Chapter 12: Leadership TRUE/FALSE 1. Leadership is the process of influencing others to achieve group or organizational goals. Answer: True 2. One of the differences between managers and leaders is that managers focus on visions, missions, goals, and objectives, and leaders focus on productivity and efficiency. Answer: False Leaders focus on visions, missions, goals, and objectives, while managers focus on productivity and efficiency. 3. As the manager at a McDonald’s restaurant, Bob is more likely to worry about how fast orders from the drive-through window are filled than the company’s long-term operating expenditures. Answer: True 4. The primary difference between leaders and managers is that leaders are concerned with doing the right thing, and managers are concerned with doing things right. Answer: True 5. Whereas managers tend to have a short-term perspective, leaders tend to have a long-term perspective. Answer: True 6. According to the “Doing the Right Thing” box, business leaders should develop personal ethics by focusing on the mission, motivation, and managerial functions. Answer: False According to the “Doing the Right Thing” box, business leaders should develop personal ethics by focusing on the mission, a mentor, and the mirror. 7. According to the trait theory, all effective leaders possess a similar set of traits or characteristics. Answer: True 8. Since there are no consistent trait differences between leaders and non-leaders, or between effective and ineffective leaders, trait theory is wrong. Answer: False While this position has been historically accepted, more recent evidence shows that successful leaders are not like other people and that leaders differ from non-leaders on the following traits: drive, the desire to lead, honesty/integrity, self-confidence, emotional stability, cognitive ability, and knowledge of the business. 9. The leadership trait of integrity refers to the extent to which leaders do what they said they would do. Answer: True 10. As a leader behavior, initiating structure is the degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. Answer: True 11. As a leader behavior, consideration refers to the extent to which leaders do what they said they would do. Answer: False This defines integrity. Consideration is defined as the extent to which a leader is friendly, approachable, supportive, and shows concern for employees. 12. Initiating structure leader behavior has also been called job-centered leadership and concern for production. Answer: True 13. Consideration leader behavior has also been called concern for people and employee-centered leadership. Answer: True 14. While consideration primarily affects subordinates job performance, initiating structure primarily affects subordinates’ job satisfaction. Answer: False While initiating structure primarily affects subordinates’ job performance, consideration primarily affects subordinates’ job satisfaction. 15. Researchers at Ohio State University and the University of Texas found that leaders can simultaneously be considerate and initiate structure because consideration and initiating structure are independent behaviors. Answer: True 16. The four major situational leadership theories all assume that the effectiveness of any leadership style (the way a leader generally behaves toward followers) depends on the situation. Answer: True 17. There is no such thing as a “best” leadership style for all situations and employees. Answer: True 18. Fiedler’s contingency theory is based on the assumption that leaders are capable of adapting and adjusting their leadership styles to fit the demands of different situations. Answer: False Fiedler’s contingency theory is based on the assumption that leadership styles are tied to the leader’s underlying needs and personality and are therefore generally incapable of change. 19. Fiedler’s contingency theory states that in order to maximize work group performance, leaders must be matched to the situation that best fits their leadership style. Answer: True 20. In Fiedler’s contingency theory, the two situational factors that determine the favorability of a situation are leader-member relations and task structure. Answer: False In Fiedler’s contingency theory, three situational factors determine the favorability of a situation: leader-member relations, task structure, and position power. 21. Fiedler’s contingency theory has been used to place leaders in appropriate situations where they can perform most efficiently. Answer: True 22. Fiedler’s contingency theory has proven easy for practicing managers to understand and apply. Answer: False Research shows that managers have difficulty understanding and applying this highly complex model. 23. As described in the path-goal theory, directive leadership is similar to the key leadership behavior of initiating structure. Answer: True 24. Within the path-goal model, the achievement-oriented and participative leadership styles directly parallel the key leadership behaviors of initiating structure and consideration, respectively. Answer: False Within the path-goal model, the directive and supportive leadership styles directly parallel the key leadership behaviors of initiating structure and consideration, respectively. 25. Directive leadership is a leadership style in which leaders set challenging goals, have high expectations of employees, and display confidence that employees will assume responsibility and put forth extraordinary effort. Answer: False This is the definition of achievement-oriented leadership. Directive leadership involves letting employees know precisely what is expected of them, giving them specific guidelines for performing tasks, scheduling work, setting standards of performance, and making sure that people follow standard rules and regulations. 26. Virginia blames the fact that she is always late to work on traffic rather than her inability to get up early. She probably has a high internal locus of control. Answer: True 27. Path-goal theory specifies that leader behaviors should complement rather than duplicate the characteristics of followers’ work environments. Answer: True 28. Hersey and Blanchard’s situational theory is based on the idea of worker readiness. Answer: True 29. The two components of worker readiness are physical readiness and emotional readiness. Answer: False The two components of worker readiness are job readiness and psychological readiness. 30. Robert Haas, CEO of Levi Strauss & Company, has been described as very detail-oriented, which means that he probably wouldn’t use a delegating style of management. Answer: True 31. The normative decision theory helps leaders decide how much employee participation should be used when making decisions. Answer: True 32. According to the normative decision theory, using the right degree of employee participation improves the quality of decisions and the extent to which employees accept and are committed to decisions. Answer: True 33. In terms of research evidence, the path-goal theory has been described as the best supported of all leadership theories. Answer: False It is normative decision theory that has been described in this way. 34. Commitment probability, subordinate conflict, and commitment requirement rules are used to increase employee acceptance of and commitment to decisions. Answer: True 35. Strategic leadership is defined as the ability to think strategically and create a strategic plan for an organization. Answer: False Strategic leadership is defined as the ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate changes that will create a positive future for an organization (i.e., it includes implementation as well as thinking and planning). 36. Eddy Groves, the founder of ABC Learning Centres, the world’s largest child-care company, saw the need for child care long before most entrepreneurs did. Groves acted as a tactical leader. Answer: False He acted as a strategic or a visionary leader. 37. Transformational leadership is leadership that generates awareness and acceptance of a group’s purpose and mission and gets employees to see beyond their own needs and self-interest for the good of the group. Answer: True 38. While transformational leaders use visionary and inspirational appeals to influence followers, transactional leadership is based on an exchange process. Answer: True 39. The three components of transformational leadership are charisma, a strong internal locus of control, and strong position power. Answer: False The four components of transformational leadership are charismatic leadership, inspirational motivation, intellectual stimulation, and individualized consideration. MULTIPLE CHOICE 1. Effective managers define _____________ as the process of influencing others to achieve group or organizational goals. A. management B. leadership C. interpersonal influence D. supervision E. autonomy Answer: B Definition of leadership. 2. Which of the following is a major concern of managers (as opposed to leaders)? A. Maintaining the status quo B. Inspiring and motivating others C. Taking a long-term view D. Promoting change E. Organizational improvements Answer: A See Exhibit 12.1. 3. One of the criticisms of the television industry is the networks’ desire to maintain ratings by thinking in terms of next week’s programming. The networks are also more concerned with how to get high program ratings than achieving the ratings through giving viewers time to become acquainted with high-quality programs. Problem solving in terms of show placement or guest stars seems to be more important than inspiring great television innovations. This criticism assumes: A. doing the right things is more important than doing things right in the television industry B. the television industry benefits from strong leadership C. long-term strategy is more important than tactics in the television industry D. the television industry has a shortage of effective leadership E. the television industry attracts more architects than builders Answer: D Managers have a short-term perspective and are concerned with doing things right. Leaders have a long-term perspective and are concerned with doing the right things. 4. Which of the following is a major concern of leaders (as opposed to managers)? A. Controlling and limiting the choices of others B. Solving problems so that work can be done C. Preserving the status quo D. Inspiring and motivating others E. A focus on productivity and efficiency Answer: D See Exhibit 12.1. 5. Ford Motor Company has always attracted and nurtured capable managers, but it has failed to do the same for leaders. So, as part of the automaker’s organizational cultural overhaul, Ford is embarking on a sweeping attempt to mass manufacture leaders. It wants to build an army of “warrior-entrepreneurs.” Ford’s “warrior-entrepreneurs” will be expected to: A. take a long-term perspective B. inspire and motivate employees to embrace change C. realize that results are more important than processes D. be architects rather than builders E. do all of these things Answer: E See Exhibit 12.1 for the differences between managers and leaders. 