Leadership of Meg Whitman at eBay

Introduction

Leadership is defined as the social process under which a person can utilize the support of others to achieve a common goal and forms one of the most relevant and important aspect of organizations. Leadership is ultimately about creating a way for people to contribute to making something extraordinary happen (Limsila and Ogunlana, 2008). Leadership style refers to the manner and approach in which directions, motivation, planning, and implementation of projects are executed. The process of coming up with the right and effective approach to leadership is complex and many considerations must not be left aside. Managers have the daunting tasks of having a deep knowledge of one’s level of skills but also his experience and the type of work involved (Limsila and Ogunlana, 2008). This can be a routine job, new or creative jobs that require different ways of approach on a daily basis. Furthermore, knowledge of the environment in which the organization is operating is vital in the sense that some organizations are faced with very dynamic environments that also demand new and appropriate styles of leadership. Lastly, a manager must understand himself and determine his own style of leadership.

Transformational Leadership

Burns (1978) has defined Transformational leadership as the type of leadership that may be regarded as an inspirational style of leadership, in which the members of an organisation are influenced to move in a set direction through the recognition and satisfaction of their wants, needs, aspirations and values. It is worth paying due recognition to the fact that to set direction in leadership, a leader must have the support of the other team members. This can be achieved by the sharing and collaborating with other people as has been demonstrated from the analysis of vast literatures on transformational leadership.

Findings of a number of research works have showed that a transformational leadership style was the most effective on employees in most organizations (Limsila and Ogunlana, 2008). A transformational leadership style can significantly determine more efficient quality management practices that can further be associated with better work performance and greater organizational commitment. As opposed to other leadership styles, the transformational style of leadership also creates higher leadership outcomes such as effectiveness, satisfaction, and more efforts from the members compared to the transactional style (Limsila and Ogunlana, 2008).

Furthermore, the transformational leadership style is comprised of idealized attributes, which help determine whether leaders can establish trust among their subordinates, idealized behaviors referring to leaders who possess the ability to communicate. It has the capacity to demonstrate values and behaviors that are of great importance such as honesty, reliability, and self-control. It also seeks to inspire the motivation to identify whether leaders have the capability of inspiring and motivating others; intellectual stimulation to determine whether leaders are capable of driving people to become inventive and innovative; and  individual consideration which identifies leaders who are able to understand people’s needs and help develop their full potential as well (Bass and Avolio, 1997).

At present, one of the most common starting point of numerous studies is that leadership in organizations is one of the strongest components that influence people to carry out their duties using motivational approaches instead of being centered on power or authority alone (Kotter, 1996). This description focuses on the subordinate’s decision to carry out a task due to his own free will and significantly rejects the use of force, power or  actions that are driven by threats or intimidation by the managers who are considered as leaders as well. This definition also makes it clear that leadership is different from coercive actions although it associates leadership with informal influence and power along with a lesser degree of formal authority, which is normally present in working environments. When people obey an individual of authority, it is mostly difficult to determine whether they are taking such actions out of their own free will or because fear any form of punishment from their superior. Therefore, Wang et al (2005) suggest that modern theories on leadership have become centered on transformational leadership than in other types of leadership.

The current theories on leadership, nonetheless, are mostly focused on transformational and transactional leadership, which have been first introduced by Burns (1978) and were further expanded by Avolio and Bass (1991). According to the “full range model of leadership,” two levels of influence exist between a leader and those who are being led. One influence is generated by the understanding that is created by the leader with which subordinates believe that they will act in accordance with their leader’s goals because of their belief that they will receive benefits when taking such actions. This is called transactional leadership. On the other hand, the other influence of the leader is referred to as transformational leadership because it brings about emotional excitement and inspiration among the subordinates brought about by the relationship that their leader establishes with them (Bass and Avolio, 1993). Using transformational leadership, employees become more aware of their need to grow and are further motivated to perform better and at higher levels (MacKenzie, Podssakoff, and Rich, 2001). A transformational creates change in the subordinates’ beliefs and values, influences their expectations, and provides them with their needs based on the hierarchy of needs. Burns (1978) asserts that transformational leadership results to the subordinates eventually becoming leaders and the leaders becoming moral agents. Therefore, transformational leadership is the outcome of a leader’s character, the intensity of his beliefs and values, and his ability to express and communicate an influential vision (Dvir, 1998; Lowe, Kroeck, and Sivasubramaniam, 1996).

