What is Hersey-Blanchard Model?

2498 reads · Last updated: December 5, 2024

The Situational Leadership Model or Theory, also known as the Hersey-Blanchard Model, suggests that no single leadership style is better than another. Instead of focusing on workplace factors, the model suggests that leaders should adjust their techniques to those they lead and their abilities.Under the model, successful leadership is both task-relevant and relationship-relevant. It is an adaptive, flexible style in which leaders are encouraged to consider their followers—individuals or a team—then consider the factors that impact the work environment before choosing how they will lead. This gives them a better chance of meeting their goals.

Definition

The Hersey-Blanchard Model, also known as the Situational Leadership Model, is a theory that suggests no single leadership style is superior to others. It advises leaders to adapt their leadership techniques based on the followers and their abilities, rather than focusing solely on workplace factors.

Origin

The Hersey-Blanchard Model was developed by Paul Hersey and Ken Blanchard in the 1970s. Initially, this theory was designed to help managers better understand how to adjust their leadership styles according to the varying needs and abilities of their team members.

Categories and Features

The model categorizes leadership styles into four types: directing, coaching, supporting, and delegating. The directing style is suitable for employees with low competence but high willingness; the coaching style fits those with moderate competence and willingness; the supporting style is for those with high competence but low willingness; and the delegating style is for employees with both high competence and willingness. This classification helps leaders choose the most appropriate style based on specific situations.

Case Studies

At Apple, Steve Jobs was known for his flexible leadership style. He adopted a more directive style during the development of the iPhone, while he leaned towards a delegating style for other mature product developments. Another example is Sundar Pichai at Google, who often adjusts his leadership style based on the capabilities of his team members and project needs, thereby enhancing team efficiency and innovation.

Common Issues

Investors applying the Hersey-Blanchard Model often misunderstand that leadership styles are fixed, overlooking the importance of adjusting styles according to changes in team members. Additionally, over-reliance on a single style can limit the development of team members' abilities.

Suggested for You

Acceleration Clause

An acceleration clause is a contract provision that allows a lender to require a borrower to repay all of an outstanding loan if certain requirements are not met. An acceleration clause outlines the reasons that the lender can demand loan repayment and the repayment required.It is also known as an "acceleration covenant."

Weighted Average

A weighted average is a calculation that takes into account the varying degrees of importance of the numbers in a data set. In calculating a weighted average, each number in the data set is multiplied by a predetermined weight before the final calculation is made. A weighted average can be more accurate than a simple average in which all numbers in a data set are assigned an identical weight.

Day-Count Convention

The Day-Count Convention is a standardized method used in financial markets to calculate interest. It defines how days should be counted when computing interest, with different conventions applicable to various financial instruments and markets. Common day-count conventions include Actual/Actual, Actual/360, Actual/365, 30/360, and 30/365, among others. For instance, the Actual/Actual convention calculates interest based on the actual number of days and the actual number of days in the year, while the 30/360 convention assumes each month has 30 days and each year has 360 days. The choice of day-count convention affects the interest calculation for bonds, loans, and other financial instruments, making it crucial to specify the convention in financial contracts.

Crowding Out Effect

The Crowding Out Effect refers to an economic phenomenon where increased government spending or borrowing leads to a reduction in private sector investment. When the government raises funds by issuing bonds or increasing taxes, it often results in higher market interest rates, thereby increasing the cost of borrowing for businesses and individuals. In such a scenario, private companies may reduce their investments because borrowing becomes more expensive. Additionally, substantial government spending can absorb available resources and funds in the market, leaving fewer resources and funds for the private sector, further inhibiting its investment activities. The crowding out effect is commonly observed during periods of expansionary fiscal policy, especially when the economy is near or at full employment. Understanding the crowding out effect helps policymakers balance government spending and economic growth.

Pooled Funds

Pooled funds are funds in a portfolio from many individual investors that are aggregated for the purposes of investment. Mutual funds, hedge funds, exchange traded funds, pension funds, and unit investment trusts are all examples of professionally managed pooled funds. Investors in pooled funds benefit from economies of scale, which allow for lower trading costs per dollar of investment, and diversification.

Giffen Good

A Giffen good is a low income, non-luxury product that defies standard economic and consumer demand theory. Demand for Giffen goods rises when the price rises and falls when the price falls. In econometrics, this results in an upward-sloping demand curve, contrary to the fundamental laws of demand which create a downward sloping demand curve. The term "Giffen goods" was coined in the late 1800s, named after noted Scottish economist, statistician, and journalist Sir Robert Giffen. The concept of Giffen goods focuses on a low income, non-luxury products that have very few close substitutes. Giffen goods can be compared to Veblen goods which similarly defy standard economic and consumer demand theory but focus on luxury goods.Examples of Giffen goods can include bread, rice, and wheat. These goods are commonly essentials with few near-dimensional substitutes at the same price levels.