Lecture 7 Reading: Charismatic and Transformational Leadership Yukl (2006) ‘Charismatic and transformational leadership’, in Leadership in Organizations, Upper Saddle River: Pearson. DEFINITION: charisma occurs during a social crisis when a leader emerges with a radical vision that offers a solution to the crisis and attracts followers who believe in the vision (Weber, 1947) ‘Charisma’ describes a form of influence based not on tradition or formal authority but rather on follower perceptions that the leader is endowed with exceptional qualities DEFINITION: Transformational leadership appeals to the moral values of followers in an attempt to raise their consciousness about ethical issues and to mobilise their energy and resources to reform institutions (McGregor Burns, 1978) Transactional leaders on the other hand motivates followers by appealing to their self-interest and exchanging benefits Attribution Theory of Charismatic Leadership Conger and Kanungo (1987) proposed a theory of charismatic leadership based on the assumption that charisma is an attributional phenomenon Follower attribution of charismatic qualities to a leader is jointly determined by the leader’s behaviour, expertise and aspects of the situation Leader Traits and Behaviours Charisma is more likely to be attributed to leaders who advocate a vision that is highly different/conflicting from the status quo, but still within acceptance by followers Non-charismatic leaders support the status quo or only make incremental changes Charismatic leaders’ ways of achieving their vision must be unconventional in order to impress followers and has superior expertise Leaders viewed as charismatic when they make self-sacrifices, take personal risks and incur high costs to achieve the vision Followers more likely to attribute charisma to leaders who inspire them with emotional appeals than to leaders who use authority or a participative decision process Use of authority may gain more expert power if strategy is successful but unlikely to appear charismatic if they don’t justify the strategy with an ideological vision Followers who participate in the decision making process may be satisfied and motivated but the leader won’t appear extraordinary Charismatic leaders influence people to accomplish great things that they thought was impossible Leaders need to be sensitive to the needs and values of followers as well as to the environment Influence Processes Conger (1989): interviews conducted to explain why followers of charismatic leaders become so strongly committed to the task/mission Primary influence process is personal identification Influence derived from a follower’s desire to please and imitate the leader Leader approval becomes part of self-worth and leader approval instils a deeper sense of obligation to live up to leader’s future expectations Influence of a charismatic leader also due to internalization of new values and beliefs by followers Conger (1989) emphasized that it is more important for followers to adopt leader’s attitudes and beliefs about objectives and effective strategies than to merely imitate superficial aspects i.e. mannerisms, gestures Facilitating Conditions Contextual variables especially important for charismatic leadership Charismatic leaders more likely to emerge in crisis situations Unlike Weber (1947), Conger and Kanungo do not consider an objective crisis to be necessary for charismatic leadership A leader may be able to create dissatisfaction with current conditions and simultaneously provide a vision of a more promising future even in the absence of a genuine crisis The leader might create a crisis where one didn’t exist previously, setting the stage for demonstration of superior expertise like charismatic leaders show Self-Concept Theory of Charismatic Leadership House (1977): explanation of charismatic leadership in terms of a set of testable propositions involving observable processes Identifies how charismatic leaders behave, traits, and skills and conditions in which they are most likely to emerge Limitation: ambiguity about the influence processes Shamir, House and Arthur (1993): added new developments about human motivation Behaviour is expressive of a person’s feelings, values and selfconcept as well as being pragmatic and goal oriented Self-concept is composed of a hierarchy of social identities and values People are intrinsically motivated to enhance and defend their self-esteem and self-worth People are intrinsically motivated to maintain consistency among various aspects of their self-concept and between their selfconcept and their behaviour Indicators of Charisma Leader-follower relationship illustrates evidence of charismatic leadership Followers perceive that the leader’s beliefs are correct Willingly obey the leader Feel affection toward the leader Emotionally involved in the mission of the organisation High performance goals Believe that they can contribute to the success of the mission Attribution of extraordinary ability is likely, but not necessary for charismatic leadership Leader Traits and Behaviours Leadership behaviours that explain how a charismatic leader influences the attitudes and behaviour of followers: Articulating an appealing vision Using strong, expressive forms of communication Taking personal risks and making self-sacrifices to attain the vision Communicating high expectations Expressing confidence in followers Leading by example Managing