CHAPTER 6
Knowledge management
and the learning
organisation
6.1. Knowledge management
● “Knowledge management” ~ information-technology management and
referred to systems such as intranets.
● Classified into 2 types:
- Based on computers and technology
- Based on people and human networks
● Table 6.1 P. 152 shows how consulting firms manage their knowledge
under codified versus personalised strategies
6.1.1. Knowledge management benefits
1. Knowledge management as a business strategy: knowledge can be an
integral part of the products and processed that give the organisation
a competitive advantage.
1. Innovation and knowledge creation: knowledge management is key
to new products, rapid commercialisation and renewing and adapting
unique knowledge and expertise.
3. Transfer of knowledge and best practice
4. Customer-focused knowledge: building customer intimacy and working
with them to make them successful
5. Intellectual asset management: realising the value of intellectual assets
6. Personal responsibility for knowledge: it encourages individual learning
and development
6.2. Leading knowledge workers
● “Knowledge economy” is an economy in which a substantial
percentage of the work undertaken by organisations (and the people
in them) concerns the generation, documentation, transfer and
creation of knowledge.
● A “knowledge worker” is therefore someone whose primary role
consists of the capture, manipulation and application of knowledge.
● 6 major issues that have to be addressed to maximise the benefit of
the knowledge that workers create and use
1. The exact task of knowledge workers.
2. Responsibility and autonomy..
3. Continuing innovation and creativity.
4. Learning and teaching.
5. Quality.
6. Knowledge worker as an asset.
6.2.1. Knowledge leadership
● To motivate a knowledge worker the leader needs to ensure that the
knowledge worker understands and agrees with the core values and
mission of the organisation.
● Leader must determine goals and aspirations of the knowledge
worker and what do they see as successful results for them and for
the organisation, capitalise on their strengths and their knowledge.
6.3. The learning organisation
● A learning organisation can be looked upon simply as a group of
people working together to enhance their capacities to create results
they value
6.3.1. Systems thinking
● The art of systems thinking is to see through the complexity.
6.3.2. Personal mastery
● Personal mastery is the discipline of personal growth and learning
● Characteristics enables people to develop:
- A special sense of purpose that lies behind their vision and goals
- See current reality as an ally not an enemy
- Be deeply inquisitive, committed to seeing reality more accurately
- Feel connected to others
- Live in a continual learning mode
- Be aware of their ignorance, their incompetence and their growth
areas
6.3.3. Mental models
● Mental models are essential and ever-present ways in which we deal
with the complexity of the world around us.
● Mental models shape how we act, affect what we see.
● Mental models is a critical role of leaders to challenge existing mental
models, to free up people to see different alternatives and ways of
doing so.
CHAPTER 7
Contingency and
situational leadership
7.1. Situational influences on effective leadership
behavior
● The essence of a contingency approach to leadership is that leaders
are most effective when they make their behavior contingent upon
situational forces, including group member characteristics.
● The internal and the external environment have a significant impact
on leader effectiveness.
7.2. Fiedler's contingency theory of leadership
effectiveness
7.2.1. Measuring leadership style : the least preferred co-
worker (LPC) scale
● Leadership style is a relatively permanent aspect of behavior and thus
difficult to modify.
● A manager's leadership style is classified as relationship-motivated or
task-motivated.
7.2.2. Measuring the leadership situation
● Fiedler's contingency theory classifies situations as high, moderate and
low control.
● Three dimensions to rate the situation :
1. Leader-member relations : how well the group and the leader get along.
2. Task structure : how clearly the procedures, goals and evaluation of the
job are defined.
3. Position power : the leader’s authority to hire, fire, discipline, and grant
salary increases to group members.
Relationship-motivated Task-motivated leaders
leaders
Describing the least preferred Describing a co-worker in an
co-worker in relatively unfavourable manner.
favourable terms.
7.2.3. The leader-match concept and overall findings
● Task-motivated leaders perform the best in situations of high control
and low control.
● Relationship-motivated leaders perform the best in situations of
moderate control.