6. Airline companies have blamed their recent financial problems on labor unions, the events of September 11, and a weak economy. Those airlines in financial difficulties have tried to solve the problem through short-term price reductions, firings and early retirements, and asking for employees to take pay cuts. The CEOs of these companies have not tried to motivate employees to create long-term solutions to the problems facing the companies. The CEOs of these troubled companies: A. are true leaders B. are more interested in doing the right thing than doing things right C. are promoting long-term change D. tend to focus on organizational visions, missions, goals, and objectives rather than organizational efficiency and productivity E. are more than likely managers rather than leaders Answer: E Managers have a short-term perspective and are concerned with doing things right. Leaders have a long-term perspective and are concerned with the doing the right things. 7. When Jack Welch went to work for General Electric, he immediately began to make drastic changes in the company’s structure and product lines. He envisioned a bloated, inefficient GE becoming an efficient, profitable organization over time. He inspired and motivated his employees to change. Jack Welch: A. would be characterized as a leader B. had a short-term perspective C. emphasized means rather than ends D. acted as a builder rather than an architect E. would be characterized as a manager Answer: A Welch was interested in long-term change, inspiring his workers, and the end results. See Exhibit 12.1. 8. Which of the following statements about leaders and managers is true? A. Organizations need both leaders and managers. B. Leaders are critical to getting out the day-to-day work. C. Managers are critical to inspiring employees and setting long-term direction. D. Most organizations place greater emphasis on leadership than on management. E. All of these statements about leaders and managers are true. Answer: A Although leaders are different from managers, organizations need them both. Managers are critical to getting out the day-to-day work. Leaders are critical to inspiring employees and setting long-term direction. Most organizations place greater emphasis on management than on leadership. 9. Relatively stable characteristics such as abilities, psychological motives, or consistent patterns of behavior form the basis for the _____________ of leadership. A. situational theory B. behavioral theory C. trait theory D. expectancy theory E. path-goal theory Answer: C These are traits associated with the trait theory of leadership. 10. According to an article from CIO Magazine, “Leadership grows from courage and integrity.” From this opening statement, you know the article will discuss leadership from the: A. University of Michigan perspective B. trait theory viewpoint C. situational approach to leadership D. motivational approach to leadership E. Hersey and Blanchard perspective Answer: B The trait theory is a leadership theory that holds that effective leaders possess a similar set of traits or characteristics. In this case, those leadership traits are courage and integrity. 11. Chang Yung-fa is the chairman of the Evergreen Group and founder of the world’s third-largest shipping company. Chang was born a sailor’s son and began his international company with one secondhand boat. Today, he is the head of Taiwan’s biggest business conglomerate. Chang’s accomplishments are probably a result of which of the following leadership traits? A. Drive B. Empathy C. Charisma D. Locus of control E. Power position Answer: A Drive refers to high levels of effort and is characterized by achievement, motivation, initiative, energy, and tenacity. 12. Which of the following traits refers to high levels of effort and is characterized by achievement, motivation, ambition, energy, tenacity, and initiative? A. Desire to lead B. Motivational cues C. Drive D. Self-confidence E. Charisma Answer: C These traits are characteristic of drive. 13. Which of the following traits refers to the extent to which leaders are truthful with others? A. Honesty B. Self-confidence C. Emotional stability D. Charisma E. Extroversion Answer: A Honesty, being truthful with others, is a cornerstone of leadership. 14. Oftentimes when an individual is running for a local political office, he or she promises to consider each issue, make decisions that are good for the entire community, and reduce taxes. When the individual assumes office, he or she is often unable to carry through on political promises, which leads to a perceived problem with: A. honesty B. integrity C. empathy D. drive E. charisma Answer: B Integrity is the extent to which leaders do what they say they will do. 15. Leaders who possess the trait of _____________ are more decisive and assertive and more likely to gain others’ confidence. A. emotional stability B. integrity C. self-confidence D. drive E. cognitive ability Answer: C Self-confident leaders are more decisive and assertive and are more likely to gain other’s confidence. 16. Which of the following traits refers to the tendency of leaders to remain even-tempered and consistent in their outlook and the way they treat others even when things go wrong? A. Honesty B. Integrity C. Emotional stability D. Self-confidence E. Cognitive ability Answer: C These are characteristics of an emotionally stable leader. 17. Which of the following statements about what makes a successful leader is true? A. Successful leaders have the same traits that non-leaders have. B. Successful leaders have drive, which is defined as the ability to attract and retain the best employees. C. Successful leaders are confident about their ability to make long-term strategic decisions even if the decisions seem risky to others. D. Successful leaders believe in individual reciprocity. E. None of these statements about what makes a successful leader is true. Answer: C Successful leaders do not have the same traits that non leaders have. Drive is defined as high levels of effort. Individual reciprocity is a bogus term. 18. Successful business leaders are not like other people. Successful business leaders: A. have a desire to lead B. have emotional stability C. are knowledgeable about business D. are self-confident E. are accurately described by all of these Answer: E See Exhibit 12.2. 19. According to What Really Works, “Leadership Traits Do Make a Difference,” which of the following traits was LEAST likely to cause employees to see their leader as a better leader? A. Extroversion B. Intelligence C. Dominance D. Charisma E. Emotional stability Answer: C Meta-analysis findings indicate that the probability of followers perceiving a leader as successful if that leader has a highly dominant personality is only 57 percent. 20. According to What Really Works, “Leadership Traits Do Make a Difference,” which of the following traits was MOST likely to cause employees to see their leader as a better leader? A. Extroversion B. Intelligence C. Dominance D. Agreeableness E. Introversion Answer: B On average, there is a 75 percent chance that intelligent leaders will be seen as better leaders than less intelligent leaders. 21. The University of Michigan, Ohio State University, and the University of Texas have found that _____________ and _____________ are central to successful leadership. A. initiating structure; considerate leader behavior B. initiating structure; job-centered leadership C. employee-centered leadership; considerate leader behavior D. concern for production; job-centered leadership E. autonomous; participative Answer: A At all three universities, two basic leader behaviors emerged as central to successful leadership: initiating structure and considerate leader behavior. 22. Which of the following is another term for considerate leader behavior? A. Initiating structure behavior B. Participative management C. Job-centered leadership D. Concern for production E. Employee-centered leadership Answer: E The term employee-centered leadership is used at the University of Michigan. 23. Which of the following is another term for considerate leader behavior? A. Initiating structure behavior B. Job-centered leadership C. Concern for people D. Concern for production E. Participative management Answer: C The term concern for people is used at the University of Texas. 24. Hot Topic is a fast-growing clothing chain targeted to the alternative teen demographic. Hot Topic’s CEO Betsy McLaughlin relies on her employees to locate new trends. Almost daily, McLaughlin consults with her employees for suggestions on what the stores should carry. She relies on their input before making inventory decisions and treats her employees as equals. McLaughlin is demonstrating: A. achievement orientation B. consideration C. charisma D. initiating structure E. empathy Answer: B Consideration is defined as the extent to which a leader is friendly, approachable, and supportive and shows concern for employees. 25. In terms of leadership behavior, the term _____________ refers to the extent to which a leader is friendly, approachable, and supportive and shows concern for employees. A. initiating structure B. job-centered leadership C. consideration D. concern for production E. autonomy Answer: C Definition of consideration. 26. Walter Reed Army Institute of Research has made a study of how important it is for military leaders to be friendly with and to show concern for their troops. Its research shows that a leadership behavior high in _____________ positively influences soldier health and their ability to adapt to stressful environments. A. achievement B. charisma C. consideration D. initiating structure E. vision Answer: C Consideration is defined as the extent to which a leader is friendly, approachable, and supportive and shows concern for employees. 27. Doris, the CEO of a local bank, believes that keeping staff happy and excited is the primary duty of a leader. This indicates that she is high in: A. achievement B. charisma C. consideration D. initiating structure E. vision Answer: C Consideration is defined as the extent to which a leader is friendly, approachable, and supportive and shows concern for employees. 28. United Fruit Company is the owner of the Chiquita brand of bananas. To get the bananas picked, United Fruit used a leadership style high in _____________ and emphasized how the fruit was to be picked and packed for transportation. It showed no concern for the workers. A. achievement B. charisma C. consideration D. initiating structure E. vision Answer: D Initiating structure is defined as the degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. 29. College football coaches are often high in _____________. They design every facet of practices, set goals for their players, determine schedules, and even direct all of the plays during the games. A. achievement B. consideration C. charisma D. initiating structure E. empathy Answer: D Initiating structure is defined as the degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. 30. A leader who consults with followers before setting goals is using: A. supportive leadership B. achievement-oriented leadership C. results-oriented leadership D. participative leadership E. experiential leadership Answer: C Participative leadership involves consulting employees for their suggestions and input before making decisions. 