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BUSINESS MANAGEMENT BUT111C The Nature of Leadership Week 21


Title: BUSINESS MANAGEMENT BUT211C The Nature of Leadership Week 21 Author: WC Last modified by: WC Created Date: 9/17/2012 7:26:30 AM Document presentation format – PowerPoint PPT presentation

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Title: BUSINESS MANAGEMENT BUT111C The Nature of Leadership Week 21

LeadershipWeek 21
  • Among all the ideas and writings about
    leadership, three aspects stand out people,
    influence and goals.
  • Leadership occurs among people, involves the use
    of influence, and is used to attain
    organisational goals (Daft and Marcic, 2012).
  • Leadership is the process of influencing
    employees to work toward the achievement of
    organisational goals (Lussier 2009).
  • Leadership is based on interpersonal
    relationships, not administrative activities and
    directives (Hellriegel et al 2008).
  • Leaders have a substantive effect on an
    organisations overall performance.
  • Leadership should be considered at an
    organisational level- rather than individual CEO
    - level.
  • Leadership approaches need to evolve as the needs
    of organisations change.
  • A significant influence on leadership styles in
    recent years is the growing turbulence and
    uncertainty of the macro-environment (Daft and
    Marcic, 2012).

Leaders vs managers?
  • People tend to use the terms manager and leader
    interchangeably. However, managers are not
    necessarily strong leaders.
  • Some managers are not leaders because they do not
    have the ability to influence others.
  • Management is broader in scope than leadership
    leadership is only one of the four functions of
  • There are also good leaders who are not good
    managers, such as people holding informal
    authority. Many employees experience working in
    situations where one of their peers had more
    influence in the department than the manager.
  • A primary distinction between management and
    leadership is that management promotes stability
    and order within an existing organisational
    structure while leadership promotes vision and
  • Leadership means questioning the status quo so
    that outdated, unproductive, or socially
    irresponsible norms can be replaced to meet new
    organisational challenges.
  • Leadership cannot replace management it should
    be in addition to management.
  • Good management is needed to help the
    organisation meet current commitments, while good
    leadership is needed to move the organisation
    into the future (Daft and Marcic, 2012).

Leadership trait theory (Ghiselli Study)
  • Supervisory ability
  • Able to get the job done through others
  • Need for occupational achievement
  • Seeking responsibility
  • Having the motivation to work hard to achieve
  • Intelligence
  • Able to use good judgment clear reasoning
  • Decisiveness
  • Able to solve problems and make competent
  • Self-assurance / confidence
  • Viewing themselves as capable of solving problems
  • Initiative
  • Self-starter able to get the job done with a
    minimum of supervision

Traits Distinguishing natural personal
Strengths Natural talents and
abilities that have been supported and reinforced
with learned knowledge and skills.
Effective leadership Not about having the right
traits but rather about finding the strengths
that one can best exemplify and apply as a
leader. (Daft and Marcic, 2012).
Leadership development
  • On-the-job learning
  • Taking on jobs or projects that include
    leadership responsibilities
  • Formal assessment training
  • Leadership development programmes
  • Ongoing assessment to improve effectiveness as a
  • 360 degree feedback
  • Coaching mentoring
  • Senior colleagues provide advice and act as role
  • Can guide on the styles of leadership favoured in
    the organisation
  • Gaining off-the-job leadership experience
  • Taking on leadership roles in community and
    social organisations
  • Volunteering to make leadership contributions in
    religious and charity organisations

Theory X and Theory Y
  • Assumptions and beliefs about individuals and
    how to motivate them often influence a leaders

Theory X Managers
Theory Y Managers
  • Assume that employees basically dislike having to
    work and will perform well only if closely
  • Employees need direction wherever possible.
  • Managers must coerce employees to get them to do
    effective work.
  • Assume that people basically like to work and do
    not need close supervision.
  • Employees that are committed to the
    organisations goals will exercise
  • Employees will accept and even seek
    responsibility at work, wanting to make a
    positive contribution.

