Leadership

PSYCH 485 blog

To be, or not to be—Appropriate

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What does it mean to lead ethically? To answer this question an individual must understand ethics, and its application to leadership. “Ethics is concerned with the kinds of values and morals an individual or society finds desirable or appropriate” (Williams, 2018, Lesson 14). Leader behavior is generally guided by the morals/values of self, the standards/values of others, and the right/wrongs appropriate in the situation. To be appropriate—is a choice for the leader. “Ethical leadership is rooted in respect, service, justice, honesty, and community” (Northouse, 2016, pg. 359). The choices made by leaders have implications on the outcome. This blog will briefly connect ethics to leadership and finally delve into some different scenarios.

Kolbergs’s Stages of Moral Development theorizes what innately forms an individual’s ethical leadership (Northouse, 2016, Table 13.1). Based on these ideas, moral development differentiates how the leader ethically functions. In the table below are 3 levels of reasoning based on the stage of an individual’s moral development.

There are two domains of ethical theories relating to leadership: “theories about leaders’ conduct and theories about leaders’ character” (Northouse, 2016, pg. 333). Character is an important factor in moral/ethical development, and conduct is the actual behavior. Leader’s concern varies somewhere between self-interest and the interest of others. Utilitarianism is the concern to do the “greatest good for the greatest number” (pg. 334). Every leader has a unique perspective and their ethical perspective consists of many complex factors. “All leaders have an agenda, a series of beliefs, proposals, values, ideas, and issues that they wish to ‘put on the table’” (Gini, 1998, p. 36). For ethical leadership, the leader must be appropriate to his or her followers and in the specific situation.

Being Appropriate

“Appropriate” ethical leadership involves responsibility and moral decency. Below are different perspectives from prominent leadership scholars. “The theme common to these authors is an ethic of caring, which pays attention to followers’ needs and the importance of leader–follower relationships” (Northouse, 2016, pg. 359).

• Heifetz’s Perspective: unique approach relative to existing theory. “Involves the use of authority to help followers deal with the conflicting values that emerge in rapidly changing work environments and social cultures” (Northouse, 2016, pg. 333).

• Burns’s Perspective: strongly tied to theory of transformational leadership. “Emphasizes the leader’s role in attending to the personal motivations and moral development of the follower” (pg. 337).

• Greenleaf’s Perspective: most affiliated with the theory of servant leadership. To be attentive to the concerns of followers and empathize with them. “A servant leader focuses on the needs of followers and helps them to become more knowledgeable, more free, and more like servants themselves” (Williams, 2018, Lesson 14).

An example of ethical leadership would involve a leader with a vision to promote the well-being of the organization as a whole (i.e., leader and followers), within the community and society. This example would entail the leader having moral decency and responsibility. The outcome would be considered in this context.

Of course all generic leadership theories can be made more robust by layering in ethical principles. For example, path-goal leadership with ethical behavior would consist of a leader who chooses appropriate relationship styles (i.e., implementing respect, service, justice, honesty, and community) and morally subscribed incentives to motivate followers (i.e., the right thing to do).

Being Inappropriate

Unethical leadership involves knowing “the right thing to do” and doing something less than that for selfish or harmful reasons. Unethical leadership lacks moral decency and fails to provide concern for others. There are many examples of unethical leaders. Briefly using the popular Bernie Madoff, this leader earned the trust of several people as an investment advisor. These followers were unaware that Madoff lied to them and used their funds to his own personal gain. Madoff’s behavior lacked respect, service, justice, honesty, and community. “The disgraced financier Bernie Madoff has been sentenced to the maximum 150 years in prison for masterminding a $65bn (£38bn) fraud that wrecked the lives of thousands of investors” (Teather, 2009, web).

To contrast the same leadership theory from the previous topic, path-goal will be used again. Path-goal leadership with unethical leadership would involve leader behavior that does not care about the follower, lacks moral decency, and does harm to others. More specifically, the unethical leader may purposely obstruct goals, fail to clear paths and obstacles, and lack support. This leader would not likely show concern to the follower’s motivations or help the follower according to their individual characteristics. There would likely be a lack of reward for the follower and no standard of excellence for the follower to achieve.

Some unethical leadership relationships involve destructive leaders, combined with susceptible followers and conducive environments. The figure below illustrates the situation where leaders, followers, and environments reinforce unethical situations (Northouse, 2016, pg. 341).


