ImportNCE of Emotional

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Supervisor:Frances Jrgensen

Aarhus School of Business Master ThesisUniversity of Aarhus August 2008

Emotional IntelligenceThe Importance of Emotional Intelligence in the Recruitment Process

Margrt Grtarsdttir280040


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Emotional Intelligence

2

Executive Summary

The idea with this paper is to investigate the termemotional intelligenceand its importance

during the recruitment process. Over the last few decades a continuous growth has been in the

interest in the area of leadership, with both managers and leadership researchers trying to

identify the behaviour which increases a leaders effectiveness. Despite of research, there

appears to be little emerging consensus regarding what characterises an effective leader. It

also seems to be quite common to recruit managers on the basis of their technical

qualifications rather than their ability to communicate with others which could be prevented,

or at least minimised, by taking so called soft management procedures (focus on the

personal aspects in working environment) into considerations during the recruitment process.

Recently, emotional intelligence as a predictor of effective leadership has gained the attention

of researchers and recruiters. Emotional intelligence can be generally defined as a set of non-

cognitive competencies that are linked to interpersonal effectiveness or people skills at

work. More specifically, emotional intelligence includes the ability to monitor ones own and

others feelings and emotions, to discriminate among them, and to use that information to

guide ones thinking and actions. Emotional intelligence has become extremely popular

within the fields of management because it is thought to underlie various aspects of workplace

performance and success not accounted for by traditional intelligence measures or personality.

The research question put forward in the paper is: to what degree are managers recruited

and selected on the basis of emotional characteristics versus technical qualification? In

order to connect theories of emotional intelligence with reality interviews were conducted

with six HR managers of different companies in Iceland. They were all asked the same ten

questions and the findings indicate that managers are being recruited on the basis of their

emotional intelligence characteristics rather than technical qualifications but that the best

combination would be good people skills as well as good technical qualifications. Grades

were also mentioned in connection to this which contradicts the theories that this paper wasbased on. According to researchers David McClelland and Daniel Goleman grades in school

and IQ do not indicate how likely it is that an individual will succeed in life and at a work

place.


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No evaluation measure gives perfect results. Self-evaluations are vulnerable to skews from

people wanting to look good. Therefore, when it comes to assessing emotional competencies,

there is always the danger that a person with low self-esteem does not evaluate accurately his

or her own strengths and weaknesses. Even though self-evaluations can be helpful, if people

really trust that the results will be used for their own good, they can be less reliable withoutthis trust. Having emotionally intelligent managers does not guarantee that the company gains

more market share or a better bottom line but research throughout the years have indicated

how important the human mind is for the growth of organisations and therefore soft

management like emotional intelligence has gained increased popularity.

The outline of this paper is twofold; the first two chapters cover theories of traditional

management and leadership and the main chapters cover the concept of emotional

intelligence, both in theory and practice. It is important to understand the evolution of

management because management problems remain mostly the same over time. While value

systems and perspectives may have changed, experts have gained a better understanding of

what motivates employees.

In the beginning of the twentieth century Mary Parker Follett pointed out in her behavioural

theory that the role of the manager and his influence on employees was becoming more and

more important. Henry Fayol argued that leaders emerged from managers authority derived

from their position in the hierarchy but Follett proposed that knowledge and expertise should

decide who would be the leader at any particular moment. Characteristics of managers are

very personal but they are very important for understanding how managers behave, how they

treat and respond to others and how they help contribute to organisational effectiveness

through the four managerial functions; planning, leading, organising and controlling.

When people approach tasks in life with emotional intelligence they should be at an

advantage to solving problems. The kind of problems that people identify and the way theyhandle them will probably be more related to internal emotional experience. Such individuals

are more likely to choose a career that will make them happy instead of thinking how much

they will earn and they are also more likely to be more creative and flexible in arriving at

possible alternatives to problems. Individuals who have developed skills related to emotional


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intelligence understand and express their own emotions, recognise the emotions of others and

they also use moods and emotions to motivate adaptive behaviour.

A person with emotional intelligence can be thought of as having attained at least some form

of positive mental health. These individuals are aware of their own feelings and those of

others, are open to positive and negative aspects of internal experience and are able to

communicate them when appropriate. This leads to the fact that an emotionally intelligent

person is often a pleasure to be around, has good influence and makes others feel better. This

person however does not mindlessly seek pleasure, but rather attends to emotions which lead

to growth.

People are being judged by new yardsticks and it is not how smart they are or what kind of

education they have or expertise, more focus is on how people handle themselves and others.This yardstick is becoming more important and is increasingly applied when choosing whom

to hire. This new measurement focuses on personal qualities but takes for granted peoples

intellectual abilities and technical skills. Emotional intelligence is even more crucial today,

because organisations are shrinking and the people who remain are more accountable and

visible.


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Introduction ................................................................................................................................ 61. Traditional Management ........................................................................................................ 9

1.1 Theoretical Scope of Management......................................................................................................111.2 Management Theories.........................................................................................................................13

1.2.1 The Universal Process Approach.................................................................................................141.2.2 The Operational Approach...........................................................................................................161.2.3 The Behavioural Approach..........................................................................................................181.2.4 The Systems Approach................................................................................................................201.2.5 The Contingency Approach.........................................................................................................211.2.6 The Attributes of Excellence Approach.......................................................................................22

2. Leadership ............................................................................................................................ 242.1 Models of Leadership..........................................................................................................................27

2.1.1 The Trait Theory..........................................................................................................................272.1.2 The Behaviour Theory.................................................................................................................282.1.3 The Contingency Theory.............................................................................................................282.1.4 The Transformational Theory......................................................................................................29

2.2. Management vs. Leadership...............................................................................................................302.3. The Human Side of Managers............................................................................................................32

3. Emotional Intelligence ......................................................................................................... 35

3.1 Theoretical Scope of Emotional Intelligence.......................................................................................373.2 Models of Emotional Intelligence........................................................................................................41

3.2.1 The Abilities Model.....................................................................................................................423.2.2 The Mixed Model........................................................................................................................43

3.3 Emotional Intelligence and Its Effect on Leadership............................................................................463.4. Emotional Intelligence and the Recruitment Process..........................................................................47

3.4.1. The Selection Process.................................................................................................................484. Emotional Intelligence in Reality ......................................................................................... 50

4.1 Business Research Methods................................................................................................................514.2 The Research Method..........................................................................................................................524.3 The Process of the Interviews..............................................................................................................54

4.3.1 Participants..................................................................................................................................544.3.2 The Interviews.............................................................................................................................554.2 Findings of the Interviews...................................................................................................................57

4.3 Analysis of Findings............................................................................................................................595. Discussion of Findings ......................................................................................................... 62

5.1 Evaluation of Methods and Findings...................................................................................................646. Conclusion ............................................................................................................................ 65Bibliography ............................................................................................................................. 67Appendix 1 ............................................................................................................................... 70Appendix 2 ............................................................................................................................... 72Appendix 3 ............................................................................................................................... 74Appendix 4 ............................................................................................................................... 76Appendix 5 ............................................................................................................................... 78Appendix 6 ............................................................................................................................... 80Appendix 7 ............................................................................................................................... 82Appendix 8 ............................................................................................................................... 84


