CH-6-7 Appraising and Rewarding Performance – Organizational Behavior: Human Behavior at Work : Book Guide

This Document Contains Chapters 6 to 7 Chapter 6 Appraising and Rewarding Performance Suggested Answers to Discussion Questions 1. Explain how money can be both an economic and a social medium of exchange. As a student, how do you use money as a social medium of exchange? Students’ answers will vary. Money as an economic exchange enables people to purchase products and services. As a social medium of exchange, money represents status, in terms of peer and employer appraisal. Students’ use of money as a social medium may include their feelings as to how the level of pay received indicates their value to their employers or how much respect they receive from classmates. They also may use money to gain respect from people around them by purchasing gifts for friends, helping to feed hungry people in other countries, or purchasing clothing that they feel shows their status. Money serves as both an economic and a social medium of exchange. Economically, money is a medium of exchange that facilitates transactions for goods and services. It allows individuals to trade their labor or products for a universally accepted form of value, enabling specialization and increasing overall economic efficiency. Socially, money plays a crucial role in interpersonal interactions and relationships. It can be used to express gratitude, show appreciation, and strengthen social bonds. For example, giving gifts or treating friends to meals are ways in which money is used socially to enhance relationships and express generosity. As a student, I use money as a social medium of exchange in various ways. For instance, I might contribute to group expenses for a shared activity or event, such as buying snacks for a study group or pitching in for a classmate's birthday gift. Additionally, I might use money to support causes or organizations that I believe in, demonstrating my values and priorities through financial contributions. Overall, money serves not only as a means of economic transaction but also as a tool for social interaction and relationship building in my student life. 2. Think of a job that you formerly had or now have. a. Discuss specifically how the expectancy model applied (applies) to your pay. b. Discuss how you felt (feel) about the equity of your pay and why you felt (feel) that way. c. Develop and explain a cost-reward comparison chart for your pay and effort. a. Expectancy Model: In my previous job as a customer service representative, the expectancy model applied to my pay in the sense that I believed my performance directly influenced my pay raises and bonuses. I understood that if I provided exceptional service, I would receive higher performance ratings, which could lead to increased pay through merit increases or incentives. b. Equity of Pay: I felt that the equity of my pay was fair overall. I based this feeling on comparisons with industry standards and discussions with colleagues about their pay. While I may have occasionally felt that some coworkers received higher pay for similar work, I recognized that factors like experience, performance, and job responsibilities could justify these differences. c. Cost-Reward Comparison Chart: In this chart, I've outlined the various aspects of my pay and effort. My base salary was fixed but competitive, providing a sense of stability. Bonuses and incentives were performance-based, offering a potential for higher earnings based on my efforts. Benefits, including health insurance and retirement plans, were valuable but didn't directly impact my take-home pay. Overall, while I felt my pay was equitable, the rewards also included intangible benefits like job satisfaction and work-life balance, making the cost-reward comparison favorable. a. Students should demonstrate familiarity with expectancy, instrumentality, and valence. Students could come up with answers like “I didn’t try, because I knew I couldn’t do well,” which would indicate a problem with the student’s expectancy; “I didn’t try too much, because I knew they wouldn’t really give me anything extra for better work,” reflects a poor instrumentality; and “I didn’t want to be singled out by the bosses,” might mean the student didn’t want to receive the reward of recognition. b. Equality of pay should foster a discussion of equity in pay. Students may report equity, under reward, or even over reward situations. c. The comparison chart should reflect the inputs and outputs of the student compared to the inputs and outputs of a referent other (or others). The chart is a graphical representation of the student’s equity perceptions. 3. Think of a time when you assessed, either formally or informally, someone else’s level of performance and found it deficient by your standards. To what did you attribute the reasons for the inadequate performance? Were you engaging in any attributional tendencies? How could you avoid doing so? Answers to this question will vary. Some students may recognize that the standards which they have may not be shared with others. In a previous role, I had to assess the performance of a team member who consistently failed to meet project deadlines. I attributed this deficiency to a lack of time management skills and a tendency to procrastinate based on observable behaviors such as frequent last-minute rushes to complete tasks and a disorganized approach to workload prioritization. Reflecting on this situation, I realize that I may have engaged in attributional tendencies, specifically the fundamental attribution error, by attributing the inadequate performance solely to the individual's internal characteristics, such as laziness or incompetence, while overlooking external factors that could have contributed, such as unclear task expectations or workload overload. To avoid such tendencies in the future, I could adopt a more holistic approach to performance assessment. This might involve considering a wider range of factors that could influence performance, including external circumstances, organizational constraints, and individual strengths and limitations. Additionally, I could engage in open and honest communication with the individual to understand their perspective and any challenges they may be facing, fostering a more collaborative and empathetic approach to performance evaluation. 4. Assume that, in the first six months of your first job, your manager asks you to participate in filling out a feedback form describing his or her strengths and weaknesses. How comfortable will you feel in doing this? Now assume your manager asks you to engage in the same process, seeking feedback from your peers, manager, and customers about yourself. Now what is your reaction? Explain. Answer to this question will vary. Students may respond that they would be comfortable describing the manager’s strengths but not the weaknesses unless the responses are anonymous and kept strictly confidential. Employees sometimes avoid giving realistic appraisal, when negative, because they do not want to disrupt an existing smooth relationship. This is sort of a 360-degree feedback process on the manager, which requires trained personnel, and students may say that they are uncomfortable due to lack of training and expertise. Employees may also fear a retribution from higher placed officials and may therefore refrain from providing negative feedback. Students’ answers will vary. Feedback on Manager's Performance: As a new employee in my first job, I would likely feel somewhat uncomfortable participating in filling out a feedback form describing my manager's strengths and weaknesses. Given my limited experience and understanding of the organizational dynamics, I might worry about the potential repercussions of providing negative feedback, even if it is constructive. However, I would also recognize the importance of honest feedback in helping my manager improve and grow professionally. Seeking Feedback on My Performance: If my manager asked me to engage in the same process, seeking feedback from peers, manager, and customers about myself, my reaction would be more positive. While I might initially feel a bit apprehensive about receiving feedback, I would ultimately see it as an opportunity for growth and self-improvement. I would value the insights and perspectives of others, recognizing that their feedback could help me identify areas for development and enhance my performance in the long run. Overall, while both scenarios involve providing and receiving feedback, my comfort level would differ based on my role and the direction of the feedback. In the first scenario, I might feel more hesitant due to my position as a new employee and the potential power dynamics involved. In the second scenario, I would be more open to feedback, viewing it as a valuable tool for personal and professional development. 