Theme one is about the greatest skill a leader can possess that is the art of communication. This week's theme is to discuss the importance of communication which at its heart is the art of listening. Learning activities for the skill based aspect of our discussion should focus on the different forms of communication and how and when they are best used. (Persuasion, written communication, oral, body language, group, diversity etc.) Learning Activity 1 Take one of the communication assessments in your reading. Comment to the class about your results and explain while referencing the reading for the week what areas of improvement you would consider working towards. https://www.mindtools.com/pages/article/newCS_99.htm Sub Theme: is the corollary which is the absence of communication and its destructive nature. Many times failure to communicate comes from poor listening skills. http://www.mindtools.com/pages/article/listening-quiz.htm How good are your listening skills? Take this assessment and find out what areas you can use improvement and report to the class. Do you see a relationship between the areas of improvement in the communication assessment and the listening areas of improvement? If so why? If not, why not? Learning Activity 2 Read the Waite Pharmaceuticals case study found in Richard Daft's book The Leadership Experience (link attached). Daft Chapter 12 Ignore the last paragraph and assume that Lassiter has given you permission to make a presentation to the Board of Directors. Knowing that Hsu is biased in favor of the Standard Company, you must find a way to persuade the Board and Hsu that Standard is not the greatest option for the company. Be creative! Set up the Agenda for your presentation and write the first two paragraphs of your presentation using the tips given in the articles for this week and the videos listed below. Make sure you tell us enough that we get a real feel for your perspective and direction of argument. Remember if you don't communicate your thoughts well the choice will be Standard! Nancy Duarte on creating persuasive presentations How to persuade anyone of anything in 10 seconds Learning Activity 3 You are the CEO of a medium size solar panel firm located in California. You are concerned with the rising taxes in your state and have been negotiating with the Governor for a tax reduction because of your green status. Talks with the Governor however do not look promising. You are considering moving the business to New Mexico and have been in negations with the Governor there and it looks almost too good to be true. The two other members of the leadership are aware the pending move. Your employees however do not know of the discussion and the possible impending move which may require them to relocate. Explain in a memo to your leadership team how and when you want the news to be known to the staff that a possible move is in the horizon. Be sure to explain the way the news should be broken and by whom. Make sure to discuss the timing and how you will handle the feedback you will get from the news. Keep in mind all the things that we discusses about change, trust and vision in your response. Chapter 12: Leadership Power and Influence Your Leadership Challenge After reading this chapter, you should be able to: Use power and politics to help accomplish important organizational goals. Practice aspects of charismatic leadership by pursuing a vision or idea that you care deeply about and want to share with others. Apply the concepts that distinguish transformational from transactional leadership. Use coalitional leadership to build alliances that can help you achieve important goals for the organization. Identify types and sources of power in organizations and know how to increase power through political activity. Describe structural, human resource, political, and symbolic frames of reference and identify your dominant leadership frame. Use the influence tactics of rational persuasion, friendliness, reciprocity, developing allies, direct appeal, and scarcity. Chapter Outline 362 Three Kinds of Influential Leadership 369 Power, Influence, and Leadership 373 Sources of Leader Power 375 Increasing Power Through Political Activity 383 Ethical Considerations in Using Power and Politics In the Lead 367 Jim Goetz, ServiceMaster 371 Steve Jobs, Apple 381 Sheila Bair, Federal Deposit Insurance Corporation 382 Paul Wolfowitz, World Bank Leader's SelfInsight 366 Transformational Leadership 367 Have You Got Charisma? 378 Your Leadership Orientation Leader's Bookshelf 379 Influencer: The Power to Change Anything Leadership at Work 386 Circle of Influence Leadership Development: Cases for Analysis 387 The Unhealthy Hospital 388 Waite Pharmaceuticals H ow did a poor AfricanAmerican girl growing up with a single mom in innercity Chicago turn into one of the most recognized names in financial services? Intelligence, hard work, integrity, and a strong work ethic are part of the answer. But what has really helped Mellody Hobson not only survive but thrive in the white male-dominated world of investing is her political skill. Hobson, who is today president of mutual fund company Ariel Investments, started at Ariel as a student intern and joined full time after college graduation. She immediately started networking, making friends and supporters that she's kept to this day. Hobson hangs out with celebrities like George Lucas and Ciara, enjoys talking with teachers and school children on Chicago's South Side, counts Warren Buffett, Dick Parsons, and Jamie Dimon among her friends, sits on the boards of Este Lauder, Starbucks, and the Chicago Public Library, has hosted fundraisers for Barack Obama since his first Senate campaign, worked with Richard Daley to improve Chicago public schools, and loves mingling with Formula One race fans, where she cheers on Lewis Hamilton, the first black racer. \"She finds a way to find a connection with virtually anyone,\" says David Geffen, cofounder of Dreamworks, where Hobson also sits on the board. Hobson's networking skill has helped her achieve what she wants for herself and for Ariel Investments. Even when she was a 25yearold new employee, Hobson was able to influence Ariel founder John Rogers and board members regarding a critical strategic decisionto strengthen Ariel as a brand focused on value investing by separating it from the Calvert Group, which focused on social investing (the two firms were involved in a joint venture). Rogers says he was initially shocked by Hobson's boldness, but Hobson used information, networking, and personal persuasion to convince him it was the right decision. \"She went out and did a lot of heavy lifting and convinced our board and myself it was the right thing to do.\"1 Mellody Hobson had little formal power as a young Ariel employee, but she already understood how to use politics and influence to get things done. Successful leaders like Hobson take the time to build relationships both inside and outside the organization and to talk informally about important projects and priorities. All leaders use power and influence to have an impact on their organizations. This chapter explores the topic of leadership power and influence in detail. The chapter opens with a consideration of three types of influential leadership. We next examine what we mean by the terms power and influence, consider different leader frames of reference that affect how leaders think about and use power, look at some sources and types of power, and outline ways leaders exercise power and influence through political activity. Finally, we briefly consider some ethical aspects of using power and influence. Three Kinds of Influential Leadership New leaders often think of leadership power as something granted by an organization through the leader's position. However, leaders also have power that doesn't depend on job authority, and they influence people through a variety of means. Three types of influential leadership that rely on a leader's personal characteristics and relationships rather than on a formal position of authority are transformational, charismatic, and coalitional leadership. Transformational