CHAPTER FIVE

Concept Of Leading
• There is a profound difference between manager and leader, and both are essential in a sound
management system. To ‘manage’ means “to bring about, to accomplish, to have charge of or
responsibility for, to conduct”.
• On the other hand the ‘Leading’ is “influencing, guiding in direction, course, action, opinion”.
• Leadership is the process of influencing an organized group towards a common goal.
• The workable definition that a leader is one who leads others and is able to carry an individual
or a group towards the accomplishment of a common goal. He is able to carry them with him,
because he influences their behaviour. He is able to influence their behaviour, because he enjoys
some power over them. They are willing to be influenced, because they have certain needs to
satisfy in collaboration with him.
• Leadership is an interpersonal influence directed toward the achievement of a goal or goals.
• Interpersonal: a leader has more than one person (group) to lead.
• Influence: is the power to affect others.
• Goal: is the end one strives to attain.
 Leadership-is the process of influencing employees to work toward the achievements of
organizational objectives.
 Meaning and need for leadership
• It is the process by which a person exerts
influence over other people; and inspires,
motivates, and directs their activities to help
achieve group or organizational goals.
• Is the process of influencing individuals to set
and achieve goals
• Management and leadership are not the same.
• Managers plan, organize, staff, lead, and control.
They may or may not be effective in influencing
their subordinates or team members to set and
achieve goals.
• Leaders, on the other hand are involved in
single function of management that is leading
they are individuals who are able to exert
influence over other people to achieve
organizational objectives.
• Leadership involves creating and sharing
of visions, generating strategies to bring
visions to realize.
• Therefore, leaders and managers are
not necessarily the same; it is mainly
because leading perform only one
aspect of management functions.
• Managers can be leader because they
can perform leading function. But may
not be effective leaders since they may
not have enough ability to influence
others.
 What Are The Foundations For Effective Leadership?

“A leader lives in each of us” Foundations For Effective Leadership

• Leadership is one of the five functions of
management.

• Leadership relies on use of position power and

personal power.

• Leadership traits and styles can influence leadership

effectiveness.

• Fiedler’s contingency model matches leadership

styles with situational differences.
 Skills Of Effective Leaders
 Building and sustaining relationships

 Developing and communicating a vision

 Influencing people

 Making decisions

 Overcoming setbacks and adversity

 Understanding people’s needs

7
 Good Leaders Always…

• Challenge people to think • Measure and reward performance

• Communicate clear expectations • Properly allocate and deploy talent
• Lead by example • Provide continuous feedback-positive
• Make decisions and negative
• Make others feel safe to speak up

• Are accountable to others

• Genuinely enjoy responsibility
• Are great teachers
• Invest in relationships
• Ask questions and seek counsel
• Problem solve without procrastinating
• Create a positive, energetic atmosphere
8
 LEADERSHIP THEORIES
A. Great Man theories

• Great man theories assume that the capacity for leadership is inherent – that great
leaders are born, not made.

• These theories often portray great leaders as heroic, mythic and destined to rise to
leadership when needed.

• The term "Great Man" was used because, at the time, leadership was thought of
primarily as a male quality, especially in terms of military leadership.

