The Distinction Between Leading and Managing - Literature review Example

Introduction Demographic changes, developments in technology and market strategies that occurred throughout the 1990s – early 2000s resulted in grave changes that affected virtually all aspects of a organizational functioning. The most evident and celebrated of these changes are never yet seen dynamics of the business and the increased attention to the human resource issues with the companies tending to rely more on skilled and motivated personnel then on technologies and production. As Steve Jobs, legendary CEO of Apple Computers, reasonably noted technologies may be stolen and products may be faked by competitors, so the only way to sustain the company’s competitive advantage in such environment is to invest in its personnel. Skilled, loyal and motivated employees remain perhaps the only reliable asset and competitive advantage of modern companies. Consequently, attracting skilled labor and career oriented employees and retaining them in the constantly changing dynamic environment is perhaps the most evident challenge to be faced by modern businesses. Strong and effective leadership is the vital aspect of HRM required to manage the recent changes. Leadership is an exceptionally complex phenomenon: the recent explosion of scholarly literature covering various aspects of leading and managing people is one logical outcome of this complexity. Despite huge amount of books and articles dedicated to the issue, there is still a great deal of ambiguity surrounding the true meaning of effective leadership in contemporary organizational environment. Main Body In psychology the phenomenon of leadership has traditionally been associated with in-group dynamics of social interactions. In any group, regardless of its size, members differ in their degree of social influence over one another: “… the person who exerts the most influence on the rest of the group thus affecting group beliefs and behavior is usually addressed as leader” (Hollander, 1985: 14). Although this definition of leadership allows the reader to grasp the essence of leadership, it is only one of the numerous of definitions that have been proposed in the existing literature (Northhouse, 2004). Absence of agreement between the scholars is partially due to different methods utilized to explore the phenomenon; partially due to varied purposes of defining leadership; and partially due to the variations in theoretical approaches. There are several major approaches in leadership studies: leadership as the focus of group processes, as personality attribute, as the art of inducing compliance, as an exercise of influence, as a particular kind of act or behavior, as a form of persuasion, as a power relationship, as an instrument of goal achievement, as an emerging effect of group interaction (‘leadership exists when it is acknowledged or conferred by other members of the group), as a differentiated role, as the initiation or maintenance of role structure, or as some combination of all these approaches (Bass, 1990: 6-10). The second edition of The Handbook of Leadership by Bass lists more than 130 definitions of leadership (Bass, 1985: 12). Absence of agreement between the scholars is partially due to different methods employed to explore the phenomenon, partially due to varied purposes of defining leadership, and partially due to the variations in theoretical approaches. Bass specifies 13 major approaches: leadership as the focus of group processes, as personality attribute, as the art of inducing compliance, as an exercise of influence, as a particular kind of act or behavior, as a form of persuasion, as a power relationship, as an instrument of goal achievement, as an emerging effect of group interaction (‘leadership exists when it is acknowledged or conferred by other members of the group), as a differentiated role, as the initiation or maintenance of role structure, or as some combination of all these approaches (Bass, 1985: 6-10). Trait Approach One of the earliest approaches to understanding leadership was to search for personality traits that caused some people and not others to become leaders. As a result, early definitions (beginning and first half of the 20th century) tended to view leadership as an innate personal quality of the leader, in line with such highly individual qualities as sense of humor, persistence, or piety. Following this tradition, researchers specified certain traits that made leaders. Some of these were intelligence, achievement, responsibility, participation, status, high self-confidence, energy, initiative, emotional maturity, stress tolerance, belief in internal locus of control, pragmatism, result orientation, knowledge, and fluency of speech. Even physical characteristics, such as height, weight, and features have been sometimes viewed as factors that make leaders (Bass, 1990; Yukl, 1989). Bass lists around 300 studies which aimed to identify the unique qualities that make leaders. Some of these studies provide the reader with huge inventories of ‘leader’s’ traits: thus, one study published in 1940, included a list of 79 items (Madsen, 2001). The trait approach was