Leadership Transformational leadership is characterized by the ability to bring about significant change in both followers and the organization. Transformational leaders have the ability to lead changes in an organization's vision, strategy, and culture as well as promote innovation in products and technologies. One way to understand transformational leadership is to compare it to transactional leadership.2 The basis of transactional leadership is a transaction or exchange process between leaders and followers. The transactional leader recognizes followers' needs and desires and then clarifies how those needs and desires will be satisfied in exchange for meeting specified objectives or performing certain duties. Thus, followers receive rewards for job performance, whereas leaders benefit from the completion of tasks. Transactional leaders focus on the present and excel at keeping the organization running smoothly and efficiently. They are good at traditional management functions such as planning and budgeting and generally focus on the impersonal aspects of job performance. Transactional leadership can be quite effective. However, because it involves a commitment to \"follow the rules,\" transactional leadership maintains stability within the organization rather than promoting change. Transactional skills are important for all leaders. However, in a world in which success often depends on continuous change, organizations also need transformational leadership.3 Rather than analyzing and controlling specific transactions with followers using rules, directions, and incentives, transformational leadership focuses on intangible qualities such as vision, shared values, and ideas in order to build relationships, give larger meaning to separate activities, and provide common ground to enlist followers in the change process. Transformational leadership is based on the personal values, beliefs, and qualities of the leader rather than on an exchange process between leaders and followers. Studies support the idea that transformational leadership has a positive impact on follower development, performance, and even organizational profitability.4 Moreover, transformational leadership skills can be learned and are not ingrained personality characteristics. Transformational leadership differs from transactional leadership in four significant areas.5 1. Transformational leadership develops followers into leaders. Instead of strictly controlling people, transformational leaders give followers greater freedom to control their own behavior. Transformational leadership rallies people around a mission and vision and defines the boundaries within which followers can operate to accomplish goals. The transformational leader arouses in followers an awareness of problems and issues and helps people look at things in new ways so that productive change can happen. 2. Transformational leadership elevates the concerns of followers from lowerlevel physical needs (such as for safety and security) to higherlevel psychological needs (such as for selfesteem and selfactualization). Lowerlevel needs are met through adequate wages, safe working conditions, and other considerations, but the transformational leader also pays attention to each individual's need for growth and development. Therefore, the leader sets examples and assigns tasks not only to meet immediate needs but also to elevate followers' needs and abilities to a higher level and link them to the organization's mission. Transformational leaders change followers so that they are empowered to change the organization. 3. Transformational leadership inspires followers to go beyond their own selfinterests for the good of the group. Transformational leaders motivate people to do more than originally expected. They make followers aware of the importance of change goals and outcomes and, in turn, enable them to transcend their own immediate interests for the sake of the whole organization. 4. Transformational leadership paints a vision of a desired future state and communicates it in a way that makes the pain of change worth the effort.6 The most significant role of the transformational leader may be to find a vision for the organization that is significantly better than the old one and to enlist others in sharing the dream. It is the vision that launches people into action and provides the basis for the other aspects of transformational leadership we have just discussed. Change can happen only when people have a sense of purpose as well as a desirable picture of where the organization is going. Without vision, there can be no transformation. Effective leaders exhibit both transactional and transformational leadership patterns. They accentuate not only their abilities to build a vision and empower and energize others, but also the transactional skills of designing structures, control systems, and reward systems that can help people achieve the vision.7 Charismatic Leadership Charisma has been called \"a fire that ignites followers' energy and commitment, producing results above and beyond the call of duty.\"8 Charismatic leaders have an emotional impact on people and inspire them to do more than they would normally do, despite obstacles and personal sacrifice. They may speak emotionally about putting themselves on the line for the sake of a cause and they are perceived as people who persist in spite of great odds against them. Charismatic leaders often emerge in troubled times, whether in society or in organizations, because a strong, inspiring personality can help to reduce stress and anxiety among followers. For example, Amr Khaled emerged as a young, charismatic Muslim religious leader in Egypt during the Mideast crisis of the early twentyfirst century. Khaled's sermons, delivered in an emotional, impassioned manner, touched people who were searching for a moderate approach to living as a good Muslim.9 Charismatic leadership and transformational leadership are not the same. Whereas transformational leadership seeks to increase follower engagement and empowerment, charismatic leadership typically instills both awe and submission in followers.10 Followers admire both charismatic and transformational leaders, want to identify with them, and have a high degree of trust in them. However, transformational leadership motivates people not just to follow the leader personally, but also to believe in the need for change and be willing to make sacrifices for the sake of the vision rather than just out of admiration for the leader. Charisma can be used for good or ill, but applied wisely and ethically, it can lift the entire organization's level of energy and performance. Charismatic leaders can raise people's consciousness about new possibilities and motivate them to transcend their own interests for the sake of the team, department, or organization. Although charisma itself cannot be learned, there are aspects of charismatic leadership that anyone can use. For one thing, charisma comes from pursuing activities that you have a true passion for.11 Charismatic leaders are engaging their emotions in everyday work life, which makes them energetic, enthusiastic, and attractive to others. Their passion for a mission inspires people to follow them and galvanizes people to action. Consider Martin Luther King, Jr., and his passion for the cause of equality. One organizational leader with this type of passion is Major Tony Burgess, the U.S. Army tactical officer attached on a fulltime basis to Company C2 at West Point. Burgess says he \"fell in love with leading,\" and his passion for commanding an Army company shows in his leadership.12 A number of studies have identified the unique qualities of charismatic leaders, documented the impact they have on followers, and described the behaviors that help them achieve remarkable results.13 Exhibit 12.1 compares distinguishing characteristics of charismatic and noncharismatic leaders.14 Charismatic leaders create an atmosphere of change and articulate an idealized vision of a better future. They have an ability to communicate complex ideas and goals in clear, compelling ways, so that