Chapter 13 presents us with a wide array of leadership perspectives and theories. In order to synthesize the information, it is best to look at a real-life situation and compare and contrast two companies and their leadership styles. Case 14 on page W-123 in the OB Skills workbook at the back of our text is on Novo Nordisk and Southwest Airlines. Please read the case and we’ll begin the discussion with the first review question.
What leadership style dominates at Southwest? What about Novo Nordisk? What could each of these companies learn from the other? Cite examples from the case and specific information from the text to support your opinion.
The leadership style that dominates at Southwest is the House’s path-goal-view of leadership. The term “path-goal” is used because of its emphasis on how a leader influences subordinates’ perceptions of both work goals and personal goals, and the links, or paths, found between these two sets of goals.
The leader’s key function is to adjust his behavior to complement situational contingencies, such as those found in the work setting. Herb Kelleher, cofounder and former CEO of Southwest airlines applies a philosophy in an organizational culture that respects employees and their ideas particularly during troubling economic times. Subordinates are likely to be satisfied with the leader. The company has created employee satisfaction by focusing on its internal “Customers,” who are then positively motivated to show the same degree of concern for external customers. Southwest recently earned the top spot in Fortune magazine’s Most Admired airline list and is the only airline to make the magazine’s top 20 list in its annual survey assessing corporate reputations.
Novo Nordisk leadership style is a “delegating” style (S4) which is best for high readiness (R4). This is from the Hersey and Blanchard Situational Leadership Model. This style provides little in terms of direction and support for the task at hand; it allows able and willing followers to take responsibility for what needs to be done.
Novo Nordisk has framed a strategy for inclusive access to diabetes care. The ambition to ultimately defeat diabetes is at the core of Novo Nordisk’s vision. Much like Southwest, this vision puts the company’s objectives in perspective and inspires employees in their work. The leadership style that adheres to the company’s philosophy serves as a guiding light that keeps everyone’s focus on creating long-term shareholder value and leveraging the company’s unique qualities to gain competitive advantage.
In making decisions and managing their business, Novo Nordisk uses their Triple Bottom Line business principle to balance three considerations: Is it economically viable? Is it socially responsible? And is it environmentally sound? This ensures that decision-making balances financial growth with corporate responsibility, short-term gains with long-term profitability, and shareholder return with other stakeholder interests. The Triple Bottom Line is built into their corporate governance structures, management tools, individual performance assessments and rewards.
Schermerhorn, J. R., Jr., Hunt, J. G., Osborn, R. N., & Bien, M. U. (2010). Organizational Behavior. Hoboken, NJ: John Wiley & Sons, Inc.
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