follower impressions of the leader Building identification with the group or organisation Empower followers Influence Processes Sources of leader influence over followers: Social identification: when people take pride in being part of the group ad regard membership as one of their most important social identities (Ashforth and Mael, 1989); more willing to place the needs of the group above their own; results in strengthening of shared values, beliefs and behaviour norms; can also be increased by skilful use of symbols, rituals and ceremonies; story telling as a source of symbolic action Internalization: occurs when attainment of task objectives becomes a way for followers to express their values and social identities. Charismatic leaders articulate a vision describing task objectives in ideological terms that reflect follower values; ultimate form of internalization occurs when followers come to view their work role as inseparably linked to their self-concept and self-worth Augmentation of individual and collective self-efficacy: selfefficacy is the belief that one is competent and capable of attaining difficult task objectives; when collective efficacy is high, people are more willing to cooperate with members of their group in a joint effort. A leader can enhance the self-efficacy and collective efficacy of followers by articulating an inspiring vision, expressing confidence that they can accomplish the collective task and provide stimulation Facilitating Conditions Motivational effects of charismatic leaders more likely to occur when the leader’s vision is congruent with existing follower values and identities Should define task roles in ideological terms that will appeal to followers E.g. high-tech industries’ ideological appeals include scientific progress, economic development, etc. Work roles with low potential for ideological appeals includes simple, repetitive work with little inherent meaning/social significance A crisis condition is not necessary for the effectiveness of charismatic leadership but it is more likely to occur when a group/organisation is in serious trouble (Shamir et al.) However, unclear what must be done to ensure survival and prosperity and considerable anxiety or panic among members (e.g. Bligh, Kohles, & Meindl, 2004) Crisis conditions favour the emergence of a leader who can interpret the crisis and offer credible strategies for coping with it successfully BUT charismatic effects could be temporary unless the vision continues to be relevant after the immediate crisis is over (Boal & Bryson, 1988) Other Conceptions of Charisma Psychodynamic Processes Theorists attempt to explain the seemingly irrational influence of some charismatic leaders who are idolized Intense personal identification of followers with such leaders is explained in terms of psychodynamic processes such as regression, transference and projection Regression: return to feelings and behaviours typical of a younger age Transference: feelings toward an important figure from the past shifted towards someone in the present Projection: process of attaining undesirable feelings and motives to someone else, thereby shifting the blame for the things they feel guilty for Followers suffering from fear, guilt or alienation may experience a feeling of empowerment and transcendence by submerging their identity in that of a seemingly superhuman leader Social Contagion and Charisma Meindl (1990) examines attributed charisma that focuses on influence processes among followers themselves than on how leaders directly influence individual followers “Social contagion”: spontaneous spread of emotional and behavioural reactions among a group of people Many people have a heroic social identity in their self-concept; these people are waiting for a leader and a cause to activate it (Meindl, 1990) Activation occurs more often in a social crisis where their selfesteem/survival is threatened It does not matter who becomes the symbolic leader as long as they are sufficiently attractive and qualify for the role, so loyalty could shift if another person becomes more suitable for the position In the process of social contagion, attribution of charisma to the leader occurs as part of the attempt by followers to understand and rationalize their new feelings and behaviour Qualities attributed to a leader may become highly exaggerated as rumours and stories circulate among people without direct contact to the leader e.g. leaders in religious cults and political movements Close and Distant Charisma Shamir (1995) proposed that attributions of charisma for followers who have close contract with the leader differ from those that view the leader from a distance Students interviewed in Israel to determine if differences could be verified Results showed that the amount of direct interaction between leader and follower affects attributions of charisma Distant charismatics defined in terms of substantive achievements and effects on follower political attitudes; attributions affected by performance cues and shared stereotypes Close charismatics defined by effects on follower motivation, task behaviour and identification with the leader; attributions affected by leader behaviour and interpersonal skills Limitations of study: Yagil’s (1998) study in the Israeli army did not find support for the above; more research needed on how distance affects attributions of charisma. Antonakis and Atwater (2002) cite the