31. Which of the following is another term for initiating structure leadership behavior? A. Considerate leader behavior B. Employee-centered leadership C. Concern for people D. Concern for production E. Formalized people skills Answer: D The term concern for production is used at the University of Texas. 32. A CEO who tours company plants to meet and talk to employees at all levels in order to better understand their concerns and feelings is demonstrating which type of leader behavior? A. Consideration B. Leader formalization C. Autonomy D. Reciprocity E. Initiating structure Answer: A Consideration is defined as the extent to which a leader is friendly, approachable, and supportive and shows concern for employees. 33. Research shows that while initiating structure impacts primarily on _____________, consideration impacts primarily on _____________. A. job satisfaction; job performance B. job performance; job satisfaction C. job performance; motivational drive D. job satisfaction; worker synergy E. job description; job specification Answer: B Initiating structure primarily affects subordinates’ job performance, while consideration primarily affects subordinates’ job satisfaction. 34. ABC Learning Centres, an Australian-based company owned by Eddy Groves, is the world’s largest child-care company. One of the key advantages offered by the company is its ability to retain employees much longer than its competitors. (ABC has an 8 percent turnover; the industry average is 30 percent.) Groves offers employees numerous opportunities for free training, and each employee receives free company shares annually. By emphasizing job satisfaction instead of job performance, Groves is demonstrating what type of leadership behavior? A. Consideration B. Leader formalization C. Autonomy D. Reciprocity E. Initiating structure Answer: A Consideration primarily affects subordinates’ job satisfaction. 35. Which of the following statements about the two basic leader behaviors that are central to successful leadership is true? A. These behaviors are referred to as initiating structure and consideration. B. These behaviors are dependent, meaning that leaders can only do one at a time. C. The worst leadership style entails the use of both behaviors in equal amounts. D. The best leadership style entails high levels of both of these behaviors. E. Most effective leaders select one behavior, adopt it, and maintain that style of leadership for their entire careers. Answer: A Three universities have concluded that the two basic leader behaviors of initiating structure and consideration are central to successful leadership. 36. Which of the following statements about the two basic leader behaviors that are central to successful leadership is true? A. These behaviors are referred to as initiating structure and constructing networks. B. These behaviors are independent, meaning that leaders can do both at the same time. C. These behaviors both impact primarily on job performance. D. These behaviors have minimal impact on work environments. E. All of these statements about the two basic leader behaviors that are central to successful leadership are true. Answer: B These behaviors are referred to as initiating structure and consideration. Consideration behavior influences job satisfaction. These behaviors define the work environment. 37. Which of the following is the best leadership style for all situations? A. Team management B. Middle of the road management C. Authority-compliance D. Country club management E. None of these Answer: E Nearly 50 years of research indicates that there isn’t one best leadership style. The best leadership style depends on the situation. 38. Herman Edwards is the coach of the Kansas City Chiefs football team. As a successful coach, he has to schedule structured practices, emphasize careful planning, and assign tasks. He also has to show the players that he genuinely cares about them as people. According to the Blake/Mouton leadership grid, Edwards would be characterized as: A. authority-compliance B. country club management C. middle-of-the-road management D. team management E. impoverished management Answer: D Edwards would be characterized as high-high––high in initiating structure and high in consideration. See Exhibit 12.3. 39. Which of the following is an example of a situational theory of leadership? A. Stimulus-response theory B. Trait theory C. Fiedler’s contingency theory D. Equity theory of leadership E. Charismatic theory Answer: C Of the choices offered, only Fiedler’s contingency theory is a situational approach to leadership. 40. Which of the following leadership theories assumes that leadership styles are consistent and difficult to change? A. Path-goal theory B. Normative decision theory C. Fiedler’s contingency theory D. The status quo theory of leadership E. None of these Answer: C This is an assumption of Fiedler’s contingency theory. 41. Stan O’Neal is the new CEO of Merrill-Lynch. He began his tenure by firing the entire management committee. A few months later, he fired two of his hand-picked senior executives because they were “plotting to diminish his authority” and did not want to follow his orders unquestioningly. According to the Blake/Mouton leadership grid, O’Neal is using which style of management? A. Middle-of-the-road style B. Authority-compliance style C. Country club management style D. Impoverished management style E. Team management style Answer: B See Exhibit 12.3. The authority-compliance style is high in concern for production and low in concern for people. 42. Fiedler’s contingency theory assumes: A. leaders are effective when their work groups perform well B. leadership styles cannot be matched to the proper situation C. leaders can change their leadership styles to fit the situation D. favorable situations permit leaders to influence group members E. leaders should be judged according to how they perform––not how their subordinates perform Answer: A The first basic assumption of Fiedler’s theory is that leaders are effective when the work groups they lead perform well. 43. W. L. Gore is the company that created Gore-Tex, among many other innovative products. Gore employees (known as associates) don’t have titles or bosses in the traditional sense. Instead, associates make commitments to work on projects that they believe are most worthy of their time. At Gore, few leaders are appointed; leaders simply emerge as needed by the other employees or the project itself. Gore more than likely adheres to the _____________ theory of leadership. A. contingency B. normative C. strategic D. trait E. visionary Answer: A The contingency theory of leadership states that in order to maximize work group performance, leaders must be matched to the situation that best fits their leadership style. 44. In Fiedler’s contingency theory, _____________ refers to the degree to which leaders are able to hire, fire, reward, and punish workers. A. situational favorableness B. leader-member relations C. task structure D. position power E. situational un-favorableness Answer: D Definition of position power. 45. In Fiedler’s contingency theory, _____________ refers to the degree to which a particular situation either permits or denies a leader the chance to influence the behavior of group members. A. situational favorableness B. leader-member relations C. task structure D. position power E. task favorableness Answer: A Definition of situational favorableness. 46. Stan O’Neal, the CEO of Merrill-Lynch, began his tenure by firing the entire management committee. A few months later, he fired two of his hand-picked senior executives because they were “plotting to diminish his authority” and did not want to follow his orders unquestioningly. In terms of Fiedler’s contingency theory, O’Neal was most concerned with establishing: A. Situational favorableness B. Consideration C. Position power D. Goal commitment E. Empowerment quality Answer: A Situational favorableness is the degree to which a particular situation permitted the leader to influence the behavior of employees. 47. Larry Tobin is now president of Fairwinds Credit Union in Florida, where he started as a part-time teller. He’s learned to ignore one bit of advice he’s frequently heard, “Work with what you have.” Tobin doesn’t buy that view. He subscribes to the philosophy that calls for “having the right people on the bus and the right people in the right seats on the bus.” After Tobin assumed the helm at Fairwinds, he made several personnel changes. Which of the following seems most important to Tobin? A. Situational favorableness B. Initiating structure C. Position power D. Goal commitment E. Empowerment quality Answer: A Situational favorableness is the degree to which a particular situation permits the leader to influence the behavior of employees. 48. Larry Tobin is now president of Fairwinds Credit Union in Florida, where he started as a part-time teller. He’s learned to ignore one bit of advice he’s frequently heard, “Work with what you have.” Tobin doesn’t buy that view. He subscribes to the philosophy that calls for “having the right people on the bus and the right people in the right seats on the bus.” After Tobin assumed the helm at Fairwinds, he made several personnel changes. This ability to make these personnel changes defines Tobin’s: A. employee orientation B. position power C. goal specificity D. instrumentality E. tactical leadership skills Answer: B Position power is the degree to which leaders are able to hire, fire, reward, and punish workers. 49. Some employees called CEO Jack Welch “Bloody Jack” because his restructuring efforts at General Electric eliminated numerous jobs and product lines without thought to how individual employees were impacted. Welch was viewed as “the hatchet man,” the source of the firings. Under Fiedler’s contingency theory, Welch would be viewed by GE’s employees as having: A. an emphasis on initiating structure B. a relationship orientation C. weak position power D. strong position power E. an emphasis on consideration Answer: D Position power refers to the degree to which leaders are able to hire, fire, reward, and punish workers––in this case, strong position power because of Welch’s extensive amount of firings. 50. Stan O’Neal, the CEO of Merrill-Lynch, began his tenure by firing the entire management committee. A few months, later he fired two of his hand-picked senior executives because they were “plotting to diminish his authority” and did not want to follow his orders unquestioningly. In terms of situational favorableness, O’Neal demonstrated: A. high leader-member relations B. high initiating structure C. high goal commitment D. high power position E. all of these Answer: D Position power refers to the degree to which leaders are able to hire, fire, reward, and punish workers. 51. Which of the following approaches to implementing Fiedler’s contingency theory in the workplace has proven effective? A. Accurately measuring and matching leaders to situations B. Teaching managers how to change situational favorableness C. Arbitrary definition of situations D. Only hiring supervisors with appropriate leadership traits E. Creating standing plans concerning leader actions and reactions Answer: A One of the keys to applying Fiedler’s contingency theory in the workplace is to accurately measure and match leaders to situations. 