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Introduction

During the last few decades a continuous growth has been in the interest in the area of

leadership, with both managers and leadership researchers searching to identify the behaviour

which increases a leaders effectiveness. Despite of research, there appears to be little

emerging consensus regarding what characterises an effective leader. Recently, emotional

intelligence as a predictor of effective leadership has gained the attention of researchers and

recruiters. Emotional intelligence can be generally defined as a set of non-cognitive

competencies that are linked to interpersonal effectiveness or people skills at work. More

specifically, emotional intelligence includes the ability to monitor ones own and others

feelings and emotions, to discriminate among them, and to use that information to guide ones

thinking and actions.1

Emotional intelligence has become extremely popular within the fields of management

because it is thought to underlie various aspects of workplace performance and success not

accounted for by traditional intelligence measures or personality. Several studies highlight

that traditional forms of intelligence only account for twenty percent of overall success at

work.2 That leaves eighty percent of the variance unaccounted for. With personality and

motivational measures approximately contributing another ten percent to the puzzle, there still

seems to be a lot that is unknown about what makes some individuals perform better or why

some people are always a step ahead. Therefore, measuring emotional intelligence or the

softer skills, as they are often known, could explain what differentiates between who will be

an effective leader and who will not.

In todays competitive business world, where the higher education level of many leaders

and managers is increasing, emotional intelligence has the potential to become a core

differentiator in terms of selecting the best leaders for organisations. Lack of interpersonal

skills can have tremendous influence over the career prospects of highly intelligent, qualified,

and experienced professionals and can easily destroy them. Scoring high on IQ tests and

1 Salovey and Mayer (1990)2 Goleman (1995)


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getting high grades in school counts for little if the individual has difficulty in dealing with

e.g. uncertainty and pressure at work and handles relationship with others badly.3

This paper is about emotional intelligence and to what degree managers are recruited and

selected on the basis of emotional intelligence characteristics versus technical qualification. Itis important to understand the evolution of management because management problems

remain mostly the same over time. While value systems and perspectives may have changed,

experts have gained a better understanding of what motivates employees. In the first chapter

the concept of management is defined and various theories are covered in order to see how

they have developed, where the human mind was considered valuable and made a difference.

In the beginning of the twentieth century Mary Parker Follett pointed out in her behavioural

theory that the role of the manager and his influence on employees was becoming more and

more important. Henry Fayol argued that leaders emerged from managers authority derived

from their position in the hierarchy but Follett proposed that knowledge and expertise should

decide who would be the leader at any particular moment.4 With this in mind the second

chapter is focused on leadership as more and more managers are becoming aware of how

important different leadership styles are and are trying to incorporate them into their personal

leadership style.

Characteristics of managers are very personal but they are very important for understanding

how managers behave, how they treat and respond to others and how they help contribute to

organisational effectiveness through the four managerial functions; planning, leading,

organising and controlling.The third chapter covers the theory of emotional intelligence and

focus is put on the importance of the emotions of managers and to what degree companies

recruit and select managers on the basis of emotional intelligence characteristics versus

technical qualifications. This chapter is mostly based on the theory of David McClelland and

Daniel Goleman.

5

In modern management, many words have been written about the value of soft management

(focus on the personal aspects in working environment). It is therefore interesting to find out

3 McClelland (1973)4 Meyer, et al. (2007)5 McClelland (1973) and Goleman (1998)


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if this is something that is preached more than practiced, if managers today are really

following the theories that they claim to do and if this is really something that is being used as

a guideline when managers are recruited. Chapter four and five cover this matter with a

description of the research which was conducted in order to connect theory to practice and the

result of that research.


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1. Traditional Management

The world is changing more rapidly than ever before and managers and other employees

throughout an organisation need to perform at higher and higher levels. In the last twenty

years, competition between organisations, both nationally and internationally, has increased

dramatically. Managers need to learn and adapt to changes in the global environment in order

to achieve the goals of the organisations.6

Today, the termcompetencies is often used to refer to a specific set of skills, abilities and

experiences that gives a manager the ability to perform at a higher level. Developing such

competencies through education and training has become a major priority for managers and

the organisations they work for.

To understand better the role of managers it is necessary to define what management is.

Management is the organizational process that includes strategic planning, managing

resources, deploying the human and financial assets needed to achieve objectives, and

measuring results. Management also includes recording and storing facts and information for

later use or for others within the organization.

Management functions are not limited to managers and supervisors. Every member of theorganization has some management and reporting functions as part of their job.Jones, George

and Hill describe management as:

Management is the planning, organising, leading and controlling of resources to

achieve organisational goals effectively and efficiently.7

According to them there are a few key concepts; organisations, goals, resources and

managers. They explain organisations as collections of people who work together and

coordinate actions to be taken to achieve certain goals. Thesegoals, which are to be achieved,

are what are desired in the future. Resources are the companys assets such as people,

machines, information, skills and financial capital. The role of the managers is to supervise

6 Meyer et al (2007)7 Jones, George and Hill (2000)


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the use of the resources so the goals can be achieved.8 Figure one shows the four functions of

management:9

Planning is the process that managers use

to identify and select appropriate goals and

courses of action. There are three steps in

planning: 1) deciding what the goals of the

organisation are, 2) deciding what actions

need to be taken in order to achieve these

goals, and 3) deciding how to allocate

organisational resources to accomplish

them. Planning is a complex activity because normally the goals of an organisation are notimmediately clear. Managers take risks when they commit organisational resources to pursue

a particular strategy.

Organising is a process which managers use to establish a structure of working relationships

so that all members of the organisation interact and co-operate to achieve the goals.

Organising involves grouping people into departments according to the job-specific tasks they

perform. Managers lay out the lines of authority and responsibility between individuals and

groups and decide how organisational resources can be best utilised.

Leading is the process of articulating a clear vision for organisational members to follow. This

should enable the members to understand the role they play in achieving organisational goals.

An ideal outcome of good leadership is a high level of motivation and commitment of

organisational members.

Controlling is the ability to measure performance accurately and regulate organisational

efficiency and effectiveness. Managers evaluate how well an organisation is achieving its

goals and take action to maintain or improve performance. They monitor the performance of

individuals, departments and the organisation as a whole and if standards are not met they

need to take action in order to improve performance.10

8 Jones, George and Hill (2000)9 Meyer et al. (2007) p. 610 Ibid,. p. 6-9


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Management is an organizational function but does not necessarily mean managing people; it

can also be the management of other resources like capital sales areas and marketing.

Management is like an investment. Managers have resources to invest; their time, talent and,

possibly, human resources. The goal (function) of management is to get the best return on

such resources by getting things done efficiently. This doesn't imply being mechanical ornarrowly controlling as some writers on management suggest. The manager's style is a

personal or situational matter and has evolved over time. With highly skilled and self-

motivated knowledge workers, the manager must be very empowering. Where the workforce

is less skilled or not very motivated, the manager may need to monitor output more closely.

Skilled managers know how to vary their style, coach and motivate diverse employees.

