The Organization as an Iceberg

Stewardship Theory
• Stewardship theory has its roots in psychology and
sociology and was designed for researchers to examine
situation in which executives as steward motivated to act in
the best interest on their principal (Donaldson & Davis,
1989, 1991).
• Stewardship theory is a theory that managers, will act as
responsible stewards of the assets they control. Stewardship
theorists assume that given a choice between self-serving
behavior and pro-organizational behavior, a steward will
place higher value on cooperation than defection. 
• Stewardship theorists argues that the performance
of the steward is affected by whether structure
situation in which he or she located facilitates
effect action.
• Given the advantage to the stewardship to
principals, why is not there is always steward
relationship, rather than an agency relationship.
• What factors that differentiate between stewardship
and agency theories.
 Early Approaches /
Theories of Leadership
In this approach, the researchers attempted to
identify specific traits and characteristics of
leaders. Many studies conducted from 1930
to 1960, attempts were made to correlate
certain traits and the rise of leadership.
Throughout history, strong leaders have
been described by their traits. Therefore,
leadership research has long sought to
identify the personality, social,  physical,
or intellectual attributes that differentiate
leaders from non-leaders.
 LEADER
Someone who can influence
others and
who has managerial
authority.
 LEADERSHIP
It is a process of influencing others
toward the achievement of goals.
Leadership is the process of unfolding
and channelizing human energies for
the worthwhile ends.
 Great Man Theory
• Leadership, in its earliest form, was centred on personalities
called ‘Great Men’, and hence the ‘Great Man Theory’.
Thomas Carlyle (1840), a writer and a teacher, is considered
as a pioneer of Great Man Theory through his book “On
Heroes, Hero Worship and the Heroic in History”, in which
he compared various legendry heroes and argued that the
actions of the “great man” play a key role in history,
claiming that ‘the history of the world is but the biography
of great men’. The theory professed that leadership traits
are intrinsic, therefore, leaders are born and people are
destined by birth to become a leader.
 Early Leadership Theories
Trait Theories (1920s-30s)
– Research focused on identifying personal characteristics that
differentiated leaders from non-leaders was unsuccessful.
– Trait theories help us predict leadership, but they don’t fully
help us explain leadership.
– Later research on the leadership process identified seven
traits associated with successful leadership:
• Drive, the desire to lead, honesty and integrity, self-confidence,
intelligence, job-relevant knowledge, and extraversion.
 Seven Traits Associated with Leadership

Source: S. A. Kirkpatrick and E. A. Locke, “Leadership: Do Traits Really Matter?” Academy of Management Executive, May 1991, pp. 48–60; T. A.
Judge, J. E. Bono, R. llies, and M. W. Gerhardt, “Personality and Leadership: A Qualitative and Quantitative Review,” Journal of Applied Psychology,
August 2002, pp. 765–780.
 Behavioral Dimension of Leadership
• Trait research provides a basis for selecting
the right people for leadership. Behavioral
theories of leadership, in contrast, imply we can
train people to be leaders.
• Leaderships theories that identify behavior
that differentiate from ineffective leaders. The
four main leader behavior studies in the
behavioral dimension.
 1-University of Iowa
A group of researchers: Lewin, Lippitt and White
connected the Iowa leadership studies in the 1930s.
Their main motivation for this work was to find answers
to the following key questions about leadership:
1.Why do groups rebel against authority?
2.Is not a democratic style of leadership more pleasant
than an authoritarian style of leadership. If this is true,
will not followers prefer a democratic leader over an
authoritarian leader?
A-Autocratic Leader
A leader who tended to centralize authority, dictate work
methods, make unilateral decision and limit employee
participation.
B-Democratic Leader
A leader who tended to involve employees in decision
making, delegate authority, encourage participation in
deciding work methods and goals, and use feedback as an
opportunity for coaching employees.
C-Laissez-faire
A leader who lets the group make decisions and complete
the work in whatever way it sees fit.
Research findings: mixed results
– No specific style was consistently better for
producing better performance.
– Employees were more satisfied under a
democratic leader than an autocratic leader.
 2- Ohio State Studies(1945)
Identified two dimensions of leader behavior
– Initiating structure: the role of the leader in defining
his or her role and the roles of group members.
– Consideration: the leader’s mutual trust and respect
for group members’ ideas and feelings.
Research findings: mixed results
– High-high leaders generally, but not always, achieved
high group task performance and satisfaction.
– Evidence indicated that situational factors appeared to
strongly influence leadership effectiveness.
 3- University of Michigan Studies by Rensis Likert (1950) 
Identified two dimensions of leader behavior
–The employee-oriented leader emphasized interpersonal
relationships by taking a personal interest in the needs of
employees and accepting individual differences among them.
–The production oriented leader emphasized the technical or
task aspects of the job, focusing on accomplishing the
group’s tasks.
Research findings:
– Leaders who are employee oriented are strongly
associated with high group productivity and high job
satisfaction.
 4-Managerial Grid
• Extending the Ohio and the Michigan
studies, Blake and Mouton developed
(1964) the concept of the managerial
grid.
 4- Managerial Grid

