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Three contingency theories of leadership: a critical outline of Fiedlers, Hersey and Blanchards, and Handys approaches

An essay for Leadership and Teambuilding course (Module A)

By Maxim Peskin MIB, Greenwich cohort

Hult International Business School London, UK

A crucial element of modern business and a topic of wide public discussion for decades, leadership still remains a complicated, largely unexplored and controversial theme in management theory. As Charles Handy points out, the search for the definitive solution to the leadership problem has proved to be another endless quest for the Holy Grail in organization theory (Handy, 1985: 93). Among the numerous concepts and hypotheses proposed in this sphere, situational approach to leadership is one of the more recent developments. As the name suggests, the core idea behind this approach is to renounce the existence of a singular, one-style-fits-all definitive solution and to instead look for leadership techniques and tools best suited to current conditions. Situational theories, also known as contingency theories, can be viewed as a response to the failure of behavioural theories of leadership to prove any consistent correlation between leadership style, employee satisfaction and effectiveness (Mescon, Albert, Khedouri, 1988). While the general concept of situational approach remains the same, a great variety of methodologies is employed by different contingency theories to analyse the situation, suggest the appropriate style and describe the most efficient course of action for the leader (Robbins, 2001). This essay will examine, analyse and critically investigate three contingency theories of leadership in modern business: Fiedlers model, Hersey and Blanchards situational leadership theory and Handys best fit approach. These theories differ substantially in analytic techniques they use as well as leadership suggestions they provide. To assess their practical applicability in modern business, two core factors will be explored: flexibility of these approaches and their actual predictive power. Fiedlers model The model developed by Fred Fiedler uses three key parameters: existing relationships between the leader and the group (including problems of respect, trust and acceptance); level of task structure, or instrumental complexity (highly structured tasks can be characterised by clearly defined goals, simple and rigid implemented procedures, and predictable environment); the degree of power that leader can exert directly over the group (Sutherland and Canwell, 2004). Treating each of the three parameters as a binary variable, Fiedler identified a continuum of leadership scenarios containing eight distinctively different situations, ranging from the most favourable with good relationships with the crew, highly structured tasks and strong managerial positions to the least favourable, which is the exact opposite. Basing on his field research, he further theorised that people-oriented styles of leadership are considerably more effective in the middle of the continuum, whereas task-oriented behaviour is most appropriate to both extremes of the scale (Robbins, 2001). Fiedler considered a persons leadership style to be virtually innate and permanent, so to improve leadership performance an organisation would either need to change the leader or rearrange the situation substantially. In effect, the term style might be misleading in this context and a different perspective could be preferable: the real behavioural gap does not lie between task- and peopleoriented leaders and their respective habitual styles but between psychologically distant and psychologically closer managers (Kelly, 1970, as cited in Handy, 1985). It may be suggested that the former dichotomy is only applied to Fiedlers model erroneously and, given the popularity of task-vsrelationship discourse, by sheer force of habit. While there appears to be sufficient experimental support for Fiedlers ideas (Ayman, Chemers, Fiedler, 1995, as cited in Robbins, 2001), the fact that the initial study was only conducted on a small sample of peculiar groups, e.g. sports teams and air force bomber crews, provides a valid point for criticism (Handy, 1985). More importantly, such evident shortcomings as the generally descriptive attitude, resulting in a very schematic and rigid description of leadership styles, the complexity of contingency parameters and their inconvenience for practical usage impose severe limitations on possible applications of this model in real-life management (Schein, 1980, as cited in Robbins, 2001). It can be concluded that, despite a certain degree of flexibility, Fiedlers model has very little predictive power.

