting. The three main variables discussed about charisma in organizations today are charismatic leadership, positive work attitude, and consensus building. To begin with a definition of charismatic leadership, it involves identifying important tasks to have other people complete, instilling enthusiasm in other people, being a problem solver, having an interest in helping the group, a willingness to take chances that challenge the majority view, being someone that can be trusted, and having a willingness to do more than is expected (Babcock-Roberson and Strickland, 2010). Agle et al. (2006) used CEO charisma as their variable name for charismatic leadership. And it is someone that develops cooperation between people working in companies, someone that shares their plans for the company with the workers, and helps people to see chances for growth. Positive work attitude is demonstrating and encouraging enthusiasm to complete tasks in the workplace (de Hoogh et al., 2004). Consensus building is developing general agreement among everyone (Fiol, Harris, & House, 1999).

Charismatic Leadership Literature Review Charismatic Leadership Three types of behaviors are relevant to charismatic leadership: transfer of arousal,

(Damien, Knippenberg, & Knippenberg, 2008), vision content, (Awamleh & Gardner, 1999), and performance beyond expectations, (Hunt, Bowl, & Dodge, 1999). Damien et al. (2008) identified transfer of arousal as the shifting of enthusiasm onto other people. For example, Damien et al. (2008) used a set of questions to ask college students to respond to an imagined business situation of someone giving a speech. Damien et als. (2008) study concluded that enthusiasm expressed by leaders is more likely to enhance charismatic leadership compared to expressions of anger, relaxation, or sadness. That result is important because it identifies a key characteristic that should be present with individuals planning to enter management of an organization. Awamleh and Gardner (1999) said that vision content consists of two processes: (a) the ability of a person to persuade other people to substitute an old way of thinking for a new way of thinking by exhibiting self-assurance, a strong presence, and excellent verbal and nonverbal communication, and (b) using words in a creative way to teach and persuade people to accept a new view. Awamleh and Gardner (1999) used a set of questions given to college students who watched different forms of a recorded speech that included variations of vision content, message delivery, and organizational performance. Awamleh and Gardners (1999) study showed that including a new way of thinking with goal-oriented views in a speech will improve the impression made by the charismatic leader. Those findings are significant because they are reasons to feel encouraged about developing ones charismatic leadership ability. Hunt et al. (1999) said that performance beyond expectations is moving people to accomplish more than satisfactory results. For example, Hunt et als. (1999) used an experiment

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that used different scripts to manipulate participants experience of leadership. The experiment included analyzing the subjects responses to charismatic leadership upon the completion of tasks in a college setting that had increasing amounts of work and decreasing amounts of time to complete the work. Hunt et als. (1999) study revealed there will be larger amounts of charisma in other people during a panic situation regarding performance beyond expectations compared to times when everything is calm or stable. Charismatic leadership was studied in similar ways by Damien et al. (2008) and by Awamleh and Gardner (1999). For example, Damien et al. (2008) used a set of questions to ask college students to respond to an imagined business situation of someone giving a speech. Awamleh and Gardner (1999) used a set of questions given to college students who watched different forms of a recorded speech that included variations of vision content, message delivery, and organizational performance. Both studies are similar because a real and present charismatic leader did not participate with the participants in the study. The study done by Hunt et al. (1999), used an experiment with different scripts to manipulate participants experience of leadership. The experiment included analyzing the subjects responses to charismatic leadership upon the completion of a simulated process of tasks in a college setting that had increasing amounts of work and decreasing amounts of time to complete the work. The latter study represented a more realistic and therefore a more credible source. All of these results point to the strong influence that charisma can have on people. Damien et al. (2008) looked at enthusiasm, Awamleh and Gardner (1999) identified a new way of thinking with goal-oriented views, and Hunt et al. (1999) looked at high performance during a panic situation. All of these studies point to the conclusion that charisma influences how people

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think and act. In addition to charismatic leadership, positive work attitude influences how people think and act. Positive Work Attitude Enthusiasm while at work is based upon three things: positive work attitude (de Hoogh et al., 2004), work engagement (Babcock-Roberson and Strickland, 2010), and team optimism (Baeza, Lao, Meneses, & Roma, 2009). de Hoogh et al. (2004) said that positive work attitude is demonstrating and encouraging enthusiasm to complete tasks in the workplace. For example, de Hoogh et al. (2004) contacted heads of companies for permission to distribute questionnaires to their employees. de Hoogh et al. (2004) claimed that charismatic leadership does favorably influence the morale of workers and it positively influences profitability. The importance of those findings says that when employees are happier and motivated to do their best work, they have more rewards, and their company is rewarded more too. Babcock-Roberson and Strickland (2010) said that work engagement is the passionate interest in the job, and being devoted, and motivated. For example, Babcock-Roberson and Strickland (2010) used a questionnaire to determine to what amount managers are perceived by workers attending college to have charismatic leadership qualities. The study reported that there is a good and favorable connection between charismatic leadership and work engagement. The results of this study are important because they identify how charismatic leaders in companies affect the behavior of their subordinates. Additionally, it is important to consider the behavior of charismatic leaders while interviewing potential employees and teaching new skills to current employees.

