You are on page 1of 13

Leadership

Clearly, the personal styles of superb leaders vary. Some are loud and extraverted, whereas others may be subdued and analytical. According to Daniel Goleman (1998), all leaders have a high degree of emotional intelligence. He accepts that IQ and technical skills are important, but stresses the need for leaders to have this additional factor if they are to succeed. His research highlighted how cognitive skills such as big picture thinking and long term vision were vital ingredients for effective leadership, however the third element of emotional intelligence was more important as the person moved further up the hierarchy within the organisation. The five elements of emotional intelligence that he defined were self awareness, self regulation, motivation, empathy and social skill. Therefore, a leader needs to consider his/her strengths and personal style in each of these core areas in order to understand their own level of emotional intelligence as well as that of others.

Weiss (2003) in an analysis of the foundations of effective leadership, outlined how leaders show energy, generate ideas, respond to others, and take command of situations in which co ordination is critical. Clearly, from a first impression of a leader, his/her energy and emphasis on not only the generation of ideas, but on developing a thinking culture within the organisation are essential elements of a successful style. A good question which a leader might ask him/herself is Why would anyone want to be led by me? By really taking a hard look at this question, some home truths about the style of leadership being exercised may become clear to the leader. Leadership is more than a position. Those working in todays organisations look for and expect so much more.

When describing a leaders style as being either transformational or transactional, it is firstly worth looking at what both leadership approaches include. Transactional leadership is defined as a style where the leader acts as a change agent, making meaningful exchanges with employees, which result in improvements in productivity (Burns, 1997). Transformational leadership on the other hand, is a style of leadership in which the leader empowers workers to achieve an articulated vision of the

organisation, leading to increases in productivity, employee morale, and job satisfaction as well as greater personal and professional growth (Mc Daniel, C., Wolf, G.A. 1992).

One of the difficulties with this transformational style of leadership is ensuring it is passed down throughout the whole organisation. The research by Bass (1998) cited evidence from a range of studies across the world, that transformational leadership has a strong positive relationship with a range of measures such as productivity, job satisfaction, commitment and lower levels of stress. Therefore, there is a need to invest seriously in the development of personal and management skills among those working in leadership roles within the organisation as this is a core element of the success of the business.

Many researchers in the area of transformational leadership have used the Multi Factor leadership Questionnaire (MLQ, Bass and Avolio, 1990) to assess the style of leadership shown. The areas covered by this model provides a useful framework for the leader to assess and evaluate his/her own particular strengths in the area of leadership. The four transformational elements include idealised influence, which results in the leader being respected and trusted. The second element of the MLQ is that of inspirational motivation that is something that gets people to achieve more than they would for themselves. The third element of the MLQ is intellectual stimulation, whereby leaders encourage followers to question assumptions and approach old solutions in new ways. Finally, the fourth transformational element of the MLQ is that of individualised consideration. This is probably the most obvious one of the four elements as it refers to the need to listen to people, paying attention to each followers needs and desires. A vital consideration is that people will follow a leader provided they can see what is in it for me. Leaders need to walk around and talk to the people they lead, and in this way encourage new ideas, innovation and motivation among staff.

Leaders also need to pass leadership to others in the group or modify their approach and became more task focused when involved in tough negotiations or when the business needs that approach. This is similar to the situational or contingency approaches to leadership (Behling and Mc Fillen, 1996). This model stresses the need

for effective leaders to change and adapt their normal style depending on the needs of the business at a particular time, while considering the demands of a particular situation or circumstance. This approach stresses that there is no single best way to lead; instead the leaders style is dependent on the situation. The developmental level of those being led has an enormous impact on the style selected as their maturity determines whether the leader needs to be more task or relationship focused. As part of this flexibility, leaders need to put their own necks on the line and to stand up for what they believe is right for the business and the future. They owe this not only to themselves, but also to the people they manage. I believe personal risk is a core part of the success of every leader. This ability to take risks is something that differentiates leaders from followers. The charismatic leader creates an environment where individuals feel safe enough to take a risk and where organisational reward systems encourage people to innovate and try new things.