put in question long ago. Machiavelli was arguably the first thinker who argued that leadership was rather a relationship between leaders and their followers than a sum of inborn personal characteristics. The recent variant of the trait approach also does not go to extremes, and rather aims to identify such combinations of personal characteristics that help individuals carry out leadership functions. Thus, Yukl summarizes the contemporary shift in the trait approach as follows: ”The focus of much of the recent trait research has been on managerial motivation and specific skills, whereas earlier research focused more on personality traits and general intelligence. Some researchers now attempt to relate traits to specific role requirements for different types of managerial positions” (Yukl 1989: 260). Howard Gardner (1987) proposes a very interesting variation of the trait theory. Instead of focusing upon inborn characteristics of leader, Gardner argues that much of the leader’s traits can be taught and learned. Therefore, Gardner specifically investigates personal development and education of leaders, and claims that educational experience plays critically important role in their becoming leaders (Gardner, 1987). Yet, further research is required to support this very interesting and promising theory. Skills and Behavior Approach Behavior approach postulates that the leader does not necessarily possess unique personal characteristics; instead, it focuses upon the nature of managerial work performed by the leader. This approach emerged in the first half of the last century and apparently owes a debt to increased influence of behaviorism on psychological research. The key difference that distinguishes the behavior approach from the trait theory is the notion that leader’s behavior can be learned and changed through practice – a person can be trained to become leader (Bass 1990; Madsen, 2001). Psychologists at Ohio State and the University of Michigan conducted pioneering research in the behavioral understanding of leadership. Thus, Stogdill et al. (1948) asked employees to evaluate numerous aspects of behavior characteristic to their leader and indicate to which degree a specific statement in the questionnaire reflected the behavior of their leader. Based upon a series of similar studies, Stogdill argued that there were two different kinds of leader behaviors – “initiating structure” (task-oriented) and “consideration” (relation oriented) – and defined leadership as “the initiation and maintenance of structure in expectation and interaction” (Stogdill, 1974: 15, cited in Madsen, 2001: 12). Despite certain achievements, skill and behavioral theory of leadership largely failed to fully explain or accurately predict behavior of leaders (Melcher, 1977: 95). Yet the behavioral approach has considerable practical value. Thus, one of the most popular models of effective leadership developed by James M. Kouzes and Barry Z. Posner (2003) is based upon the research of leaders’ behavior. The authors list five fundamental practices and ten commitments observed in successful leaders: I. Challenging the Process: Search for Opportunities + Experiment and Take Risks II. Inspiring a Shared Vision: Envision the Future + Enlist Others III. Enabling Others to Act: Foster Collaboration + Strengthen Others IV. Modeling the Way: Set the Example + Plan Small Wins V. Encouraging the Heart: Recognize Individual Contribution + Celebrate Accomplishment. Within the framework of this model leadership is defined as “the art of mobilizing others to want to struggle for shared aspirations” (Kouzes and Posner, 1995, p.30). Based upon analysis of leader’s behavior, Yukl (1989) specified several leadership skills that make a good leader. These skills fall into four broad areas: relationship building (networking and managing conflict), influencing people (motivating and persuading others), decision making (planning, solving problems, and consulting), and effective communication (controlling information flows within group, listening, and clarifying). The well known five-element TEACH (Technical, Ego-management, Administrative, Conceptual and Human relations skills) model of leadership used for training of potential leaders apparently owes a debt to Yukl’s research. A series of works published over the last decade by Goleman (1995), Gardner (1993), and Sternberg (1988) are usually addressed as the “leadership intelligence” theory. These authors argue that successful leaders possess a wide variety of specific ‘leadership’ skills with various forms of intelligence being the key factors that make a good leader. Thus, Sternberg specifies analytic, practical and creative forms of intelligence, while Gardner and Goleman pay particular attention to the “intrapersonal” intelligence. These forms of intelligence are impossible to measure with the help of IQ tests because they comprise a number of sub-skills, such as empathy, excellent communicability, ability to manage conflicts, high-adaptability, innovative thinking, etc., etc. Goleman (2000) indicates the following fundamental elements of the ‘intrapersonal’ intelligence: 1. Self-Awareness (including the ability to read and understand your emotions, a realistic evaluation of your strengths and weaknesses, and a strong and positive sense of self-worth.) 