Charismatic Leadership Baeza et al. (2009) identified team optimism as team members that are hopeful and

confident about the future success or outcome of something. For example, Baeza et al. (2009) used a questionnaire to gather data from groups of employees in many locations of the same company about leader charisma. The findings revealed that increased amounts of viewed leaders charisma determined whether there will be increased amounts of team optimism. The importance of those results indicates a leaders charismatic effect on followers is primarily determined by how the followers view and connect with the leader, it is also determined by the leaders viewed power to persuade other people, and by the amount of contact the leader has with followers. These points are important because they identify how leaders need to act, so they can relate well to people in order to accomplish their goals. Positive work attitude was studied in similar ways by de Hoogh et al. (2004), BabcockRoberson and Strickland (2010), and by Baeza et al. (2009). For example, de Hoogh et al. (2004) contacted heads of companies for permission to distribute questionnaires to their employees. Babcock-Roberson and Strickland (2010) used a questionnaire to determine to what amount managers are perceived by workers attending college to have charismatic leadership qualities. Baeza et al. (2009) used a questionnaire to gather data from groups of employees in many locations of the same company about leader charisma. The study done by Babcock-Roberson and Strickland (2010) is the only exception because it involves college students. Despite different methods, all of these results point to the positive influence of charisma within the organization. de Hoogh et al. (2004) identified charismas positive influence on worker morale and on profitability, Babcock-Roberson and Strickland (2010), identified a connection between charismatic leadership and work engagement, and Baeza et al. (2009) identified team optimism determined by a leaders charisma. All of these studies point to the

Charismatic Leadership conclusion that charismatic leadership improves morale and profitability in a company. In

addition to charismatic leadership, consensus building helps to bring people together within a company. Consensus Building Consensus building is related to inclusion (Fiol et al., 1999), confidence in leader (Hunt et al., 1999), and need for leadership (De Vries et al., 1999). Fiol et al. (1999) identified inclusion as bringing everyone together using words like we, us, our. For example, Fiol et al. (1999) used semiotic analysis which basically looks at how things are symbolized by other things and how accepted beliefs, concepts or ideas are created, altered or eliminated. Specifically, presidential speeches were analyzed. The study showed that charismatic leaders were more successful at bringing people together using those inclusive words in their communication. Those findings are important because charismatic leaders repeatedly use certain speech methods to reduce peoples acceptance of old ideas or values and at the same time increase their acceptance of new ideas or values to the point where there is little or no objection (Fiol et al., 1999). Hunt et al. (1999) identified confidence in the leader as a means of demonstrating and instilling trust. For example, Hunt et al. (1999) used an experiment that used different scripts to manipulate participants experience of leadership. Hunt et als., (1999) study showed that confidence in the leader was necessary during crisis situations, however once the situation subsided confidence subsided as well. Therefore, this study is essential to anyone in a leadership capacity.

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De Vries, Roe, and Taillieu (1999) used a questionnaire to gather information about the need for leadership from people in different occupations in the Netherlands. The study revealed a need for leadership from the followers standpoint, so there is a strong interest in being managed to accomplish goals. Furthermore the study showed charismatic leaders may choose two ways of influencing others. Firstly, the charismatic leader may continually persuade and encourage others to accomplish things and simultaneously maintain the control in the situation or in the company. In the second approach the charismatic leader can enable his or her followers by teaching them how to become charismatic too. The second mentoring process builds better individuals and perpetuates more successful growth of the company compared to the first. Consensus building was studied in three contrasting ways by Hunt et al. (1999), De Vries et al. (1999), and Fiol et al. (1999). For example, Hunt et al. (1999) used an experiment that used different scripts to manipulate participants experience of leadership. The experiment included analyzing the subjects responses to charismatic leadership upon the completion of a simulated process of tasks in a college setting that had increasing amounts of work and decreasing amounts of time to complete the work. Fiol et al. (1999) used semiotic analysis which basically looks at how things are represented by other things and how accepted beliefs, concepts or ideas are created, altered or eliminated. Specifically, presidential speeches were analyzed. De Vries et al. (1999) used a questionnaire to gather information about the need for leadership from people in different occupations in the Netherlands. Even though the methods of study were different, all led to a similar conclusion. All of these results point to the importance of cooperation and the need for leadership. Fiol et al. (1999) identified inclusive words, Hunt et al. (1999) identified instilling trust, and De