When considering if leadership is something which is inherent, the trait approach described by Weber (1963) outlined how the leader was born with certain core traits, including that of charisma. The great man argument characterises the trait oriented approach, a theme which dominated the literature until the late 1940s. This theory proposes that the leader has certain personal characteristics thatdistinguishes him/her as a leader. Empirical leadership research began with the search for traits that differentiated leaders from their followers (Judge, Bono, Ilies, and Gerhardt, 2002). However, following the publication of two reviews on leadership (Stogdill, (1948) and Mann (1959), the trait approach to leadership was virtually abandoned as both reviews found that personality does not predict leadership style. These reviews instead outlined how organisational context were key determinants in which personality factors were important for success.

When considering leadership in 2004, a Wall Street Journal Gallup poll (Culpan, 1987) of 782 CEOs from the largest corporations in the U.S. reported the following strengths and weaknesses of leaders:

Strengths Integrity

Ability to get along with others Industriousness Intelligence Business knowledge Leadership Education

Weaknesses Limited point of view Inability to understand others Inability to work with others Indecisiveness Lack of initiative Failure to take responsibility Lack of integrity

Therefore, it appears that many of the traits of an effective leader are based on core personal traits and behaviours, together with skills in how to relate with others. Leaders need to be aware of the areas they are strong in as well as those where they need to develop or to work with someone who will complement their style.

Bennis (1982) on the other hand, has identified the following five traits of super leaders based on interview data. These are:

Vision Communication Persistence Empowerment Organisational ability

If you trust people, then they will grow, develop and really perform. People must believe you will treat them fairly. There has to be a high degree of trust in the way they are managed. I believe treating people fairly is central to the success of any

organisation. There has to be a human element to the business and people need to feel valued for the job they do as well as the people they are.

Conclusion In this climate of change, leadership is viewed by many as the key to organisational success. Todays leaders need to become more adaptable, making sense of uncertainty and managing change. Leaders of the future need to be able to adapt their style to the situation and context, ensuring the results needed are achieved. The qualities of self - awareness, empathy, trust, drive and emotional intelligence are coming to the fore. In addition to coping with environmental challenges, the personalities and behaviours of leaders will determine their degree of achievement. As expectations rise, leaders in the future will increasingly have to win the right to lead others.

References Bass, B.M. (1998). Current developments in transformational leadership. Research and applications. Invited address to the American Psychological Association, San Francisco, August. Bass, B.M. and Avolio, B.J. (1990). Multifactor leadership questionnaire. Palo Alto, C.A. Consulting Psychologists Press. Behling, O. and Mc Fillen, J.M. (1996). A syncretical model of charismatic/transformational leadership. Group and Organisation Management, Vol 21 (2), pp 163-191. Bennis, W. (1982). Avalance Journal, Lubbock, Texas. November 19. Burns, J.M. Leadership. New York : Harper and Row ; 1978. Callan, S. (2003).Charismatic leadership in contemporary management debates.Journal of General Management. Vol 29. No. 1. Autumn. Culpan, R. (1987). Leadership styles and human resource management.JEIT, 11, 8. Goleman, D. (1998). What makes a leader? Harvard Business Review, November December. Ps 93-102. Mc Daniel, C. and Wolf, G.A. (1992). Transformational leadership in nursing science: a test of theory. Journla of Nursing Administration. 22 : 60-65. OConnor, F. (2004). Intel, Beating heart of the celtic tiger. Business and Finance, October 21st, ps 22-27..

Weber, M. (1947). The theory of social and economic organisation, New York : Oxford University Press, 1947. Weiss, W. H. (2003). Effective leadership : what are the requisites? Supervision. 61 : 3-6.

Part 2 Leadership in Action Richard Branson


Never let facts get in the way of a good idea Richard Branson

Richard Branson is a well known entrepreneur. Some words commonly associated with him include creative, fun, anti establishment, fast moving, opportunist, adventurer, risk taker, warm, friendly, competitive, workaholic and tough negotiator. Richard Branson wears colourful jumpers, dropped out of school at 16 to start his first business, and was a millionaire by the age of 24. He likes dangerous stunts, flying around the world in a balloon, breaking world records and PR stunts of any type. But for all this, he is an entrepreneur whose timing is renowned. He is the ultimate brand builder. Through his company, he has created a unique business phenomenon. He is the driving force at the centre of between 150-200 companies, employing more than 8,000 people in 26 countries. He began his business with a unique, multi university student magazine and a small mail order record company in 1970. This humble beginning was the catalyst for the creation of Virgin Records. Twenty two years later, he sold Virgin Music Group to Thorn EMI. Branson has started over 200 businesses, which have expanded into 23 countries, ranging from planes, to drinks, to investment funds; growing his label to be a $3.5 billion company. In his own words, though their growth has been rapid, it is based on developing good ideas through excellent management principles. Branson believes in keeping things simple and that people are the foundations of the corporations success. He clearly had a story for what he wanted Virgin to become and the unique way he wanted to achieve this was embodied in who he was and how he behaved. How did he get to be where he is today? What particular leadership style does he have? What are the lessons in leadership that can be attributed to the growth of Richard Bransons empire?