5. What are the major measures used to link pay with outputs? Which ones, if any, were used in the last job you had? Discuss the effectiveness of the measure or measures used. Incentives may be based on quantity of output, quality of output, success in reaching goals, or some combination of techniques. There are also profit-sharing incentives, gain sharing incentives, and skill-based pay. Measures Used to Link Pay with Outputs: 1. Piece Rate Pay: Employees are paid based on the number of units they produce. This measure directly links pay with output, incentivizing higher productivity. 2. Merit Pay: Pay increases are based on individual performance evaluations. This measure rewards high performers with higher pay, linking pay with output quality and quantity. 3. Profit Sharing: Employees receive a share of the company's profits. This measure links pay with overall organizational performance, encouraging employees to contribute to the company's success. 4. Sales Commission: Sales employees earn a percentage of the sales they generate. This measure directly links pay with output (sales), motivating employees to increase sales efforts. 5. Bonuses: Lump-sum payments based on achieving specific goals or targets. This measure provides a direct link between performance and pay, motivating employees to achieve desired outcomes. Effectiveness of Measures in Last Job: In my last job, merit pay and bonuses were used to link pay with outputs. Merit pay was based on annual performance evaluations, where employees were rated on various criteria such as job knowledge, productivity, and teamwork. High performers received higher pay increases compared to average performers. Bonuses were given for achieving specific sales targets or project milestones. I found these measures to be effective in motivating employees to perform at their best. Knowing that my pay was directly linked to my performance encouraged me to set challenging goals and strive for excellence. However, I also observed that the subjective nature of performance evaluations for merit pay could sometimes lead to disagreements or perceptions of unfairness. Overall, I believe that a combination of merit pay and bonuses effectively linked pay with outputs in my last job, driving performance and results. 6. Would you use profit sharing, gain sharing, skill-based pay, or wage incentives in any of the following jobs? Discuss your choice in each instance. a. Employees in a small fast-growing computer company b. Teacher in a public school c. Insurance claims processor in an insurance office d. Automobile repair mechanic in a small repair shop e. Farm worker picking peaches f. Production worker in a shoe factory making men’s shoes a. Employees in a Small Fast-Growing Computer Company: • Profit Sharing: Yes, profit sharing could be used to motivate employees to contribute to the company's growth and success. It aligns their interests with the company's profitability, encouraging them to work towards common goals. b. Teacher in a Public School: • Skill-Based Pay: Yes, skill-based pay could be used to incentivize teachers to enhance their skills and qualifications. It rewards them for acquiring new knowledge and expertise, which can lead to improved teaching quality. c. Insurance Claims Processor in an Insurance Office: • Wage Incentives: Yes, wage incentives could be used to reward claims processors for processing claims efficiently and accurately. It encourages them to maintain high productivity and quality standards. d. Automobile Repair Mechanic in a Small Repair Shop: • Gain Sharing: Yes, gain sharing could be used to reward mechanics for increasing the shop's efficiency and profitability. It motivates them to work together to improve processes and reduce costs. e. Farm Worker Picking Peaches: • Wage Incentives: Yes, wage incentives could be used to reward farm workers for their productivity in picking peaches. It provides them with a direct incentive to work efficiently and pick more peaches. f. Production Worker in a Shoe Factory Making Men’s Shoes: • Profit Sharing: Yes, profit sharing could be used to reward production workers for contributing to the factory's success. It motivates them to be more productive and efficient in their work. In each instance, the choice of incentive is based on aligning the reward system with the specific job roles and objectives. Profit sharing and gain sharing are suitable for jobs where employees can directly impact the company's profitability or efficiency. Skill-based pay is suitable for roles where acquiring new skills and knowledge is beneficial. Wage incentives are suitable for jobs where productivity and output can be easily measured and rewarded. Students’ answers may vary. In choosing an incentive method for these situations, it is helpful to look at each plan first. Profit sharing is best used with fast-growing organizations where the potential exists for employee rewards. It is also appropriate for managers and high-level professionals. Skill-based pay is more appropriate for situations that involve individual effort rewarded on an hourly pay basis, with increases for learning new skills either within the job or other jobs in the company. Wage incentives should be used when increased productivity is desired; employees are paid according to how much they produce. Based on these facts, profit sharing would be appropriate for the first situation, skill-based pay would suit the second and fourth examples, and wage incentives would be the best for the third, fifth, and sixth situations. 7. Divide into small groups, each led by a member who has worked for a sales commission. Discuss how the commission related to both equity theory and expectancy theory, and report highlights of your discussion to your entire classroom group. Students’ answers may vary. The cornerstone of any compensation system, especially one involving incentives, is employee acceptance of the system. Equity comparisons will constantly be made, and any perception on the part of some employees that other employees have been given preferential treatment in the awarding of incentives will undermine the entire program. Therefore, it is imperative that all incentives be fairly and consistently rewarded and all rules of the incentive system be followed at all times. Further, performance appraisal and measurement must be done correctly, so that employees get feedback of performance results, so that they may make accurate equity comparisons. Expectancy theory comes into play, particularly, in the areas of instrumentality and valence. Instrumentalities will be high only if the employees perceive that management consistently awards the bonuses each time they are earned. Also, the rewards must be valent; they must be provided in a form that is valued by the employees. In our small group led by a member who has worked for a sales commission, we discussed how the commission related to both equity theory and expectancy theory. Equity Theory: We found that equity theory was highly relevant to understanding how sales commission impacted our perceptions of fairness in the workplace. Those of us who had experienced receiving sales commissions felt that our pay was fair when it was proportional to the effort and results we put in. However, there were instances where we felt unfairly compensated, especially when we perceived that others received higher commissions for similar efforts or when external factors beyond our control affected our sales. Expectancy Theory: We also discussed how expectancy theory played a role in our motivation and performance. The expectation of earning a commission motivated us to work harder and strive for higher sales. We found that when we believed our efforts would lead to successful outcomes (higher sales), and that these outcomes would be rewarded with a commission, we were more motivated to perform at our best. Overall, our group agreed that the sales commission system was effective in motivating us to achieve our sales targets. However, we also recognized the importance of ensuring fairness and transparency in how commissions were awarded to maintain motivation and morale among sales employees. 