Organization_Behavior

Running Head: LEADERSHIP IN ACTION Leadership in Action Human Relations and Organizational Behavior Smith & Falmouth (S & F) is a midsize tele-shopping and mail order network with operations in the United States and Canada. The company has recently opened a new division, S & F Online, that company leaders hope will result in an increased profit and a competitive advantage in on-line sales. S & F, the parent company of the on-line division, has a typical hierarchical structure with decisions flowing from senior leaders to management teams and project leaders who in turn direct the activities of teams under their jurisdiction. In organizations with a formal hierarchy, power is given to individuals who direct work and allocate resources through direct supervision, and communication is vertical rather than horizontal (McShane & VonGlinow, 2005). This form of organizational structure is referred to as centralized because decisions are typically made by a small group of people within the organizational hierarchy (McShane & vonGlinow, 2005, p. 451). In contrast, organic organizational structures have very little formal or central decision making and allow decisions to be made at the local operational level allowing management to adjust quickly to changing needs. Communication is horizontal rather than vertical (McShane & VonGlinow, 2005, p. 453). Team-based and networks are additional types of organizational structures. Team-based structures have a flat organizational design and consist of self-directed work groups whose work is organized around a specific product or customer type (McShane & VonGlinow, 2005, p.461). Network structures comprise a group of many organizations who form alliances centered on providing a specific product or service. Typically a central firm serves to direct all processes within the network alliance (McShane & VonGlinow, 2005, p. 463). Each organizational type has within its structure both a formal and an informal culture which can influence the effectiveness of any change efforts. Organizational culture refers to, “ the basic pattern of shared assumptions, values, and beliefs governing the way employees within an organization think about and act on problems and opportunities” (McShane & VonGlinow, 2005, p.478). Organizations also have informal, or sub-cultures operating alongside the dominant culture. These informal sub-cultures can influence the formal culture in a variety of ways. Informal cultures can serve to maintain the organizations standards of ethical behavior and performance by allowing employees to see situations from a different perspective (McShane & VonGlnow, 2005). However, they can just as easily breed discontent among members of an organization and have a detrimental effect on performance, recruiting and retention (Harper, 2009). Where exceptional cultures liberate employees to do their best, dysfunctional cultures can drive qualified, dedicated workers away leaving a company with employees who either cannot do their jobs because of the dysfunction or who develop an indifferent mindset (Harper, 2009). Furthermore, dysfunctional, informal cultures can spur employees to engage in counter-productive work behaviors when they do not agree with the formal cultural structure. The informal culture at S & F Online consists of group of three managers, the project manager, the logistics manager and the marketing manager. Each of these managers has a network of employees with whom they communicate and direct organizational activities. The project manager has developed informal relationships with the logistics and marketing managers as well as with the web and logistics teams. The logistics manager has developed informal relationships with the program and marketing managers as well as with the web and logistics teams. The marketing manager’s informal relationships consist of the chief operating officer and the program manager but not the logistics manager. Additionally, the marketing manager has an informal relationship with the logistics team but not with the web team. As can be seen all managers do not share an informal relationship with one another, nor do they all share an informal relationship with the chief operating officer. The marketing manager is the only one of the three who shares an informal relationship with the chief operating officer. This lack of working relationships among the managers impacts the productivity in each of the teams creating power struggles and preventing clear, effective communication among them. In turn, these struggles can adversely affect the success of the organizational goals for S & F Online becoming a profitable business unit in the allocated time frames. Power is an organization has been described as the ability of a person or group of people to influence others (McShane & VonGlinow, 2005). Whereas organizational politics is describes as self-serving, detrimental, and not officially sanctioned by the organization (Rosen C., Levy, P., Hall, R., 2006). According to McShane & VonGlinow (2005), five types of power exist in organizations; power can be legitimate and based on agreement by organizational members, reward power, meaning power is derived from one person’s ability to control rewards allocated to another, coercive power, the ability to be punitive, expert power, the capacity of a person to possess skills or knowledge that others value, or referent power, which is the capacity of a person to maintain power because others hold him in high esteem (chapter 12, pp 360-62). Politics within organizations can affect employee morale and subsequently job performance and organizational commitment (Rosen C., Levy, P., Hall, R., 2006). The dynamic of power and politics within S & F Online is demonstrated by the lack of interaction