Firstly, what do we mean when we use the term leadership? According to Daft (2002), leadership involves influence, it occurs among people, those people intentionally desire significant changes, and the changes reflect purposes shared by leaders and followers. In looking at Bransons approach, his skills as an influencer and ability to create a common purpose among his followers are renowned. There are many different approaches to the explanation of a persons leadership style, with many leaders using a combination of styles, depending on the situation they are in or the people they are dealing with. Bransons core values and beliefs include helping people to achieve things they did not know they were capable of as well as being a catalyst for the success of others, while constantly learning as he went along. Clearly, when looking at Bransons history, there seems to be a complex number of different facets to his approach and personality as well as a range of different leadership styles and drivers which can be seen. However, having identified this, there are also a number of key themes and one leadership model in particular, which he focused on.

When looking at the growth of the Virgin empire and the style of leadership demonstrated by its CEO, a number of trends emerge. These include the following:

Survival through adversity and set backs. Tremendous self belief and determination to succeed. His recognition of his own particular strengths as a leader was clear early on as he built a team around him of those who were not like him, but who complemented his areas of weakness. His sense of ethics and moral responsibility to his staff, equity and fairness in how he dealt with people and investors. His loyalty to people and interpersonal skills are evident in many places as is on the other hand, his ruthlessness and tough negotiating stance.

These are just some of the themes that emerge in terms of the Branson way of doing business. One thing that is clear, is that the culture which Branson created through his own unique leadership style, was one that is strongly influenced by his personal style and personality, making it a difficult model to adopt or mimic if he was to leave. Therefore, when considering his leadership style and success, in addition to his

failings as a leader, the traits approach to leadership is one that is critical. Applying this theory to Branson, there are examples where he does change his style and approach according to the context. For example, although not a natural trait in him as he was not very sociable in school, he made himself the face of Virgin; getting involved in outrageous publicity stunts to gain attention. He is remarkably reserved and shy in person, yet he is a man who has built a worldwide image out of publicity and performing for TV cameras (Fox, 2004). Another example was his use of diplomatic skills, something that would not have been a core part of his personality, but as the situation required, when lobbying government to ensure a price war did not put Virgin out of business, he adapted his approach to reach his goal in this context. So, although the word charismatic is often associated with Branson, whether this is a learned behaviour or a core element of his personality is not clear.

One thing is certainly clear when looking at Bransons approach; he becomes who he needs to be depending on the situation. He is flexible in how he appears to the public, his staff and his shareholders, all being primarily driven by his goal focused approach to success and growing the business. Therefore, it seems that although personality and traits may be core, it is the context and the needs of the business that seem to be more prevalent drivers of behaviour in the case of Richard Bransons style.

A key area of success for Branson was the selection of his top management team, something he was prepared to change as the context and needs of the business changed. He recognised the need to have a team that would complement his own particular strengths as well as providing for his weaknesses as a leader. He selected his senior team at times when the business needed the expertise each one could offer, something he was prepared to change when they were no longer adding value in the way the business needed..

Recent research has shown that top management teams can have a profound impact on the strategic direction and performance of the organisation (Zaccaro, 2001). The top management teams characteristics include their composition, structure, incentives and processes (Hambrick, 1994). The incentives provided by Branson seemed to be in terms of offering senior staff more autonomy and trust once the business was established, giving them a shareholding in the success of the new venture.

There is growing evidence to support the idea that group dynamics are directly related to firm performance. When top teams are careful in their decision making, being careful to weigh up all the risks and to prepare a contingency plan in case things do not go according to plan, they are more likely to succeed (Janis and Mann, 1992). This approach to risk and contingency seemed to be evident in the Branson approach to leadership, so in considering his leadership style, it is also worthwhile to consider the compilation and dynamics of his top team. Janis and Mann (1992) also went on to find that leaders of top teams are open to challenge and criticism. Research has shown that the CEOs personality affects the top management teams group dynamics and that this in turn is related to organisational performance (Peterson, Smith, Martona and Owens, 2003). Clearly Bransons dominant style and ultimate autonomy in decision making around strategy must have had an impact on the dynamics of his team. However, in many decisions, it seems that he did bring his team along with him and in many instances, he seemed to follow their advice eg. in choosing the path of attracting unknown artists to the Virgin label.

