Page 336 - Managing Change in Organizations

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Leadership and corporate politics
purpose is not to avoid conflict but, rather, to create a more open and collabora-
tive approach in order that conflict and politics can be handled constructively.
That is not to say that this always happens. Often, individuals (or even coalitions
of individuals) and departments pursue narrow interests. This seems to be
inevitable and even desirable. Without it people might lack the energy to argue,
question, put forward ideas and so on. What is needed is a credible way of mov-
ing forward amidst conflict. As we have already suggested, it seems likely that
longer-term credibility and organizational effectiveness flow from the ability to
establish a more balanced, constructive approach to conflict.

Leadership and corporate politics

The style and approach of the finance function is to be changed and this demands
leadership, partly to ‘sell’ the ideas throughout the function; partly to provide ‘role
models’ for other staff, i.e. leading through example; partly to manage the rela-
tionships between finance and other functions. No matter how gradually the
changes are made, people from other functions will recognize the different
approach and may exploit the new situation. Years of low trust and interdepart-
mental conflict leave a legacy.
The task of the leader in this situation is multi-faceted. We shall be dealing
with leadership, but because of the obvious relationships between leadership, the
constructive management of conflict, corporate politics and power I will deal
with these aspects briefly.
Few, if any, prescriptions for effective leadership can be offered. Leadership has
been linked to individual traits (e.g. intelligence and charisma) and to specific
types of behaviour (e.g. focus on the tasks, focus on the people). Currently, much
attention is devoted to contingency approaches to leadership, which link effec-
tive leadership to features of the situation in which leaders and others operate,
such as technology, organizational structure, the environment, characteristics
and needs of subordinates, etc. This approach leads us to suggest that leadership
style should be varied to meet the varying circumstances in which leaders lead.

Effective leadership is an elusive concept. In practice, it is also difficult to deter-
mine the criteria underpinning effective leadership. It is clearly linked to power.
The following concepts seek to identify the following five social bases of power:
1 Legitimate power: deriving from the manager’s position and therefore formal
authority.
2 Expert power: deriving from the knowledge and experience of the individual
(thus a doctor can influence the patient’s behaviour because he or she exerts
expert power when giving advice).
3 Referent power: deriving from the ways in which people identify with others
(often involves a charismatic individual).
4 Reward power: deriving from the individual’s control over rewards such as pay,
promotion and task assignments.
5 Coercive power: deriving from the capacity to sanction individual behaviour.

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