LEE JACOCCA: AN AMERICAN LEGEND
Lee Iacocca, the son of Italian immigrants, rose spectacularly through the ranks of Ford Motor Company to become its president, only to be toppled eight years later in a power struggle with Henry Ford II. After being fired from Ford
, however, he immediately went to Chrysler Corporation and led that company back from the brink of financial disaster by convincing the United States government to provide Chrysler with a $1.2 billion loan guarantee. Iacocca has been heralded as the epitome of an effective modern leader by the authors of a book about leaders.
He provided the leadership to transform a company from bankruptcy to success. He created a vision of success and mobilized large factions of key employees to align behind that vision. Almost exclusively because of Iacocca’s leadership, by 1983 Chrysler made a pro6t, boosted employee morale, and helped employees generate a sense of meaning in their work. He empowered them. In Fact, we believe that Iacocca’s high visibility symbolizes the missing element in management today his style of leadership is central to organizational successful. Because of his success in rescuing Chrysler and the highly visible role he played in restoring the Statue of Liberty, Iacocca became a media celebrity and an American folk hero. During the 1988 presidential campaign, many People urged him to run for the presidency. Public opinion polls confirmed his popularity and showed that he was a viable political candidate until he withdrew himself by saying, ‘And if drafted
, [shall not run.’2
Lee Iacocca is described as a big man with an imposing presence. He stands 6’1” and weighs 194 pounds. His facial features and personal mannerisms have led one author to describe him as a ‘Florentine prince.” A biography of Iacocca attributed his leadership ability to six character traits:
1. The ability to break away from rigid, stereotyped thinking and use upbeat, energetic approaches to problem solving.
2. His realism and courage.
3. His devotion to homework by being thorough, careful, and well informed.
4. His aggressive curiosity.
5. His uncommon capacity for personal growth.
6. His ability to surround himself with people possessing strong personality ties without being intimidated or threatened by them.4
In his autobiography, Iacocca describes three key elements that contributed significantly to his successful leadership. First, Iacocca believed that he was extraordinarily effective in motivating people because he knew them well, he expressed sincere appreciation for their contributions
, and he provided a vision for them of where the company was going. Second, Iacocca developed a quarterly review system that focused the energies of his people on successful goal accomplishment. Every three months, Iacocca required his managers to submit specific written goals and objectives and then, in a face-to-face, MBO type interview, he required them to explain how they planned to achieve the goals. Finally, Iacocca believed in being decisive. Although he was a strong advocate of being well informed and gathering all the facts before making a decision, he also argued that if you waited until you had 100 percent of the facts
, the opportunity would have passed. Although he liked to be fully informed, he was not afraid to go with his gut feeling and he did not rely on committee* decisions. Iacocca’s definition of management by consensus was, “Consensus, is when we have a discussion. They tell me what they want, then I decide.”
Leadership is an extremely popular topic in organizational behavior because of the role we assume it plays in group and organizational effectiveness. We assume that the success of a group depends primarily on the quality of leadership. To have a winning season requires a good coach; to achieve a military victory commander; and to have a productive work group requires a supervisor. Whether they deserve it or not
, leaders are usually credited for the group’s success and blamed for the group’s failure. When a team has a losing season, instead of firing the team, the coach is fired. Although leadership is similar to management, there is a clear difference between these topics. For managers to be effective, they need to be good leaders. However, not all leaders are good managers. Leadership is more narrowly defined; it refers to influencing the behavior of others. Not all acts of influence, however, are necessarily acts of leadership. There are important differences
, for example, between leadership and the exercise of power described in the next chapter.
Definition of Leadership
The word “leadership’ has been used in at least three different ways. Occasionally it refers to a position within an organization, e.g., “We are inviting all of the leadership to attend the seminar. ‘Leadership” has also been used to describe a personality characteristic, e.g.. ‘Our new supervisor doesn’t have as much leadership as our previous one.”
Neither of these definitions is very useful in studying organizational behavior, and a better definition is needed to understand why some individuals are at he more effective leaders than others. The most useful definition of leadership, well, and the one we will use in this chapter
, is a form of behavior by which one person influences others. ‘Our team won the championship because of the leadership of the quarterback.” In other words, leadership is the incremental influence
one individual exerts over another, above and beyond mechanical compliance with routine directives.
Leadership occurs when one individual MBO-influences others to do something voluntarily rather than because they were the required to do it or because they feared the consequences of noncompliance. It strong is this voluntary aspect of leadership that distinguishes it from other influence processes, such as power and authority.
Although leaders may use force or coercion to influence the behavior of followers, leaders by our definition use their ability to induce voluntary committee. By this definition, anyone in the organization can be a leader, whether or not that individual is formally identified as such. Indeed, informal leaders are extremely important to the effectiveness of most organizations.
An important distinction is made by some between leadership and management. To manage means to direct, to bring about to accomplish, and to have responsibility for. The functions of management, as described in chapter one
, are planning, organizing, directing, and controlling. The successful manager is viewed as someone who achieves results by following the prescribed activities and by maintaining behaviors and products within prescribed limits. To lead, however, is to inspire, to influence, and to motivate. Effective leaders inspire others to pursue excellence
, to extend themselves and to go beyond their perform job requirements by generating creative ideas. It has been said that managers are people who do things right and leaders are people who do the right thing.” This distinction is somewhat overstated, since effective leaders do a lot of managing and effective managers need to lead. But it serves to emphasize an Important organizational outcome: the creation of an energetic and highly committed work force that is successfully adapting to the demands of a changing environment and competently producing a viable product or service
Need for Leadership
Why is leadership necessary? Most organizations are highly structured and have relatively clear lines of authority, stated objectives, and momentum to carry them forward. Why, then, is there a need for incremental influence beyond the routine directives and formal job requirements? Four reasons have been proposed to explain the need for ongoing leadership.
Incomplete organizational structure.
The first reason why leadership is necessary is because there is a degree of incompleteness in every organization design. Social organizations cannot be designed to be like machines
, which are simply turned on and allowed to run untouched. Leaders are needed to structuring the tasks, decide who should do what, and delegate work assignments, level. Leaders help the people they lead to accomplish their collective goals.
The second reason why leadership is necessary is because the organization exists in a changing environment. As the external environment changes, leaders are needed to identify the strategic mission of the organization and help it adapt to its changing environment.
The third reason for leadership stems from the dynamics of internal change in the organization. Leadership is needed to coordinate the efforts of diverse organizational units, particularly during periods of rapid growth or decline. Leadership is necessary to solve internal conflicts and settle differences of opinion.
Motivate and inspire.
The fourth reason why organizations require leadership stems from the need to motivate people and maintain their involvement in the organization. Individuals are not permanent fixtures within the organization. Instead, they come and go, and when they are present
, their needs and Intel interests change. Effective leadership provides meaning and purpose by creating a vision of where the organization is going. This ability to inspire and motivate others and transform them into committed contributors to the organization is the function of leadership that has captured the interest of philosophers and scholars and propelled the study of leadership.
Patterns of Organizational Leadership
The type of influence required for effective leadership is not the same for all leaders. Depending on their level in the organization, different cognitive and affective skills are required of leaders. Three basic leadership roles have been identified: origination, interpolation, and administration.