Research Hub https://research.alexanderchekanov.com Management Sciences Research Thu, 25 Jul 2019 14:27:39 +0000 en-US hourly 1 https://wordpress.org/?v=5.2.2 Our illusion of network neutrality https://research.alexanderchekanov.com/2015/05/28/our-illusion-of-network-neutrality/?utm_source=rss&utm_medium=rss&utm_campaign=our-illusion-of-network-neutrality https://research.alexanderchekanov.com/2015/05/28/our-illusion-of-network-neutrality/#respond Thu, 28 May 2015 22:24:55 +0000 http://www.alexanderchekanov.com/?p=58 network neutralityThere’s a growing debate whether the current network neutrality of Internet can be considered as such. One can argue that, apparently, given that Internet is not “owned” by someone that’s why there’s no one who can govern the behaviors of its users.
Indeed, the bright side of it is that we can see the development of collective knowledge as an example of a desirable behaviour. On the dark side – the proliferation of computer viruses and hacking. But the question is – can we consider that Internet nowadays has still any kind of network neutrality at all?

Our illusion of network neutrality

Let’s analyze what we mainly use Internet for: searching stuff; and sending and receiving stuff. In other words – if we look at the functionality that we expect that Internet will provide us as a platform – we’ll mainly see that most of the use is oriented towards looking for answers for the questions we might have. Now, where we’ll be asking those questions and seeking our answers? Indeed – in any of the main searching engines that exist. Nevertheless, that might not represent itself a significant issue for the network neutrality if the existing players were fragmented enough so none of them could be in a position that allowed (potentially) biasing the results of our search results. Anyhow, let’s assume that there’s a scenario in which few large players could be performing almost the totality of all the searches performed on Internet. In such scenario we then might look at whether there could be any potential incentive for any of the search providers to benefit from a potential bias in the search results. In other words – even they might have the possibility for doing so – what would be the incentive for them? (At this point I should say that any similarity of the assumptions with reality should be considered as a mere coincidence).
Let’s bring the previous scenario on step further – let’s assume that some of those large players might provide, beyond their search services, other services that could be competing with the services that other third parties offer through the same network and that can only be found through the few big search engines that exist. It becomes evident that even assuming that there’s no “proven evidence” of any bias in the search results, what would be the credibility for the end users that any of those search engines are complying with fair play practices and are truly neutral in their search results?
Given that human beings tend to form their perception of the world based on their experiences and the information they receive from the environment, what could be the implications when we might “suddenly” realize that Internet is no longer neutral? As long as there are incentives for any of the search engines (working as network nodes) that would reward any acts of subversion of the Internet platform to take advantage by controlling it, it would probably  be naïve to debate who really controls the opinions of the masses. Let’s see where lobbyist lullabies will bring regulators, but I’m afraid that, regrettably, our network neutrality has already vanished long time ago without us even noticing it.

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The strength of weak ties in business https://research.alexanderchekanov.com/2015/03/13/the-strength-of-weak-ties-in-business/?utm_source=rss&utm_medium=rss&utm_campaign=the-strength-of-weak-ties-in-business https://research.alexanderchekanov.com/2015/03/13/the-strength-of-weak-ties-in-business/#respond Fri, 13 Mar 2015 16:08:24 +0000 http://www.alexanderchekanov.com/?p=45 The strength of weak ties

Mark Granovetter, an American sociologist and professor at Stanford University, in May of 1973 introduced his theory on the spread of information in social networks known as “The Strength of Weak Ties”. For more reference – his paper “The Strength of Weak Ties” was published in The American Journal of Sociology (Vol. 78, No.6, 1360-1380).
In his theory, Granovetter suggested a tool for linking micro and macro levels of sociological theory and stressed the cohesive power of weak ties in social networks in a moment when existing network models mainly focused on studying strong ties in small and well-defined groups.

The strength of weak ties in business

Strength of weak ties diagram
The strength of weak ties in business innovation can become highly relevant, especially in competitive environments where product life cycles are becoming shorter and shorter. Therefore, even a small advantage in product or service innovation can be crucial for a company to succeed or to keep being a successful innovator. However, in a setting where resources are scarce and time is limited, should those resources be invested in strengthening and developing few but robust relationships with other firms? Can the weak ties with other companies be neglected by simplifying and following, for example, the famous 80/20 approach?
Granovetter suggested that the “strength” of interpersonal ties could be measured based on the amount of time, the emotional intensity, the intimacy, and the reciprocal services which characterize the tie. Bringing that perspective to the management field the “strength” of a tie between two companies could be also assessed in a similar manner. For example, one could suggest taking into consideration:

  • 1) The amount of time that two companies spend interacting with each other.
  • 2) The intensity of the relationship depending on the amount of resources that both companies exchange with each other.
  • 3) The degree of openness and accessibility to each other’s know-how.
  • 4) The services or products that they provide to each other and the relevance of such services or products in their business models or value chain.

