Leadership, Positive

Organizational Behavior,
and Psychological Capital
MODULE 7

Leadership, Its Related Theories, and Concepts

● Leadership is often defined as a process wherein individual influences and
encourages others to achieve the organizational goals objectives and manage
the organization so that it becomes more coherent and cohesive to work.

● Leadership is all about making and helping people to reach their maximum
potential and motivating them to reach a common goal.
○ Commitment towards the tasks and duties allocated.
○ Ability to communicate well, taking ownership of the tasks.
○ Honesty and integrity.
○ Ability to make the right decisions and that too at the right time.
○ Creativity and innovation.
○ Ability to inspire others.
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Trait Approaches to Leadership

● The trait theory by Ralph M. Stogdill proposed this theory of leadership in the late
1940s; he explained that an individual must possess the key personality traits
and characteristics to be an effective leader and these traits are inherent by birth.
○ Psychological traits: height, weight, structure, color, appearance, and so
forth.
○ socioeconomic characteristics: gender, religion, marital status, age,
occupation, literacy, and earnings.
○ Personality traits: extraversion, self-confidence, patience, agreeable,
reliability, honesty, and leadership motivation.
○ Task-related traits: attainment drive, dedication, initiative, determination,
and business expertise.
○ Some of the other traits are charisma, adaptiveness, creativity,
uniqueness.

Intelligence
● General mental ability, g, id often called IQ in everyday language.
● People who have high mental abilities are more likely to be viewed as leaders in
their environment. They tend to have high emotional intelligence too. They
demonstrate a high level of self-awareness, motivation, empathy, and social
skills.
1. Openness- openness to experience

Describes a person’s degree of intellectual curiosity, creativity, and

preference for novelty and variety.

2. Conscientiousness

It is a tendency to show self-discipline, act dutifully, and aim for

achievement. It also refers to planning, organization, and dependability.

3. Extraversion
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It describes energy, positive emotions, assertiveness, sociability,

talkativeness, and the tendency to seek stimulation in the company of
others.

4. Agreeableness

It is the tendency to be compassionate and coopers towards others rather

than suspicious and antagonistic.

5. Neuroticism

It describes vulnerability to unpleasant emotions like anger, anxiety,

depression, or vulnerability.

Self-Esteem
● The degree to which people are at peace with themselves and have an overall
positive assessment of their self-worth and capabilities seems to be relevant to
whether they will be viewed as a leader.

Integrity
● Leaders whose integrity is questioned lose their trustworthiness, and they hurt
their company’s business along the way.

Behavioral Approaches to Leadership

1. Explain the behaviors that are associated with leadership.
2. Identify the three alternative decision-making styles leaders use and the
conditions under which they are more effective.
3. Discuss the limitations of behavioral approaches to leadership.
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Leader Behaviors
Researches at Ohio State University of Michigan led to the discovery of two broad
categories of behaviors:

1. Task-oriented leader behaviors involve structuring the roles of

subordinates, providing them with instructions, and behaving in ways that
will increase the performance of the group.
2. People-oriented leader behaviors include showing concern for employee
feelings and treating employees with respect.

Contemporary Approaches to Leadership

1. Learn about the difference between transformational and transactional leaders.
2. Find out about charismatic leadership and how it relates to leader performance.
3. Describe how high-quality leader-subordinate relationships develop.
4. Define servant leadership and evaluate its potential for leadership effectiveness.
5. Define authentic leadership and evaluate its potential for leadership
effectiveness.

Transformational and Transactional Leadership

● Employees working for transformational leaders do not focus on themselves but
rather the company’s well-being comes first.
● Transactional leadership, also known as managerial leadership, focuses on the
role of supervision, organization, and group performance. This style of leadership
uses rewards and punishment contingent on the performance of their
subordinates. It gives importance to rules, procedure, policies, and standards.
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Leader-Member Exchange Theory

● Proposes that the type of relationship leaders have with their followers is the key
to understanding how leaders influence employees.

Authentic Leadership
● Embraces the value of its key advice is “be yourself”. We all have different
backgrounds, different life experiences, and different role models.

Servant Leadership
● Defines the leader’s role as serving the needs of others. The primary mission of
the leader is to develop employees and help them reach their goals.

