You are a team of human resource consultants who have been hired by Carla Caruso, an entrepreneur who has started her own interior decorating business. A highly competent and creative interior decorator, Caruso established a working relationship with most of the major home builders in her community. At first, she worked on her own as an independent contractor. Then because of a dramatic increase in the number of new homes being built, she became swamped with requests for her services and decided to start her own company. She hired a secretary bookkeeper and four interior decorators, all of whom are highly competent. Caruso still does decorating jobs herself and has adopted a hands-off approach to leading the four decorators who report to her because she feels that interior design is a very personal, creative endeavor. Rather than pay the decorators on some kind of commission basis (such as a percentage of their customers’ total billings), she pays them a premium salary, higher than average, so that they are motivated to do what’s best for a customer’s needs and not what will result in higher billings and commissions. Caruso thought everything was going smoothly until customer complaints started coming in. The complaints ranged from the decorators’ being hard to get hold of, promising unrealistic delivery times, and being late for or failing to keep appointments to their being impatient and rude when customers had trouble making up their minds. Caruso knows that her decorators are very competent and is concerned that she is not effectively leading and managing them. She wonders, in particular, if her hands off approach is to blame and if she should change the manner in which she rewards or pays her decorators. She has asked for your advice. 

Questions 

1. Analyze the sources of power that Caruso has available to her to influence the decorators. What advice can you give her to either increase her power base or use her existing power more effectively? 

2. Given what you have learned in this chapter (for example, from the behavior model and path-goal theory), does Caruso seem to be performing appropriate leader behaviors in this situation? What advice can you give her about the kinds of behaviors she should perform?

3. What steps would you advise Caruso to take to increase the decorators’ motivation to deliver high-quality customer service? 

4. Would you advise Caruso to try to engage in transformational leadership in this situation? If not, why not? If so, what steps would you advise her to take?