Organizational behavior & leadership styles Flashcards
Formal organization
- formal organizational structure refers to type of structured and planned structure that may be adopted by an organization
- roles are specifically defined
- detailed writing and leaving little room for interpretation
Informal organization
- is a social structure
- aggregate of norms, personal and professional connections which get work done
- relationships are built among people
- firms can react to illegality by ignore, tolerate and punish
- firms have to handle different informal political processes in their daily business
What is organizational culture?
- is a pattern of common assumptions and values which the group learned by solving the problems of external adaptation and internal integration.
- two different types of values:
• Output driven values
• Instrumental values
Organizational Culture: Definition
- Organizational Culture is the behavior of humans within an organization and the meaning that people attach to those behaviors
- 6 core elements
1. implicit phenomenon
2. practiced in the firm‘s daily routine
3. refers to common orientations, values, etc
4. is the outcome of an learning process
5. melt into a common „view of the world“ over the years
6. is mediated through a Process of Socialization, it is not an active learning process
Types of Culture
- “Tough-Guy Macho” Culture (Microsoft)
- “Work Hard, Play Hard” Culture (Google)
- “Bet Your Company” Culture (Tesla)
- “Process” Culture
Functions of Culture
- enhances stability
- conveys a sense of identity
- its boundary-defining
- shapes employees attitudes and behavior
Strong and Weak Cultures
- criteria to classify
• Conciseness
• Diffusion Rate
• Anchoring Depth
Organizational Cultures and Sub Cultures
- successful management leader creates subcultures
- without understanding the different levels of cultures that exist it may be difficult to implement a new strategy etc.
- 3 interacting levels of cultures:
1. strengthening subculture = main culture is affirmed
2. Neutral subculture = own systems exist but there is no conflict with main culture
3, Counter-culture = there is a pattern of orientation which directed against main culture
How Does an Organizational Culture Develop?
Development of an organizational culture depends on interaction of four factors:
- Ownership Structure
- Organizational Structure
- The Ethical Dimension of Culture
- Characteristics of Employees
the original culture derives from the founders philosophy; factors like characteristics of the employees, ethical dimensions, top managers actions contribute to the original culture
Culture creation (founders)
- occurs in 3 ways
1. Founder only hire/keep employees who think and feel the same way
2. Founder indoctrinates and socializes employees
3. Founders own behavior encourages employees
Convincing the Employees of the Organizational Culture
- Organizational Culture is closely connected with emotions so people feel attracted by firms because their personal values match with firm
- -> by hire a new employee is important that employees values are essentially with ones of organization
- adaption-process is called socialization (new employees learn values)
- in strong culture core values are intensely held and widely shared
–> Rituals express and reinforce key values of an organization; e.g. Transitional rituals (when individual is new) Integration ritual (to strengthen relationship e.g. barbecue parties) or improvement rituals (e.g, employee promotions/events for awards)
–> Ethnical work climate influences the way firm members feel they should behave
Ethnics in organizations
- values of a corporate culture influence the ethical standards within a corporation
- Ethics are the principles and values an individual uses to govern his activities and decisions.
- In an organization, a code of ethics is a set of principles that guide the organization in its programs, policies, and decisions for the business.
- Ethics take a long-term perspective and balance the rights of multiple stakeholders, including employees, shareholders, and the community.
- If the culture is strong and supports high ethical standards, it should also have a very powerful and positive influence on employee behavior.
What can Managers do to Create an Ethical Culture?
a. Be a visible role mode
b. Communicate ethical expectations
c. Provide ethical training
d. Visibly reward ethical acts & punish unethical ones
e. Provide protective mechanism
Corporate Social Responsibility
- can be Instrumental strategic acting - Interest-driven, targeted on success, the dominant type of coordination in a economy based on prices and competition
- or communication-oriented acting - Based on communication, this type of acting is excluded from the capitalist market economy
Strategy & Society: Link Competitive Advantage and CSR
Proponents of CSR have used four arguments to make their case: • moral obligation • sustainability • license to operate • reputation
Strategy & Society: The Process
- Creating a corporate social agenda: Prioritizing Social Issues
- Integrating inside-out and outside-in practices
- Creating a social dimension to the value proposition
- Organizing for CSR
(e.g. Nestle)
Leadership styles
- ability to influence a group toward the achievement of a vision or a set of goals
- Organizations need strong management and strong leadership for optimal effectiveness
Managing vs. Leading
- “Leaders manage and managers lead but the two activities are not synonymous”
- Managers typically perform functions associated with planning, investigating, organizing and controlling, while leaders deal with interpersonal aspects of a manager’s job
- Leaders inspire others, provide emotional support, and try to get employees to rally around a common goal.
Trait theories
- Traits are distinctive characteristics that distinguish leaders from non-leaders
- focus on personal qualities
1. Neuroticism (tendency to experience negative emotions)
2. Openness (general appreciation for art, emotion, adventure etc.)
3. Extraversion (includes characteristics like sociability, excitability (can be trained))
4. Conscientiousness (high level of thoughtfulness, good impulse control and goal directed behavior)
5. Agreeableness (attributes such as trust, kindness, etc (dependent on situations))
Behavioral theories
- imply one can train people to be leaders
- identifies behavioral differences between effective/ineffective leaders
Contingency theory
- leaders do not guarantee success, the context matters
1. Fiedler Model
2. Situational Theory
3. Path Goal Theory
4. Leader-participation model
Fiedler Model
- effective group performance depends on a proper match between a leader’s style or interacting with subordinates and the degree to which the situation gives control and influence to the leader
- leader’s effectiveness is based on the situation
- the result of two factors:
• leadership style
• situational favourableness
Evaluation is based on
• Leader-Member Relations
• Task Structure
• Leader’s Position Power
Situational Theory
- focuses on the follower
- successful leadership depends on selecting right leadership style contingent on followers readiness
- -> effective leadership varies; there is no single best style because its depending upon individual situation
Path Goal Theory
- leaders behavior should be contingent to satisfaction of subordinates
- leaders clarify
- remove obstacle
- increase rewards
Leader-participation model
- best style is contingent to the situation
- model is highly flexible with respect to choice a leader makes (dictatorial - democratic)
Charismatic leadership
Characterized by:
- Vision and articulation
- Personal Risk
- Sensitivity to follower need
- Unconventional behavior
–> Charismatic leaders are born and made is not only naturally (often)
Transactional and Transformational Leadership
- Transactional leaders: guide their followers toward established goals by clarifying role and task requirements
- Transformational leaders: Inspire followers to transcend their self-interests, can have an extraordinary effect on their followers
–> best leaders are both
Authentic Leadership
- know who they are, know what they believe in and value, and act based on those values and beliefs
- Trust is produced by leadership
- share information, encourage open communication, and stick to their ideals
- -> Result: develop faith in them
- creates a positive energizing effect
Ethical Leadership
- is leading by knowing and doing what is right (difficult to define)
- no universal standard for ethical behavior
New Approaches
–> Mentoring
- A mentor is a senior employee who sponsors and supports a less-experienced employee.
“Both/And” Leadership
- the goal of todays’ leadership is to maintain a dynamic equilibrium in the organization
- Senior teams build dynamic equilibrium by separating the imperatives that are in conflict with one another in order to recognize and respect each, while at the same time actively managing connections between them in order to leverage interdependencies and benefit from their synergies
- Mangers need to shift from either/or to both/and mindset