importance of distinguishing between vertical social distance (proximity in the authority hierarchy) and physical distance Routinization of Charisma Succession crisis when charisma is dependent on personal identification with an individual leader and if the leader passes away or departs (Bryman, 1992; Mintzberg, 1983) Charismatic leaders can do several things to maintain their influence on the organisation after they depart (Bryman, 1992; Trice & Beyer, 1986) Three approaches for routinization of charisma 1. Transfer charisma to designated successor through rites and ceremonies. However, some leaders may be unwilling to find a successor due to defense mechanisms, preoccupation with the mission, and fear of potential rivals 2. Create an administrative structure that will continue to implement the leader’s vision with rational-legal authority (Weber, 1947). However, this can reduce the effectiveness of the organisation because it is difficult to maintain the same level of enthusiastic commitment when “bland bureaucrats” replace the leader. Conflicts are likely to occur between the administrators and the charismatic leader. E.g. Candy Lightner, founder of MADD (Mothers Against Drunk Driving) (Weed, 1993) 3. Embed the leader’s vision in the culture of the organisation by influencing followers to internalize it and empower them to implement it Consequences of Charismatic Leadership Section discusses the positive and negative consequences of charismatic leadership for followers and the organisation Positive and Negative Charismatics Not always clear when particular leaders should be classified as positive or negative charismatics 1. One approach is to examine consequences for followers, but most charismatic leaders have had both positive and negative effects on followers; disagreements also arise over the outcome’s impact 2. A better approach is to differentiate in terms of the leader’s values and personality (House and Howell, 1992; Howell, 1988; Musser, 1987), i.e. negative charismatics have a personalised power orientation (seeks to dominate over followers and keep them dependent on the leader; centralised power to the leader; wants self-glorification) and positive charismatics have a socialized power orientation (emphasis on internalisation of values instead of personal identification; wants followers to be devoted to ideology over themselves; authority delegated and participation encouraged) The Dark Side of Charisma Negative consequences of charisma (Bass & Steidlmeier, 1999; Conger, 1989; Conger & Kanungo, 1998; Hogan, Raskin & Fazzini, 1990; House & Howell, 1992; Kets de Vries & Miller, 1985) Charismatic leaders tend to take more risks that can result in a serious failure and tend to make more determined enemies who take this opportunity to oust the leader Excessive optimism makes it more difficult for the leader to realise flaws in their vision Identifying too closely with the vision undermines capacity to objectively evaluate Followers will also fail to point out flaw or suggest improvements when they believe in the leader, making it more likely that a bad decision will arise (Finkelstein, 2003) Negative consequences of overconfidence e.g. Edwin Land, inventor of the Polaroid (Conger, 1989) Impulsive, unconventional behaviour of the leader could be taken as inappropriate and disruptive Leader’s strong conviction to untraditional ideologies alienates people that are more traditional Initial supporters can also feel disillusioned if leader fails to give recognition Bass (1985) noted that people’s responses to a charismatic is likely to be polarized (extreme admiration and extreme hatred) However, not even a negative charismatic leader is doomed to failure: many narcissistic charismatics who established political empires, found prosperous companies etc. Continued success possible for a leader who has expertise to make good decisions, political skill to maintain power and good luck Effects of Positive Charismatics Followers with positive charismatics more likely to experience psychological growth and development of their abilities Organisation can adapt to an environment that is dynamic, hostile and competitive Positive charismatic leader usually creates an “achievement-oriented” culture (Harrison, 1987), “high-performing system” (Vaill, 1978), or “hands-on, value-driven” organisation (Peters & Waterman, 1982) Entire organisation encouraged to make important decisions about how to implement strategies and communication is open Harrison (1987) contents that proponents overlook some potential costs: People lose their sense of balance and perspective Exploits their environment and its members in the service of the organisation’s purpose An achievement culture may result in elitism, isolation and lack of necessary cooperation with other subunits Subordinating member needs to the mission can be justified in severe crisis but under less demanding conditions a better balance between task concerns and people concerns is appropriate (Harrison, 1987) Practical Implications for Organisations Charismatic leadership is risky; impossible to predict the result when people give too much power to an individual leader Charismatic leadership implies radical change in the strategy and culture of an organisation, which may not be necessary or appropriate for organisations that are currently successful (people would see no reason for change) Most of the descriptive research (Bennis & Nanus, 1985; Collins, 2001; Kouzes & Posner, 1987; Peters & Austin, 1985, Tichy & Devanna, 1986) suggests that a charismatic leader is not necessary to achieve major changes in an organisation; chief executives of successful organisations used transformational behaviours but they aren’t usually thought of as charismatic Transformational Leadership Distinction between transformational and transactional leadership Followers feel trust, admiration, loyalty and respect toward the leader and are motivated to do more than they are originally expected to do Bass (1985; 1996): leader transforms and motivates followers by 1. Making them more aware of the importance of task outcomes 2. Inducing them to transcend their own self-interest for the sake of the organisation or team 3. Activate higher-order needs Bass believes that transactional and transformational leadership are distinct but not mutually exclusive Effective leaders use a combination of both kinds Leader Behaviours Three types of transformational behaviour (Bass, 1985): 1. Idealized influence: behaviour that arouses strong follower emotions and identification with the leader 2. Intellectual stimulation: behaviour that increase follower awareness of problems and influences followers to look at problems in a new way 3. Individualized consideration: providing support, encouragement, and coaching to followers Revised theory added another kind of behaviour: 4. Inspirational motivation: communicating an appealing vision, using symbols to focus effort and modelling appropriate behaviours Two types of transactional behaviour: Contingent reward: clarification of work required to obtain rewards and use of incentives and contingent rewards to motivate Passive management by exception: contingent punishments and other corrective action to behaviour that deviates from acceptable performance standards Newer revisions: Active management: looking for mistakes and enforcing rules to avoid them Laissez-faire leadership as a meta-category: this type of leader shows passive indifference; also known as the absence of effective leadership than as an example of transactional leadership Influence Processes Underlying influence processes for transactional and transformational not clearly defined, but can be inferred from description of the behaviours and effects on follower motivation Primary influence processes for transactional leadership probably instrumental compliance Transformational leadership probably involves internalization because inspirational motivation includes efforts to link the task to follower values and ideals Transformational leadership also appears to involve personal identification because idealized influence results in follower attributions of charisma to leaders o Charisma necessary for transformational leadership but not sufficient by itself to account for the transformational process (Bass, 1985) Transformational behaviours such as inspirational motivation and individual consideration may increase the self-efficacy of individuals Facilitating Conditions Transformational leadership is considered effective in any situation or culture (Bass, 1996; 1997) Evidence supports the conclusion that in most, if not all situations, some aspects of transformational leadership are relevant However, universal relevance does not mean that transformational leadership is equally effective in all situations or equally likely to occur Transformational leadership likely to be more important in a dynamic, unstable environment that increases the need for change Such leadership is more likely when leaders are encouraged and empowered to be flexible and innovative Growing evidence that follower traits and values may determine how they respond to transformational or charismatic behaviours by a leader Research Methods for Assessing the Theories (could be irrelevant, but has examples of studies) Survey Research Lowe, Kroeck, and Sivasubramaniam (1996): results of their metaanalysis of results from 39 of the studies using MLQ (Multifactor Leadership Questionnaire) found that transformational leadership was significantly related to measures of leadership effectiveness Transformational leadership behaviours correlated more strongly and consistently with leadership effectiveness than transactional behaviours Laboratory Experiments Kirkpatrick and Locke (1996) conducted a laboratory experiment to investigate separate effects of 3 leadership behaviours: 1. Visioning 2. Using a highly expressive style of communication 3. Providing advice to followers in how to do the work better Followers in the vision condition perceived the task to be more interesting, challenging and important, and they set higher performance goals, had higher trust in the leader, and perceived the leader to be higher in charisma, inspiration and intellectual stimulation Visioning had a positive effect on quality of follower performance but did not affect quantity of follower performance Clarifying appropriate work procedures had a positive effect on follower role clarity, job satisfaction, perceived leader intellectual stimulation and both the quality and quantity of follower performance Study provided some evidence for the effect of visioning, but stronger effects were found for clarifying work procedures Field Experiments Only a few field experiments conducted on transformational and charismatic leadership and in each case leader behaviour was manipulated with a training