All the aforementioned dimensions can be independent from each other and at the same time highly related and could potentially determine whether a tie between two companies can be classified as strong, weak or absent.
The reason why I’m concerned about the strength of weak ties in business relations is because the idea of complexity reduction probably became too widespread in management. I would not challenge that the reduction of complexity makes sense, for example, from an engineering perspective given its cost reduction potential through all the supply chain and product development process. Nevertheless, when looking at this complexity from a business network perspective I still wonder whether this approach applies. The formula of complexity reduction has been happily applied by many consultants without even being challenged most of the times.
strength-of-weak-ties
Building on Granovetter’s work, the strength of weak ties in business innovation can become highly relevant as a higher diversity and variability of inputs (e.g. customer feedback, technological breakthroughs, unexpected product/service use and functionalities) might provide new ideas for product developers to create something new and innovative. Moreover, taking into consideration how relevant businesswise these weak ties can be and elaborating further on Granovetter’s “The Strength of Weak Ties” theory, there’s already a set of questions, as food for thought, that might definitely change the perception and relevance of weak ties with other companies. Some of these questions are: What is the relation between the strength of a tie with one given business partner and the degree of specialization of the companies? What is the relation between the strength of a tie and the hierarchy of the business partners in the value chain? How can “negative” ties be handled or turned around to bring more value to the company? And last, but not least, how the network of a given company (successful or not) develops over time depending on the type of ties it establishes with other companies? All these questions are just some food for thought for future discussions.
I’ll be looking forward to keep elaborating further on this topic and do my best to come back with some possible answers.

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Heads up for mobile indie developers https://research.alexanderchekanov.com/2015/01/22/heads-up-mobile-indie-developers/?utm_source=rss&utm_medium=rss&utm_campaign=heads-up-mobile-indie-developers https://research.alexanderchekanov.com/2015/01/22/heads-up-mobile-indie-developers/#respond Thu, 22 Jan 2015 17:39:36 +0000 http://www.alexanderchekanov.com/?p=23 indie developer

What Every Mobile Indie Developer Needs to Know?

While conducting my research and talking to different industry experts (indie developers, video game publishers, etc.) there’s usually a set of comments that have been popping up consistently that are worth to be mentioned in this dedicated post as a heads up.

Cost of user acquisition

One of the main concerns pointed out by many indie developers (and not that indie) is the increasing cost of user acquisition to which some games advertising platforms are contributing. Some of the publishers cited that for mobile gaming the cost is already getting closer around $2 per user (and growing) while for high end titles the cost of user acquisition could range between $8 and $10.
As already known, the cost of user acquisition is one of the key aspects that is taken into account by the publishers in order to engage in commercial partnerships with video game developers and usually depends on the platform a game is targeting. Nevertheless, other important factors that are taken into account are also the potential of the video game for having organic downloads and its long term value (e.g. its potential to generate money on the long run).

Top 3 indicators for indie developers’ game assessment

When asked about what indicators are considered by publishers when assessing whether to support a new initiative or not, most commonly the following were mentioned:

  1. The use of best practices in the game design (e.g. layout, game structure, etc).
  2. The monetization model of the game.
  3. The marketing plan and the users acquisition cost and strategy.

Role of the video game publishers

There’s also a consensus that the role of the video game publishers have gradually moved from just a distributors role to a “teachers” or mentors role. There’s a growing trend in the industry, specially concerning indie developers, that publishers are focusing more and more on proactively helping the video game developers to get the game on the right level of quality to increase its chances to succeed. In such competitive setting such trend makes sense as when looking at the overall picture – video game developers and publishers had always their (at least economic) incentives aligned, so the outcome can be expected to be a “win-win” for both parties.

Leveraging existing intellectual property

Another interesting point highlighted by some of the video game publishers is that the using and leveraging the existing intellectual property for new games in most of the cases directly contributes to more downloads at the moment of releasing the game. Leveraging existing intellectual property lowers the cost of users acquisition and, therefore, ensures faster growth of the video game’s user base. This point seems to be specially relevant given the constant growth of users’ acquisition costs, so it won’t be surprising if at some point paying the royalties for the use of 3rd party intellectual property might offset the cost of regular user acquisition on some of the platforms.