Getting things done through people is what they do. By saying that management is a function,

not a type of person or role, it is easier to account for self-managed work teams where no one

is in charge. In a self-managed team, management is a group effort with no one being the

designated manager.11

Improvements in management have taken place because the relevant stakeholders have found

that the current management styles are insufficient in dealing with the problems of the

future.12 The next chapter tells how management theory has developed over time from first

focusing on how to increase the effectiveness of machines to the importance of the human

mind in the organisational process.

1.1 Theoretical Scope of Management

As an area of academic study, management is essentially a product of the twentieth century.

However, the actual practice of management has been around for thousands of years. Tangible

examples can be found throughout history, for example the pyramids of Egypt stand as

evidence of the ancient worlds ability to manage. Even though Egyptian management

techniques were coarse by modern standards, many problems they faced are still around

today. 13 They, like todays managers, had to make plans, obtain and mobilize human and

material resources, coordinate interdependent jobs, keep records, report their progress and

11 McCrimmon (2007)12 Meyer et al (2007)13 Kreitner (2001)


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take corrective action as needed.14 Since the buildings of the pyramids, entire civilizations

have come and gone and management has been practised in each of them. One modern

element has been missing though and that is a systematically record of management

knowledge. In early cultures management was something one learned by word of mouth and

trial and error. It was not something one studied in school or read about in textbooks.15

The evolution of modern management began at the end of the nineteenth century, after the

industrial revolution had swept through Europe and America. As the economy was changing,

managers in all kinds of organisations, both public and private, were constantly trying to find

better ways to satisfy the needs of customers. Major economic, technical and cultural changes

took place at this time.16 Utilization of steam powered machines was made more efficient and

the development of new machinery and equipment changed the way goods were produced.

This especially applied in the clothing industry as small workshops run by skilled workers,

who produced hand-manufactured products, were being replaced by large factories where

machines were controlled by thousands of unskilled workers who made the products.

Managers and owners of the new factories faced problems as they were often engineers who

had the technical skills to support the machinery but often lacked the craft-specific expertise.

There were also other problems, for example social problems that occurred when people

worked together in large groups. Managers had to search for new techniques to manage their

organisations and soon they began to focus on ways to increase the efficiency of the worker-

task mix.17

Figure 2 The Evolution of Management Theory18

14 Kreitner (2001)15 Ibid,.16 Meyer et al. (2007)17 Ibid,.18 Ibid,. p. 34


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To begin with, the management theorists were interested in the subject of why the new

machine/factory systems were more efficient and produced greater quantities of goods than

older production operations. In the mid-eighteenth century, Adam Smith was one of the first

writers to investigate the advantages associated with producing in factories. He provided a

theoretical background to resource-allocation, production and pricing issues. Smith found outthat increasing the level of job-specialisation increased efficiency and led to higher

organisational performance.19 This inspired many managers and researchers to investigate

further how job-specialisation could be improved in order to increase performance. The focus

was on how managers should organise and control the work processes to maximise the

advantage of job-specialisation and the division of labour.20 Since that time many theories

have developed throughout the decades and in the next chapter some of these theories will be

discussed.

1.2 Management Theories

To be able to study modern management it is necessary to provide a useful historical

perspective of management. It is safe to say that no single theory of management is

universally accepted today. There have been different approaches to management throughout

history and some of them are:

The universal approach

The operational approach

The behavioural approach

The systems approach

The contingency approach

The attributes of excellence approach.

Understanding these general approaches to the theory and practice of management is

necessary to see how management has evolved, where it is today and where it appears to be

headed.21

19 Smith (1982)20 Meyer et al. (2007)21 Kreitner (2001)


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1.2.1 The Universal Process Approach

The universal process approach is the oldest and the one of the most popular approaches to

management thoughts. According to this approach, the administration of all organizations

requires the same rational process. One core management process remains the same across all

organisations even though the purpose of the organisations varies. Therefore, successful

managers are equivalent among organisations of different purposes. The universal approach

can also be reduced to a set of separate functions and related principles.22

In 1916, Henry Fayol published his book Administration Industrielle et Gnrale. Fayol was

first an engineer and later a successful administrator in a large French mining company. He

was a manager who tried to translate his broad administrative experience into practical

guidelines for the successful management of all types of organisations. It was Fayols beliefthat a managers job could be divided into five managerial functions which all were essential

to being a successful manager; planning, organising, command, coordination and control.23

These five elements were Fayol's definition of management roles and actions:24

1. To plan. (Forecast & Plan). Examining the future and drawing up a plan of action. The elements of

strategy.

2. To organize. Build up the structure, both material and human, of the undertaking.

3. To command. Maintain the activity among the personnel.

4.

To coordinate. Binding together, unifying and harmonizing all activity and effort.5. To control. Seeing that everything occurs in conformity with established rule and expressed command.

His fourteen universal principles of management (see table 1) were intended to show

managers how to carry out their functional duties.25 Fayols elements and principles have

withstood the test of time because of their widespread applicability. These functions can still

be found in almost all management texts, as Carroll and Gillen put it:

The classical functions still represent the most useful way of conceptualising the

managers job, especially for management education, and perhaps this is why it is still

the most favoured description of managerial work in current management textbooks. The

22 Kreitner (2001)23 Ibid,.24 Marino (2008)25 Kreitner (2001)


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classical functions provide clear and discrete methods of classifying the thousands of

different activities that managers carry out and the techniques they use in terms of the

functions they performfor the achievement of organisational goals.26

Table 1. The 14 Management Principles from Henri Fayol (1841-1925)27:

1. Division of Work. Specialization allows the individual to build up experience, and to continuously improve his skills. Thereby hecan be more productive.

2. Authority. The right to issue commands, along with which must go the balanced responsibility for its function.

3. Discipline. Employees must obey, but this is two-sided: employees will only obey orders if management play their part byproviding good leadership.

4. Unity of Command. Each worker should have only one boss with no other conflicting lines of command.

5. Unity of Direction. People engaged in the same kind of activities must have the same objectives in a single plan. This is essentialto ensure unity and coordination in the enterprise. Unity of command does not exist without unity of direction but does notnecessarily flow from it.

6. Subordination of individual interest (to the general interest). Management must see that the goals of the firm are alwaysparamount.

7. Remuneration. Payment is an important motivator although by analyzing a number of possibilities, Fayol points out that there isno such thing as a perfect system.

8.

Centralization (or Decentralization). This is a matter of degree depending on the condition of the business and the quality of itspersonnel.

9. Scalar chain (Line of Authority). A hierarchy is necessary for unity of direction. But lateral communication is also fundamental,as long as superiors know that such communication is taking place. Scalar chain refers to the number of levels in the hierarchyfrom the ultimate authority to the lowest level in the organization. It should not be over-stretched and consist of too-many levels.

10. Order. Both material order and social order are necessary. The former minimizes lost time and useless handling of materials. Thelatter is achieved through organization and selection.

11. Equity. In running a business a combination of kindliness and justice is needed. Treating employees well is important toachieve equity.

12. Stability of Tenure of Personnel. Employees work better if job security and career progress are assured to them. An insecuretenure and a high rate of employee turnover will affect the organization adversely.

13. Initiative. Allowing all personnel to show their initiative in some way is a source of strength for the organization. Even though itmay well involve a sacrifice of personal vanity on the part of many managers.

