LUCKY MAHALI

LEADERSHIP

LEADERSHIP
Introduction to
Organizational
Behavior
Chapter 11 :
Leadership
Definition of
Leadership
Traits of Effective
Leaders
Leadership Behaviors
Vs Traits
Leadership Skills
Leadership Theories
Trait Theories
Behavioral
Theories
Contingency
Approaches to
Leadership
Chapter Summary
There is no agreement
among management
theorists on the definition
of leadership. Though most
of them do agree that
leadership involves
influencing others, the
disagreement arises on the
issue of how this takes
place. Another issue of
contention among experts
is whether managing and
leading are equivalent.
According to some experts,
managers and leaders are
different. Managers
generally devote their time
to developing plans,
organizational structures
and controlling deviations
from the plans.
Leaders focus on
developing a vision for the
future, communicating the
vision to people,
integrating the efforts of
their followers, helping
them overcome hurdles
and developing their
abilities to realize the
vision. Managers derive
their power from their
position in the
organization. Leaders do
not need any formal
authority but derive power
from people who follow
them because of their
abilities.
Leadership is the ability to
influence people and drive
them toward the
achievement of goals. The
research on leadership
has led to the development
of three types of theories
- Trait, behavioral and
contingency theories.
According to trait theories,
some traits such as
extroversion,
aggressiveness, self-
confidence, honesty and
integrity and intelligence
differentiate leaders form
non-leaders. According to
the behavioristic school,
successful leadership
depends more on
appropriate behavior and
skills, and less on
personality traits. The
three broad types of skills
used by leaders, as
identified by Robert Katz,
are technical, human and
conceptual skills.
Four different behavioral
theories - the Ohio State
Studies, the University of
Michigan Studies, the
Managerial Grid and the
Scandinavian Studies -
sought to identify the
different behaviors
adopted by leaders. The
Ohio State Studies
concluded that leaders who
score high on the
dimensions of initiating
structure (task orientation)
and consideration (concern
for people) achieve
superior subordinate
performance and
satisfaction, compared to
those who score low on
either one of them or both.
The Michigan Studies found
that an employee-centered
style of leadership is more
effective than a
production-centered style
of leadership. The
Managerial Grid proposed
by Blake and Mouton
suggested that leaders
who have equal concern
for people and production
are most effective. The
Scandinavian studies
resulted in the emergence
of a new dimension called
'development-oriented'
behavior. According to
these studies, leaders who
embrace change and
encourage new ideas and
practices are successful.
The contingency theories
deal with the situational
aspects of leadership
styles. Some of the well
known contingency
theories are Fiedler's
contingency model, Hersey
and Blanchard's situational
theory, Leader-Member
exchange theory, Leader
Participation model and the
Path-Goal theory. Fiedler's
model suggests that the
leader should choose his
style of leadership
depending on the
favorability or
unfavorability of the
overall situation.
Hersey and Blanchard's
situational theory states
that the most critical factor
that influences the
selection of a leader's
style is the maturity level
of his subordinates. The
Leader-Member exchange
theory suggests that
leaders try and establish a
special relationship with a
small group of
subordinates; this small
group would constitute an
in-group, with all the rest
of subordinates being in an
out-group. The in-group
members get more
attention from the leader
and enjoy special
privileges. The Leader
participation approach
provides a sequential set
of rules that can be
followed for identifying the
type of situation and
determining the amount of
participation that should be
demanded from
subordinates for decision
making.
According to the Path-Goal
theory, the leader should
guide his followers in
achieving the
organizational goals, and
also establish individual
and group goals that are
compatible with the broad
organizational goals.
Presented by
Mr.shivasankar mahali(lucky mahali)

