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Empowerment: An Ingredient in Modern Management  The process of giving workers at all levels more authority to make decisions and the responsibility for their outcomes.. Expectancy Theo

Fundamentals oF manaGement

BY: LAI VAN TAI

LAI VAN TAI

Chapter

LEADING

Learning Objectives

After studying the chapter, you should be able to:

 Describe what leadership is, when leaders are effective and

ineffective, and the sources of power that enable managers to be effective leaders.

 Characterize the relationship between gender leadership.

 Explain what motivation is and why managers need to be

concerned about it.

 Describe from the perspectives of expectancy theory and equity

theory what managers should do to have a highly motivated workforce.

 Explain how goals and needs motivate people and what kinds of

goals are especially likely to result in high performance.

Learning Objectives

After studying the chapter, you should be able to:

 Explain why effective communication helps an organization gain a

competitive advantage.

 Describe the communication process, and explain the role of

perception in communication.

 Define information richness, and describe the information richness

of communication media available to managers.

 Describe the communication networks that exist in groups and

teams.

The Nature of Leadership

 Leadership

 The process by which a person exerts influence over

others and inspires, motivates and directs their activities

to achieve group or organizational goals

 Effective leadership increases the firm’s ability to meet new

challenges.

 Leader

 An individual who is able to exert influence over other

people to help achieve group or organizational goals

The Nature of Leadership

 Personal Leadership Style

 The specific ways in which a manager chooses to

influence others shapes the way that manager approaches the other tasks of management

 Leaders may delegate and support subordinates, while others

are very authoritarian.

 The challenge is for managers at all levels to develop

an effective personal management style

Leadership Across Cultures

 Leadership styles may vary among different

countries or cultures.

 European managers tend to be more people-oriented

than American or Japanese managers

 Japanese managers are group-oriented, while U.S

managers focuses more on profitability

 Time horizons also are affected by cultures

 U.S firms often focus on short-run efforts and results.

 Japanese firms have a longer-run perspective.

 European firms fall somewhere between the U.S and

Japanese orientations.

Sources of Managerial Power

Power: The Key to Leadership

 Legitimate Power

 The authority that a manager has by virtue of his or her

position in the firm

 Example: the power to hire or fire employees.

 Reward Power

 The ability of a manager to give or withhold tangible

and intangible rewards

 Example: awarding pay raises or providing verbal praise for

good performance.

 Effective managers use reward power to signal to

employees that they are doing a good job

Power: The Key to Leadership (cont’d)

 Coercive Power

 The ability of a manager to punish others

 Examples: verbal reprimand, pay cuts, and dismissal

 Limited in effectiveness and application; can have serious

negative side effects.

 Expert Power

 Power that is based on special knowledge, skills, and

expertise that the leader possesses

 First-line and middle managers have the most expert power;

most often consists of technical ability.

Power: The Key to Leadership (cont’d)

 Referent Power

 Power that comes from subordinates’ and coworkers’

respect for the personal characteristics of a leader which earns their loyalty and admiration

 Usually held by and available for use by likable

managers who are concerned about their workers

Empowerment: An Ingredient in

Modern Management

 The process of giving workers at all levels more

authority to make decisions and the responsibility for their outcomes

 Empowerment helps managers:

 Get workers involved in the decisions.

 Increase worker commitment and motivation.

 Have time to focus on other issues.

 Effective managers usually empower

substantial authority to workers.

Gender and Leadership

 The number of women managers is rising but is

still relatively low in the top levels of

management.

 Stereotypes suggest women are supportive and

concerned with interpersonal relations Similarly, men are seen as task-focused

 Research indicates that actually there is no gender-based

difference in leadership effectiveness.

 Women are seen to be more participative than men because

they adopt the participative approach to overcome subordinate resistance to them as managers and they have better

interpersonal skills.

The Nature of Motivation

 Motivation

 The psychological forces acting on an individual that

determine:

 Direction—possible behaviors the individual could engage in

 Effort—how hard the individual will work

 Persistence—whether the individual will keep trying or give

up

 Explains why people behave the way they do in

organizations

Sources of Motivation

Nature of the Organization

Personal Characteristics Nature of the

Job

Individual Motivation

The Motivation Equation

Pay and Motivation

 Pay as a Motivator

 Expectancy: pay is an instrumentality (and outcome),

must be high for motivation to be high

 Need Theory: pay is used to satisfy many needs

 Equity Theory: pay is given in relation to inputs

 Goal Setting Theory: pay is linked to attainment of

goals

 Learning Theory: outcomes (pay), is distributed upon

performance of functional behaviors

Expectancy Theory

 Motivation will be high when workers believe:

 High levels of effort will lead to high performance

 High performance will lead to the attainment of desired

outcomes

 Major Factors of Motivation

 Expectancy—the belief that effort (input) will result in

a certain level of performance

 Instrumentality—the belief that performance results in

the attainment of outcomes

 Valence—how desirable each of the available

outcomes from the job is to a person

Expectancy, Instrumentality, and Valence

Expectancy Theory in Practice

 Expectancy: Effort will result in a level of performance

 Employees will work work hard if they believe they can attain

high performance—organizations must provide the resources that support performance.

 Instrumentality: Performance leads to outcomes

 Workers are only motivated if they think performance leads to

an outcome—managers must link performance to outcomes.

 Valence: How desirable an outcome is to a person

 Workers have preferences for outcomes—managers must

determine which outcomes are valued.

