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Part I The Fundamentals
of Leadership

CHAPTER 1 Leadership in a Dynamic World
1.1 Defining Leadership and Key Leader Activities

1.2 Relationships Between Leadership and Management

1.3 Leadership and Organizational Success

1.4 Understanding the Leadership Context: The Leader, Followers, and Situation

1.5 Are Leaders Born or Made?

Chapter Summary

CHAPTER 2 Preparing to Lead
2.1 Commitment to Excellence

2.2 The Role of Character in Leader Success

2.3 Personal Characteristics and Actions

2.4 The Keys to Personal Growth and Change

2.5 Changing Behaviors

2.6 A Whole Person Approach

2.7 How To Stay Motivated and Continue to Grow

Chapter Summary

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1 Leadership in a Dynamic World

iStock/Thinkstock

Learning Objectives

After reading this chapter, you should be able to:

• Explain how various individuals define and describe leadership.
• Analyze the similarities and differences between leadership and management.
• Apply basic leadership concepts in order to create more effective companies.
• Integrate the roles of the leader, the followers, and the situation in organizations.
• Describe the scholarship surrounding the question of whether leaders are born or made.

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Introduction

Introduction

In 1981, Richard Teerlink joined the Harley Davidson Motor Company as its chief financial
officer. At that point, Japanese companies had been making dramatic inroads into the United
States economy, and the motorcycle market was no exception. Harley Davidson’s market
share had dwindled to a meager 15% of total national sales and the company experienced an
annual loss of $15 million.

Teerlink became the CEO of Harley
Davidson in 1989. Under his leader-
ship, the company regained its mojo
by concentrating on world-class heavy-
weight motorcycles. His vision for the
organization involved a marketing plan
that emphasized the company’s place
in American culture while seeking out
innovative ways to reach three core
constituencies: customers, dealers, and
employees (Rifkin, 1997). This included
expanding product lines by featuring
clothing and even hamburgers at the
Harley Davidson Midtown Café in Man-
hattan. During Teerlink’s tenure, Har-
ley’s market share soared to 50% of the
domestic market and the organization
enjoyed sales of more than $1.7 billion,

with a corresponding return to profitability. The Harley Davidson brand remains powerful
and popular to this day.

Richard Teerlink provides a powerful example of the impact of quality leadership. Effective
leaders make a difference. They improve both small and larger organizations. They have a
contagious passion for excellence. Recent research suggests that effective leaders are humble
and teachable. They know how to get things done and are skilled at bringing out the best in
people.

Organizations require leadership skills at all levels, not just by people in formal supervisory
roles or top-level management positions. It takes leadership skills to manage a project, initi-
ate a change, or collaborate and be constructive with people from other departments in the
company. These skills help inspire organizational success.

It seems contradictory that while many recognize the value of effective leadership and the
difference quality leaders can make at all levels of an organization, a significant gap often
exists between the need for skilled leadership and its actual practice. A recent study of nearly
4,000 leaders worldwide revealed that most frontline leaders do not have the fundamental
interpersonal skills needed to be effective leaders, and senior leaders also lacked key inter-
personal skills (Frasch, 2013).

In recent years, I’ve surveyed more than 1,000 MBA students who were already in the work-
place. My studies indicate that most organizations place a higher value on management than
leadership, do little if anything to prepare new leaders for their jobs, and rarely have an

Fred Field/Portland Press Herald/Getty Images

Richard Teerlink (left) has a conversation with
Maine Governor Angus King. Teerlink is credited
with turning around Harley Davidson motorcycles
beginning in 1986.

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Section 1.1 Defining Leadership and Key Leader Activities

ongoing process for developing leadership skills. That means that, unfortunately, while lead-
ership is important to the success of organizations and groups of all types, it is more talked
about than practiced. Organizations of all types need skilled leaders. Further, becoming one
will add to your value personally and professionally.

The purpose of this book is to help develop skilled leaders at all levels of organizations. It
explains principles related to better directing individuals and teams. Currently, most organi-
zations face inevitable changes that require continual adaptation in today’s dynamic global
marketplace. This examination of leadership and the strategies to become an effective leader
will be structured as follows:

1. Motivating and preparing people to lead and make a difference (Chapters 1–2)
2. Providing an understanding of fundamental leadership theories (Chapters 3–4)
3. Explaining how communication skills, skills in motivating people to excel, and team

skills are crucial to effective leadership (Chapters 5–7)
4. Exploring how leaders bring about successful, productive organizations and lead

change (Chapters 7–9)
5. Describing how leaders can and should strike a healthy and constructive work-life

balance (Chapter 10)

1.1 Defining Leadership and Key Leader Activities

Leadership has been a subject of interest since the beginning of recorded history. Ancient
writings describe how leaders led battles, started and conquered nations, taught religious
principles, and championed ideas that changed the world.

