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10.5 Compare and contrast charismatic and transformational leadership.

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Charismatic leadership theory:

A leadership theory that states that followers make attributions of heroic or extraordinary leadership abilities when they observe certain behaviours. They are set apart from ordinary people and treated as endowed with supernatural, superhuman, or at least specifically exceptional powers or qualities.

Characteristics of Charismatic Leaders:

1. Vision and articulation

2. Personal risk

3. Sensitivity to follower needs

4. Unconventional behaviour

Unfortunately, charismatic leaders who are larger than life don’t necessarily act in the best interests of their organisations. Many have allowed their personal goals to override the goals of the organisation.

2. Transformational leadership

Leaders who inspire followers to transcend their own self-interests and who are capable of having a profound and extraordinary effect on followers.

Transformational leaders pay attention to the concerns and needs of individual followers; they change followers’ awareness of issues by helping them look at old problems in new ways; and they excite and inspire followers to output extra effort to achieve group goals.

Characteristics of Transformational Leaders:

1. Idealised Influence:

2. Inspirational motivation

3. Intellectual stimulation

4. Individualised consideration

Characteristics of Transactional Leaders

1. Contingent reward

2. Management by exception (active)

3. Management by exception (passive):

4. Laissez-faire

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10.6 Define authentic leadership and show why effective leaders exemplify ethics and trust

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Authentic Leaders:

Leaders who know who they are, know what they believe in and value, and act on those values and beliefs openly and candidly. Their followers would consider them to be ethical people.

Ethics and leadership

-Unethical leaders use their charisma to enhance power over followers, directed toward self-serving ends. -Ethical leaders use it in a socially constructive way to serve others.-Leaders who treat their followers with fairness, especially by providing honest, frequent and accurate information, are seen as more effective.

- Leaders rated highly ethical tend to have followers who engage in high levels of organisational citizenship behaviours and who have an increased willingness to bring problems to the leaders’ attention.

- Because top executives set the moral tone for an organisation, they need to set high ethical standards, demonstrate them through their own behaviour, and encourage and reward integrity in others, while avoiding abuses of power, such as giving themselves large raises and bonuses while seeking to cut costs by laying offlongtime employees.

3. Servant leadership:

- A leadership style marked by going beyond the leader’s own self-interest and instead focusing on opportunities to help followers grow and develop.

- They do not use power to achieve ends; instead they emphasise persuasion.

- Characteristic behaviours include listening, empathising, persuading, accepting stewardship and actively developing followers’ poten-tial.

- Because servant leadership focuses on serving the needs of others, research has focused on its outcomes for the wellbeing of followers.

4. Trust and Leadership

- Trust is a psychological state that exists when you agree to make yourself vulnerable to another because you have positive expectations about how things are going to turn out.

- Even though you are not completely in control of the situation, you are willing to take a chance that the other person will come through for you.

- Trust is a primary attribute associated with leadership; breaking it can have serious adverse effects on a group’s performance.

What are the consequences of trust?

- • Trust encourages taking risks

- • Trust facilitates information sharing

- • Trusting groups are more effective

- • Trust enhances productivity

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