• Such theories suggest that people cannot really learn how to become strong leaders. It's
either something you are born with or born without.
 LEAD ERSH IP THE OR IE S
B.Trait theories
• Similar in some ways to Great Man theories, trait theories assume that people inherit
certain qualities and traits that make them better suited to leadership.
• The trait theory focused on identifying the personal characteristics that are responsible
for effective leadership.
• According to this theory effective leaders must have the following traits;
• Intelligence-helps managers understand complex issues and solve problem,
• Self confidence-contributes to managers effectively influencing subordinates and persisting
when faced with difficulties.
• Integrity and honesty-helps managers behave ethically and earn their subordinates trust
and confidence.
• Physical traits-such as height, appearances etc.
• Social traits such as cooperativeness skill etc.
• Traits alone however, are not the key to understand leader effectiveness. Some effective leaders do not
possess all of these traits, are some leaders who do possess them but not effective in their leadership roles.
 LEAD ERSH IP THE OR IE S
C. Situational Theories
• Situational theories propose that leaders choose
the best course of action based upon situational
variables.
• Different styles of leadership may be more
appropriate for certain types of decision-making.
• For example, in a situation where the leader is the
most knowledgeable and experienced member of a
group, an authoritarian style might be most
appropriate. In other instances where group members
are skilled experts, a democratic style would be more
effective.
• Situational theories propose that leaders choose
the best course of action based upon situational
variables.
• Different styles of leadership may be more
appropriate for certain types of decision-making.
• Fiddler’s contingency model suggests that managers
should choose task or employee focus depending on
the interaction of three situation variables: leader
member relation, task structure, and leader position
power.
o Leader-member relations:- the extent to which
followers like, trust, and are loyal to their leader is
determinant of how favorable a situation for leading.
If leader-member relations are good situations are
good for leading. If relation is poor, the manager may
have to resort to negotiation or to promising favors
to get performance.
o Task structure: - The extent to which the work to
be performed is clear-cut. When task structure is high,
situations are favorable for leading. When task
structure are low, goals may be vague, subordinates
may be unsure of what they should be doing or how
they should do it, and the situation is unfavorable for
leading.
o Position power: This is the amount of power you have to
direct the group, and provide reward or punishment. The
more power you have, the more favorable your situation.
 LEAD ERSH IP THE OR IE S
D. Theory X and Theory Y-assumptions
• Are assumptions about human nature
developed by Douglas Mc Gregor. He
developed the assumptions based on the
attitude that managers have about workers.
Theory - X assumes the following:
 The average worker is lazy, dislikes job, and will
avoid work whenever possible
 Because most people dislike work, they have to
be closely supervised and threatened with
punishment to reach objectives.
 Above all people want security
 Average people prefer to be directed, wish to
avoid responsibilities and they have little
ambition.
 Theory-Y assumes the following
o Most people find work as natural as play or
rest and develop an attitude toward work
based on their experience with it.
o People do not need to be threatened with
punishment; they will work voluntarily toward
organizational objectives to which they are
committed.
o The average person working under proper
condition not only to accept but also to seek
responsibility.
o Managers should decentralize authority to
employees and make sure employees have the
resources necessary to achieve organizational
goals
 LEADERSHIP THEORIES