Avolio and Bass (1991) further delved into the concept of leadership and suggested that there are eight styles of leadership behavior using the data gathered from their study of 78 managers who were asked to describe the most significant characteristics of leaders that had a personal influence on them. Three styles of leadership were found: no leadership, transactional leadership based on submissive and active aspects, and transformational leadership based on strong relations, intellectual change, inspiration, and motivation (Avolio and Bass, 1991). These three categories develop a sequence of leadership depending on the values that the leader expresses in his action as well as its effectiveness. In this model, the transformational leadership is considered the most effective style, followed by the transactional leadership, then the no leadership style (Avolio and Bass, 1991). The full range of leadership model suggests that all leadership styles can be found in every leader. This approach was tested by Den Hertog, van Muijen, and Koopman (1997) among Dutch managers with which similar factors were found (transformational, transactional, and no leadership).

Transactional Leadership

Aside from transformational leadership, current theories also talk about transactional leadership, as introduced by Burns (1978) and expounded upon by Avolio and Bass (1991). The full range model of leadership portrays two kinds of influence in a leadership-subordinate relationship. The first stems from the understanding that inspires belief among subordinates that the leader’s goals will benefit them, encouraging them to work towards these goals – transactional leadership. This indicates that the relationship between leaders and subordinates that emotionally excites and inspires the latter. This allows employees to experience greater awareness of their need for growth, which in part elicits greater performance from them.

Transactional leadership is comprised of contingent reward that determines whether leaders clearly assign tasks to their subordinates and whether the work done by these employees are provided with the appropriate reward or punishment; and management-by-exception: active that refers to the ability of leaders to facilitate unproductive performance (Bass and Avolio, 1997). It is based on the premise that total obedience and loyalty to the team leader and that the organization rewards employees for their concerted efforts and compliance to the rules and regulations (Burns, 1978). This gives the leader the right to punish any employee whose work fails to meet the set standards. While this system does little to improve employee satisfaction, greater levels of productivity can be achieved by giving the employee a large control of their incomes by the application of incentives as it incorporates the approach of “management by exception” where corrective measures are taken in instances of underperformance. Lastly, transformational leadership seeks to inspire employees with the aim of having a shared vision. This class of leaders does not lead from the front, are always visible, delegate most of their roles, and spend a big part of their time communicating.

Appropriate Leadership Approach for Whitman at eBay

A number of research works had led to the conclusion that leadership drives organizational as well as individual performance (Wang et al, 2005). Most studies have also revolved around the study of leadership styles and how they affect quality management, organizational commitment, and work performance, with the intent of encouraging project managers to change their leadership behavior in order to boost these qualities. There is wide abidance in the fact that that the transformational leadership style worked best for them, thanks in part to its ability to pinpoint the most efficient quality management practices that in-turn translate to better performance and commitment. Not to mention, the employees become more effective, satisfied, and driven. This is supported in part by the current results, where transformational leadership, along with transactional leadership has lead to effective TQM outcomes. The analysis of the organizational culture at eBay and the comparative analysis of transformational and transactional leadership styles point to the fact that transformational style would be the best approach for Whitman at eBay.

House and Aditya (1997) who post that leadership in organizations boils down to the leader’s behavior and key traits, or those situations in which the effects of leadership can be easily observed also support this fact. House (1995) asserts that leadership helps express a vision to one’s followers and subordinates. Organizational values become more apparent, more effort is exerted, and one becomes more open to the idea of denying himself for the good of his subordinates (House, 1995).

Most studies often start by attesting to how leadership is up there when it comes to getting people to attend to their duties by motivating them (Burns, 1978). In the context of eBay’s objectives and culture, the behaviors that motivate successful empowerment and satisfaction have been expressed extensively. In such an approach, subordinates freely choose to carry out their tasks rather than being forced, coerced or otherwise threatened by managers and leaders. Thus, while leadership does involve influence, power, and authority, it is wholly different from coercion. It is often difficult to ascertain whether people’s obedience of authority stems from their free will, or because they fear punishment if they disobey. Wang et al (2005) thus speculate that modern leadership theories in particular have given notable focus on the concept of transformational leadership. This has been confirmed in the present research, where transformational leadership behaviors are apparent, to influence subordinates to participate effectively in the overall achievement of organizational goals.