52. According to _____________, leaders need to make clear how followers can achieve organizational goals, take care of problems that prevent followers from achieving goals, and then find more and varied rewards to motivate followers who achieve those goals. A. Fiedler’s contingency theory B. Blake and Mouton’s leadership grid C. the Vroom-Yetton-Jago normative decision model D. the path-goal theory E. the Boston Consulting Group leadership matrix Answer: D This is true of the path-goal theory. 53. Which of the following is NOT one of the four leadership styles identified in the path-goal theory of leadership? A. Directive B. Supportive C. Participative D. Charismatic E. Achievement-oriented Answer: D See Exhibit 12.7. 54. According to the path-goal theory of leadership, _____________ involves letting employees know precisely what is expected of them, giving them specific guidelines for performing tasks, scheduling work, setting standards of performance, and making sure that people follow standard rules and regulations. A. people-oriented leadership B. supportive leadership C. participative leadership D. achievement-oriented leadership E. directive leadership Answer: E Definition of directive leadership. 55. According to the path-goal theory of leadership, _____________ involves being friendly and approachable to employees, showing concern for them and their welfare, treating them as equals, and creating a friendly climate. A. directive leadership B. supportive leadership C. leadership empowerment D. achievement-oriented leadership E. participative leadership Answer: B Definition of supportive leadership. 56. Jeffrey Bleustein was the CEO who brought Harley-Davidson back from the brink of bankruptcy. During the first years he was CEO of Harley-Davidson, Bleustein said, “I was quite a directive leader because we needed to make progress quickly.” Bleustein would have: A. been very friendly with his employees B. told employees precisely what he expected them to do C. used employees’ inputs before making decisions D. assumed his employees would assume responsibility and put forth extraordinary effort E. used delegation Answer: B A directive leader lets employees know precisely what is expected of them, gives them specific guidelines for performing tasks, schedules work, sets standards of performance, and makes sure that people follow standard rules and regulations. 57. Jan Carlson, the former CEO of Scandinavian Airline Systems, believes the most important role for a leader is to instill confidence in people. According to the path-goal theory, this statement indicates that his leadership style would be: A. directive B. achievement-oriented C. employee-centered D. supportive E. job-centered Answer: D A supportive leader is friendly and approachable. By instilling confidence in workers, a supportive leader improves workers’ job satisfaction and their performance. 58. According to the path-goal theory of leadership, _____________ is very similar to considerate leader behavior. A. directive leadership B. supportive leadership C. participative leadership D. achievement-oriented leadership E. people-oriented leadership Answer: B As stated in the text, supportive leadership is very similar to considerate leader behavior. 59. Stan O’Neal, the CEO of Merrill-Lynch, began his tenure by firing the entire management committee. A few months later, he fired two of his hand-picked senior executives because they were “plotting to diminish his authority” and did not want to follow his orders unquestioningly. O’Neal is using a(n) _____________ leadership style to improve Merrill’s profitability. A. achievement-oriented B. supportive C. charismatic D. directive E. participative Answer: D A directive leadership style involves letting employees know precisely what is expected of them, giving them specific guidelines for performing tasks, scheduling work, setting standards of performance, and making sure that people follow standard rules and regulations. 60. When Leon was hired to manage his company’s distribution center, his supervisor advised him to “do things that satisfy followers today or will lead to future rewards or satisfaction” and “offer employees something unique and valuable beyond what they’re experiencing or can already do for themselves” if he wanted to be a successful leader. Which leadership theory does Leon’s supervisor apparently believe to be most effective in making a good leader? A. The trait theory of leadership B. Strategic leadership C. The path-goal theory D. The theory of initiating structure E. The contingency theory Answer: C The path-goal theory states that leaders can increase subordinate satisfaction and performance by clarifying and clearing the paths to goals and by increasing the number and kinds of rewards available for goal attainment. 61. Under the leadership of Michael Eisner, Walt Disney Company developed an “executive-centric, Eisner-centric culture”—whatever Eisner wanted to happen, he made happen. In terms of the path-goal theory, Eisner used a(n) _____________ leadership style to improve Disney’s profitability. A. achievement-oriented B. supportive C. charismatic D. directive E. participative Answer: D A directive leadership style involves letting employees know precisely what is expected of them, giving them specific guidelines for performing tasks, scheduling work, setting standards of performance, and making sure that people follow standard rules and regulations. 62. According to the path-goal theory of leadership, _____________ involves consulting employees for their suggestions and input before making decisions. A. directive leadership B. supportive leadership C. participative leadership D. consultative leadership E. achievement-oriented leadership Answer: C Definition of participative leadership. 63. In the path-goal theory of leadership, subordinate satisfaction and subordinate performance would be examples of: A. leadership stimuli B. subordinate contingencies C. environmental contingencies D. outcomes E. motivational cues Answer: D See Exhibit 12.7. 64. Which of the following is an example of an environmental contingency in path-goal theory? A. Locus of control B. Subordinate experience C. Perceived ability D. Subordinate performance E. Task structure Answer: E See Exhibit 12.7. Other environmental contingencies are formal authority system and primary work group. 65. According to the path-goal theory, which of the following is an example of an environmental contingency? A. Formal authority system B. Perceived ability C. Locus of control D. Subordinate satisfaction E. Focus of subordinate Answer: A See Exhibit 12.7. Other environmental contingencies are task structure and primary work group. 66. When Sarah Cummings took over as managing director of Masuichi-Ichimura Sake Brewery, she discovered that the company’s culture extolled the virtues of creating consensus for new strategies and policies. Cummings wanted to make immediate and radical changes to the company and did not have the time to gain consensus, so she used a _____________ style of leadership and told employees what they were going to do instead of maintaining the _____________ style that they were accustomed to. A. participative; supportive B. selling; telling C. supportive; directive D. participative; delegative E. directive; participative Answer: E A directive leader tells employees just what is expected of them, while a participative leader relies on employee input to make decisions. 67. Before Tony Hayward succeeded Lord Browne as BP’s chief executive, Hayward delivered an indictment of BP’s leadership style, corporate culture, and cost-cutting that appeared on the company’s internal website under the heading “Hayward Shares Candid Views on 2006.” According to the memo, Browne had an overly directive style of management, which had seriously damaged the company’s image with its stakeholders. In other words, Browne _____________. A. increased subordinates’ satisfaction and performance by clarifying and clearing the paths to goals and by increasing the number and kinds of rewards B. let employees know precisely what was expected of them, gave them specific guidelines for performing tasks, scheduled work, set performance standards, and made sure they followed standard rules and regulations C. was friendly and approachable to employees, showed concern for them and their welfare, treated them as equals, and created a friendly climate D. exhibited consideration leadership E. consulted employees to obtain their suggestions and input before making decisions Answer: B Directive leaders tell employees precisely what is expected of them, give them specific guidelines for performing tasks, schedule work, set standards of performance, and ensure that people follow standard rules and regulations. 68. Chang Yung-fa is the chairman of the Evergreen Group and founder of the world’s third-largest shipping company. Chang strongly believes that “an enterprise cannot do without a professional businessman at the helm, someone whose responsibility it is to manage the company with an autocratic touch so that the policies can be vigorously and completely implemented.” According to the path-goal theory, Chang is describing a(n) _____________ leader. A. achievement-oriented B. supportive C. charismatic D. directive E. participative Answer: D A directive leadership style involves letting employees know precisely what is expected of them, giving them specific guidelines for performing tasks, scheduling work, setting standards of performance, and making sure that people follow standard rules and regulations. 69. Pat Kelly, founder and CEO of PSS World Medical, a distributor of medical products, establishes ambitious goals for his employees and is confident that his employees will be able to achieve these goals. In terms of the path-goal theory, Kelly is exhibiting _____________ leadership. A. participative B. achievement-oriented C. delegating D. empowering E. supportive Answer: B An achievement-oriented leader sets challenging goals, has high expectations of employees, and displays confidence that employees will assume responsibility and put forth the effort needed. 70. The CEO of Credit Suisse First Boston is John Mack. Mack is turning the money-losing bank into a profitable firm by “goading workers to move out of their comfort zones” and setting challenging goals for them. His high expectation for his employees indicates that Mack is using _____________ leadership style. A. achievement-oriented B. supportive C. charismatic D. democratic E. participative Answer: A An achievement-oriented leader sets challenging goals, has high expectations of employees, and displays confidence that employees will assume responsibility and put forth the effort needed. 71. According to the path-goal theory of leadership, _____________ means setting challenging goals, having high expectations of employees, and displaying confidence that employees will assume responsibility and put forth extraordinary effort. A. directive leadership B. supportive leadership C. participative leadership D. achievement-oriented leadership E. empowerment leadership Answer: D Definition of achievement-oriented leadership. 