● Socio Independent leaders perform the best in situations of high control.
Task-motivated Relationship-
leaders motivated leaders
Give emotional
Structure and make
support to group
Behavior sense out of
members or call a
confusion
meeting
Work on
Not being concerned
relationships and not
Reason with the task and can
get involved in
work on relationships
overmanaging
7.2.4. Making the situation more favourable for
the leader
To increase control over the situation, leader can do one or more of the
following:
● Improve leader-member relations and being a nice person.
● Increase task structure by engaging in behavior related to initiating
structure.
● Exercise more position power by requesting more formal authority
from higher management.
7.2.4. Evaluation of Fiedler's contingency theory
● Advantage :
The basis for leadership training programs.
Alerting leaders importance of sizing up the situation to gain control.
● Disadvantage :
Too complicated to have much of an impact on most leaders.
Matching the situation to the leader.
● A positive conclusion : the studies of leadership effectiveness
conducted within the various octants.
● A negative conclusion : it's difficult to make generalizations
about leadership performance when leaders are compared
from one situation to another.
7.3. The path-goal theory of leadership effectiveness
● Definition : what the leader must do to achieve high productivity
and morale in a given situation.
● Two key aspects :
Matching the leadership style to the situation.
Steps the leader can take to influence performance and satisfaction.
Key features Characteristics of group
members
Contingency factors
LEADERSHIP STYLE
Directive OUTCOMES
Supportive Productivity
Participative Morale
Achievement-oriented
Demands of the task Contingency factors
*Figure 7.2
7.3.1. Matching the leadership style to the situation
● Two important sets of contingency factors :
1. The type of work they perform.
2. The type of subordinate.
● Three classifications of contingency factors in the environment :
1. The group members' tasks.
2. The authority system within the organization.
3. The work group.
4 styles fit contingency factors :
1. Directive style : he or she emphasis formal activities such as planning,
organizing, controlling and improves morale.
2. Supportive style : he or she displays concerned for group's members
well-being and creates an emotionally supportive climate ; enhances
morale.
3. Participative style : he or she consults with group members to gather
their suggestions and then takes the suggestions seriously when
making a decision.
4. Achievement-oriented style : he or she sets challenging goals, pushes
for work improvement and sets high expectations for team members.
7.3.2. How the leader influences performance
Suggestions relate to motivation and satisfaction :
1. Recognize or activate group members’ needs over which the leader has
control.
2. Increase the personal payoffs to team members for attaining work goals.
3. Make the paths to payoffs easier by coaching and providing direction.
4. Help group members clarify the expectations of how effort will lead to
good performance and how performance will lead to a reward.
5. Reduce frustrating barriers to reaching goals.
6. Increase opportunities for personal satisfaction if the group member
performs effectively.
7. Be careful not to irritate people by giving them instructions on things
they already can do well
8. To obtain high performance and satisfaction the leader must provide
structure if it is missing and must also supply rewards contingent upon
adequate performance.
7.4. The Hersey-Blanchard situational leadership model
The situational leadership model explains how to match the
leadership style to the readiness of the group members.
7.4.1. Basics of the model
Leadership style in the situational model is classified according to the
relative amount of task and relationship behavior the leader engages in.
● Task behavior : the extent to which the leader spells out the duties
and responsibilities of an individual or group.
● Relationship behavior : the extent to which the leader engages in
two-way or multiway communication.
The situational model has four quadrants and each one calls for a
different style :
● Style 1 - High task and low relationship.
● Style 2 - High task and high relationship.
● Style 3 - High relationship and low task.
● Style 4 - Low relationship and low task.
● Readiness : the extent to which a group member has the ability and
willingness or confidence to accomplish a specific task.
● Ability : the knowledge, experience, and skill an individual or group
brings to a particular task or activity.
● Willingness : the extent to which an individual or group has the
confidence,commitment, and motivation to accomplish a specific
task.