The elements illustrated in the “Toxic Triangle” perpetuate “Dark Side of Leadership” and are characterized by the leader’s lack of ethics and selfish aims.

Personal Experience in Ethical Leadership

In this one section I will drop the academic writing style and go in first person. This is ethical leadership because I feel that I can relay my message (to possible followers) better in this situation. According to the rules this is not the “right thing to do.”

In used car sales, I’ve seen a lot of both ethical and unethical behavior. Let’s start with the unethical. I’ve seen other dealers put wood grinds in transmissions to get another week of life out of a car they’re selling. Then they order their salesman to sell it as-is. This is unethical leadership for several reasons. First, they are teaching their salesman to be fraudulent and not teaching them the ways to do good business long-term. Second, the customer, a follower of the dealer’s advice and trust, is duped into buying something the dealer knows is misrepresented. And the unethical leader did all this with a selfish aim and lack of concern.

As a leader, I try to build up my employees. For example, using the transformational approach, I hire followers who aspire to be the best in their trade. If I hire a mechanic, I encourage more certifications and training. If I hire a porter, I expand on their abilities for other opportunities. With all my employees, I create a vision that if we keep up the good work we will succeed together (in terms of auto dealerships).

I haven’t always been the most ethical however. My moral development came in stages like Kohlberg’s ideas in the table above. My ethical leadership is something I’m proud of now and it has become part of the kind of person I want to be identified as. In the community, reputations are earned and in society we all have a small price to pay for a collective well-being. Ethical leadership is important, even if it is only used to teach what is appropriate in practice.

Conclusion

Leading people the wrong way can have disastrous effects. “Leaders have a responsibility to attend to others, be of service to them, and make decisions pertaining to them that are beneficial and not harmful to their welfare” (Northouse, 2016, pg. 343). This is especially true with leaders of large organizations and public masses. To be appropriate is to be morally decent and practice care. These are the kinds of leader choices an individual or society finds desirable.

“Leading ethically requires not only clear principles and integrity but also, in the public sector, with its high standards, a sense of duty, spirit, sustainability, and even sacrifice on occasion; such leadership tends to be built on superior self‐knowledge and a sense of optimism infused with energy and perseverance” (Van Wart, 2013).

References

Gini, A. (1998). Moral leadership and business ethics. In J. B. Ciulla (Ed.), Ethics, the heart of leadership (pp. 27–46). Westport, CT: Greenwood.

Northouse, Peter. (2016). Leadership: Theory and Practice. Los Angeles: Sage Publications.

Teather, David. 2009, June 30. Bernard Madoff receives maximum 150 year sentence. The Guardian [web]. Retrieved from https://www.theguardian.com/business/2009/jun/29/bernard-madoff-sentence

Van Wart, M. (2013). Lessons from leadership theory and the contemporary challenges of leaders. Public Administration Review, 73(4), 553-565. doi:10.1111/puar.12069

Williams, Jason. (2018). Pennsylvania State University. Lesson 14: Ethics and Leadership. Description of Ethics– Research. Retrieved at https://psu.instructure.com/courses/1940315/modules/items/24597615

Entrepreneurial Leadership (EL)

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An entrepreneur is an individual who creates a business and runs it while taking all the financial risk. It is imperative that an entrepreneur have leadership skills for his or her venture to be successful. Leadership must be implemented by the founder with employees and others involved in the startup and life of the business. Entrepreneurial Leadership (EL) is a redundant term because to be a successful entrepreneur, you must be a leader, but a leader is not an entrepreneur. In this discussion I will explain EL, discuss my own experience in EL, and explain why effective leadership is one of the most important factors for entrepreneurial success.

Why is the topic of entrepreneurship important? It’s important to me because I’ve started my own business and I run it myself. I am an entrepreneur. But more importantly, “Almost half of the working population in the United States will try to become an entrepreneur during their working career” (Lidow, 2014, pg. 5). To some, “Entrepreneurship is the New American Dream, and millennials are hearing its call loud and clear” (Dennis, 2015, Abstract). The “United States, are more likely to have a thriving entrepreneurial culture, where individuals are willing to take risks and make quick business decisions (Northouse, 2016, pg. 432). There are many risks involved in a business startup, but if the business proves successful, many rewards.

