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MGMT331 | LESSON 6

Leader as a Liaison

• LESSON TOPICS

• Strategic Partnerships
• Organizational Structure and Design
• Power and Influence
• The Boundaryless Organization and Servant Leadership

INTRODUCTION

Leaders do not independently create success. Leaders accomplish goals through and by collaborating with others. Throughout this lesson, you will explore the leader’s role as a liaison, fostering relationships and creative strategic partnerships with others. The benefits of strategic alliances are beneficial to both parties as they accomplish goals they could not accomplish on their own. You will also evaluate the components of an organization’s structure and consider the leader’s role in the design. Additionally, you’ll consider the types of power leaders may have along with strategies for influencing others. Finally, you will have the opportunity to consider servant leadership and the possibilities of the boundaryless organization.

Strategic Partnerships

It is obvious that leaders take on a great many roles as they work to achieve organizational goals. You’ve already learned about many of those roles, such as communicator, problem-solver, and visionary. In this lesson, you’re going to reflect on the leader’s role as a liaison. Due to the direct authority that leaders have in their roles as managers, Henry Mintzberg (1989) asserted that one of the important roles was that of liaison. The liaison role fell into Mintzberg’s category of interpersonal roles, which involved fostering relationships with others outside of the leader’s direct chain of command. For example, liaisons network and collaborate with individuals outside of their immediate manager and subordinates.

According to Mintzberg, managers spend about 45 percent of their time with people outside their units, 45 percent of their time with their subordinates, and 10 percent with their own superiors (Mintzberg, 1989, p. 17). Clearly, leaders need to spend a substantial amount of time creating and sustaining contacts with people outside their immediate work circle. Creating an extended network aids leaders in achievements because they have an extended network of support and expertise. Excellent leaders recognize that they, themselves, do not know everything. Therefore, it is crucial that they surround themselves with others who are smarter and who know more than they do. The best liaisons understand the importance of this crucial network of information because it can assist them in making critical decisions and achieving great things.

PARTNERSHIPS

With today’s increasingly global span of organizations, many leaders find themselves engaging in strategic partnerships with other organizations to accomplish goals. A strategic partnership, or alliance, is a relationship created through two entities combining competencies or resources to achieve success. The entities working to achieve a common goal may be organizations, businesses, or individuals. Agreements made between the entities may or may not be legally binding contracts. For example, some leaders may form strategic partnerships with other individuals for their expertise or insight into industry challenges. It is important that the strategic partnerships are beneficial for both entities in the relationship.

Types of Partnerships

A few types of strategic partnership agreements that leaders should consider are strategic marketing partnerships, strategic supply chain partnerships, strategic integration partnerships, strategic technology partnerships, and strategic financial partnerships (Spear, 2014).

STRATEGIC MARKETING PARTNERSHIPS

Marketing is an excellent way to reach customers and many businesses lack competencies in this area, such as web design, logo design, and advertising. Leaders can create relationships with marketing firms who have competencies in these areas. Additionally, partnerships between companies to pool resources and advertise together may be a great idea as well. One example of a marketing partnership would be the co-branding campaign that Red Bull and GoPro use to reach consumers.

STRATEGIC SUPPLY CHAIN PARTNERSHIPS

Leaders should consider how partnerships with others could reduce product or service costs, decrease production time, decrease delivery time to the consumer, and also increase customer satisfaction. For example, if you are making jewelry and need gemstones, instead of using different suppliers inconsistently and purchasing small orders and a high cost, you could consider a partnership. The partnership could result in consistency of quality gemstones, cost discounts because you are purchasing higher volumes, and dependability as you’ll be a top priority for that partner.

STRATEGIC INTEGRATION PARTNERSHIPS

If two companies each have expertise in creating unique products or services, they can combine efforts to create one amazing product. Leaders should consider integrating and combining forces. A great example would be Dell’s partnership with Intel. Dell recognized Intel’s quality processing chips as a necessary component for computers it was manufacturing. Intel did not want to make computers and Dell did not want to make processing chips, so they formed a partnership to offer affordable computers to consumers. This example is also a supply chain partnership as well because costs for the manufacturer are reduced and product availability is ensured by producing and purchasing in high volumes.

STRATEGIC TECHNOLOGY PARTNERSHIPS

Utilizing technology for a variety of reasons, such as managing information systems using cloud-based storage, can be vital to organizational success, especially if the business is operating within the technology industry. It’s important for leaders to assess capabilities and availability of financial resources to use technology to advance the organization. For example, many companies partner with an external cloud services provider to house their data instead of using of internal servers.