Hersey and Blanchards situational leadership theory This theory is, by contrast, immensely successful as a management technique: according to Claude Graeff, casual conversations with organization development consultants and/or industry personnel quickly reveal the enormous popularity of this model (Graeff, 1983: 285). Apparently, relative conceptual simplicity, which translates to intuitive understanding, is one of the factors explaining its prevalence. The only situational variable used here is the task-relevant maturity, or readiness of employees, measured specifically for every task and environment the group faces. Each of the four levels of readiness necessitates the use of a corresponding leadership style, distinctively different from the rest. This narrow focus allows the model to incorporate the crucial fact of management reality: a leader can only be effective if accepted by the group (Robbins, 2001). To define employees readiness, two parameters are applied: in the original version of the theory, these were ability and motivation. Unable and unwilling employees, who represent the lowest level of readiness possible, require a telling or directing style, with the leader providing specific rules, exact targets and clear guidelines, and establishing strict supervision. This style is extremely task-oriented. As their readiness increases, employees become unable but willing, which implies a selling style, also referred to as coaching (in this context, the two might be regarded as short-term and long-term manifestations of essentially the same leadership style), intense in both task and relationship dimensions. In this case, the leader has to focus on communicating his or her vision, persuading and inspiring the group. On the third level, employees are able but unwilling and the suggested style is called participating or supporting (obviously enough, it is chiefly relationship-oriented): the leader should support the group, fostering collaboration and engagement, encouraging the initiative and inviting mutual feedback. Finally, when the employees are able and willing, the leader must stick to delegating style, refraining from direct action in favour of monitoring. In other words, the employees can be involved in and responsible for every element of the project, from vision to implementation. (Blanchard and Hersey, 1969, as cited in Sutherland et al., 2004) The second version of Hersey and Blanchards situational theory, known as SLII, retained the descriptions of most appropriate leadership styles proposed by its predecessor. However, the factors defining the situation were changed significantly. Graeff argues that ability and motivation had been utmost simplifications all along and the truly sensible dimensions are job maturity and psychological maturity the latter, most importantly, comprising self-esteem, confidence and achievement orientation (Graeff, 1983). Blanchard himself uses the terms competence and commitment, respectively meaning the level of skills (currently available as compared to those necessary) and the presence of a positive attitude towards the task (which also relies on such inputs as confidence and motivation). More the point, while the highest level of readiness is characterised by high competence and high commitment, which is quite predictable from the point of view of the original theory, the other situations are markedly different. The lowest level of readiness corresponds to low competence and high commitment: apparently, this is the effect of the new task. On the second and third levels, competence grows steadily whereas commitment slips down probably because, in the words of Ecclesiastes, the more knowledge, the more grief. Finally, the transition from the third to the fourth level requires a notable surge in both parameters (Blanchard, 1985, as cited in Northouse, 2009). Although it is clear that the second version of the model was designed specifically to counter some of the criticism the first version had attracted, the very fact that exactly the same leadership styles are now suggested as most appropriate in considerably different managerial situations not to mention differently identified is one of the core methodological vulnerabilities of SLII. On one hand, this emphasis on styles seems to justify Handys assertion that situational leadership, despite its name, is primarily a behavioural theory (Handy, 1985). On the other hand, competence and commitment, when used as situational parameters, are just as vague and ambiguous as ability and motivation. Blanchards notion that commitment is a dynamic composition of motivation and confidence is only obscuring the original problem. Furthermore, changes in commitment are presumed to happen, which serves as the foundation of the theory, but they are never fully and thoroughly explained. Finally, as Northouse remarks, there seems to be neither experimental evidence nor logical support for the idea of discrete