“Paid vs Free” models

Regarding the never ending discussion of “paid vs free” models, most of the interviewees agreed that although for some very specific mobile games the paid model might still be valid, it might barely account for the 5% of the cases. More and more users expect to try a game before buying it and, therefore, the free to play model is becoming the dominant one. There’s a consensus that paid games might build stronger brands but, at the same time, they might also generate higher expectations from the users that need to be fulfilled on a regular basis.

Industry reference indicators

Finally, and as an industry reference of best practices, most of the publishers agreed that they do look more for the top grossing games charts than for the top downloads. Moreover, when talking about users’ retention rates it is worth mentioning that it is expected that after the first day 40% of the players who downloaded the game will still be playing it, after the 7th day 30% of those who got the game will still be playing and after the 30th day at least 10% of players will still be playing it.

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Technological lockout https://research.alexanderchekanov.com/2015/01/21/technological-lockout/?utm_source=rss&utm_medium=rss&utm_campaign=technological-lockout https://research.alexanderchekanov.com/2015/01/21/technological-lockout/#respond Wed, 21 Jan 2015 15:05:55 +0000 http://www.alexanderchekanov.com/?p=26 Technological lockout

technology lockout
Technology markets tend to be extremely path dependent and such path dependency implies a significant exposure to random events that might lead both, to the success or the failure of a given technology. Nevertheless, there might be a set of factors and firm strategies that could be outlined and that can influence the adoption of a certain technology.
There’s a natural trend in technology markets in adopting a standard or a dominant design (e.g. a product configuration or certain platform architecture). However, the adoption of a dominant design increases the risk of a technological lockout if there’s a change in the market to a different standard or a different technology solution. Good examples of such changes could be observed in the battles between VHS and Beta standards, or the Blue-ray and HD DVD standards. In both cases the companies whose standards were rejected were still able to rejoin the market, but in some cases firms might end up having a double technological lockout (e.g. when the standard they are trying to rejoin is patent protected).

So what is a technological lockout?

Some scholars in academia that have closely studied this phenomena (Schilling, 1998) define technological lockout as “a situation in which a firm finds itself unable to develop or competitively sell products to a particular market because of technology standards.”
Therefore, understanding the phenomena of technological lockout becomes specially critical for fast-cycle industries, where product life cycles might be less than 2 years because falling behind might drive a firm directly out of business. Nevertheless, when looking back and observing some of the most representative technology disruptions – it is not always that the technically most advanced solutions become the most successful ones. Other factors, such as timing, adoption speed and even a promising future use of a certain technology can become even more important than the technological improvement itself.

What might lead to technological lockout?

The most common answer would be “a mixture of several factors”, but as some scholars suggested (Schilling, 1998) the main three reasons could be:

  1. The suggested standards do not meet customer’s expectations in terms of quality, features or price.
  2. There’s not enough critical installed base for the technology or there’s a lack of complementary goods.
  3. Inappropriate market entry timing (e.g. introducing a technology in an emerging market or into an already established market).

How to mitigate the risks of a technological lockout?

Beyond understanding more in detail the reasons why first of all a firm might end up in a technological lockout, from digital platforms’ perspective looking at such concepts as platform modularity might provide some hints. Moreover, certain platform architecture design principles might help to approach some specific issues as how to have more chances in successfully overcoming the bootstrapping phase of a platform. Observing the three main reasons on why a technological lockout might happen it’s possible to argue that probably focusing on solving the second of them – achiving a critial installed base, might indirectly contribute to approach the other two reasons that might lead to a technological lockout. Therefore – a further discussion on the link between technological lockout and platform architecture design principles might shed some more light on this topic.

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Mozilla and game development in HTML 5 https://research.alexanderchekanov.com/2015/01/06/mozilla-game-development-html-5/?utm_source=rss&utm_medium=rss&utm_campaign=mozilla-game-development-html-5 https://research.alexanderchekanov.com/2015/01/06/mozilla-game-development-html-5/#respond Tue, 06 Jan 2015 16:14:27 +0000 http://www.alexanderchekanov.com/?p=6
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Building a development collective https://research.alexanderchekanov.com/2015/01/06/building-development-collective/?utm_source=rss&utm_medium=rss&utm_campaign=building-development-collective https://research.alexanderchekanov.com/2015/01/06/building-development-collective/#respond Tue, 06 Jan 2015 15:44:11 +0000 http://www.alexanderchekanov.com/?p=12 Building a development collective

Glitch City
Usually independent developers and small development teams don’t have access to the same resources as large companies. Nevertheless, teaming up with other developers they can increase their reach, leverage their existing resources and find new collaborators for their projects. However, larger collectives imply more complex challenges, so reviewing a panel discussion from the members of LA’s Glitch City collective might provide some hints on where to start.