8. Have you ever participated in restriction of output in a job or in an academic course? If so, discuss why you did it and what its consequences were. Students’ answers will vary. Output restriction happens when workers (students included) limit their production, defeating the purpose of incentives. There are a variety of causes that lead to restriction of output— group insecurities, resistance to change by the informal social organization and people are not comfortable always working at full capacity. Those students who answer “yes” to this question probably experienced either a poorly designed incentive system or one in which management had lost the trust of the employees. Behaviors such as restricting output are sometimes called “norming” influences. They typically come about because members of the work group are afraid that if they perform too much better than the standard, management will just raise the standard, which makes earning future bonuses even harder. Consequences of “norming” are that the organization doesn’t get the production it should, and workers are not as motivated by their work as they could have been had management set and followed proper rules for their incentive system. In my previous job, I participated in a form of restriction of output. The situation arose when my team felt overwhelmed by an excessive workload due to understaffing and unrealistic project deadlines. Despite our efforts to communicate these concerns to management, our workload remained unmanageable, leading to increased stress and decreased morale among team members. As a result, my team and I collectively decided to restrict our output by prioritizing tasks that were critical to the business and slowing down on less urgent projects. While this helped us cope with the workload temporarily, it also had consequences. Our overall productivity decreased, and some project deadlines were missed, which affected our team's reputation for delivering results on time. However, the restriction of output also served as a wake-up call to management, highlighting the need for better resource allocation and more realistic project planning. Eventually, management took steps to address these issues, leading to improved working conditions and a more manageable workload for our team. In hindsight, while the restriction of output was a temporary solution to a larger problem, it also highlighted the importance of effective communication between employees and management in addressing workload issues and maintaining productivity. 9. “Skill-based pay is a waste of company money, because we are paying for potential performance instead of actual performance.” Discuss this statement. Students’ answers will vary. Students should point out the advantages of the skill-based incentive plan: • Employees are motivated to develop skills • Employee self-esteem is reinforced • A highly flexible workforce results • Employee boredom is reduced • Employee pay may be higher for multiple skills • Perception of equity may be favorable if same-skill employees are paid equally Disadvantages include: • Higher hourly pay rates for the employer • Higher training costs • The lack of desire in some employees to learn new skills which can lead to employees leaving the organization The first two disadvantages should be offset by the increased productivity that results. The third disadvantage is more difficult to eliminate. Organizations will have a better chance of successfully implementing a skill-based method if management is supportive and trusting of its employees, and if the system is understood and accepted by the employees. The statement that "Skill-based pay is a waste of company money, because we are paying for potential performance instead of actual performance" overlooks the strategic benefits and long-term value that skill-based pay can provide to organizations. Development of Future Performance: Skill-based pay incentivizes employees to acquire and enhance their skills, which can lead to improved performance in the future. By investing in employees' skill development, organizations are investing in their future performance potential, which can result in higher productivity and better outcomes in the long run. Increased Employee Engagement: Skill-based pay can increase employee engagement and job satisfaction. When employees see that their efforts to improve their skills are being recognized and rewarded, they are more likely to be motivated and engaged in their work, leading to higher levels of performance. Attraction and Retention of Talent: Skill-based pay can help attract and retain top talent. Employees are more likely to stay with a company that recognizes and rewards their skills, rather than seeking opportunities elsewhere. This can result in cost savings for organizations by reducing turnover and the associated costs of hiring and training new employees. Competitive Advantage: Skill-based pay can also provide organizations with a competitive advantage. Employees with advanced skills are more capable of innovating, problem-solving, and adapting to changing business environments, giving their employers an edge in the market. In conclusion, skill-based pay is not a waste of company money; rather, it is an investment in employees' future performance and the overall success of the organization. By recognizing and rewarding employees for their skills, companies can create a more engaged and skilled workforce, leading to improved performance and competitiveness. 10. Rate your level of performance in this class relative to all others. What percentage of classmates do you think are below you? Now seek that information from your instructor and match it with your own. If the two figures do not match, provide several explanations for it. Student answers will vary. Many may be surprised if the figures don’t match and may ask for instructor feedback on how they can improve. Self-Assessment: In rating my level of performance in this class relative to all others, I would estimate that I am performing above average compared to my classmates. I believe that a majority of my classmates are below me, perhaps around 70% or so. Seeking Feedback: Upon seeking feedback from my instructor, I learned that my performance is actually in the top 20% of the class. This information is surprising and differs significantly from my self-assessment. Possible Explanations: 1. Overestimation: I may have overestimated my performance due to biases such as the overconfidence effect, where individuals tend to overestimate their abilities. 2. Perception Bias: My perception of others' performance may have been skewed, leading me to believe that a larger percentage of classmates are below me than is actually the case. 3. Lack of Information: Without detailed knowledge of others' performance, I may have made assumptions based on limited interactions or incomplete information. 4. Comparison Basis: My basis for comparison may have been inaccurate, leading to an incorrect assessment of my performance relative to others. 