E.The Behavioral Theory

• Behavioral studies had their roots in the • Work centered leaders are leaders who
Ohio State University and university of are authoritarian, autocratic, production
Michigan by careful study of the behaviors
of specific leaders. oriented and activity focused.
• This theory tried to identify the
behaviors shown by leaders in the work • Employee-centered leaders are also
environment and they were generally able known as democratic, considerate,
to identify two sets of leaders.
consultative and participative leaders.
• Work centered (concerned for task)
leaders; and employee-
centered(concerned for employee) • They tend to share decisions with
• Work centered (concerned for subordinates, encourage participation, and
task) leaders : This approach is also
support the team work needed for high
refereed to as initiating structure, job
centeredness and task orientation. levels of task accomplishment.
 LEADERSHIP STYLES
• The Leadership Styles are the
behavioral patterns that a leader adopt to
influence the behavior of his followers, i.e.
the way he gives directions to his
subordinates and motivates them to
accomplish the given objectives.
• Leadership style is the manner and
approach of providing direction,
implementing plans, and motivating
people.
• Based on the degree to which managers
share decision making authority with
subordinates, leadership styles can be
classified in to three:
• Autocratic, Democratic, and Laissez-faire
Authoritarian or Autocratic Leadership:
Rarely Effective
• Autocratic style- a leadership style in which a
manager does not share decision-making
authority with subordinates.
• Managers, who tend to be heavily work –
centered, placing most of their emphasis on
task accomplishment and little on the human
elements.
• Some of the appropriate conditions to use
this style is when you have all the information
to solve the problem, you are short on time.
• The authoritarian style should normally only
be used on rare occasions. If you have the
time and want to gain more commitment and
motivation from your employees, then you
should use the participative style.
 L E AD E R SHIP S T YL E S
• Autocratic leadership style is
characterized by:
 Managers’ emphasis on close
control
 Managers’ willingness to delegate a
very little decision-making authority.
 No flow of information from
subordinates (Leader- subordinate
relation ship is characterized by
order giving on the leader’s part).
 Sensitivity of managers about their
authority.
 Leader’s assumption that payment is
a just reward for working
Democratic Leadership style: Commonly
Effective
• It is a leadership approach in which a manager
shares decision making authority with
subordinates.
• Managers who have high concern for both
people and work practice it.
• In democratic leadership managers:
o Are not much sensitive about their authority
o Participate employees in decision making
o Appreciate suggestions from subordinates
o Exercise broad supervision
o Motivate subordinates with rewards
 LEADERSHIP STYLES
 Laissez-Faire(Free-Rein Style): Sometimes
Effective
• The French term "laissez faire" literally translates
to "let them do," and leaders who embrace it
afford nearly all authority to their employees.
• It is a leadership approach in which a manager
develops a frame work for subordinates in which
they can act and leave decision making authority to
the subordinates and remain for consultation.
• It is employed by managers who are basically
uninvolved in the operations of the unit.
• This type of leadership is mostly applied in
organizations with highly skilled and well-trained
professional.
• Although laissez-faire leadership can empower
employees by trusting them to work however
they'd like, it can limit their development and
overlook critical company growth opportunities.
Therefore, it's important that this leadership style
is kept in check.
 Situational Leadership style:
• Is leadership approach in which managers utilize the
combination of the above style depending on the
situation in external environment.
• Situational leadership is flexible. It adapts to the
existing work environment and the needs of the
organization.
• Situational leadership is not based on a specific skill
of the leader; instead, he or she modifies the style of
management to suit the requirements of the
organization.
• One of the keys to situational leadership is
adaptability.
• Leaders must be able to move from one leadership
style to another to meet the changing needs of an
organization and its employees.
• These leaders must have the insight to understand
when to change their management style and what
leadership strategy fits each new paradigm.
 LEADERSHIP STYLES
 Transactional Leadership style
• A leadership style which lays emphasis on the transaction
between leader and its subordinates. The only
'transaction' between the leader and the followers is the
money which the followers receive for their compliance and
effort.
• It is a leadership style that employs rewards and
punishments for motivating followers.
• Leader lays emphasis on his relation with followers.
• It works for developing the existing organizational culture.
• It is a leadership style whereby the objectives and goals
are predefined and the leader uses reward and
punishment to motivate his followers.
• More concerned with maintaining the normal flow of
operations- this style is best described as “keeping the
ship afloat.”
• The term “transactional” refers to the fact that this type
of leader essentially motivates subordinates by exchanging
rewards for performance.
• A transactional leader generally does not look ahead in
strategically guiding an organization to a position of
market leadership; instead, these managers are often
concerned with making sure everything flows smoothly
today.
 Transformational Leadership style
• In this style, the leader works with the subordinates to ascertain
the desired change in the organization.
• It is a leadership style in which the leader employs charisma and
enthusiasm to inspire his followers.
• Leader lays emphasis on the values, ideas, morals and needs of
the followers.
• It works for changing the existing organizational culture.
• A transformational leader goes beyond managing day-to-day
operations and crafts strategies for taking his company,
department or work team to the next level of performance and
success.
• Transformational leadership styles focus on team-building,
motivation and collaboration with employees at different levels of
an organization to accomplish change for the better.
• These leaders set goals and incentives to push their subordinates
to higher performance levels, while providing opportunities for
personal and professional growth for each employee.
• In transformational leadership, the leader acts as a role model
and as a motivator too who offers vision, excitement,
encouragement, morale and satisfaction to the followers. The
leader inspires his people to increase their abilities and
capabilities, build up self-confidence and promotes innovation in
the whole organisation.
How Do You Determine What Is An
How Do You Choose And Develop
Appropriate Style?
A Leadership Style?
• Good leaders usually have a style that they
 Start with yourself.
consciously use most of the time, but they're not
rigid. They change as necessary to deal with  Think about the needs of the organization or
whatever comes up. initiative.