Where to start?

In the last GDC Next 2014 Teddy Diefenbach (Game Designer at Heart Machine), Akira Thompson (Game Designer at RainBros), Asher Vollmer (Independent Game Developer), Sam Farmer (Independent Game Developer) and Benjamin Esposito (Founder at Little Flag) covered how a group of independent developers built a development collective (Glitch City) highlighting its benefits for indie developers.
All the panel members highlighted that  joining a development collective offered them a unique opportunity to build a support network as indie developers while at the same time still being able to work each of them on their individual projects. Such development collectives allow their members to share the different challenges they have to face during the development phases of their apps or video games and, therefore, receive feedback from their fellows on how to overcome those challenges. Such challenges can range from technical to business ones (e.g. what is the best tool or approach to use to reach certain goal in the functionality or module they are developing; or validating and discussing business ideas and monetization issues).
In such development collectives there might be a set of different  dynamics between the developers of such communities oriented to help each other. As the panelists shared – the main value of such dynamics is that they offer the opportunity to share and provide know-how to other developers on an altruistic base. This trust based relationship allows video game and software/apps developers to  overcome on an individual base the challenges they face in a very competitive environment and, therefore, such development collectives seems to be effective ecosystems to ensure the survival of its members that, otherwise, might not be that successful.

How to get into such development collective?

Usually, the way to access such communities is through a screening process of the new members that would like to join such collective and the criteria are usually based on seeking complimentary profiles that could enrich the community. Initially the starting size of the community might vary but it is usually below 10 developers. After several years such communities might grow up to 15 or 20 developers, but apparently there seems to be a limit in the growth potential of such ecosystems as the relationship between its members is kept on an informal and friendly level, so due to a lack of formal mechanisms to handle such groups, too large communities become unmanageable. Moreover, one of the key elements for such development collectives to succeed seems to be the fact that each member is expected to bring to the community their contacts, skills and ideas and the development collective is expected to organize regular community events (e.g. brainstorming, group updates on who is doing what) to keep everyone up to date with what is happening, so personal and professional fit plays a significant role for such development collectives to be successful.

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Introduction to Neo Institutionalism https://research.alexanderchekanov.com/2012/12/12/introduction-to-neo-institutionalism/?utm_source=rss&utm_medium=rss&utm_campaign=introduction-to-neo-institutionalism https://research.alexanderchekanov.com/2012/12/12/introduction-to-neo-institutionalism/#respond Wed, 12 Dec 2012 17:52:16 +0000 http://www.iwpro21.com/blog/?p=188 Neo Institutionalism describes a revival of the interest for the study of institutions which occurred during the mid-1970s and is linked to a growing interest in the environment in which organizations are embedded that started in the 1960s, according to William Richard Scott, Institutions and Organizations (1995). Neo Institutionalism puts the emphasis on cognition. Neo-Institutional theory can be linked with streams of research in sociology, economics and political science.

Neo Institutionalism vs New Institutional Economics

Neo Institutional theory is quite different from New Institutional Economics (NIE). NIE is also called “Transaction Cost Economics”. Transaction Cost Economics is interested in explaining governance forms from an economics perspective. It does not focus on the institutional field in which organizations are embedded.

What type of questions Neo Institutional theory attempts to address?

According to  William Richard Scott, Institutions and Organizations (1995) Neo Institutional theory can address such questions like:

  • Why do organizations of the same type, such as schools and hospitals so closely resemble each other.
  • Why is it that the behavior of organizational participants is often observed to depart from the formal rules and stated goals of the organizations.
  • Why and how do laws, rules and other types of regulative and normative systems arise
  • Why do specific structures and practices diffuse in ways not predicted by the particular characteristics of adopting organizations
  • Why do organizations and individuals conform to institutions, is it because of rewards, moral obligations or because they cannot think of any other way of behaving?
  • Or why if institutions promote stability, how does change occur?