amongst the three teams designated to turn S & F Online into a profitable business unit. This is complicated even further by the lack of trust between the three teams and their managers resulting in delays and additional power struggles. The counterproductive work behaviors exhibited by the teams is threatening the sustainability of S & F Online. In order for S & F Online to remain viable, project managers and their teams must work together toward a common goal. In order to achieve the goal of becoming a profitable business unit S & F leadership must employ a leadership style and direction that all team members will respect and follow. Leadership styles have been investigated by researchers for decades and the resulting studies have yielded a wealth of information on the qualities necessary for effective leadership. Three prominent types of leaders have been identified by research; change agents, transactional leaders and transformational leaders (Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P., 1999). Change agents are viewed as, “anyone who possesses enough knowledge and power to guide and facilitate the change effort” (McShane & VonGlinow, 2005, p.514). Transactional leaders possess knowledge of employee behavior on a daily basis and are able to implement change by aligning employee behavior with organizational goals (McShane & VonGlinow, 2005). Transformational or, charismatic leaders are those individuals who can articulate a vision of the future that employees can share (Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P., 1999). Transformational leaders differ from transactional leaders in that transactional leaders achieve desired results by appealing to and recognizing that employees desire benefits such as monetary compensation for the work they do. The transactional leader uses rewards and punishments to achieve necessary outcomes (Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P., 1999). The transformational leader, on the other hand, uses personality and persuasion to get followers to transcend their own self-interests, and alter or expand their vision to encompass the vision of the leader (Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P., 1999). In this way transformational leaders create passion that intellectually inspires followers to accept the mission of the group thereby achieving the desired results (Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P., 1999). Transformational leadership does not use coercion or rewards to motivate but rather inspires followers by raising awareness of the importance and value of desired outcomes (Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P., 1999). In order for S & F Online to succeed as a profitable business entity and given the current power and culture structure at S & F Online a transformational leadership style is recommended. The members of the three teams responsible for the successful implementation and financial success of S & F Online are a highly educated and self-motivated interdependent team. As such they value visible and sustained senior leadership involvement. Within this group, leadership must enlist and recruit change champions. According to Warrick (2009), change champions are members within an organization who are skilled at initiating, facilitating and implementing change (Warrick, 2009). Research by Eli Lilly & Company (Crowley, 2007), conclusively demonstrates that any organizational change must first be espoused by a credible authority figure. It must then be followed by coalition-building, communicating, and exercising influence on both the formal and informal cultures (Crowley, 2007). A leader’s influence only extends so far and by building a coalition of other critical leaders or change champions, such as the team managers, the success of the project is greatly enhanced (Crowley, 2007). Communicating sincerity and enthusiasm to teams coupled with an invitation to become involved will further enhance the likelihood of success (Marques, 2009). And finally, using relationship building techniques to influence the informal cultural leaders at S & F will allow senior leadership to overcome the barriers that now confront S & F Online (Crowley, 2007). Use of these transformational leadership characteristics should move S & F Online into the desired direction of becoming an industry leader in online marketing and sales. References Crowley, B. (2007). Why change succeeds: an organizational self assessment. Organization Development Journal , 25 (1), 25-30. Retrieved April 7, 2009, from EBSCOhost database. Den Hartog, D., House, R., Hanges, P., Ruiz-Quintanilla, S., & Dorfman, P. (1999). Culture specific and cross-culturally generalizable implicit leadership theories: are attributes of charismatic/transformational leadership universally endorsed'. Leadership Quarterly , 10 (2). Retrieved April 11, 2009, from MasterFILE Premier database. Harper, S. (2009). Removing dysfunction. Industrial Engineer , 41 (2), 45-49. Retrieved April 7, 2009, from EBSCOhost database. Marques, J. (2009). Making the best of the inevitable: change. The Journal of Global Business Issues , 2 (2), 33-42. Retrieved April 7, 2009, from EBSCOhost database. McShane, S & Von Glinow, M. (2005). Organizational Behavior: Emerging Realities for the Workplace Revolution Foundations of Team Dynamics. McGraw-Hill. Retrieved April 7, 2009, from EBSCOhost database. Rosen C., Levy, P., Hall, R. (2006). Placing perceptions of politics in the context of the feedback environment, employee attitudes, and job performance. Journal of Applied Psychology , 91 (1), 211-220. Retrieved April 7, 2009, from EBSCOhost database. Warrick, D. (2009). Developing organization change champions. OD Practitioner , 41 (1), 14-19. Retrieved April 7 2009, from EBSCOhost database.