14. Esprit de Corps. Management must foster the morale of its employees. Fayol further suggests that: real talent is needed tocoordinate effort, encourage keenness, use each persons abilities, and reward each ones merit without arousing possible

jealousies and disturbing harmonious relations.

Fayols main contribution to management thought was to show how the complex process of

management can be separated into interdependent areas of responsibility. His idea was that

management is a continuous process beginning with planning and ending with controlling and

this remains popular today.

The functional approach is useful because it describes what managers should do. However, it

does not help explain why and how something should be done. For that purpose, other

approaches are needed.

28

The basic concerns that motivated Fayol continue to motivatemanagers today. The principles that he set forward have provided a clear and appropriate set

of guidelines that managers can use to create a work-setting that makes effective and efficient

use of organisational resources. The principles are a foundation for modern management

26 Carroll and Gillen (1987) p. 4827 Marino (2008)28 Kreitner (2001)


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theory and other researchers have developed them so that they fit in today. An examples of

this is Fayols thoughts for equity and the links between performance and reward which today

are central themes in modern theories of motivation and leadership.29

1.2.2 The Operational Approach

The operational approach is a convenient description of the production-oriented area of

management dedicated to improving efficiency and cutting waste.30 This is a systematic study

of the relationships between people and tasks for the purpose of re-designing the work process

in order to increase efficiency. Throughout history this approach has been technically and

quantitatively oriented and it has been given many names, such as scientific management,

management science and operations management. The best known protagonist of the

operational approach is Frederick W. Taylor who is best known for defining a set of

principles which have become known as scientific management.31

Taylor was the epitome of the self-made man. In his early life he had problems with his eyes

which prevented him from going to Harvard University so instead he went to work as a

common labourer in a small machine shop. He later became a manufacturing manager and

eventually became a consultant and taught other managers how to use his techniques.

It was Taylors believe that the production process would become more efficient if the

amount of time and effort to produce a unit of output could be reduced by increasing job-

specialisation. Based on his findings, Taylor developed four principles to increase efficiency

in the workplace (the four principles are shown on next page).32

29 Meyer et al. (2007)30 Kreitner (2001)31 Meyer et al. (2007)32 Ibid,. p. 36-37


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Table 2. The Four Principles of Taylor

Principle 1: Study the way workers performtheir tasks, gather all the informal job knowledge that workers

possess, and experiment with ways of improving how tasks are performed.Taylor studied and measured in great

deal the way different workers went about performing their tasks to discover the best method of completing a

task. One of the main tools he used was a time-and-motion study, which involves the careful timing and

recording of the actions taken to perform particular tasks. Once Taylor understood the existing methods of

performing a task, he made experiments in order to increase specialisation.

Principle 2: Codify the new methods of performing tasks into written rules and standard operating procedures.

Once the best method of performing a task was determined, Taylor specified that is should be recorded so that

the procedure could be taught to all workers performing the same task. By standardising and simplifying jobs

further, the efficiency would be increased throughout an organisation.

Principle 3: Carefully select workers who possess skills and abilities that match the needs of the task, and train

themto performthe task according to the established rules and procedures.Taylor believed that workers had to

understand the tasks that were required of them in order to increase specialisation. It was his believe that they

needed to be trained to perform a task at an optimum level. Workers who could not be trained to this level were

to be transferred to a job where they were able to reach the minimum required level.

Principle 4: Establish a fair or acceptable level of performance for a task, and then develop a pay systemthat

provides a reward for performance above the acceptable level.To encourage workers to perform at a higher

level of efficiency, Taylor wanted workers to benefit from any gains in performance. He provided them with an

incentive to reveal the most efficient techniques for performing a task. They should receive bonuses and some

percentage of the performance gains achieved through the more efficient work process.

By 1910, the system of scientific management had become nationally known in the United

States and was fully practised. Among the many that followed in Taylors footsteps, Frank

and Lillian Gilbreth and Henry L. Gantt stand out. Frank and Lillian Gilbreth were really

inspired by Taylors time-and-motion studies. They turned motion studies into an exact

science. In doing so they pioneered the use of motion pictures for studying and streamliningwork motions. Henry L. Gantt contributed to scientific management by refining production

control and cost-control techniques. He also humanised Taylors differential piece-rate system

by combining a guaranteed day rate, or a minimum wage, with an above-standard bonus.

Gantt was ahead of his time in emphasising the importance of the human factor and in urging


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management to concentrate on service rather than profits.33 Here is where the researchers first

started to think of the importance of the human mind

1.2.3 The Behavioural Approach

The behavioural approach originates from American management theorists who began their

studies and research when Taylorist theories were at the height of their influence. Even

though the approach of these theorists differed, they all focused on behavioural management;

how managers should behave to motivate their employees and encourage them to perform at a

higher level so that the goals of organisations could be reached.34 The advocates of the

behavioural approach believed that people deserved to be the central focus of organised

activity. According to them, successful management depends on the managers ability to

understand and work with people who have a variety of backgrounds, needs and perception.

Mary Parker Follett was one of the theorists, in the beginning of the twentieth century, who

focused their work on the way managers should behave towards their employees. She

criticised Taylors approach because it didnt take into account the difference between

individuals and ignored the human side of the organisation. It was her opinion that

management often overlooked the multitude of ways in which employees could contribute to

the organisations if their managers would allow them to participate and use their initiatives in

their every day work lives.35 What made the procedures of Follett and Taylor different was

that Taylor used time-and-motion experts to analyse the jobs of the workers while Follett

thought that the workers should be involved in the job analysis process. It was her opinion

that the workers were the most qualified to analyse their own jobs and therefore they should

participate in the process. The managers should behave as coaches or guides rather than

supervisors. Follett anticipated the emergence of self-managed teams and employee

empowerment which is so popular today. She also saw the importance of different

departments working together or, as it is called today, cross-functioning.36

33 Kreitner (2001)34 Meyer et al. (2007)35 Graham (1995)36 Follett (1924)


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While acknowledging Fayols opinion of acknowledged expertise as an important source of a

managers authority, Follett went even further. Fayol argued that leaders emerged from

managers authority derived from their position in the hierarchy but Follett proposed that

knowledge and expertise should decide who would be the leader at any particular moment. It

was her belief that power is fluid and should flow to the person who could do the most for theorganisation and help it achieve set goals. She looked at the organisation horizontally instead

of Fayols hierarchical, bureaucratic view and believed that effective management came from

the way people interacted and reinforced each other. This approach was very radical at that

time but is well recognised today.37

As the socio-political climate changed, behavioural scientists from prestigious universities

began to conduct on-the-job behaviour studies. Instead of studying tools and techniques in the

scientific management tradition, they focused on people.

38

One of these studies wasconducted from 1924 to 1932 at the Hawthorne Works of the Western Electric Company.

The Hawthorne studies were a small-scale scientific management study of the relationship

between light intensity and productivity. The performance of a selected group of employees

tended to improve no matter how the physical surroundings were manipulated. Even when the

lights were dimmed to moonlight intensity, productivity continued to grow. As scientists

could not figure out why this happened, a team of behavioural science researchers from

Harvard, headed by Elton Mayo, was asked to conduct a more thorough study. The

Hawthorne studies ended in 1932 and by then over twenty thousand employees had

participated in it. After extensive interviewing with the employees, it became clear that

productivity was much less affected by changes in the work environment than by the attitudes

of the workers themselves. The relationship between the worker and his supervisor and

between members of a group was found to be more significant. This finding influenced many

researchers to turn their attention to managerial behaviour and leadership. If managers could

be taught how to behave and how to motivate their employees then productivity could be

increased.