In the effort to study and understand leadership, some recurring themes appear while many
differences remain, even when you look at the basic characteristics of leaders. For instance,
Napoleon was short and somewhat frail, while David of biblical times was muscular and
strong. Margaret Thatcher, the former Prime Minister of Great Britain, was known for being
calm, low-key, wise, and uncompromising in her principles. Former President Reagan of the
United States garnered fame for being a charismatic communicator. Meg Whitman, the former
CEO of eBay who grew the company from $4 million in 1998 to $8 billion in 2008, was a warm
and friendly leader who some called “Mom.” In contrast, Steve Jobs, the founder of Apple, was
a visionary, intellectual leader who some complained lacked people skills. As a result, we can
learn a lot about leadership and what effective leaders do while recognizing that there is the
flexibility for leaders to be different. Note that none of these leaders was perfect. Each had
weaknesses. This suggests that if leaders do enough things right, they are likely to be success-
ful, even though there will always be opportunities for improvement.

Definitions of Leadership

So, what is leadership? After evaluating many definitions of leadership, such as those dis-
played in Table 1.1, and making an effort to integrate the key ideas and themes, the leadership
definition we will use in this book is as follows:

Leadership is the process of providing vision, direction, and inspiration and
bringing out the best in people, teams, and organizations.

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Section 1.1 Defining Leadership and Key Leader Activities

Table 1.1: Definitions of leadership

• Leadership defines what the future would look like, aligns people with that vision, and inspires them to
make it happen despite the obstacles (Kotter, 1996, p. 25).

• Leadership is about articulating visions, embodying values, and creating the environment within which
things can be accomplished (Richards & Engle, 1986, p. 206).

• The process of influencing the activities of an individual or group toward accomplishing objectives
(Ivancevich & Duening, 2007, p. 675).

• “[L]eadership is not magnetic personality—that can just as well be a glib tongue. It is not ‘making friends
and influencing people’—that is flattery. Leadership is lifting a person’s vision to higher sights, the raising
of a person’s performance to a higher standard, the building of a personality beyond its normal limitations”
(Drucker, 2008, p. 288).

• Leadership is the process of influencing others to understand and agree about what needs to be done
and how to do it, and the process of facilitating individual and collective efforts to accomplish shared
objectives (Yukl, 2010, p. 8).

• Leadership is the ability to influence followers to achieve common goals through shared purposes (Rost
& Barker, 2000).

• Leadership is a process whereby an individual influences a group of individuals to achieve a common
goal (Northouse, 2013, p. 5).

• “Good business leaders create a vision, articulate the vision, passionately own the vision, and relentlessly
drive it to completion” (Welch, quoted in Tichy & Charan, 1989, para. 8).

• Leadership is the process of influencing the activities of an organized group toward goal achievement
(Rauch & Behling, 1984, p. 46).

• The ability to inspire confidence and support among the people who are needed to achieve organizational
goals (Dubrin, 2010, p. 3).

The definitions displayed in Table 1.1 offer many varying perspectives. We can derive a num-
ber of themes from them. Each adds to our understanding of the nature of leadership.

The definitions describe effective leaders. Each seeks to describe the best of leadership
practices—what leaders should aspire to. The definitions focus on defining best rather than
worst practices.

The principles apply to formal and informal leaders. Definitions of leadership tend to focus
on higher-level leaders who are leading large groups or organizations. At the same time, the
fundamental principles apply to formal or informal leaders and leadership roles at all levels
of organization. A formal leader is a person who has been promoted, appointed, or elected to
serve in a leadership capacity in an organization. An informal leader, or emergent leader, is a
person who engages in leadership activities without being formally selected to do so, serving
various organizational needs.

Leadership is a process. A process is a series of actions and interactions that bring about a
particular result. Leadership is not as much about personality and traits as it is about specific
things that leaders do in interacting with others to achieve the desired outcomes.

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Section 1.1 Defining Leadership and Key Leader Activities

Leaders influence others. Leaders are particularly talented at influencing the activities of peo-
ple and groups and motivating them to raise their aspirations and perform at a high level.

Leaders care about their people. Quality leaders genuinely are concerned about people and
their welfare and are skilled at raising spirits and aspirations.

Leaders are visionary. Skilled leaders look ahead for what is possible and what needs to be
accomplished and are able to articulate a clear vision, mission, and purpose for what needs
to be done.