5. Different Evaluation Criteria: My instructor may have used different criteria or assessments to evaluate performance, leading to a discrepancy between my perception and the actual ranking. In conclusion, the discrepancy between my self-assessment and the instructor's feedback could be due to a combination of biases, perception errors, and differences in evaluation criteria. This highlights the importance of seeking objective feedback and being aware of biases that can impact our perceptions of our own performance relative to others. Assess Your Own Skills Students should honestly circle the number on the response scale that most closely reflects the degree to which each statement accurately describes them when they reward employees and conduct a performance appraisal. This section will help them understand how well they exhibit good reward and performance appraisal skills. Incident Plaza Grocery Solutions to this case should incorporate aspects of expectancy theory, equity theory, intrinsic and extrinsic motivators, and pay as a motivator. Most experts agree that money is a motivator for most employees, especially if the rewards system is managed well. This means, for example, that rewards must be valent (expectancy theory) in that they must be things that the employees actually value, that rewards must be perceived by the employees to be fairly distributed (equity theory), and that there is a performance appraisal system in place that adequately measures performance. Regarding pay, an incentive system of some sort should be helpful in the grocery store setting. Management must be careful to set incentives for work over which the clerk/carryout workers control the pace. For example, it would do little good to pay carryout workers a bonus for carrying out more than ten orders per hour if there are times when the store has few customers checking out. The stocking of shelves could be placed on incentive, but management must do some time study or work measurement first to determine reasonable standards upon which the bonuses would be based. One good idea might be to organize the clerk/carryout employees into work teams for work assignments and incentive bonuses, which would motivate them through friendly competition. Motivators beyond pay can be considered, too. Praise and recognition are always helpful in these settings. Management could select a “stock clerk of the week,” for example, who would receive a letter of recognition and a ten-dollar gift certificate to be used in the store. Intrinsic motivation could be addressed, too. By giving the workers some discretion over what stocking they do when, how they decide who is carrying out and who is stocking, etc., some challenge can be built into the work which would lead to higher intrinsic motivation. Experiential Exercise Performance Appraisal/Reward Philosophy The students are asked to read a set of statements (given in the text) about people and indicate their degree of agreement or disagreement on the rating scales. Meeting in small discussion groups, they are asked to tabulate the responses to each question (frequency distribution and mean) and explore reasons for any significant disagreements within their group’s ratings. In their group, they are asked to develop alternative statements for any items they do not support (ratings of 3, 4, or 5) at present. Finally, they are asked to explain how their new statements reflect their knowledge of human behavior gained through reading the early chapters of this book. Generating OB Insights Students’ responses will vary for this exercise. They should however, highlight several of the major topics discussed in the chapter such as appraisals, rewards, incentives, pay packages and various plans of incentives. Chapter 7 Leadership Suggested Answers to Discussion Questions 1. Explain the difference between management and leadership. Discuss why conceptual leadership skills become more important, and technical skills less important, at higher organizational levels. Students’ answers may vary. Leadership is but a part of management. Management includes the functions of planning, organizing, leading, and controlling. Managers use their formal position influence to plan, organize, and control. On the other hand, leadership often involves informal influence as well. It is possible for a weak leader to be a good planner, and it is possible for a good leader to be a poor planner or controller. As a manager is promoted to higher-level positions, the scope of job duties becomes broader, more abstract, and more strategic. Such demands require more conceptual skill, while at the same time the top manager has a large number of lower-level managers to provide technical expertise. The higher a manager climbs the corporate ladder, the lesser he has to look out for day-to-day technicalities involved at the lower levels. Management and leadership are often used interchangeably, but they refer to distinct functions within an organization. Management is about planning, organizing, directing, and controlling resources (such as people, money, and materials) to achieve specific goals. It involves ensuring that tasks are completed efficiently and effectively, often focusing on the day-to-day operations and implementation of strategies. On the other hand, leadership is about inspiring, motivating, and influencing others to achieve common goals. It involves setting a vision, creating a sense of purpose, and guiding individuals and teams towards that vision. Leaders often focus on inspiring and empowering their teams, fostering innovation and change, and building strong relationships within the organization and beyond. As individuals move up the organizational hierarchy, from lower to higher levels, the nature of their roles changes. At lower levels, technical skills are often more critical because employees are primarily involved in performing specific tasks and executing plans. However, as individuals progress to higher levels, such as middle or senior management, conceptual leadership skills become more important. This shift occurs because leaders at higher levels are responsible for setting direction, aligning resources, and shaping the organization's culture and strategy. They need to think strategically, analyze complex situations, and make decisions that impact the entire organization. Technical skills become less important at these levels because leaders are no longer directly involved in performing tasks; instead, they rely on their teams to execute plans. In summary, while management focuses on executing plans and tasks, leadership is about setting direction and inspiring others to achieve common goals. As individuals move up in the organizational hierarchy, conceptual leadership skills become more critical because leaders at higher levels are responsible for shaping the organization's future and guiding it towards success. 2. A manager once told a subordinate, “To be a good leader, you must first become a good follower.” Discuss what it means to be a good follower, whether you agree with the statement, and why or why not. Students’ answers may vary. Being a good follower teaches the follower to listen, learn and understand what it takes to be a successful leader. Being a good follower can also be considered the “proving ground” for future leadership potential. Communications go up and down the hierarchy, so it is important to learn how to follow others’ directions in order to better give direction later in a leadership position. However, being a good follower does not mean one should be a “yes person.” A good follower is supportive of leaders, is a “team player” who does not compete for the limelight, and finds constructive ways to confront the leader’s ideas, values, and actions. A good follower automatically qualifies to succeed a good leader because he learns and imbibes the qualities of the leader as well as the technical knowledge of how things are shared within a team and the organization. Being a good follower involves several key traits and behaviors that contribute to the overall effectiveness of a team or organization. Good followers are supportive, reliable, and committed to the goals and values of the organization. They are also proactive in seeking feedback, learning from others, and contributing their ideas and perspectives. Additionally, good