ACCA Strategic Professional · Strategic Business Leader · Qualities of leadership
Orion Biotech's founder, Lena, is widely admired for her personal magnetism. Staff follow her instructions without question and the board rarely challenges her. She is now proposing a risky acquisition with little analysis. Which is the most significant risk of the charismatic leadership shown here?
The main risk is over-dependence on one individual combined with weak challenge. Because followers and the board defer to Lena's personal magnetism, risky decisions such as the acquisition may go unscrutinised, and the organisation may struggle if she leaves. Charismatic leaders usually communicate vision well, so that is not the problem.
- AStaff will become demotivated because rewards are linked strictly to targets
- BOver-dependence on one individual and weak challenge, creating succession and poor decision risksCorrect
- CThe leader will be unable to communicate a vision to followers
- DFollowers will focus on routine tasks and resist any change
Explanation
Charismatic leadership creates strong dependence on the leader, and followers may not question decisions, which risks poor judgement and succession problems. The motivation-by-targets option describes a transactional issue. Charismatic leaders are usually good at communicating vision, and followers are typically willing to change.
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