EMPOWERMENT PARTICIPATION

EMPOWERMENT
PARTICIPATION
Chapter 12 :
Empowerment and
Participation
Empowerment
Participation
The Process of
Participation
Advantages of
Participation
Essential
Prerequisites for
Successful
Participation
Programs for
Participation
Consultative
Management
Suggestion
Programs
Programs
Emphasizing
Quality
Middle-
Management
Committees
Industrial
Democracy
Self-Managing
Teams
Limitations of
Participation
Chapter Summary
The term empowerment
means giving employees
power and authority to
make decisions on their
own. When people are
allowed to work with
minimal interference from
their superiors and are
given the authority and
responsibility to make
decisions, they are said to
be empowered. Employees
can be empowered by
ensuring their participation
in decision-making.
Participation is defined as
the mental and emotional
involvement of people in
the activities of the group,
which encourages them
take responsibility for and
contribute to the
achievement of group
goals.
Participation proves
advantageous for the
organization in many ways.
It improves the quality and
quantity of output. It also
improves the motivation
levels of employees,
decreases the rate of
attrition and absenteeism,
and improves
communication within the
organization. Other lesser
tangible benefits are
decreases in the number of
conflicts, lower stress
levels, greater commitment
to goals, and lower
resistance to change.
Certain prerequisites are
essential for participation;
for instance, adequate time
should be allowed for
participation, and the
potential benefits of
participation should be
greater than the costs
involved. For participating
effectively, the employees
must also have the
relevant abilities and
skills, and should be
interested in that particular
area of work. The
participants should be able
to exchange their ideas
effectively with each other
and they should not
perceive the process as a
threat to their position or
status. The degree of
participation also depends
on the area of job freedom
for that particular
department.
There are many programs
that can be used to
encourage participation of
employees. Some programs
involve employees only to
a modest extent, while
other programs require a
substantial amount of
participation from
employees. The most
common participation
programs are consultative
management, suggestion
programs, quality circles
and TQM, middle-
management committees,
industrial democracy and
self-managing teams. One
or more of such programs
can be used within the
same organization.
Consultative management
refers to the practice of
managers obtaining
feedback and contributions
from employees on certain
issues for making
decisions. Suggestion
programs are formal plans
developed by the
organization which invite
the employees to give
suggestions for work
improvements. Quality
circles are voluntary
groups, comprising
employees who are trained
in statistical techniques
and problem-solving skills.
They attempt to generate
ideas to improve the
working conditions and
productivity of the
organization.
The TQM approach is an
ongoing effort to involve
all employees of an
organization in the search
for novel ways to improve
its operations. This
approach involves training
employees in statistical
methods and giving them
the opportunity to develop
extensive problem-solving
and group decision-making
skills. Middle-management
committees provide junior
directors the opportunity
to understand a particular
problem and recommend
solutions for it. The board
of junior directors carefully
studies and analyzes the
problem and presents its
recommendations to the top
management.
Industrial democracy is a
participation program in
which workers'
participation at various
levels is made mandatory
by the government,
especially for those
decisions that affect the
workers. Self-managing
teams undertake
extensive group
discussions and use the
ideas and influence of the
group for making decisions.
Participation has a few
limitations. Due to the
complex technology and
organizational structure of
today's work setup, some
people may find it difficult
to participate in different
and varied organizational
issues. Problems may also
crop up when employees
make suggestions in areas
where they are not really
competent.
Employees may expect
consultation on every
issue, whether they have
the relevant expertise or
not, and when they are not
consulted, they may feel
resentful. Some superiors
too may face difficulties in
relating to their
subordinates as they may
feel that their traditional
authority is threatened.
They may be uncomfortable
in their roles as coaches
and facilitators. Another
serious drawback of
participation is that it could
be u