2. Self-Management (including the ability to keep your emotions under control, a consistent display of honesty and integrity, the ability to manage yourself, skill at adjusting to changing situations, the drive to meet an internal standard of excellence, and a readiness to seize opportunities) 3. Social Awareness (including empathy with other people’s emotions, the ability to read the currents of organizational life, build decision networks, and navigate politics, and the ability to recognize and meet customers’ needs); 4. Social Skill (including visionary leadership, ability to influence others, developing other people’s skills, skill at listening and at sending clear, convincing, and well tuned messages, proficiency in initiating new ideas and leading people in new directions, managing conflict, proficiency at cultivating and maintaining a web of relationships, and competence in building teams) (Goleman, 2000: 80-82). This model illustrates the major drawback of the skill approach which is similar to the core limitation of the trait perspective: the person’s ability to lead is associated with some ambiguous skills. Poor measurability of such skills and absence of a standardized scale contributes to failure of this approach as well. Contingency Approach The contingency approach (also referred as the situational approach) to understanding of leadership can be addressed as the most comprehensive and promising perspective on leadership. The contingency model first described in the 1960s incorporates a number of achievements from the previous research, and contends that people do not become effective leaders because they possess a unique combination of ‘leader’s’ traits but because the combination of traits they possess matches particular situational factors in a particular group. Thus, the combination of traits that makes leaders in the contingency model is contingent upon the circumstances encountered by the leader (Franzoi, 1996: 541). The contemporary contingency model is consistent with earlier research particularly emphasizing the situational variable. In 1966, A. Korman surveyed about 30 most comprehensive works on leadership, and discovered that while proposing various definitions of leadership and making assumptions as for its nature and core features, no research was available to predict effectiveness of a leader in a changing environment (Hersey and Blanchard, 1995: 148). Korman reasonably concluded that situational variable strongly impacts the leader’s behavior and style of leadership. Such view is also confirmed by a series of other studies reporting specific situations do influence the leader’s behavior (Madsen, 2001). Fiedler’s Model Fred Fiedler’s contingency theory offers another credible explanation of the leadership phenomenon. Fiedler outlines two basic types of leaders: task-oriented and relationship oriented. A task-oriented leader is one who gives highest priority to getting the work of the group accomplished and is much less concerned with the relations among group members. By contrast, relationship-oriented leaders assign highest priority to group relations, with task accomplishment being of secondary concern (Franzoi, 1996: 541). Fiedler (1972) emphasizes three basic elements combination of which determines favorableness of the situation for leaders. These are the leader-member relations, the position-power and the task structure. Various combinations of these elements require diverse types of leaders, and Fiedler argues that task-oriented leaders are more effective in situations of high or low favorableness, while relation-oriented leaders have better chances to achieve success in situations of intermediate favorableness (Fiedler, 1972). In order to identify the leadership style, Fiedler proposes a simple method called the Least Preferred Coworker Scale (LPC), which measures the attitudes leaders express about their least preferred co-worker (leaders are asked to evaluate the person in the group they like least). Using this method Fiedler has found out that leaders with a low LPC score (those who tended to evaluate the least preferred co-worker very negatively) were task-oriented, while leaders with a high LPC score (those who were moderate or positive in their evaluation of the least preferred co-worker) were relationship-oriented (Fiedler, 1972). Although Fiedler’s model has been much criticized for oversimplification, subjectivity, and great deal of ambiguity, a series of later studies of LPC scale showed that data supported this value-attitude towards task or interpersonal success (Madsen, 2001). Transactional and Transformational Leadership Model In 1978, James McGregor Burns introduced a concept of transformational and transactional leaders. Burns assumes that leadership is a relationship between leaders (proposed by Machiavelli) claiming that it implies an interchange between the leader and the followers. Burns proposes to distinguish between two broad types of leadership: transactional where the leader is meeting the simple needs of his followers, while