Theories and Performance Imperatives of Organizational Leadership - Research Paper Example

?LEADERSHIP: Theories and Performance Imperatives of Organizational Leadership Introduction In organizations and work settings, positions of leadership are established to help the organization optimally achieve its performance goals. Similarly, leadership of subunits in an organization contribute to the fulfillment of best outcomes in the larger system. Organizational purpose provides the direction for collective action. Leadership processes “are directed at defining, establishing, identifying, or translating this direction for their followers, and facilitating or enabling the organizational processes” (Zaccaro & Klimoski, 2001, p.6) towards achieving this purpose. Leadership processes are closely related to the continual development and attainment of organizational goal states, which are based on the firm’s purpose, mission, vision, strategy, plans and tasks. Earlier theories of leadership emphasized rational processes, whereas the new theories emphasize emotions and values necessary to influence followers to commit to ideological objectives and to achieve high levels of success. Weaknesses can occur from the earlier approach in the conceptualization and measurement of leadership processes, in the omission of leader behaviors, the neglect of group and organizational processes, and over-reliance on weak research methods. For example, using two-factor models to describe leadership, such as autocratic versus participative leadership or transformational versus transactional leadership oversimplify the complexity of effective leadership, and encourage stereotyping of individual leaders (Yukl, 1999). Thesis Statement: The purpose of this paper is to investigate theories and performance requirements for achieving effective organizational leadership. Effective Leadership in Organizations Effective leaders support the optimal performance of a group of subordinates. They add great value to an organization. Highly effective executives who are also known as peak performers are noted to have productivity rates that are 25 to 50 percent higher than their average or poorly performing counterparts. Highly effective leadership is characterized by productivity, health, relational behaviour, or a combination of these factors, which result in performance at optimal level (Sperry, 2003). The main goals of effective leadership are: facilitating organizational goal setting and helping to achieve them, promoting optimal levels of individual motivation, commitment and satisfaction, facilitating effective interactions among individuals within teams, helping employees to set high goals for themselves, and place the organization’s effectiveness above their own self-interests (Anderson, Ones, Sinangil et al, 2001). The effective leader operates simultaneously on the performance as well as the people of the organization or unit. Performance includes the process of how things get done, the length of time taken, as well as the outcome of productivity and quality. The aim of performance is productivity, and the aim for people is health. The effective leader operates both requirements successfully, emphasizing both productivity and health. Productivity is the ratio of input to output; and increased productivity has beneficial outcomes such as higher profits and market share. On the other hand, people encompasses the skills, talents, competencies and needs of the employees, leaders and other stakeholders involved with a particular corporation or organization. Health is similar to productivity in being a measure of outcome, and is manifest in both the individual as well as the corporation. For individuals, health includes physical and psychological well-being, job satisfaction, and other factors (Sperry, 2003). Thus, the fundamental premise regarding effective leadership is that it is a function of both productivity and health, and they are inter-connected. By realizing the importance of the people dimension, the effective leader ensures that employees’ levels of commitment and morale remain high, burnout does not occur, and expenditure on health is reduced. The second basic premise of effective leadership is that it significantly influences corporate effectiveness which is connected to corporate productivity and health. The third basic premise of effective leadership is that corporations are continually searching for better strategies to increase leadership effectiveness to maximise corporate productivity and health (Sperry, 2003). Strategic leadership adds value by raising the organization’s competitive advantage. Leaders’ ethics and character are important for effective leadership, and “important determinants of effective leader-follower relations are prosocial motives, morality and trustworthiness” (Weiner, Freidheim, Gallagher, et al, 2003, p.284). Prosocial leaders as opposed to self-centered leaders, are empathetic, self-sacrificing, trustworthy, considerate and focused on building collective missions. At the core of leadership are the personality, values and emotional commitment of the leader. Further, translating the leader’s personal ethics into action also contribute to leadership style. Effective safety leadership combines leadership style or how the leader influences, with best practices of observable behaviors that work best on a daily basis (Krause, 2007). Organizational design helps organizational leadership to contribute to the firm’s competitive advantage. All large-scale organizations have to take into consideration the efficient utilization of their human resources. Top-level executives and leaders have developed complex frames of reference, or mental models, by reflective processing of information requiring higher orders of abstraction. The mental models operate like small decision support systems, containing patterned representations of the real dynamic systems within which these top-level leaders function. With greater breadth and richer interconnections between the elements of the model, “the greater the likelihood