and objectively predictable changes in employee commitment that would point to different levels of their readiness (Northouse, 2009). There also is a wholly separate line of criticism, which is grounded on the ideas of postmodern leadership. For example, Hersey and Blanchards theory implicitly assumes that the leader is fully aware of the situation and his or her judgement is sound, unbiased and precise. However, in a real-life scenario this is not necessarily true; a leader might as well be unable or unwilling, incompetent or not committed. In a nutshell, the model fails to account for the existence of immature leaders (Cooper and Locke, 2000). One of the probable consequences is examined by the leader-member exchange theory, which maintains that within every large enough group there inevitably forms a smaller inner circle whose members are trusted, enjoy more intense interaction with the leader and are privileged in other ways, while the rest of the group generally face a more task-oriented attitude (Robbins, 2001). Besides, Hersey and Blanchards model completely overlooks the phenomenon of team leadership and resulting situational factors, such as the complexity and changeability of leadership functions allocation within a team, as well as all consequent cultural shifts within the team. My personal experience serves to suggest that this is one of the critical drawbacks of the model in modern business-related context. Applying Hersey and Blanchards model in practice Three years ago, in 2008, I gathered a team of four fellow students from two technical universities to participate in business games: case study championships, simulation tournaments and so on. I assumed the position of a leader with an array of beliefs and attitudes; some of these were more explicit and openly discussed with the team, while others implicit and subconscious by nature. For instance, I was fully aware that Im primarily relying on a dynamic mix of authoritative selling and democratic delegating styles. I knew that the core elements of the leaders function for me personally were forming a vision; communicating this vision in a manner that would inspire consistent action by the team; clearly demonstrating and full-heartedly supporting definite values which could be used as pragmatic guidelines. This can be described as a slight charismatic bias: I realised that, in order to create, deliver and sustain my vision, I would need to focus on our future purpose, emphasise metaphoric and symbolic communication, perceive acutely and respond to both practical and emotional needs of the team, and last but not least embrace risk and ambiguity. To put it short, the situational approach was the only sensible idea in that case. At the same time, as a team, we understood fairly well that we were equal in skills and abilities, so the only sources of power available for the team leader were expert power, charismatic power and the power of shared values. From a practical point of view, this implied a very functional approach to leadership: not only did we embrace the idea that the conventional functions of a leader could be shared by all team members and reallocated whenever necessary, but we also emphasised that each one of us had to be ready to act as trouble-shooter and conflict manager, should the need arise. From the viewpoint of Hersey and Blanchards theory, we progressed rather quickly from the very start and by the time we had been finalizing our first case project presentation I was already switching willingly from telling to selling leadership style. About two months and a few case studies later, however, the initial task culture of the team was beginning to show signs of mutating into a person culture: mutuality, adaptability and openness were slowly being replaced by quasi-clan formation, whimsical actions, scheming and individual agendas. The drive for achievement we used to be so proud of was waning. Most dangerously of all, team interactions were growing ever more polarised and strained. The four of us appeared to have occupied four different corners of the PAEI model: we were seeing each others contribution as essentially insignificant and pointless. This was a full-blown culture crisis. Nevertheless, in metrics put forward by Hersey and Blanchards theory, it simply couldnt be described (and therefore couldnt be properly addressed): a person culture, although a very tangible state, is not emblematic of any particular level of competence or commitment; a role crisis might also evolve despite the highest commitment and strongest competence of team members.