It is easy to understand why entrepreneurs are leaders when you consider the leader/follower relationship. Followers, by definition, follow. In the work world, followers have a boss or supervisor. Entrepreneurs are the boss, and a boss is a leader. This is not to say that followers are any less important to the business because, “from their joint participation emerges the success or failure of their enterprise” (Heller, 1983, pg. 406). And to run a successful business, an entrepreneur needs the help of others. “Others (a group) are required for leadership to occur” (Northouse, 2016, pg. 6). In short, an entrepreneur has a business mission, needs help to build the business, and must have the ability to lead to be successful. “Entrepreneurial leaders have visions that require innovation and creativity. Their visions could change the rules of the game forever” (Clark, 2002, pg. 14). But innovation and creativity are not enough—there must be a group working toward the common goal to implement those ideas. The term “EL” simply emphasizes the importance of leadership for the entrepreneur.

Leading an enterprise all the way from conception to the point where it is producing value and is self-sustaining— which means you are succeeding as an EL— is much more challenging than starting a company. If you want to see your idea reach its full potential, if you want to enjoy the fulfillment that comes from having made a tangible difference in the world, if you want to achieve financial success, then you must aspire to be an entrepreneurial leader. –Lidow, 2014, pg.6

For example, I will briefly offer my own experience in running a business. When I was 16 years old I started a business of buying and selling cars. I worked alone and there was only so much I could do without assistance. Buying one lemon (a mechanically defected vehicle) would take me months to recover from financially. There was no EL because there was no leadership. I was an entrepreneur but not successful. The business lost money. Today, as an adult, I have employees. I have a mechanic who inspects vehicles before purchase, I have a detailer, a porter, an accountant. I employ followers who specialize in certain tasks. The business is profitable. My vision and leadership (including employing the right followers) are what I attribute to this financial success. From experience I feel confident insisting that entrepreneurship requires leadership. I make this claim because when my EL falters in leadership, it follows that my business falters correspondingly.

In conclusion, according to the Bureau of Labor Statistics, only 50.2% of private sector businesses survive past 5 years (BLS Gov., 2017, table). Why do so many businesses fail? Again, it is my assertion that they fail due to inept leadership. Of course, some of these tasks may be delegated to managers; nonetheless, juggling these responsibilities correctly is crucial to the survival of the business. The entrepreneur has many responsibilities: business design, financial obligations, competition, hiring the right followers, and human resources, etc. This takes a leader. It is not enough to simply be an entrepreneur or business starter. Success requires the next level of entrepreneurship. Success requires EL. Leadership is crucial.

 

References

Bureau of Labor Staistics. 2017, March. U.S. Government [table]. Retrieved from https://www.bls.gov/bdm/us_age_naics_00_table7.txt

Clark, G. (2002, Apr 01). So just what is an entrepreneur?: And why it actually matters. Profit, 21, 14. Retrieved from http://ezaccess.libraries.psu.edu/login?url=https://search-proquest-com.ezaccess.libraries.psu.edu/docview/219310255?accountid=13158

Dennis, D. (2015). If the new american dream is entrepreneurship, why are so many black millennials Missing Out? [abstract] Techcrunch

Heller, T., & Van Til, J. (1983). Leadership and followership: Some summary propositions. Journal of Applied Behavioral Science, 18, 405–414.

Lidow, Derek. Startup Leadership : How Savvy Entrepreneurs Turn Their Ideas into Successful Enterprises, John Wiley & Sons, Incorporated, 2014. ProQuest Ebook Central. Retrieved from http://ebookcentral.proquest.com/lib/pensu/detail.action?docID=1637066.

Northouse, Peter. (2016). Leadership: Theory and Practice. Los Angeles: Sage Publications.

Next Level Leadership

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Are there different levels of leadership success? When considering leadership outcomes there must be. Leaders of different companies in the same industry have different results all the time. Of course, we can analyze success in different areas like profit margin or employee retention rates but let’s keep it simple and use overall effectiveness. There are plenty of companies that sell the same product but have different financial outcomes. Should we attribute these occurrences to luck or leadership? You may be thinking, “well one company may have a better marketing department, or better customer service, etc., etc.”.; but isn’t it the leader of that company who holds ultimate responsibility. This post intends to offer the “why” for different levels of leadership and then explain the “how” in taking leadership to a higher level of success. (Although, this premise can be used in leadership outside of business, I will be focusing on business leadership in this discussion).