72. Hot Topic is a fast-growing clothing chain targeted to the alternative teen demographic. Hot Topic’s CEO Betsy McLaughlin relies on her employees to locate new trends. Almost daily, McLaughlin consults with her employees for suggestions on what the stores should carry. She relies on their input before making inventory decisions. McLaughlin uses the _____________ style of management. A. achievement-oriented B. autonomous C. charismatic D. directive E. participative Answer: E A participative leader consults employees for their suggestions and input before making decisions. 73. W. L. Gore is the company that created Gore-Tex, among many other innovative products. Gore employees (known as associates) don’t have titles or bosses in the traditional sense. Instead, associates make commitments to work on projects that they believe are most worthy of their time. At Gore, few leaders are appointed; leaders simply emerge as needed by the other employees or the project itself. According to the path-goal theory, employees at Gore should have: A. high integrity B. a strong internal locus of control C. weak worker readiness D. a strong concern for production E. strong goal congruence Answer: B Locus of control indicates the extent to which people believe that they have control over what happens to them in life. Internals believe that what happens to them, good or bad, is largely a result of their choices and actions. 74. W. L. Gore is the company that created Gore-Tex, among many other innovative products. Gore employees (known as associates) don’t have titles or bosses in the traditional sense. Instead, associates make commitments to work on projects that they believe are most worthy of their time. At Gore, few leaders are appointed; leaders simply emerge as needed by the other employees or the project itself. Since the firm has been extremely successful since its inception, you can assume that Hersey and Blanchard’s situational theory would predict that Gore’s employees have: A. a high degree of worker readiness B. strong goal congruence C. a high degree of worker synergy D. a strong concern for people E. a strong concern for production Answer: A Worker readiness refers to the ability and willingness to take responsibility for directing one’s behavior. 75. Hersey and Blanchard’s situational theory states that leaders need to adjust their leadership styles to match: A. participative requirements B. the corporate culture C. the situation D. followers’ readiness E. employee responsiveness Answer: D According to this theory, leaders need to adjust their leadership styles to match followers’ readiness. 76. The two types of worker readiness identified by the Hersey and Blanchard’s situational theory are: A. task readiness and experience readiness B. experience readiness and cognitive readiness C. affective readiness and cognitive readiness D. psychological readiness and physiological readiness E. job readiness and psychological readiness Answer: E Readiness has two components: job readiness and psychological readiness. 77. According to Hersey and Blanchard’s situational theory, which of the following is NOT an example of a leadership style? A. Telling B. Empowering C. Participating D. Delegating E. Selling Answer: B There is no empowerment style in Hershey and Blanchard’s situational theory. 78. Stan O’Neal is the CEO of Merrill-Lynch. According to Hersey and Blanchard’s situational theory, O’Neal is high in task behavior and low in relationship behavior. In other words, he uses a(n) _____________ leadership style. A. telling B. empowering C. participating D. delegating E. selling Answer: A A telling leadership style has high task behavior and low relationship behavior. 79. Hot Topic is a fast-growing clothing chain targeted to the alternative teen demographic. Hot Topic’s CEO is Betsy McLaughlin. The chain succeeds because it is constantly on the lookout for new trends that appeal to this market. To help her locate these trends, McLaughlin relies on her employees. Since she is high in relationship behavior and high in task behavior, Hersey and Blanchard’s situational theory indicates that she has a(n) _____________ leadership style. A. telling B. empowering C. participating D. delegating E. selling Answer: E A selling leadership style has high task behavior and high relationship behavior. 80. When Sarah Cummings took over as managing director of Masuichi-Ichimura Sake Brewery, she discovered that the company’s current culture extolled the virtues of creating consensus for new strategies and policies. According to Hersey and Blanchard’s situational theory of leadership, Cummings would most likely have to use a _____________ leadership style to encourage its employees to accept and implement the immediate and radical changes she desired. A. telling B. empowering C. participating D. delegating E. selling Answer: E A selling leadership style involves two-way communication and psychological support to encourage followers to own, or buy into, a particular way of doing things. 81. W. L. Gore is the company that created Gore-Tex, among many other innovative products. Gore employees (known as associates) don’t have titles or bosses in the traditional sense. Instead, associates make commitments to work on projects that they believe are most worthy of their time. At Gore, few leaders are appointed; leaders simply emerge as needed by the other employees or the project itself. According to Hersey and Blanchard’s situational theory, what type of leadership style is used by Gore’s top management? A. Telling B. Empowering C. Participating D. Delegating E. Selling Answer: D The workers at W. L. Gore are allowed “to run their own show.” 82. United Fruit Company is the owner of the Chiquita brand of bananas. To get the bananas picked, United Fruit used the _____________ leadership style to direct poorly skilled workers in every step of the process. The workers had a low readiness level. A. selling B. delegating C. empowering D. participating E. telling Answer: E A telling leadership style is based on one-way communication in which followers are told what, how, when, and where to do particular tasks. 83. The normative decision theory: A. states that the situation determines what leadership style to use B. assumes that certain inalienable characteristics determine the most effective leaders C. helps leaders determine how much employee participation should be used in decision making D. assumes leader behavior can be fitted to subordinate characteristics E. assumes leaders are generally unable to change their leadership style Answer: C Definition of normative decision theory. 84. To save Northwest Airlines from bankruptcy, its CEO Doug Steenland has told its employees that he will eliminate 53 percent of the company’s mechanics and reduce the compensation of the remaining by 26 percent. In terms of the normative decision theory, Steenland is: A. making consultative decisions B. using a telling leadership style C. making autocratic decisions D. using a selling leadership style E. using an adaptive leadership style Answer: C A leader who makes autocratic decisions makes them by himself. 85. The Vroom-Yetton-Jago model is another name for the: A. normative decision theory B. contingency theory of leadership C. path-goal theory of leadership D. situational theory of leadership E. trait theory of leadership Answer: A The Vroom-Yetton-Jago model is also known as normative decision theory. 86. Which of the following decision styles is used in the normative decision model? A. Participative B. Achievement-oriented C. Supportive D. Group E. People-oriented Answer: D There are five decision styles specific to the normative decision theory, which range from autocratic decisions to consultive decisions to group decisions. 87. In many organizations, sales managers develop company-wide sales forecasts by asking members of the sales force to decide how much growth they anticipate in their individual sales territories. Sales managers then take the input from the individual salespeople and create company-wide sales forecasts based on the information supplied by their subordinates. In the normative decision model, this would be an example of a(n) _____________ decision-making style. A. consultative B. group C. autocratic D. participative E. supportive Answer: A With consultative decisions, leaders share the problems with subordinates but still make the decision themselves. 88. When Sarah Cummings took over as managing director of Masuichi-Ichimura Sake Brewery, she discovered that while the company’s current culture extolled the virtues of creating consensus for new strategies and policies, it had lost money for the past 30 years and was facing bankruptcy. Cummings might have used _____________ to determine how much employee participation she was going to need when making reorganization decisions. A. the path-goal theory of leadership B. the contingency theory of leadership C. the normative decision theory D. Hersey and Blanchard’s situational theory of leadership E. the trait theory of leadership Answer: C The normative decision theory helps managers determine how much employee participation should be used in decision making. 89. Which of the following is an example of a rule used within normative decision theory to increase decision quality? A. The subordinate conflict rule B. The goal congruence rule C. The worker readiness rule D. The commitment requirement rule E. The commitment probability rule Answer: B Other decision rules are listed in Exhibit 12.10. 90. Which of the following leadership theories uses a decision tree to determine the appropriate level of participation by subordinates in decision making? A. Fiedler’s contingency theory B. Blake and Mouton’s leadership grid C. Path-goal theory D. Vroom-Yetton-Jago model E. Trait theory Answer: D See Exhibit 12.11 for an example of a normative decision theory tree. The normative decision theory is also known as the Vroom-Yetton-Jago model. 91. _____________ is the ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate change that will create a positive future for the organization. A. Strategic leadership B. Initiating leadership C. Vision congruence D. Progressive leadership E. Empathetic leadership Answer: A Definition of strategic leadership. 92. Trucking companies are facing labor shortages and unprecedented worker mobility. Leaders are needed who will do more than simply manage or direct drivers, owner-operators, and the staff who supports them. Instead, these leaders need to inspire, coach, encourage, and guide. They need to earn consensus by working as part of the team, providing resources to get the job done, then getting out of the way and letting their people perform. They need to be _____________ leaders. A. strategic B. transactional C. directive D. autonomous E. job-oriented Answer: A Strategic leaders have the ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate change that will create a positive future for the industry. 93. _____________ is leadership that creates a positive image of the future that motivates organizational members and provides direction for future planning and goal setting. A. Visionary leadership B. Supportive leadership C. Transactional leadership D. Achievement-oriented leadership E. Leadership empowerment Answer: A Definition of visionary leadership. 