Two approaches to leadership
  • Leadership style based on leading by exchange.
  • Transactional leaders often excel at the
    management functions by stressing the impersonal
    aspects of performance, such as plans, schedules
    and budgets.
  • Transactional leadership is important to all
    organisations, but leading change requires a
    different approach (Daft and Marcic, 2012).
  • Promotes compliance !
  • Leadership style based on leading by motivating.
  • Significantly transform organisations as they
    bring about changes in mission, strategy,
    structure culture.
  • They also bring about innovations in processes,
    products and services.
  • Inspire followers to believe not just in the
    leader personally but in their own potential to
    imagine and create a better future for the

Transformational leadership
  • Leadership style that brings about continuous
    learning, innovation change through leading by
  • Transformational leaders provide extraordinary
    motivation by appealing to followers ideals and
    moral values and inspiring them to think about
    problems in new ways (Hellriegel et al 2008).
  • Many charismatic leaders are also
    transformational leaders but charismatic leaders
    are not transformational leaders unless they
    inspire continuous innovative change.
  • Transformational leadership has been shown to
    contribute to leader effectiveness, leader and
    follower satisfaction, improved follower efforts
    and better overall organisational performance.
  • Transformational leaders are typically positively
    engaged with the world around them and accomplish
    change by building networks of positive personal
    relationships (Daft and Marcic, 2012).

Behaviours of transformational leaders
  • Transformational leaders have an ability to
    create a vision that binds people around a strong
    sense of common purpose.
  • Transformational leadership motivates through
    identification with the leaders vision pulling
    rather than pushing others on (Warren Bennis)
  • Transformational leaders convey not just the
    value of their vision but an unshakeable belief
    that the organisation their followers are
    able to realise it.
  • Followers of transformational leaders tend to
    demonstrate unquestioning loyalty and obedience.
  • Framing is a process whereby leaders define the
    groups purpose in significant or meaningful
  • Employees work with a sense that they are making
    a difference in the community, society or even
    the world.
  • The groups purpose is defined in terms of the
    core values of the organisation.
  • Transformational leaders are often able to frame
    their vision in a way that gives employees a new
    purpose for working.
  • Impression management is the attempt to control
    the impressions that subordinates (and
    stakeholders outside the organisation) form about
    the leader.
  • Transformational leaders are able to align their
    vision with their person through effective
    impression management.
  • This is achieved through a strong communication
    competency and ensuring that their behaviour
    lives their values and supports the declared

Contemporary leadership concepts
  • 1. Level 5 Leadership Leadership that is
    characterised by an almost complete lack of ego
    (humility), coupled with a fierce resolve / will
    to do what is best for the organisation (Collins,
  • 2. Servant leadership A servant leader
    transcends self-interest to serve others and the
    organisation. Servant leaders operate on two
    levels for the fulfillment of their
    subordinates goals and needs and for the
    realisation of the larger purpose or mission of
    their organisation.
  • 3. Authentic leadership Leadership by
    individuals who know and understand themselves,
    who espouse and act consistently with higher
    order ethical values, and who empower and inspire
    others with their openness and authenticity.
    Inspire trust and commitment. In followers
  • 4. Interactive leadership Leaders that favour a
    consensual and collaborative process, exerting
    influence that derives from relationships rather
    than position and formal authority.

Research on women in leadership
  • Research indicates that womens style of
    leadership is (1) typically different from most
    mens leadership styles and (2) is particularly
    well suited to todays organisations (Daft and
    Marcic, 2012).
  • Using data from actual performance evaluations,
    one study found that when rated by peers,
    subordinates and bosses, female managers scored
    significantly higher than men did abilities such
    as motivating others, fostering communication,
    the production of high-quality work and listening
    to others (Sharpe, 2000).
  • A recent study of leaders and their followers in
    businesses, universities, and government agencies
    found that women were rated higher on social and
    emotional skills, which are crucial skills for
    both emotional intelligence and interactive
    leadership (Groves, 2005).
  • A 2009 review of thousands of 360-degree
    performance evaluations revealed that women
    outshone men in almost every leadership dimension
    measured with the one exception that women
    leaders were often rated as less visionary
    (Ibarra and Otilia, 2009).

Types of leadership power
  • Power is the potential ability to influence the
    behaviour of others (Daft and Marcic, 2012). The
    power available does not need to be used often
    the perception of power is enough to influence
  • Leaders use power to get things done in
    organisations. Leadership and power therefore go
    hand-in-hand. To influence others, leaders need
    to exercise some form of power.
  • Employees are not influenced without a reason
    the reason often is the power that a leader
    exerts over them. Without some form of power,
    managers are not able to achieve organisational
  • Generally, power in organisations is allocated to
    those who get results and have good interpersonal

Types of leadership power
  • French Raven 1959 developed a framework for
    understanding the forms of power used by leaders
    in influencing followers.
  • Identified five types of leadership power
  • Legitimate power
  • Coercive power
  • Referent power
  • Reward power
  • Expert power
  • Effective leaders may find it necessary to use
    more than one type of power at different times
    and for different occasions.