According to Mintzberg (2004), you earn leadership from those you lead. He suggests that leadership is about gaining the respect of those who work for you, something which Branson seemed to do a lot in his career. Much of the ways in which he did this seemed to stem from his sense of fairness and equality in how he dealt with people, encouraging a flat, non hierarchical structure to run his businesses. The early 1980s saw a major paradigm shift in approaches to leadership, from transactional to transformational. Earlier approaches to leadership, such as the contingency models of Fiedler (1967), Vroom and Yetton (1973), and Yukl (1989), focused on identifying the styles which predicted effective outcomes depending on situational contingencies. However, they did not help to offer any advice when leading in an environment or organisation where constant change was the norm. This is when the charismatic or transformational models began to emerge (Bryman, 1992) which included ideas such as visionary and charismatic in their notion of what leadership meant. It is the transformational approach that in my view, best summarises the style of this renowned business leader.

As is often the case with these inspirational type leaders, the tiers below them are filled with those who may be less charismatic, but who have the necessary organisational and management skills to ensure the success of the organisation. Transformational leaders are often equated with those who can adapt quickly to change (Bass, 1985). Branson clearly showed his flexibility and success in adapting to changing organisational cultures as he bought new businesses and moved into new sectors, bringing his people with him. The literature shows that ratings of transformational leadership were positively correlated with supervisory evaluations of managerial performance (Hater and Bass, 1988), recommendations for promotion (Waldman, Bass and Yammarino, 1990) and percentage of goals achieved in strategic business units (Howell and Avolio, 1993). Also, research by Patterson, Fuller, Kester and Stringer (1995) have confirmed the positive relationship between transformational leadership and performance. Bass (1985) argued that transformational leadership is more likely to reflect social values and to emerge in times of distress and change, whereas transactional leadership is more likely to be observed in a well ordered, steady environment. Virgin is an organisation that is centred on continual growth and change, therefore making the transformational style more suitable. An example of how he demonstrated this charismatic and personal approach was when he gave employees in his airline his personal phone number and encouraged them to give him their ideas and suggestions for improvements by talking to him directly.

Transformational leadership theory suggests that this style of leadership is likely to result in growth and empowerment among followers (Bass, 1985). However, this style may also cause a dependency among followers on the leader (Howell, 1988). Psychologically, this implies the followers motivation and self esteem are dependent on positive feedback and recognition from the leader. The Virgin empire is one where the individual personality of Branson is stamped everywhere throughout the business, therefore, his values and goals are those which drive and permeate every element of the corporation. A review of transformational and charismatic leadership theories suggests that such leaders may achieve their impact by the creation of followers who personally identify with this style as well as with the work group they are with (Yukl, 1988). This personal identification with the leaders is due to his/her charismatic approach (Conger and Kanungo, 1998) and is based on referent power.

Similarly, Shamir, House and Arthur (1993) suggested that role modelling was one major way leaders influence followers.

Another element of the Virgin story worth highlighting is that of social identification. When individuals identify with a group, they base their self concept and self esteem partly on their belonging to that group, with group successes and failures being experienced as personal to the individual (Mael and Ashforth, (1992). The leader influences their followers to identify with the group goals and values (Shamir, 1993) by connecting the followers self concept to the mission of the organisation and goals of the group.

As part of the way in which Branson got his follower to identify with the organisation and himself, he seemed very able to manage the mood of his organisation. He seems self aware and empathetic, while intuitively grasping how others feel and gauging the organisations emotional state. According to Mayer (2004), emotional intelligence is the ability to accurately perceive your own and others emotions. He describes how emotional intelligence is one of the core ways of becoming a successful leader, something that Branson also demonstrates in how he reads himself and others.