Legitimacy

Meyer and Rowan observe that the assumption that organizations function according to their formal blueprint: coordination is routine, rules and procedures are followed and actual activities conform to the prescription of formal structure is challenged by empirical research on organizations. This research drives some questions like why is there decoupling between activities and formal organizations or why are evaluation system rendered vague or ignored?

To answer this question, Meyer and Rowan look at the institutional sources of formal structures and argue that scholars who have focused on the norm of rationality have overlooked another source of formal structures discussed by Max Weber – the concept of  legitimacy.

According to Suchman (1995), legitimacy can be defined as a generalized perception or assumption that the actions of an entity are desirable, proper, or appropriate within some socially constructed system of norms, values, beliefs, and definitions. So Meyer and Rowan argue that rationalized structures are legitimate. In a complex network of interactions, rationalized myths (unverified stories) are necessary for actors to make decisions. They are beyond the discretion of an individual. Therefore they are taken for granted as legitimate, independent of evaluations of their impact on work outcomes.

Isomorphism

Isomorphism helps organizations to interact with their environment and enhance their chances of survival. Organizations adopt recognized formal structures and conform to external assessment criteria (e.g. accounting norms).

An highly institutional environment stabilizes both external and internal relationships. Organization that conform to institutional constraints are seen as legitimate and this enhance their survival chances and this occurs independently from efficiency criteria.

But how do organizations achieve efficiency in an highly institutional environment?

While organizations conform with established myths, organizations have to resolve the inconsistencies between these norms and the achievement of efficiency. Goals and norms are stated in vague term allowing coordination and mutual adjustment to be done informally, so the actual organization is “decoupled” from the formal organization.

The “Iron cage” is revisited through institutional theory

Powell and DiMaggio take Weber’s “iron cage”of rationality, driving the formation of organizational structure, and revisit it through the institutional theory, observing that organizational structure is not necessarily driven by efficiency. While Meyer and Rowan talked about the environment and networks of relations, Powell and DiMaggio use the concept of field for that, so they define it as “a recognised area of institutional life” which does not only comprise organizations that compete or interact but a more comprehensive set, a set of empirically defined “relevant actors”.

Three mechanisms of institutional isomorphic change operate at the organizational and field level:

  • Coercive isomorphism results from internal and external pressures by actors such as the State.
  • Mimetic isomorphism is associated with uncertainty. Mimetic behavior occurs when the environment is uncertain and solutions are unclear.
  • Normative isomorphism is associated with professionalization. A category of professionals identically trained implements some norms across organizations.

Organizational predictors of isomorphism

In terms of the organizational predictors of isomorphism, it is possible to outline the following ones:

  • The higher inter-organizational dependence (including centralization of resource), the greater the level of coercive isomorphism.
  • The uncertainty between means and ends and ambiguity of goals fosters mimetic isomorphism.
  • The more reliance on academic credentials in choosing personnel and participation in trade and professional organizations, the greater the level of normative isomorphism.

Field predictors of isomorphism

In terms of the field predictors of isomorphism, it is possible to outline the following ones:

  • The dependence of the field on a single source of support and level of transaction with the state fosters coercive isomorphism.
  • Technological uncertainty and limited number of alternative organizational models fosters mimetic isomorphism.
  • Professionalisation and well established structures foster normative isomorphism.
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Transaction Cost Economics https://research.alexanderchekanov.com/2012/12/11/transaction-cost-economics/?utm_source=rss&utm_medium=rss&utm_campaign=transaction-cost-economics https://research.alexanderchekanov.com/2012/12/11/transaction-cost-economics/#respond Tue, 11 Dec 2012 22:20:44 +0000 http://www.iwpro21.com/blog/?p=178 Transaction Cost Economics aims to explain why certain transactions are done within an organizations rather than on an open market and this fundamental question had been already raised in “The nature of the firm” by Coase (1937). Ronald Coase argued that organizations attempt to minimize transaction costs as these costs can be costly because of the cost of information search, bargaining, etc.
So Williamson subsequently stated the purpose of transaction economics in a more general form, referring to its objective as to “analyze the efficiency of different forms of governance using transaction as the basic unit of analysis” (Williamson 1985). Transaction Cost Economics came against such influential theories regarding the rise of large organizations as the Market Power Theory, that claimed that as an organization grows it is able to exert greater control over a market, so the Market Power provided an explanation for the organizational growth.
Nevertheless, Williamson provided an alternative explanation: the market failure. In a perfect market the transaction costs are null, so the organizations exist and grow because of the transaction costs.