Contingency Approaches to Leadership

1. Learn about the major situational conditions that determine the effectiveness of
different leadership styles.
2. Identify the conditions under which highly task-oriented and highly
people-oriented leaders can be successful based on Fiedler’s contingency theory.
3. Discuss the main premises of the Path-Goal theory of leadership.
4. Describe a method by which leaders can decide how democratic or authoritarian
their decision making should be.

Fiedler’s Contingency Theory

● Developed by Frederick Fiedler.
● A leader’s style is measured by a scale called Least Preferred Coworker (LPC)
scale.
● The theory predicts that in favorable and unfavorable situations, a low LPC leader
– one who has feelings of dislike for coworkers who are difficult to work with –
would be successful.
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● When situational favorableness is medium, a high LPC leader— one who is able
to personally like coworkers who are difficult to work with—- is more likely to
succeed.

Path-Goal Theory of Leadership

● Robert House
● It is based on the expectancy theory of motivation.
● Expectancy theory of motivation suggests that employees are motivated when
they believe—or expect—that (1) their effort will lead to high performance, (2)
their high performance will be rewarded, and (3) the rewards they will receive are
valuable to them.
● The leader’s main job is to make sure that all three of these conditions exist.

FOUR LEADERSHIP STYLES

1. Directive leaders provide specific directions to their employees. Directive
leadership is also thought to be less effective when employees have high levels
of ability.
2. Supportive leaders provide emotional support to employees. Supportive
leadership is predicted to be effective when employees are under a lot of stress
or when they are performing boring and repetitive tasks.
3. Participative leaders make sure that employees are involved in making important
decisions. Participative leadership may be more effective when employees have
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high levels of ability and when decisions to be made are personally relevant to
them.
4. Achievement-oriented leaders set goals for employees and encourage them to
reach their goals. This style is likely to be effective when employees have both
high levels of ability and high levels of achievement motivation.

Vroom and Yetton’s Normative Decision Model

● This is a model for decision-making that’s based on situational leadership.
● It helps to choose the right style by having the user answer a series of questions
with either yes or no.
● Victor Vroom and Philip Yetton in 1973
● Expanded 15 years later by supplementations from Arthur Jago.

THREE IMPORTANT FACTORS IN DECISION MAKING

1. The quality of the decision to be taken is about how much impact the decision
will have and how important it is to find the right solution.
2. Involvement and collaboration concern the question of how important it is that
everyone agrees to the decision in a team.
3. Time constraints. If there’s a lot of time, there are more options to involve more
team players in the decision process.

FIVE DECISION-MAKING STYLES

● Autocratic (A1)
○ The leader uses the available information to make a decision
independently.

● Autocratic (A2)
○ The leader independently makes the decision, but the difference with
autocratic style 1 is that the leader has a bit more time and gathers
information from team members or external parties.
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● Consultative 1 (C1)
○ The leader adopts a consulting role and actively takes the lead to
have team members individually give their opinion about the
situation, the problem,
○
○ and the decision to be made. Here, the team’s involvement is
higher than in the autocratic decision-making style. However, the
decision is still made by the leader; he can choose to disregard the
team’s opinion and input when these haven’t changed his outlook
on the situation.
● Consultative 2 (C2)
○ Where the leader requests the individual opinions from the team
members in the first consulting style, he brings the team together in
a group meeting for a discussion in the second. Ideas and
suggestions are asked for in this meeting. Here, the leader shares
the problem and the situation with the group, but eventually, the
leader is still the one to individually make the decision.
● Group II (G2)
○ The group as a whole makes the decision. The leader presents the
situation and the problem to the group, identifies alternatives, and
makes a consensus decision. The leader purely plays the role of
facilitator and accepts the decision of the group without
considering his own opinion or vision.

The Trait Theory

● Ralph M. Stogdill (1940)
● An individual must possess key personality traits and characteristics to be an
effective leader and these traits are inherent by birth.
○ Physiological traits: Height, weight, structure, color, appearance, and so forth.
○ Socioeconomic characteristics: Gender, religion, marital status, age, occupation,
literacy, and earnings.
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○ Personality traits: Extraversion, self-confidence, patience, agreeable, reliability,

honesty, and leadership motivation.
○ Intellectual traits: Decisiveness, intelligence, judgemental ability, knowledge, and
emotional attribute.
○ Task-related traits: Attainment drive, dedication, initiative, determination, and
business expertise.
○ Social characteristics: Socially active, cordiality and cooperation.