Guidelines for the leader to follow
Situation R1 Situation R2 Situation R3 Situation R4
Low readiness Moderate Moderate to high High readiness
readiness readiness
Emphasizing task- Being more Providing a high Granting them
oriented behavior relationship-oriented degree of considerable
relationship-oriented autonomy
Being very directive A selling style behavior but a low
and autocratic degree of task A delegating style
behavior
A telling style
A participating style
7.4.2. Evaluation of the situational model of leadership
The situational model :
● Represents a consensus of thinking about leadership behaviour.
● Justifies using different styles of leadership for different model.
● Suggests the necessity of adjusting your leadership style.
You can benefit from this by attempting to diagnose the readiness
of group members before choosing the right leadership style.
7.5. The normative decision model of Vroom,Yetton
and Jago
● The normative decision model views leadership as a decision-
making process and specifies what a leader ought to do in a given
situation.
● Normative : the idea that the leader should follow certain
prescriptions indicated in the model.
● Two major factors influence decision making : decision quality and
decision acceptance.
7.5.1. Decision quality and decision acceptance
● Decision quality : the objective aspects of a decision that affect
group or individual performance.
● Decision quality will be higher when group members possess
relevant information and are willing to cooperate with the leader
in making a good decision.
● Decision acceptance : how committed group members are to
implementing a decision effectively.
● If group members are responsible for implementing a decision,
acceptance is crucial.
● Many intelligent decisions result in no organisational improvement
because group members resist their implementation.
7.5.2. Decision-making styles and the decision tree
● The Vroom-Yetton-Jago model identifies five decision-making styles,
each reflecting a different degree of participation by group
members.
● On the basis of those variables, the manager follows the paths
through a decision tree to take action.
● The model has four decision trees :
1. Two for group-level decisions
2. Two for individual-level decisions
Decision-making style Description
Leaders solves problem alone, using information that is readily
Autocratic I (AI)
available
Leader obtains additional information from group members, then
Autocratic II (AII)
makes decision alone.Group members may or may not be informed
Leader shares problem with group members individually and asks
Consultative I (CI) for information and evaluation.Group members do not meet
collectively and leader makes decision alone
Leader shares problem with group members collectively but makes
Consultative II (CII)
decision alone
Leader meets with group to discuss situation.Leader focuses and
Group II (GII) directs discussion, but does not impose will.Group makes final
decision
7.5.3. An illustrative use of the model
1.QR node How important is the quality of the decision ?
How important is a subordinate commitment to
2.CR node
the decision ?
Do I have sufficient information to make a
3.LI node
high-quality decision ?
4.ST node Is the problem well-structured ?
If I were to make the decision by myself, is it
5.CP node
reasonably certain that my subordinate(s) would be
committed to the decision ?
The normative decision model :
● Quality requirement : How important is the technical quality of this
decision ?
● Commitment requirement : How important is subordinate commitment
to the decision ?
● Leader’s information : Do you have sufficient information to make a
high-quality decision ?
● Problem structure : Is the problem well structured ?
● Commitment probability : If you were to make the decision by
yourself, is it reasonably certain that your subordinate would be
committed to the decision ?
● Goals congruence : Do subordinates share the organizational goals to
be attained in solving this problem ?
● Subordinate conflict : Is conflict among subordinates over preferred
solutions likely ?
● Subordinate information : Do subordinates have sufficient information
to have make a high-quality decision ?
7.5.4. Evidence and opinion about the model
● The model predicts accurately the type of decisions practising
managers make and provides a valuable service which prompts them to
ask intelligent and perceptive questions about decision-making
situations.
● The normative decision model can be criticised on the same grounds as
other contingency models.All of them pay scant attention to the major
elements of leadership but they are more about management than
about leadership.
7.6. Other contingency theories and models
7.6.1. Leadership substitution theory
● The model identifies aspects of the situation that reduce the importance
of leadership.
● It has two types of situational variables : substitutes and neutralisers.
