CHAPTER- 5

LEADERSHIP AND
MOTIVATION

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OBJECTIVES
After studying this chapter, you should be able to:

1. What is leadership?
2. Contrast leadership and management.
3. Basic Principles of Leadership
4. Traditional Theories of Leadership
LEARNING

5. Contingency Theories of Leadership

6. Contemporary Approaches to Leadership
7. What is Motivation?
8. Early Theories of Motivation
9. Contemporary Theories of Motivation
10. Guidelines for Motivating Employees
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 What Is Leadership?

Leadership
The ability to influence a
group toward the
achievement of goals.

Management
Use of authority inherent
in designated formal rank
to obtain compliance from
organizational members.

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 Leadership vs. Management

Leadership Management
 About coping with change  About coping with
complexity
 Establish direction with a  Brings about order and
vision. consistency
 Align resources and  Draws up plans,
inspire workers to structures, and monitors
complete the vision. results.

Leadership is the ability to influence a group toward the

achievement of a vision or a set of goals.

11-4
 Leaders and Leadership
 Leader – Someone who can influence others and who
has managerial authority
 Leadership – What leaders do; the process of
influencing a group to achieve goals
 Ideally, all managers should be leaders
 Definition of Leadership
 Leadership is the process [social influence] of inspiring,
influencing, and guiding others to participate in a
common effort.
 Leadership is the process of motivating, influencing, and
directing others in the organization to work productively
in pursuit of organization goals.

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 Cont’d

 Power is the capacity to affect/influence the behavior of

others. Bases of power for a person exerting influence:
1. Legitimate power stems from a position’s placement in the
managerial hierarchy and the authority vested in the position.
2. Reward power is based on the capacity to control and
provide valued rewards to others.
3. Coercive power is based on the ability to obtain compliance
through fear of punishment.
4. Expert power is based on the possession of expertise that is
valued by others.
5. Referent power results from being admired, personally
identified with, or liked by others.

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 Basics of Leadership
 Give people a reason to come to work.
 Be loyal to the organization’s people
 Spend time with people who do the real work
of the organization.
 Be more open and more candid about what
business practices are acceptable and proper
and how the unacceptable ones should be
fixed.

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Basic Principles of Leadership
Technical proficiency
Developing sense of responsibility
Ensure task understanding, supervision &accomplishment
Keeping workers informed
Keeping for wellbeing of people
Making timely and sound decision
Taking responsibility for action
Setting examples
Broader in scope
Leadership research has tried to answer: What is an
effective leader?
 Traditional Theories of Leadership
Traits Theories of
Leadership(1920s-30s)
Leadership Traits:
Theories that consider personality,
• Ambition and energy
social, physical, or intellectual traits
to differentiate leaders from non • The desire to lead
leaders. • Honest and integrity
Differentiate leaders from non- • Self-confidence
leaders by focusing on personal
qualities and characteristics • Intelligence

Limitation: • High self-monitoring

• Job-relevant
No universal traits found that
knowledge
predict leadership in all situations.
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Seven Traits Associated with Leadership

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 Early Leadership Theories (cont’d)
Behavioral Theories of Leadership
Theories proposing that specific behaviors differentiate
leaders from non-leaders.
Behaviors can be taught – traits cannot
Leaders are trained – not born

• Trait theory:
Leaders are born, not made.
• Behavioral theory:
Leadership traits can be taught.

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Behavioral Theories of Leadership (cont’d)

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Behavioral Theories of Leadership (cont’d)

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 University of Iowa Studies (Kurt Lewin)
 Identified three leadership styles:
– Autocratic style: centralized authority, low
participation
– Democratic style: involvement, high
participation, feedback
– Laissez faire style: hands-off management
• Research findings: mixed results
– No specific style was consistently better for
producing better performance
– Employees were more satisfied under a
democratic leader than an autocratic leader.
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 Ohio State Studies

Developed two categories of

leadership behavior:

 The extent to which a leader is  The extent to which a leader is

likely to define and structure likely to have job relationships
his or her role and those of characterized by mutual trust,
sub-ordinates in the search for respect for subordinate’s ideas,
goal attainment. and regard for their feelings.
 Attempts to organize work,  Concern for followers’ comfort,
work relationships, and goals well-being, status, and
11-15 satisfaction
 University of Michigan Studies

Developed two dimensions of

leadership behavior:

 Emphasizing interpersonal
 Emphasize the technical or relations; taking a personal
task aspects of the job: people interest in the needs of
are means to an end employees and accepting
 One who emphasizes technical individual differences among
or task aspects of the job. members.