Main variables in transaction cost economics

  • Frequency: If a particular transaction occurs very infrequently in an organization, the cost of maintain the necessary resources in-house are too high.
  • Uncertainty: If there is a high level of uncertainty, some events may occur that can hurt one of the two counter-party.
  • Asset specificity: If the assets involved in a particular transaction are specific to the transaction, the two parties are linked.

Nevertheless, some of the limitations of the Transaction Cost Economics are:

  • Behavioral Assumption on profit maximizing
  • Differentiating between Transaction Cost and Production Cost is often difficult
  • Reputation and Trust are not considered.
  • Transactions are assumed to be independent.

With this brief overview it is possible to have a better understanding of the roots of the Transaction Cost Economics.

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Transactional and Transformational Leadership https://research.alexanderchekanov.com/2012/12/10/transactional-and-transformational-leadership/?utm_source=rss&utm_medium=rss&utm_campaign=transactional-and-transformational-leadership https://research.alexanderchekanov.com/2012/12/10/transactional-and-transformational-leadership/#respond Sun, 09 Dec 2012 23:46:21 +0000 http://www.iwpro21.com/blog/?p=155 To understanding the meaning of “leadership” we can define it as the ability to influence a group toward the achievement of a vision or a set of goals. All managers lead but not all leaders are managers and there are different theories that attempt to explain leadership, but those that receive more attention are those that refer to the transactional and transformational leadership.

What traits and behavior characterize leaders?

Extroversion, conscientiousness, and openness to experience are some of the personal traits that are positively correlated with followers’ leadership perceptions, while there is also some evidence of a positive relationship between leadership and emotional intelligence. We can also refer to some personal traits, like core-self evaluations, to find from there a connection to both, transactional and transformational leadership.
Regarding the way the leaders tend to behave, we can differentiate them by those who have task orientation or are transactional leaders, and those who have a relationship orientation or consideration or are transformational leaders. A recent review of 160 studies done by scholars found that followers of leaders that are high in consideration (transformational leaders) were more satisfied with their jobs, were more motivated, and had more respect for their leader. On the other hand, transactional leaders were more connected with productivity of their followers.

Task oriented, transactional leader

If a leader is high in terms of task orientation, he will tend to define results that must be achieved (objectives), organize tasks (who will do what), give precise instructions (what must be done and how to do it), follow up on the work that is being done and provide feedback, and intervene when there are problems while showing how to face them.

Relationship oriented, transformational leader

A leader who has relationship orientation will tend to explain why something needs to be done, show interest in employees’ opinions, incentivize that employees take responsibility of their own work by encouraging them to make their own decisions, encourage employees to assess their performance and think of ways to improve, support and “cheer up” employees, give praise when the job is well done, and show interest in employees’ welfare.

Situational leadership theory

According to Hersey and Blanchard, the right type of leadership will depend on the person or group being led.

  • If the person/group does not know, and not willing –> Coaching leadership.
  • If the person/group does not know, but is willing –> Directive leadership.
  • If the person/group knows, but is not willing –> Supportive leadership.
  • If the person/group knows, and is willing –> Delegating leadership.

Authoritarian decision making

Authoritarian decision making appears in those situations when there is urgency and the decision must be made immediately, there is a high degree of uncertainty (lack of experience or ability) and the employees are confused, there is a lack of willingness  or interest on behalf of employees in taking more responsibility for the decision, or there is likely to be a conflict among team members for determining what solution is the best one.

Participative decision making

Participative decision making tends to appear in those situations when the employees accept or share the objective that needs to be achieved, the decision quality is key and employees have the needed experience or knowledge to make the best decision, or when it is very important that employees accept the decision and it is unlikely that they do if they do not intervene in the decision making process.

Transactional leadership

The main traits of the transactional type of leadership, apart from being task oriented, is that transactional leaders are those that guide or motivate their followers in the direction of established goals by clarifying role and task requirements, recognize needs and wants, and see how they will be satisfied. This type of leadership is based on the exchange and mutual benefit and is aimed at improving the efficacy and efficiency of the organization or business unit, while the vision tends to be taken-for-granted.
Transactional leadership is also directed towards contingent rewards through contracts that exchange rewards for effort, promise rewards for good performance and recognize accomplishments. The management by exception can be “active“, when the leader proactively watches and searches for deviations from rules and standards and takes correct action, or “passive“, when the leader intervenes only if standards are not met. Overall, transactional leadership can also be characterized by a “laissez-faire” approach.