people understand and identify with their message. Charismatic leaders also act in unconventional ways and use unconventional means to transcend the status quo and create change. The final quality shared by charismatic leaders is that their source of influence comes from personal characteristics rather than a formal position of authority. People admire, respect, and identify with the leader and want to be like him or her. Although charismatic leaders may be in formal positions of authority, charismatic leadership transcends formal organizational position because the leader's influence is based on personal qualities rather than the power and authority granted by the organization. Coalitional Leadership Transformational and charismatic leadership both suggest it is the individual leader who acts as a catalyst for bringing about valuable change toward achieving a goal or vision. Yet in most cases, successful change results from a coalition of people rather than the efforts of a single leader. Coalitional leadership involves building a coalition of people who support the leader's goals and can help influence others to implement the leader's decisions and achieve the goals.15 Coalitional leaders observe and understand patterns of interaction and influence in the organization. They are skilled at developing relationships with a broad network of people and can adapt their behavior and approach to diverse people and situations. Coalitional leaders develop positive relationships both within and outside the organization, and they spend time learning others' views and building mutually beneficial alliances. There are four steps for effective coalitional leadership:16 1. Coalitional leaders do lots of interviews. Leaders conduct informal interviews with people from all across the organization to gather information and get a clear sense of the challenges and opportunities they face. Asking openended questions and listening to others enables the leader to learn about the needs and goals of others, find out who believes in and supports the change, who might be opposed and why, and who has ideas, opinions, and expertise that can contribute to accomplishing the desired goals. In addition to interviews, leaders talk informally with people whenever they get a chance. Consider the following example from ServiceMaster. [In The Lead Box 1 Here] [Leader's shelfInsight 12.1 Box Here] [Leader's shelfInsight 12.2 Box Here] 2. Coalitional leaders visit customers and other stakeholders. Coalitional leaders also solicit the views and input of customers as well as other potentially influential stakeholders, such as board members, government agencies, creditors, or others. Jan Frank found that this was a big part of her job bringing change to California's State Compensation Insurance Fund, which receives no taxpayer money but is treated as an arm of state government. When Frank took over in 2007, the agency was reeling from financial scandal, ethical violations, and a criminal investigation. In addition to talking with managers, employees, and board members about her plans and goals for repairing the agency's credibility, Frank also met regularly with lawmakers and regulators to solicit their input regarding operations. She knew their support was crucial to implementing her plans and achieving what she wanted for the agency.18 3. Coalitional leaders develop a map of stakeholder buyin. Leaders typically find that there are some people who strongly support their goals and plans, some who adamantly oppose them, and a large percentage who could swing either way. As illustrated in Exhibit 12.2, in mapping the level of buyin for any significant change, about 10 percent of people can typically be classified as advocates, those stakeholders inside and outside the organization who are strong supporters and will help lead the change effort. Another 10 percent might be partners, who support and encourage the change but will not actively lead it. Twenty percent are typically strongly opposed to the change. These resisters might even disrupt or sabotage change efforts. The remaining 60 percent are classified as observers because they have a neutral attitude toward the proposed ideas and changes.19 4. Coalitional leaders break down barriers and promote crosssilo cooperation. The final critical step in coalitional leadership is continually breaking down barriers and promoting cooperation and collaboration across departments, divisions, and levels. For example, when Colin Powell was U.S. Chairman of the Joint Chiefs of Staff, he regularly brought together the heads of the Army, Air Force, Navy, and Marines so they could understand one another's viewpoints.20 Crossenterprise understanding and cooperation is essential to achieving a larger vision. Power, Influence, and Leadership All leadership relies on the use of power to influence others and get things done.21 Power is often defined as the potential ability of one person to influence others to carry out orders22 or to do something they otherwise would not have done.23 Other definitions stress that power is the ability to achieve goals or outcomes that power holders desire.24 The achievement of desired outcomes is the basis of the definition used here. Power is the potential ability of one person in an organization to influence other people to bring about desired outcomes. It is the potential to influence others within the organization with the goal of attaining desired outcomes for power holders. Potential power is realized through the processes of politics and influence.25 Influence refers to the effect a person's actions have on the attitudes, values, beliefs, or actions of others. Whereas power is the capacity to cause a change in a person, influence may be thought of as the degree of actual change. For example, as a child you may have had the experience of playing a game you didn't really want to play because one person in the group influenced others to do what he or she wanted. Or you may have changed your college major because of the influence of someone important in your life, or shifted your beliefs about some social issue based on the influence of political or religious leaders. Hard Versus Soft Power Most discussions of power include five types that are available to leaders.26 Exhibit 12.3 illustrates the five types of leader power, categorized as either hard power or soft power. Hard power is power that stems largely from a person's position of authority. This is the kind of power that enables a supervisor to influence subordinates with the use of rewards and punishments, allows a manager to issue orders and expect them to be obeyed, or lets a domineering CEO force through his or her own decisions without regard for what anyone else thinks. Hard power includes legitimate, reward, and coercive power, which are defined largely by the organization's policies and procedures. However, it is important to remember that position power and leadership are not the same thing. As we discussed in Chapter 1, a person might hold a formal position of authority and yet not be a leader. Effective leaders don't rely solely on the hard power of their formal position to influence others. Soft power includes expert power and referent power, which are based on personal characteristics and interpersonal relationships more than on a position of authority. In today's world, soft power is, more than ever, the tool of the leader. Consider that Jeffrey Immelt, CEO of General Electric, considers himself a failure if he exercises his formal authority more than seven or eight times a year. The rest of the time, Immelt is using softer means to persuade and influence others and to resolve conflicting ideas and opinions.27 Even the United States military is talking about the importance of building relationships rather than using brute force. Defense Secretary Robert Gates, for instance, says that in the battle for hearts and minds abroad, the United States has to be \"good at listening to others\" rather than just good at kicking down doors, and the Army's new stability operations field manual openly talks about the value of soft power.28 Wesley Clark, former