Bereft of theoretical support and face to face with the crisis and its numerous dramatic consequences, I only made one big bold decision. It was effectively a leap of faith towards the democratic, delegating style of leadership. The rationale was very simple. I assumed that person culture had substantial upsides whereas the role crisis had to be dealt with immediately. The most efficient tactics would involve increasing team members responsibility, empowering them in every relevant aspect. Situational leadership theory would seem to suggest a more temperate solution, basing on or closely following the supporting style. However, as that style doesnt come to me naturally, it would most likely come across as a contrived ruse, instantly worsening the role crisis and amplifying the extant drawbacks of person culture. More importantly, in terms of team maintenance and development, even if this solution improved the degree of collaboration, an unexpected shift towards participating style could result in washing out the team structure and standards of performance, as well as our overall focus. In the end, my intuitive decision proved entirely appropriate, timely and correct. First of all, we managed to recuperate from the crisis just in time to win triumphantly in the final event of the Higher School of Economics case study championship that season. Secondly, we eradicated the role crisis and managed to adapt the person culture to the benefit of the team: it helped maintain our friendship, which holds true to this day. Last but not least, we acquired a hands-on understanding of our preferences and inclinations in team interaction: something only a pressing situation could fully reveal.1 My personal experience appears to support at least some of the criticism, traditional as well as postmodern, addressed at Hersey and Blanchards theory. From a practical point of view, this approach is notoriously inflexible and its predictive power, although a significant improvement over Fiedlers model, is still considerably limited. However, there also exists a prominent practice-oriented framework for situational leadership that appears to be largely free of most of the shortcomings of the theories discussed above: the best fit approach, championed by Charles Handy. Handys best fit approach Unlike both Fiedlers and Hersey and Blanchards models, best fit approach doesnt prescribe definite leadership styles or offer exact solutions for certain situations. This model focuses instead on identifying various contingency parameters that might affect leadership effectiveness and efficiency. Handy proposes four groups of factors, concerning respectively the requirements of the leader, the group, the task and the external environment. Each of these four can be expressed as a variable and placed on a preferential scale which runs from tight to flexible style. The better the fit between the values of four variables, the more appropriate this particular style is to current circumstances. Naturally, variables, values and scales are only used as a metaphor here: at this level the concept of best fit only provides a low-definition subjective tool of analysis (Handy, 1985: 103). The individual factors that comprise and shape the four composites are crucial for practical application of the model. For example, the leaders preference is defined by beliefs and values, internalised norms, ideas about various leadership styles, personal understanding of leadership functions and roles, level of trust in the group, past experience, outlook on personal importance for the group, attitude towards risk and ambiguity, acceptance of responsibility, self-awareness and self-confidence, and so on. The same factors largely affect the employees preferences on an individual level. However, on the level of the group per se the final answer is also heavily influenced by the groups assessment of their practical competence; level of trust, support, respect and mutuality in the group; degree of interest in the task; last but not least, the psychological contract between the group and the leader. (Handy, 1985)
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The theories and models used in the last five paragraphs are borrowed from: Conger and Kanungo, 1998, as cited in Robbins, 2001; Goleman, 2000; Mescon et al., 1988; Robbins, 2001; Blanchard, 1985, as cited in Robbins, 2001; Adizes, 1979, as cited in Have, Have, Stevens, 2003; Handy, 1985; Larson and LaFasto, 1989, as cited in Northouse, 2009.

Characterizing the task thoroughly is probably the most difficult problem in Handys approach. The author himself mentions such criteria as whether the task is design-related or implementation-focused, routine or creative, short-term or long-term, complex in technical or organisational aspects. A crucial factor is whether a prototype-level conceptual solution is acceptable or no margin of error is tolerated (Handy, 1985). It stands to reason that real-life situations might require very different parameters to describe the task and clearly expose what it demands. Proliferation of task classifications further complicates the matter of constructing the leaders dashboard: for instance, Kim and Soergel provide an extensive list covering over 60 notable task typification approaches. (Kim and Soergel, 2005) The fourth group, environmental parameters, include leaders position of power and relationships between the leader and the group (situational factors also employed by Fiedlers model); existing culture and technological structure of the organisation in whole; finally, diversity and changeability of the group along with variety and complexity of tasks. According to Handy, the first pair of factors defines the possible area of adjustment for both the leaders style and the task; the second deals with external pressures; the third is concerned with the limits of applicability for best fit approach itself. (Handy, 1985) While this theory is obviously useless if staff turnover becomes too high, some of its drawbacks are evident even in most favourable scenarios. As it doesnt provide any ready-made answers, leaders who adhere to it would have to spend more time on research and introspection, compared to other approaches. Moreover, the model appears to have gained no momentum at all with theorists, probably due to its considerable methodological overlap with Robert Houses path-goal theory (see Robbins, 2001). Most importantly, Hersey and Blanchards situational theory was criticised above for its assumption that leaders are perfectly mature and aware of the situation: yet Handys best fit approach suggests that leaders can assess dozens of contingency parameters accurately and without bias. Some of these criticisms, although doubtlessly valid, actually address core virtues of the model. The leader need not be the only one to examine the situation: this function may and should be performed by other members of the group, and in fact the need to analyse the leader means other perspectives are absolutely necessary. Handys theory focuses on mutual behavioural adaptation between the group and the leader: this perspective enhances the usability of the model in team leadership context.2 Finally, the quantity and diversity of factors employed gives the model its realistic scope and deep detail. The fact that there are no exact measures reflects the complexity of actual business situations. On the other hand, best fit approach is a general framework which can be used in conjunction with a multitude of other techniques. For example, Belbin profiling or PAEI analysis could help the leader evaluate the role structure of the group, their need for certainty and overall attitudes and expectations, while corporate culture could be investigated using Hofstedes dimensions, which correlate rather strongly with Quinn and McGraths classification. (See Sutherland et al., 2004, Have et al., 2003, and Daft, 2003) The core idea behind Handys approach is that each of the three internal parameters can be moved along the tight-flexible style scale to better fit the other two. A related notion had been proposed by Kerr and Jermier, who found that some situational factors could actually neutralize or substitute for certain leadership styles. For example, exceptionally structured and operationally simplified tasks (with clearly defined goals, formalised established rules and so on) can replace task-oriented leadership (Kerr and Jermier, 1978, as cited in Robbins, 2001).
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Another aspect of mutual adaptation is learning. Handy maintains that one of leaders roles is being a model for the group, which is a key element of learning and adaptation process. He notes that in certain cases it may be a more efficient technique for employee development than coaching (Handy, 1985: 113). A probable explanation can be provided by comparing coaching and imitational learning, as described in relevant literature. Goleman suggests that traditional coaching style of leadership requires employees conscious effort to improve and grow professionally, so their involvement is primarily deliberate (Goleman, 2000). By contrast, modern studies of social and cognitive imitation prove that its chiefly a deeper, non- or subconscious process (Heimann, 1998).