11-16
 Blake and Mouton’s Managerial Grid®
Combination of Ohio State and University of
Michigan studies:

Appraises leadership styles using two dimensions: Try to emphasize

BOTH
Places managerial styles in five categories:
Impoverished management
Task management
Middle-of-the-road management
Country club management
Team management
11-17
The
Managerial
Grid

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 Contingency Theories of Leadership
 Attempts to match leadership style with work
conditions:
 The Fiedler Model
– Proposes that effective group performance depends upon
the proper match between the leader’s style of interacting
with followers and the degree to which the situation allows
the leader to control and influence.
– Assumptions:
 A certain leadership style should be most effective in
different types of situations.
 Leaders do not readily change leadership styles.
– Matching the leader to the situation or changing the
situation to make it favorable to the leader is required.17–19
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 Contingency Theories… (cont’d)
 The Fiedler Model (cont’d)
– Least-preferred co-worker (LPC) questionnaire
– An instrument that purports to measure whether a person
is task- or relationship-oriented.
– Determines leadership style by measuring responses to
18 pairs of contrasting adjectives.
– High score: a relationship-oriented leadership style
– Low score: a task-oriented leadership style
– Situational factors in matching leader to the situation:
• Leader-member relations
• Task structure
• Position power
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 Fiedler’s Model: Defining the Situation

Leader-Member Relations
The degree of confidence, trust, and respect
subordinates have in their leader.

Task Structure
The degree to which the job assignments are
procedurized.

Position Power
Influence derived from one’s formal structural
position in the organization; includes power to hire,
fire, discipline, promote, and give salary increases.
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Findings of the Fiedler Model

Either change leaders or the situation to improve effectiveness

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 Hersey and Blanchard’s Situational Leadership
Theory

 Situational Leadership Theory (SLT)

A contingency theory that focuses on followers’
readiness.
Unable and Unable but Able and Able and
Unwilling Willing Unwilling Willing

Follower readiness:
ability and willingness

Leader: decreasing need

for support and supervision

Directive High Task and Relationship Supportive Monitoring

Orientations Participative

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 Contingency Theories… (cont’d)
 Hersey and Blanchard’s Situational Leadership Theory
(SLT)
– Argues that successful leadership is achieved by
selecting the right leadership style which is contingent
on the level of the followers’ readiness.
• Acceptance: leadership effectiveness depends on
whether followers accept or reject a leader.
• Readiness: the extent to which followers have the
ability and willingness to accomplish a specific task.
– Leaders must relinquish control over and contact with
followers as they become more competent.

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 Leadership Styles and Follower Readiness
(Hersey and Blanchard)

Follower Unwilling Willing

Readiness

Able Supportive
Monitoring
Participative

Leadership
Styles
High Task
Unable Directive and
Relationship
Orientations

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 Contingency Theories… (cont’d)

 Path-Goal Theory
The theory that it is the leader’s
job to assist followers in
attaining their goals and to
provide them the necessary
direction and/or support to
ensure that their goals are
compatible with the overall
objectives of the group or
organization.