STRATEGIC FINANCIAL PARTNERSHIPS

Financial expertise is crucial for businesses to monitor financial indicators of success, including revenue, profitability, and cash flow. If financial or accounting competencies do not exist within your organization, leaders should seek a partnership with an organization that can manage their finances well. One example of a financial partnership would be hiring a certified public accountant (CPA) firm to set up financial reporting processes, audits, and tax filing systems to ensure maximum profitability and efficiency.

Benefits of Partnerships

Although there is always a level of risk involved with a strategic partnership, such as the partner may not deliver what they agreed upon, there are many benefits to partnerships that work effectively. Strategic partnerships may offer all or some of the following business benefits (Cohen, 2014).

BUSINESS BENEFITS

New Customer Acquisition

New Customer Acquisition

Revenue Increases

Geographic Expansion

Product Line Extension

New Technology Access

Increased Resources

Leader as Liaison

The leader’s role as a liaison is to effectively identify, evaluate, and cultivate opportunities for strategic partnerships. It is important that leaders align with other entities who share a common vision and culture (Ehrlichman, 2014). Leaders should also be thinking about how the partnership can build momentum, achieve growth, and be mutually beneficial for both parties. They should focus on how pooled resources will create new opportunities. While leaders are considering potential partners, it’s crucial that they have excellent interpersonal skills such as communication, negotiation, and persuasion competencies. It’s important they can outline the partnership as a “win-win” situation for both entities.

Can you think of a time when you acted as a liaison and built a bridge between two entities that could benefit from a partnership with each other? What skills were important to you in that role?

Organizational Structure and Design

As you have discovered, the environmental factors, or context, that a leader is operating within may have a significant impact on his or her success. It is important that leaders consider contextual or situational factors when selecting leadership styles that can aid them in attaining organizational goals. In addition to considering some of the factors that are pre-existing, it’s also valuable for leaders to consider how they may adapt those factors which may be within their control. Additionally, leaders should consider how they might create an entirely new context that could be ideal for the initiatives they aim to accomplish.

Organizational Structure

One of the most important contextual factors that may impact a leader’s ability to bring people together and accomplish organizational objectives is the structure of the organization. The structure of an organization should be conducive to coordinating the use of resources across functional departments to accomplish tasks. Additionally, leaders should ensure that the organizational structure is aligned the strategic vision and purpose as well. They should also consider the impact that structure and job design may have upon employee motivation and job satisfaction.

\ORGANIZATIONAL STRUCTURE

WORK SPECIALIZATION

Leaders have an important decision as to the level of work specialization that jobs within their organizations have. Work specialization depicts the extent to which labor activities are divided among individuals, or jobs, within the organization (Robbins & Judge, 2014).

When considering how specialized job tasks should be, leaders may consider the skills and expertise required to perform the activities. When you think of an assembly line in a manufacturing facility, typically one or two people work on one aspect of the production line within the plant. Those individuals are trained to specialize in that portion of production, such as packaging, so they are highly familiar with the processes and standards for quality

Specializing work tasks to a granular level may achieve more efficiency and capabilities for employees, but the employees may also become bored as the work is monotonous and the job tasks do not vary. Also, if work tasks are not specialized enough and one person is expected to know and do everything on the production line, that individual may become overwhelmed, frustrated, and uncertain of work processes.

DEPARTMENTALIZATION

Another consideration by leaders is the level of departmentalization , within the organization. Leaders may group jobs according to the functions that they fulfill within the company, such as accounting and human resources.

Grouping experts in like roles together can improve efficiency, expertise, and coordination of efforts. Jobs may also be grouped according to products or services produced or grouped by geographic regions. Product departments can work cohesively to accomplish goals specific to their own product, promoting camaraderie and teamwork

MATRIX STRUCTURE

Lastly, leaders could utilize a combination approach to grouping, which is referred to as a matrix structure, where departments are grouped both functionally and by products or services. Another dimension of a matrix organization may be geographical grouping as well. For example, the consumer products company Procter & Gamble is a global multi-brand company with global business units grouped by brand, housing different functions within each unit (such as marketing and accounting). The units are tied to a brand and geographical area but, to an extent, still interact across brands and functions to achieve higher efficiency.