intervention (Barling, Weber & Kelloway, 1996; Dvir, Eden, Avolio & Shamir, 2002) Descriptive and Comparative Studies Descriptive studies look at common attributes among leaders (transformational and charismatic) Others compare leaders pre-characterised as charismatic or noncharismatic or charismatic leaders in different situations Information generally collected from biographies, case studies and articles about the leader and also speeches and writings by the leader Content analysis conducted to identify characteristic behaviours, traits and influence processes (e.g. Bennis and Nanus, 1985; Conger, 1989; Fiol, Harris and House, 1999; Howell & Higgins, 1990 etc.) Examples: o House, Spangler and Woycke (1991) conducted a comparative study on charismatic leadership in US presidents o Bennis and Nanus (1985) conducted a 5-year descriptive study of dynamic, innovative leaders through interviews and observation Leaders demonstrated commitment to the vision by their decisions and behaviour and follower commitment to the vision depended on the trust in the leader which was more likely when the leader’s statements and actions were consistent Leaders channelled the collective energies of organisational members in pursuit of the common vision Intensive Case Studies Longitudinal case studies follower a leader’s career over a period of time and examine their interaction with followers, the leadership context and outcomes of the leader’s influence attempts Example: Roberts (1985) study of the same leader in two successive positions o Began when the leader was the superintendent of a public school district; she was effective in this situation Roberts characterised the successful outcome as a process of creating and managing energy instead of shaping culture or managing meaning Leader was not originally considered charismatic, but was only attributed so because of the way she had resolved a budget crisis o In situations of crisis, charismatic leaders appear to be the hero in the situation In the second situation, the leader was a commissioner o Not considered charismatic in this situation; initiatives had positive benefits but did not generate any widespread support for major change Reasons could include the lack of a major crisis, second position was much more political and constrained her actions making change difficult, and close relationships were not developed in the second position Transformational vs. Charismatic Leadership Debate over the extent to which transformational leadership and charismatic leadership are similar and compatible (whether it is possible to be both transformational and charismatic at the same time) One of the differences in the two theories is the emphasis on attributed charisma and personal identification Bass (1985) proposed that charisma is a necessary component for transformational leadership but also noted that a leader can be charismatic but not transformational Essence of transformational is to inspire follower commitment to shared objectives, increasing social identification and developing follower skills and collective efficacy o Essential influence processes for transformational leadership may not be entirely compatible with essential influence process for charismatic leadership MOST IMPORTANT DIFFERENCE: Transformational leaders probably do more things that will empower followers and make them less dependent on the leader (delegating responsibility etc.) but charismatic leaders do more to foster the image of extraordinary competence Other likely differences: how common it is, the facilitating conditions for it, and typical reactions of people Bass (1996; 1997): transformational leaders can be found at any level of an organisation and is usually relevant for all types of situations Charismatic leaders are rare and emergence appears to be more dependent on favourable conditions (Bass, 1985; Beyer, 1999; Shamir & Howell, 1999) Reactions of people to charismatics are usually more extreme and diverse than reactions to transformational leaders (Bass, 1985) o Charismatic leaders cause polarization of followers Further research should be done on underlying influence processes or go beyond the superficial and often ambiguous data provided by questionnaires Evaluation of the Theories Available evidence supports that many of the key propositions of major theories of charismatic and transformational leadership o Theories provide an explanation for the influence some leaders have on subordinates New theories emphasize the importance of emotional reactions by followers to leaders, whereas earlier theories rational-cognitive aspects of leader-follower interactions New theories also give more comprehensive set of variables and integrate them better in explanations of effective leadership New theories also have conceptual weaknesses (Beyer, 1999; Bryman, 1993; Yukl, 1999b) o E.g. ambiguous constructs, insufficient description of explanatory processes, a narrow focus on dyadic variables and a bias towards heroic conceptions of leadership Limitations of charismatic and transformational leadership theories Most theories focus too narrowly on dyadic processes; not sufficient to explain how leaders build exceptional teams Theories do not explain task-oriented functions of leaders that are essential for the effective performance of the team Theories fail to explain the leader’s external roles: e.g. monitoring the environment to identify threats and