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Wednesday, October 28, 2020

Why Business Needs Ethics

By: Richard V. Tugas

Divine Word College of Laoag

                                                                     Laoag City, Philippines 

ABSTRACT

All businesses, small or big, must incorporate ethics into its organization.  It should be the core center and lifeblood of every business for them to succeed in their endeavors.  It should be the common ground of doing business.  Having a business is not just for profit alone but consider also for the social responsibility of the business.  How it will affect the consuming public, the market, the economy, as well as the environment?  Ethics plays a major role in doing business.  Having good ethics means building a stronger business that offers a lot of benefits not just to your business but also to the community.  It's a trust-building tool with customers.  Having a strong ethical core to your business can directly affect the strength of your business as a whole and it's future.

Keywords: Business ethics, business, ethics, ethical conduct

INTRODUCTION

Businesses can operate even without ethics incorporated in their organization.  They may gain profit, as well.  But the question is how long they will exist/survive?  Long-term sustainability, it's a goal of every business in the marketplace especially nowadays that we have a very competitive business environment.  How businesses strive in such an environment if they don’t have ethics, good moral character, good intention, social responsibility?  For a business to exist the people involved in the business must have some sort of minimal standards of ethics. A business would fail if all members think that it is normal and acceptable to steal, lie, and break agreements. Besides, a business also needs a stable society in which it carries out its business. The stability of a business depends on some standards of ethics.

So, a business cannot survive without some standards of ethics. Therefore, it is in the best interests of businesses to promote ethical behavior among their members and society. It can also be said that good ethics is good business.

The paper will reiterate the importance of ethics in all businesses.  Business ethics is about how a company incorporates ethics into its operations.  The argument is that, will a business survive even if it disregards ethics?

BUSINESS VS. ETHICS VS. BUSINESS ETHICS

Business is defined as an organization or enterprising entity engaged in commercial, industrial, or professional activities, it's referring to the organized efforts and activities of individuals to produce and sell goods and services for profit (Hayes, 2020).  Businesses can range from small operations operating in one industry to large operations operating in many industries around the world.  Ethics, on the other hand, is a code of conduct that covers the whole human lives and his surroundings which include the relationship of man and his /her fellow man, his society, other sentient beings, and his natural environment (Abun & Magallanes 2018). Ethics helps us to classify, what is good, and what is bad? It involves learning what is right or wrong and then doing the right thing. There's always the right thing to do based on moral principle, and others believe the right thing to do depends on the situation, ultimately, it’s up to the individual.  It tells us to do good things and avoid bad things.  So, if we want a successful business venture, then we are to do business and applying ethics at the same time.

Ethics involves people from different walks of life agreeing on some basic principles of how to conduct themselves.  Since business transactions involve businesses with employees and owners who come from different backgrounds interacting with each other regularly, business ethics provide a common ground everyone can agree upon.  Take for example the meat business.  Buyers of livestock who came from different provinces will adhere to the same standard, which is establishing a suggested retail price (SRP) of livestock.  In that case, sellers will sell their livestock fairly.

Business Ethics means various things to various people but the main point is knowing what is good and bad in the workplace.  However, it’s not enough to just know what’s good and bad but also doing what is good with regards to the products/services you are offering to the market and also to your workforce/employees.   Customers like to be associated with companies with a positive image; this includes a reputation for good ethical trading.  In doing so, you need to (1) treat your employees well, give them the wage due them, show them equal respect, motivate them to be productive; (2) be honest to your customers by giving them quality goods/services, to your suppliers by paying them on time, to your employees by giving them all their benefits, to the government by paying the right taxes; (3)know your social responsibility, don’t harm the environment by polluting it or by abusing its resources, practice recycle-reduce-reuse if necessary. 

By definition, business ethics are the moral principles that act as guidelines for the way a business conducts itself and its transactions. In many ways, the same guidelines that individuals use to conduct themselves acceptably – in personal and professional settings – apply to businesses as well (Corporate Finance Institute, ND).  It keeps the business working within the boundaries of the law, ensuring that they aren't committing crimes against their employees, customers, consumers, or other parties.  Business ethics can be a marketing tool, customers are likely to choose one who practices well in their operations over a company who just after the profit.  

APPLICATION OF BUSINESS ETHICS

Ethically doing it means you are doing it right.  Ethical business practice means doing what is right in your business operations.  For example, giving proper safety gear for your employees on the construction site.  This is very rampant in our country, where companies ignore safety gear.  Depriving them using such gears as a helmet will put workers in danger.  If a hard object falls into one of your workers’ heads, he may suffer injury. 

Determining what’s ethical or not is sometimes difficult.  For example, assuming your company needs a supplier of its annual supplies of personal protective equipment (PPE).  Supplier X offers the same price as Supplier Y, but the former gave you an "under the table" 10% commission of the total price of the contract.  Eventually, you chose the supplier that gave you a commission.  Technically, the transaction is not illegal.  However, there was bribery happened.  And it gave Supplier X due advantage because of the "commission" offered to you.