supreme commander of NATO who led the mission against Serb President Slobodan Milosevic, suggests that, for leaders in businesses as well as nations, building a community of shared interests should be the first choice, rather than using threats, intimidation, and raw power.29 Each of the five types of leader power illustrated in Exhibit 12.3 is discussed in detail in the following paragraphs. Legitimate Power Legitimate power is the authority granted from a formal position in an organization. For example, once a person has been selected as a supervisor, most employees accept that they are obligated to follow his or her direction with respect to work activities. Certain rights, responsibilities, and prerogatives accrue to anyone holding a formal leadership position. Followers accept the legitimate rights of formal leaders to set goals, make decisions, and direct activities. Reward Power Power that stems from the authority to bestow rewards on other people is called reward power. For example, appointed leaders may have access to formal rewards, such as pay increases or promotions. Moreover, organizations allocate huge amounts of resources downward from top leaders. Leaders control resources and their distribution. Lowerlevel followers depend on leaders for the financial and physical resources to perform their tasks. Leaders with reward power can use rewards to influence subordinates' behavior. Coercive Power The opposite of reward power is coercive power. It refers to the power to punish or recommend punishment. Supervisors have coercive power when they have the right to fire or demote subordinates, criticize, or withdraw pay increases. For example, if a salesman does not perform as well as expected, the sales manager has the coercive power to criticize him, reprimand him, put a negative letter in his file, and hurt his chance for a raise. Coercive power is the negative side of legitimate and reward power. Expert Power Power resulting from a leader's special knowledge or skill regarding tasks performed by followers is referred to as expert power. When a leader is a true expert, subordinates go along with recommendations because of his or her superior knowledge. Leaders at supervisory levels often have experience in the production process that gains them promotion. At top management levels, however, leaders may lack expert power because subordinates know more about technical details than they do. People throughout the organization with expertise and knowledge can use it to influence or place limits on decisions made by people above them in the organization.30 Referent Power This kind of power comes from leader personality characteristics that command followers' identification, respect, and admiration so they want to emulate the leader. When workers admire a supervisor because of the way he or she deals with them, the influence is based on referent power. Referent power depends on the leader's personal characteristics rather than on a formal title or position and is especially visible in the area of charismatic leadership. For example, Steve Jobs clearly has strong position power as CEO of Apple, but it is referent power and expert power that make him one of the most famous and most powerful leaders in the world. [In The Lead Box 2 Here] Charismatic leadership, such as that of Steve Jobs, is intensely based on the relationship between leader and followers and relies heavily on either referent or expert power. However, all good leaders make use of these types of power rather than using position power alone. The Consider This box talks about the farreaching impact of referent power. Follower Responses to the Use of Power Leaders use the various types of power to influence others to do what is necessary to accomplish organizational goals. The success of any attempt to influence is a matter of degree, but there are three distinct outcomes that may result from the use of power: compliance, resistance, and commitment, as illustrated in Exhibit 12.4.32 When people successfully use hard, position power (legitimate, reward, coercive), the response is compliance. Compliance means that people follow the directions of the person with power, whether or not they agree with those directions. They will obey orders and carry out instructions even though they may not like it. The problem is that in many cases, followers do just enough work as is necessary to satisfy the leader and may not contribute their full potential. Recall our earlier definition of observers in the discussion of coalitional leadership. These people don't actively resist or sabotage the leader's efforts, but they don't fully participate in achieving the vision. However, if the use of hard power, especially the use of coercion, exceeds a level people consider legitimate, some followers will actively resist the attempt to influence. Resistance means that employees will deliberately try to avoid carrying out instructions or they will attempt to disobey orders. Thus, the effectiveness of leaders who rely solely on position power is limited. [Consider This Box Here] The follower response most often generated by soft, personal, and interpersonal power (expert, referent) is commitment. People become partners or advocates, rather than resisters or observers, as defined earlier. Commitment means that followers adopt the leader's viewpoint and enthusiastically carry out instructions. Needless to say, commitment is preferred to compliance or resistance. Although compliance alone may be enough for routine matters, commitment is particularly important when the leader is promoting change. Change carries risk or uncertainty, and follower commitment helps to overcome fear and resistance associated with change efforts. Successful leaders exercise both personal and position power to influence others. Sources of Leader Power The five types of power provide a basis for much of a leader's influence. In organizations, however, additional sources of power and influence have been identified.33 Dependency You probably know from personal experience that when a person has control over something that others want and need, that person is quite powerful. People in organizations, as elsewhere, gain power when others depend on themfor information, resources, cooperation, and so forth. The more people depend on someone, the greater that person's power.34 For instance, an executive assistant who has control over access to the CEO may have more power than a vice president because people depend on her to get their views heard by the top leader. Organizational leaders have power over employees to some extent because people depend on them for their jobs. However, the nature of dependency relationships between leaders and subordinates in organizations fluctuates depending on economic circumstances. When unemployment is low and jobs are plentiful, people feel less dependent on their supervisors, and managers are more dependent on employees because they are hard to replace. Only a few years ago, for example, the shortage of engineers and other hightech talent was so severe that many employees could shop around, gather several offers, and then demand more money and benefits from their employers.35 Not so today. With a struggling economy, widespread layoffs, and high unemployment, the situation has reversed. Organizational leaders have greater power over workers because jobs are hard to come by and most people are dependent on the organization for their livelihood. Control over Resources Dependency within organizations is related to a person's control over resources. Resources include such things as jobs, rewards, financial support, expertise, knowledge, materials, and time. As illustrated in Exhibit 12.5, people are more dependenttherefore leaders and organizations have more control and powerwhen resources are high on three characteristicsimportance, scarcity, and nonsubstitutability.36 People in the organization must perceive the resource to be importantthat is, if nobody wants what you've got, it is not going to create dependency. Resources can be important for a variety of reasons. For example, they may be essential elements