In explaining “why” I believe there are different levels of leadership success, I will start by simply pointing out the differing effectiveness levels of transformational, transactional, and laissez-faire leadership. “Transformational leadership is a better predictor of organizational effectiveness than transactional or laissez-faire leadership” (Williams, 2018, Less. 10). Does organizational effectiveness translate to revenue earning effectiveness? I think it does, ceteris paribus. Using earnings as our measure, I think it is fair to say that transformational leadership is most effective, transactional leadership follows, and least effective is laissez-faire leadership. We have 3 levels already! To reinforce my point; Lowe, Kroeck, and Sivasubramaniam (1996) “found that people who exhibited transformational leadership were perceived to be more effective leaders with better work outcomes than those who exhibited only transactional leadership” (Northouse, 2016, pg. 116). It is how the leader behaves that changes the level of leadership effectiveness. “Transformational leadership behavior that elicits second-order changes in employee efforts is more highly associated with effectiveness than the traditional first order changes resulting from transactional behaviors. (Lowe, Kroeck, and Sivasubramaniam, 1996, pg. 420).

Explaining every leadership theory that suggests why leadership has levels of success is beyond the scope of this blog. I’m merely scratching the surface to show that different levels of leadership effectiveness exist. Effectiveness promotes success. And success is measured in levels. I’ll offer one more connection that has its roots in the skills approach: social intelligence. “Successful leaders have as individual characteristics two components of social intelligence, social perceptiveness and behavioral flexibility” (Zaccaro et al., 1991, pg. 317). It is proposed that leaders with advanced skill in these two characteristics (of social intelligence) will be more effective in leadership. This theory holds the potential of many levels of leadership success.

Now on to the “how.” How can a leader elevate to a higher level of success? If you’ve read this far, the answer should be apparent—focus on the “why.” My argument is that if an individual learns the exact reasons that one leader functions on a higher level than another, than it simply follows to develop in those reasons to raise that level. The “why” is peppered throughout all the leadership theories and the “how” is to internalize and develop. “Patterns of abilities, motives and personality characteristics associated with higher skill and knowledge levels are positively related to leader performance” (Mumford, Zaccaro, Connelly, et al., 2000, pg. 159). I’m convinced leadership can be learned and developed. “Leadership development address observable, conscious, and rational phenomena” (Northouse, 2016, pg. 296). Developing an individual’s leadership leads to next level leadership.

In conclusion, knowing “why” certain skills, behaviors, situations, relationships, etc., work in leadership is what I propose is the most important factor in leadership success. “And it’s those who start with ‘why’ that have the ability to inspire those around them or find others who inspire them” (Sinek, 2009, 17:40).

 

References

Lowe, K. B., Kroeck, K. G., & Sivasubramaniam, N. (1996). Effectiveness correlates of transformational and transactional leadership: A meta-analytic review of the MLQ literature. Leadership Quarterly, 7(3), 385–425.

Mumford, M. D., Zaccaro, S. J., Connelly, M. S., & Marks, M. A. (2000). Leadership skills: Conclusions and future directions. Leadership Quarterly, 11(1), 155–170.

Northouse, Peter. (2016). Leadership: Theory and Practice. Los Angeles: Sage Publications.

Sinek, Simon. 2009, Sept. TEDtalks. How great leaders inspire action. Retrieved at https://www.ted.com/talks/simon_sinek_how_great_leaders_inspire_action

Williams, Jason. (2018). Pennsylvania State University. Lesson 10: Transformational Leadership. A Model of Transformational Leadership – Research. Retrieved at https://psu.instructure.com/courses/1940315/modules/items/24597570

Zaccaro, S. J., Gilbert, J., Thor, K. K., & Mumford, M. D. (1991). Leadership and social intelligence: Linking social perceptiveness and behavioral flexibility to leader effectiveness. Leadership Quarterly, 2, 317–331.