followers are respectful of authority, but they are not afraid to speak up constructively when they have concerns or suggestions. The statement that "to be a good leader, you must first become a good follower" suggests that effective leadership is built on a foundation of understanding and experiencing what it means to be a follower. By being a good follower, individuals can develop important skills and insights that are valuable for leadership roles, such as empathy, collaboration, and the ability to see things from different perspectives. I agree with this statement to some extent. While not every good follower will become a good leader, the experience of being a follower can provide valuable lessons and perspectives that can enhance one's leadership abilities. However, I also believe that leadership is a distinct skill set that involves more than just following. Effective leaders must be able to inspire and motivate others, make difficult decisions, and navigate complex challenges, which may require different skills and qualities than those needed to be a good follower. In conclusion, while being a good follower can provide valuable insights and skills that are beneficial for leadership, leadership also requires its own unique set of abilities and attributes. Both roles are important and complementary, but they are not necessarily interchangeable. 3. Think of the best leader you have ever worked with on a job, in sports, or in any other activity. Then think of the worst leader. Discuss the contrasting styles and skills used by the two. How did you respond to each? What could they have done differently? Students’ answer may vary. Most of the students would probably report that the good leader displayed more concern for people than the poor leader, and probably had more experience, higher personal drive, higher integrity, more self-confidence, and better analytical ability than the poorer leader. Some will probably also mention the charisma, creativity, and flexibility of the good leader. What separates good leaders from bad ones is the degree to which the leader in question motivates and inspires his people to achieve common goals. Good leaders know when to employ participative methods as well as times when they have to take matters into their own hands and employ autocratic methods. The best leader I have ever worked with was during my time in a previous job. This leader, let's call him John, possessed exceptional communication skills. He was always clear in his expectations, provided regular feedback, and was approachable whenever I needed guidance or support. John also demonstrated a high level of emotional intelligence, which allowed him to understand and empathize with the challenges faced by his team members. He was supportive and encouraging, which motivated me to perform at my best. On the other hand, the worst leader I encountered was in a different job. This leader, let's call her Sarah, had poor communication skills and often left her team members feeling confused and demotivated. Sarah was also overly critical and rarely acknowledged the efforts of her team. Her lack of empathy and understanding made it difficult for me to approach her with any concerns or ideas. In response to John's leadership, I felt motivated, engaged, and empowered. I was eager to contribute and take on new challenges because I felt supported and valued. In contrast, Sarah's leadership left me feeling frustrated and demoralized. I was less motivated to perform well and often felt hesitant to voice my opinions or suggestions. Looking back, John could have further improved his leadership by involving the team more in decision-making processes and providing opportunities for professional growth and development. Sarah, on the other hand, could have benefited from improving her communication skills, showing more appreciation for her team members' efforts, and being more open to feedback and suggestions. 4. Explain how Theory X and Theory Y relate to leadership styles, especially the contingency approaches and super leadership. Comment on the statement “management philosophy controls practice.” McGregor’s Theory X and Theory Y deal with assumptions held by managers. In reviewing the leadership styles discussed in the textbook, one can conclude that the positive, participative, consultative, and consideration leadership styles would be used by a manager who holds Theory Y assumptions, while the negative, autocratic, and structure styles would be a Theory X manager’s approach. Fiedler’s contingency model and Hersey and Blanchard’s situational model point out that the leadership styles used by a Theory Y manager may not always be appropriate. The key to both models is that the style of leadership chosen should be based on the relevant situation. This implies that, at times, the autocratic or structure approaches may be more appropriate than participative or consideration. For example, an employee may actually dislike work and try to avoid it. In this instance, a negative approach (threatening loss of job) might be more effective. Assumption of Theory Y relates to super leadership. Student comments relative to “management philosophy controls practice” will vary according to personal opinion. Students should realize, however, that management’s philosophy regarding operations, decision making, personnel practices, and even the organization’s design will affect how these areas are handled. Theory X and Theory Y, proposed by Douglas McGregor, are two contrasting views of human motivation and behavior in the workplace. Theory X assumes that employees are inherently lazy, dislike work, and need to be closely monitored and controlled to ensure they meet organizational goals. In contrast, Theory Y assumes that employees are self-motivated, enjoy work, and can be trusted to take responsibility and be creative in achieving organizational objectives. These theories relate to leadership styles in the sense that Theory X is often associated with a more autocratic and directive leadership style, where managers closely supervise and control their subordinates. This style is based on the belief that employees need to be coerced or incentivized to perform. In contrast, Theory Y aligns more with a participative and empowering leadership style, where leaders trust their employees, involve them in decision-making, and create a supportive work environment that fosters motivation and engagement. Contingency approaches to leadership, such as Fiedler's Contingency Model and Hersey and Blanchard's Situational Leadership Theory, suggest that the most effective leadership style depends on various situational factors, including the characteristics of the followers and the nature of the task. These approaches recognize that there is no one-size-fits-all approach to leadership and that leaders need to adapt their style to suit the circumstances. Super leadership, a concept introduced by Charles Manz and Henry Sims, goes beyond traditional views of leadership by suggesting that everyone within an organization has the potential to be a leader. Super leaders focus on empowering others to lead themselves and create a culture of shared leadership where everyone takes ownership of their actions and contributes to the overall success of the organization. The statement "management philosophy controls practice" suggests that the beliefs and assumptions held by managers about employees (whether they align more with Theory X or Theory Y) can influence their leadership style and ultimately the practices and culture within an organization. Managers who adhere to Theory X principles are likely to adopt a more controlling and directive leadership style, whereas those who embrace Theory Y are more likely to adopt a participative and empowering style. This highlights the importance of aligning management philosophy with leadership practices to create a positive and productive work environment. 