IMPACT OF LEADERSHIP ON ORGANIZATIONAL PERFORMANCE How Leaders

IMPACT OF LEADERSHIP ON ORGANIZATIONAL PERFORMANCE

How Leaders Shape Culture • Attention – what do they pay attention to • Reactions to crisis – how do they react in a crisis • Role modeling • Allocations of rewards • Criteria for selection and dismissal

OHIO STATE UNIVERSITY

Commercial Airlines Crews • Foushee and Helmreich (1988)- study the performance of airlines crews, focusing on the captain’s personality. • Captains who were warm, friendly, self confident and able to deal with pressure had crews with the best performance. • Captains who were arrogant, hostile, boastful, egotistical, and passive aggressive had the worst performing crews.

INFOSYS • Started in 1981, be seven professional entrepreneurs led by Narayan • • Murthy, Chairman and CEO of Infosys. Started his career as head of the computer center at IIM-A Narayan Murthy focused on the world’s most challenging market – The U. S There was no market for software in India at that time In 1987, Infosys entered into a joint venture with Kurt Salmon Associates (KSA) KSA-INFOSYS was the first Indo-American joint venture in the U. S In 1988 -89, Infosys set up its first office in the U. S Reebok of France and developed a software system to handle its distribution management. In 1998 , Narayan Murthy listed the shares of Infosys on Nasdaq

PEOPLE MANAGEMENT AT INFOSYS § Low Employee Turnover: during 1990’s employee turnover rate at Infosys was 11% as compared to 25% in other software companies. § Reasons: Rigorous employee selection Proactive HRD practices • Facilities Provided to Employees: ticketing, credit cards, house loan, crèche facilities, gymnasium etc. • Infosys was one of the first companies to adopt an Employee Stock Option plan (ESOP), in 1997 500 employees were awarded stock under the ESOP. • Infosys was one of the best rewarding organization in the industry.

Narayan Murthy as Leader • “ My employees seek challenging opportunities, respect, dignity and the opportunities to learn new things. I keep telling them that my assets are not this building, the business or foreign contact. My assets all 8000 of themwalk out of the gate every evening and I wait for them to come back to me the next morning. ” • Our Transactions are Zero based so there is no history sheet • Employees were encouraged to communicate with each other and with the higher management about interesting ideas and ways of solving problems through the electronic bulletin boards.