39

From this view emerged the human relations movement, which advocated thatmanagers should be behaviourally trained to manage their employees in order to increase their

co-operation and as a consequence productivity would also increase.

37 Meyer et al. (2007)38 Mayo (1933)39 Kreitner (2001)


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One of the main assumptions of the Hawthorne studies was that the behaviour of managers

and workers in the work place is as important in explaining the level of performance as the

technical aspects of the task. It is very important for managers to understand how the informal

organisations works, i.e. the system of behavioural rules and norms that emerges in a group

when they try to change behaviour in an organisation. The Hawthorne studies demonstratedthe importance of understanding how feelings, thoughts and behaviour of group members and

managers affected performance. With these studies it was becoming clear to researchers that

understanding behaviour in organisations was critical so that performance could be

increased.40

The increasing interest in the management style known as organisational behaviour dates back

to these early studies. Organisational behaviour is a modern approach to management that

attempts to determine the causes of human work behaviour and translate the results intoeffective management techniques. It has had a significant impact on modern management

thoughts by helping to explain why employees behave as they do. Above all else, the

behavioural approach has made it clear that people are the key to productivity. Technology,

work rules and standards do not guarantee good job performance; instead success depends on

motivated and skilled individuals who are committed to organisational goals.41

1.2.4 The Systems Approach

An important milestone in the history of management development occurred when researchers

went beyond the study of how managers could influence behaviour within organisations to

consider how managers control the organisations relationship with its external environment.

Universal process, scientific management and human relations theorists studied management

by taking things apart. They assumed that a whole was equal to the sum of its parts and could

be explained in terms of its parts. Systems theorists thought differently, they studied

management by putting things together and assumed that the whole was greater than the sumof its parts. System thinking presented the field of management with a huge challenge which

was to identify all relevant parts of organised activity and to discover how they interacted.

According to Chester I. Barnard, willingness to serve, common purpose and communication

40 Carey (1967)41 Kreitner (2001)


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are the principal elements in an organisation.42 His opinion was that organisations could not

function if these three elements did not exist interdependently. Barnards systems perspective

has encouraged management and theorists to study organisations as complex and dynamic

wholes instead of piece by piece. 43

One of the most influential views on how an organisation is affected by its external

environment was developed by three theorists, Katz, Kahn and Thompson in the 1960s. They

viewed the organisation as an open system; a system that takes resources from its external

environment and transforms them into products and services which are then sent back to the

environment and bought and consumed be customers.44 The system is said to be open because

the organisation draws from and interacts with the external environment to survive, i.e. the

organisation is open to its environment. A closed system, on the other hand, is a self-

contained system that is not affected by changes in the external environment.

45

Due to thesystems approach, managers now understand the importance of seeing the whole picture.

Open-systems thinking does not permit the manager to become preoccupied with one aspect

of the organisation while ignoring other internal and external angles. Another positive point is

that the approach tries to integrate various management theories, for example both operations

management and organisational behaviour have been strongly influenced by systems

thinking.46

1.2.5 The Contingency Approach

The contingency theory was developed in the 1960s by several researchers both in United

Kingdom and the United States. This approach is an effort to determine, through research,

which managerial practises and techniques are appropriate in specific situations. The crucial

message of this theory is that there is no one best way to organise; managers choose the

organisational structure and the control systems which depend on characteristics of the

external environment in which the organisation operates.47 Contingency has become

synonymous with situational management. According to Shetty, a contingency theorist, the

42 Barnard (1938)43 Kreitner (2001)44 Katz and Kahn (1966) Thompson (1967)45 Meyer et al.(2007)46 Kreitner (2001)47 Meyer et al. (2007)


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effectiveness of a given managerial pattern is contingent on numerous factors and how they

interact in certain situations.48 The appropriate use of a management concept or theory is thus

contingent or dependent on a set of variables that allows the user to fit the theory to the

situation and particular problems. It also allows for management theory to be applied to an

intercultural context where customs and culture must be taken into consideration.49

An important characteristic of the external environment which affects an organisations ability

to obtain resources is the degree to which the environment is changing. These changes can be

for example technological, entry of new competitors or unstable economic conditions. The

more rapidly the environment changes the more important it is for managers to find new ways

to respond to these changes. The contingency theory was an extension of the systems

approach but it added more practical directions.

1.2.6 The Attributes of Excellence Approach

In 1982, Peters and Waterman wrote a book that took the management world by storm. In

their book, In Search of Excellence they attempted to explain what made the best-run

companies in America successful. Their approach to management was unconventional for

several reasons. They criticised conventional management theory for being too conservative,

analytical, inflexible and negative. They replaced conventional management terms with catch

phrases and they made their key points with stories and anecdotes rather than with quantified

data and facts. Their aim was to take a fresh look at management.50 Peters and Waterman

conducted a research where they isolated eight attributes of excellence after studying many of

the best-managed and most successful companies in America. The eight attributes where are

shown on the next page.51

48 Shetty (1974)49 Kreitner (2001)50 Ibid,.51 Peters and Waterman (1982)


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Table 3. The Eight Attributes of Excellence

1. A bias for action: Small scale, easily managed experiments to build knowledge, interest andcommitment.

2. Close to the customer: Learning from the people served by the business.

3. Autonomy and entrepreneurship: Fostering innovation and nurturing 'champions'.

4.

Productivity through people: Individuals are treated with respect and dignity.5. Hands-on, value-driven: Management philosophy that guides everyday practice - management showingits commitment.

6. Stick to the knitting:Stay with the business that you know.

7. Simple form, lean staff: Authority is decentralised as much as possible.

8. Simultaneous loose-tight properties: Tight overall strategic and financial control is counterbalanced by

decentralised authority, autonomy and opportunities for creativity.

Peters and Waterman pointed out and reminded managers that they should pay closer

attention to the basics such as customers, employees and new ideas.

It is important to understand the evolution of management because management problems

remain mostly the same over time. While value systems and perspectives may have changed,

experts have gained a better understanding of what motivates employees. Peter Drucker, a

writer and management consultant, was under the impression that management had to do with

empowerment; he saw employees as resources rather than simply costs. He argued that

management had to move from the influence of Taylorism, where people are treated as cogs

in a machine, and start to treat them as if the employees had brain. Knowledge and education

was the single most important resource for any advanced society.52 During the twentiethcentury managers received more respect and proved their importance. Practitioners of the

science of management also received a certain amount of prestige and that opened the way for

popularised systems of management ideas. At the end of the twentieth century, management

consisted of six separate branches; human resource management, operation management,

strategic management, marketing management, financial management and information

technology management. The role of the manager and his influence on employees was

becoming more and more important as Mary Parker Follett pointed out. Henry Fayol argued

that leaders emerged from managers authority derived from their position in the hierarchy

but Follett proposed that knowledge and expertise should decide who would be the leader at

any particular moment. In the next chapter the role of a leader will be discussed.

