Leading & TrustMatthew L. Eisenhard, Psy.D.Week 7: Psychology for Business & Industry

Leadership LEADERSHIP

The process of influencing employees to work toward the achievement of objectives.

Leadership Quotes…◦ John F. Kennedy

“Leadership and learning are indispensible to each other.”◦ Colin Powell

“Leadership is solving problems.”◦ Dwight D. Eisenhower

“Leadership is the art of getting someone else to do something you want done because he wants to do it.”

◦ Harry S. Truman “Men make history , and not the other way around. In periods where there

is no leadership, society stands still. Progress occurs when courageous , skillful leaders seize the opportunity to change things for the better.”

◦ Peter Drucker “Management is doing things right; leadership is doing the right things.”

Leadership

• Strong leadership skills are needed in today’s teamwork oriented business model.▫ There are various different styles of leadership.▫ Leadership can make a difference in performance

– for individuals and organizations.▫ http://www.youtube.com/watch?v=FmpIMt95ndU

Leadership & Management• These two elements are often used synonymously…• They are related but different…• Management has five functions:

▫ PLANNING▫ ORGANIZING▫ STAFFING▫ LEADING▫ CONTROLLING

• Leadership is a function of management.▫ You can be a good manager without being a good leader and vice versa.▫ Good leadership is often a shared activity in an organization.

• What does it take to be a good leader & what is the best leadership style?

▫ No universal agreement.▫ So let’s look at some of the theories…..

Leadership Trait Theories

• Assume there are distinctive physical and psychological characteristics that account for effective leadership.▫ Yes…personality traits do effect leadership style.▫ But after 70 years of research

we still cannot identify a specific list of traits that all successful leaders have in common.

Leadership Trait Theories• Ghiselli Study – most publicized trait theory.

▫ Listed 6 Traits SUPERVISORY ABILITY

Getting the job done through others. NEED FOR ACHIEVEMENT

Seeking responsibility. INTELLIGENCE

Good judgment – reasoning – thinking.

DECISIVENESS Solving problems and making decisions.

SELF-ASSURANCE Seeing yourself as capable.

INITIATIVE Self-starter – no need for supervision.

Leadership Trait Theories• Current Studies

▫ Wall Street Journal/Gallup – Found 3 Traits. INTEGRITY INDUSTRIOUSNESS GETTING ALONG WITH OTHERS

Self-Assessment Exercise 7-1Total Score for each column.

5 -25Overall.◦ 15-75

In general – higher scores mean better chances for success.

Behavioral Leadership TheoriesAssume that there are distinctive styles

that effective leaders use consistently, that is, that good leadership is rooted in behavior.◦ Two-Dimensional Leadership Styles◦ The Leadership Grid◦ Transformational, Charismatic,

Transactional, and Servant Leadership and Stewardship

Two-Dimensional Leadership Styles1945 – Ohio State University Study to determine

effective leadership styles - their findings…Initiating Structure/Job-Centered

How much does the leader take charge?Consideration/Employee Centered

How much does the leader interact with employees?Combinations: (Exhibit 7.1)

1 = High Structure/Low Consideration 2 = High Structure/ High Consideration 3 = High Consideration/ Low Structure 4 = Low Consideration/ Low Structure

Leadership Grid Blake & Moulton’s Model (1964-1991) Ideal leadership style has high concern for both the

job and the people. They Identify 5 Major Styles:◦ IMPOVERISHED MANAGER (1.1)

Low concern for both job & people. Does minimum work to keep his/her job.

◦ SWEATSHOP MANAGER (9.1) High concern for job – low for people. Uses power to coerce people & treats them like machines.

◦ COUNTRY CLUB MANAGER (1.9) High concern for people – low for job. It’s all about be friendly and having good relationships.

◦ ORGANIZED-PERSON MANAGER (5.5) Medium concern for both job and people. Runs middle of the road to keep both going well.

◦ TEAM MANAGER (9.9) High concern for both people and job. Participation, commitment and resolving conflict are tops.

Transformational, Charismatic, Transactional, & Servant Leadership & StewardshipTRANSFORMATIONAL◦ About change, innovation, and entrepreneurship.◦ Steve Jobs, Apple.

CHARISMATIC◦ Have extraordinary influence, gifted, heroic.◦ Martin Luther King Jr., Mother Theresa.