5. Think of situations in which you were a leader. What leadership style did you use? Using hindsight and the material in this chapter, what would you have done differently? Students’ answers may vary. There are numerous styles of leadership and students will be likely to mention autocratic, participative, and consultative styles most often. Many will probably say that they were too autocratic in their first attempts at leadership, and would tend to be more participative if they had it to do over. In various situations where I've been a leader, I've often used a participative leadership style. I believe in involving team members in decision-making processes, encouraging open communication, and fostering a collaborative environment where everyone's opinions are valued. This approach has generally been effective in promoting engagement and creativity within the team. However, reflecting on these experiences and considering the material in the leadership chapter, there are a few things I would do differently. Firstly, I would pay more attention to situational factors and adapt my leadership style accordingly. While a participative approach is effective in many cases, there may be situations where a more directive or coaching style would be more appropriate based on the nature of the task and the readiness of the team members. Secondly, I would work on improving my emotional intelligence and empathy as a leader. Understanding the emotions and perspectives of team members is crucial for effective leadership, and I believe there have been instances where I could have been more attuned to the needs and feelings of those I was leading. Lastly, I would strive to provide more regular and constructive feedback to team members. Feedback is essential for personal and professional growth, and I realize that I could have been more proactive in providing timely and specific feedback to help team members improve their performance. Overall, while I believe my leadership style has been generally effective, there is always room for improvement. By reflecting on past experiences and integrating the concepts and theories from the leadership chapter, I hope to continue growing and evolving as a leader. 6. The contingency models are all more complex than the earlier trait or “one best way” approaches. Discuss the likelihood that practicing managers will understand, accept, and use each of the contingency models. Students’ answers may vary. Many managers, it is true, try to avoid complexity if at all possible. More and more managers today agree that there are no simple, global answers to complex issues like leadership. As they manage a more and more diverse workforce as time goes on, these managers recognize that different subordinates react better to different leadership styles. While the Fiedler model and the path-goal model appears quite complex to many managers, the Hersey and Blanchard approach is more easily grasped. Most managers quickly recognize that matching leadership style to the development level of the subordinate(s) can be done, and makes good sense to do, as well. Also the model allows for different leadership styles to be used with the same employees on tasks with which the employees are less experienced. This has a certain commonsense appeal to many managers. The contingency models of leadership, such as Fiedler's Contingency Model, Hersey and Blanchard's Situational Leadership Theory, and the Path-Goal Theory, are indeed more complex than earlier trait-based or "one best way" approaches to leadership. These models recognize that effective leadership depends on various situational factors, such as the characteristics of the followers, the nature of the task, and the organizational context. The likelihood that practicing managers will understand, accept, and use each of the contingency models varies based on several factors: 1. Complexity of the Model: Some contingency models, such as Fiedler's Contingency Model, are relatively complex and require a deep understanding of concepts such as leader-member relations, task structure, and position power. Managers may find these models challenging to understand and apply in practice. 2. Relevance to the Situation: The perceived relevance of a contingency model to the manager's specific situation can influence its acceptance and use. If a manager believes that a particular model provides valuable insights into their current leadership challenges, they are more likely to embrace it. 3. Managerial Experience and Training: Managers with more experience and training in leadership theory and practice may be more open to and capable of understanding and using contingency models. They may also have a better grasp of the nuances of different leadership styles and when to apply them. 4. Organizational Culture: The culture of an organization can also impact the acceptance and use of contingency models. Organizations that value innovation and adaptability may be more open to adopting new leadership approaches, while more traditional or hierarchical organizations may prefer more conventional leadership styles. 5. Support and Resources: Managers are more likely to use contingency models if they have access to resources such as training programs, coaching, and tools that help them apply these models in their day-to-day leadership practices. In conclusion, while contingency models offer valuable insights into the complexities of leadership, their acceptance and use by practicing managers may vary based on factors such as complexity, relevance, experience, organizational culture, and available support and resources. To increase the likelihood of managers understanding, accepting, and using these models, it may be beneficial to provide training, create a supportive organizational culture, and emphasize the practical application of these models in real-world leadership scenarios. 7. Consider the various substitutes for leadership and enhancers. Identify the three that you think have the greatest potential for positive impact, and explain why. Students’ answers may vary. Presence of such substitutes as strong subordinate experience, clear rules, or a cohesive work group helps decrease the need for a leader’s traditional task orientation. Other factors, such as intrinsically satisfying tasks, professional orientations by employees, or an employee’s high need for independence, may diminish the need for a leader’s consideration-oriented behavior. Students will undoubtedly mention most of the substitutes and enhancers shown in Figure 7.8. Most will probably mention the enhancers, as they provide clear avenues to increased influence for the leader, and often arise from scenarios from everyday life. Most students know of a situation in which a leader has become widely known as the result of crisis management, or use of superordinate goals, for example. Substitutes for leadership are factors that can replace or reduce the need for a leader's direct involvement in influencing followers. Enhancers, on the other hand, are factors that can increase the effectiveness of leadership. Identifying the three substitutes and enhancers with the greatest potential for positive impact involves considering their ability to improve organizational outcomes and enhance employee satisfaction and motivation. 1. Substitutes for Leadership: a. Task Characteristics: When tasks are routine, well-structured, and intrinsically motivating, they can act as substitutes for leadership. Employees are more likely to be self-directed and motivated to complete such tasks without requiring close supervision. b. Organizational Culture: A strong, positive organizational culture that emphasizes shared values, norms, and beliefs can act as a substitute for leadership. Employees are guided by the culture to make decisions and behave in ways that align with the organization's goals and values. c. Employee Self-Leadership: Empowering employees to take control of their own work processes, set goals, and solve problems can act as a substitute for traditional leadership. Self-leadership fosters a sense of ownership and responsibility among employees. 