• Be consistent with what people in the organization
expect.
• Your style needs to be consistent with the goals,
mission, and philosophy of your organization.
 Observe and learn from other leaders.
 Use the research on leadership.
 Believe in what you're doing.
 Be prepared to change.
 FACTORS AFFECTING STYLE

• Leadership style may be dependent on various factors:

• Risk:- decision making and change initiatives based on degree of risk
involved

• Type of business:- creative business or supply driven?

• How important change is:- change for change’s sake?

• Organisational culture:- may be long embedded and difficult to change

• Nature of the task:- needing cooperation? Direction? Structure?

 Motivation
• Motivation: an internal drive that causes
people to behave in a certain way to meet a
need. • The force within us that activates our behavior.
• Motivation It is a function of three distinct components,
Intensity, Direction, and Persistence.
• Individual forces that account for the direction,
level, and persistence of a person’s effort
expended at work.
• Direction - an individual’s choice when
presented with a number of possible
alternatives. Motivation
• Level/intensity - the amount of effort a person
puts forth.
• Persistence - the length of time a person sticks
with a given action.
• Motivation comes from within Intensity Direction Persistence
• There are several factors that contribute to
motivation (not just monetary)
 Motivation

• Motivation - Intensity
• Intensity refers to the amount of mental and physical
effort put forth by the person.

Motivation – Direction:
The extent to which an individual determines and
chooses efforts focused on a particular goal.

Motivation - Persistence
The extent to which the goal-directed effort is put forth
over time.
 The Needs Theories Of Motivation
Motivation
Maslow In The Workplace
Self-actualization—Expand Skills
Esteem—Recognition/Respect
Social—Informal Groups
Safety—Job Security/Environment
Physiological—Basic Wages
Assumptions
1. Only unsatisfied need can influence
behavior: satisfied need is not a motivator
2. A persons needs are arranged in a priority
order of importance in hierarchical forms
3. A person will at least minimally satisfy
each level of need before filling the need
at the next level
4. If need satisfaction is not maintained at
any level the unsatisfied need will become
priority ones again.
 Need Theories: A Comparison

Growth needs

5. Self-actualization needs
• Growth needs
4. Esteem needs
Deficiency Needs

3. Social needs • Relatedness needs

2. Safety needs
• Existence needs

1. Physiological needs

Maslow’s need hierarchy theory Alderfer’s ERG theory

The Needs Theories Of Motivation

Alderfer’s ERG
Existence: Theory of
Motivation
Desire for physiological
and material well-being

Growth: Relatedness:
Desire for continued
personal growth and Desire for
development. satisfying
interpersonal
relationships
 The Needs Theor ies Of M ot iva t ion

McClelland’s Three Needs Theory/

Acquired needs theory
Acquired needs theory
• Need for achievement (nAch).
• The desire to do something
better or more efficiently, to
solve problems, or to master
complex tasks.
• Need for affiliation (nAff).
• The desire to establish and
maintain friendly and warm
relations with others.
• Need for power (nPower).
• The desire to control others, to
influence their behavior, or to be
responsible for others.
Two-Factor Theory
• Two-Factor Theory
• Identifies two different factors as primary causes of job
satisfaction and job dissatisfaction.
• Also known as the motivator-hygiene theory.
Hygiene factors
• Sources of job dissatisfaction associated with job context.
• Job dissatisfaction results when hygiene factors are poor.
• Improving the hygiene factors only decreases job
dissatisfaction.
• Motivator factors
• Sources of job satisfaction related to job content.
• Presence or absence of motivators is the key link to satisfaction.
S ourc e s o f D issat isfact io n a nd S a t isfaction in
H e r z ber g’s Two - fact or T he o r y.