TRANSACTIONAL◦ Based on “quid pro quo” – you do something for me, and I’ll

do something for you.◦ Good negotiators.

SERVANTS & STEWARDSHIP◦ Primary motives are devotion to the best interests of the

organization as opposed to self-serving, opportunism.◦ Self-sacrificing.

Contingency Leadership Theories• Assume the appropriate style of leadership

varies depending on the situation.• Attempt to create win-win situations by giving

support and direction.• Contingency Theories:

▫ Contingency Leadership Theory▫ Leadership Continuum▫ Normative Leadership Theory▫ Situational Leadership

Contingency Leadership Theory Fiedler (1951) – determines if style is task or relationship oriented & if it matches the

leaders style. If there is no match – then leader should change the situation rather than

leadership style. High LPC Leaders = more relationship-oriented.

Do well in moderately favorable circumstances. Low LPC Leaders = more task-oriented.

Do well in highly favorable or highly unfavorable circumstances. Situational Favorableness

Leader-member relations – good or poor? Better relations = more favorable situations.

Task Structure? More structure = more favorable situation.

Position Power – strong or weak? More power = more favorable situation.

Determining Appropriate Leadership Style Refer to Exhibit 7.3. Uses three questions about situational favorableness. Follows a Decision Tree for determining Appropriate Style.

Leadership ContinuumTannenbaum & Schmidt – Identifies seven leadership

styles based on the use of boss-centered versus employee-centered leadership.

Before selecting one of the 7 leadership styles – three factors need to be considered: The Manager = Preferred Style based on experience and

confidence in employees/subordinates. The Subordinates = Preferred Style for the leader –

generally the more willing able they are the more freedom they should be given.

The Situation = What is the organizations structure, size, goals, technology – and what are upper-level managers leadership styles?

Normative Leadership TheoryVroom & Yetton (2000) – Decision tree method to

choose from 5 leadership styles depending which is best for the situation (adapted from previous models).

Five Leadership Styles:◦ Decide – Leader decides.◦ Consult Individually – Leader talks to employees separately

to get input – but still makes the decision.◦ Consult Group – Talks to group of employees for input –

but still makes the decision.◦ Facilitate – Group meeting/employees share in decision.◦ Delegate – Group makes the decision.

Situational Leadership• Hersey and Blanchard• A model to select from 4

leadership styles that match the maturity level of the employee in any given situation.▫ Refer back to Exhibit 7.1

Lower right quadrant (1) = Telling

Upper right quadrant (2) = Selling

Upper left quadrant (3) = Participating

Lower left quadrant (4) = Delegating

Your Preferred Leadership Style

• Self-assessment exercise 7.2.▫ The more evenly distributed the numbers are –

the more flexible your style. A 1 or 0 in a column indicates a reluctance to use

that style.▫ There is no “right” leadership

style. This will just help you understand

the way you prefer to use.

https://www.youtube.com/watch?v=83yInyY1KLs

Situational SupervisionNo one leadership style is best.Supervisory/employee interactions

have two categories:◦ DIRECTIVE BEHAVIOR

Focus on getting the job done.◦ SUPPORTIVE BEHAVIOR

Focus on encouraging and motivating employees.The situation is determined by the capability of the employee.◦ ABILITY

What level of education, experience, skills do they have?◦ MOTIVATION

How much do they want to do the job – will they need support & encouragement - or will they do it on their own?

Levels of Employee CapabilityLOW (C-1)◦ Need lots of direction and supervision – lack

motivation.MODERATE (C-2)◦ Need some supervision – may have high motivation

but still need directions, support and encouragement.HIGH (C-S)◦ High in ability – but lack confidence – needs lots of

support and encouragement to get motivated.OUTSTANDING (C-4)◦ Got all the knowledge and are highly motivated on

their own.

The Supervisory Styles (Reviewed)AUTOCRATIC (S-A)◦ Gives direct instructions, close supervision, and does

not consult employee about decisions.CONSULTATIVE (S-C)◦ give directions, but may include employee in decisions

– boss still has final word.PARTICIPATIVE (S-P)◦ Gives generalized directions but does not closely

supervise – gives support and encouragement and allows input from employee – boss still has final say.