2. Enhancers of Leadership: a. Transformational Leadership: Transformational leadership enhances the motivation, morale, and performance of followers by inspiring them to transcend their own self-interests for the good of the organization. This style of leadership can have a profound positive impact on organizational culture and performance. b. Employee Engagement: When leaders actively engage with their employees, listen to their concerns, provide feedback, and recognize their contributions, it enhances employee satisfaction, motivation, and commitment to the organization. c. Authentic Leadership: Authentic leaders are genuine, transparent, and self-aware. They build trust with their followers by being true to themselves and their values, which can create a positive organizational climate and improve employee well-being. Of these substitutes and enhancers, the three with the greatest potential for positive impact are transformational leadership, employee engagement, and a strong organizational culture. These factors have been shown to improve employee morale, productivity, and organizational performance, ultimately leading to greater success and sustainability for the organization. 8. Vroom’s decision-making model assumes that managers have the flexibility to shift from one style to another, whereas Fiedler’s model does not. Debate the feasibility of these models. Students’ answers may vary. Students may have difficulty accepting the applicability of the Vroom model. While they may generally agree that a leader can change styles, at least between two or three similar styles, they may question whether a manager can successfully switch among so many different styles. Some students may also be daunted by the manager to determine the correct style, and will question whether a manager can (or will) take the time to make all those estimations, or would prefer just to plunge ahead with his or her decision. However, it must be stressed that the model has been used with some success in settings where all three of the model’s assumptions were met. Fiedler’s model suggests that managers modify their leadership style to match the overall situation requirements. If the manager is unable to switch styles, it offers the option of modifying his/her job in order to obtain a better fit with their preferred style. Vroom's decision-making model and Fiedler's contingency model of leadership offer contrasting perspectives on the flexibility of managerial styles. Vroom's model assumes that managers can adapt their decision-making style based on the nature of the decision, the importance of obtaining subordinates' input, and the time available for making the decision. This suggests a high degree of flexibility, where managers can shift between a more autocratic or consultative style depending on the situation. On the other hand, Fiedler's model suggests that leadership style is relatively fixed and depends on the leader's personality traits. According to Fiedler, a leader's style is determined by their least preferred coworker (LPC) score, which reflects their basic leadership orientation. This implies that managers do not have the flexibility to change their leadership style easily and that their style is relatively stable across different situations. In debating the feasibility of these models, it is important to consider the complexity of human behavior and the dynamic nature of organizational environments. While Fiedler's model may accurately capture certain aspects of leadership, such as the influence of personality on leadership style, it may oversimplify the ability of leaders to adapt to different situations. In reality, effective leaders often demonstrate a degree of flexibility in their approach, recognizing that different situations may require different leadership styles. Vroom's model, with its emphasis on situational factors and the importance of obtaining subordinates' input in decision-making, may offer a more nuanced view of leadership flexibility. It recognizes that effective leaders are able to assess the demands of a situation and adjust their approach accordingly, rather than being constrained by a fixed leadership style. In practice, both models may have merit, but it is important for managers to recognize the limitations of each and to develop a leadership approach that balances flexibility with consistency and authenticity. Effective leadership often involves a blend of different styles, tailored to the needs of the situation and the individuals involved. 9. Why would a typical manager attempt to create independent-thinking employees? Would this competition between manager and employees eventually result in the loss of the manager’s job if the attempt were fully successful? Why or why not? Students’ answer will vary. Typical managers might not attempt to create self-leading employees, although they might not actually refrain from fear of losing their jobs. They may feel that such encouragement might undermine their authority as managers or the dependence upon them that they may believe their subordinates have. A typical manager would attempt to create independent-thinking employees for several reasons. Firstly, independent-thinking employees are more likely to take initiative, solve problems creatively, and contribute innovative ideas to the organization. This can lead to improved decision-making, increased productivity, and a more adaptable and competitive organization. Secondly, fostering independent thinking among employees can lead to a more empowered and engaged workforce. When employees feel that their ideas are valued and that they have the autonomy to make decisions, they are more likely to be motivated and committed to their work. Additionally, creating independent-thinking employees can reduce the burden on managers by empowering employees to take ownership of their work and make decisions without constant supervision. This can free up managers' time to focus on more strategic tasks and responsibilities. As for the question of whether this competition between manager and employees would eventually result in the loss of the manager's job if the attempt were fully successful, the answer is not necessarily. While it is true that highly independent and capable employees may require less direct supervision, this does not mean that the role of the manager becomes obsolete. Managers play a crucial role in providing direction, setting goals, aligning individual efforts with organizational objectives, and providing support and guidance to employees. Even in a scenario where employees are highly independent thinkers, managers are still needed to provide leadership, coordination, and oversight to ensure that organizational goals are met. In fact, a manager who successfully creates a team of independent-thinking employees may be seen as a strong and effective leader, capable of developing and nurturing talent within the organization. Such a manager is likely to be valued for their ability to empower and motivate employees, rather than viewed as redundant. Overall, creating independent-thinking employees can benefit both the manager and the organization as a whole, leading to a more innovative, engaged, and productive workforce. 