of a key product, they may directly generate sales, or they may be critical to reducing or avoiding uncertainty for the organization's top decision makers. Chief information officers have gained a tremendous amount of power in many organizations because of the critical role of IT for both business and nonprofit organizations. Similarly, ethics and compliance officers are highly powerful today because they help reduce uncertainty for top leaders concerning ethical lapses and financial malfeasance. Scarcity refers to whether the resource is easy or difficult to obtain. A resource that is difficult or expensive to acquire is more valuable and creates more dependency than one that is widely available. Leaders and employees with specialized knowledge illustrate this aspect of dependency. In traditional companies moving toward ebusiness, some young Internetsavvy managers have gained power over senior leaders who have little computer expertise. The third characteristic, nonsubstitutability, means that leaders or employees with control over resources with no viable substitute will have more power. A somewhat amusing example comes from Evan Steingart's consumer products company. A lowlevel inventorytransfer clerk had to sign off on the shipment of all goods. Arrogant salespeople who felt they were \"above\" the clerk and treated him badly would find themselves at a disadvantage, as the clerk would have a long list of things to do before he could get to their shipping order, and the salespeople had no recourse but to wait.37 Control over Information One critical resource in organizations is information. Despite the trend toward empowerment and broader information sharing, the fact remains that some people will almost always have access to more information than others. Furthermore, they can withhold or divulge this information in ways designed to achieve their desired outcomes.38 As a negative illustration of this, financial aid leaders at some colleges and universities received \"consultant fees,\" tuition reimbursement, and other perks from several studentloan companies in exchange for providing information that recommended those companies over others to students. The financial aid directors had control of information about various lending agencies, and they could choose to disclose information and shape student decisions that best served their own personal interests. On a more positive note, Attorney General Andrew Cuomo selectively released information to the public as he began investigating the allegations, thereby influencing big banks and colleges to come clean by admitting the sweetheart deals and spurring legislation to protect students from conflicts of interest.39 Control over informationwhich involves both access to information and control over how and to whom it is distributedis an important source of power for leaders. To some extent, access to information is determined by a person's position in the organization. Top leaders typically have access to more information than do lower level supervisors or other employees. They can release information selectively to influence others and shape actions and decisions. However, control over information can also be a source of power for lowerlevel leaders and employees. Employees who have exclusive access to information needed by leaders to make decisions gain power as a result. For example, top executives may be dependent on the production manager for analyzing and interpreting complex operations data. Increasing Power Through Political Activity Acquiring and using power is largely a political process. Politics involves activities to acquire, develop, and use power and other resources to obtain desired future outcomes when there is uncertainty or disagreement about choices.40 Politically skillful leaders strive to understand others' viewpoints, needs, desires, and goals, and use their understanding to influence people to act in ways that help the leader accomplish his or her goals for the team or organization.41 For example, leaders at most organizations engage in some degree of political activity aimed at influencing government policies, because government choices represent a critical source of uncertainty for businesses as well as nonprofit organizations.42 Consider proposed federal legislation that will allow government oversight of many kinds of exotic financial instruments, such as credit default swaps, that were a major cause of the recent financial crisis. Although most people agree some level of regulation is needed, leaders at finance companies will likely be lobbying to insure that the reforms \"preserve the widespread availability of swaps and other important risk management tools,\" as the CEO of one trade group put it.43 Individuals also engage in political activity within organizations. Although some people have a negative view of politics, the appropriate use of political behavior serves organizational goals. Politics is a natural process for resolving differences among organizational interest groups.44 Political behavior can be either a positive or negative force. Uncertainty and conflict are natural in organizations, and politics is the mechanism for accomplishing things that can't be handled purely through formal policies or position power. Leader Frames of Reference The appropriate use of power and politics to get things done is an important aspect of leadership. Before exploring political tactics, let's consider leadership frames of reference and how a political approach combines with other leadership philosophies. A frame is a perspective from which a leader views the world, and it influences how the leader interacts with followers, makes decisions, and exercises power. Four leader frames of reference illustrated in Exhibit 12.6 are structural, human resource, political, and symbolic.45 Leaders often begin with a limited structural perspective and develop the other frames as they mature and climb higher in their leadership development, thus achieving a more balanced mindset and approach. The Structural Frame The organization as a machine is the dominant image in the structural frame of reference. Leaders strive for machinelike efficiency and value hard data and analysis for decision making. The structural frame places emphasis on plans, goal setting, and clarifying expectations as a way to provide order, efficiency, and stability. Leaders rely heavily on the power and authority granted through their organizational position to influence others (position power), and they emphasize clear job descriptions, rules and procedures, and administrative systems. This frame views the organization as a rational system and strives for clarity of direction and control of results. The Human Resource Frame According to the human resource frame, people are the organization's most valuable resource. This frame defines problems and issues in interpersonal terms and looks for ways to adjust the organization to meet human needs. Leaders do not rely solely on their position power to exert influence. Instead, they focus on relationships and often lead through empowerment and engagement. Leaders use the human resource perspective to involve followers and give them opportunities for personal and professional development. The images in this view are a sense of family, belonging, and the organization as a clan. The Political Frame The political frame views organizations as arenas of ongoing conflict or tension over the allocation of scarce resources. Leaders spend their time networking and building coalitions to influence decisions and actions. As with the coalitional leadership style we discussed earlier in this chapter, leaders with this frame of reference strive to build a power base and they use both position and personal power to achieve desired results. The mindset in the political frame is to be aware of the organization as a jungle. Power and politics are considered a natural and healthy part of organizational life. The Symbolic Frame To use full leadership potential requires that leaders also develop a fourth frame of referencethe symbolic framein which leaders perceive the organization