Behavioral Theory
● Evolved in the 1950s.
● Ohio State Leadership Studies
○ Consideration: The friendly leaders are attentive and supportive to the
concerns of their subordinates and create an excellent relationship with
them. This was termed as ‘people-oriented behavior’.
○ Initiating structure: The leaders are mostly concerned with achieving
goals and following schedule and work structure. For such leaders,
subordinates are just mere resources that must be utilized through
performance. This was termed as ‘task-oriented behavior’.
● University of Michigan
○ Support
○ Goal emphasis
○ Work facilitation
○ Interaction facilitation

Transformational Leadership Theory

● To be an effective leader one must be able to transform or change perceptions,
behavior, and expectations of their followers, and guide them towards a common
goal to accomplish the leader’s vision
○ Psychological transformation: Bring about a change in the perception and
mindset of the follower.
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○ Influential: Creates a strong impact on the followers.

○ Motivational: Generates positive energy within followers.
○ Inspirational: Encourages them to achieve something.● Individual impact:
Creates a powerful effect on the behavior and perception of the followers.

Leadership Styles
● Leadership style is the relatively consistent manner and approach of providing direction,

implementing plans, and motivating people. As seen by the employees, it includes the total

a pattern of explicit and implicit actions performed by their leader (Newstrom, Davis, 1993).

● The first major study of leadership styles was performed in 1939 by Kurt Lewin who led a

group of researchers to identify different styles of leadership (Lewin, Lippit, White, 1939). This

early study has remained quite influential as it established the three major leadership styles:

(U.S. Army, 1973):

○ Authoritarian or Autocratic - the leader tells his or her employees the tasks to be done

and the manner of doing it, without getting their advice or feedback; though this style

may sound quite “bossy”, such is suitable during situations where the leader have all

relevant information to solve the problem and employees are well-motivated, but there is

only limited time.

○ Participative or Democratic - the leader allows one or more employees to join in the

the decision-making process, but the leader normally maintains the authority to make final

decisions; this leadership style promotes empowerment among diversified members

○ Delegative or Laissez-faire (free-rein) - the leader allows the employees to make the

decisions, however, the leader is still responsible for the decisions that are made; this is

an ideal style to be used if the leader has great trust and confidence in his people

Although good leaders use all three styles, with one of them normally dominant, bad
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leaders tend to stick with one style, normally autocratic.

Definition of Positive Organizational Behavior

● The study and application of positively oriented human resource strengths ans
psychological capacities that can be measured, developed, and effectively
managed for performance improvement in today’s workplace (Luthans, 2010).
○ Self-Efficacy is an individual’s confidence in their ability to attain a certain
goal in a specific situation.
○ Optimism is a positive mental attitude that reflects one’s belief that the
outcome will be favorable.
○ Hope is a positive motivational state where successful feelings of agency
and pathways interact.
○ Resiliency is a positive way of coping with adversity or distress. It is
defined as an ability to recover from stress, conflict, failure, change, or
increase in responsibility.

Definition, Components and Effects of Psychological

Capital
● An individual’s positive psychological state of development that is characterized
by having confidence (self-efficacy) to take on and put in the necessary effort to
succeed at challenging tasks; making a positive attribution (optimism) about
succeeding now and in the future; persevering toward goals and, when necessary,
redirecting paths to goals (hope) in order to succeed ; and when beset by
problems and adversity, sustaining and bouncing back and even beyond
(resiliency) to attain success.

Other Positive Constructs

● Gratitude, wisdom, courage, forgiveness, and even spirituality are some of the
other constructs. The two positive constructs that have had the most attention
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and are especially applicable to the workplace, would be happiness or subjective

well-being (SWB) and emotional intelligence (EI).

Happiness or Subjective Well-Being (SWB)

● People’s attractive and cognitive evaluations of their lives. Under this
psychological meaning, we may determine one’s happiness or subjective
well-being through understanding how they emotionally interpret and cognitively
process what happens to them.

Role of Intelligence
● Intelligence has bben regarded to be fixed at birth and it has been largely used
ass a predictor of school, job, and life success. In recent years nurture versus
nature debates have been renewed on intelligence and there has been some
recognition of multiple intelligences.

Emotional Intelligence
● EI has not yett met the criteria of POB that is why has not yet been a major part of
the latter. The major reaaspn for such is due to the limited research support for a
valid measure of EI and its relationship with performance outcomes. The synergy
created by combining emotion and intelligence becomes a potentially powerful
positively oriented construct for understanding and application to the study and
application of organizationalbehavior.
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