1. Legitimate power
  • Definition Influence based on the leaders
    formal position in the organisations hierarchy.
    Employees feel that they ought to do what the
    boss says because of the position that they hold.
  • Access to resources, information and key decision
    makers gives some leaders legitimate power in
    influencing events as well as passing on
    information and rewards to subordinates.
  • Such leaders are often described as having
    clout or political influence within an
    organisation. Legitimate power can
  • Get a good job for a talented employee
  • Obtain approval for expenditures beyond the
  • Provide easy access to top people in the company
  • Ensure early awareness of important decisions and
    policy shifts

Pinky Moholi
Koos Bekker
2. Coercive power
  • Definition Influence based on fear and
  • Coercive power is less effective than a
    legitimate, reward or referent power because
    punishment is less effective as a motivator.
  • Coercive power may be appropriate when enforcing
  • Punishment may take the form of
  • Less desirable work assignments
  • Verbal reprimands or written warnings
  • Demotions, suspensions or terminations
  • Humiliation, criticism
  • Limiting chances of promotion
  • Employees may respond to coercion
  • by exhibiting negative behaviour
  • (such as falsifying performance reports)
  • rather than improving their performance.

Change before you have to Jack Welch
3. Referent power
  • Definition Influence based on followers
    personally identifying with the leader. Followers
    tend to like, admire and want to emulate their
  • Leaders who have admirable personal
    characteristics, charisma, and an excellent
    reputation often possess referent power.
  • Referent power sometimes used by people with no
    positional power in organisations using
    requests rather than orders.
  • Referent power can be gained in organisations by
    developing interpersonal skills and developing
    the confidence that other employees have in you.

Nelson Mandela
Winston Churchill
4. Reward power
  • Definition Influence based on the leaders
    ability to bestow rewards on other people.
    Leaders using reward power let people know what
    is in it for them by creating win-win situations.
  • Employees act on the supervisors request because
    they believe that their behaviours will be
    rewarded. To increase their reward power,
    managers must be in a position to evaluate
    employees performance and determine their raises
    and promotions.
  • Rewards may take many forms, including
  • Praise, attention
  • Recognition
  • Favourable job assignments
  • Preferred vacation schedules
  • Promotions
  • Salary increases

Bill Gates
5. Expert power
  • Definition Influence based on specialised
    knowledge skill regarding the tasks being
    performed is regarded as expert power.
  • When someone is a true expert, others go along
    with their recommendations because of his or her
    superior knowledge.
  • The fewer people who possess certain expertise in
    an organisation, the more power the individual
    who does have it gains.
  • Followers as well as leaders can possess expert
    power. Being an expert makes employees depend on
    you and employees with expert power are often
    promoted to management positions.

Warren Buffet
Steve Jobs
Using power effectively
  • Legitimate power is effective when a manager
    simply requires an employee to perform a task
    that is within the employees capabilities and
    job description.
  • Coercive power may be effective to get employees
    to comply with rules but, in general, when
    leaders threaten to punish the response from
    subordinates is often angry and negative.
  • Referent power usually leads to high levels of
    performance, hence effective leaders are likely
    to rely on expert, referent and reward power,
    using legitimate and coercive power only

How subordinates respond to the use of leadership
  • Leadership matters, but without effective
    followers no organisation can survive. Leaders
    can develop an understanding of their followers
    and create the conditions that help them to be
    most effective (Daft and Marcic, 2012)
  • The leaders use of different types of power can
    lead to three distinct types of behaviour in
  • Commitment
  • Committed subordinates are enthusiastic about
    meeting their leaders expectations and strive to
    do so.
  • Compliance
  • Subordinates who merely comply with their
    leaders requests will do only what has to be
    done usually without much enthusiasm.
  • Resistance
  • Subordinates may appear to respond to their
    leaders requests while not actively doing so or
    even intentionally delaying or sabotaging

Tutorial group exercise
  • To what extent to you believe that the types of
    power used by an individual leader reveal a great
    deal about why others follow that particular
  • As a group will need to identify the two
    theoretical approaches you believe are most
    useful to managers operating in SA - and which
    two are the least useful
  • Legitimate power?
  • Coercive power?
  • Referent power?
  • Reward power?
  • Expert power?
  • Due 3 October 2012

The types of power used by a leader reveals a
great deal about why others follow that
individual leader
Why others follow this type of leader

Legitimate Power Followers
Coercise Power Followers
Referent Power Followers
Reward Power Followers
Expert Power Followers
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