Theories of leadership — practice questions

Situational analysis: The team has low competence + low confidence. According to Hersey and Blanchard's model, this corresponds to the R1 (unable and unwilling) readiness level. This requires a high task, low relationship ('Telling' or 'Directing') style initially to provide clear instructions and supervise closely.

Initial Actions (Directing Style):

1. Set clear, achievable daily targets.
2. Provide detailed instructions for tasks.
3. Monitor performance closely and provide immediate feedback.

Transition Plan: As the team's skills improve (moving to R2 - unable but willing), the manager should transition to a high task, high relationship ('Selling' or 'Coaching') style. This involves explaining decisions and providing opportunities for clarification to build confidence.

Evaluation: A purely laissez-faire style would worsen the chaos. A purely transformational style might fail initially because the team lacks the basic skills and discipline to act on a vision. A situational approach allows the manager to adapt their style as the team develops, making it the most appropriate choice.

Step 1: Identify and analyse the current leadership style. Priya's scores of (8, 2) on the Blake Mouton Grid place her in the 'Authority-Obedience' (or 'Produce-or-Perish') quadrant. This style prioritises task completion over employee well-being, which explains the high productivity targets but also the low morale and high staff turnover.

Step 2: Quantify the current problem.

• Productivity Loss: The team's target output is valued at $150,000 per quarter. A 20% drop in productivity represents a financial loss. $\text{Productivity Loss} = \text{\textdollar}150,000 \times 20\% = \text{\textdollar}30,000 \text{ per quarter}$
• Turnover Cost: The cost to replace one skilled developer (recruitment, training, lost output) is estimated at $25,000. Two developers have resigned. $\text{Turnover Cost} = 2 \times \text{\textdollar}25,000 = \text{\textdollar}50,000$
• Total Quarterly Loss: $\text{Total Loss} = \text{\textdollar}30,000 + \text{\textdollar}50,000 = \text{\textdollar}80,000$

Step 3: Recommend a change in leadership style. Based on the Blake Mouton model, Priya should aim for a 'Team Management' style (9, 9), which shows high concern for both production and people. This involves fostering collaboration, seeking input, and supporting team members' development while maintaining high standards.

Step 4: Project the potential financial improvement. Assume that by adopting a 'Team Management' style, productivity can be restored to its target level, and future turnover can be prevented in the next quarter.

• Productivity Gain: The $30,000 quarterly loss is eliminated.
• Avoided Turnover Cost: The $50,000 cost of replacing staff is avoided in the next quarter.
• Projected Net Gain: The recommended change could lead to a financial improvement of $80,000 in the following quarter compared to the current trajectory.