Evaluation of Whitman’s Approach to Leadership at eBay

Potavin (2006) describes a true leader as one who maintains an uncompromising adherence to an internalized, but otherwise generally accepted code of moral values; who adheres to utter sincerity, honesty, and candor in all communication; and who avoids deception, expediency, artificiality, or shallowness of any kind in all situations (Limsila and Ogunlana, 2008) . In addition to the above, Potavin (2006) explains, true leader must have vision, open to change, create other leaders, value the contributions of others, and possess the element of integrity (Limsila and Ogunlana, 2008). A deep examination on leadership style of Whitman reveals that she has most of these qualities and is able to use effective leadership to propel her to the position of the CEO at eBay.

The line of action taken by a leader largely depends on a wide range of situational factors, organizational cultures, and objectives. In the analysis of Whitman’s approach to leadership at eBay, she asserts the importance of being respectful of culture and past achievements when entering a new company. Her approach to leadership entailed critical factors of success such as setting priorities, developing an investment strategy for system capacity, developing eBay’s marketing strategy. In the design of an effective leadership approach to employee development, Whitman employed both transformational and situational leadership approaches while at the same time taking a keen cognizance of a list of factors to ensure effectiveness and parameters to evaluate the level of effectiveness. However, the analysis of Whitman’s successful approach to leadership at eBay revolves around being sensitive to the complex local context, creating synergy, constantly inspiring practice, leading as serving, and valuing others.

Being Sensitive to the Complex Local Context

Effective approach to leadership involves the gaining of the knowledge of the social phenomena by appropriately paying attention to the socially constructed meanings that we come across in the context of daily challenges. The analysis Whitman’s successful approach to leadership at eBay can be seen in being sensitive to the challenges of the local environment, considering the cultures and roles of close associates and serving their needs, while at the same time having determination to make a positive contribution. This means that to effectively become an effective leader, there is the need to fully come to the realities of the existing local context.  In the understanding that the challenges that demand the application of ethically sound leadership are likely to increase in the near future as expressed by Burns(1978), the fact is that effective leadership is definitely bound to have more complex dimensions and demanding perspectives.

This fact is buttressed by Limsila and Ogunlana (2008) in stating that

This prevailing context of cynicism and perplexity about falling leadership standards coupled with the increasing complexity of the workplace has impelled the search and call for alternative leadership paradigms that are more value-driven, ethical, credible, compassionate and people-centred (p. 1).

By appreciating the role of team members and how special the chemistry was between eBay’s internal and external communities, Whitman drove in the inclusive approach to leadership that sought to appreciate the diverse thoughts of team members. To achieve sound leadership that is compassionate and people centred, Whitman appreciated the need to understand not only the unique cultures at eBay but also the complexities and make adjustments in regards to leadership styles to the local context.

Having a complete analysis of the economic, political and social aspects that surround the organization has the capacity to enable a leader discharge his or her services in sound manner. The results of  the analysis of Whitman’s leadership approach also indicate that leadership is not theoretical but is practical in that they act within the applicable and practical wisdom that draws its basis form the existing realities. In the understanding that motivating others has a moral nature because it is concerned with the development of human beings in all dimensions. To understand this moral perspective of business management, there is need to underline the importance of Being Sensitive to the Complex Local Context.

Creating Synergy

The creation of synergy among employees has been pointed to as one of the best strategy through which a manager can enlist the support of executives and mid level managers in attempts to motivate employees. This is because it enhances the sharing of common interests and perceptions. According to House (1995), “a skilled and seasoned synergy creator knows very well how to bring each member together, making them work as a group rather than on an individual approach.” This comes along with the advantage that the executives and mid level managers within then chain of command will have a firm view that they form part of the changes brought about by the training programs. It is imperative that the training programs manager will reap benefits by participative approach that is a product of synergy development. The analysis of Whitman’s case study reveals the strategy of employing an inclusive approach that elicits a collective creation of synergy from employees and team members.

Valuing Others

Valuing others includes a distinguished view of others, respect for individuals and relationships, constant interaction and communication with people, and shared leadership. The analysis of Whitman’s leadership approach at eBay  project that having a fundamental respect for others and relationships has been considered as a critical factor in successful leadership within the context of organizational leadership and is considered central by all stakeholders. This is an approach to transformational leadership that has been adopted by Whitman. The pivotal role of valuing the contributions of others and having a fundamental respect for others’ opinions constitutes the definitive elements of transformational leadership. Within the context of transformational leadership, this approach has been demonstrated as fundamental commonality in the analysis of the case study material.