Transformational leadership

A transformational style of leadership tend to support the qualitative change of the organization or business unit. The transformational leadership also tends to be based on commitment through intrinsic motives, tend to inspire followers to transcend their own self-interests and is capable of having a profound and extraordinary effect on followers.
Transformational leaders rely on inspirational motivation, idealized influence, individual consideration and intellectual stimulation.
Transformational leaders tend to motivate us to do more than we originally expected by raising our level of consciousness about the importance and value of designated outcomes, by getting us transcend our own self-interests, and by getting at higher order needs beyond security or affiliation, such as recognition, self-esteem, and self-actualization. Transformation leaders also tend to exert idealized influence by providing a role model for high ethical behavior, instilling pride, and gaining respect and trust. Transformational leaders also exert inspirational motivation by articulating a vision that is inspiring for the followers, communicating high expectations, using symbols to focus efforts, and expressing important purposes in simple ways. Transformational leaders also offer individualized consideration as they stop treating all subordinates alike, set examples and assign tasks on an individual basis to followers to help significantly improve their abilities and motivations and act as coach and advisor while keeping their team members always “in the loop”.
In terms of ethics, transformational leaders are more likely to emerge in times of crisis and uncertainty. Given that transformational leaders can provide followers with a vision for the future, transformational leaders also tend to be moral leaders. Nevertheless, transformational leaders can be immoral when they provide visions not backed by reality, which create false hopes and expectations on followers.

Intellectual stimulation in transactional and transformational leadership

The transformational leader may be less willing to accept the status quo and more likely to seek new ways of doing things while taking maximum advantage of opportunities. On the other hand, transactional leaders will focus on what can clearly work, will keep time constraints in mind, and will do what seems to be most efficient and free of risk. Overall, transformational leaders are more proactive, more creative, innovative, and less inhibited in their search for solutions, while transactional leaders although being equally bright, will rather focus on how best to keep running the system for which they are responsible.

Conclusion

Transactional and transformational leadership styles are hard to isolate from each other as they tend to be present at least in some degree in any leader. It is neither possible to judge what type of leadership is better because that will depend on the characteristics and circumstances of each organization, the type of “followers” and the goals of the organization. Nevertheless, understanding transactional and transformational leadership allows us to be more aware of our own behavior and guides us with some hints towards the right type of leadership depending on what challenge we have to face.

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Work teams and group dynamics https://research.alexanderchekanov.com/2012/12/09/work-team-and-group-dynamics/?utm_source=rss&utm_medium=rss&utm_campaign=work-team-and-group-dynamics https://research.alexanderchekanov.com/2012/12/09/work-team-and-group-dynamics/#respond Sun, 09 Dec 2012 18:13:49 +0000 http://www.iwpro21.com/blog/?p=142 Work teams and group dynamics is a very broad topic, but we will narrow our review to some of the most relevant questions about it: Why is it relevant to study work teams? What are the main group development stages? What is group structure and how does it influence group effectiveness? What are the advantages and disadvantages of group decision making? What is the difference between a work team and a group? What characteristics must a work team have to be effective? If at some point you ever thought about this questions, then by the end of this review you will be in a position to answer some of them with some more confidence and knowledge.

Why studying work teams?

If despite of your experience you are still feeling not sure about this question, here we drop some reasons: 80% of Fortune 500 firms have half or more of their employees working in teams; teams are flexible and can be created and dismantled; teams can be cross-functional and cross-hierarchical, and when they are “true teams”, they can be very motivating for the employees. Teams are also specially indicated for those tasks that are complex and require inter-dependence of different members. We should also notice that individual behavior within groups (and also in teams) is affected by the properties of the group itself (e.g. size) as well as the behavior of other group members.

Stages in group development

When talking about the different stages in group development, we can talk about the forming, storming, norming and performing stages. The first stage, forming, takes place when there is uncertainty concerning the purpose, structure, and leadership in the group and the members of the group get to know each other and clarify expectations. The second stage, storming, takes place when due to an intragroup conflict, some members accept the existence of the group but they resist the constraints the group imposes. There’s conflict over who will control the group and this stage is complete when the group agrees to a hierarchy of leadership. The third stage, norming, takes place when close relationships develop within the group, building higher group cohesion and formal and informal group norms are established. Finally, the fourth stage, performing, takes place when group members can focus on getting the job done and all their energy is concentrated on performing.