Although the goal behind the matrix structure is to reap the benefits of both functional and product departments, it can add complexity because employees report to more than one manager. Communication is a key aspect for matrix organizations. As a result of the existing challenges, power struggles may occur between managers and employees could become confused or stressed (Robbins & Judge, 2014).

Organic vs. Mechanistic Organizations

Another element of organizational structure worth considering is Tom Burns’ and G.M. Stalker’s proposed spectrum of structural design between organizations being mechanistic organization and organic organizations(Kreitner, 2011).

Due to the decreased standardization of processes, reduced hierarchical organization, and adaptability to change, organic organizations offer individuals more autonomy in decision-making. Additionally, organic organizations allow companies in facing uncertainty to pivot adapt quickly to changing needs of customers and markets. This characteristic can be quite valuable in today’s dynamic, highly technological, and increasingly global environment. As Kreitner states, “today, the trend necessarily is toward more organic organizations because uncertainty is the rule” (Kreitner, 2011, p. 249).

• ADVANTAGES OF MECHANISTIC ORGANIZATIONS

Mechanistic organizations also offer many benefits in terms of clearly communicated and specialized processes and procedures for members. The standardization and formalization are great for organizations in relatively stable environments. Employees also have a clear chain of command and process for reporting to levels of management within the organization.

Leaders of mechanistic organization are often tasked with decision-making responsibility whereas decisions within organic organizations are distributed across autonomous organizational members. Communication is also more likely to flow from the top-down in a mechanistic organization as opposed to flowing horizontally, between peers, within an organic organization.

• ADVANTAGES OF ORGANIC ORGANIZATIONS

Organic organizations are excellent structures for businesses facing a great deal of uncertainty in markets such as rapidly evolving technology-driven spaces. Flexibility and adaptability allow the organization to respond to sudden changes in the market. The autonomy that organizational members have is also empowering and motivational.

Additionally, organic organizations foster a sense of collaboration and communication among employees. Therefore, empowered and collaborative employees are more innovative. They are more creative than members of mechanistic organizations because they have decreased bureaucracy and greater flexibility.

Organic vs. Mechanistic Organizations

It’s important for leaders to understand that one organizational design model, organic or mechanistic, is not better than the other. Leaders must consider situational factors such as industry conditions before deciding upon characteristics of organizational design. Also, many organizations have components of both types of design and exist along a spectrum. Few organizations are purely mechanistic or organic. Organizational structures are not necessarily static either.

For example, as a small business facing a great deal of uncertainty in the market, it may make sense to start out as an organic organization. The few individuals that comprise the company will perform highly differentiated work tasks. One person may be tasked with marketing, advertising, communications, and public relations. The small team will work together to make decisions and meet changing needs through adapting. As the organization grows and becomes more mature, the leaders may find a niche market with greater certainty. They also may hire additional staff and create a marketing department with each staff performing highly specialized work. That leader could also hand over decision-making to the head of that functional department as well.

Can you think of an experience you’ve had working with an organization that you’d categorize as mechanistic, organic, or a combination of both? Was the structure successful for the company? Why or why not? What kind of organizational structure would you want to lead or be a part of and why?

Power and Influence

As a leader, and liaison, it is crucial to understand power. According to Kreitner, power can be defined as “the ability to accomplish something by organizing human, informational, and material resources” to accomplish goals (Kreitner, 2011, p. 391). It is important to understand that authority to direct the work tasks of others, formally sanctioned by title and organizational hierarchy, is not the same as power. The directions given by those with authority may or may not accomplish desired results. Those with authority may not necessarily have power, and vice versa. For example, an expert team member who others refer to when they have questions about important decisions to be made may have no authority over the team members. However, they possess expert power and may influence the actions or decisions of others.

Bases of Power

There are several bases, or types, of formal power and personal power (Robbins & Judge, 2014).

FORMAL VS. PERSONAL POWER

• FORMAL POWER

The three types of formal power are reward power , coercive power , and legitimate power.

• Reward Power: Legitimate Power is a power derived from one’s formal authority or position within an organization. An example would be a manager motivating employees to achieve high sales performance because they will receive a quarterly bonus.
• Coercive Power: Coercive Power is a Power derived through threatening negative actions as a result of another’s inability to act or comply (the opposite of reward power). One example would be an employee coming to work on time because he knows his manager will take disciplinary action against him, up to and including termination, if he is late.