Now that we are in a war with this pandemic, the battle against Corona Virus Disease (COVID-19), new normal is being observed.  Minors below 21 years old and senior citizens above 60 years old are not allowed to go out of their homes.  During the onslaught of the COVID-19, lockdowns were being implemented.  The government together with its health experts warned the citizens to cooperate and begged to “flattened the curve”, to help each other curb the virus, a responsibility all we share, enumerating the behaviors to achieve that goal.  Without specific guidance on what ethical conduct is and why people will decide things like the ethics of ordering their food.  People are aware that delivery boys may be a carrier of the virus, so they opted to cook for their food.  To avoid crowded places like in public utility jeeps/buses.  To not going out if not necessary.  The ethical behavior at this moment is to just stay home.  The mandatory use of face mask and face shield, social distancing, and other health protocols.  There's now the ethical behavior being practiced with this public health crisis.  We observed that the prices of this Personal Protective Equipment (PPE) skyrocketed. Demand is very high, while demand is low, as a result, price increases.  As a manufacturer/dealer of PPEs, you may increase the price.  It is reasonable because of the market needs. But is it ethical/moral to double the price even though your supplies are from your old stock?  It’s your social responsibility to help stop the spread of the virus, hence selling your PPEs at a low price will help not just your customers but the government as well. 

Encourage Business Ethical Conduct

Conducting yourself ethically as a small-business owner and encouraging your employees to engage in ethical business conduct brings about several benefits for your company. Similarly, unethical conduct can hurt your business financially and tarnish its image, leading to diminished future opportunities for your company (Symes,n.d).  If your employees feel that they are treated well, they are less likely to do unethical in your business.  They will take good care of your equipment because they will treat it as theirs. After all, you treated them as family/friends.  When your business engages in a behavior that is either ethical or unethical, the consuming public or customers will notice it.  If your company acts in ways the public considers ethical, your company enjoys an increase in public trust.  Building a positive image in the public unlocks opportunities and avoid unnecessary negative feedback about your operations.  Practicing ethical conduct in your business will help your business to build customer loyalty, attract and retain talented employees, and avoid legal problems.  Customer loyalty means they will choose to patronage your products/services over your competitors’ products/services.  Having a loyal customer base is one of the keys to long-range business success.  This will generate an additional sale and eventually income.  Also, treating your employees well and giving benefits due them will choose to stay and help you succeed in the operation of your business. Talented individuals want to be compensated fairly for their work and dedication. They want career advancement within the organization to be based on the quality of the work they do and not on favoritism. They want to be part of a company whose management team tells them the truth about what is going on.  On the other hand, if you disregard practicing good moral ethics in your business then you may be facing a possible devastating lawsuit, negative publicity, wasted time, loss of money, and low employee morale.  At times, you may be tempted to cut corners in pursuit of profit, such as by not fully complying with environmental regulations or labor laws, ignoring worker safety hazards, or using substandard materials in your products. The penalties for being caught can be severe, including legal fees and fines or sanctions by governmental agencies. The resulting negative publicity can cause long-range damage to the company’s reputation that is even more costly than legal fees or fines. This may result in bankruptcy.

 CONCLUSION

 Now that we know what business ethics is, it is more important to walk the talk.  It’s not enough to just market your business as ethical, you should practice good ethical behavior.  Some businesses choose profits over ethics, they profited through unethical behavior. Even though there are many businesses that at one time have engaged in unethical behavior, it is not a good long-term business strategy.  Ethical behavior is the best long-term business strategy.  It is not always rewarded and unethical behavior is not always punished. But it can give your business significant competitive advantages over unethical companies.

 REFERENCES

1. Hayes, A. (2020). Business definition. Retrieved from https://www.investopedia.com/terms/b/business.asp

2. Abun, D. & Magallanez, T. (2018). Universal Business Ethics: A Challenge to Multinational Companies.

3. Corporate Finance Institute (n.d). Retrieved from https://corporatefinanceinstitute.com/resources/knowledge/other/business-ethics/

4. Symes, S. (n.d). Importance of Ethical Conduct in Business. Retrieved from https://smallbusiness.chron.com/importance-ethical-conduct-business-25163.html

 

 

 


Friday, October 23, 2020

Dealing with Ethical Challenges in the Workplace

Alice Jessa Mae P. Reynon

                                                              Divine Word College of Laoag 

Abstract

This article focuses on the ethical issues we may experience or witness in our workplace. Rationalization — the ability to justify our behavior — is one of our greatest moral failings. Very often, these situations begin in small ways, with very small steps that seem insignificant.   It’s important to not only know how to recognize an ethical issue but how to raise it, especially one that maybe has a great impact on the business or related parties or the employees alone. This article aims to provide significant ways and steps on how to handle such challenges. Both employer and employees should guide their choices with basic ethical principles.

 Keywords: Ethics, ethical challenges, workplace

Introduction

Sometimes you sense that something isn’t right at work. You might disturb and feel uncomfortable with such things that contrary to what you know is right. Though you expect your workplace’s corporate culture to champion honesty and behaviors that are ethical and free from immoral, unethical, or even illegal activity and though you personally promote the highest standards of ethical conduct, you might one day find yourself working at a company whose ethical extent seems broken or whose new initiative pushes the limits on regulatory standards or runs utterly contrary to your strong work ethic.

Ethics can be dangerous to your career. The danger may come not from your own ethics but from the ethics of people around you and the organization of which you are apart. At work, you may be called upon to do things that turn out to be unethical or even illegal.

What should you do if that occurs? What do you do if you personally notice, experience, or even strongly suspect that your company has undertaken an activity or endorses behavior that is counter to the moral high ground, breaks a regulation, or could even be illegal? How do you know when it’s worth speaking up or not? Can you protect yourself from the potential consequences of calling out bad behavior? And when you do decide to say something, what do you say and to whom?

What's an Ethical Issue?

A marketing associate sneaks reams of paper into their briefcase to take home. A division manager asks her financial analyst to fudge some numbers for a client report. A sales executive pressures his assistant to meet with him in his hotel room. A receptionist uses a sick day so he can go to the music festival his boss didn't approve Paid-Time-off for (Plumhoff, 2019). These are some of the many ethical challenges that an employee may experience in their workplace.