1. Substitutes : all characteristics of the team members, tasks being
undertaken or the organisation that leads team members to clearly
understand their roles and be satisfied with them
2. Neutralisers : characteristics prevent a leader from acting in a particular
way or cancel the effects of a leader’s actions
● The model is still relatively unsupported and lacks casual processes
like those of some other contingency models.
7.6.2. The multiple-linkage model
● The model emphasises leadership processes at the group level
rather than at the dyadic level.
● Six intervening variables in the model :
1. Ask commitment
2. Ability and role clarity
3. Organisation of the work
4. Cooperation and mutual trust
5. Resources and support
6. External coordination
● These variable interact with each other to determine the overall
effectiveness of the work unit.
● The model also provides a good conceptual framework for
leaders.
7.7. Cognitive resource theory : how intelligence,
experience and stress influence leadership
● The general thrust : stress plays a key role in determining how a
leader’s intelligence is related to a group performance
● Predictions made by the cognitive resource theory :
Ability / characteristics Reason
Leaders with greater experience but lower
Experienced leaders have a larger variety
intelligent have higher performing groups
of behavior to fall back on.
under high-stress conditions.
Experience leads to habitual behavior
Leaders with high intelligence are more patterns.
valuable than experienced leaders when
innovation is needed and stress levels are Highly experienced leaders use old
low. solutions to problems when creativity is
necessary.
Measures of leader intelligence and If a leader is experiencing stress, his or her
competence won't correlate with group intellectual abilities will be diverted from
performance when the leader is stressed. the task at hand.
The directive leader provides more ideas
The intellectual abilities of directive leaders and suggestions to the group.
will correlate more highly with group
performance than those of nondirective The nondirected leader is more likely to
leaders. urge the group member to be more self-
reliant.
Intelligent leaders devise better plans for A leader's intellectual abilities will be
doing the work then less intelligent related to group performance to the
leaders, especially when the plan is degree that the task requires the use of
complex. intellectual ability.
7.8. Contingency leadership in the executive suite
● A leadership approach is a coherent, explicit style of management,
not a personal style but it still centres on leadership behavior.
● Five distinct approaches : strategic, human assets, expertise, box and
change agent.
● An outline of the approaches and accompanying contingency factors
CEO leadership approach Contingency factors
Strategic (create, test, and design long- Unstable environment, high rate of
term strategy) change,complexity
Human assets (add value through hiring, Business units are better positioned than
inventions and development program) headquarters to make strategy
Expertise (design and implement programs
Certain expertise can be source of
around specific expertise such as
significant competitive advantage
technology)
Presence of government examiners who
Box (add values through controls that set
insist on strict controls to protect
boundaries for employee performance)
consumer and company
Change agent (create an environment of Company wants to remain a leader in the
continual reinvention) field, and status quo is unacceptable
● The strategic approach is a systematic, dispassionate and structured
analysis of a company's strengths and weakness and its mission.
● It should be used in unstable environments in which the volume and
pace of change are high.
● It is often chosen by CEOs who must frequently make decisions of
enormous consequence.
● The human assets approach : add value to the organisation through
hiring, retention, and development programs.
● Its important goal is to develop business unit managers to the point at
which they act and make decisions the way CEO woud.
● It is most frequently used when a company has far-flung operations.
● The expertise approach : select and disseminate throughout the
organisation an area of expertise that give the firm a competitive
advantage.
● Areas of expertise : marketing, manufacturing, technology and
distribution.
● A key contingency factor for favouring the expertise approach is
whether a certain expertise can give the firm a significant competitive
advantage.
● The box approach : when the corporate adds value by creating,
communicating, and overseeing an explicit set of controls.
● The controls : financial measures, rules, procedures, values.
● The purpose of these controls : ensure uniform and predictable
experiences for employees and customers and to lower risk.
● A key contingency factor favouring the box approach is a regulated
environment.
● The change agent approach : create an environment of continual
reinvention.
● Change agent executives regularly visit factories, create and answer
email, and attend company picnics.
● The approach appears to be triggered when theo CEO believes that the
status quo will lead to the company’s undoing.
