BHS00156

Leadership
Written by: Peter Miller Revised by: Chris Deftereos

Study Guide

Second Edition

 2006 Southern Cross University Developed and produced by Flexible Learning Development Services, Division of Business, Southern Cross University Military Rd, East Lismore, NSW, 2480. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form or by means electronic, mechanical, photocopying, recording or otherwise without the prior written permission of the publisher. Copyright material indicated in this work has been copied under Part VB of the Copyright Act 1968. CAL LICENSED COPY UNAUTHORISED COPYING PROHIBITED

Second edition 2006

CONTENTS
Topic Pre-test 1 1 Page 3 What is Leadership? ............................................................................................ 5 Objectives .................................................................................................. 5 Introduction .............................................................................................. 5 Dening Leadership ............................................................................... 10 Transactional Leadership ......................................................................... 11 Transformational Leadership ................................................................... 11 Making Sense of Denitions ................................................................... 14 2 Ethical leadership .............................................................................................. 19 Objectives ................................................................................................ 19 Leadership and Self Awareness ............................................................... 19 The Importance of Values ........................................................................ 19 Leadership and Ethics.............................................................................. 21 Simple Guides to Ethical Behaviour ....................................................... 21 Stakeholder Approach to Ethics .............................................................. 22 3 The Trait and Behavioural Approaches to Leadership ...................................... 23 Objectives ................................................................................................ 23 Introduction ............................................................................................. 23 Trait Theories........................................................................................... 25 Behavioural Theory ................................................................................. 27 The Leadership Grid ................................................................................ 28 Likerts System Model ............................................................................ 31 4 Contemporary Approaches to Leadership ......................................................... 35 Objectives ................................................................................................ 35 Contingency Theory ................................................................................ 35 Fiedler Model .......................................................................................... 37 Path-Goal Model ..................................................................................... 41 Hersey and Blanchard Lifecycle Model .................................................. 45 The Decision Model ................................................................................ 47 The Integrative Leadership Approach ..................................................... 51 Followership ............................................................................................ 51

BHS00156 LEADERSHIP

Leadership and Power ....................................................................................... 53 Introduction ............................................................................................. 53 Power A Dirty Word?............................................................................ 54 Sources of Power ..................................................................................... 55 Personality and Power ............................................................................. 58 Individual Characteristics ........................................................................ 58 Situational Variables ................................................................................ 59

Leadership and Inuence .................................................................................. 63 Objectives ................................................................................................ 63 Leadership, Power and Inuence............................................................. 64 The Encouraging Leader ......................................................................... 66 Creating Empowered Managers .............................................................. 67

Pre-test 2 7

71 Leadership and Organisational Change ............................................................ 73 Objectives ................................................................................................ 73 Why People Resist Change ..................................................................... 77 Five Phases in Gaining Satisfaction with Change .................................. 82 Putting It Together ................................................................................... 85 What Do Change Leaders Do? ................................................................ 89 Take Charge! ............................................................................................ 91

Developing Teamwork ...................................................................................... 97 What to Concentrate On .......................................................................... 99 Management By Walking Around (MBWA) ......................................... 104 Delegation.............................................................................................. 106 Participative Management Processes..................................................... 109

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Leadership, Culture & Diversity ..................................................................... 111 Designing and Leading a Learning Organisation .......................................... 115 Leader-Managers As Designers ............................................................. 116 Leader-Managers As Teachers ............................................................... 117 Systems Thinking .................................................................................. 119

References

121

Suggested Answers to Pre-test 1 ........................................................................................ 125 Suggested Answers to Pre-test 2 ........................................................................................ 127
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PRE-TEST 1
Mark the following statements true or false by circling the answer you believe is correct. 1. 2. 3. 4. 5. 6. 7. 8. 9. Leaders are born, not made. True/False

To be an effective leader I must rst learn to manage True/False efciently. In a given circumstance, my preferred leadership style True/False will be the most important factor in determining my effectiveness as a leader. A leader cannot be concerned about task accomplishment True/False and people at the same time and get the job done. A directive style of leadership which produces results True/False should be maintained. Good leaders consider the circumstances present at the True/False time when deciding their leadership style. All leadership models suggest leaders can change True/False styles. A managers ability to lead effectively may depend on True/False the networks she/he can create outside the work team. New staff need to be managed in a different way to other True/False experienced members of the work team.