Finally, perhaps one of the other strongest themes in Bransons leadership style is his dogged determination to reach his goals, regardless of any obstacle that may have been in his path. According to Zaleznik (2004), leaders think about goals differently to managers. They are active rather than reactive. The influence a leader exerts in altering moods, evoking images and expectations, and in establishing specific desires and objectives determines the direction the business takes. The net result of this influence changes how others think about what is possible or desirable in terms of goals. Therefore, the leader instils some of his/her passion for a particular goal on those he/she leads. It was Bransons relentless shaping of the goals for his organisation and then instilling some of this desire to achieve in those he hired, that helped Virgins continued growth and success, despite any negative external circumstances.

In conclusion, Bransons charismatic style of leadership is one that stems from a largely transformational approach to how he influences those in his organisation. He

shows clear skills in his ability to read the emotions of others and to assess the mood of his own culture, while having tremendous skills in how he can adapt his style and approach to the particular situation or context he is in. His drive and determination to succeed has been a key element of his success, something that stems from a combination of genetics and family circumstances. His success in becoming and remaining an effective leader of Virgin is largely due to his willingness and ability to empower individuals within the organisation. Branson has shown sensitivity to the needs of others, such as the need for recognition, growth and achievement. Through his attention to and encouragement of ideas and initiatives, Branson has gotten the support of his subordinates. His authority at Virgin is extended by his flamboyant and charismatic personality and attention grabbing behaviour, both of which increased his visibility and appeal to staff and the public. Although unique to Branson himself, this style of leadership is one that works very well within the Virgin empire.

References: Avolio, B.J., Bass, B.M. and Jung ,D.I. (1999). Re examining the components of transformational and transactional leadership using the multifactor component questionnaire. Journal of Occupational and Organisational Psychology, 72, 441-462. Bass, B.M. (1985), Leadership and performance beyond expectation. New York : Free Press. Conger, J.A. and Kanungo, R.N. (1998).The empowerment process: integrating theory and practice. Academy of Management Review, 3, 471-82. Daft, R.L. (2002). The Leadership Experience. (2nd Ed). Eisenhardt, K.M, and Zbaracki, M.J.(1992).Strategic decision making. Strategic Management Journal, 13, 17-37. Fiedler, F.E. (1967). A theory of leadership effectiveness. New York. Mc Graw Hill. Fox, Catherine. (2004). The Reluctant Guru. Financial Review. Boss. Gasper, S. (1992). Transformational leadership. In integrative review of the literature. Doctoral dissertation, Western Michigan University. Howell, J.M. (1988).Two faces of charisma : socialised and personalised leadership in organisations. In J. A. Conger and R.N. Kanungo (Eds), Charismatic leadership, pp 213 266. San Francisco : Hossey Bass.

Janis, I.L and Mann, L.(1992). Cognitive complexity in international decision making. In P. Suedfeld and P.E.Tetlock (Eds), Psychology and social policy (pp 33-50). Washington DC: Hemisphere. Judge, T., Bono, J., Ilies, R., and Gerhardt, M. (2002).Personality and leadership : A quantitative and qualitative review. Journal of Applied Psychology, 87, 765-780. Mael, F. and Ashforth, B.E. (1992). Alumni and their alma matter : a partial test of the reformational model or organisational identification. Journal of Organisational Behaviour, 13, 103 123. Mann, R.D. (1959). A review of the relationship between personality and performance in small groups.Psychological Bulletin, 56, 241-270. Mayer, J.D. (2004). Leading by Feel. Harvard Business Review, January, 28-37. Mintzberg, H. (2004). Ideas about Management. Engaging leadership, Decision, Issue 5, 2004. Moynihan, L.M. and Peterson, R. S. (2001). A contingent configuration approach to understanding the role of personality in organisational groups. Research in Organisational Behaviour, 23 327-378. Peterson, R.S, Smith, D.B., Martorana, P.V. and Owens, P.D. (2003). The impact of CEO personality on top management team dynamics : one mechanism by which leadership affects organisational performance. Journal of Applied Psychology, Vol 88, No. 5, 795-808. Shamir, B., House, R.J., and Arthur, M. B. (1993). The motivational effects of charismatic leadership : a self concept based theory. Organisational Science, 4, 57793. Stogdill, R.M. (1948). Personal factors associated with leadership : A survey of the literature. Journal of Psychology, 25, 35-71. Vroom, V.H. and Yetton, P.N. (1973). Leadership and decision making. Pittsburgh, PA, University of Pittsburgh press. Yukl, G.A. (1989). Managerial Leadership. A review of theory and research. Journal of Management, 15, 251-289. Zaccaro, S. (2001). The nature of executive leadership. Washington, DC: American Psychological Association.