• Legitimate Power: Reward Power is an encouraging compliance through the follower’s anticipation of positive results or rewards for their actions (the opposite of coercive power). This is the most common type of power. An example would be a senior military officer giving orders to junior ranking officials, which the subordinates will follow immediately.

• PERSONAL POWER

The two types of personal power are referent power and expert power.

• Referent power: Reverent Power is a Power obtained through like, respect, admiration, or desirable resources. An example of referent power would be celebrity endorsements of brands and products. They have power over consumers because they are admired or liked, so consumers will purchase the brands they endorse.
• Expert power: Expert Power is a Power derived from one’s expertise or specialized skills and knowledge. One example would be a patient taking advice from a medical doctor.

Research has shown that the personal types of power, referent and expert power, are the most effective and likely to lead to higher employee performance, commitment, and satisfaction (Robbins & Judge, 2014). This is key for leaders to understand because, though most leaders have formal authority over their followers, formal bases of power are not the most influencing to followers. Therefore, leaders should work hard to gain respect from followers and be experts in their fields when possible. It’s also interesting to note that punishment and reward systems (coercive and reward powers, respectively) are not as motivational as respect and admiration. Personal powers are also crucial for leaders building strategic alliances outside their organizations.

Influence Tactics

Once leaders understand the sources of their powers, they should also be aware of the influence strategies, or power tactics, at their disposal. Here are nine tactics that may be useful for leaders to influence followers’ behaviors (Robbins & Judge, 2014):

LEGITIMACY

Legitimacy is influencing others with your authority or with organizational rules, procedures, or policies.

RATIONAL PERSUASION

Rational Persuasion is influencing others through logic, facts, and reason.

INSPIRATIONAL APPEAL

Inspirational Appeal is appealing to others’ emotions, values, or aspirations.

CONSULTATION

Consultation is influencing others by involving them in your decision.

EXCHANGE

Exchange is influencing others by offering one favor in return of another.

PERSONAL APPEALS

Personal Appeals is appealing to others through loyalty or friendship.

INGRATIATION

Ingratiation is prefacing requests with praise, friendliness, flatter, or humility to make the person feel good.

PRESSURE

Pressure is influencing with threats, warnings, demands or intimidation.

                   COALITIONS

Coalition is influencing others by getting help from others to persuade the individual.

Understanding and possessing various types of power will aid a leader in accomplishing goals with and through others, particularly as they serve as a liaison. Influence tactics may also support leaders’ efforts to engage followers in their goals, but some tactics prove more effective than others. Effectiveness depends on the situation and the direction of influence, such as influencing subordinates, peers, or supervisors. Also, many of the leadership styles you have learned about throughout this course support some, or all, of the power influence strategies. For example, participative leadership involves followers in the decision-making process, which is very similar to the consultation influence strategy.

Can you think of a time that you possessed formal or personal power? What type of power was it and what kind of influencing strategies did you utilize? What was the outcome of the situation?

The Boundaryless Organization and Servant Leadership

Recently, instead of the premise that leaders act in their own self-interest as power seekers, there has been a lot of research surrounding the philosophy of servant leadership. As opposed to leaders putting their own needs first, Robert Greenleaf proposed that servant leadership focused on putting the needs of others and of the organization above the leader’s own needs (Kreitner, 2011).

Servant leaders want their followers to reach their full growth potential through development (Robbins & Judge, 2014). They are trusted listeners who persuade others and enable followers to reach their full potential while achieving organizational goals. Fostering an organizational culture of collaboration, development, and encouragement is important to servant leaders as they act as socially responsible stewards and role models. Servant leadership leads to the overall increased well-being of followers.

Servant leaders should provide direction and serve as the visionary leader you have learned about in this class. They must also communicate that vision to the organization but be especially mindful of what the employees’ needs are. Additionally, the servant leader is a leader of emotional intelligence because they have excellent listening skills and appreciate the feelings of his or her followers. They are empathetic and accepting.

A servant leader is also a participative leader because they let employees’ perspectives and ideas drive how the organizational goals are accomplished. Furthermore, servant leaders are humble and authentic. They lead by example with integrity and values so that all may follow their lead (van Dierendonck, 2011). Servant leadership also aligns well with the leader’s role of liaison and relationship builder as it requires listening and a solid foundation of trust.