Most individuals and companies do not set out to make a defective product or to engage in massive fraud. Very often, these situations begin in small ways, with very small steps that seem insignificant. It is also important for people to understand that most ethics scandals typically involve a number of people who are included in the decision-making process at each stage. As a result, responsibility becomes diffused among these individuals, making it difficult to attribute blame to or impose accountability on any particular person. Although people may feel uncomfortable with what is happening as they move down the “slippery slope,” they convince themselves that “so long as it is legal, it is ethical” or that they are doing what is expected of them. Rationalization — the ability to justify our behavior — is one of our greatest moral failings. Behavior that would clearly be considered unethical by an outsider becomes acceptable to those involved because “that is the way it has always been done” or “it doesn’t really hurt anyone” or “that’s the way they do it at Firm X.”(Boatright & Baumhart, 2013).

Take ENRON, for example. Were the actions of ENRON CEO a good example of ethics? No. But, what they were was a classic example of two things: One, those actions displayed how ethics were not used in any way. Two, their actions painted a grim and realistic picture of what can happen when ethics are neglected. Had ethics been considered in the first place by the leaders of the company, there would have been no scandal. If ethics were used on a daily basis in every company, there would never be scandals.

 The Different Ways People Handle Ethical Issues in the Workplace

Pastin (2013) identified different personality types in terms of how people deal with ethical problems on the job:

The conformist is an employee who follows rules rather than questions of authority figures. One might think this person could be counted on always to do the right thing. The conformist might look the other way, however, if a higher-up were acting unethically. After all, a manager is supposed to be obeyed. This person will run into work-related conflicts unless there are strict rules and well-defined consequences for not following them.

The negotiator is someone who tries to make up rules as he goes. When faced with a sketchy situation—say, a co-worker is drinking on her lunch hour—this person might wait to see if the behavior affects his job in any way, to see if the drinking gets any worse, or to see if anyone else notices. The negotiator will eventually encounter ethics-related trouble if he is required to exercise judgment without guidelines, because this person changes the rules according to what seems easiest at the time.

The navigator is someone who, when confronted with a situation in which people are behaving unethically, is able to rely on an innate ethical sense to guide her actions, even if these decisions aren’t easy. This person has a sound moral compass, which provides the flexibility to make choices, even unpopular ones. The navigator’s ethical sense imbues her with qualities of leadership. Other people respect and count on this person. The navigator will succeed in most organizations but will leave a company that is unethical.

The wiggler doesn’t give a lot of thought to what is right. Instead, this person takes the route that’s most advantageous to him. For example, he may lie to appease a supervisor. The wiggler is motivated by self-interest—getting on a manager’s good side or avoiding conflict. The wiggler will run into trouble when others sense that he dodges ethical issues to protect his own interests.

 Speaking up can be really difficult, especially when the questionable behavior seems embedded. Those who report wrongdoing run the risk of repercussions from peers and/or higher-ups. Therefore, “Trust and openness are crucial elements of an ethical organizational culture. Only when employees are able to voice the problems they see can ethical lapses be discussed and resolved,” Says De Cremer (2016)

The Importance of Ethics in the Workplace

Ethics in the workplace should be a core value of any organization. Aside from doing the right thing, conducting ourselves ethically has great rewards and returns. Being ethical is essential to fixing problems and improving processes. It is needed to establish baseline measures and increase efficiencies. Most importantly, it is essential to have strong working relationships with people. On the other hand, covering up our unethical behavior does the opposite. Obfuscating and hiding from our failings impedes our ability to grow as leaders, as workers, and as people. It also ensures that our coworkers won’t trust us. ( Sporleder, 2020)

What Should You Do When You Spot an Ethical Issue?

Plumhoff (2019) provides a guideline on how to deal with ethical issues in the workplace:

1)      Acknowledge that the issue exists. First, don't rationalize it away. Don't think "this is business as usual" or "this isn't a big deal." If you see something that makes you feel uncomfortable, it's probably because it's violating the morals and principles by which you try to live your life, and unless you're a true narcissist with absolutely no concern for the wellbeing of others, those principles are worth listening to.

2)      Assess the scope and severity of the problem. Next, understand what's at risk, both for you and your company. If you've noticed your cubicle mate tucking extra granola bars from the snack pantry into his backpack, your spidery sense of "stealing from the company is not good" might be tingling, but what's the potential bad outcome? A monthly food budget that's $4.99 higher? It's not that he's not committing an ethical violation, but it might not be worth reporting.

You also want to be clear with yourself about what’s happening. If your coworker is leaving early every day, is it worth doing something about it? One could make the argument that she’s stealing time from the company and therefore taking money that’s not hers. But if she gets her work done, does it really matter? (Gallo, 2015) Gentile suggests asking yourself: What is the value that’s being violated here? Why is this troubling me? Being clear about the issue will help you accurately weigh the pros and cons of addressing it.

When considering whether or not something is worth reporting, you should consider the repercussions you'll face — both if you choose to report it, and if you choose not to report it and later the issue comes to light.

In a world where we're dependent on our jobs for things like health care and having a place to sleep at night, it might not be worth risking your security for the security of the company. (Is that granola bar fiend and cubicle mate also your supervisor, for instance?) That calculus starts to change as the risk to the company, employees, or its customers goes up, in which case you may feel a true moral imperative to report, regardless of the repercussions you may face.

In those more drastic situations, you should also realize that you could very well face negative consequences if you choose not to report, and someone later finds out you were aware of the issue but said nothing.

As you consider the scope of impact, think about the following dimensions: the company's employees, the company's clients, the company's reputation, and the company's bottom line. How many of those are affected? How big or pervasive is the problem?