 

Employing the Right Followers

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Financial well-being is a pursuit important to many of us. Both leaders and followers alike seek to improve their station in life by employment, investment, and budgeting. Many that seek wealth follow leaders who are already wealthy. This is the case in most corporations where the CEO is the highest paid employee and leads the rest of the company. When considering the wealthiest individuals in the United States there is no doubt that Warren Buffet is among the richest. Buffet is ranked number four in the 2018 ranking of the world’s billionaires (Forbes, 2018). How did Buffet become so wealthy? Did he do it individually? Or did he lead followers?

This blog is an effort to show what kind of followers Warren Buffet required to make his fortune. His great skill in investments is not the only factor—Buffet’s great skill in leadership is just as important. As CEO of Berkshire Hathaway, Buffet “has grown the market value of this company at a compound growth rate of over 25% per year” (O’Loughlin, 2002, pg. 1). Although Buffet may seem to be attributed all the credit for this extraordinary accomplishment, he did not make these gains without followers. “Buffett has not delivered this performance by being a stock picker. He has done it by being a CEO: by leading people and by managing capital” (O’Loughlin, 2002, pg. 2, emphasis added).

This blog is not about how exceptional of an investor Warren Buffet is. This blog is about the leadership/followership that created the outcome that puts Buffet on the Forbes list. “Leadership and followership are two sides of the same coin, each intimately connected with the other in a dynamic manner” (Riggio, et. al. 2008, pg. 93). If the leader talent is there, what’s important about the followers? From the research, the most important element seems to be hiring the right followers. In a 2015 letter to shareholders, Buffet noted that “Character is crucial” (McGregor, 2015). From CEO, down the line to first line managers, Buffet sought new hires with the right skill sets and characteristics to align with the mission of the company. This approach is like the contingency model of leadership, but instead of the leader using “a leadership style that best meets followers’ motivational needs” (Northouse, 2015, pg. 115), Buffet hired followers that best met the organizations thrust. “As a manager, you can’t just tell people what to do and expect them to do it. You have to find some other way, some other form of leadership. They have to be motivated personally to do it (O’Loughlin, 2002, pg. 48). Buffet advises to “pick out a few heroes” and that “there’s nothing like the right ones” (pg. 5).

To sum this up, Buffet is an exceptional investor and leader who hired followers based on matching the organizations mission. Well, what then is necessary from the followers to want to be led by Buffet? Berkshire Hathaway’s net worth and employee compensation may be enough to attract new hires, but what keeps the followers motivated after that? Most important is trust. The follower must trust that the goals will be met, and success and satisfaction will be maintained. “A leader’s capacity to cultivate follower trust affects his or her ability to direct followers” (Hernandez, et al. 2014, pg. 1). Buffet cultivates follower trust by communication of the organizations guiding principles, stability in the industry, and philanthropy.

Reference

Forbes. (2018) Online. The World’s Billionaires. 2018 Ranking. Real time ranking. The List. Retrieved on 5/31/18 at https://www.forbes.com/billionaires/list/#version:realtime

Hernandez, M., Long, C. P., & Sitkin, S. B. (2014). Cultivating follower trust: Are all leader behaviors equally influential? Organization Studies, 35(12), 1867-1892. doi:10.1177/0170840614546152

McGregor, J. (2015). The leadership wisdom of Warren Buffett. Washington: WP Company LLC d/b/a The Washington Post.

Northouse, P. G. (2015). Leadership: Theory and practice (Seventh ed.). Los Angeles: SAGE Publications, Inc.

O’Loughlin, J., & Net Library, I. (2002). The real warren Buffett: Managing capital, leading people. Yarmouth, Me; London: Nicholas Brealey.

Riggio, R. E., Chaleff, I., & Lipman-Blumen, J. (2008). The art of followership: How great followers create great leaders and organizations (1st;1. Aufl.; ed.). San Francisco, CA: Jossey-Bass.

Leader Intelligence

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Borrowing from the trait approach in leadership theory, in this post I will be expanding on intelligence–in all of its theories of multiplicity. Before I begin, I’d like to share with you my path to this topic. Until recently, I believed that leaders were predetermined by a compilation of traits that some fortunate people possess (likely born with). I thought for sure there was a universal checklist of leadership traits that confirmed an individual as a leader. To my surprise, “the trait approach has failed to provide a definitive list of leadership traits” (Northouse, pg.41). This only started making sense to me after I read Northouse’s major leadership traits: intelligence, self-confidence, determination, integrity, & sociability (pg.23). I thought to myself, “Hey…I must be a leader because I possess all these traits!” but then a long list of reasons why I’m not a leader now flooded into my mind. Eventually I’ve come to agree that “leadership is not primarily a particular personality trait” (Chand, 2018) and Leadership is more a complex process (Northouse, pg. 17). Nonetheless, I cannot abandon the notion that traits are related. So my inquiry became what is the most important trait? At first thought, I believed it to be intelligence. Not just IQ, but the full spectrum of intelligence.