as a system of shared meaning and values. Rather than relying only on the use of formal power or the use of political tactics, leaders focus on shared vision, culture, and values to influence others. The dominant image is to see the organization as theater. Leaders are concerned with spirit and meaning, and they focus on harnessing followers' dreams and emotions for the benefit of the organization and all of its people. Each of the four frames of reference provides significant possibilities for enhancing leadership effectiveness, but each is incomplete. Many new leaders have not yet developed a political frame. Leaders can first understand their own natural frame, recognize its limitations, and then learn to integrate multiple frames to achieve their full leadership potential. Political Tactics for Asserting Leader Influence A leader's power is useless unless it is applied to influence others to implement decisions, facilitate change, and accomplish goals, which requires both skill and willingness. The Leader's Bookshelf describes a few strategies leaders can apply when they need to influence people to change their behavior. Not all attempts to use power result in actual influence. Some power moves are rejected by followers, particularly if they are seen to be self serving. Leaders have to determine the best approach for using their powerthat is, the approach that is most likely to influence othersby considering the individuals, groups, and situations involved.46 In addition, they understand the basic principles that can cause people to change their behavior or attitudes. [Leader's shelfInsight 12.3 Box Here] Leaders frequently use a combination of influence strategies, and people who use a wider variety of tactics are typically perceived as having greater power and influence. One survey of a few hundred leaders identified more than 4,000 different techniques by which these people were able to influence others to do what the leader wanted.47 However, the myriad successful influence tactics used by leaders fall into basic categories of influence actions. Exhibit 12.7 lists seven principles for asserting leader influence. Notice that most of these involve the use of soft, personal power, rather than relying solely on hard, position power or the use of rewards and punishments. [Leader's Bookshelf Here] 1. Use rational persuasion. Perhaps the most frequently used influence tactic is rational persuasion, which means using facts, data, and logical arguments to persuade others that a proposed idea or request is the best way to complete a task or accomplish a desired goal. It can be effective whether the influence attempt is directed upward toward superiors, downward toward subordinates, or horizontally, because most people have faith in facts and analysis.48 Rational persuasion is most effective when a leader has technical knowledge and expertise related to the issue (expert power), although referent power is also used. Frequently, some parts of a rational argument cannot be backed up with facts and figures, so people have to believe in the leader's credibility to accept his or her argument. 2. Make people like you. We all know it's easier to say yes to someone we like than to someone we don't like.49 One author of a book on influence tells a story about an American working in Saudi Arabia, who learned that getting information or action from government offices was easy when he'd drop by, drink tea, and chat for awhile.50 Cultural values in Saudi Arabia put great emphasis on personal relationships, but people in all cultures respond to friendliness and consideration. When a leader shows concern for others, demonstrates trust and respect, and treats people fairly, people are more likely to want to help and support the leader by doing what he or she asks. In addition, most people will like a leader who makes them feel good about themselves. Leaders never underestimate the importance of praise. 3. Rely on the rule of reciprocity. A primary way to turn power into influence is to share what you have whether it be time, resources, services, or emotional support. There is much research indicating that most people feel a sense of obligation to give something back in return for favors others do for them.51 This is one reason that organizations like Northrup Grumman, Kraft Foods, and Pfizer make donations to the favorite charities of House and Senate members. Leaders attempt to curry favor with lawmakers whose decisions can significantly affect their business.52 The \"unwritten law of reciprocity\" means that leaders who do favors for others can expect others to do favors for them in return. Leaders also elicit the cooperative and sharing behavior they want from others by first demonstrating it with their own actions.53 Some researchers argue that the concept of exchangetrading something of value for what you wantis the basis of all other influence tactics. For example, rational persuasion works because the other person sees a benefit from going along with the plan, and making people like you is successful because the other person receives liking and attention in return.54 4. Develop allies. Reciprocity also plays an important role in developing networks of allies, people who can help the leader accomplish his or her goals. Leaders can influence others by taking the time to talk with followers and other leaders outside of formal meetings to understand their needs and concerns, as well as to explain problems and describe the leader's point of view.55 Leaders consult with one another and reach a meeting of minds about a proposed decision, change, or strategy.56 A leader can expand his or her network of allies by reaching out to establish contact with additional people. Some leaders expand their networks through the hiring, transfer, and promotion process. Identifying and placing in key positions people who are sympathetic to the desired outcomes of the leader can help achieve the leader's goals. One study found that political skill, particularly networkbuilding, has a positive impact on both followers' perceptions of a leader's abilities and performance as well as on the actual, objective performance of the work unit.57 Sheila Bair, chair of the Federal Deposit Insurance Corporation, has enhanced her reputation and power base by courting allies to support her views on how to fix the troubled U.S. financial system. [In The Lead Box 3 Here] 5. Ask for what you want. Sheila Bair also employs another technique for influencing people, which is to be clear about what you want and openly ask for it. Even opponents praise her knack for being forceful at the right times in order to achieve her goals. Bair has obtained greater power for the FDIC partly because she clearly asked for it. If leaders do not ask, they seldom receive. Political activity is effective only when the leader's vision, goals, and desired changes are made explicit so the organization can respond. Leaders can use their courage to be assertive, saying what they believe to persuade others. An explicit proposal may be accepted simply because other people have no better alternatives. Also, an explicit proposal for change or for a specific decision alternative will often receive favorable treatment when other options are less well defined. Effective political behavior requires sufficient forcefulness and risktaking to at least try to achieve desired outcomes.59 6. Remember the principle of scarcity. This principle means that people usually want more of what they can't have. When things are less available, they become more desirable. An interesting dissertation study on the purchase decisions of wholesale beef buyers found that buyers more than doubled their orders when they were told that because of weather conditions there was likely to be a scarcity of foreign beef in the near future. Interestingly, though, their orders increased 600 percent when they were informed that no one else had that information yet.60 Retailers often use this principle by sending advance notice of sales to credit card holders, making them feel they're getting information that the general shopping public doesn't have. Leaders can learn to frame their requests or offers in such a way as to highlight the unique benefits and exclusive information being provided. One approach is to selectively release information that is not broadly available and that supports the leaders' ideas or proposals. Letting people know they're getting a sneak peakat information captures their interest and makes them more likely to support the leader's position. 