3) Determine who to talk to. Once you've defined the harm and decided it's worth bringing up, it's time to figure out who to talk to about it. If it's a smaller issue, consider talking to the perpetrator themselves, and do so in a non-accusatory way. See if you can better understand the situation at hand. If it really is an ethics violation, see if you can get the person involved to change their behavior.

If the violation is a bigger deal, consider bringing it up with your supervisor. Say something like, "I see X happening and it worries me. Does this worry you, too? If not, can you help me see why?" Try to understand their perspective and ask yourself if they're being reasonable and you just missed something, or if they're rationalizing away the flag. If your boss is involved in the issue itself and you don't feel comfortable bringing it up with them, or if it's a severe issue that puts people at risk, you may want to go to straight to Human Resources. If you have a reporting hotline, you can use that, or you can speak to your HR rep in private. Consider your own safety throughout the process. Just because a company has a "No-Retaliation" policy doesn't mean it will always be followed, so there's no shame in reporting anonymously if that option is available to you.

Document your findings, if you can, to better protect yourself from any whistleblowing repercussions.

 How to Report Unethical Behavior in the Workplace

All companies have a standard of ethics that must be followed, but ethics goes beyond just company policy. There are laws to be obeyed, ethical practices to live up to, and a standard of excellence that every professional need to strive to reach. When there is unethical behavior in the workplace, it is absolutely imperative that it is reported. If you find yourself in the unenviable position of being the one to report the unethical behavior, here’s how to do it right says Peloquin (2015).

1.      Investigate the unethical behavior. Just because something looks unethical, that doesn’t mean that it automatically is. There may be unforeseen reasons why things are being done the way they are, and your jumping to conclusions will only make the situation worse. Before you file any reports, do a bit of digging into the practices that appear unethical. Find out what’s really going on, and talk to others who may have noticed it as well. Give your co-workers a chance to explain themselves before you take it to HR.

2.      Compile proof. If things are as unethical as they appear, it’s time to compile the proof of the unethical practices. You may need documents to back up your claims, or you can take notes of the things that are morally or ethically wrong. Make sure to note who is doing what and when, and gather any paperwork that can help to back up your claims. ALWAYS have copies--one for yourself and one for HR.

3.      File a claim with HR.  The Human Resources department in your company will be able to help you with the process of filing the claim. They will usually walk you through it step by step, but they’ll question you to ensure that you have the necessary proof. They want to avoid any problems at your office just like you do, so they’ll want to be certain that there truly is unethical behavior taking place.

4.      Fill out the reports. There is going to be a bit of paperwork that you will need to fill out to file the claim, so be patient. Fill out the paperwork correctly and neatly, and don’t be in a rush. Take it home and fill it out there, where none of your co-workers can snoop on you or see what you are doing. Make sure your report ONLY contains facts, with as little personal opinion as possible. Your only goal is to deal with the unethical behavior, not act vindictively to push a wrongdoer. Take the emotion out of it, but treat it as a "facts only" report.

5.      Keep it to yourself. Once the claim has been filed, HR will do its own digging into the problem. They will handle the investigation into the claim, and they will take steps to correct the issue. DO NOT talk with others about it, and do not gossip about the person being investigated. No matter how much proof you have, don’t share it with others. Just keep to yourself, keep working hard, and let the matter sort itself out.

 Conclusion

 Ethical issues can be dangerous to your career if you have not been trained to identify and analyze ethical problems and to resolve them effectively. Ethics can also be dangerous to your career if you work in an organization that does not support ethical behavior or, worse, encourages misconduct. When addressing something as complicated as an ethical problem, remember that you should consider things very carefully before taking any drastic action. Make sure that you’re aware of all sides of the story, and confide in people close to you for their advice and opinions. Finally, we should be aware that anyone can get caught up in unethical conduct under the right circumstances. In every organization, even if it implements very strong controls or forces, we humans have many weaknesses that make us vulnerable to wrongdoing. Steps can be taken to improve both organizations and the individuals in them, and we should take those steps. But the dangers cannot be eliminated entirely. So take control of your ethical career by cultivating moral humility, preparing for challenging situations, maintaining your calm in the moment, and reflecting on how well you’ve lived up to your values and aspirations. 

References

Plumhoff, K. (2019). How to Speak Up About Ethical Issues at Work. Retrieved from https://blog.powertofly.com/how-to-speak-up-about-ethical-issues-at-work-2640124479.html

Boatright, J. &  Baumhart, R. (2013). Confronting Ethical Dilemmas at Work: Why Do Good People Do Bad Things? https://blogs.cfainstitute.org/investor/2013/10/21/confronting-ethical-dilemmas-at-work-why-do-good-people-do-bad-things/

Pastin, M. (2013). The Different Ways People Handle Ethical Issues in the Workplace. Retrieved from https://www.bloomberg.com/news/articles/2013-11-11/the-different-ways-people-handle-ethical-issues-in-the-workplace

De Cremer, D. (2016). 6 Traits That Predict Ethical Behavior at Work  Retrieved from https://hbr.org/2016/12/6-traits-that-predict-ethical-behavior-at-work

Peloquin, A. (2015). Retrieved from https://www.careeraddict.com/report-unethical-behaviour-in-the-workplace

Kouchaki, K. and Smith, I. (2020). Building an Ethical Career Retrieved from https://hbr.org/2020/01/building-an-ethical-career

Gallo, A. (2015). How to Speak Up About Ethical Issues at Work. Retrieved from https://hbr.org/2015/06/how-to-speak-up-about-ethical-issues-at-work

