CHAPTER 2
THE LEADERSHIP
EQUATION
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LEARNING OBJECTIVES
• Describe the variables that determine
leadership effectiveness
• Understand trait and behavior theories of
leadership
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THE LEADERSHIP EQUATION
Early studies of leadership were based on the
following theories:
• Trait theory: Focuses on qualities of the leader
• Behavior theory: Focuses on leadership
actions
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LEADERSHIP TRAIT THEORY, 1
Assumes that distinctive physical and psychological
characteristics account for leadership effectiveness
Important traits
• Basic intelligence
• Clear and strong values
• High level of personal energy
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LEADERSHIP TRAIT THEORY, 2
Ghiselli’s traits for effective leadership
• Need for achievement
• Intelligence
• Decisiveness
• Self-confidence
• Initiative
• Supervisory ability
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TRAIT THEORY APPLIED
Paul Von Hindenburg
• Second president of post-World War I Germany
• Used the trait theory for selecting and developing leaders
• Identified the primary qualities that determine
leadership ability
• Intelligence: Bright versus dull
• Vitality: Energetic versus lazy
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FIGURE 2.1: DIMENSIONS OF LEADERSHIP
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LEADERSHIP BEHAVIOR THEORY
In the 1930s, emphasis on behaviorism in psychology moved researchers
in the direction of the study of leadership behavior versus leadership
traits
Kurt Lewin trained assistants in behaviors indicative of three
leadership styles
• Autocratic: Characterized by tight control of group
activities and decisions made by the leader
• Democratic: Emphasized group participation and majority
rule
• Laissez-faire: Involved low levels of any kind of activity by
the leader
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OHIO STATE UNIVERSITY STUDIES ON LEADERSHIP
Ralph Stogdill and others developed the Leader Behavior
Description Questionnaire or L B D Q
• Respondents to the questionnaire described leaders’
behaviors in two dimensions
• Initiating structure: Extent to which leaders take action to
define the relationship between themselves and their staff
• Consideration: Extent to which leaders take action to
develop trust, respect, support, and friendship with
subordinates
UNIVERSITY OF MICHIGAN STUDIES ON LEADERSHIP
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Studies conducted under the direction of Rensis
Likert
Impact of leaders’ behaviors related to worker motivation
and group performance were studied
Dimensions of leadership behavior that were identified
• Job-centered: Same as initiating structure
• Employee-centered: Same as showing consideration
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ROBERT BLAKE AND JANE MOUTON’S
MANAGERIAL GRID, 1
• Reflects the Ohio and Michigan dimensions of initiating structure
and showing consideration
• Identifies the ideal leader as having a high
concern for both production and people
ROBERT BLAKE AND JANE MOUTON’S
MANAGERIAL GRID, 2
Major styles in managers
Impoverished: Low concern for production and people
Sweatshop: High concern for production but low concern for
people
Country club: High concern for people and low concern for task
accomplishment
Status quo: Medium concern for both production and people
Fully functioning: High concern for both production and
people
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THE MANAGERIAL GRID
ROBERT BLAKE AND JANE MOUTON’S
MANAGERIAL GRID, 3
Additional styles
Paternalistic
High concern for production combined with use of
rewards in exchange for compliance and loyalty
Opportunistic
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Promotion of manager’s own advancement
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BEHAVIOR THEORY APPLIED
Margot Morrell documented Ernest Shackleton’s
Endurance expedition and identified behaviors of
successful leaders:
Leading by example
Communicating a vision
Keeping up morale
Maintaining a positive attitude
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LEADERSHIP CONTINGENCY THEORY, 1
Holds that the most appropriate leadership
qualities and actions vary from situation to
situation
States that leadership effectiveness depends on:
• Leader
• Follower
• Situational factors
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LEADERSHIP CONTINGENCY THEORY, 2
Leaders in different situations need different
interests, values, and skills
• Leaders in a bank differ from the ones on a farm
• Experienced versus new followers have different
needs
• Situational factors include the job being
performed, the culture of the workplace, and the
urgency of the task
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LEADERSHIP CONTINGENCY THEORY, 3
Leadership results when the ideas and deeds of
the leader match the needs and expectations of
the follower(s) in a particular situation
• Examples include:
• General George Patton,
• Nelson Mandela, and
• Adolf Hitler
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TRANSFORMATIONAL LEADERSHIP, 1
Charisma: Extraordinary ability to inspire others and
bring forth loyalty
Max Weber’s definition of Charisma
• Certain quality that causes one to be set apart
from ordinary people and to be treated as
endowed with exceptional powers or qualities
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TRANSFORMATIONAL LEADERSHIP, 2
Charisma is a gift or power of leadership
Charismatic leaders exhibit a combination of
personal characteristics and types of behavior
• Dominant
• Ambitious
• Self-confident
• Strong sense of purpose
TRANSFORMATIONAL LEADERSHIP, 3
Charismatic leaders demonstrate specific types of
behaviors
• Role models for the beliefs and values they want their
followers to adopt
• Demonstrate ability that elicits the respect of followers
• Have ideological goals with moral overtones
• Communicate high expectations and show confidence
in their ability to meet those expectations
• Ignite the motives of followers to take action
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TRANSFORMATIONAL LEADERSHIP, 4
Football coach Vince Lombardi generated respect
and following of others through charisma by:
• Caring
• Working hard
• Knowing the right answers
• Believing
• Keeping the bar high
• Knowing people
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TRANSFORMATIONAL LEADERSHIP, 5
Use of optimism, charm, intelligence, and other
personal qualities to raise aspirations and
transform individuals and organizations into new
levels of high performance
First discussed by J. V. Downton
James MacGregor Burns distinguished two kinds
of leadership
• Transformational leadership
• Transactional leadership
TRANSFORMATIONAL VERSUS TRANSACTIONAL, 1
Transformational leaders
• Focus on the potential relationship between the
leader and the followers
• Engage the full person of the follower
• Tap the motives of the followers
Transactional leaders
• Focus on exchanges between leaders and followers
• Emphasize exchanging one thing for another
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TRANSFORMATIONAL VERSUS TRANSACTIONAL, 2
Research shows that transformational
leadership has a positive effect on
performance
• Transformational leadership can occur at all
levels of an organization
• Transformational leaders can emerge in both
formal and informal roles

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