opportunities, building networks, serving as spokesperson, negotiation of agreements and helping obtain resources, political support and new members Charismatic and transformational theories don’t explain what the followers are motivated to do and how appropriate it is to the situation Overemphasis on universal leader attributes that are relevant for all situations; more situational variables needed that will determine whether transformational or charismatic leadership will occur and how effective it will be (Beyer, 1999; Bryman, 1992; Yukl, 1999b) Applications: Guidelines for Leaders Articulate a clear and appealing vision o Helps people understand the purpose, objectives and priorities of the organisation o Gives the work meaning, is a source of self-esteem and fosters a sense of common purpose o Helps guide actions and decisions of each member (important when employees are allowed considerable autonomy) (Hackman, 1986; Raelin, 1989) o Success of vision depends on how clear it is communicated (Awamleh & Gardner, 1999; Holladay & Coombs, 1993; 1994) o Should be communicated through a variety of ways o Anecdotes and stories are more effective if they invoke symbols with deep cultural roots e.g. legendary heroes and sacred figures Explain how the vision can be attained o Leader must convince followers that the vision is feasible o Clear link between vision and credible strategy for attainment o Link is easier to establish if strategy has a few clear themes related to shared values of organisation’s members (Nadler, 1988) o Leader should not pretend to know all the answers about how to achieve the vision but should inform followers that they have a vital role in the discovery of what actions are necessary o Strategy needs to be straightforward and unconventional – if too simplistic and conventional, strategy will not elicit confidence in the leader Act confident and optimistic o Leader needs to demonstrate self-confidence and conviction for followers to have faith o Best to emphasize positive aspects of the vision rather than obstacles and dangers Express confidence in followers o Motivating effect of a vision also depends on subordinates’ confidence in their ability to achieve it o People perform better when the leader shows confidence in them and have high expectations (Eden, 1984, 1990; Eden & Shani, 1982; Field, 1989) o Review specific strengths, assets and resources that subordinates can draw on to carry out the strategy Use dramatic, symbolic actions to emphasize key values o Vision is reinforced by leadership behaviour that is consistent with it o Concern for a value or objective is demonstrated by the way a manager spends time, by resource allocation decisions made when trade-offs are necessary between objectives, questions asked and what actions the manager rewards o Symbolic actions to achieve or defend an important objective/value are likely to be more influential when the manager risks personal loss, makes a self-sacrifice or does unconventional things o Effect of symbolic actions increases when they become stories and myths that are retold o E.g. Peters and Austin (1985): CEO personally destroyed some of the company’s low-quality products, showing his commitment to the new policy that they would only sell products of the highest quality Lead by example o Set an example of good behaviour in day-to-day interactions o “Role modelling” o Especially important for dangerous, unpleasant, unconventional, controversial actions o Managers/leaders need to follow through with their standards: Positive: Military leaders who have also gone to battle and shared dangers and hardships Negative: executives that take large bonuses despite financial difficulties that cut employees’ pay o Values espoused by leader should be evident in their everyday behaviour consistently Summary Charismatic Leaders: Attributions of charisma: result of interactive process between 1) leader 2) followers and 3) the situation Attribution of charisma more likely when vision and strategy are innovative, leader takes personal risks and strategy appears to be succeeding Most important: context that makes the leader’s vision especially relevant to follower needs Charismatic leaders don’t always have beneficial effects on the organisation o Can be tyrants or egomanias; can be insensitive, manipulative, domineering, impulsive and defensive o Emphasis on devotion to themselves instead of goals and used to manipulate followers Positive charismatics seek to instil devotion to ideological goals and more likely to have positive effects on the organisation Achievement culture fostered by positive charismatics could also bring undesirable outcomes Transformational Leaders: Make followers more aware of the importance and value of the work Induce followers to transcend self-interest for the sake of the organisation Leaders help develop followers and give them responsibility and support Followers feel trust and respect toward the leader and more motivated Most research relatively supportive However, few studies have examined the underlying influence that account for positive relationship between leader behaviour and follower behaviour Transformational vs. Charismatic Both theories have emphasized tat emotional processes are important as rational processes; symbolic actions are important Necessary to examine organisation’s processes and aspects of strategic management to understand financial performance and survival