These findings can hardly be incorporated into Fiedlers model: even given aforementioned conditions, the model will still suggest task-oriented style as preferable in a number of situations. From the viewpoint of Hersey and Blanchards theory with its exclusive focus on employee maturity, there is even less room for Kerr and Jermiers ideas. However, Handys theory can fully implement them: with one of the three contingency variables effectively fixed, the leader would only have to adapt the other two, taking the environment into account as well, to achieve the best fit possible for the current situation. This suggests that, in general, Handys best fit approach is immensely more flexible than the previous two and its predictive power is at least on par with that of Hersey and Blanchards theory. Conclusions To conclude, contingency theories are a remarkable milestone in management studies and a huge step towards understanding what affects leadership efficiency and effectiveness in practical situations. This essay has looked in detail at three theories Fiedlers, Hersey and Blanchards, and Handys and investigated their practical applicability using two core parameters: flexibility and predictive power. As a summary of the analysis, it can be suggested that Handys best fit approach is the most practically useful for modern business: it is evidently the most flexible of these three models, while in terms of predictive power it is at least not weaker than the prevalent Hersey and Blanchards situational leadership theory. Practicability is crucial for situational approach. Contingency theories and models demonstrate significant flexibility and predictive power which allow for pragmatic behavioural choices in real-life business scenarios. Armed with contingency theories, leaders are not simply aware that situations matter: whats more, they can actually judge factors and variables that define the present managerial landscape, weigh the available options and choose the most appropriate response accurately and soundly (Robbins, 2001). Naturally, contingency theories do not eliminate the complexity and volatility of the situation completely. In the end, no theory can substitute a leaders experience, keen perception and the ability to execute. However, these models do provide a tangible and reliable framework for leaders decision-making, even if their analysis is somewhat limited in scope and scale. The main pathos of situational approach to leadership is that leaders are tested by the circumstances and therefore no leader is ultimately perfect (Mescon et al., 1988). In todays business, no leader can afford to apply his or her preferred style first and analyse the situation second. Moreover, leaders accountability for their decisions and actions, both successful and futile, is crucial in the context of modern business, with fierce global competition and incessant demand for responsible corporate behaviour on social, economic and environmental scales alike. While contingency theories of leadership do not address the problem of accountability directly, they provide a substantial foundation for further investigation as well as a solid basis for more recent authentic and value-based leadership theories.

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