is that the model can be used to detect patterns in the complex flux of events in the strategic world” (Zaccaro & Klimoski, 2001, p.75). Thus, organizational design plays an important part in determining leadership activities, and promotes organizational performance. Leadership Styles Leadership style pertains to “how the leader approaches opportunities, what he or she chooses to emphasize, to defer and to delegate to others” (Krause, 2007, p.19). Research evidence indicates transformational style as the most beneficial for driving safety and for creating a high performance culture. The developmental nature of this style helps leaders achieve optimal outcomes by influencing, motivating, and inspiring employees over whom direct supervision may or may not be possible. The four dimensions of transformational leadership include influencing, engaging, inspiring and challenging the subordinate employees in the organization. Influencing establishes the core credibility and principled action vital to the development of relationships; engaging creates relationships based on mutual respect and understanding; inspiring propels these relationships toward an improved future; and challenging helps eliminate habits that obstruct the achievement of excellence. Transformational leadership promotes safety, and the organizational and personal determination to transcend self-interest. Leadership styles are based on leaders’ traits. The trait-oriented theories of leadership function on the basis that leaders are born, not developed. Contratingly, focusing on leadership behaviors promotes the moulding of leaders through the development of certain behaviors and skills. Over the last few decades, leadership theory has shifted from a focus on specific traits to a focus on leadership behaviors. Two recent theories of leadership style are tranformational/ transactional leadership developed by J.M. Burns, and servant leadership. According to Early and Davenport (2010, p.59), “transformational leadership and transactional leadership are very different styles of leadership, but they are not mutually exclusive and can be complementary if employed correctly”. Additionally, an individual can have and develop skills required to be both a transactional and transformational leader. Transformational leaders stimulate interest among colleagues and followers to view their work from new perspectives; they generate awareness of the mission or vision of the team and organization; leaders guide followers to achieve their highest levels of potential; motivate colleagues to work for the larger interest of the group and the organization. This leadership style attempts to engage the follower’s creativity and loyalty, thus achieving a higher level of commitment and effort from employees. Tranformational behaviors include idealized influence, intellectual stimulation, individualized consideration, and inspirational motivation. Idealized influence is the leaders’ sharing of vision and sense of mission with employees, and the proposal of radical, innovative solutions to critical problems (Early & Davenport, 2010). The transformational leader has the respect and faith of the followers. Intellectual stimulation is the emphasis on intelligence and creativity by the leader. This includes the rethinking and reexamination of assumptions on which possibilities, capabilities, and strategies are based. Individualized consideration is the giving of personal attention and guidance on personal development to followers, making each feel valued and important. Inspirational motivation is the increase of optimism and enthusiasm of followers by leaders through effective communication. Transformational leadership “creates an environment in which every stakeholder is physically, spiritually, and emotionally invested in a shared vision” (Early & Davenport, 2010, p.59), fuelling a willingness towards sustained efforts for achieving organizational goals. Transactional leadership occurs when a leader “rewards or disciplines a follower depending on the adequacy of the follower’s performance” (Early & Davenport, 2010, p.59). Transational leadership emphasizes particular activities and interventions that help to achieve the vision or goal. This includes contingent reward in the form of compensation in exchange for successful work done by employees; active management by exception where the leader monitors performance and takes corrective action when mistakes or failures are detected. Passive management by exception is when the leader intervenes only if standards are not met or if something goes wrong. Transactional leadership is closely associated with traditional models and strategies employed in leadership theory. In this form, meeting the end goals is more important than the development, loyalty, and consideration of followers. Transactional and transformational leadership are not mutually exclusive constructs, and under specific circumstances a leader may be more transactional or more transformational; or the leader may combine both styles in order to achieve a desired outcome. Charismatic leadership is the ability to fuel group-focused motives and action among subordinates (Chemers, 1997). A charismatic leader usually has high levels of self-confidence, control and dominance over others, a strong conviction in the ethical righteousness of his or her beliefs, and a great need to influence others. Thus, the theory of charismatic leadership is typified by a certainty in self, and a willingness to impose that certainty on others. Among the leadership behaviors of charimatic individuals are role modeling with a public commitment to key values and beliefs, image building on the basis of one’s beliefs and principles, and goal articulation in relation to the call to a higher duty. The difference between tranformative and transactional leadership is that the goal is spiritual rather than pragmatic. Servant leadership is when a person who feels compelled to serve, naturally assumes leadership roles through his attitude of service. Servant leaders encourage