7. Extend formal authority with expertise and credibility. The final principle for asserting influence is the leader's legitimate authority in the organization. Legitimate authorities are in a position to be particularly influential. However, research has found that the key to successful use of formal authority is to be knowledgeable, credible, and trustworthy. Leaders who become known for their expertise, who are honest and straightforward with others, and who develop relationships and inspire trust can exert greater influence than those who simply try to issue orders.61 In addition, effective leaders keep the six previous influence principles in mind, realizing that influence depends primarily on personal rather than position power. Leaders can use an understanding of these tactics to assert influence and get things done. When leaders ignore political tactics, they may find themselves failing without understanding why. For example, at the World Bank, Paul Wolfowitz tried to wield power without building the necessary relationships he needed to assert influence. [In The Lead Box 4 Here] Eventually, the board asked for Wolfowitz's resignation. \"What Paul didn't understand is that the World Bank presidency is not inherently a powerful job,\" said one former colleague. \"A bank president is successful only if he can form alliances with the bank's many fiefdoms. Wolfowitz didn't ally with those fiefdoms. He alienated them.\"62 Wolfowitz realized too late that he needed to use a political approach rather than trying to force his own agenda. Even when a leader has a great deal of power, political tactics are more effective than force for turning power into influence. Ethical Considerations in Using Power and Politics Harry Truman once said that leadership is the ability to get people to do what they don't want to do and like it.63 His statement raises an important issue: Leadership is an opportunity to use power and influence to accomplish important organizational goals, but power can also be abused. One consideration is the difference between personalized leaders and socialized leaders.64 This distinction refers primarily to the leader's approach to the use of power.65 Personalized leaders are typically selfish, impulsive, and exercise power for their own selfcentered needs and interests rather than for the good of the organization. Socialized leaders exercise power in the service of higher goals that will benefit others and the organization as a whole. Personalized leaders are characterized as selfaggrandizing, nonegalitarian, and exploitative, whereas socialized leaders are empowering, egalitarian, and supportive. Personalized behavior is based on caring about self; socialized behavior is based on valuing others. A specific area in which the unethical use of power is of increasing concern for organizations is sexual harassment. People in organizations depend on one anotherand especially on leadersfor many resources, including information, cooperation, and even their jobs. When access to resources seems to depend on granting sexual favors or putting up with sexually intimidating or threatening comments, the person in a dependent position is being personally violated, whether or not the leader actually withholds the resources. Partly in response to pressures from the courts, many organizations are developing policies and procedures that protect individuals from sexual harassment on the job and offer mechanisms for reporting complaints. Sexual harassment is not just unethical; it is illegal, and it is a clear abuse of power. However, there are many other situations in organizations that are not so clearcut, and leaders may sometimes have difficulty differentiating ethical from unethical uses of power and politics. Exhibit 12.8 summarizes some criteria that can guide ethical actions. First and foremost is the question of whether the action is motivated by selfinterest or whether it is consistent with the organization's goals. One Internet company has a rule that any employee can be terminated for a political act that is in the individual's own selfinterest rather than in the interest of the company, or that harms another person in the organization.66 Once a leader answers this primary question, there are several other questions that can help determine whether a potential influence action is ethical, including whether it respects the rights of individuals and groups affected by it, whether it meets the standards of fairness, and whether the leader would want others to behave in the same way. If a leader answers these questions honestly, they can serve as a guide to whether an intended act is ethical. In the complex world of organizations, there will always be situations that are difficult to interpret. The most important point is for leaders to be aware of the ethical responsibilities of having power and take care to use their power to help rather than harm others. Leaders should think not in terms of getting their own way, but rather in terms of building longterm productive relationships that can achieve goals and benefit the entire organization. Leadership Essentials This chapter looked at how leaders use power and political processes to influence others and get things done. Three types of influential leadership that rely strongly on a leader's personal characteristics and relationships are transformational, charismatic, and coalitional leadership. Charismatic leaders have an emotional impact on people. They create an atmosphere of change, articulate an idealized vision of the future, inspire faith and hope, and frequently incur personal risks to influence followers. Transformational leaders also create an atmosphere of change, and they inspire followers not just to follow them personally but also to believe in the vision. Transformational leaders inspire followers to go beyond their own selfinterest for the good of the whole. Coalitional leadership involves developing a coalition of people who can help influence others to implement the leader's decisions and achieve the leader's desired goals. To have broad influence, leaders develop relationships with others, listen to others' needs and goals, and promote cooperation. All leaders use power and politics to influence people and accomplish goals. Power is the ability to influence others to reach desired outcomes. The bestknown types of power are legitimate, reward, expert, referent, and coercive, which are associated with a leader's position and personal qualities. Three distinct outcomes may result from the use of power: compliance, resistance, and commitment. The effective use of position power generally leads to follower compliance, whereas the excessive use of position powerparticularly coercive powermay result in resistance. The follower response most often generated by personal power is commitment. A key aspect of power is that it is a function of dependency, which is related to a person's control over resources and control over information. Dependency is greatest for resources that are highly important, scarce, and have no readily available substitutes. Power is acquired, developed, and exercised through political activities. Having a political perspective on the organization is important, because leaders need to use politics to accomplish important goals. A political perspective can be combined with other leader frames of reference. Frames of reference influence how the leader interacts with followers, makes decisions, and exercises power. Four leader frames of reference are structural, human resource, political, and symbolic. Leaders typically begin with a structural frame and develop other frames of reference as they mature in their leadership responsibilities and understanding. Leaders use a wide variety of influence tactics, but they fall within some broad categories based on general principles for asserting influence. Seven principles for asserting leader influence are rational persuasion, liking and friendliness, reciprocity, developing allies, direct appeal, scarcity, and formal authority. One important consideration for leaders is how to use power and politics ethically and responsibly. Ethical leaders use power to serve the organization's goals, respect the rights of individuals and groups, and strive to be fair in their dealings with others. Discussion Questions 1. Lord Acton, a British historian of the late 19th century, said that \"power tends to corrupt; absolute power corrupts absolutely,\" suggesting that a person's sense of morality lessens as his or her power increases. Do you agree? Considering this idea, is it ethical for leaders to try to increase their power? Discuss. 