I’ve previously read on emotional intelligence (EQ) and at the time it made a lot of sense to me that this is different than IQ, but likely just as important. The components of emotional intelligence include “self-awareness, self-regulation, motivation, empathy, and social skill” (Goleman, 2005). I’ve previously read on social intelligence, and like EQ, I thought it was very important. Social intelligence explains the accuracy of first impressions, the basis of charisma and emotional power, the complexity of sexual attraction, and how we detect lies (Goleman, 2006). This previous understanding of “other” forms of intelligence inspired me to write this paper on the necessity of having a multidimensional intelligence (i.e. to be a leader). But does that make sense? While researching for this post, I’ve found so many theories on different intelligence models I’ve never heard of, that maybe I’m quite unintelligent! Or maybe not. What if all these other forms of intelligence are just groups of traits packaged together and labeled wholesale as a form of intelligence. If I think of it that way the confusion clears and I can see IQ and other traits for what they really are–personal attributes that simply effect the process, situation, and outcomes of leadership.

I do still believe that intelligence is an important trait for a leader, but I’m not convinced that IQ is more important than other traits such as extraversion, charisma, or critical thinking. Leadership is not something that can be predicted simply based on traits. And I have not found any evidence to support that intelligence is more important than other traits. “People who possess certain traits that make them leaders in one situation may not be leaders in another situation” (Northouse, pg.31).

In reviewing my thinking, I’m proud of myself because I would have been correct if other forms of intelligence were scientifically backed. What I mean is that if a leader had high aptitudes in all the various trending intelligence theories, that individual would likely possess hundreds of useful traits or skills. Having one giant label for hundreds of (leadership useful) traits is of course stronger than one stand alone trait. However, “if no-one is really sure what these supposed ‘intelligences’ really are or how to assess them, then generating scientific support for them would appear to be quite difficult”(McGreal, 2013). Although, “HBR’s editors reported on the strong link between empathetic leaders and financial performance” (Ovans, 2015), again, this is just one trait (empathy) and it’s outcome doesn’t erase the need to consider the process and situation as well.

In conclusion, I’ve come full circle in intelligence; “Intelligence is not enough to guarantee leadership success” (PSU, 2018). Although I set out to prove my professor wrong, I’ve come to agree now. Intelligence is only one trait in a long list of other very important traits for leadership. The smarter way to evaluate intelligence is “as one factor, intelligence is often referred to as general mental ability (GMA) or general factor (g factor) or g for short. More commonly, g is referred to as IQ (intelligence quotient), but that term actually refers to a score on an intelligence test” (PSU, 2018). While the g factor is advantageous to leadership ability, other traits, skills, temperaments are often as important, or more important depending on the leader/follower group, the situation, and the goals sought.

Works Cited
Chand, Smriti. (2018) Leadership: Characteristics, Principles, Types, and Issues Regarding Leadership. Accessed on 5-19-18 at

Goleman, D. (2005). Emotional intelligence (10th anniversary trade pbk. ed.). New York: Bantam Books.

Goleman, D. (2006). Social intelligence: The new science of human relationships. New York: Bantam Books.

McGreal, Scott. (2013) Psychology Today. The Illusory Theory of Multiple Intelligences. Gardner’s theory of Multiple Intelligences has never been validated. Accessed on 5-19-18 at

Pennsylvania State University. (2018). Lesson 2: Trait Approach. Intelligence and Leadership. PSYCH 485. Accessed on 5-19-18 at

Pennsylvania State University. (2018). Lesson 2: Trait Approach. g Factor. Accessed on 5-19-18 at

Northouse, P. G. (2015). Leadership: Theory and practice (Seventh ed.). Los Angeles: SAGE Publications, Inc.

Ovans, Andrea. (2015) Harvard Business Review. Emotional intelligence. How Emotional Intelligence Became a Key Leadership Skill

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