A two dimensional grid of

two leadership behaviors
concern for people
and
concern for production,
which resulted in five
different leadership
styles.
 High
Leadership Grid
9 1,9 9,9
Country club Team
8
management management
Concern 7

for 6

People 5 5,5
Middle of the road
4
management
3 Authority-
Impoverished obedience
2 management management
1
1,1 9,1
Low 1 2 3 4 5 6 7 8 9 High
Concern for production
Source: Reprinted by permission of Harvard Business Review. An exhibit from “Breakthrough in Organization Development” by Robert R. Blake, Jane S. Mouton, Louis
B. Barnes, and Larry E. Greiner, November–December 1964, p. 136. Copyright © 1964 by the President and Fellows of Harvard College. All rights reserved.
 Contingency Theories of Leadership

• Hersey and Blanchard’s Situational Leadership Theory (SLT)

The theory was first introduced in 1969 as "life cycle theory of
leadership”.
– Argues that successful leadership is achieved by
selecting the right leadership style which is
contingent on the level of the followers’ readiness.

– Why a leadership theory focuses on the followers?

– What is meant by term readiness?
 Contingency Theories of Leadership

• Hersey and Blanchard’s Situational Leadership Theory (SLT)

• Acceptance: leadership effectiveness depends on whether
followers accept or reject a leader.
• Readiness: the extent to which followers have the ability
and willingness to accomplish a specific task.
– Leaders must relinquish/give-up control over and
contact with followers as they become more
competent.
Hersey and Blanchard’s Situational Leadership Theory
– Creates four specific leadership styles incorporating
Fiedler’s two leadership dimensions:
• Telling: high task-low relationship leadership
• Selling: high task-high relationship leadership
• Participating: low task-high relationship leadership
• Delegating: low task-low relationship leadership
Hersey and Blanchard’s Situational Leadership Theory
– Posits / imagine four stages follower
readiness:
• R1: followers are unable and unwilling
• R2: followers are unable but willing
• R3: followers are able but unwilling
• R4: followers are able and willing
Path-goal Theory of Leadership
(By Robert House: 1971)
A leadership theory that says it’s the leader’s
job to assist his or her followers in attaining
their goals and to provide the direction or
support needed to ensure that their goals are
compatible with the overall objectives of the
group or organization.
• Path–goal theory assumes that leaders are flexible and that they can
change their style, as situations require. The theory proposes two
contingency variables, such as environment and follower
characteristics, that moderate the leader behavior-outcome
relationship.
• Environment is outside the control of the follower-task structure,
authority system, and work group. Environmental factors determine
the type of leader behavior required if the follower outcomes are to
be maximized. 
• Follower characteristics are the locus of control, experience, and
perceived ability.
• Effective leaders clarify the path to help their followers achieve
goals and make the journey easier by reducing roadblocks and
pitfalls. Research demonstrates that employee performance and
satisfaction are positively influenced when the leader compensates
for the shortcomings in either the employee or the work setting.
 Contemporary Views on Leadership
The transactional style of leadership was first
described by Max Weber in 1947 and then
by Bernard Bass in 1981. This style is most often
used by the managers.
Transactional Leadership
– Leaders who guide or motivate their followers in the
direction of established goals by clarifying role and
task requirements.
 Contemporary Views on Leadership
• The concept of transformational leadership was initially
introduced by James V. Downton (1973), the first to
coin the term "transformational leadership", a concept
further developed by leadership expert and presidential
biographer James MacGregor Burns.
Transformational Leadership
– Leaders who inspire followers to transcend their own self-
interests for the good of the organization by clarifying role
and task requirements.
– Leaders who also are capable of having a profound and
extraordinary effect on their followers.
Charismatic Leadership
– An enthusiastic, self-confident leader whose
personality and actions influence people to behave
in certain ways.
Visionary Leadership
– A leader who creates and articulates a realistic,
credible, and attractive vision of the future that
improves upon the present situation.