Leaders are goal oriented. Leaders are driven to accomplish challenging goals and are skilled
at engaging people and groups in accomplishing purposeful and shared goals.

Leaders inspire excellence. Effective leaders inspire others to excel, overcome obstacles, and
persevere.

Quality leadership reflects example, character, and integrity. Even the best leaders have weak-
nesses and opportunities to learn and grow. Over time, the most effective leaders set exam-
ples worthy of following and gain recognition for their character, integrity, and principles.

As you can see, the term “leadership” encompasses many ideas. An effective leader is able to
incorporate these concepts into a style and process that obtains results from individual work-
ers, his or her department, and the overall organization. Doing so involves engaging in several
major activities.

Key Leadership Activities

Many people have examined leadership from a variety of perspectives. Search Google and you
will find an overwhelming amount of books, articles, and information available on the sub-
ject. Leadership draws increasing interest in these times of dynamic change, fierce competi-
tion, ever-changing technology, and global influences. An urgent need for skilled leaders who
know how to build organizations for success exists. To meet these challenges, the key lead-
ership activities that we will focus on throughout this book include providing vision, moti-
vation, inspiration, and direction, while bringing out the best in organizations, developing
high-performing teams, and building trust. A brief description of these vital actions follows.

Creating a Vision
Vision means providing a clear and compelling big picture perspective of what needs to be
or could be accomplished and why. Vision could include crafting a compelling and easy-to-
understand mission for an organization or giving a small group a clear picture of something
that needs to be accomplished and why it is important. Providing a clear vision implies that a
leader is knowledgeable and competent in his or her areas of expertise and keenly aware of
what is going on. Some leaders naturally seem to have a clear vision for the future, and oth-
ers become visionary by acting as students of current conditions, best practices, and future
trends, and by virtue of this knowledge, begin to see what is possible.

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Section 1.1 Defining Leadership and Key Leader Activities

An effective leader must not only have a strong vision but also a means to get there. For exam-
ple, when Seth Goldman founded Honest Tea, he had a simple mission: To create and promote
great-tasting, truly healthy, organic beverages. This vision extended to treating all employees
with dignity and seeking to help less advantaged individuals achieve through the company’s
purchasing systems, all the while maintaining an environmentally friendly climate (Honest-
tea.com, 2015).

Providing Direction
Direction involves providing clear goals, values, and priorities, which give meaning to vision.
A vision offers the big picture and direction provides clarity on the specifics of the goals to
pursue (what tasks we need to do), the values that are important in accomplishing goals (how
we need to do things), and the priorities that determine what we need to do when (what is
most important). Visionary leaders who fail to provide clear direction will get people excited
about what they can accomplish and then frustrate them because of the confusion over how
to achieve the vision. Effective leaders stand for clear values and high standards. They also
recognize that how you do things is as important as what you do. Priorities are especially
essential to providing direction, as people are often very busy and have to make choices about
what is most important to do.

Motivation and Inspiration
Leaders get results and make things happen primarily by influencing the behavior and activi-
ties of others. Motivating individuals, therefore, is perhaps the most fundamental element of
effective leadership. This often involves a leader tailoring his or her approach to fit both the
individual and the situation.

An organization is only as good as the individuals who comprise it, which is why all effective
leadership practice must first begin on the level of the individual. Effective leaders under-
stand how to assist and motivate individuals to reach their highest potential. Such leadership
is then not only good for each individual but also for the organization as a whole.

Furthermore, in order to motivate others, a leader has to inspire. Inspiration, in the context
of leadership, means leading by example, encouraging excellence, and helping people to meet
challenges, overcome obstacles, and persevere. A leader must be worthy of following while
also being humble and selfless. Leaders who inspire others also have a passion for excellence
that is contagious. Such passion often manifests itself in a leader’s vision.

Bringing Out the Best in People and Organizations
Successful leaders look for ways to do whatever they can to help people, teams, and organi-
zations become the best they can be. This may include a variety of efforts such as providing
encouragement, training, resources, and a stimulating and supportive work environment.
The key is to have this as a personal goal, to be aware of ways to bring out the best in people,
teams, and organizations, and to look for opportunities.

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Section 1.1 Defining Leadership and Key Leader Activities

High-impact leaders develop great workers. They should do everything possible to ensure
that employees receive good training for their jobs, encouragement, and opportunities to uti-
lize their capabilities; remain up to date in their areas of expertise; and get the chance to
champion needed projects and changes. They can also help employees adapt to changes by
involving and engaging them in the change process and listening to their ideas and concerns.