94. Malcolm Thompson was brought in as the CEO of Novalux, a company involved in laser research, to save the company’s promise of innovation. It’s what he loves: turning ideas into companies, then shaping those businesses to meet evolving challenges. “You’re never done,” he says. “It always looks like you’re near the finish line, but there are always new opportunities along the road––and new obstacles you’d never thought of. That’s part of the exploration––constantly looking at the next problem and the next solution.” Apparently, Thompson is an example of a: A. leadership substitute B. trait leader C. leadership neutralizer D. visionary leader E. transactional leader Answer: D A visionary leader creates a positive image of the future that provides direction for future planning and goal setting. 95. The two types of visionary leadership are: A. tactical leadership and charismatic leadership B. charismatic leadership and transformational leadership C. situational leadership and transactional leadership D. transformational leadership and transactional leadership E. situational leadership and strategic leadership Answer: B Charismatic leadership and visionary leadership are the two types of visionary leadership. 96. Some psychologists contend that Democratic presidential nominee Al Gore lost the 2000 election because he was not charismatic. In other words, they think he: A. did not have a vision B. was not seen as uniquely special C. had a participating leadership style D. chose his leadership style on the basis of the situation E. exhibited goal incongruence Answer: B Max Weber wrote that the special qualities of charismatic leaders enable them to strongly influence followers. 97. In the book The Science of Good and Evil, its author describes his meeting with the founders of Google. He described them as visionary leaders, which means their primary goal for being in business is to: A. get rich B. show off their intelligence and expertise C. create a positive image of the future D. have as much free time as possible E. be charismatic Answer: C Visionary leadership creates a positive image of the future that motivates organizational members. 98. The two kinds of charismatic leaders are referred to as: A. ethical charismatics and unethical charismatics B. effective charismatics and ineffective charismatics C. transformational leaders and transactional leaders D. visionary leaders and non-visionary leaders E. those who have learned how to be charismatic and those who are naturally charismatic Answer: A Ethical charismatics provide developmental opportunities for followers, while unethical charismatics control and manipulate followers. 99. The 1993 stand-off between federal agents and people inside the Branch Davidian compound at Waco, Texas, resulted in the deaths of approximately 80 Branch Davidians, including leader David Koresh, who had declared himself the new messiah. Koresh used _____________ to create the strong relationships between him and his followers who were willing to die for him. A. a leadership substitute B. transactional leadership C. a leadership neutralizer D. charismatic leadership E. trait leadership Answer: D A charismatic leader creates exceptionally strong relationships with his followers. 100. _____________ refers to the behavioral tendencies and personal characteristics of leaders that create an exceptionally strong relationship between them and their followers. A. Consideration leadership B. Charismatic leadership C. Transactional leadership D. Transformational leadership E. Leadership empowerment Answer: B Definition of charismatic leadership. 101. Charismatic leaders: A. articulate a vision based on strongly held values B. have strong coercive and reward power C. have trouble delegating D. base their influence on an exchange process in which followers are rewarded for good performance and punished for poor performance E. are accurately described by none of these Answer: A Charismatic leaders also model those values by acting in a way consistent with the vision, communicate high performance expectations to followers, and display confidence in followers’ abilities to achieve the vision. 102. When Sarah Cummings took over as managing director of Masuichi-Ichimura Sake Brewery, the company was facing bankruptcy. Cummings used______ to focus on the premium sake market and got the company to return to traditional sake production in order to differentiate itself from other breweries. A. strategic leadership B. initiating leadership C. vision readiness D. proactive leadership E. empathetic leadership Answer: A Strategic leadership is the ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate changes that will create a positive future for an organization. 103. Richard Ward, the new chief executive of Lloyd’s of London, was charged with implementing the company’s three-year blueprint for change. At his hiring, Ward announced, “I am focusing on reducing measurably Lloyd’s operating costs by means of a series of practical reforms and innovations, which will please and motivate Lloyd’s employees and customers.” Ward plans to use _____________ to improve Lloyd’s bottom line. A. visionary leadership B. supportive leadership C. transactional leadership D. achievement-oriented leadership E. leadership empowerment Answer: A Visionary leadership creates a positive image of the future that motivates organizational members and provides direction for future planning and goal setting. 104. When Robert Haas became the CEO of Levi Strauss & Company, he envisioned Levi Strauss as a company where a factory worker’s voice was as likely to be heard as that of the CEO. “He’s not the sort of manager who says, ‘Here’s what you did wrong,’” explains Levi’s former CFO George James. “Instead, he sits down, looks you in the eye and asks, ‘What do you think you did wrong?’” Because of his obvious sincerity, Levi’s employees are fiercely loyal to him. From this description, you can infer that Haas is a _____________. A. consideration leader B. charismatic leader C. transactional leader D. reactive leader E. leadership delegator Answer: B Charismatic leadership describes the behavioral tendencies and personal characteristics of leaders who build exceptionally strong relationships with followers. 105. People with Machiavellian personalities believe that virtually any type of behavior is acceptable if it helps satisfy needs or accomplish goals. Put that personality type with the ability to create strong bonds with followers and you have described a leader who is a(n): A. negative transformation leader B. transactional leader C. country club manager D. reactive leader E. unethical charismatic leader Answer: E An unethical charismatic leader controls and manipulates followers and will develop a vision alone solely to meet a personal agenda. Some companies will even overlook bad behavior as long as a profit is being made. 106. _____________ will control and manipulate followers, do what is best for themselves instead of their organizations, want to hear only positive feedback, share only information that is beneficial to themselves, and have moral standards that put their interests before everyone else’s. A. Manipulative charismatics B. Machiavellian charismatics C. Unethical charismatics D. Illegitimate charismatics E. Charismatic ombudsmen Answer: C Definition of unethical charismatics. 107. Transformational leaders: A. are able to make their followers feel they are a vital part of the organization B. encourage followers to make sacrifices for the organization C. help followers see how their jobs fit with the organization’s vision D. get employees to see beyond their own needs for the good of the group E. are accurately described by all of these Answer: E All of these accurately describe transformational leaders. 108. James Casey founded UPS in 1907 as a message delivery business. The development of the telephone would have put an end to the business if Casey had not been a _____________ leader who was able to get his employees to accomplish more than they had thought possible and re-invent the company as a company that delivered goods for retailers. A. transformational B. substitute C. participative D. transactional E. supportive Answer: A Transformational leaders generate awareness and acceptance of a group’s purpose and mission and get employees to see beyond their own needs and self-interest for the good of the group. 109. _____________ generates awareness and acceptance of a group’s purpose and mission and gets employees to see beyond their own needs and self-interest for the good of the group. A. Virtual leadership B. Charismatic leadership C. Leadership empowerment D. Transformational leadership E. Transactional leadership Answer: D Definition of transformational leadership. 110. Which of the following is NOT a component of transformational leadership? A. Idealized influence B. Supportive influence C. Intellectual stimulation D. Individualized consideration E. Inspirational motivation Answer: B Transformational leadership has four components: charismatic leadership or idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration. 111. Haas required all Levi’s employees to attend the company’s “core curriculum,” a three-part, ten-day course covering leadership, diversity, and ethical decision making. Joined by at least one senior manager, groups of 20 employees discussed their vulnerabilities, shared their deepest fears, and even composed their obituaries. Haas was trying to exhibit: A. virtual leadership B. charismatic leadership C. leadership empowerment D. transformational leadership E. transactional leadership Answer: D Transformational leadership generates awareness and acceptance of a group’s purpose and mission and gets employees to see beyond their own needs and self-interest for the good of the group. 112. Which of the following is one of the steps recommended for companies to take to reduce the risks associated with unethical charismatic leaders? A. Enforce a clearly written code of conduct. B. Recruit, select, and promote managers with high ethical standards. C. Train leaders how to value, seek, and use diverse points of view. D. Reward employees who act ethically, especially managers. E. All of these are recommended steps to take to reduce the risks associated with unethical charismatics. Answer: E All of steps can reduce risks associated with this type of charismatic leader. 113. Transactional leaders: A. reward followers for good behavior and punish followers for poor behavior B. help followers see how their jobs fit with the organization’s vision C. pay special attention to individual needs by creating learning opportunities D. motivate followers by providing them with meaningful and challenging work E. are accurately described by all of these Answer: A Transactional leadership is based on an exchange process. 114. As CEO of UPS, Michael Eskew is transforming the company from a package delivery service to a logistics expert so it can serve as a traffic manager for corporate America. As a transformational manager, Eskew is: A. insisting his employees do the right thing B. creating opportunities for rewards C. using intellectual stimulation to encourage his employees to take innovative approaches to problem solving D. encouraging his employees to depend on information technology as the basis for decision making E. creating heuristics to guide the transformation procedure Answer: C Exhibit 12.12 shows the components of transformational leadership. 