10. Communication skills are important to effective True/False leaders. Suggested answers are in the back of this study guide.

BHS00156 LEADERSHIP

TOPIC 1
WHAT IS LEADERSHIP?
Objectives
By the end of the topic you should be better able to: understand the concept of leadership examine the similarities and differences between leadership and management explain the difference between transactional and transformational leadership.

Introduction
The study of leadership has a long and vigorous history, with thousands of empirical studies being conducted over an 85-year period, but with much intellectual discussion occurring for possibly even thousands of years. Thus, it may not be expected that we shall be able to tackle every issue and resolve every paradox and explore every nuance of such an important and extensive eld. Nevertheless, there should be many things of interest to students of management and organisational behaviour as we delve into the literature about leadership in organisations. This unit focuses on the study of leadership in organised or institutional relationships and on people who engage in pursuits in organisations. This does not, however, limit the discussion of leadership to enterprise management, although that particular context is of enduring interest to those interested in leadership, but to the contrary it opens the horizons so that the principles and theory may be applied to the full range of settings in which people enact organised activities, including government, service, religious, agricultural, social, professional, and even family organisations, in addition to business, industry, and educational organisations. There is a theme that runs through the lives of people and the literature on managing and leading that bears highlighting in this overview. The theme

BHS00156 LEADERSHIP

is that leaders are different from managers. Maybe there isnt a difference, but we tend to call a person a leader when they behave in one way and a manager when they behave in another. The essential difference between a leader and a manager has been expressed by Deal and Jenkins (1994) in their book about managing workers operating behind the scenes (p. xiii). They explain that
Management concentrates on short-term control and is oriented toward facts, reports, and bottom-line results. In contrast, leadership is exercised through inuence or other non coercive means.

They argue that

leaders inspire, empower, attract, reward, and motivate people. They also assert that the decade of the nineties and beyond will reward leadership rather than management (p. 257).

Zaleznik (1977) attempted to distinguish between managers and leaders by arguing that it takes neither genius nor heroism to be a manager, but rather persistence, tough-mindedness, hard work, intelligence, analytical ability and, perhaps most important, tolerance and good will (p. 68). Leadership, on the other hand, invariably requires using power to inuence the thoughts and actions of other people (p. 67) in order to create new approaches and imagine new areas to explore. He concluded by asserting that for organisations to encourage consciously the development of leaders as compared with managers would mean developing one-to-one relationships between junior and senior executives and, more important, fostering a culture of individualism and possibly elitism (p. 76). Zaleznik may have been describing restrictions inherent in an American perspective. Parry (1996) claims that Australian leadership is different from American leadership (p. 95), perhaps, he says, because Australians place a lesser emphasis on leadership than do workers in the United States, or perhaps Australians expect more of their management than do workers in the United States (p. 102). On the other hand, Parry suggests, leadership may be less important and more difcult to develop among Australians because of the cynicism toward authority and the intrinsic suspicion of people who make it to the top (p. 103). Thus, he concludes, perhaps for these reasons, Australian leadership behaviour that focuses on the lower levels of the organisation seem to be most appropriate, whereas in the United States, leader behaviour that focuses on the higher levels of organisational behaviour seems to be most appropriate (p. 103).

BHS00156 TOPIC 1 WHAT IS LEADERSHIP?