trust, foresight, listening, and the ethical use of power. The other attributes of servant leadership include empathy, healing, awareness, persuasion, conceptualization, stewardship, commitment to people, and building community (Early & Davenport, 2010). Safety Leadership Promotes Employees’ Well-Being in the Work Place Safety Best Practices among highly effective safety leaders are valuable to leadership in general, but are derived with safety in mind since the welfare of employees is a prime concern of leaders. While management behaviors are directed on actions to be taken, on the other hand leadership behaviors focus on how the leader’s task fits the overall goals of the organization. Vision pertains to that of the effective leader, who perceives safety excellence accurately. He articulates the vision, and conveys it in a compelling manner throughout the organization. Examples are the communication of high personal standards of safety, promoting the questioning and rethinking of assumptions about safety, and describing a compelling vision of the future. Credibility of the effective leader is reinforced through his actions that underscore believability and trust among all other employees. Examples include a willingness to admit mistakes, proactive style of working for the interests of the group and giving full information about safety, even when it is not well received (Krause, 2007). Collaboration forms an important aspect of safety best practices. The effective leader works well as part of a team, promotes cooperation and collaboration in reducing exposures to hazards, actively seeks input from people on issues that affect them, and encourages others to implement processes for improving safety. The ability to communicate effectively is another important requirement for effective leadership. The successful leader encourages his followers or subordinates to give complete information about safety and other issues, even when the information is unfavorable. Leadership requires frequent communication across all levels of organizational structure. Action-orientation of the effective leader ensures timely, considered responses to safety and other concerns, expresses a sense of personal urgency and energy to achieve safety outcomes, and delivers results with speed and excellence. Positive feedback and recognition offered to employees for the accomplishments and contributions is another dimension of effective leadership style. This includes the use of praise more frequently than criticism, and finding ways to celebrate achievements in establishing safe practices. Effective leadership also emphasizes on accountability, and “fosters the sense that every person is responsible for the level of safety in his or her organizational unit” (Krause, 2007, p.19). However, accountability comes last, because in the absence of the other best practices in leadership style outlined above, accountability can turn into blame and damaging performance. Thus, the leadership style emphasizing safety integrates a commitment to safety with excellence in leadership. Social Exchange Theory Includes the Vertical Dyad Linkage Theory Social exchange theory emphasizes the exchange of benefits and favors between leader and follower, which leads to their mutual association with each other. Social exchange includes material as well as psychological benefits. A leader unable to take the initiative or to deal decisively with serious problems will lose esteem and influence, similar to a leader who proposes actions that are unsuccessful (Betts & Santoro, 2007). The exchange between leader and follower or vertical dyad linkage theory is based on the idea of social exchange, and proposes that the leader has different types of relations with employees. “Vertical dyad linkage not only involves downward relationships between leader and subordinate, but also includes upward relationships between that leader and his/ her boss” (Betts & Santoro, 2007, p.4). Results of studies suggest that leaders’ ability to establish favorable in-group relationships with subordinates was affected by their ability to form beneficial relationships with their leaders. Further, leaders with positive upward relationships with their bosses were found by the subordinates to be more technically competent, providing more valuable information, being more accommodating in participative decision-making, and providing more support and consideration to subordinates. Thus, “vertical dyad theory is most concerned with dyads between certain individuals within the organization’s structure”, state Betts and Santoro (2007, p.5). Leader-Follower Relations, Path-Goal, and Motivation Theories Followers have a critical role to play as a determinant of effective leadership. Leadership and followership occur simultaneously, and there can be no leadership without people following. Hence, the core element in leadership research have always been to make leaders effective in influencing and fuelling action among followers. Meindl (1995)’s follower-centred approach contrasts with the norm of leadership research’s focus on leader characteristics and behavior. The evidence indicates that followers play a critical role because leadership effectiveness depends on followers’ social construction of leadership. The focus on the role of followers for leadership effectiveness, aligns well with the social identity perspective on leadership effectiveness. Both factors emphasize the fact that the leader’s characteristics and behaviour as a group member form the basis of followers’ response to the leaders. Some leaders have more group prototypical characteristics than their own personal characteristics, due to which they represent the shared social identity and the common characteristics of the group. Such leaders differentiate the group from other people, and emphasize their identity as group members to a greater extent than other leaders. Thus, leaders who are group prototypical tend to be more influential and effective, and also aim for the best interests of the group (Meindl & Shamir, 2007). The path-goal theory