Management and Organizational Studies 1021A/B Chapter Notes -Correlation Does Not Imply Causation, Charismatic Authority, Transactional Leadership

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Published on 17 Apr 2013
School
Western University
Department
Management and Organizational Studies
Course
Management and Organizational Studies 1021A/B
MOS 1021B
The Nature and Importance of Leadership
Meaning of leadership
Ability to inspire
Stimulate others to achieve worthwhile goals
Ability to inspire confidence and support among the people who are needed to
achieve organizational goals
Interpersonal influence; through communication toward goals attainment
Influential increment over and above mechanical compliance with directions/orders
Influencing people by persuasion
Principal dynamic force that motivates and coordinates the organization in
accomplishing objectives
Willingness to take blame
Needed at all levels of organization
Ability to lead effectively is a rare quality
Leadership as partnership
Long-term relationship, or partnership, between leaders and group members
Leader and group members connected in a way that power between them is
balanced
From authoritarianism to shared decision making
4 things necessary for partnership
o Exchange of purpose
Defining vision and values at every level
o A right to say no
Expressing contrary opinions are not wrong
o Joint Accountability
Taking accountability for successes and failures
o Absolute honesty
Tell the truth as power is distributed
Leadership as a Relationship
A relationship between leader and people being led
Something you do with them, not to them
A major success factor for the three top positions in large organizations
Web of people > web of technology
Leadership versus management
Deals with interpersonal aspects of a manager’s job
Deals with change, inspiration, motivation and influence
Managers must know how to lead as well as manage
Key distinctions between management and leadership
o Management produces order, consistency, and predictability
o Leadership produces change and adaptability to new products, new markets,
new competitotrs, new customers and new work processes
o Leadership involves having a vision of what the organization can become and
mobilizing people to accomplish it
o Leadership eliciting cooperation and teamwork from people; keeping
people motivated by using persuasion
o Leadership produces change; management more likely to produce degree of
predictability and order
o Top level leaders transform organizations, top-level managers manage
organizations
o Leader creates vision to direct organization; manager implements the vision
Effective leaders have to be good managers themselves; or supported by effective
managers
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Effective leaders also manage, and effective managers also lead
The impact of leadership on Organizational performance
Leadership DOES make a difference
o Measuring impact of transactional (routine) ad charismatic (inspirational)
leadership on financial performance
o Results were
Transactional leadership not significantly related to performance
Charismatic leadership showed slight positive relationship with
performance
In an uncertain environment, charismatic leadership is more related
to performance
o CEOs influence 15 percent of total influence factors in a company’s
profitability or total return to shareholders
o Choice of CEO leader is as important as the choice of whether to remain in
the same industry or enter a different one
o Importance of enthusiasm, leadership and ability to work with people
o “You are required to have a vision of what the business can be, and
communicate that vision to the company officers and franchisees”
o Changes in leadership are followed by changes in company performance
o Leaders might be responsible for between 15 and 45 percent of a firm’s
performance
o Attribution theory attributing causality to leaders (successes and failures)
Leadership DOES NOT make a difference
1. Substitutes for leadership - factors in the work environment that provide
guidance and incentives to perform as substitutes for leaders; BUT usually
requires delegation by higher authority, guidance, encouragement and
support.
a. Closely knit teams of highly trained individuals
i. Directive leadership is seemingly unimportant
ii. When danger is highest, groups rely more on each other
b. Intrinsic satisfaction
i. Employees finding work strongly self-motivation or
intrinsically satisfying requires a minimum of leadership
c. Computer technology
i. Computer aided monitoring and computer networking takes
over leadership functions
ii. Productivity and quality data
iii. Directions for tasks
iv. Error detection, goal setting
d. Professional norms
i. Incorporation of strong professional norms often require a
minimum of leadership
2. Leadership Irrelevance
a. Prefer analysis of situation than presence of leader
b. Factors outside leader’s control have a larger impact on business
outcomes than do leadership actions
c. High-level leaders have control over only a few resources
d. Modern organization effective leadership means widespread
collaboration in obtaining ideas; authority and power are shared,
people lead themselves
e. Contrasted with leader constraint theory
3. Complexity Theory
a. Organizations are complex systems that cannot be explained by the
usual rules of nature
b. Little can be done by leaders to alter course of complex
organizational system
c. Outside forces determine a company’s fate
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Document Summary

Ability to inspire confidence and support among the people who are needed to achieve organizational goals. Influential increment over and above mechanical compliance with directions/orders. Principal dynamic force that motivates and coordinates the organization in accomplishing objectives. Ability to lead effectively is a rare quality. Long-term relationship, or partnership, between leaders and group members. Leader and group members connected in a way that power between them is balanced. 4 things necessary for partnership: exchange of purpose. Defining vision and values at every level: a right to say no. Expressing contrary opinions are not wrong: joint accountability. Taking accountability for successes and failures: absolute honesty. Tell the truth as power is distributed. A relationship between leader and people being led. Something you do with them, not to them. A major success factor for the three top positions in large organizations. Web of people > web of technology. Deals with interpersonal aspects of a manager"s job.

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