Sporleder, J. (2020). How to Cultivate Ethics in the Workplace. Retrieved from https://www.payscale.com/compensation-today/2020/02/ethics-in-the-workplace

 

 

 


Saturday, August 22, 2020

Situational theory of leadership : A key to leadership effectiveness and flexibility

 

Sheena Mae P. Palaspas

Divine World College of Laoag, Ilocos Norte, Philippines

Abstract 

As Albert Einstein once said, “the measure of intelligence is the ability to change”. This is all too relevant in all organizations because if you are not changing, you are not growing. In the beginning, leadership style was only limited in two extremes: the autocratic (directive) style and the democratic (supportive) style. Autocratic leaders used position power and their authority to get results while democratic leaders used personal resources (power) and involved others in participative problem-solving and decision-making (Anonymous, 2014).  But in modern times, the mode of business, culture exchange, and communication have been improved and developed, which then changed the corporate world and all organizations at a very fast pace.

The emergence of people from different backgrounds, cultures, and nature into a single platform increases the need for leader-managers to be fully engaged to handle diverse criticalities in every situation. Thus, the leader-managers need to know the importance of being able to choose and adopt certain leadership styles to be adept with all kinds of changes and be able to maintain job satisfaction, influence, and growth that is needed by every employee in the organization. This article discusses the definition of situational leadership, a brief discussion on the description of the different situational theories of leadership, and focuses on achieving leadership flexibility.

 

Keywords: leadership, situation, situational leadership theory, flexibility

 Introduction

Situational leadership is a leadership theory that merges both directive and supportive dimensions, and each of these dimensions is needed to be applied correctly in a given situation. Leaders operating under the situational leadership theory have to assess their employees by evaluating their commitment to accomplish a certain task. (Ghazzawi, K., Shoughari, R.E., Osta, B.E., 2017). Situational leadership means that leaders have to change the degree of supportiveness and directness to their employees according to the given situation of subordinates and their level of motivation. This type of leadership demands that leaders vary their behavior and leadership style according to their subordinate’s commitment (Kindle, 2009). Situational leadership is a mixture of task behavior, worker commitment, and relation behavior. A situational leader tries to discover the characteristics of his follower to know which leadership style to use (Farmer, 2012)

Psychologists assumed that there is no optimal profile for a leader that exists, and no leader got the same characteristics as others. Therefore, different situations should be handled differently since every situation has its characteristic (Milternberger, 2011). Today’s leaders can no longer lead solely based on positional power but it is now dependent on the diversity of a given situation. Leadership is directly affecting the behaviors of communities, groups, and followers. Many theories evolved, giving birth to the different styles of leadership, and each one of these styles leads to a distinct behavior inside the organization.

Situational Leadership Models

The situational theories put emphasis not only on the personal qualities or traits of a leader but also on the situation in which he operates. A good leader is the one who molds himself according to the needs of a given situation. The following theories have been developed to recognize the situational aspects of leadership. Each theory attempts to provide an analysis of how leadership can be most successful in various situations.

 

A.     Fiedler’s Contingency Model:

Fiedler’s theory assumes leaders are predisposed to a particular set of leadership behaviors. Leaders are either task-oriented or relationship-oriented. Task-oriented leaders are directive, structured in all types of situations, sets deadlines, and focuses on making task assignments. While relationship-oriented leaders focus on people, they are considerate and are not strongly directive (Sinha, K. (2004).  

 

Fiedler suggested that three major situational variables determine whether a given situation is favorable to leaders and these are:

1.      Leader-member relations: Refers to the personal relations with the members of their group. Leader-member relations describe the quality of the relationship between subordinates and the leader. This dimension includes the amount of trust between the leader and the subordinates and whether the leader is liked and respected by the subordinates or not.

2.      Task structure: Refers to the degree of structure in the task that their group has been assigned to perform. Task Structure describes the extent to which the work is well defined and standardized or ambiguous and vague. When the task structure is high, the work is predictable and can be planned. A low task structure describes an ambiguous situation with changing circumstances and unpredictable events.

3.      Position power: Refers to the power and authority that their position provides. Position Power refers to the formal authority of the leader. A situation with high position power lets the leader hire people and directly reward or punish behavior. A leader with low position power cannot take such actions. In the latter situation, policies may constrain the leader from using any rewards or punishments.

 

Fiedler defined the favorableness of a situation as “the degree to which the situation enables the leader to exert influence over the group.” The most favorable situation for leaders to influence their groups is one in which they are well-liked by the members (good leader-member relations), have a powerful position (strong position power), and are directing a well-defined job (high task structure). On the other hand, the most unfavorable situation for leaders is one in which they are disliked, have little position power, and face an unstructured task. (Chand, S., 2020).

 

B.     Hersey-Blanchard Situational Model:

This model is based on any empirical studies of Hersey and Blanchard that the leader has to match his style with the needs of maturity of subordinates which moves in stages and has a cycle (Cherry, K., 2019). This model is also known as life cycle theory of leadership and is based on interaction among three factors or variables:

1.      Task Behavior: refers to the extent to which leaders are likely to organize and define the roles of the members of their group and to explain what activities each is to do and when, where and how tasks are to be accomplished, characterized by endeavoring to establish well-defined patterns of organization and ways of getting jobs accomplished.

2.      Relationship Behavior: Refers to the extent to which leaders are likely to maintain personal relationships between themselves and members of their group by opening up channels of communication providing socio-emotional support, active listening, and psychological strokes and facilitating the behavior.

3.      Maturity Level: Maturity is the capacity to set high but attainable goals plus the willingness and ability to take responsibility and to use education and/or experience. Ability refers to the knowledge and skills of an individual to do the job and is called Job Maturity. Willingness refers to psychological maturity and has much to do with the confidence and commitment of the individual. People tend to have varying levels of maturity depending upon the specific task, function, or objective that they are attempting to accomplish.