10. Review the idea of the leader as a coach. Which of the leadership models relates more closely with coaching? Explain. Students’ answers may vary. A rapidly emerging metaphor for the leader is that of a coach. Coaching means that the leader prepares, guides, and directs the team but does not play the game. Coaches see themselves as cheerleaders and facilitators, while also recognizing the occasional need to be tough and demanding. Hersey and Blanchard’s situational model specifically relates to coaching. As the subordinates mature, the leadership style changes from telling to delegating. Participative leadership style of the path-goal model also relates to the coaching metaphor. The idea of the leader as a coach emphasizes a leadership approach that focuses on developing and empowering employees to reach their full potential. A leader who adopts the coaching role acts as a mentor and guide, providing support, feedback, and encouragement to help employees grow and succeed. One of the leadership models that relates closely to coaching is the transformational leadership model. Transformational leaders inspire and motivate their followers by articulating a compelling vision, setting high expectations, and providing support and encouragement to help them achieve their goals. This leadership style is similar to coaching in that it involves building strong relationships, providing guidance and feedback, and empowering employees to take ownership of their development and performance. Transformational leaders also demonstrate key coaching behaviors, such as active listening, empathy, and the ability to provide constructive feedback. By fostering a culture of continuous learning and development, transformational leaders can help create a motivated and engaged workforce that is committed to achieving both individual and organizational goals. Assess Your Own Skills Students should honestly circle the number on the response scale that most closely reflects the degree to which each statement accurately describes them as leaders. This section will help them understand how well they exhibit good leadership traits. Incident The Work Assignment Pardini is definitely a supervisor in the middle. She receives pressures from management to complete assignments, but also she receives pressures from employees, such as Prosser, who do not want to do the work assigned. In this instance, a specific act by Prosser has characteristics of insubordination, and it is involving other employees, because they are observing what is happening. This kind of challenge to Pardini cannot be ignored. It can be argued that Pardini should be more considerate, supportive, and participative in her supervision. Certainly this approach offers some promise for the long run. For example, perhaps Pardini could discuss major assignments with her employees before she made them, or perhaps an employee committee can advise her regarding policies for major assignments. Although the considerate approach offers promise for the long run, an immediate problem faces Pardini. What should she do now? From a perspective of power, Pardini needs to regain control of the workplace. She could try to direct power play by verbally reprimanding Sonia or threatening to fire her. However, as noted in the book, these are very risky strategies. Sonia may not accept the reprimand and could turn the discipline into a heated argument. She might also protest any threat or action to fire her through a grievance procedure and win. Thus, Pardini could lose rather than gain power. A more effective strategy, it would seem, would be for her to tell Sonia that she would like to meet with her. Then, after selecting a private place away from the other employees, she should listen to Sonia’s side of the story. If Sonia’s arguments have merit and appear justified, Pardini should attempt to “mend fences” by allowing Sonia a more preferred activity at a later time. If Sonia’s grievances are not warranted, that also needs to be pointed out and consequences for continued insubordination should be outlined. However, Pardini should still allow Sonia some way of “saving face” with the other employees. From a path-goal perspective, Sonia may perceive Pardini as a barrier to her goal of more preferred tasks. Pardini might help Sonia by clarifying the contingencies (the path) that lead to preferred jobs (goal). Sonia might believe, for example, that she has more experience or better quality of work than other employees when she does not. Using Fiedler’s contingency model, it can be argued that this situation falls into Octant VIII. Leader-member relations are poor with Sonia, the task appears somewhat unstructured, and leader position power does not appear to be strong. (If it were strong, Sonia would hardly take the risk she is taking.) These conditions define Octant VIII, which calls for task-oriented leadership that firmly instructs Sonia to do her work. This approach can, of course, be done in a considerate way in the privacy of Pardini’s office. Task performance needs to be restored, but consideration will be helpful in handling the situation and getting to the root of the larger problem, for its long-run solution. It should be noted that the above approaches are not necessarily in conflict with each other and that, depending upon what Pardini finds out in her conversation with Sonia, her final strategy may reflect and integrate all three approaches outlined above. Experiential Exercise Application of Leadership Models This exercise will help create an interesting group discussion for students to discuss their understanding of the concepts of leadership and its various models. This provides an opportunity to actually apply what they learnt from the chapter. 1. Divide into small groups of five to seven persons. 2. Select, as a focus of discussion, a visible leader with whom all members are reasonably familiar (e.g., your college’s president, a local mayor, the state governor, or a major corporation’s CEO). 3. Each group member should choose a different leadership model and relate it to that leader. Spend a few minutes explaining to the other group members how: a. Your model applies to that leader b. Your model fails to apply neatly to that leader and why 4. Hold a brief discussion to explore ways in which the models are similar, different, and potentially complementary to each other. 5. Derive a set of action implications for yourselves as future leaders, based on this discussion. For this exercise, let's consider a visible leader such as a local mayor. We'll imagine ourselves in a small group discussing different leadership models in relation to the mayor's leadership style. 1. Transactional Leadership: One group member might choose transactional leadership and argue that the mayor uses rewards and punishments to motivate citizens. For example, the mayor might offer tax incentives for businesses that relocate to the city. 2. Transformational Leadership: Another member might choose transformational leadership and argue that the mayor inspires citizens with a vision of a better future. The mayor might use rhetoric and community projects to engage citizens in improving the city. 3. Situational Leadership: A third member might choose situational leadership and argue that the mayor adapts his leadership style based on the situation. For example, he might be more authoritative during a crisis but delegate more during times of stability. 4. Servant Leadership: Another member might choose servant leadership and argue that the mayor prioritizes the needs of the citizens above his own. He might be actively involved in community service projects and seek input from citizens on policy decisions. 5. Charismatic Leadership: Lastly, a member might choose charismatic leadership and argue that the mayor possesses a magnetic personality that inspires trust and loyalty in citizens. His ability to connect with people on a personal level helps him rally support for his initiatives. In the discussion, we might find that while each model offers a different perspective on the mayor's leadership style, there are also overlaps and complementary aspects. For example, the mayor might exhibit traits of both transactional and transformational leadership, using rewards to motivate citizens while also inspiring them with a vision for the future. As future leaders, we can derive several action implications from this discussion. We might learn the importance of adapting our leadership style to different situations, prioritizing the needs of those we lead, and inspiring others with a compelling vision. We can also see the value in combining different leadership models to create a well-rounded and effective leadership approach. Generating OB Insights Students’ responses will vary for this exercise. They should however, highlight several of the major topics discussed in the chapter such as the nature of leadership and followership, the difference between traits and behaviors, different leadership styles, early approaches to leadership, etc. Solution Manual for Organizational Behavior: Human Behavior at Work John W. Newstrom 9780078112829, 9781259254420