of leadership that “integrates situational variables as moderators of the effects of leader behavior” (Chemers, 1997, p.45), makes the Robert House, 1971 model a true contingency theory of leadership. The characteristics of the followers and the followers’ tasks are also taken into account in this path-goal model. These situational variables decide when and how the leader’s behavior affects the motivation, performance, and satisfaction of the followers. The theory is based on the motivational function of the leader to increase followers’ perceptions of rewards for performance; and to make the path to these rewards easier for the follower to travel “by clarifying the appropriate behavior and criteria of performance and by removing roadblocks or barriers” (Chemers, 1997, p.46). According to Chemers (1997, p.125), “motivational factors are central to almost every theory of leadership”. In several models such as the path-goal theory, the leader’s main function is to influence subordinates through motivating them towards achieving organizational goals. The cultural differences in the nature of motivation have extensive implications for leadership. Leaders enhance followers’ motivation by recognizing their need and making it easier for them to meet their needs by creating motivational states aligned with task objectives, or by promoting new motives. In contemporary motivation theory of leadership, the predominant motives among followers include personal growth and individual achievement. On the other hand, a follower who is oriented to function interdependently may seek a close association with the leader, rather than aim for personal achievement or material gain. Empowering employees promotes motivation which in turn increases their engagement and commitment to their jobs, these factors raise their performance levels the company’s competitive advantage (Daft, 2007). Leadership and Emotional Intelligence Emotional intelligence is now increasingly being used as “a tool for identifying potentially effective leaders, and as a tool for developing effective leadership skills” (Palmer, Walls, Burgess et al, 2001, p.5). To determine the effectiveness of emotional intelligence in the above areas and to explore the relationship between emotional intelligence and effective leadership, the researchers conducted a survey on 43 participants employed in management positions. Emotional intelligence was measured by a modified version of the Trait Meta Mood Scale, a multi-factor leadership questionnaire; and effective leaders were identified as those who manifested a transformational rather than a transactional leadership style. It was found that emotional intelligence coincided with several components of transformational leadership, thus identifying emotional intelligence as an important component of effective leadership. Emotional intelligence particularly relates to how effective leaders interact with and monitor subordinates, and consequently how the followers feel at the workplace. Emotional intelligence is directly related to leadership attitude, which is the manifestation of a leader’s disposition, and contributes to his/ her character. A leader’s attitude may cause a limitation in leadership performance, or may form a catalyst fuelling the determination to overcome and succeed. For developing, strengthening and sustaining optimal leadership, the essential leadership qualities include toleration, tactful ingenuity, the determination to unite and the drive to encourage. The leadership position which may be acquired by choice, by appointment, by election or sometimes by default, is always one of responsibility. The leader is accountable for the outcome of his decisions and actions, and has to modify his attitude, according to the requirements of the situation (Reidenback, 2008). The Significance of Social Intelligence, and the Biology of Leadership Goleman & Boyatzis (2008) state that new studies of the brain reveal that by understanding the biology of empathy, leaders can effectively improve group performance. Social intelligence skills are crucial for achieving outstanding leadership, and gender differences influence to some extent the social intelligence skills in a leader. It is believed that on an average, women are better than men at immediately sensing other people’s emotions. At the same time, men are likely to have more social confidence, at least in work settings. However, the researchers found that gender differences in social intelligence that are normally very prominent in the general population, were almost completely absent among the most successful leaders. The behavioral assessment tool: the Emotional and Social Competency Inventory is used for measuring and improving social intelligence and administration skills. According to seven social intelligence qualities, the 360-degree evaluation instrument helps bosses, clients, peer, and sometimes even family members to assess a leader. Goleman and Boyatzis (2008) formulated seven social intelligence qualities using hard metrics to measure the behavior of top-performing leaders at hundreds of corporations over two decades. The leadership qualities that were assessed with the help of appropriate questions include empathy, attunement, organizational awareness, influence, developing others, inspiration and team work. The Cognitive Resource Theory in Effective Leadership Some of the conditions in which intelligence contributes to the performance of a group or organization are based on the cognitive resource theory, and the reasons why directive leaders who give instructions to their subordinates, as well as non-directive leaders who do not give directions are not always successful. A directive leader who does not understand the problem or has poor judgment may do a worse job than a non-directive leader who may be less bright but may be conducive to incorporating others’ ideas (Fiedler & Gibson, 2000). On the other hand, the reason why nondirective leaders who are intelligent perform poorly in some research studies is that group members interpret the