The case of temporary groups with deadlines (punctuated equilibrium model)

This model elaborates a bit more on the internal processes that happen within a group that can be working towards meeting certain deadlines for their deliverables. During this process we can distinguish usually the first meeting that sets the direction of the group. This first meeting is crucial because during this meeting the implicit beliefs on the group purpose, the level of effort to be expected, the leadership of the group and other important factors tend to appear. These first assumptions tend to remain stable until half-way before the official deadline. Then,— at half-way members realize “how they are performing” and start benchmarking the environment to see how others are doing and what are the external requirements. During this transition period teams can challenge previous assumptions and re-organize. After this, the inertia starts again until the last meeting before delivering, which can take long and requires great effort. At this point, depending on how the transition was done, the group can experience great cohesion or conflict.

As some of the most crucial features of group structure we can name the roles of the members inside of the group, the norms, the size of the group, its composition and group’s cohesion. We will see them more in detail next:

1. Work team roles

work team roles

(Belbin, R. Meredith, 1996)

2. Work team norms

—These are shared expectations about how group members should behave. Some examples that are common in most groups are such as scheduling norms, attendance, decision making norms, new members’ acceptance, ways to deal with conflict, work intensity, etc. This norms can develop externally to the group,— by intragroup negotiation or discussion, or spontaneously from experience. This process reminds us about the punctuated equilibrium model and about the relevance of the first meetings, where the first norms are settled.

3. Work team size

In general, larger groups are less effective as there are issues with coordination, as well as there is more possibility for social loafing. Moreover, members in large groups usually tend to be less satisfied and motivated.

4. Work team composition

—It is still not clearly determined what is the relationship between diversity in a group in terms of attitudes, gender, personality or experience regarding team performance. Nevertheless, more diverse groups usually tend to have more difficulties in the begining, although in case they manage to work together, they can reach higher levels of performance than less heterogeneous groups. It is also important to think about the type of task that is being carried out as diverse groups tend to work better with more complex and creative tasks.

5. Work team cohesiveness

Work team cohesiveness can be understood in terms of the degree to which group members are attracted to each other and are motivated to stay in the group. In cohesive groups members usually tend to interact more with each other, talk more about themselves, and create their own language codes. The relationship between cohesion and group effectiveness depends on the performance norms that exist within the group. High levels of cohesion can be useful at the beginning of the group life, or during periods of high pressure. However, if new members do not enter the group, excessive familiarity can end up leading to lack of flexibility and less group effectiveness.

In order to increase group cohesion, we can reduce the size of the group, try to agree on group goals, spend more time together, stimulate competition with other groups, make group entrance difficult for members, isolate the group or compensate the group rather than individuals.

Group decision making

Some of the advantages of group decision making are that the group tend to have access to more complete information and knowledge to make the decision. The group also tends the have more diversity of views and creativity and a greater acceptance of the decisions taken.

In terms of disadvantages the main ones are that group decision making takes more time, tends to have ambiguous responsibility and can be under conformity pressures. The discussion can be dominated by few members and although decisions are usually more accurate than the decisions of the average individual in a group, they are still less accurate than the judgments of the most accurate.

Nevertheless, if creativity is important, groups tend to be more effective, however, as groups usually take more time to make decisions, they still can be less efficient.

Work team conformity pressures

In situations of uncertainty, the group always puts pressure on us to conform. These pressures affect us more when we really care about our group membership. To learn more about it and get a better picture based on field research, check Asch experiments that showed the real impact of work team conformity pressures.

Groupthink in a work team and its symptoms

—Groupthink is known as the phenomenon that occurs when the norm for consensus in a group overrides the realistic appraisal of alternative courses of action. The illusions of invulnerability can create excessive optimism and encourage risk taking. Also stereotyping can take place against those who are opposed to the group and start being considered as weak, evil, biased, spiteful, impotent, or stupid. Direct pressure to conform can be placed on any member who questions the group, being the member couched in terms of “disloyalty”.— Also self-censorship can happen for those ideas that deviate from the apparent group consensus, and finally, illusions of unanimity can appear among group members, viewing silence as a sign of agreement.

What factors can increase the likelihood of groupthink?

—To name few of them – group cohesion, depending on how much the members are attracted to the group as well as willing to continue their membership. Faults in the group structure observed through a lack of tradition of impartial leadership, lack of norms requiring methodological procedures or homogeneity of members’ social background and ideology. Finally, a provocative situational context that can be observed through the insulation of the group, high stress from external threats, recent failures, excessive difficulties on the decision-making task or moral dilemmas.

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