52 Drucker (1990)


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2. Leadership

There are almost as many definitions of what leadership is as there are commentators. Many

associate leadership with one person leading but four things stand out in this respect. First of

all, to lead involves influencing others; secondly where there are leaders there are followers.

Third, leaders seem to step forward when there is a crisis or special problem and fourthly,

leaders are people who have a clear idea of what they want to achieve and why. It can be said

that leaders are people who are able to think and act creatively in non-routine situations and

who set out to influence the actions, beliefs and feelings of others. In this sense, being a leader

is personal; it flows from an individuals qualities and actions. However, it is also often linked

to some other role such as manager or expert but it is important to remember thatnot all

managers are leaders and not all leaders are managers.53 One of the four primary tasks of

managers is leading and leadership is a key ingredient in effective management. Effective

leaders make people highly motivated and committed but when they are ineffective it is likely

that their subordinates do not perform up to their capabilities and become dissatisfied.54 The

concept of leadership is about getting people to do things willingly and influencing others to

follow you. It can also be seen as a behavioural category. Leadership can be defined as:

A process in which leader and follower interact in a way that enables the leader to

influence the actions of the follower in a non-coercive way, towards the achievements ofcertain aims or objectives.55

Definitions of leadership often suppose that leadership is a one-way process but other factors

should be considered. Being non-coercive means that it is possible to influence all members.

The nature of leadership should always be goal-directed so that the subordinates know what

they should achieve and they also have to approve of being influenced by the leader.56 The

personal leadership style of a manager, i.e. how he chooses to influence the employees,

shapes the way the manager approaches planning, organising and controlling. All managers

have their own leadership style that determine how they lead their employees and perform

their management tasks. Even though leading is one of the four principal tasks of managing, a

distinction is often made between managers and leaders. Managers are more likely to have

53 Doyle and Smith (2001)54 Meyer et al. (2007)55 Ibid,. p. 46056 Ibid,.


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formal authority to direct their employees; this may be seen as a top-down approach. On the

other hand leaders have to earn their authority through influence and that is more a bottom-

up approach.57

There are many different leadership styles in traditional leadership and many ways of defining

a good leader. There are also different leadership styles across cultures, which suggests that

leadership styles do not only differ from person to person but also between countries and

cultures. Leaders in Europe are said to be more humanistic or people oriented than leaders in

America and Japan. American leaders are also thought to be short-term and focused on profits

while in Japan they are thinking of profits in a long term perspective.58

It is stated in classical leadership that the key to effective leadership is found in the power the

leader has to affect other peoples behaviour or getting them to act in a fixed manner.

59

Thereare several types of power a leader must have: legitimate, coercive, expert, reward and

referent power (see figure 3).60 Effective leaders should make sure that they have sufficient

levels of each type and that they use the power they have in a beneficial way.

Figure 3 Sources of Managerial Power

Legitimate power is the authority that a manager has by virtue of his position in the

organisation and gives him the power to hire new employees, assign projects, monitor

their work and appraise their performance.

57 Meyer et al. (2007)58 Calori and Dufour (1995)59 Mintzberg (1983).60 French and Raven (1960)


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Reward power is the ability to withhold or give tangible (e.g. pay-rises and bonuses)

and intangible (e.g. verbal praise and respect) rewards. Being able to give or withhold

rewards based on performance is a major source of power that allows managers to

have a highly motivated workforce. Effective managers use their reward power to let

their employees know that their work is appreciated. Ineffective managers on the otherhand, use reward power in a more controlling manner.

Coercive power is the ability to punish others. Punishments can range from verbal

reminders to reduction in pay or actual dismissal. Excessive use of coercive power

seldom results in high performance and is questionable ethically, but may at times be

useful.

Expert power is based in some special skills or knowledge that the leader has. First-

level and middle managers often have technical expertise relevant to the tasks of their

employees. Their expert power gives them considerable influence. Effective leaders

take steps to make sure that they have an adequate amount of expert power to perform

their leadership roles. They can do that by obtaining additional training or education

and make sure that they are well informed about latest developments and changes in

technology. Expert power tends to be best used in a guiding or coaching manner rather

than in an arrogant way.

Referent power is more informal than the other kinds of power; it is more a function

of the personal characteristics of a leader. It is a power that comes from subordinates

and co-workers respect, admiration and loyalty. Here it is vital that the leader has the

charisma needed to motivate his employees. Leaders who are likable and whom

employees consider a role model are especially likely to possess referent power.61

More and more managers today are becoming aware of how important different leadership

styles are and are trying to incorporate them into their personal leadership style.

Empowerment, which is the process of giving employees at all levels in the organisation the

authority to make decisions and making them more responsible for their tasks, is very popular

today. This might seem to be the opposite of effective leadership because managers are

allowing their employees to take more active role in leading but actually, empowerment can

contribute to effective leadership for several reasons. Empowerment increases a managers

ability to get things done because he has the help of the employees who might have special

61 Meyer et al. (2007)


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knowledge needed to complete the tasks. Empowerment also increases motivation and

commitment of the employees and they are working toward organisational goals. It also gives

managers more time to concentrate on the tasks they need to complete because they dont

have to spend all their time on day-to-day supervisory activities.62

2.1 Models of Leadership

Leading has become very important process in all kinds of organisations. Early approaches to

leadership were to determine what effective leaders were like as people and what they did that

made them so effective. In recent literature of leadership the focus has been on four main

theories of leadership; trait theory, behavioural theory, contingency theory and

transformational theory. The next sub-chapters go into more details about each theory.

2.1.1 The Trait Theory

The Trait model of leadership focused on identifying the personal characteristics that cause

effective leadership. It was assumed that effective leaders must have certain personal

qualities, or traits, which made them different from ineffective leaders and from people who

never became leaders. This research started in the 1930s where hundreds of studies were

conducted. The results indicated that there were in fact some personal characteristics which

seemed to be associated with effective leadership. Some of those characteristics were related

to intelligence, knowledge, integrity and self-confidence of the leaders. However, these

characteristics are insufficient in explaining a do not alone explain leaders effectiveness as

some effective leaders do not possess all of them and some leaders who do possess them are

not effective.63 Since there seemed to be a lack of consistency between the characteristics of

leaders and their effectiveness researchers needed a new focus. Rather than focusing on what

leaders are like, they began to look at what effective leaders actually do, i.e. their behaviour.

62 Meyer et al. (2007)63 Ibid,.


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2.1.2 The Behaviour Theory

The Behaviour model describes two kinds of behaviour that most leaders are supposedly

engaging in; consideration and initiating structure. Leaders engage in consideration when they

show their subordinates that they trust, respect and care about them. When leaders engage in

initiating structure they make sure that the work gets done and that the workers perform their

work acceptably and that the organisation is efficient and effective. Examples of initiating

structure are assigning tasks to workers, letting employees know what is expected of them,

deciding how the work should be done and motivating people to perform well.64 The

relationship between performance of consideration and initiating structure behaviour and

leaders effectiveness is not clear. Some leaders are ineffective when they perform both and

some are effective even though they do not perform consideration or initiating structure. Like

the Trait model, this behaviour model does not alone explain why some leaders are effective.