 

These are defined as the four stages of followers’ readiness(R):

1.      R1 – People are both unable and either unwilling or too insecure to take responsibility to do something. They are neither competent nor confident.

2.      R2 – People are unable but willing to do the necessary tasks. They are motivated but currently lack appropriate skills.

3.      R3 – People are able but unwilling or are too apprehensive to do what the leader wants.

4.      R4 – People are both able and willing to do what is asked of them. They are at a very high level of maturity.

 

According to Hersey and Blanchard, as the level of subordinate maturity increases in terms of accomplishing a the specific task, the leader should begin to reduce task behavior and increase relationship behavior. As the subordinate moves into the above-average level of maturity, the leader should decrease both task and relationship behavior. At this level of maturity, there is a reduction of close supervision and an increase in the delegation as an indication of trust and confidence.

The theory indicates that effective leadership should shift as follows:

Ø  Stage I → High task and low relationship behavior.

Ø  Stage II → High task and high relationship behavior.

Ø  Stage III → High relationship and low task behavior.

Ø  Stage IV → Low task and low relationship behavior.

 

Thus, to be effective, the manager’s style must be appropriate for each maturity level to his subordinates. According to the levels of maturity of subordinates, there are four styles’ of leadership:

1.      Telling Style (specific guidance and close supervision): Telling style emphasizes directive behavior. It is the high task and low relationship behavior stage, where the subordinates have low maturity i.e. neither they can do nor they are willing to do. These leaders make decisions and communicate them to others. They create roles and objectives and expect others to accept them. Communication is usually one way. This style is most effective in a disaster or when repetitive results are required.

2.      Selling Style (explaining and persuading):  In the second stage, which is marked by high task and high relationship behavior, subordinates require both supportive and directive behavior. Selling leadership style is appropriate for subordinates of moderate maturity i.e. high willingness but lack of ability. These leaders may create the roles and objectives for others, but they are also open to suggestions and opinions. They “sell” their ideas to others to gain cooperation.

3.      Participating Style (sharing and facilitating): In the third stage, participating style of leadership will be effective because it is a high relationship and low task behavior stage. Subordinates, in this stage, have high to moderate maturity i.e. who can do but lack the willingness to do. Thus, a high external motivating force is needed to motivate such subordinates. These leaders leave decisions to their followers. Although they may participate in the decision-making process, the ultimate choice is left to employees.

4.      Delegating Style (letting others do it): In the fourth stage, of a low task and low relationship behavior, delegating style of leadership is suitable. Subordinates in this stage are at a very high level of maturity, i.e. they have the ability as well as a willingness to work. Thus, they hardly require any leadership support. These leaders are responsible for their teams, but provide minimum guidance to workers or help to solve problems. They may be asked from time to time to help with decision-making.

Hersey-Blanchard’s model is simple and appealing. It helps the managers to determine what they should do and in what circumstances. This model has provided a training ground for developing people in organizations.

 

C.     House’s Path-Goal Theory:

Path-goal theory sees the leader’s role is one reason that is affecting a subordinate’s motivation to reach the desired goals. It states that a leader’s job is to create a work environment (through the structure, support, and rewards) that helps employees reach organizational goals. Two major roles involved are: to create a goal orientation and to improve the path towards the goal.

 

According to this theory, leaders are effective because of their impact on (followers’) motivation, ability to perform effectively, and satisfactions. The theory is called Path-Goal because its major concern is how the leader influences the (followers’) perceptions of their work goals, personal goals, and paths to goals attainment. The theory suggests that a leader’s behavior is motivating or satisfying to the degree that the behavior increases (followers’) goal attainment and clarifies the paths to these goals (Sinha, K. (2004).

 

Path-goal theory proposed the following four leader behaviors.

1.      Directive: Directive leader behavior focuses on what must be done when it must be done and how it must be done. This behavior clarifies performance expectations and the role of each subordinate in the workgroup.

2.      Supportive: Supportive leader behavior includes concern for subordinates as people and the needs they are trying to satisfy. Supportive leaders are open, warm, friendly, and approachable.

3.      Participative: Participative leader behavior includes consultation with subordinates and serious consideration of subordinates’ ideas before making decisions.

4.      Achievement-Oriented: Achievement-oriented leader behavior emphasizes excellence in subordinate performance and improvements in performance. An achievement-oriented leader sets high-performance goals and shows confidence in peoples’ abilities to reach those goals.

 

Each of the above leadership styles works well in some situations but not in others. While exercising leadership styles the leader must consider two groups of situational variables-characteristics of subordinates and work environment.

 

Characteristics of Subordinates:

Subordinate characteristics are one set of situational variables that moderate the relationship between leader behavior and the outcome variables of subordinate satisfaction and effort. Personal characteristics of employees partially determine how they will react to a leader’s behavior. For example, internally oriented employees, who believe they can control their behaviors, prefer a supportive leader. But externally oriented employees, on the other hand, prefer a directive leader as they believe that fate controls their behavior. Finally, individuals who feel that they have high levels of task-related abilities may not respond well to directive leader behavior. Instead, they may prefer an achievement-oriented style of leadership.

 

Characteristics of Work Environment:

Three broad aspects are considered in the work environment:

1.      Subordinates task-structured or unstructured,

2.      Formal authority system and

3.      Primary work group-its characteristics and stage of development.

 

These aspects of the work environment influence subordinate’s behavior concerning a particular leadership style. If the subordinates are working on a highly unstructured job characterized by a high degree of ambiguity in roles, they will require directive leadership behavior. Subordinates working in a low ambiguity situation can see what must be done and how to do the task. Directive leadership in this case will be redundant; rather it could reduce satisfaction and motivation. A better leadership style in this situation will be supportive.