the latter respond with cooperation and transformational, which is more complex (Burns, 1978). The key difference between transactional and transformational leadership is value setting: transactional leaders are more concerned with short-term goals (e.g. honesty and fairness), while transformational leaders are focused on such ultimate values as equality and justice. Correspondingly, transformational leaders have more potential to satisfy their followers than transactional leaders. Besides, successful transformational leadership leads to the elevation of the followers, while transactional leadership keeps both the leader and the followers in their place (Burns, 1978). Bass (1990) relies and elaborates on the Burns’ ideas to produce the Full Range Model of Leadership which includes three leadership styles: transactional, transformational, and non-leadership. Acknowledging the fact that transformational leaders exert more influence on their followers than transactional leaders or non-leaders, Bass argues that neither of these styles can be met in the pure form: any leader exhibits a combination of styles. Based upon his empirical studies of effective leaders, Bass claims that there is an optimal combination that makes leaders successful and effective (Bass 1994). Although he can hardly be referred to as advocate of the traits approach, Bass particularly emphasizes the importance of charisma for transformational leaders though admitting that charisma alone is only an element, though important, of effective transformational leadership, while being a true leader requires a wide variety of other qualities, not necessarily inborn. The ability to respect and empower the followers is another critically important element that distinguishes effective leaders because leadership is a process shared between the leader and the followers (Bass 1994; Yukl 1989). Therefore, definition of leadership proposed by Bass is rather broad for it aims to reflect all characteristics outlined by the author: “Leadership is an interaction between two or more members of a group that often involves a structuring or restructuring of the situation and the perception and expectations of the members … Leadership occurs when one group member modifies the motivation or competencies of others in the group … any member of the group can exhibit some amount of leadership and the members will vary in the extent to which they do so” (Bass, 1995: 11). Koehler and Pankowski (1996) move beyond the simplistic model of one-way influence between the leader and the followers to argue that effective leadership in organizations is not confined to just making the followers obey orders and instructions. A leader rather “enables the followers as individuals and teams to act in the best interest of the mission, goals, and objectives of the organization” (Koehler and Pankowski, 1996: 16). Correspondingly, leadership is a set of practices aimed at achieving this goal – empowering the followers to do their best. Bass’s works are particularly important because he was among the first researchers who attempted to analyze the organizational implications of leadership. Yet, although works of Burns and especially Bass have stimulated renewed interest in the trait theory, they, in fact, cover only a small number of leaders. Bass himself admits that transformational leaders usually emerge during times of social and political crises, while emergence of leaders in times of stability still has to be properly explained (Bass, 1985). Visionary Leadership Theory The central idea of the visionary leadership is about envisioning the organization’s position for long-term future, conveying this vision to other members of the organization, motivating individuals to share and commit to this vision, and aligning resources and processes to accomplish it (Young, 2003). As Cheryl Mabey, a contemporary researcher of leadership, claims, the “… vision theory is …. a premier view of the 1990s and the beginnings of the 21st century wherein the main thrust of the leader is to formulate the future direction of an organization, private or public in nature, and to communicate that vision to others” (Mabey, 1995: 312). Three scholars have shared the credit for formulating the basic concepts of the visionary perspective. Sashkin (1989) views visionary leadership as a sum of the leader’s personal characteristics, behavior, and situational factors and the system of relationships between these variables: “Visionary leaders share certain characteristics that are different from personality traits on which early leadership focused … they have a deep, basic awareness of key situational factors that dictate what leadership approach and actions are required … [they] not only know what behaviors are required, they can also carry out those behaviors” (Sashkin and Wren, 1995: 403). Thus, a visionary leader is a person who establishes a vision or ideal image of the organization and its culture, and constructs a coherent and logic philosophy that describes the vision and develops methods to attain this practice taking into consideration all factors that can potentially affect it. Besides, a leader engages on a one-to-one