Committing to bringing out the best in people, teams, and organizations can be a life-changing
approach perspective for leaders. It changes how they think, act, view and treat people, and
spend their time. It influences their priorities and creates a positive impact on others. To
understand this concept and the difference it can make in how leaders think and act, consider
choosing one day in your life where, along with your usual tasks, you make bringing out the
best in people your number one priority. It would significantly change the way you invest
your day and the impact you have on others. It would change the way you view people, how
you treat people, what you say to people, and how you spend your time. It may also have a
significant impact on others. Research on organizations that have leaders committed to build-
ing organizations that perform at a high level and are a great place to work and do business
with shows that these organizations are likely to achieve results far above the industry norm
(Ready, Hill, & Thomas, 2014; Kanter, 2011).

General Roger Teague: Humble Leadership
That Makes a Difference

I recently attended an inspiring promotion ceremony that reinforced my beliefs and
experience that effective leaders make a significant difference in the performance, morale,
and lives of people. The ceremony was for the promotion of Brigadier General Roger Teague
to Major General. In attendance were more than 30 generals and several hundred other
officers, many of whom had come from all over the United States to attend the ceremony.
When General Teague spoke, he used no notes and did not stand behind a podium. Instead he
stood directly in front of all those who were there to honor him and spent the duration of his
speech thanking all those who helped him achieve his goals.

While the whole ceremony was upbeat and inspiring, perhaps most inspiring was interacting
with people who had worked for General Teague. I heard story after story of how General
Teague was a humble, approachable leader who set an inspiring example, knew and cared
about everyone in his command, and motivated them to excel. They spoke of the groups he
led as feeling like a family that cared about what they did, worked like a focused and united
team, and performed at a high level because they didn’t want to let their leader down. Some
individuals I talked to were so inspired by General Teague that they accomplished more than
they ever thought was possible. One enlisted person had gone on to earn several degrees,
become a highly decorated officer, and was getting ready to work on her PhD in leadership.

General Teague no doubt has his flaws and perhaps enemies as well. However, it’s clear that
his humble and conscientious approach to leadership and to others has helped change lives
and make a difference!

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Section 1.1 Defining Leadership and Key Leader Activities

Developing High-Performing Teams
Building high-performance teams and teamwork between groups constitutes a critical activ-
ity for leaders and a key organizational need. Excelling at teamwork has been shown to have
a significant impact on the performance and success of organizations (Carson, Tesluk, & Mar-
rone, 2007; Lawler, Mohrman, & Ledford, 1995). It makes sense that an organization that takes
a systems approach to teamwork and excels at teamwork at the top, within teams, between
teams, and outside the organization with key stakeholders can perform at higher levels than
organizations that do not take this approach. Further, we can often see substantial differences
in performance, morale, quality of work, and speed in getting things done.

It seems ironic that while leaders frequently preach the importance of teamwork, and a cen-
tral theme of many books and articles about how to build successful organizations and gain
competitive advantage is teamwork, often these same leaders don’t learn how to build high-
performance teams and organizations and do little to build teamwork. The goals of this book
include helping leaders understand the advantages of a collaborative perspective, preparing
them with the skills necessary to help build highly performing teams, developing quality net-
works between teams, and encouraging teamwork at all levels of the organization.

Building Trust
Leaders build or tear down trust. People accomplish work better and faster with minimal
obstacles and delays when they can trust their leaders to be honest and straightforward, to
look out for their best interests, and to do what is right. Conversely, people question almost
everything, including well-intentioned decisions, when they cannot trust their leaders. A lack
of trust creates an environment of anxiety, suspicion, and fear, and people take longer to do
things, if they do them at all. Studies reported in the book Building the High-Trust Organiza-
tion (Shockley-Zalabak, Morreale, and Hackman, 2010) indicate that high-trust organizations
outperformed low-trust organizations by 286% in total return to shareholders (stock price
plus dividends) and that high-trust organizations earned more than four times the returns of
the broader market over a period of seven years.

Earning the trust and confidence of those you lead takes time and effort but results in some
positive outcomes. Kouzes and Posner (2012, pp. 33–34) asked people in a study to describe
the personal traits, characteristics, and attributes they look for and admire most in a person
they are willing to follow. They concluded in the following order that the leader must be: (1)
honest; (2) forward looking; (3) competent; and (4) inspiring. Followers want leaders who
tell the truth and who they can trust to keep their word. The most effective leaders consis-
tently act in honorable, transparent, and trustworthy ways.