 

Thus, the theory proposes that there is nothing like the best leadership style appropriate in all situations. Appropriate style is one that helps the subordinates cope with the environmental ambiguity. A leader who can reduce uncertainties of the task and sets clear paths is considered to be satisfying because he increases the expectations of the subordinates that their efforts will lead to desired results.

 

D.     Vroom-Yetton and Jago’s Contingency Model:

The contingency model developed by Victor Vroom and Phillip Yetton is based on a model commonly used by researchers who take a contingency approach to leadership. Vroom and Yetton were later joined by Arther Jago in the development of this model which emphasizes the role played by leaders in making decisions.

 

The model focuses on the degree to which employees should be allowed to participate in decisions. Three factors that are to be considered for this purpose are decision quality, decision acceptance and decision timing (Jago, A.G., Vroom, V.H., 2007).

1.      Quality of a decision is highest when the best alternative is chosen, independent of the effects that may be associated with the necessity that the decision is accepted by subordinates.

2.      Decision acceptance is important whenever a decision has implications for subordinates’ work motivation and whenever a decision must be implemented by subordinates.

3.      Decision timing plays an important role whenever timing uses constraints on decisions.

 

The Vroom-Yetton model is based on the assumption that situational variables interacting with personal attributes or characteristics of the leader result in leader behavior that can affect organizational effectiveness. According to Vroom Vetten and Jago model leaders with multiple subordinates have five basic decision styles available:

1.      AI. The leader makes the decision or solves the problem himself, using information available to him at the time.

2.      All. The leader obtains the information from his subordinates, then decide on the solution to the problem himself. The subordinates act only as of the information source. They may not be told what the problem is while getting information from them.

3.      CI. The leader shares the problem with the subordinates individually, getting their ideas and suggestions without bringing them together as a group. Then he makes the decision that may or may not reflect the influence of the subordinate.

4.      CII. The problem is shared with the subordinates as a group, collectively obtaining the ideas and suggestions. Then, the leader makes the decision that may or may not reflect the group’s influence.

5.      GII. The leader and subordinates meet as a group to discuss the problem, and the group makes the decision. The manager accepts and implements any solution which has the support of the entire group.

 

The Vroom-Vetten-Jago-decision model of leadership provides the leader with, in effect, a decision tree to help him choose an effective decision-making style. The decision process involves answering a lot of questions about the nature of the problem. After working his way through the decision tree, the leader selects the style that is most appropriate for the situation. The following questions relating to the problem attributes include:

a.       Is there a quality requirement such that one situation is likely to be more rational than another? (Quality Requirement)

b.      Does the leader have sufficient information to make a high-quality decision? (Leader’s information)

c.       Is the problem structured? (Problem structure)

d.      Is acceptance of the leader’s decision by the subordinates critical to effective implementation? (Commitment requirements)

e.       If the leader were to decide by himself, will it be accepted by the subordinates? (Commitment probability)

f.       Do subordinates’ share the organizational goals to be obtained in solving the problem? (Goal congruence)

g.      Does conflict among subordinates likely to occur in preferred solutions? (Subordinate conflict)

 

Despite some criticisms and limitations of these situational leadership theories, we cannot deny that it has made a significant contribution to the present leadership approaches. From these leadership models and styles, we can say that there is no absolute model that can be used in an organization because every employee in an organization is diverse and each needs a different form of management and leadership style to be applied to bring out the best in them

The difference between situational leadership and other leadership styles is that situational leadership incorporates many different techniques. The style of choice depends upon the organization’s environment and the competence and commitment of its followers. Thus, leaders must weigh many variables in their workplace and choose the leadership style that best fits their goals and circumstances.

Flexibility in Leadership

Flexibility is an increasingly important trait in a rapidly changing economic and social environment. Flexible leaders are those who can modify their style or approach to leadership in response to uncertain or unpredictable circumstances (Anderson, B. 2011). Besides, flexible leaders can adapt to changes as they come. They can revise their plans to incorporate innovations and overcome challenges, while still achieving their goals. Flexibility is not only about surviving and thriving in new situations. Adaptable leaders can also implement new behaviors into old, existing situations. This allows them to express creativity in their work and find new ways to solve problems. Flexibility is the willingness to try new behaviors, regardless of whether one is currently undergoing a time of change in their company (Yukl, G. & Mahsud, R. 2010).

 

Concerning this, we can say that situational leadership is more of a flexible leadership approach. It is a relationship-oriented leadership and bases the directives of the leader on the ability and readiness of the followers. To get through the situation, the leader must develop a good relationship or rapport with the team members so that he can understand their state of mind when receiving directions for the tasks they need to complete. Situational leadership also evaluates the maturity levels of the people within the organization as well as the tasks they are set and their level of competency (World, T.E. 2019). It would be suicide to introduce a novice and let them get on with a highly complicated task that requires years of training to become competent in. This person would soon become unhappy, stressed, and demotivated. In the same way, it will detriment the productivity and morale of a team member who is so competent at a task that they can easily do it quickly, efficiently, and competently, but they are still being micro-managed. This scenario will lead to feelings from the individual of being stifled in development and not trusted for every task given (Anonymous, 2016).

 

Furthermore, situational leadership involves right thinking and right working in the situation prevailing with competency and commitment; and in “doing” things right, turning around situations if necessary, and obtaining better performance from people for results.  In other words, he adopts various developmental and supporting style, with flexibility and commitment, and integrity in all kinds of situations.