basis with others to initiate and gain support for the vision (Young, 2003). Nanus (1994) further detailed the concept of visionary leadership claiming there are no more powerful engine driving an organization toward excellence and long-range success than an attractive, worthwhile, and achievable vision of the future, widely shared by all members of the team. Therefore, effective leaders have agendas, are result-oriented, adopt challenging new visions of what is both possible and desirable, communicate their visions, and persuade others to become so committed to these new directions that they are eager to lend their resources and energies to make it happen. Stephen Harper (2001), the most recent contributor to the visionary leadership approach, notes that determining the company’s vision may be the most important role a ‘breakthrough’ leader can play in creating a forward-focused company. The vision serves three purposes which equally contribute to its importance: Orientation – all decisions, plans, and activities should be directed toward fulfilling the company’s vision. Second, the vision must be compelling. It should give each person in the company a reason to jump out of bed in the morning. Third, the vision can serve as the glue that binds all the company’s components together. Carlo Burmat, dean of the Duxx Graduate School of Business Leadership in Monterey, Mexico, noted that the role of visioning plays in fostering a collaborative environment. He stated, “Each of us has a fragmented view of how the world works. The leader’s role is to put together and harmonize such views, because only by associating minds in this way can you acquire a full and objective view of the world” (Harper, 2001: 30-31). Although Harper substitutes the term ‘visionary leader’ with the ‘breakthrough leader’, the essence of his functioning is apparently visionary. Harper postulates that a vision emerges as a result of understanding organizational, employees’, stakeholders’, customers, and suppliers needs and desires. Each of these groups is equally important to the success of the leader (and correspondingly organization). Harper admits the possibility of several futures for the organization, and which one will become true largely depends upon the leader, his discretion and the application of organizational components, as well as pressures from the external environment (Young, 2003). Once a vision is articulated, everyone involved in bringing about its realization should accept and understand the same vision. The leader has a responsibility to put this vision all together in a cohesive and understandable form or image of the future: “Through the power of persuasion, the leader keeps the vision alive and interesting, something which unequivocally has merit and is worthy of effort. [To effectively perform this task] visionary leaders must be courageous (bold, willing to take risks, and desirous of letting go of the past), resilient (firm in some cases and flexible in others), and decisive (possess a sense of urgency, be earnest and resolute) (Harper, 2001: 34). Visionary Leadership and Roles Theory Visionary leadership has a potential for viewing the processes of leadership from the positions of role theory. Introducing the notion of forces that make a visionary leader, Burt Nanus (1992) have formulated the roles of visionary leaders: 1) direction setter, 2) change agent, 3) spokesperson, and 4) coach. The first visionary leadership role – direction setter – Nanus (1992) discusses as necessary to being effective is the direction setter. The direction setter role is one where a leader presents a vision, a convincing image or target for an organization to achieve in the future, and involves people from the get-go: “As a direction setter, a leader presents a vision, communicates it, motivates worker and colleagues, and convinces people that it is the right direction to proceed and encourages participation on all levels and at all stages of progress towards the vision” (Nanus, 1992: 13). The second role - change agent – requires the leader to be capable of implementing change; this ability is vitally important for contemporary organizations taking into consideration changeability of the external environment. Economic, social, technological, and political changes occur continuously, some dramatic and others subtle in nature. Indeed, customer needs and preferences change as do those of other organizational stakeholders: “Effective leaders must be constantly attuned to these changes and think ahead to potential changes and changeability. This ensures that the leader is prepared for any situations or circumstances that may threaten organizational success for the present and, most importantly, for the future” (Young, 2003: 10). The third role of a visionary leader – spokesperson – is not less important that the previous two: it is central for effective sharing of the leader’s vision (goals, objectives, intentions, etc) among the subordinates: “An effective leader is also a person who knows and appreciates the many available forms of communication available in explaining and building support for a vision of the future. The leader, as spokesperson