There is no question that effective leadership gives many people power to handle any situation tactfully and can have a truly significant impact on organizational performance, both in the immediate and longer term. However, what leaders can and ought to do in order to spark the best performance from there people is old-age mystery.
New search conducted by the consulting firm Hay / McBer, found six distinct leadership roles, each springing from different components of EQ (emotional quotient):
Only four of the six consistently have a positive effect on climate and result as Daniel Goleman stated, “Leaders who have mastered four or more – especially the authoritative, democratic, affiliative and coaching styles – have the best climate and business performance.” (Bantam, 1995)
(Source: Harvard Business Review, 2000)
Studying new types of leadership styles in the 1980s and 1990s opened opportunities for further investigations of the leadership styles i.e. transformational, transactional. Thus, this article analyzes different leadership styles with the purpose of proving that the most effective business leaders use a collection of diverse leadership styles.
Transformational leadership is the dominant leadership theory today (Julian Barling, 2001), transformational approach initially emerged in Burns’s (1978) delineation of a type of leadership, subsequently elaborated by Bass (1985, 1998); transformational leadership involves establishing oneself as a role model by gaining the trust and confidence of followers.
The vision, drive, passion and ability of leaders to inspire their followers into action largely make up their charismatic leadership style.
Jack Cohen, CEO at TESCO, one of the world’s leading retail outlets on three continents is a good example of transformational leader, emerging four key factors of transformational approach:
Such leaders state future goals and develop plans to achieve them. By mentoring and empowering their followers, transformational leaders encourage them to develop their full potential and thereby to contribute more capably to their organization. Researchers labeled this future oriented, empowering style as charismatic leadership. The vision, drive, passion and ability of leaders to inspire their followers into action largely make up their charismatic leadership style (Conger et al., 1998).
However, it is very factor at the core of transformational leadership, that some scholars believe contributes to its potential to be unethical.
Giampetro et al. (1998) suggests that transformational leaders are most successful in inspiring their followers when their vision is tremendously strong and when they demonstrate absolutist behavior. They contend that leadership of this kind, although effective, lacks reflection and consideration and consequently is unlikely to produce ethical behavior within organizations. In addition, transformational leaders may be overly narcissistic and self-centered, which may in turn allow them to direct followers toward questionable goals.
Although Giampetro et al.’s (1998) comments appear to be concerned with transformational leadership in general; they are more closely focused on aspects related solely to the charismatic component of transformational leadership. It can be seen, the transformational principles like inspirational motivation deployed by TESCO has demonstrably contributed towards the organization’s long-term success.
For instance, with net profits of around £3.4 billion, Tesco has become the largest British retailer and Tesco’s growth has resulted in a worldwide workforce of over 468,000 employees.
However, Bass (1985) argues that some influential charismatic leaders, possessing all of these qualities, have proven themselves to be more dictators than leaders, including examples such as Adolph Hitler and Benito Mussolini. Thus, charisma has often been couched in terms of ‘positive’ and ‘negative’ side of leadership with the inclusion of qualities such as narcissism, manipulation, alienation of people and defensiveness. Kelly (1987) goes further in suggesting that a charismatic leader’s self-interest may undermine and even erode the ethical base of their organization. Such a perspective is not new, as there already exist a substantial component of the literature that considers the ‘dark side’ of charisma.
However, although transformational leadership is of primary concern these days, it is only one of two halves in a full range of leadership, the other half being transactional leadership.
Transactional leadership includes four components: contingent reward, management by-exception-active, and management-by-exception-passive and laissez-faire leadership. However, there is a stark variation across these four transactional behaviors in their relationships to effective leadership and it may be more useful to reframe these leadership styles into two meaningful categories adapted from Avolio et al. (1999). These two categorizations are developmental exchange, which includes contingent reward and individualized consideration, and corrective avoidant leadership, which includes both managements-by-exception and laissez-faire leadership.
Avolio et al. (1999) argued that contingent reward (transactional leadership) and individualized consideration (transformational leadership) are conceptually similar, showed that they correlate together strongly, and demonstrated that they had the highest level of fit as a higher-order leadership factor. They argued the same about the relationship between the management-by-exception and laissez-faire factors. They also found confirmed transformational leadership and developmental exchange correlate positively.
According to Business Ethics (2001), a less successful active transactional leadership behavior is management-by exception active. Although an active manifestation of leadership, management-by exception -active involves keeping track of mistakes and looking for irregularities in work. This did Jane Johnson who assumes the CEO position of Solar Drinks in 2000 exhibit. Because this leadership is based on reprimanding followers for mistakes, it may reduce the positive impact of active leading.
Alternately, Lowe et al. (1996) argues management-by-exception (passive) and laissez-faire, the two passive avoidant leadership styles, are expected to correlate negatively with perceived integrity. These factors are measured by items including “waits for things to go wrong before taking action”, “avoids making decisions”, and “is absent when needed”. The retrospectively and inactivity of such behaviors are likely to be negatively related to perceptions of integrity.
As far as people’s desires are concerned in the GLOBE leadership study, people want their leaders to be trustworthy, just, honest, decisive, and so forth. (House et al., 2004) for an example of fluid leadership in action, consider Joan, the general manager of a major division at a global food and beverage company. Joan was appointed to her job while the division was in deep crises that it had missed by $50 million. Here, Joan switched different leadership approach as a whole; she followed the on-on-one conversation, explored dreams, lives and aspirations of team members, which are dimensions of (Bass, 1985; Den Hartog et al., 1997) transformational leadership incorporating transactional approach. After only seven months, Joan’s division exceeded its yearly profit target by $5 million. (Harvard Business Review, 2000)
In emphasizing leader roles, social role theorists Biddle (1979), Sarbin et al., (1968) argue that leaders occupy roles defined by their specific position in a hierarchy and simultaneously function under the constraints of their leadership roles.
As Tom, vice president of marketing at a floundering national restaurant chain that specialized in Pizza, did to uphold the company’s poor performance by implementing authoritative style. He made company’s managers understood they were the key to company’s success and were free to find new ways to distribute pizza. In terms of the general definition of social roles as socially shared expectations that apply to persons who occupy a certain social position or are members of a particular social category (Biddle, 1979; Sarbin et al., 1968) In other words, to be seen as effective, the time-tested adage continues to apply “When in Rome do as the Romans do.” Tom was successful to make changes quickly and managers to act like entrepreneurs.
To conclude, like parenthood, leadership will never be an exact science. However, neither should be a complete mystery to who practice it. Leaders should expand their own style repertories. To do so, leaders must first understand which EQ competencies underlie the leadership styles they are lacking. (Daniel at el, 2004) They can then work assiduously to increase their quotient for them.
Mowday, et al. (1982) states an affiliative leader has strength in three emotional intelligence competencies:
Empathy allows the affiliative leader to respond to employees in a way that is highly congruent with that person’s emotions. The affiliative leader also displays a natural ease in forming new relationships, getting to know someone as a person and cultivating a bond. Finally, the outstanding affiliative leader has mastered the art of interpersonal communication, particularly in saying just the right thing or making the apt symbolic gesture at just the right moment.
As another example, an authoritative leader who wants to add the democratic style to his repertory might need to work on the capabilities of collaboration and communication.
The business environment is continually changing and a leader must respond in kind. Executive must play their transformational and transactional leadership styles like a pro – using the right one at just the right one and in the right time and in the right measure.
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