Page 480 - Encyclopedia of Business and Finance

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Leadership

When necessary, leadership has to defend the organiza- consideration (employee-centered) would be successful
tion’s integrity. and effective in all circumstances.
Many students of leadership in the twenty-first cen-
CHARACTERISTICS OF tury believe that there is no one best way to lead, believ-
SUCCESSFUL AND EFFECTIVE ing instead that appropriate leadership styles vary
LEADERSHIP depending on situations. Fred Fiedler (1967), for
What does it take to make leadership successful or effec- instance, believes that a task-oriented leadership style is
tive? Early students of leadership examined great leaders appropriate when the situation is either extremely favor-
able or extremely unfavorable to the leader. A favorable
throughout history, attempting to find traits that they
situation exists when the relationship between the leader
shared. Among personality traits that they found were
determination, emotional stability, diplomacy, self-confi- and followers is good, their tasks are well-defined, and the
dence, personal integrity, originality, and creativity. Intel- leader has strong power. When the opposite is true, an
lectual abilities included judgmental ability, knowledge, unfavorable situation exists. When the situation is moder-
ately favorable, a people-oriented leadership style is appro-
and verbal communication ability. In addition, physical
priate. Some theorists suggest that situational factors—the
traits cannot be ignored, such as age, height, weight, and
type of task, nature of work groups, formal authority sys-
physical attractiveness.
tem, personality and maturity level of followers, experi-
It is not only inborn personality traits that are impor- ence, and ability of followers—are critical in determining
tant but also styles and behaviors that a person learns.
the most effective leadership style. For instance, when fol-
Strong autocratic leaders set their goals without consider-
lowers are inexperienced and lack maturity and responsi-
ing the opinions of their followers, then command their
bility, the directive leadership style is effective; when
followers to execute their assigned tasks without question. followers are experienced and willing to take charge, sup-
Consultative leaders solicit the opinions and ideas of their portive leadership is effective.
followers in the goal-setting process but ultimately deter-
mine important goals and task assignments on their own.
Democratic or participative leaders participate equally in LEADERSHIP IN A MULTICULTURAL
SETTING
the process with their followers and let the group make
decisions. Extremely laid-back leaders, so called laissez- One major situational factor is the cultural values of the
faire leaders, let the group take whatever action its mem- followers. People who have different cultural norms and
bers feel is necessary. values require different leadership styles. In a highly col-
lective society such as Japan, the Philippines, Guatemala,
Inspired and led by Renis Likert, a research team at
or Ecuador, where the social bond among members is very
the University of Michigan studied leadership for several
strong and people look out for one another, a strong patri-
years and identified two distinct styles, which they
referred to as job-centered and employee-centered leader- arch at the top of the social hierarchy tends to emerge as
ship styles. The job-centered leader closely supervises sub- an effective leader. Such a leader is not only accepted by
the followers but is also expected to protect their interests.
ordinates to make sure they perform their tasks following
the specified procedures. This type of leader relies on China’s Deng Xiao-Ping, whose influence continues even
after his death, is a case in point.
reward, punishment, and legitimate power to influence
the behavior of followers. The employee-centered leader On the other hand, in an extremely individualistic
believes that creating a supportive work environment ulti- society, such as the United States (Hofstede, 1984), where
mately is the road to superior organizational performance. the social bonds are loose and individuals are expected to
The employee-centered leader shows great concern about take care of themselves, success and achievement are
the employees’ emotional well-being, personal growth and admired, and a competitive and heroic figure is likely to
development, and achievement. emerge as a leader. It is no surprise that John F. Kennedy
became such a charismatic figure in the United States. His
A leadership study group at The Ohio State Univer-
energetic and inspirational speeches are still vividly
sity, headed by Harris Fleishman, found similar contrasts
remembered.
in leadership style, which they referred to as initiating
structure and consideration. The leadership style of initi-
ating structure is similar to the job-centered leadership CHARISMATIC AND
style, whereas consideration is similar to the employee- TRANSFORMATIONAL LEADERSHIP
centered leadership style. It was the initial expectation of Regardless of culture and time, however, a great leader is
both research groups that a leader who could demonstrate remembered for his or her charisma, which means
both high initiating structure (job-centered) and high “divinely inspired gift” in Greek. Charismatic leaders have

ENCYCLOPEDIA OF BUSINESS AND FINANCE, SECOND EDITION 457