failure to give directions as letting them down, and may not know how to react to a leader who is very bright but refrains from telling subordinates what to do. Though nondirective and participative leadership has several advantages, it is found from research that this leadership style is only effective when the leader is less bright, and has the support of his subordinates. According to Fiedler & Gibson (2000), further studies need to be conducted to determine whether these effects will be found in larger organizations. Figure 1. (Fiedler & Gibson, 2000, p.175) Cognitive resource theory attempts to identify the role of intelligence in determining leadership effectiveness and group performance. Figure 1 shows the group mean performance in standard scores, of two groups, one under a leader of high intelligence and the other under a leader of low intelligence, with high and low degrees of directiveness or group support. The graph shows the continuous and steep decline in the performance of the group with high leader intelligence, whereas the group with low leader intelligence shows a rise in performance, followed by a slow decline when the directiveness or the group support become low (Fiedler & Gibson, 2000). Effective Communication as Key to Successful Leadership Managers and those in positions of leadership require a combination of excellent spoken communication skills and awareness in order to be highly effective leaders. According to Aziz (2003, p.7) the three key elements to be addressed are “message, audience and medium, out of which audience is the most important”. To deliver the message appropriately, an accurate analysis of the audience is necessary. The audience may consist of a single colleague or a hall of conference delegates, and accurately analysing the audience helps the leader to make an impression and change the way people think, act and feel, which forms the foundation of a successful presentation or briefing to subordinates. With a clear idea of the concepts to be conveyed, the speaker needs to pitch the presentation according to the factors to be taken into account. An instant rapport is established with the audience if a common ground is achieved, by taking into consideration what the audience wishes to hear. Another key element is structure. The speech or instructions should have a clear beginning, middle and an end. It is important to first introduce the topic to the audience, discuss the points and then summarize the discussion. The medium or the environment in which the presentation is to be given also needs attention. Even when a particular presentation seems “small and informal and may involve just one other person, all the relevant points need to be implemented” (Aziz, 2003, p.7). Chemers (1997) presents an integrated model of leadership theories which maintains that the operational dimensions of leadership can be separated into three facets, which though interdependent to some extent, have different and distinctive features of leadership. Within each facet, contemporary theories reach comparatively consistent conclusions about the effective management of groups and organizations. The three facets include image management, relationship development, and resource utilization. Image management underscores that leaders should present themselves in ways that promote their authority; they must look and behave like effective leaders. Relationship development refers to the requirement for leaders to motivate and direct the activities of their subordinates in the organization. The resource utilization aspect reiterates that both team and organizational performance depend on the leader’s capability to effectively apply the resources of self and followers to accomplish the task. Conclusion This paper has highlighted theories of leadership, identified the determinants of effective leadership and discussed the various concepts and principles. The basic premises about leadership effectiveness were taken into consideration. The significance of leadership styles, and the different types including tranformational, transactional, charismatic, servant leadership, and safety leadership theories were examined. Further, the various determinants of effective leadership such as the critical role of followers, the importance of attitude, emotional intelligence, social intelligence and the biology of leadership, the cognitive resource theory in effective leadership, and effective communication as key to successful leadership were discussed. Additionally, social exchange theory, the vertical dyad linkage theory, leader-follower, path-goal, motivation and an integrated model of leadership theories, along with leadership strategy and the part played by organizational design have been acknowledged as significant facets of organizational leadership. Future research on effective leadership should focus on promoting intellectual abilities in organizational performance, developing improved tests to measure cognitive abilities, and providing conditions and methods for applying intellectual abilities. These are essential for ensuring best practices in the selection and appointment of executives in leadership positions. Thus, evidence-based interventions would lead to improved organizational leadership and consequent rise in organizational performance levels. ------------------------------------------- References Anderson, N., Ones, D. S., Sinangil, H. K. & Visweswaran, C. (2001). Handbook of industrial, work and organizational psychology. New York: Sage Publications. Aziz, K. (2003). Effective communication. Development and Learning in Organizations, 17(5): pp.7-9. Betts, S.C. & Santoro, M.D. (2007). Integrating leadership theories and team research: A conceptual framework based on level of analysis and type of control. Journal of Organizational Cutlture, Communication and Conflict, 11(1): pp.1-9. Chemers, M.M. (1997). An integrative theory of leadership. New Jersey: Lawrence Erlbaum Associates. Daft, R.L. (2007). The leadership experience. Edition 4. 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