115. _____________ is based on an exchange process, in which followers are rewarded for good performance and punished for poor performance. A. Visionary leadership B. Charismatic leadership C. Leadership empowerment D. Transformational leadership E. Transactional leadership Answer: E Definition of transactional leadership. 116. The component of transformational leadership known as _____________ means that transformational leaders pay special attention to followers’ individual needs by creating learning opportunities, accepting and tolerating individual differences, encouraging two-way communication, and being good listeners. A. idealized influence B. inspirational motivation C. intellectual stimulation D. individualized consideration E. influential stimulation Answer: D Definition of individualized consideration. 117. Which leadership style would be most likely to rely on positive and negative reinforcement? A. Transformational leadership B. Charismatic leadership C. Participative leadership D. Delegating leadership E. Transactional leadership Answer: E Transactional leadership involves both rewards for good performance, as well as punishment for poor performance. 118. Research results consistently show that: A. transformational leadership is much more effective on average than transactional leadership B. transactional leadership is much more effective on average than transformational leadership C. transformational and transactional leadership are both equally effective D. transformational leadership tends to emerge from transactional leadership E. transformational leadership based on a vision is more effective than when it is based on an exchange process Answer: A Studies consistently show that transformational leadership is much more effective on average than transactional leadership. 119. Refer to “What Would You Do?” As CEO of PepsiCo, which of the following is NOT something Indra Nooyi should focus on? A. Change B. Ends C. Problem solving D. Long-term view E. Doing the right thing Answer: C The job of a CEO is to lead, inspire, and influence, focusing on positive change, ends, and long-term visions. 120. Refer to “What Would You Do?” Tim Minges commented that Nooyi “challenges you.” This is indicative of which of the following leadership styles? A. Achievement-oriented leadership B. Leadership C. Supportive leadership D. Directive leadership E. Shared leadership Answer: A Achievement-oriented leadership is associated with the setting of challenging goals. 121. Refer to “What Would You Do?” Effective leaders like Indra Nooyi tend to possess a similar set of __________, which are relatively stable characteristics such as abilities, psychological motives, or consistent patterns of behavior. A. behaviors B. ethical charismatics C. position powers D. traits E. personalities Answer: D Definition of traits. SHORT ANSWER 1. Define leadership and management. Explain how leaders and managers approach their jobs differently. Answer: Leadership is the process of influencing others to achieve group or organizational goals. Management is the process of getting work done through others. Leaders are different from managers. The primary difference is that leaders are concerned with doing the right thing, while managers are concerned with doing things right. Furthermore, managers have a short-term focus and are concerned with the status quo, with means rather than ends, and with solving others’ problems. By contrast, leaders have a long-term focus, are concerned with change, with ends rather than means, and with inspiring and motivating others to solve their own problems. 2. List and briefly identify four of the eight traits that differentiate leaders from non-leaders. Answer: Recent evidence shows that successful leaders are not like other people and that successful leaders are indeed different from the rest of us. More specifically, leaders are different from non-leaders on the following traits: drive, the desire to lead, honesty/integrity, self-confidence, emotional stability, cognitive ability, and knowledge of the business. Drive refers to high levels of effort and is characterized by achievement, motivation, initiative, energy, and tenacity. Desire to lead refers to a preference to be in charge and influence others. Honesty refers to being truthful with others, while integrity refers to doing what you say you will do. Self-confidence refers to believing in one’s abilities. Emotional stability means that individuals remain even-tempered and consistent in their outlook and in the way they treat others even when things go wrong. Cognitive ability refers to the capacity to analyze large amounts of seemingly unrelated, complex information and the ability to see patterns or opportunities or threats where others might not see them. Finally, knowledge of the business means that individuals understand the key technological decisions and concerns facing their companies. 3. What is the difference between honesty and integrity? How is each relevant to effective leadership? Answer: Honesty means being truthful with others and is a cornerstone of leadership. Without honesty, leaders won’t be trusted. But with it, subordinates are willing to overlook other flaws. For example, one follower said this about the leadership qualities of his manager: “I don’t like a lot of the things he does, but he’s basically honest. He’s a genuine article and you’ll forgive a lot of things because of that. That goes a long way in how much I trust him.” Integrity is the extent to which leaders do what they said they will do. Leaders may be honest and have good intentions, but if they don’t consistently deliver on what they promise, they won’t be trusted. 4. What are the two key leader behaviors that are central to successful leadership? How does each typically influence subordinates? Answer: Research has identified two key leadership behaviors that form the basis for many leadership theories. These key behaviors are initiating structure and consideration. Initiating structure is defined as the degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. Research demonstrates that this behavior primarily improves subordinates’ job performance. Consideration, on the other hand, is defined as the extent to which a leader is friendly, approachable, supportive, and shows concern for employees. Research indicates that this behavior primarily improves subordinates’ job satisfaction. 5. List the four major situational theories of leadership. How do they differ in terms of what each assumes about the adaptability of leadership style (i.e., a leader’s ability to change his or her leadership style in different situations)? Answer: The four major situational leadership theories are Fiedler’s contingency theory, path-goal theory, Hersey and Blanchard’s Situational Leadership theory, and Vroom and Yetton’s normative decision model. These theories all assume that the effectiveness of any leadership style, the way a leader generally behaves toward followers, depends on the situation. Accordingly, there is no one best leadership style. However, these theories differ in one significant way. Fiedler’s contingency theory assumes that leadership styles are consistent and difficult to change. Therefore, leaders must be placed in or matched to a situation that fits their leadership style. The other three situational theories all assume that leaders are capable of adapting and adjusting their leadership styles to fit the demands of different situations. 6. What are the assumptions of Fiedler’s contingency theory? What needs to be done in order to make this theory practical for use in the workplace? Answer: Fiedler’s theory assumes that leaders are effective when their work groups perform well, that leaders are unable to change their leadership styles, that leadership styles must be matched to the proper situation, and that favorable situations permit leaders to influence group members. Since Fiedler assumes that leaders are incapable of changing their leadership styles. The key is to accurately measure and match leaders to situations or to teach leaders how to change situational factors. While matching or placing leaders in appropriate situations works well, “re-engineering situations” to fit leadership styles hasn’t worked because of the complexity of the model, which people find difficult to understand. Thus, the real key to practicality seems to be appropriately measuring manager’s leadership styles and then properly matching them to situations. 7. According to the path-goal theory, what are the two leadership styles that parallel the two key leadership behaviors of initiating structure and consideration? Describe each style. Answer: The two leadership styles within the path-goal theory that parallel the key leadership behaviors of initiating structure and consideration are directive leadership and supportive leadership. Directive leadership involves letting employees know precisely what is expected of them, giving them specific guidelines for performing tasks, scheduling work, setting standards of performance, and making sure that people follow standard rules and regulations. Supportive leadership involves being friendly and approachable to employees, showing concern for them and their welfare, treating them as equals, and creating a friendly climate. 8. Briefly describe the value of the normative decision theory to the practicing manager. Answer: The normative decision theory (also known as the Vroom-Yetton-Jago model) helps leaders decide how much employee participation (from none to letting employees make the entire decision) should be used when making decisions. Using the right degree of employee participation improves the quality of decisions and the extent to which employees accept and are committed to decisions. Since this approach has been described as the best supported of all leadership theories, it offers an extremely valuable template to managers to use in determining what extent of participative management to use in any given circumstance. It can thus increase managerial effectiveness. 9. Identify and define the components of visionary leadership. Answer: Visionary leadership creates a positive image of the future that motivates organizational members and provides direction for future planning and goal setting. There are two types of visionary leadership, charismatic and transformational leadership. Charismatic leaders have strong, confident, dynamic personalities that attract followers, enable them to create strong bonds, and inspire followers to accomplish the leader’s vision. Transformational leadership goes beyond charismatic leadership by generating awareness and acceptance of a group’s purpose and mission and by getting employees to see beyond their own needs and self-interest for the good of the group. 