for the vision, must communicate a message that strikes the right chord with everyone involved with or touched by the organizational vision—internally and externally. It must be a message which is “worthwhile, attractive, and exciting about the future of the organization” (Nanus, 1992: 14). And finally, an effective visionary leader should also be capable of acting out as a good coach. Using this term Nanus implies that a leader must use teamwork to attain the stated vision and goals. A leader empowers his or her “players” to work together, to coordinate their efforts or activities, toward “winning” or achieving an organizational vision. The leader, as coach, keeps people focused on realizing the vision by directing, encouraging, and building trust among the many players that are crucial to an organization and its vision of the future. In some cases, it can be argued that the leader as coach, might more appropriately be designated a “player-coach.” This would be a leader who, like the legendary Boston Celtic’s Bill Russell, or perhaps a Michael Jordan, both “played as well as coached.” Today’s corporate examples or equivalents would include Microsoft’s Bill Gates, Amazon’s Jeffery Bezo, or Apple’s Steve Jobs (Young, 2003). Conclusion The variety of views on distinction between leading and managing is almost the same as the number of theories that explore leadership phenomenon. However, some of them deserve particular attention. For example, Kotter (1996) argues that leaders create vision and general strategies, while managers do more tactical planning. Leaders align group members onto the goals of the group and inspire them to persist in achieving these goals; managers divide the work into tasks and jobs and the people into departments and teams; they organize how the work will be done, and check on whether and how well it is being done. Managers are better at conserving the processes of the organization and leaders come in handy when the organization needs to face change; furthermore, managers may sometimes be good leaders and sometimes not, and some leaders may also be good managers and sometimes not. Leaders are perceived to be good in motivating personnel, while managers are seen as better at organization and control. In similar vein, Warren Bennis claims that “…the difference between managers and leaders is fundamental. The manager administers, the leader innovates. The manager maintains, the leader develops. The manager relies on systems, the leader relies on people. The manager counts on control, the leader counts on trust. The manager does things right, the leader does the right thing” (Bennis, 1988, p. 173). By contrast, Thomas argues, “…increasingly, the people who are the most effective are those who essentially are both managers and leaders” (Blagg, 2001: 33). In a more recent study, Bartlett, another well-known authority in this field, notes, “Good management is about achieving results through others and I think that it always encompassed leadership” (Doh, 2003: 65). John Kotter, a professor at Harvard Business School and probably the most known authority in leadership and management studies, is the author of many articles and several books which explain the nature of distinctions between the two processes. Kotter’s key idea is that while leadership involves the processes of developing vision and forward-thinking strategies, innovations, change, and empowering followers, management deals with the effective functioning of an organizational system, which includes planning, supervising, budgeting, organizing, controlling, staffing, etc. However, he also acknowledges that leading and managing are not mutually exclusive processes: a good leader can be an effective manager as well, while a good manager can be an effective leader to his or her subordinates (Kotter, 1996). The controversy is apparent. On the one hand, management and leadership should definitely be viewed as complementary processes; on the other hand, a number of differences between these two processes have been acknowledged by hundreds of reliable studies, which hardly leave any opportunity to simply neglect it. Despite lack of clarity on the issue, modern scholarly literature apparently leans toward more consolidated view on leadership and management because neither of existing approaches fully fits the set of effective leadership qualities required in the modern environment and neither of them can be used to effectively predict or reason behavior of an effective modern leader. Hence, one implication so far is that the traditional management and leadership dimensions need to be supplemented rather than opposed. WORKS CITED Bass, B. M. 1990, Handbook of Leadership: Theory, Research and Managerial Applications, New York: The Free Press. Bennis, W (1994). On Becoming A Leader. 2nd Edition. Addison-Wesley Pub Co. Burns, J. M. 1978, Leadership, New York: Harper & Rowe. Doh, J. P. (2003). Can Leadership Be Taught? Perspectives From Management Educators. Academy of Management Learning & Education, 2(1), 54-67 Fiedler, F. E. (1972). How do you make leaders more effective. In J. L. Pierce & J. W. 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