• Policies
• Salary
Hygiene • Supervision
Factors •
•
Work conditions
Relationships
• Status

• Achievement
• Recognition
Motivator • Meaningful work
Factors •
•
Responsibility
Advancement
• Growth
 Equity Theor y of Motivation
Equity Theory
Any perceived inequity becomes
a motivating state of mind.
• People are motivated to
behave in ways that
restore equity in
situations.
• Foundation of equity is
social comparison.
Equity theory prediction:
• Negative inequity.
• Individual feels he/she has received relatively
less than others in proportion to work inputs.
• Positive inequity.
• Individual feels he/she has received relatively
more than others in proportion to work
inputs.
 Expectancy Theory of Motivation
Expectancy
Improve Improve Improve
• A person’s motivation is a • effort will yield acceptable performance Expectancy Instrumentality Valence
multiplicative function of Instrumentality Employees must
Tie reward to
expectancy, instrumentality, possess the skills
for task
performance
Assure that
reward is
and valence (M = E x I x V). • performance will be rewarded meaningful
Provide necessary Observe and
• Motivational implications Valence training recognize

of expectancy theory. • value of the rewards is highly positive Give rewards that
Assign reasonable Deliver as have value
• Motivation is sharply tasks and goals promised

reduced when,
expectancy,
instrumentality, or F i g . V i c t o r V r o o m ’s E x p e c t a n c y T h e o r y
valence approach
zero.
• Motivation is high
when expectancy and
instrumentality are
high and valence is
strongly positive.
 Goal-setting Theory of Motivation
Goal setting Management by Objectives
• Process of joint goal
• The process of developing, negotiating, and formalizing setting between a
the targets or objectives that a person is responsible for supervisor and a
subordinate.
accomplishing.
• Difficult goals are more likely to lead to higher performance
than are less difficult ones.
• Specific goals are more likely to lead to higher performance
than vague or very general ones.

Task feedback is likely to motivate people toward higher performance by encouraging the setting of
higher performance goals.
Goals are most likely to lead to higher performance when people have the abilities and the feelings of
self-efficacy required to accomplish.
Goals are most likely to motivate people toward higher performance when they are accepted by
the individual, and there is commitment to them.
 Leadership Communication
• Leadership communication is the controlled, purposeful transfer of meaning by which individuals influence a single person, a
group, an organization, or a community.
• Leadership communication requires using the full range of communication abilities and resources to;
• Connect positively with audiences
• Overcome interferences
• Create and deliver messages that guide, direct, motivate, or inspire others to action
• What is involved in communication?
• Leaders communicate to share the vision with others, inspire and motivate them to strive toward the vision, and build the
values and trust that enable effective working relationships and goal accomplishment.
• Leadership communications consists of those messages from a leader that are rooted in the values and culture of an
organization and are of significant importance to key stakeholders, e.g., employees, customers, strategic partners,
shareholders, and the media. . Messages reflect vision, mission, and culture.
• Organizational communication flows is absolutely essential skill for anyone who occupies a leadership role in the
organization.
• Effective leadership requires knowing how to communicate with all elements of the organization, including employees,
managers, customers and investors. Each group may require a different communication style and leadership style. Leaders
must be able to adapt based on the group they are communicating with at the time. Effective communication skills are an
important aspect of any leader’s portfolio of skills and experience.
Einstein
Quotes
 END OF
CHAPTER FIVE

CHAPTER SIX:
THE CONTROLLING FUNCTION