LAISSEZ-FAIRE (S-L)◦ Spends little or no time supervising or directing –

here’s the job – do it.

Substitutes for Leadership

• Leadership is a shared process in groups.▫ There is no substitute for leadership in that case.▫ But there are substitutes for managers.

• The following can provide direction and support:▫ Characteristics of subordinates▫ Characteristics of task▫ Characteristics of the

organization

Diversity & Global Leadership• We are growing more GLOBAL every day.• Most leadership theories originate in U.S.

▫ Our cultural beliefs and values may not be as effective in other countries.

• Cultural sensitivity is vital to operations outside one’s own country.

• E-organizations operate a little differently.▫ Leaders focus on speed – flexibility – vision.▫ More written and less face-to-face

communication.▫ The Virtual Team uses technology to

communicate.

Differences in Styles

Leadership styles are not a “one-size-fits-all,” situations also vary according to cultures.

Korean leaders◦ Expected to act as father figures to employees.

Arab leaders◦ Viewed as weak if they show kindness or generosity.

Japanese leaders◦ Expected to be humble and not speak much .

Scandanavian & Dutch leaders◦ Embarrass employees publicly rather than motivate

with individual praise.

Trust• In business and life in

general, trust is an absolute essential.▫ It is the positive

expectation that another will not take advantage of you

• It should not be “given” but “earned.”

• It takes time to develop true trust.

• Self-assessment exercise 7.3.

Types or Levels of Trust• DETERRENCE-BASED

▫ Based on fear.▫ It is the most fragile since one violation or inconsistency can destroy the

relationship.• KNOWLEDGE-BASED

▫ Most common in organizations.▫ Knowledge lets us predict behavior.▫ The better we know someone the more we can predict their actions.▫ It is not destroyed by a singular inconsistency - it allows for forgiveness and

moving forward.▫ Everyone makes mistakes and forgiveness is vital to good relationships.

• IDENTIFICATION-BASED▫ Emotional connections – friendships.▫ The highest level of trust.▫ Gender differences – men state their expectations – women trust others will

anticipate them.

Developing Trust

• Integrity• Competence• Consistency• Loyalty• Openness• Risk and Destroying

Trust

Integrity• Tell The Truth

▫ The fine line between truth and lying is called tactfulness.

• Keep Your Commitments▫ Promises made are promises kept.

• Be Fair▫ Fairness establishes credibility.▫ Integrity and fairness are core to good business and

relationships.

Competence• Be Conscientious

▫ Do you trust someone who does shoddy work?

• Know Your Strengths And Limitations▫ Don’t commit to doing something that you won’t

be able to deliver.• Admit Your Mistakes

▫ If you are a “know it all” … people tend not to trust you…we don’t trust or even like people that have to be right all the time.

Consistency

• Keep Commitments▫ This is a repeat – because it

is very important! Do what you say you will do.

• Practice What You Preach▫ If you “talk the talk” … then you must “walk the

walk.” The old saying “do as I say, not as I do” will not fly.

LoyaltyInvest Heavily

In Loyalty◦ If you display loyalty it will usually be reciprocated –

no one trusts someone who is only taking care of numero uno.

Maintain Confidences◦ Don’t repeat things told to you in confidence – no one

trusts a back-stabber or someone who blabs everything they know.

Don’t Gossip Negatively About People◦ If you talk about others in a negative way…people

assume you will be doing the same about them as soon as their backs are turned.

Openness• The Johari Window

▫ Refer to Exhibit 7.8.▫ Based on self understanding we chose what is

appropriate to share with others.▫ Disclosure is a gradual and mutual process based

on trust.• Risk Self-Disclosure

▫ Everyone is vulnerable in some way.▫ But the rewards of letting yourself be known to

others are worth the risk.

Repairing TrustTrust is earned and builds over time.Easier to destroy than to build .Once trust is broken relationships may be mended

but they are never the same again.Admit mistakes and apologize.Women generally more willing to

apologize than men.We find it easier to apologize to

strangers than loved ones.People get very emotional when

they feel their trust has been betrayed – stay calm.

Key Points

• Explaining Leadership and it’s effects• Leadership Trait theory• Behavioral Leadership Theories• Contingency Leadership Theories• Situational Supervisory Styles• Three Substitutes for Leadership• Diversity and Global Leadership• Five dimensions of Trust