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 Contingency Theories… (cont’d)
 Path-Goal Model
– States that the leader’s job is to assist his or her
followers in attaining their goals and to provide direction
or support to ensure their goals are compatible with
organizational goals.
– Leaders assume different leadership styles at different
times depending on the situation:
• Directive leader
• Supportive leader
• Participative leader
• Achievement oriented leader
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 The Path-Goal Theory

E X H I B I T 11–4

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Contemporary Approaches to Leadership
 Leaders as communicators
 Framing/Enclosing the meaning of events
 Leaders inspire followers through words, ideas,
and behaviors:
– Charismatic Leadership
– Transformational Leadership
– Authentic Leadership

11-29
 Charismatic Leadership
 An enthusiastic, self-confident leader
whose personality and actions
influence people to behave in certain
ways.
Characteristics of charismatic leaders:
1. Have a vision.
2. Are able to articulate the vision.
3. Are willing to take risks to achieve the
vision.
4. Are sensitive to the environment and
follower needs.
5. Exhibit behaviors that are out of the
ordinary.
11-30
 Cont’d

 How Charismatic Leaders Influence Followers

 Articulate an appealing vision
 Communicates a new set of values
 Model behaviors for those values
 The Potential Dark Side of Charismatic
Leadership
 Use organizational resources for personal benefit
 Remake companies in their own image
 Allow self-interest and personal goals to override
organization’s goals
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 Transformational Leadership
 Transactional leaders - motivate their followers in the
direction of established goals by clarifying role and task
requirements
 Transformational leaders - inspire followers to transcend
their own self-interests for the good of the
organization .Leaders who also are capable of having a
profound and extraordinary effect on their followers.
 Why Transformational Leadership Works
1. Creativity --Followers are encouraged to be more innovative
and creative
2. Goals--Followers pursue more ambitious goals and have
more personal commitment to them
3. Vision --Engenders commitment from followers and greater
sense of trust
11-32
 Authentic Leadership: Ethics as the Basis for
Leadership?

 Authentic leaders know who they are, what they believe

in and value, and act on those values and beliefs openly
and candidly

– Credibility
– Create trust
– Encourage open
communication
– Socialized Charismatic
Leadership

11-33
 Developing Credibility and Trust
 Credibility/Reliability (of a Leader)
– The assessment of a leader’s honesty, competence,
and ability to inspire by his or her followers
 Trust
– Is the belief of followers and others in the integrity,
character, and ability of a leader.
• Dimensions of trust: integrity, competence,
consistency, loyalty, and openness.
Is related to increases in job performance,
organizational citizenship behaviors, job
satisfaction, and organization commitment.

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Suggestions for Building Trust

Practice openness.
Be fair.
Speak your feelings.
Tell the truth.
Show consistency.
Fulfill your promises.
Maintain confidences.
Demonstrate competence.
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Finding and Creating Effective Leaders
 Selection:
– Personality tests for leadership traits
– Interviews to match relevant situation-specific
experience to job situation
 Training:
– Train those willing to change their behavior
– Teach general management skills
– Teach charismatic and transformational leadership
skills – greatest organizational outcomes result
11-36
 THE NATURE OF MOTIVATION
 Being able to effectively motivate employees is a challenge that
managers face in all types and sizes of organizations.
“Everything that we give to our workers gets returned to us in
terms of efficiency, quality, loyalty, and innovation.”
 Motivation is a process that starts with a physiological or
psychological need that activates a behavior or a drive that is
aimed at a goal.
 Every employee is expected to show increased and qualitative
productivity by the manager. To achieve this the behavior of the
employee is very important. The behavior of the employees is
influenced by the environment in which they find themselves.
An employee's behavior will be a function of that employee's
innate drives or felt needs and the opportunities he or she has
to satisfy those drives or needs in the workplace.
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 FEATURES OF MOTIVATION
 “Motivation is the act of stimulating someone or
oneself to get desired course of action, to push right
button to get desired reactions.”
 The following are the features of motivation :
1. Motivation is an act of managers
2. Motivation is a continuous process
3. Motivation can be positive or negative
4. Motivation is goal oriented
5. Motivation is complex in nature
6. Motivation is an art
7. Motivation is different from job satisfaction