INFORMAL ORGANIZATIONS

INFORMAL
ORGANIZATIONS
Chapter 16 :
Informal
Organizations
Nature of Informal
Organizations
Benefits and Problems
of Informal
Organizations
Informal Communication
Essential
Features of the
Grapevine
Factors
Responsible for
Grapevine
Patterns of the
Grapevine
Management
Response to the
Grapevine
Difference
between a
Grapevine and a
Rumor
Managing Informal
Organizations
Chapter Summary
An informal organization
refers to all the channels
of interaction that are not
defined by the formal
organizational structure.
As opposed to the formal
organization, the various
relationships in an informal
organization arise
spontaneously as people
interact with one another
and discover common
areas of interest. There
are various differences
between a formal and an
informal organization. In a
formal organization, the
primary focus is on the
official position, held by an
individual while in an
informal organization; it is
on the relationships
between people. Another
significant difference
between formal and
informal organizations is
that power in a formal
organization is derived
from the position held in
the organization, while, in
an informal organization,
the personality of the
individual provide him with
power.
According to J. L. Gray and
F. A. Starke, formal and
informal organizations also
differ from each other on
the parameters of
organizational structure,
position terminology, goals
of the organization, basis
of influence, control
mechanisms, channels of
communication, charting of
member relationships, and
mixed characteristics.
Members of an informal
organization differ from
one another in their
experience, seniority,
salary, educational or
technical qualifications,
personality, birthplace and
the nature of their
workplace. These
characteristics not only
differentiate the members
of an informal organization,
but also accord status to
them. The informal leaders
are chosen on the basis of
the status ascribed to them
by the other members of
the informal organization.
These leaders wield a
considerable amount of
personal power and can
affect the productivity of
the organization either
positively or negatively.
Although it is not
necessary for an informal
organization to have only
one informal leader, the
person who exercises a
greater degree of control
over the other members of
the informal organization is
generally considered the
primary leader. The
management of an
organization should
identify these informal
leaders and develop a
good professional
relationship with them to
facilitate the smooth
functioning of the
organization.
Informal organizations
benefit the organization in
many ways. They help in
the development of an
effective organizational
system and reduce the
workload of managers.
Informal organizations also
provide employees with an
outlet to express their
anxieties and problems,
improve job satisfaction,
and reduce employee
turnover.
In spite of its merits,
informal organizations, at
times, also create many
problems. It may act as a
barrier to organizational
change. Conflicts may also
arise between the members
of the informal
organization. Sometimes,
its members may
experience a conflict due
to the diverse roles they
have to play as members
of the formal work group
and the informal group.
The biggest problem an
informal organization faces
is to ensure that the
members conform to its
norms and the use of
penalties and sanctions to
punish those who deviate
from these norms.
The communication channel
in an informal organization
is called the grapevine.
The grapevine thrives in
all those places where
people interact with one
another and tends to be
active in periods of stress
or insecurity. The nature
of a person's job as well
as his personality affects
the role he plays in a
grapevine. Earlier, the
management ignored the
grapevine. Now however,
in many organizations, the
management acknowledges
the presence of the
grapevine. It tries to
identify the key players in
the grapevine and how
information travels along
the grapevine.
Rumors are so strongly
associated with the
grapevine that these two
terms are often used
interchangeably. However,
they do not mean the same.
A Rumor is incorrect
information that is not
supported by substantial
evidence. It generally
arises out of ambiguity and
interest in a particular
situation. Various types of
rumors may spread in an
organization and the
management can control
rumors by paying heed to
them, identifying the
causes, and above all, by
releasing the facts behind
the rumors. The
management can also seek
the support of union
leaders to prevent the
damage caused by rumors.
The management should
realize that informal
organizations cannot be
done away with. They
s

FOUNDATIONS OF ORGANIZATION

FOUNDATIONS OF
ORGANIZATION
Chapter 17 :
Foundations of
Organization
Structure
Definition of Structure
Key Elements in
Designing an
Organization Structure
Work
Specialization
Departmentalizatio
n
Chain of Command
Span of Control
Centralization/
Decentralization
Formalization
Types of
Organizational Designs
Simple Structure
Bureaucratic
Structure
Matrix Structure
Organizational Designs
and Employee Behavior
Chapter Summary
The framework of tasks,
reporting and authority
relationships within which
an organization functions is
referred to as the
organization structure.
There are six basic
elements which form the
basis of an organization
structure: They include
work specialization,
departmentalization, chain
of command, span of
control, centralization/
decentralization and
formalization. The degree to
which tasks are divided into
sub-tasks and each sub-
task is carried out by an
individual employee is
referred to as work
specialization. The grouping
of similar jobs to achieve
better coordination among
them is referred to as
departmentalization.
The chain of command is an
unbroken line of authority
that establishes clear
reporting relationships
among various levels in the
organization. The ratio of
managers to their immediate
subordinates in an
organization is referred to
as span of control. The
degree to which decision
making power is
concentrated at the top
most level of the
organization is referred to
as centralization. The
degree to which rules and
procedures govern the
duties and responsibilities
of employees in
organizations is referred to
as formalization.
The three most commonly
used organization
structures are simple
structure, bureaucratic
structure and matrix
structure. In simple
structures, there is a low
degree of
departmentalization and
formalization, a wide span
of control and centralized
decision making. In
bureaucratic structures,
there is a high degree of
work specialization,
formalization, centralization
and departmentalization.
Such structures have a
narrow span of control and
support the principle of
unity of command.
The matrix structure
combines two organizational
designs - functional design
and project design - to gain
the advantages of both.
The principle of unity of
command is violated in this
structure as employees are
required to report to two
heads - the functional head
and the project head.
Matrix structures offer
flexibility, facilitate better
communication and
coordination among the
different departments, and
enable the efficient
allocation of resources.