 

With these, it is important to note that, being open to new behaviors is not enough to make an effective flexible leader in addressing a certain situation. Thus, leaders need to recognize first the situations in which their old behaviors are not working. Next, they need to decide how to approach the problem, including what new behaviors or approaches are feasible, and which will accomplish their goals within the restraints of their situation. Finally, once a new path is decided upon, flexible leaders need to be able to assess the current success and progress of their new behaviors and re-evaluate or further modify unsuccessful behaviors.


Flexibility is critical for effective leadership to take place. The critical thing to do is to lead and manage individuals effectively so they can work in harmony with the team and achieve the objectives set. It is also imperative for leaders to appropriately respond in the constantly evolving working environment and to sharpen their ability to determine which leadership style is needed to be applied to a specific scenario. This is where good leaders stand apart, they are the ones who assess and analyze the situation first and the behavior of employees before acting on it the way things need to be done.


Conclusion

Situational leadership can be used as a framework to give leaders the guidance that they need to coach their people throughout the performance coaching cycle. The discussed situational theories of leadership suggest that there is no ‘one size fits all’ style suited to every situation and there is no single leadership style that is the best (Heatley, S. 2018). Determining the best-suited type of leadership and strategies are dependent on the varying task and situation that is present. The most effective leaders are those that can adapt their style to the situation, collaborate available leadership styles, and look at the cues such as the type of task, the nature of the group, and other factors that might contribute to getting the job done. When choosing a leadership style, it is important to understand the different frameworks, so you can develop your way of becoming a flexible and effective leader.

A successful situation leader effectively partners with people within the organization. He set clear goals and can enlist the right support and advice from others. He builds teams and task-forces of people with commitment around him. Utilizing and building upon the human resources offering entrepreneurial skills and capabilities. Knowing that everyone has some peak performance potential, the leader needs to know where they are coming from and meets them there for results. 

There are no good and bad leadership theories, but there are leadership styles that work best for certain situations, tasks, and people (Chris, J. 2015).  To be an effective and flexible leader, regardless of one’s leadership approach or style that is adopted, one must be able to assess first the current situation properly, choose and apply the best style for the situation at hand and review and re-evaluate one’s choice continuously to address any loopholes in the current leadership style being used.  Much like a chameleon that can quickly change their color to suit their surroundings to survive and thrive, a leader must be able to quickly change their style to suit their surroundings to influence and lead others. Successful leadership requires the ability to quickly make changes to lead in ways that work for their followers. To do this, leaders should use a multi-directional model to ensure they communicate effectively and adopt the right style of direction that a follower requires to complete any given task.

References

 

Anderson, B. (2011). Great Leaders Are Flexible. Retrieved from https://www.sigmaassessmentsystems.com/flexible-leader/. Retrieved on July 31, 2020.

GBS-Corporate. (2014). What Is Situational Leadership? How Flexibility Leads to Success. Retrieved from https://www.gbscorporate.com/blog/situational-leadership-how-flexibility-leads-to-success. Retrieved on August 1, 2020.

Educational Business. (2016). Situational Leadership Theory: Providing Leadership through Flexibility. https://www.educational-business-articles.com/situational-leadership-theory/. Retrieved on August 1, 2020.

Chand, S. (2020). Situation leadership theory: a test from three perspectives. Retrieved from https://www.yourarticlelibrary.com/leadership/situationalcontingency-approaches-to-leadership/28007. Retrieved on August 8, 2020.

Cherry, K. (2019). The Situational Theory of Leadership. Retrieved from https://www.verywellmind.com/what-is-the-situational-theory-of-leadership-2795321. Retrieved on August 8, 2020.

Chris, J. (2015). 6 Situational Leadership Style Examples. Retrieved from http://www.josephchris.com/6-situational-leadership-style-examples. Retrieved on July 31, 2020.

Farmer, L. (2012). Situational Leadership: A model for leading telecommuters. Journal of Nursing Management.

Ghazzawi, K., Shoughari, R.E., Osta, B.E., (2017). Situational Leadership and Its Effectiveness in Rising Employees Productivity: A Study on North Lebanon Organization. Retrieved from http://article.sapub.org/10.5923.j.hrmr.20170703.02.html. Retrieved on: August 8, 2020

Heatley, S. (2018). What is situational leadership and why is it hot right now?. Retrieved from https://www.perkbox.com/uk/resources/blog/what-is-situational-leadership-and-why-is-it-hot-right-now. Retrieved on July 31, 2020.

Jago, A.G., Vroom, V.H., (2007). The Role of the Situation in Leadership. Retrieved from http://web.mit.edu/curhan/www/docs/Articles/15341_Readings/Leadership/Vroom_Jago_2007_The_role_of_the_situtation_in_leadership.pdf. Retrieved on July 31, 2020.

Kindle. (2009). Leadership: Theory and Practice. Kindle Edition.

Milternberger, R. (2004). Behavior Modification Principles and Procedures. Behavior Modification. (p 74-150)

Sinha, K. (2004). Situational Contingency Theory of Leadership (With Diagram). Retrieved from https://www.yourarticlelibrary.com/leadership/situational-contingency-theory-of-leadership-with-diagram/64024. Retrieved on August 8, 2020

World, T.E. (2019). Situational Leadership and How Flexibility Leads to Success. https://www.theenterpriseworld.com/situational-leadership-and-how-flexibility-leads-to-success/. Retrieved on July 31, 2020.

Yukl, G. & Mahsud, R. (2010). Why flexible and adaptive leadership is essential. Consulting Psychology Journal: Practice and Research, 62(2), 81-93.

 

 

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