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Vries et al. (1999) identified the need for being managed. All of these studies point to working together and expecting to be managed as keys to Critique and Future Research Taken together, these studies suggest that charismatic leadership, positive work attitude and consensus building are essential in charismatic organizational leadership. Damien et al. (2008), Awamleh and Gardner (1999), and Hunt et al. (1999) identified that charisma influences how people think and act. De Hoogh et al. (2004), Babcock-Roberson and Strickland (2010), and Baeza et al. (2009) identified that charismatic leadership improves morale and profitability in a company. Fiol et al. (1999), Hunt et al. (1999), and De Vries et al. (1999) identified the need for cooperation and expectation of being managed. Taken together, these studies suggest that charismatic organizational leadership is possible through leadership that encourages charismatic leadership, a positive work attitude and consensus building. Therefore, I propose: H1: Charismatic leadership in organizations can influence transfer of arousal and lead to performance beyond expectations. Furthermore, it is apparent that charismatic leadership produces improved morale in a company. Therefore, I propose: H2: Leaders with charismatic abilities in organizations can influence their employees positive work attitude. Also, it is clear that cooperation and expecting to be managed are essential components in organizations. Therefore, I propose:

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H3: Leaders that develop their charismatic abilities can improve consensus building in a company. Conclusion This paper has shown that leaders with charismatic abilities can improve the cooperation and morale of the workers in a company. Charismatic leaders can also overcome environmental uncertainty to help achieve positive results for themselves and for the people around them (Agle et al., 2006). One of the best charismatic leaders today is Oprah Winfrey. Oprah is one of the most successful women in the United States and is recognized internationally for her positive influence on people. Oprahs success can be attributed to her charismatic ability to instill enthusiasm in people, to bring everyone together, and to encourage people to lead better lives. While this paper has predominantly focused on charismatic leadership having a positive influence on people in organizations, there is also a negative side to charismatic leadership. The history books point to many former dictators of countries and to fanatics that used their charismatic leadership to harm other people and to bring about great destruction in the world. So, in the words of the Greeks from which the word charisma originates, it is described as a gift or divine favor. It is a gift that must be used carefully for everyones benefit.

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Agle, B. R., Nagarajan, N. J., Sonnenfeld, J. A., & Srinivasan, D. (2006). Does CEO charisma matter? An empirical analysis of the relationships among organizational performance, environmental uncertainty, and top management team perceptions of CEO charisma. Academy of Management Journal, 49, 161-174. Awamleh, R., & Gardner, W. L. (1999). Perceptions of leader charisma and effectiveness: The effects of vision content, delivery, and organizational performance. Leadership Quarterly, 10, 345-373. Babcock-Roberson, M. E., Strickland, O. J. (2010). The relationship between charismatic leadership, work engagement, and organizational citizenship behaviors. The Journal of Psychology, 144, 313-326. Baeza, A. H., Lao, C. A., Meneses, J. G., & Roma, V. G. (2009). Leader charisma and affective team climate: The moderating role of the leaders influence and interaction. Psicothema, 21,515-520. Damien, F., van Knippenberg, D., & van Knippenberg, B. (2008). Leader affective displays and attributions of charisma: The role of arousal. Journal of Applied Social Psychology, 38, 2594-2614. de Hoogh, A. H. B., den Hartog, D. N., Koopman, P.L., Thierry, H., van den Berg, P. T., van der Weide, J. G., & Wilderom, C. P. M. (2004). Charismatic leadership, environmental dynamism, and performance. European Journal of Work and Organizational Psychology, 13, 447-471.

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De Vries, R. E., Roe, R. A., & Taillieu, T. C. B. (1999). On charisma and need for leadership. European Journal of Work and Organizational Psychology, 8, 109-133. Fiol, C. M., Harris, D., & House, R. (1999). Charismatic leadership: Strategies for effecting social change. Leadership Quarterly, 10, 449-482. Hunt, J. G., Boal, K. B., & Dodge, G. E. (1999). The effects of visionary and crisis-responsive charisma on followers: An experimental examination of two kinds of charismatic leadership. Leadership Quarterly, 10, 423-448. Platow, M. J., van Knippenberg, D., Haslam, S. A., van Knippenberg, B., & Spears, R. (2006). A special gift we bestow on you for being representative of us: Considering leader charisma from a self-categorization perspective. British Journal of Social Psychology, 45, 303320. Schyns, B., Felfe, J., & Blank, H. (2007). Is charisma hyper-romanticism? Empirical evidence from new data and a meta-analysis. Applied Psychology: An International Review, 56, 505-527. Tosi, H. L., Misangyi, V. F., Fanelli, A., Waldman, D. A., & Yammarino, F. J. (2004). Ceo charisma, compensation, and firm performance. The Leadership Quarterly, 15, 405-420.

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