10. Briefly explain the difference between transformational and transactional leadership. Answer: Transformational leadership refers to leadership that generates awareness and acceptance of a group’s purpose and mission and gets employees to see beyond their own needs and self-interest for the good of the group. Transformational leaders transform their organizations by getting their followers to accomplish more than they intended and even more than they thought possible. A distinction needs to be drawn between transformational leadership and transactional leadership. While transformational leaders use visionary and inspirational appeals to influence followers, transactional leadership is based on an exchange process, in which followers are rewarded for good performance and punished for poor performance. When leaders administer rewards fairly and offer followers the rewards that they want, followers will often reciprocate with effort. However, transactional leaders often rely too heavily on discipline or threats to bring performance up to standards. While this may work in the short run, it’s much less effective in the long run. The result is that studies consistently show that transformational leadership is much more effective on average than transactional leadership. ESSAY 1. What does management research say about who leaders are and what leaders do? Comment on the best leadership style for all situations and employees. Provide an example of a leader that you know of or have worked with, and explain how this individual demonstrates some of the typical characteristics and behaviors identified by management research as typical of leaders. Answer: Management research has attempted to identify the typical characteristics of leaders for many years through an approach known as trait theory, which has also been referred to as the “great person” theory. Trait theory is one way to describe who leaders are. Trait theory says that effective leaders possess a similar set of traits or characteristics. Traits are relatively stable characteristics, such as abilities, psychological motives, or consistent patterns of behavior. Until recently, studies indicated that trait theory was wrong and that there were no consistent trait differences between leaders and non-leaders, or between effective and ineffective leaders. However, more recent evidence shows that “successful leaders are not like other people,” that successful leaders are indeed different from the rest of us. More specifically, leaders are different from non-leaders on the following traits: drive, the desire to lead, honesty/integrity, self-confidence, emotional stability, cognitive ability, and knowledge of the business. These traits may be defined as follows. Drive refers to high levels of effort and is characterized by achievement, motivation, initiative, energy, and tenacity. Desire to lead refers to a preference to be in charge and influence others. Honesty refers to being truthful with others, while integrity refers to doing what you say you will do. Self-confidence refers to believing in one’s abilities. Emotional stability means that individuals remain even-tempered and consistent in their outlook and in the way they treat others even when things go wrong. Cognitive ability refers to the capacity to analyze large amounts of seemingly unrelated, complex information and the ability to see patterns or opportunities or threats where others might not see them. Finally, knowledge of the business means that individuals understand the key technological decisions and concerns facing their companies. However, traits aren’t enough for successful leadership. Leaders who have these traits (or many of them) must behave in ways that encourage people to perform appropriately. That is, leaders must do certain things. They must perform behaviors or take actions to influence others to achieve group or organizational goals. Two key leader behaviors have been identified through hundreds of studies, which in turn evaluated hundreds of leader behaviors. These studies identified two key leadership behaviors, which form the basis for many leadership theories. These key behaviors are initiating structure and consideration. Initiating structure is defined as the degree to which a leader structures the roles of followers by setting goals, giving directions, setting deadlines, and assigning tasks. Research demonstrates that this behavior primarily improves subordinates job performance. Consideration, on the other hand, is defined as the extent to which a leader is friendly, approachable, supportive, and shows concern for employees. Research indicates that this behavior primarily improves subordinates’ job satisfaction. While different theorists and researchers have argued for years over what the “best” leadership style is, the research has demonstrated that there is no best combination of these behaviors. The best leadership style depends on the situation. In other words, no one leadership behavior by itself and no one combination of leadership behaviors works well across all situations and employees. Student examples should clearly identify the presence of several of the typical leadership traits and should also specify circumstances in which the leader functioned by using either or both initiating structure and consideration behavior. Better answers will provide clear descriptions of leaders demonstrating a variety of the relevant traits and will specify concrete situational examples for the two dimensions of leadership behavior. 2. Identify and describe Fiedler’s contingency theory. Explain how this approach might be particularly valuable to an experienced manager in selecting among several job offers for managerial positions in different organizational situations. Answer: Fiedler’s contingency theory is one of four situational theories of leadership, which all assume that the effectiveness of any leadership style (i.e., the way a leader generally behaves toward followers) depends on the situation. Fiedler’s theory assumes that leaders are effective when their work groups perform well, that leaders are unable to change their leadership styles, that leadership styles must be matched to the proper situation, and that favorable situations permit leaders to influence group members. According to the Least Preferred Coworker (LPC) scale, there are two basic leader styles. People who describe their LPC in a positive way have relationship-oriented leadership styles. By contrast, people who describe their LPC in a negative way have task-oriented leadership styles. Situational favorableness occurs when leaders can influence followers and is determined by leader-member relations, task structure, and position power. In general, relationship-oriented leaders with high LPC scores are better leaders under moderately favorable situations, while task-oriented leaders with low LPC scores are better leaders in highly favorable and unfavorable situations. Since Fiedler assumes that leaders are incapable of changing their leadership styles, the key is to accurately measure and match leaders to situations or to teach leaders how to change situational factors. While matching or placing leaders in appropriate situations works well, “reengineering situations” to fit leadership styles hasn’t worked because of the complexity of the model, which people find difficult to understand. The implications of the research on this model for an experienced manager in selecting among several job offers are potentially straightforward. Since the manager is experienced, he or she should be able to get an accurate assessment of leadership style using the LPC scale. Once the manager has identified him or herself as either a task- or relationship-oriented leader, the next step would be to assess the situational favorability in each of the potential new managerial positions, by assessing or estimating leader-member relations, task structure, and position power in each job. The manager should then select the position with the favorableness level that most closely matches his or her leadership style according to Fiedler’s effectiveness criteria, since the research cited above demonstrates that matching leaders to situations works well, while re-engineering situations does not. 3. Compare and contrast charismatic and transformational leadership. Explain why ethical transgressions are less likely among transformational leaders than they are among charismatic leaders. Answer: Charismatic and transformational leadership are the two kinds of visionary leadership, which are, in essence, leadership styles that allow leaders to achieve strategic leadership. Strategic leadership is the ability to anticipate, envision, maintain flexibility, think strategically, and work with others to initiate changes that will create a positive future for an organization. It represents the fourth approach to leadership (after traits, behaviors, and situational theories). Strategic leadership requires visionary, charismatic, and transformational leadership. Visionary leadership creates a positive image of the future that motivates organizational members and provides direction for future planning and goal setting. It is manifest in terms of either charismatic or transformational leadership styles. Charismatic leaders have strong, confident, dynamic personalities that attract followers, enable them to create strong bonds, and inspire followers to accomplish the leader’s vision. There are two types of charismatic leaders, differentiated by their level of adherence to ethical principles. These two types are referred to as ethical and unethical charismatics. Followers of ethical charismatic leaders work harder, are more committed and satisfied, are better performers, and are more likely to trust their leaders. Followers can be just as supportive and committed to unethical charismatics, but these leaders can pose a tremendous risk for companies. Unethical charismatics control and manipulate followers and do what is best for themselves instead of their organizations. To reduce the risks associated with unethical charismatics, companies need to enforce a clearly written code of conduct; recruit, select, and promote managers with high ethical standards; train leaders how to value, seek, and use diverse points of view; teach everyone in the company to recognize unethical leader behaviors; and celebrate and reward people who exhibit ethical behaviors. Transformational leadership goes beyond charismatic leadership by generating awareness and acceptance of a group’s purpose and mission and by getting employees to see beyond their own needs and self-interest for the good of the group. The four components of transformational leadership are charismatic leadership or idealized influence, inspirational motivation, intellectual stimulation, and individualized consideration. It is the first of these components that explains why ethical transgressions are less likely among transformational leaders than they are among charismatic leaders. Charismatic leadership or idealized influence means that transformational leaders act as role models for their followers. Because transformational leaders put others’ needs ahead of their own and share risks with followers, they are admired, respected, and trusted, and followers want to emulate them. Thus, in contrast to purely charismatic leaders (especially unethical charismatics), transformational leaders can be counted on to do the right thing and maintain high standards for ethical and personal conduct. Test Bank for Effective Management Chuck Williams 9781285866246
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