Note that the ideas in this section do not constitute a complete list of all leader activities.
Other actions range from the mundane (making coffee for others) to the extraordinary. As you
will see in the upcoming pages, leader styles may vary greatly; however, the activities noted in
this section are at the core of effective leadership practices.

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Section 1.2 Relationships Between Leadership and Management

1.2 Relationships Between Leadership and Management

Experts have provided several perspectives regarding the relationships between the concepts
of leadership and management. As we have noted, leadership provides the vision, direction,
and inspiration required to keep people focused and performing at high levels. Management
involves the activities of planning, organizing, staffing, directing, and controlling needed to
make organizations (whole organizations, departments, teams, etc.) operate effectively and
efficiently. Table 1.2 summarizes these major functions. Note that executing could be consid-
ered another function, as the other skills are not relevant if the manager cannot execute.

Self-Reflection Questions

1. Explain the difference between a formal leader and an informal leader. How might
each one have a different effect on a department or organization?

2. Provide an instance in your life when you served under an effective leader. What
strategies did that person employ to achieve success?

3. Provide an instance in your life when you worked for an ineffective leader. Which of
the activities described in this section were missing?

Table 1.2: The management functions

Planning—choosing appropriate organizational goals and identifying the courses of action needed to best
reach those goals.

Organizing—the process of establishing task and authority relationships that allow people to work together
to achieve the organization’s goals.

Staffing—recruiting, selecting, training, evaluating, compensating, and disciplining employees within the
organization.

Directing—coordinating and organizing individuals and groups to work together to achieve organizational
goals.

Controlling—measuring and monitoring systems to evaluate how well the organization achieved its goals.

Some scholars believe that there are no differences because leadership is a part of the man-
agement functions, specifically directing (Fayol, 1949). Others argue that leadership and
management are distinctly different and that the same person is unlikely to be able to per-
form both activities at the same time (Bennis & Nanus, 1985; Zaleznik, 1977). This position
suggests that leaders think and act differently than managers. Those who express this point of
view posit that leaders are passionate and creative and are concerned about vision, strategy,
innovation, change, inspiring excellence, and creating challenges, while managers are tough
minded, rational, analytical, and risk averse and are concerned about stability, order, and effi-
ciency (Simonet & Tett, 2013).

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Bi-modality

Leadership Management

Leadership
&

Management

Uni-dimensionality

Leadership Management

Bi-dimensionality

Section 1.2 Relationships Between Leadership and Management

A third viewpoint suggests that leadership and management require different thinking and
skills but that both are important, at times overlap, and can exist in the same person (Bass,
1990; Hickman, 1990; Kotter, 1988; Rost, 1991). Figure 1.1 illustrates the three perspectives
regarding the relationships between leadership and management. The challenge is to find the
right balance for different levels in the organization and different situations. The position of
this book is to agree with the balance scholars. In other words, effective leaders need leader-
ship skills along with managerial skills.

Leaders need to understand the importance
of these roles. They should seek to understand
where they are personally strong and weak in
the roles. Managers tend to help companies
cope with complex environments through stan-
dard mechanisms such as planning and control-
ling. Leaders, in contrast, may seek to instill
change by creating and implementing a plan for
the future. Managers try to moderate and con-
trol risk; leaders inspire desire and imagination
(Simonet & Tett, 2013).

Therefore, some may excel at one skillset but
not the other. It is not uncommon for vision-
ary leaders who built something special to lack
management skills. When this is the case, rapid
growth in such an organization may begin to
unravel due to the lack of good management.
On the other hand, some excellent managers do
not possess or understand how to deploy effec-
tive leadership skills. Consequently, they try to
manage their organization or group to great-
ness with little success. In understanding their
strengths and weaknesses, leaders can be aware
enough to seek help when needed and can sur-
round themselves with people who have com-
pensating skills.

Figure 1.1: Three perspectives
on the relationship between
management and leadership

Bi-modality

Leadership Management

Leadership
&

Management

Uni-dimensionality

Leadership Management

Bi-dimensionality

Self-Reflection Questions

1. Can you make the case that leadership is more important than management or vice
versa? Explain your answer.

2. Explain an instance in your life in which you felt you were serving more as a man-
ager, not a leader. Then describe an instance in which you felt more like a leader, not
a manager. In what ways were these two situations different? In what ways were
they the same?

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Section 1.3 Leadership and Organizational Success

1.3 Leadership and Organizational Success

At this point, we hope it is clear that many experts agree leadership constitutes one major key,
if not the major key, to productive organization outcomes (Kouzes & Posner, 2012; Collins and
Porras, 1997; Collins, 2001; Ulrich, Zenger, …

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