DECISION MAKING
Chapter 18 :
Decision Making
The Nature of
Decision Making
Decision Rationality
Types of Decisions
Programmed
Decisions
Non-programmed
Decisions
Models of Behavioral
Decision Making
Economic
Rationality Model
Simon's Bounded
Rationality Model
The Judgmental
Heuristics and
Biases Model
The Social Model
Behaviorally Oriented
Decision-Making
Techniques
Traditional
Participative
Techniques
Modern
Participative
Techniques
Creativity and
Decision Making
Group Decision Making
Group
Polarization
Groupthink and
Group Problem
Solving
Chapter Summary
Decision making is an
integral function of
management. Decision
making involves selecting
or choosing a particular
course of action from
among the various
alternatives available in
the decision making
situation. The process of
decision making, as
described by Herbert
A.Simon, involves 3
phases, namely intelligence
activity phase, design
activity phase and choice
activity phase. The
intelligence activity phase
relates to identification of
the problem. The design
activity phase includes
developing and analyzing
various courses of action
and the choice activity
phase involves choosing
the best course of action.
Rationality in decision
making refers to the
appropriateness of the
chosen means towards
accomplishment of the end
objectives. Decisions made
by managers may be
programmed or non-
programmed in nature
depending upon the
frequency of occurrence of
the decision making
situation. A programmed
decision is the decision
that is made when the
decision maker has
adequate information
pertaining to the decision
making situation. These
decisions are routinely
made decisions. Non-
programmed decisions, on
the other hand, are the
decisions made in
situations which occur
rarely or are unfamiliar. In
this case, the process of
decision making involves
identification and
evaluation of alternatives
without the aid of a
decision rule.
The role and importance of
human behavior is
emphasized by the
behavioral model of
decision making. Four
variations of behavioral
models are discussed in
the chapter. The economic
rationality model assumes
that the decision maker is
perfectly rational while
deciding over a particular
course of action and
follows a logical and
systematic sequence of
actions. Simon's bounded
rationality model proposes
that decision makers
operate with a 'bounded'
rationality. Bounded
rationality is said to occur
when decision makers get
satisfied with a 'less-than-
ideal' solution to a
particular problem. The
judgmental heuristics and
biases model takes the
bounded rationality model a
step ahead by clearly
identifying the cognitive
biases of the decision
maker that influence his
decisions. This model
identifies three biases -
the availability,
representative and the
anchoring and adjustment
heuristics.
Finally the social model, in
contrast to the economic
rationality model, states
that human feelings and
emotions, by and large,
affect the decisions made
by the decision maker.
Behaviorally oriented
decision making techniques
emphasize the importance
of employee participation in
the process of decision
making. Increased
employee participation
leads not only to better
understanding of the
decision making situation
but also helps identify a
wider range of alternatives
for the problem on hand.
Besides, increased
employee participation in
decision making results in
increasing employee
productivity and job
satisfaction, apart from
reducing employee
turnover.
The Scanlon Plan is one of
the most important
traditional participative
techniques of decision
making. It involves creation
of formal committees to
encourage labor
participation in the decision
making process.
Introduction of suggestion
boxes is another technique
of problem solving. On the
other hand, quality circles
and self-managed teams
are examples of modern
participative techniques of
decision making.
Organizations, of late,
have realized the
importance of creativity in
the process of decision
making. Individuals or
organizations are said to
be creative when they not
only identify the problem
accurately but also
possess the ability of
generating innovative
alternatives to the given
problem solving situation.
Two major dimensions of
creativity are divergent
thinking and cognitive
complexity. Divergent
thinking refers to 'out-of-
box' or innovative
thinking. Cognitive
complexity describes the
extent to which an
individual uses elaborate,
intricate and complex
stimuli towards solving
philosophical or abstract
problems. These two
dimensions affect the
degree of creativity among
different individuals.
Decision making in a group
involves two phenomena -
group polarization and
groupthink. Group
polarization refers to the
shift of employee attitude
towards a more extreme
and reinforced state after
a discussion within the
group, than was the state
before the discussion.
Groupthink, on the other
hand, happens when the
group decides upon a
course of action which is
accepted by a majority of
its members, even before
actually discovering all the
alternative solutions to the
problem.
The most common forms of
group problem solving are
brainstorming, nominal
group technique and the
Delphi technique.
Brainstorming aims at
generating all possible
alternatives to a given
problem without actually
attempting to evaluate or
assess these alternatives.
The nominal group
technique involves
employee participation in
problem solving, without
the need for any verbal or
physical interaction among
the members. The nominal
group technique nullifies
the dysfunctional effects of
group decision making.
The Delphi technique is
similar to the nominal group
technique with a difference
that in Delphi technique,
the participants do not
actually meet at a common
place. Instead, these
members are informed
about the problem through
mails and are requested to
post their opinions about
the problem on hand.
Depending upon the
decision making situation,
managers employ any of
the problem solving
techniques.