Within this emerging theme House (1995) notes that leading from an ethical perspective is about working interdependently to construct a collective good for an organisation. This means that effective leadership calls for a collective responsibility for the achievement of set goals and objectives. The importance of giving enough value to others is echoed by Burns (1978) in succinctly stating that “leadership is a process of morality to the degree that leaders engage with followers on the basis of shared motives and values and goals” (p. 36). It is imperative and common knowledge that to effectively engage, influence followers and share values, beliefs and goals, each participating side of the engagement must appropriately value the opinions and contributions of others. In fact, this technique of leadership has been documented to have the greatest effect on its ability to influence others and achieve their trust and loyalty.

In addition to the above, Bass and Avolio (1997) supports the contribution of valuing other people in leadership by stating that effective leaders understand and respect others’ values and, in turn, seeks to reconcile the potential tensions between personal values and people or organisational values.  Most participants have also abided in the idea that valuing other people is the best strategy to the development of quality relationships that is critical for human diversity. The abidance in the critical role of valuing other people has been advanced by a number of literatures in the analysis of effective leadership.

Consistently Inspiring Practice

The analysis of the case study material on Whitman at eBay points to the critical component of consistency in organizational ethics, values, beliefs and principles. In fact, consistency forms a basic trait in leadership standards, forms a major theme in transformational leadership and transcends all levels and forms of leadership. Whitman’s leadership approach is encompassed by a process that involves continuously influencing people and staying consistent throughout.

In the understanding of Whitman at eBay, the core values that define her leadership in the context of organization is character, honesty, integrity, equity, trustworthiness, self-discipline, courage, fairness, generosity, passion, compassion, optimism, service, encouragement, and love as illustrated by (Bass and Avolio, 1997). These demonstrate the ethical leadership within this context must be devoid of controversy but compounded by consistency. Furthermore, consistency of values forms a critical component of transformational leadership. In this regard, a leader is likely to lose support and following in the event of lack of consistency because the ability to stay consistent forms the true definition of effective leadership. This is in the view that employees look up to the leaders and the process of staying along the path of consistency must be continuous. This therefore calls for persistence and consistency on the part of the leader to avoid losing support due to the waning of positive forms of influence precipitated by lack of consistency.

Consistency therefore forms entrenched beliefs and values of leader in that in influencing others to follow their steps, leaders within organizations pursue a moral cause that is definitely not a one instant or a cause that is of short period as demonstrated by Whitman in the Developing an Investment Strategy for System Capacity.  The ideology of consistency in transformational leadership within an organization is a key determinant to success.

Leading as Serving

As has been stated, serving others is placed as an important characteristic of effective leadership, which seems to be connected with vocation and the search for excellence. Case study reveals that sound leadership as selfless service to the people. In fact, the analysis of the case study reveals that Whitman holds a view that the opportunity of being a CEO is to take the role of a servant to others.

Conclusion

Effective leadership approach to organizational management is a multifaceted issue. It is necessary to be able to identify and manage all potential difficulties. The outcome associated with the successful development and implementation of such programs is worth the effort. Success will depend to some extent on the size of leadership approach. Leaders and managers attempting to find and resolve all leadership difficulties and potential difficulties may not find the issues presented here as all-inclusive as there are a lot more issues that must be recognized for leadership. However, the analysis of the case study material reveals that Whitman reveals that she has employed transformational leadership approach in the realization of eBay’s goals and objectives. This is because she has managed to set direction in leadership and have the support of the other team members.

This has been achieved by the sharing and collaborating with other people and employees. This has also been demonstrated by her capability of inspiring and motivating employees. The ability to determine more efficient quality management practices that can further be associated with better work performance and greater organizational commitment and create higher leadership outcomes such as effectiveness, satisfaction, and more efforts from the members is a demonstration of extensive application of transformational leadership. Last, Whitman’s approach to leadership focuses on the subordinate’s decision to carry out a task on own free will and significantly rejects the use of force, power or  actions that are driven by threats or intimidation by the managers who are considered as leaders as well.