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 Defining Motivation

Motivation
Is the process that initiates, guides and maintains goal-oriented
behaviors.
Is the result of an interaction between the person and a
situation .The processes that account for an individual’s intensity,
direction, and persistence of effort toward attaining a goal.
Motivation works best when individual needs are compatible with
organizational goals.
Key Elements
1. Intensity: how hard a person tries
2. Direction: toward beneficial/organizational goal
3. Persistence: how long a person tries

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 MOTIVATIONAL FACTORS
 There are several factors that motivate a person to work. The
motivational factors can be broadly divided into two groups:
 I. MONETARY FACTORS:
 Salaries or wages: Salaries or wages is one of the most
important motivational factors. Reasonable salaries must be
paid on time.
 Bonus: It refers to extra payment to employee over and above
salary given as an encouragement. The employees must be
given adequate rate of bonus.
 Incentives: The organization may also provide additional
incentives such as medical allowance, educational allowance,
HRA etc.

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 Motivational factors(cont’d)
II. NON MONETARY FACTORS:
1.Status or job title
2.Appreciation and recognition
3.Delegation of authority
4.Working conditions
5.Job security
6.Job enrichment
7.Workers participation
8.Good superiors
9.Cordial relations
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 Need and importance of motivation
 Motivation offers several Benefits/ importance to the
organization and to the employees:
1. Higher efficiency
2. Reduce absenteeism.
3. Reduces employee turn over.
4. Improves a corporate image.
5. Good relations.
6. Improved morale/self-confidence.
7. Reduced wastages and breakages.
8. Reduced accidents.
9. Facilitates initiative and innovation.

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Motivators

 Intrinsic
– A person’s internal desire to do something,
due to such things as interest, challenge,
and personal satisfaction.
 Extrinsic
– Motivation that comes from outside the
person, such as pay, bonuses, and other
tangible rewards.
 THEORIES OF MOTIVATION

 Early Theories of Motivation

 Maslow’s Hierarchy of Needs
 MacGregor’s Theories X and Y
 Herzberg’s Two-Factor Theory
 Contemporary Theories of Motivation
 Goal-Setting Theory
 Job Designing Theory
 Expectancy Theory

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 Hierarchy of Needs Theory (Maslow)

Hierarchy of Needs Theory

There is a hierarchy of five needs
—physiological, safety, social,
esteem, and self-actualization; as
each need is substantially
satisfied, the next need becomes
dominant.

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 Maslow’s Hierarchy of Needs
1. Physiological
includes hunger, thirst, shelter and other bodily needs
2. Safety
includes security and protection from physical and emotional
harm
3. Social
includes affection, belongingness, acceptance, and friendship
4. Esteem
includes internal esteem factors such as self-respect, autonomy,
and achievement; and external esteem factors such as status,
recognition, and attention
5. Self-actualization
the drive to become what one is capable of becoming; includes
growth, achieving one’s potential, and self-fulfillment
 Maslow’s Hierarchy of Needs

Lower-Order Needs Higher-Order Needs

Needs that are satisfied Needs that are satisfied
externally; physiological internally; social, esteem,
and safety needs. and self-actualization
needs.

Source: Motivation and Personality , 2nd ed,, by A.H. Maslow, 1970. E X H I B I T 6–1
Reprinted by permission of Prentice Hall, Inc., Upper Saddle River, NJ.
© 2005 Prentice Hall Inc. All rights reserved. 6–47
Theory X and Theory Y (Douglas McGregor)

Theory X
Assumes that employees dislike
work, lack ambition, avoid
responsibility, and must be
directed and coerced to perform.

Theory Y
Assumes that employees like
work, seek responsibility, are
capable of making decisions,
and exercise self-direction and
self-control when committed to
a goal.
Assumption: Motivation is maximized by participative decision
making, interesting jobs, and good group relations.
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 Two-Factor Theory (Frederick Herzberg)
 Job satisfaction and job dissatisfaction are created by different
factors. Attempted to explain why job satisfaction does not result in
increased performance.
 Hygiene factors: extrinsic (environmental) factors that create job
dissatisfaction.
 Motivators: intrinsic (psychological) factors that create job
satisfaction.