Horne (1964), an early analyst of Australian patterns of thinking and living, may have captured a frame of mind shared by at least some Australians that mediates against the development of organisational leaders. He said that
Like all optimists, Australians are stupendous simpliers. As practical minded optimists they can get away with their dislike of discussion of even practical issues because most of these issues are claried for them overseas. Their main job is to improvise an adaptation of overseas ideas in conditions that are not very competitive. But these cheerful simplications will work only as and only as long as it is not called on to provide ideas for itself (p. 48).

Whatever the culture in which you are situated, you will need to consider the study of leadership from your own cultural perspective and that of the dominant culture in which you work and live. Accordingly, some of the theories and models to be presented to you may not be appropriate to your culture and you may need to review the materials with this qualication in mind. Hitt (1988) has argued that it is possible to have leader-managers, the title of his book on leadership, in any culture and on any continent. The leader-manager, he asserts, is a pragmatic idealist, a person who transforms vision into signicant actions (p. 6). The essence of leadership is found in a persons ability to move an organisation successfully from state A to state B, that is, to a higher level of performance. Hitt appears to be convinced that the ideal is to combine into a single person the attributes of leader-manager. Waldersee and Eagleson (1996), on the other hand, have recently announced, based on research completed in the South Pacic and Australia, that results clearly show that leadership is most effective when split between different task and person oriented leaders. Attempts by a manager to full both roles at the same time can lead to confusing body language. More importantly, very few leaders are good at both. Leaders tend to be good at task or person leadership, but only a minority are really heroes (p. 2). Of some concern to many people is potential differences between leadership at middle management levels and leadership at executive levels in organisations. Much of the criticisms of major corporate and political gures is that they fail to perform as leaders. Dont make up your mind about this issue until you have read what it says in the readings about this issue. I will show my thoughts on this issue in the unit but you should make up your own mind.

BHS00156 LEADERSHIP

Finally, the much discussed issue of differences between men and women in fullling leadership roles and in executing leadership behaviour is introduced in this unit. More could be said, but this may be a beginning. There is no immediate need to complicate this discussion further nor is there a pressing need to resolve some of these issues. This is the task of this unit. It is your opportunity to ferret out tentative conceptions, supporting evidence, and signicant implications about leadership and to formulate some positions. When considering the concept of leadership in management, we rst need to understand the traditional business concept of managers, managerial roles and responsibilities. In business organisations, managers are people who are responsible for other people. Traditionally, the shape of most employing organisations is a pyramid. Workers at the lowest level of management in the hierarchy are called supervisors or front line managers and have the responsibility of supervising the majority of workers at the bottom of the pyramid. Further up the line, middle managers are responsible for other managers and so it goes, with fewer and fewer people at the higher levels. In many Australian organisations the process of downsizing and multiskilling workers has been underway for some years. The concepts of quality management and continuous improvement are also being embraced so that, in addition to the changes forced by international competition and internal incentives, a change in attitude towards the customer or purchaser of the end product or service needs to be made by everyone in the organisation. Change is being assisted by attempts to atten out the pyramid-like structures and develop more highly-skilled and multi-skilled teams of people who will replace the lines of traditional hierarchical management. Of the four traditional functions of a manager, PLANNING, ORGANISING, LEADING, and CONTROLLING,

the study of the leading function has probably demanded the most attention and examination from researchers. Nonetheless, it remains the least understood. While the concept is mysterious, the difference between success and failure in many organisations is largely attributed to effective leadership.

BHS00156 TOPIC 1 WHAT IS LEADERSHIP?