Theory X

Avoid Responsibility Little Ambition

Theory Y

Accept Responsibility

Self-Directed

Need Theories

 Need

 A requirement for survival and well-being

 Need Theories

 Theories of motivation that focus on what needs people

are trying to satisfy at work and what outcomes will satisfy those needs

 Basis premise is that people are motivated to obtain

outcomes at work to satisfy their needs

 Managers must determine what needs a worker wants satisfied

and ensure that a person receives the outcomes when performing well.

Maslow’s Hierarchy of Needs

Table 12.1

actualization

Self-Realize one’s full potential

interaction, love

Interpersonal relations, parties

Safety Security, stability Job security,

Needs Description Examples

Lower-level needs must be satisfied before higher-level needs are addressed.

Highest-level

needs

Lowest-level

needs

Hierarchy

of Needs

Self Esteem Social Safety Physiological

Source: Motivation and Personality, Second Edition, by A H Maslow, 1970 Reprinted

by permission of Prentice Hall, Inc., Upper Saddle River, New Jersey.

Alderfer’s ERG Theory

relations, feelings

Good relations, accurate feedback

clothing, and shelter

Adequate pay for necessities

Needs Description Examples

Highest-level

needs

Lowest-level

needs

Herzberg’s Motivation-Hygiene Theory

 Focuses on outcomes that lead to higher motivation and job

satisfaction, and those outcomes that can prevent

dissatisfaction

 Motivator needs relate to the nature of the work itself—autonomy,

responsibility, interesting work.

 Hygiene needs are related to the physical and psychological

context of the work—comfortable work environment, pay, job security.

hygiene needs does not lead to motivation or job satisfaction.

Adam’s Equity Theory

 Focuses on people’s perceptions of the fairness (or

lack of fairness) of their work outcomes in

proportion to their work inputs.

 A relative outcome to input ratio comparison to oneself

or to another person (referent) perceived as similar to oneself

 Equity exists when a person perceives that their

outcome/input ratio to be equal to the referent’s ratio

 If the referent receives more outcomes, they should also give

more inputs to achieve equity.

Equity Theory

Table 12.3

Condition Person Referent Example

Equity Outcomes Inputs Inputs = Outcomes

Worker contributes more inputs but also gets more outputs than referent

Goal Setting Theory

 Focuses on identifying the types of goals that are

effective in producing high levels of motivation and explaining why goals have these effects.

 Considers how managers can ensure that workers

focus their inputs in the direction of high

performance and the achievement of

organizational goals.

Goal Setting Theory (cont’d)

 What a person is trying to accomplish

 Characteristics of Motivating Goals

 Specific and not vague in providing direction

 Difficult but not impossible to attain

 Accepted and committed to by workers

 Feedback on goal attainment is important

 Goals point out what is important to the firm.

 Workers should be encouraged to develop action plans

to attain goals

Learning Theories

 Theories that focus on increasing motivation and

performance by linking outcomes to performance and the attainment of goals.

 Learning

 A relatively permanent change in person’s knowledge

or behavior that results from practice or experience

Additional Suggestions for Motivating Employees

Recognize individuals Match people to jobsUse goals

Make goals attainable

Further Suggestions for Motivating Employees

Individualize rewards Link rewards to performance Check the system for equity Don’t ignore money

Communication and Management

 Communication

 The sharing of information between two or more

individuals or groups to reach a common understanding

 Importance of Good Communication

 Increased efficiency in new technologies and skills

 Improved quality of products and services

 Increased responsiveness to customers

 More innovation through communication

 The encoding of messages by means of facial

expressions, body language, and styles of dress

Information Richness of Communication Media

Figure 15.2

The Communication Process

 Phases of the Communication Process:

 Transmission phase in which information is shared by

two or more people

 Feedback phase in which a common understanding is

assured

 The process starts with a sender (an individual or

group) who wants to share information.

 Senders must decide what information to share and puts

the message into symbols or language (encoding)

 Noise: anything harming the communication process.

The Communication Process

Figure 15.1

The Communication Process (cont’d)

 Messages are transmitted over a medium to a

receiver.

 Medium: the pathway over which the message is

transmitted (e.g., telephone, written note, email)

 Receiver: the person getting the message

 The receiver decodes (interprets) the message, allowing the

receiver to understand the message.

 This is a critical point: failure to properly decode the message

can lead to a misunderstanding.

 Feedback by receiver informs the sender that the

message is understood or that it must be re-sent

Organization Communication Networks

level.

grapevine is an informal network carrying unofficial information throughout the firm.

Formal and Informal Communication

Networks in An Organization

Figure 0.4

Communication Networks in Groups and

Teams

Communication Skills for Managers

 Barriers to Effective Communication

 Messages that are unclear, incomplete, difficult to understand

 Messages sent over the an inappropriate medium

 Messages with no provision for feedback

 Messages that are received but ignored

 Messages that are misunderstood

 Messages delivered through automated systems that lack the

human element

Communication Skills for Managers

 Managers as Senders

 Send clear and complete messages.

 Encode messages in symbols the receiver understands.

 Select a medium appropriate for the message and, importantly, one

that is monitored by the receiver.

 Avoid filtering (holding back information) and distortion as the

message passes through other workers.

 Ensure a feedback mechanism is included in the message.

 Provide accurate information to avoid rumors.

Communication Skills For Managers

 Managers as Receivers

 Pay attention to what is sent as a message.

 Be a good listener: don’t interrupt.

 Ask questions to clarify your understanding.

 Be empathetic: try to understand what the sender feels.

 Understand linguistic styles: different people speak differently.

 Speed, tone, pausing all impact communication.

and plan for this.