Chapter One

Definition and Significance of Leadership

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Learning Objectives
 Define leadership and leadership effectiveness.  Explain why people need leadership.  Discuss the major obstacles to effective leadership.  Compare and contrast leadership and management.  List the roles and functions of leaders and managers.  Summarize the debate over the role and impact of leadership in organizations.

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Definition of Leadership
A leader is any person who influences individuals and groups within an organization, helps them in the establishment of goals, and guides them toward achievement of those goals, thereby allowing them to be effective

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Key Elements of the Definition of Leadership

 Leadership is a group phenomenon  Leadership is goal-oriented; leaders guide and influence others  Leadership involves some form of hierarchy in groups

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Definition of Leadership Effectiveness

Leaders are effective when their followers achieve their goals, can function well together, and can adapt to the changing demands from external forces

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Key Elements of Effectiveness

 The group achieves its goals  The group functions well together; there are smooth internal processes  The group can adapt well to external changes

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Why Do We Need Leaders?

 To keep groups orderly  To keep focus on group goals  To accomplish complex tasks  To help make sense of the world by providing validation  As a romantic ideal
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Obstacles to Effective Leadership

 Environmental uncertainty  Organizational rigidity  Fall back on old ideas and simplistic solutions  Established organizational culture  Inaccessible research
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Leadership and Management

Managers  Focus on the present  Maintain status quo  Implement policy  Maintain structure  Remain aloof and objective  Use position power
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Leaders  Focus on the future  Create change  Initiate policy  Create culture and structure  Establish emotional link with followers  Use personal power
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Managerial Roles
 Figurehead  Leader  Liaison  Monitor  Disseminator  Spokesperson  Entrepreneur  Disturbance handler  Resource allocator  Negotiator

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Gender Differences in Roles

Male Managers  Work at unrelenting pace  Wide variety of tasks  Frequent interruptions  Little time to communicate  Few non-work activities  Feeling of isolation  Identity tied to work  Complex network  Prefer face-to face Female Managers  Calm steady pace  Frequent breaks  Did not perceive interruptions  Scheduled time for communication  Many non-work activities  Not isolated  Multi-faceted identity  Complex network  Prefer face to face
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Leaders Function in Shaping Culture

LEADER

Role Model

Reward System

Hiring Decisions

Strategy & Structure

Organizational Culture
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Impact of Leadership: Leadership Is Insignificant

 Outside environmental factors affect organizations more than leadership  Internal structure and strategy determine the course organizations take  Leadership accounts for only between 7% to 15% of performance  Leaders have little discretion to really make an impact  Leadership is a romantic myth rather than a real organizational factor
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Impact of Leadership: Leadership Is Significant

 Leadership is one of many important factors  Leadership is key to providing vision and direction  Leadership is critical in orchestrating change  Leadership can account for up to 44% of a firms profitability  Leadership is critical in orchestrating change  Leaderships impact is moderated by situational factors
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The Impact of Leadership

 Leadership is one of many factors  Leadership is significant in providing vision and direction  Situations are key to understanding the impact of leadership  Followers are also key to success

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New Roles for Leaders

Control-oriented Leadership Plan Lead Control Do Do Results Leader assumes responsibility
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Result-oriented Leadership Lead Plan Control

Results

Leader and follower assume responsibility

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Factors Fueling Change

Changes in Organizations and Leadership

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Diversity in U.S. Population

0.1% 3.6% 0.9% 12.3% 5.5% 2.4%
White alone Black alone American Indian and Alaska Native alone Asian alone Native Hawaiian and other Pacific Islander alone Some other race alone

75.1%

Two or more races

Source: U.S. Census Bureau, Census 2000 http://www.census.gov/population/

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U.S. Demographic Trends

 In 2000, 13% of population spoke a language other than English  Women and minorities make up over half of the workforce  By 2016, minorities will be one third of the population  By 2025, Hispanics will outnumber African Americans  By 2025, the average age will be 40  By 2050, the average U.S. resident will be nonEuropean

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Barriers to Change
 Perceived financial pressures  Short-term orientation  Top management still focused on one person  Traditional hierarchies  Employee input not fully considered  Focus on individual performance  Traditional management
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Leadership Challenge
Challenges for new leaders
Learning new duties New roles Maintaining relationships

Actions that can help

Training Clear message

Actions to avoid
Over managing - taking charge Trying to remain one of the boys
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Leading Change: The Container Store

 Unique culture based on employees and customers  Leadership based on communication and inclusion  Careful and extensive training of employees

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Leadership in Action: David Neeleman

 Quickly expanding airline  Small size; young fleet  Focus on treating people well  Neeleman provides vision and actively listens to followers  Focus on creativity and use of technology  Nimble and able to change
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All rights reserved. No part of this publication may be reproduced, stored in a retrieval system, or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. Printed in the United States of America.

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