Lack of leadership has been largely blamed for the demise of Australias relative economic position over the last two decades. Sports teams often attribute their success to the leadership of the captain. These examples are clear evidence that leadership exists as a tangible force and can have a signicant inuence on human performance. David Karpin, Chair of the Commonwealth Governments recent report of the Industry Task Force on Leadership and Management Skills (April 1995) had this to say on the relationship between leadership of Australian managers and the productivity of the national economy: Permanency of reform and constructive change will depend on recognition that excellent leaders and managers require well structured, systematic education and continual development so that they can add maximum value to the national economy through their performance within their enterprises. The Report was conclusive in that it linked the leadership of Australian managers to workplace reform, internationally competitive enterprises and improved living standards for all Australians. Despite all the attention given to leadership and its recognised importance, we still lack a universally accepted denition. Because of this lack of agreement, researchers often measure and discuss particular aspects of leadership. Confusion may result for some of us who are learning about leading techniques through study. We also need to practise and learn from our experiences. So what makes an effective leader? Most people would answer this question by describing the qualities or traits of people they respect as effective leaders. However, as we will discover, there are no demonstrated links between traits and effective leaders. Before we commence however, some basic underlying assumptions need to be considered when reading this material. It is my belief that managers at all levels in organisations are increasingly accepting these assumptions as correct. The assumptions concern the value of participative management processes which bring about a genuine atmosphere of trust and respect in a work team, allowing all members to contribute and learn.

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Assumptions
to be a good leader, managers must like what they do and be enthusiastic about it to be a good leader, a leader must know their own limitations, be comfortable with who they are and be able to understand themselves so that they can understand others there is no one best way to lead a group of people. An effective leader will use a variety of styles depending upon the organisational and interpersonal factors present in a given situation genuine regard for people by a manager and regard for people generally within the culture of an organisation can turn an average team member into an extraordinary contributor as the unit takes a workplace focus, the word leader and manager will be used interchangeably leadership is a personal ability that is born and evident in some, but can be developed in others who have the will to want it and the potential to develop it.

Dening Leadership
When his work is done, his aim fullled, They will all say, We did this ourselves
Lao Tzu Book of Tao

As already mentioned in the introduction and as the quotation above suggests, leadership is a mysterious concept which almost dees denition. Stogdill (1974) in a survey of leadership theories and research made the point that there was almost as many different denitions of leadership as there were persons who attempted to dene it. I have selected a very simple denition to commence with. Hersey, Natemeyer and Blanchard (1979) dene leadership as:
the process of inuencing the activities of individuals and groups towards goal achievement

This denition has elements found in a number of denitions from other researchers with an emphasis placed on inuencing activities to achieve set goals.
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BHS00156 TOPIC 1 WHAT IS LEADERSHIP?

As you read the literature on leadership, or if you have experienced it in a workplace setting over the last 2 decades, it seems clear that up until very recent times leadership in organisations has had two basically different focuses: leadership to get the job done and attain set goals leadership to inspire change and build new cultures.

The distinction between the two focuses was made by Burns (1978) when he coined the terms Transactional Leadership and Transformational Leadership.

Transactional Leadership
This view sees leadership as interpersonal inuence, that is, a manager inuencing people on a face-to-face basis to achieve set goals by providing the resources necessary and rewarding performance by formal and informal means. This is the more modest and traditional view of leadership which forms the basis of the leading function mentioned in the introduction as one of the traditional four functions of management.

Transformational Leadership
This view sees leadership as a broad, visionary activity which seeks to inspire and transform people in an organisation to identify with the organisation and be personally committed to its goals. Transformational leadership involves an emphasis on the leader actively trying to change the status quo and challenging the assumptions of the organisations culture and encouraging others to do so as well.

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BHS00156 LEADERSHIP

Activity 1

Observe three leaders. List each leaders characteristics in a way that will assist you to categorise their leadership style as transactional or transformational.

Characteristics
Leader 1 Leader 2 Leader 3

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BHS00156 TOPIC 1 WHAT IS LEADERSHIP?

Now categorise the leaders as transactional or transformational. Which focus do you perceive as the more effective? Comment briey.

Does this exercise tell you anything about organisational cultures? Comment briey.