What was researched next and added to the picture were the situations in which leadership

occurs.

2.1.3 The Contingency Theory

Managers lead in a wide variety of situations and have various kinds of employees performing

diverse tasks in many kinds of environmental context. The Contingency models of leadership

take into account the situation which leadership occurs in. According to these model, what

makes a manager effective is combined with what the manager is like as a person, what he

does and the situation in which the leadership takes place.65 The Contingency models cover

few different styles. One of them is the contingency model of Fred E. Fiedler which helps

explain why a manager may be an effective leader in one situation and ineffective in another.

According to Fiedler, all managers can be described as having either of two leadership styles;

relationship-oriented (managers want to develop a good relationship with employees and be

liked by them) or task-oriented (managers focus on task accomplishment and making sure that

each job gets done).66 Another contingency theory is Houses path-goal theory which

describes how leaders can motivate their subordinates by four different kinds of behaviour:

directive, supportive, participative and achievement - oriented.67 A directive leader sets goals,

assigns tasks and shows the employees how to complete tasks. A leader which is supportive

64 Meyer et al. (2007)65 Ibid,.66 Fiedler (1967)67 Evans (1970)


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expresses his concern for subordinates and looks out for their interests. Those who show

participative behaviours give workers the opportunity to say what they think and be involved

in decision making. Achievement-oriented behaviours motivate employees to perform at the

highest level possible by e.g. setting goals, expecting that they will be met and believing in

the capabilities of the workers.

2.1.4 The Transformational Theory

Transformational leadership is a leadership style where people follow the leader because they

are inspired by him, a leader with a vision and passion that can achieve great things.68

Transformational leadership starts with the development of a vision, a view of the future that

will excite and convert potential followers. This vision may be developed by the leader, by the

senior management team or may emerge from a broad series of discussions. The next step,which in fact never stops, is to constantly sell the vision. The transformational leader thus

takes every opportunity and will use whatever method that works to convince others to climb

on board.69 In order to create followers, the transformational leader has to be very careful in

creating trust, and their personal integrity is a critical part. In effect, they are selling

themselves as well as the vision. The route forward may not be obvious, but with a clear

vision, the direction will always be known. Transformational leaders are always visible and

will stand up to be counted rather than hide behind their troops and they show by their

attitudes and actions how everyone else should behave. They also make a continuous effort to

motivate their followers, constantly listening, soothing and keeping up the enthusiasm. They

are people-oriented and believe that success comes first and last through deep and sustained

commitment. Transformational leaders are often charismatic, but are not as narcissistic as

pure charismatic leaders, who succeed by believing in themselves rather than believing in

others. One of the traps of transformational leadership is that passion and confidence can

easily be mistaken for truth and reality, they tend to see the big picture, but not the details,

which can be a problem if they dont have people to take care of this level of information.

Working for a transformational leader can be great and very inspiring, they put passion and

energy into everything they care about and want you to succeed70.

68 Changing Minds (Year unknown)69 Ibid,.70 Ibid,.


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According to Bass, transformational leadership occurs when managers change their

subordinates in three ways:71

Transformational managers make their employees aware of how important their jobs

are for the organisation and that it is very important that those jobs will be done in abest way possible so that the organisational goals can be achieved.

Transformational managers make sure that every need of their employees is met and

that they are aware of what their needs are themselves. Those needs can be personal

growth, development and accomplishment.

Transformational managers motivate their employees to think of the organisations as a

whole, not just for their own personal gain or benefit.

When managers affect employees in these three ways, it is more likely that the employees

trust the manager and are highly motivated and that helps the organisations in achieving its

goals.72

Now both management and leadership have been defined, but what is it that differs between

them? The next chapter will focus on this difference.

2.2. Management vs. Leadership

An important question is how management differs from leadership. For some, there is no

difference. Due to increasing complexity there is even more need for specialization so it is

really necessary to recognize that leadership and management are two different functions.73

According to Mitch McCrimmon ...a clear way of differentiating the two is to say that

leadership promotes new directions while management executes existing directions as

efficiently as possible.74The managers job is not just to make sure that tasks are completed

on a daily bases, it involves more complex projects. Often, management is mistakenly seen as

task-oriented, controlling and insensitive to people's needs. By contrast, leaders are portrayed

as emotionally engaging, visionary and inspiring. Separating leadership from management is

71 Bass (1985)72 Meyer et al. (200773 McCrimmon (2007)74 Ibid,.


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difficult as leading is one of the four functions of management.75 The best managers are very

strategic about themselves because they know that time and other resources are scarce and

that they have to work efficiently and effectively if the organisational goals are to be met.

Working efficiently is however not enough, it is essential to do the right things. Management

is primarily a decision-making role and managers are responsible for making a profit. Thisrequires them to make wise decisions.76 By contrast, leadership is strictly an informal

influence and what leaders do is to convince people of changing directions. The main

difference between managers and leaders is that leadership is an occasional act;

management is an ongoing role.77Table four shows the main difference between managers

and leaders:78

Table 4. The Difference between Leaders and Managers

Subject Leader Manager

Essence Change Stability

Focus Leading people Managing work

Have Followers Subordinates

Horizon Long-term Short-term

Seeks Vision Objectives

Approach Sets direction Plans detail

Decision Facilitates Makes

Power Personal charisma Formal authority

Appeal to Heart Head

Energy Passion Control

Dynamic Proactive Reactive

Persuasion Sell Tell

Style Transformational Transactional

Concern What is right Being right

Like people everywhere, managers have their own personalities, values, ways of viewingthings and personal challenges and disappointments. In the next chapter the focus is on the

manager as a person with feelings.

75 Meyer et al. (2007)76 McCrimmon (2007)77 Ibid,.78 Changing Minds (Year unknown)


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2.3. The Human Side of Managers

All people have certain characteristics that influence how they think, feel and behave. These

characteristics are personality traits which according to Meyer et al. are ...particular

tendencies to feel, think and act in certain ways that can be used to describe personality of

every individual.79 It is important to understand the personalities of managers because they

influence their behaviour and what approach they use to manage people and resources. Some

managers are demanding and difficult to get along with but others easy to get along with and

are likeable yet may be demanding as well. Both styles may turn out to be successful but the

way it affects employees is quite different. Research has been conducted and the results

indicate that the way people react to different conditions depends partly on personalities.80

There are several psychological theories that try to explain whether personalities are innate or

develop from socialisation. In these theories there is a distinction between the traits that

people hold (a predisposition towards an enduring behaviour that occurs over time) and the

type of personality they fit into (fits people into categories e.g. extrovert or neurotic). One of

the most influential type theories come from Carl Jung and was developed during the 1950s.81

The Myers-Briggs Type Indicator (MBTI) was developed from this approach. According to

Jungs theory both types and traits are inborn to a degree but traits can be improved in a

similar way to skills. Types on the other hand evolve naturally over a lifetime.82 The MBTI

categories are four and are based on peoples preferences; extroversion/introversion,

sensing/intuition, thinking/feeling, judging/perceiving. People are given one of sixteen four

letter acronyms such as ESTJ or INFP. This indicates what their preferences are. For example

a person whose category is ENFP is open when dealing with other people as the categories are

extroversion, intuition, feeling and perceiving.83 The MBTI is used in many organisations and

for all kinds of reasons, e.g. the training of employees, personal development and recruitment.