2. What do you consider the most important difference between transformational leadership and transactional leadership? Between transformational and charismatic leadership? How is transformational leadership similar to charismatic leadership? 3. Assume you are on a search committee to replace the CEO of a large financial services firm like Citigroup. Which do you think would be more valuable for a new top leader trying to solve the problems within that organizationcharismatic, transformational, or coalitional leadership? What about for a new top leader of a small private university? Discuss. 4. Which of the four organizational frames of reference do you most admire? How do you think this frame of reference could be beneficial or detrimental to your leadership capability? 5. A recent magazine article suggested that young college graduates just entering the workforce are refusing to \"play the political game.\" Why might this be the case? If politics is important for getting things done, can these people succeed as leaders? Discuss. 6. Which types of power would you rely on to implement an important decision quickly? Which types would you consider most valuable for sustaining power over the long term? 7. How does control over information give power to a person? Have you ever used control over information to influence a decision with friends or coworkers? Explain. 8. Describe ways in which you might increase your personal power. 9. Which of the seven influence tactics would you be most comfortable with as leader of a study group? Of a work team? Discuss. 10. A leadership observer said in an interview that most women leaders view power differently than men do and prefer a collaborative, relationshiporiented use of power. If this is the case, what does it suggest about women leaders' abilities to accomplish goals? What does it suggest about women's ability to rise to higher organizational levels? Discuss. Leadership at Work CIRCLE OF INFLUENCE How do you personally try to influence others? Think carefully about how you get others to agree with you or do something you want. Watch the way you influence others in a team, at home, or during your work. Make a list of your influence tactics: 1. ___ 4. ___ 2. ___ 5. ___ 3. ___ 6. ___ Of the influence and political tactics discussed in the chapter, which ones do you typically not use? ___ ___ ___ During the next two days, your assignment is to (1) monitor the influence tactics you typically use, and (2) try one new tactic that you don't normally use. The new influence tactic you will try is: ___ ___ ___ Another important concept is called the circle of influence. Think carefully about the people who have influence over you. These people are your circle of influence. You may have one circle of influence at work, another at home, and others for your social life or career. Write down the people who would have some influence over you at work or school: ___ ___ ___ This is your circle of influence. A person's circle of influence can be important when you really want to influence that person.If someone doesn't respond to your normal influence attempts, think about identifying the individual's circle of influence the people who have influence over him or her. You can then influence people in the \"circle\" as an indirect way to influence the person you want to change. Pick an individual at work or school, or even your instructor, and plot out that person's circle of influence. List the key people you believe are in the person's circle of influence: ___ ___ ___ How would you get more information on the person's true circle of influence? ___ ___ ___ How can you use your knowledge of the person's circle to have influence over him/her? What are possible disadvantages of using this approach to influence someone? In Class: The instructor can ask students to sit in small groups of three to five people and share the circles of influence they identified for themselves. After listing the circle of influence at work or school, students can also talk about the circles of people who might influence them in their professional, social, or family activities. Key questions for this discussion are: What are the common themes in the students' circles of influence? When and how could the circle idea be applied to influence someone? How might it be misapplied and backfire on your effort to influence another? Leadership Development: Cases for Analysis THE UNHEALTHY HOSPITAL When Bruce Reid was hired as Blake Memorial Hospital's new CEO, the mandate had been clear: Improve the quality of care, and set the financial house in order. As Reid struggled to finalize his budget for approval at next week's board meeting, his attention kept returning to one issuethe future of six offsite clinics. The clinics had been set up six years earlier to provide primary health care to the community's poorer neighborhoods. Although they provided a valuable service, they also diverted funds away from Blake's inhouse services, many of which were underfunded. Cutting hospital personnel and freezing salaries could affect Blake's quality of care, which was already slipping. Eliminating the clinics, on the other hand, would save $256,000 without compromising Blake's internal operations. However, there would be political consequences. Clara Bryant, the recently appointed commissioner of health services, repeatedly insisted that the clinics were an essential service for the poor. Closing the clinics could also jeopardize Blake's access to city funds. Dr. Winston Lee, chief of surgery, argued forcefully for closing the offsite clinics and having shuttle buses bring patients to the hospital weekly. Dr. Susan Russell, the hospital's director of clinics, was equally vocal about Blake's responsibility to the community, and suggested an entirely new way of delivering health care: \"A hospital is not a building,\" she said, \"it's a service. And wherever the service is needed, that is where the hospital should be.\" In Blake's case, that meant funding more clinics. Russell wanted to create a network of neighborhoodbased centers for all the surrounding neighborhoods, poor and middle income. Besides improving health care, the network would act as an inpatient referral system for hospital services. Reid considered the proposal: If a clinic network could tap the paying public and generate more inpatient business, it might be worth looking into. Blake's rival hospital, located on the affluent side of town, certainly wasn't doing anything that creative. Reid was concerned, however, that whichever way he decided, he was going to make enemies. Source: Based on Anthony R. Kovner, \"The Case of the Unhealthy Hospital,\" Harvard Business Review (September-October 1991), pp. 12-25. QUESTIONS 1. What sources of power does Reid have in this situation? Do you believe using legitimate power to implement a decision would have a positive effect at Blake Memorial? Discuss. 2. What influence tactics might you use if you were in Reid's position? 3. Do you see ways in which Reid might use the ideas of coalitional leadership to help resolve this dilemma? WAITE PHARMACEUTICALS Amelia Lassiter is chief information officer at Waite Pharmaceuticals, a large Californiabased co