Self-Awareness

Listening

Developing Colleagues

Coaching Instead of Controlling

Harnessing Others’ Intelligence and Energy

Changing the Pyramid

(This will be discussed in the next section)

The Boundaryless Organization

INVERTED PYRAMID

According to Keith (2017), servant leadership promotes an inverted pyramid, meaning that the traditional hierarchical reporting structure with one key leader at the top is flipped upside down. This means that teams of the highest-level leaders in an organization provide feedback to each other. Servant leaders are breaking down the vertical chains of command to replace it with an idea that every individual has an important contribution to make to organizational decision-making.

BOUNDARYLESS ORGANIZATIONS

Synonymous with the idea of breaking down traditional organizational reporting structures is the concept of a boundaryless organization. Proposed by former GE chairman, Jack Welch, a boundaryless organization could eliminate barriers both within the organization (horizontally and vertically) as well as barriers to external entities. This would result in an unlimited span of control for managers, which increases the efficiency of the organization (Robbins & Judge, 2014).

Within a boundaryless organization, rank and title of managers are not important because everyone participates in decision-making. Those who would normally be separated into functional departments collaborate with each other via cross-functional teams to accomplish strategic goals. The boundaryless organization also creates strategic alliances and spans geographical locations. They partner with other organizations so that individuals in both entities realize reduced distinction between their entity and the partnering one. The attitudes of ‘us’ and ‘them’ deteriorate and are replaced with ‘we.’

TECHNOLOGY’S ROLE

Harnessing technology is an important part of building a collaborative culture conducive to a boundaryless organization (Morgan, 2013). Today’s collaborative technologies that enable sharing of ideas and content, even with mobile devices, are crucial for organizations to break down boundaries. Like the servant leadership practice of reducing managerial control, boundaryless leaders must redesign jobs to maximize potential performance for every individual and increase the frequency of feedback on their job performance. As opposed to infrequent (and typically annual) reviews, members should be able to share accomplishments and receive feedback from each other in a collaborative way that encourages development and positive performance. Boundaryless organizations enable each individual to become a leader (Morgan, 2013).

How does the leader’s role as a liaison support both servant leadership practices and development of boundaryless organizations? What qualities and skills do you have that would enable you to be an excellent servant leader?

Conclusion

You have learned that leaders have a wealth of considerations when determining the structure and limits of an organization. The best leaders act as liaisons, bridging individuals and entities together to accomplish meaningful goals. Servant leaders bring people together through the creation of boundaryless organizations, built upon trust, listening, development, communication, and collaboration. Clearly, leaders do not realize success on their own. It takes a ‘we’ mentality, realized through strategic partnerships with other entities and individuals, to accomplish amazing feats. Although most leaders have formal power and authority over others, it’s ideal that they are viewed as experts, respected, and liked by followers so they have personal power and influence to motivate people. The opportunities for leaders who are aware of these important leadership and organizational concepts are endless. If you are an excellent liaison and continuously foster relationships with those around you, your success as a leader has no boundaries.

Resources

Cohen, D. (2014, September 22). Top 6 Benefits for Businesses in Strategic Partnerships. Powerlinx. Retrieved from

https://www.powerlinx.com/blog/strategic-partnerships-benefits/

Ehrlichman, M. (2014, April 29). 4 Tips to Go Further, Faster with Strategic Partnerships. Entrepreneur. Retrieved from

https://www.entrepreneur.com/article/233450

Keith, K. M. (2017). Key Practices of Servant Leaders. To Serve First: The Servant Leadership Journey. Retrieved from

http://toservefirst.com/key-practices-of-servant-leadership.html

Kreitner, R., & Cassidy, C. (2011). Management (12th ed.). Mason, OH: South-Western, Cengage Learning.

Mintzberg, H. (1989). Mintzberg on Management: Inside Our Strange World of Organizations. New York, NY: The Free Press.

Morgan, J. (2013, December 4). How to Build a Boundaryless Organization. Forbes. Retrieved from https://www.forbes.com/sites/jacobmorgan/2013/12/04/build-boundaryless-organization/2/#3f4e4263605d

Robbins, S., & Judge, T. (2014). Essentials of Organizational Behavior (12th ed.). Upper Saddle River, NJ: Pearson Education.

Spear, T. (2014, March 6). Five Types of Strategic Partnership Agreements to Help Grow Your Business. PandaDoc. Retrieved from http://blog.pandadoc.com/strategic-partnership-agreement

Van Dierendonck, D. (2011, September 26). 6 Key Servant Leadership Attributes. IEDP. Retrieved from http://www.iedp.com/articles/six-key-servant-leadership-attributes/