Unfortunately transformational leadership is often seen as an activity exclusive to only the most senior managers and often exclusive to the chief executive ofcer (CEO). For example Peters and Watermans (1982) study of excellent companies in America found:
... that associated with almost every excellent company was a strong leader (or two) who seemed to have had a lot to do with making the company excellent in the rst place

Kouzes and Posner (1989) characterise the transformational leadership process as follows: Challenge current practices Search for opportunities to do new things or to do things differently; recognise the good ideas of others Experiment and take risks; learn from mistakes Inspire a shared vision Create a vision of a desired future situation which is intended to provide team members with a focus for their actions Enlist others through communicating commitment and condence Enable others to act Foster collaboration; develop commitment through shared experiences

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Strengthen others by developing a sense of ownership of the new directions Model the way Set the example; the leaders actions must be consistent with and reinforce the desired behaviours and values Plan small wins; break the change into small steps with a high chance of being accomplished and which can symbolise successful momentum Encourage the heart Recognise individual contributions Celebrate accomplishment.

Making Sense of Denitions

As you can see from the above denitions of transactional and transformational leadership, both concepts concern the status quo. Transactional leaders are said to maintain the status quo while transformational leaders challenge it. Bennis (1989) goes even further when he turns the transactional/ transformational leadership distinction into a distinction between a manager and a leader. Bennis sees leadership as an equivalent to management rather than being a component in the process of management as mentioned in the introduction. Both denitions also seem to imply that lower and middle level managers could only ever aspire to transactional leadership while transformational leadership is the exclusive property of very senior managers. More recent literature suggests that there is a need to see transactional and transformational approaches to leadership as complementary, to be used as managers deem appropriate. Dunphy and Stace (1990) argue that transformational leadership should be emphasised by managers during change processes and transactional leadership used to consolidate the change once it is successful. Rather than viewing these notions of leadership as being on opposite ends of a continuum to be pulled off the shelf according to the life cycle of the organisation, or for use during a change program it is my belief that managers at all levels should collapse both denitions and apply them to

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BHS00156 TOPIC 1 WHAT IS LEADERSHIP?

their management activities. For middle and lower level managers to accept and apply the transactional leadership style only in these times of rapidly changing environments will promote mediocrity and discontent within their work teams and the tendency to repeat past management mistakes. Karpin (1995:31) would agree with this perspective that leadership is an essential part of everyday management. The task force identied eight broad areas in which they saw Australian managers as needing to improve their skills. Leadership was but one of the areas identied:
The Task Force favours a very broad denition of leadership that includes inuencing task objectives and strategies, group identication and maintenance, and inuencing the culture of the organisation. From consultations and research, the Task Force has concluded in particular that the distinction between managers and leaders is increasingly irrelevant in the context of downsizing and attening organisational structures. In the future, all managers, irrespective of level, and indeed many employees, will need some leadership skills.

It is time now to revisit the general denition of leadership mentioned at the commencement of this section and expand it to encompass the challenges that face managers in the future. The words emphasised below have been added to the original denition to reect the challenge and responsibility of managers at all levels to be involved in transformational leadership. Leadership is: the process of inuencing the activities and attitudes of individuals and work teams towards goal achievement and continuous improvement and learning. In these difcult times managers face constant change and new demands such as global competition, rapidly changing technology, more demanding customers and calls to manage better with less. A new leadership style is needed to harness the skills, commitment and potential of all the people in the work team. Unless managers learn to lead people in a more responsive way on a daily basis our businesses will not achieve the performance levels and quality that is needed to survive these turbulent times. Accordingly, do not make too much of the transactional/transformational distinction. As with all models in organisational theory they tend to date, change and evolve. What is important is that you recognise the differences between the two denitions and identify those aspects which give you a better understanding of how to lead appropriately in a constantly changing environment.
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BHS00156 LEADERSHIP

Textbook and Reading 1 Turn to Chapter 1 of DuBrin, Dalglish & Miller (2005) and to Reading 1.

Activity 2 What in your mind constitutes leadership? Write a few sentences below detailing your preliminary thoughts.

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BHS00156 TOPIC 1 WHAT IS LEADERSHIP?

Activity 2 cont. Now turn to Readings 2 and 3. Is leadership in Australia different from leadership in other countries? Write your thoughts below.

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