In connection to this it is possible to think of an individuals personality as being made of five

general traits (characteristics); extroversion, negative affectivity, agreeableness,

conscientiousness and openness to experience.84 Each of these traits can be viewed as a

continuum along which every individual falls. Managers may be at the high end, low end or in

the middle of the continuum.

79 Meyer et al. (2007) p. 6880 Carpenter (2001)81 Jung82 Myers et al (1998)83 Meyer et al. (2007)84 Digman (1990)


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Extroversion is the tendency to

experience positive emotions and feel good

about oneself and others. People who score

high on extroversion tend to be affectionate

and outgoing. Managers who have a jobwhich requires a lot of social interactions

benefit if they are high on extroversion.

Negative affectivity is the tendency

to experience negative emotions and be

critical of oneself and other people. People

who score high on this trait are often angry

and dissatisfied.

Agreeableness is the tendency to get along well with others. People who score high

on this trait are likely to be affectionate and care about other people. If a manager has

the responsibility of developing close relationships with others than he could benefit

from scoring high on this trait.

Conscientiousness is the tendency to be careful and preserving. People who score

high on this trait are organised and self-disciplined.

Openness to experience is the tendency to be original, have broad interests, be open

to a range of stimuli and take risks. People who score high on this trait may be very

likely to take risks and be innovative in their planning and decision making.85

Members of an organisation should understand these differences among managers because

they can explain why managers behave in certain ways. Managers should also be aware of

their own personality traits and of others.

In addition to this there are other traits which also describe peoples personalities. Some of

them are: locus of control, self-esteem and the need for achievement, affiliation and power.86

Locus of control is about how people differ in their view of how much control they have overwhat happens to and around them. This can be put into to two categories, internal locus of

control (those who belief that they are responsible for their own fate) and external locus of

control (those who belief that outside factors are responsible for what happens to them). Self-

85 Meyer et at. (2007) p. 7286 Ibid,.


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esteem is the degree to which individuals feel about themselves and their capabilities. The

need for achievement is how strongly an individual desires to perform challenging tasks well

and to meet personal standards for excellence. The need for affiliation is about how concerned

a person is about establishing and maintaining good interpersonal relations. The need for

power is how much a person desires to control or influence others.87

These threecharacteristics suggest that managers need to be assertive and not only believe that their own

actions determine their own and their organisations fates but also believe in their own

capabilities.

Other things can be explored in order to try to explain how managers actually feel at work and

what they think about their jobs. Values, attitudes, moods and emotions capture how

managers and other employees experience their jobs as individuals. Values tend to be deeply

rooted in a persons socialisation and learning but attitudes emerge through personaldevelopment and social interaction. Values describe what managers are trying to achieve

through work and how they think they should behave, attitudes capture their thoughts and

feelings about their job, moods and emotions encompass how managers actually feel in their

job. These characteristics of a manager are very personal but they are very important for

understanding how managers behave, how they treat and respond to others and how they help

contribute to organisational effectiveness through the four managerial functions; planning,

leading, organising and controlling.88 As the topic of this paper is emotional intelligence, a

focus will be put on the importance of mood and emotions of managers and to what degreecompanies recruit and select managers on the basis of emotional intelligence characteristics

versus technical qualifications.

87 Meyer et al. (2007) p. 74-588 Ibid,.


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3. Emotional Intelligence

In order to understand the effects of managers and all employees moods and emotions, it is

important to take into account their level of emotional intelligence. The concept of emotional

intelligence has its roots from the work of two American psychologists, John Mayer and Peter

Salovey. They defined emotional intelligence as a subset of social intelligence. Social

intelligence is the ability to understand and manage people, but might also be directed inwards

and therefore could be the ability to understand and manage oneself.89 According to them

emotional intelligence is the ability to know, understand and have influence over ones own

emotions, ...the ability to monitor ones own and others feelings and emotions, to

discriminate among them and to use this information to guide ones thinking and actions. 90

It does not include the general sense of self and appraisal of others, rather it is more about the

recognition and use of ones own and others emotional states to solve problems and regulate

behaviour.

When people approach tasks in life with emotional intelligence they should be at an

advantage to solving problems. The kind of problems that people identify and the way they

handle them will probably be more related to internal emotional experience. Such individuals

are more likely to choose a career that will make them happy instead of thinking how much

they will earn and they are also more likely to be more creative and flexible in arriving at

possible alternatives to problems. Individuals who have developed skills related to emotional

intelligence understand and express their own emotions, recognise the emotions of others and

they also use moods and emotions to motivate adaptive behaviour.91

A person with emotional intelligence can be thought of as having attained at least some form

of positive mental health. These individuals are aware of their own feelings and those of

others, are open to positive and negative aspects of internal experience and are able to

communicate them when appropriate. This leads to the fact that an emotionally intelligent

person is often a pleasure to be around, has good influence and makes others feel better. This

person however does not mindlessly seek pleasure, but rather attends to emotions which lead

to growth. Salovey and Mayer say that:

89 Salovey and Mayer (1990)90 Ibid,. p. 18991 Ibid,.


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...emotional intelligence involves self-regulation appreciative of the fact that temporarily

hurt feelings or emotional restraint is often necessary in the service to greater

objective....thus emotionally intelligent individuals accurately perceive their emotions and

use integrated, sophisticated approaches to regulate them as they proceed toward

important goals. 92

Mayer and Salovey published their theory in 1990 but at that time it did not receive much

attention from the public or scholars. This however did catch the attention of a psychologist

named Daniel Goleman. He took the concept further and published two books about the

concept which became very popular.

Goleman defines emotional intelligence as the ability to understand and manage ones own

moods and emotions, and the moods and emotions of other people:

...abilities such as being able to motivate oneself and persist in the face of frustrations;

to control impulse and delay gratification; to regulate ones moods and keep distress

fromswamping the ability to think; to empathize and hope.93

People are being judged by new yardsticks and it is not how smart they are or what kind of

education they have or expertise, more focus is on how people handle themselves and others.

This yardstick is becoming more important and is increasingly applied when choosing whom

to hire. This new measurement focuses on personal qualities but takes for granted peoples

intellectual abilities and technical skills.94 Emotional intelligence is even more crucial today,

according to Goleman, because organisations are shrinking and the people who remain are

more accountable and visible, as Goleman puts it:

Where earlier a midlevel employee might easily hide a hot temper or shyness, now

competencies such as managing ones emotions, handling encounters well, teamwork,

and leadership show, and count, more than ever.95

The corporate world is changing and no one is guaranteed a job anymore. For many older

workers who were taught that education and technical skills were a permanent ticket to

success this new landscape is quite shocking. People are beginning to realise that to be

successful another type of skills are necessary to survive as Goleman puts it: Internal

qualities such as resilience, initiative, optimism and adaptability are taking on a new

92 Salovey and Mayer (1990) p. 20193Goleman (1995) p. 3694 Goleman (1999)95 Ibid,. p. 9


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valuation.96 All too often, in the context of reviewing competences of leaders or managers

for development purposes, they are told that they need to improve their people skills. That

means that the

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