© 2005 Prentice Hall Inc. All rights reserved. 6–49

Two-Factor Theory -Frederick Herzberg (cont’d)

Two-Factor (Motivation-Hygiene) Theory

Intrinsic factors are related to job satisfaction,
while extrinsic factors are associated with
dissatisfaction.

Hygiene/maintenance Factors
Factors—such as company policy
and administration, supervision,
and salary—that, when adequate
in a job, Satisfy workers. When
factors are adequate, people will
not be dissatisfied.
© 2005 Prentice Hall Inc. All rights reserved. 6–50
 Goal-Setting Theory
 The theory that specific and difficult goals lead to
higher performance.
– Goals tell an employee what needs to be done and
how much effort will need to be expended.
– Specific goals increase performance; difficult goals,
when accepted, result in higher performance than do
easy goals; and feedback leads to higher performance
than does nonfeed back.
– Specific hard goals produce a higher level of output
than does the generalized goal of “do your best.”
 The specificity of the goal itself acts as an internal
stimulus.

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 Expectancy Theory
 The strength of a tendency to act in a certain way depends
on the strength of an expectation that the act will be followed
by a given outcome and on the attractiveness of that
outcome to the individual.
 The theory focuses on three relationships:
 Effort-performance relationship or the probability perceived
by the individual that exerting a given amount of effort will
lead to performance.
 Performance-reward relationship or the degree to which the
individual believes that performing at a particular level will
lead to the attainment of a desired outcome.
 Rewards-personal goals relationship or the degree to which
organizational rewards satisfy an individual’s personal goals
or needs and the attractiveness of those potential rewards
for the individual.
Expectancy Theory(cont’d)

Individu Individual Organizational Personal

Performance Rewards Goals
al Effort

1 2 3

1. Effort -performance relationship

(expectancy)
2. Performance -reward relationship
(instrumentality)
3. Rewards - personal goals relationship
(valence/attractiveness)
Steps to Increasing Motivation, Using Expectancy Theory
 Job Design Theory

Job Characteristics
Model Characteristics:
Identifies five job 1. Skill variety
characteristics and their 2. Task identity
relationship to personal
and work outcomes. 3. Task significance
4. Autonomy
5. Feedback

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 Job Design Theory (cont’d)
 Job Characteristics Model
– Jobs with skill variety, task identity, task significance,
autonomy, and for which feedback of results is given,
directly affect three psychological states of
employees:
• Knowledge of results
• Meaningfulness of work
• Personal feelings of responsibility for results
– Increases in these psychological states result in
increased motivation, performance, and job
satisfaction.
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 The Job Characteristics Model

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 Job Design Theory (cont’d)

Skill Variety
The degree to which a job requires
a variety of different activities.

Task Identity
The degree to which the job requires completion of
a whole and identifiable piece of work.

Task Significance
The degree to which the job has a substantial
impact on the lives or work of other people.
© 2005 Prentice Hall Inc. All rights reserved. 6–58
 Job Design Theory (cont’d)

Autonomy
The degree to which the job provides substantial
freedom and discretion to the individual in
scheduling the work and in determining the
procedures to be used in carrying it out.

© 2005 Prentice Hall Inc. All rights reserved. 6–59

 Job Design Theory (cont’d)

Feedback
The degree to which carrying out the work activities
required by a job results in the individual obtaining
direct and clear information about the effectiveness
of his or her performance.

© 2005 Prentice Hall Inc. All rights reserved. 6–60

 Computing a Motivating Potential Score

People who work on jobs with high core dimensions are

generally more motivated, satisfied, and productive.
Job dimensions operate through the psychological states in
influencing personal and work outcome variables rather
than influencing them directly.

© 2005 Prentice Hall Inc. All rights reserved. 6–61

From Theory to Practice:
Guidelines for Motivating Employees

 Use goals  Check the system for

 Ensure that goals are equity
perceived as  Use recognition
attainable  Show care and
 Individualize rewards concern for
 Link rewards to employees
performance  Don’t ignore money

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