The Five Practices of Exemplary Leadership
The Five Practices of Exemplary Leadership
Positively Impacts Constituents and Their Organizations
Special Report
September 2007
Evidence-Based Leadership Model
Two recent research reports offer strong empirical support for the impact of The Five Practices of Exemplary Leadership model (Kouzes & Posner, 2007). Together they show that the more we can get leaders in our organizations, at all levels, to Model the Way, Inspire a Shared Vision, Challenge the Process, Enable Others to Act, and Encourage the Heart, the better off will companies and their constituents be.
Leadership Favorably Impacts Constituent (Employee) Attitudes
When the people leading engage in The Five Practices of Exemplary Leadership their constituents report significantly high levels of important employee attitudes. This is the consistent conclusion of a recent analysis involving over 66,000 survey responses completed over the past two years.
The more frequently respondents reported their leaders, across a variety of organizations, fields, and functions:
• Modeling the Way
• Inspiring a Shared Vision
• Challenging the Process
• Enabling Others to Act
• Encouraging the Heart
the more these same constituents reported experiencing:
• Pride in their workplaces
• Strong motivation (willingess to work hard and long hours)
• Team spirit
• Being productive
• Trusting management
• Clarity about their responsibilities
Indeed, intentions to remain with their organizations over the next year were directly related to the leadership practices of their leaders. People reported that they felt personally effective in their oganizations; they felt valued and believed they were making a difference in direct proportion to the extent they experienced their leaders engaging in The Five Practices of Exemplary Leadership.
These findings are from an on-going meta-analysis of data gathered from the online administration of the Leadership Practices Inventory (LPI). Leaders asked their constituents to identify the extent that they (leaders) engaged in the thirty (30) behaviors which make up the The Five Practices. These same constituents are invited to indicate (anonymously) the extent to which they agree (or disagree) with ten (10) statements assessing particular employee attitudes and behaviors. Generally, each leader has responses from an average of ten (10) constituents. Table 1 shows these statements, along with their means and standard deviations.
Table 1
Means and Standard Deviations for Employee Sentiment Scale
(N = 66,395; Observers only)
Item Mean Standard Deviation
Team Spirit 3.92 .961
Organizational Pride 4.31 .813
Commitment to Stay 4.17 .970
Work Motivation 3.93 .969
Productivity 4.15 .740
Clarity of Expectations 4.09 .857
Feeling Valued 3.82 .960
Personally Effective 4.18 .666
Trust in Management 3.45 1.05
Empowered 3.96 .852
The ten employee attitude measures were combined to create an Employee Sentiment scale. Internal reliability (Cronbach alpha) for the scale was very good (.83). Taking the entire constituent sample and splitting it at the mean on this scale produced an above average and below average group. T-test comparisons between the two groups showed consistent statistically significant differences (p < .001) on all five practices. The Employee Sentiment scale was consistently higher for the Above Average group of respondents than it was for the Below Average group (see Table 2) based upon the leadership practices of their leaders. This was true across all five of the leadership practices.
Table 2
Comparisons Between Below and Above Average
Leaders on Employee Sentiment Scale by Leadership Practice
Leadership Practice Below-Average Above-Average
Model the Way 44.08 49.84
Inspire a Shared Vision 40.66 47.19
Challenge the Process 42.07 47.78
Enable Others to Act 47.18 52.01
Encourage the Heart 42.90 49.29
These differences remain consistent when the sample is divided into three similarly-sized groups, representing low, moderate and high groups on the Employee Sentiment scale. As shown in Table 3, constituents in the low group report their leaders engaging in all five leadership practices significantly less than those in the moderate group; and, in turn, employees in the moderate group report their leaders engaging in these five leadership practices significantly less than those constituents in the high Employee Sentiment group. Analysis of variance results were all statistically significant (p < .001) and post-hoc analysis revealed statistically significant differences between all three groups.
Table 3
Comparisons Between Low, Moderate and High Leaders
on Employee Sentiment Scale by Leadership Practice
Leadership Practice Low Moderate High
Model the Way 42.98 47.19 50.74
Inspire a Shared Vision 39.43 44.16 48.22
Challenge the Process 41.00 45.12 48.68
Enable Others to Act 46.22 49.86 52.73
Encourage the Heart 41.70 46.30 50.30
Furthermore, regression analysis, with Employee Sentiment as the dependent variable, demonstrated that the five leadership practices (or the Five Practices of Exemplary Leadership model) explained a statistically significant portion of the variance (R2 = .178, p < .001). That is, nearly 19 percent of constituent’s feelings about their workplaces, motivation, commitment and pride can be accounted for by how often they perceived their leaders engaging the in behaviors associated with The Practices of Exemplary Leadership model.
While the previous analysis is at the individual level, consider what impact leadership has on organizational performance. This matter is taken up in the next section.
Leadership Impacts Return on Investment
In a survey involving 94 companies, Richard Roi (2006) asked executives to rate their company’s senior leadership on The Five Practices of Exemplary Leadership by completing the Leadership Practices Inventory (LPI). Then he analyzed the company’s long-term financial performance (over a 10-year period; 1996 – 2005) using net income and stock price growth. The relationship between transformational leadership practices (combining all five leadership practices into a single measure) and company financial performance was dramatic (see Table 4).
Table 4
Relationship Between Transformational Leadership Practices
and Financial Performance
Financial Performance Transformational Leadership Practices
Strong Weak
Net Income Growth 841% -49%
Stock Price Growth 204% 76%
Strong
Companies with a strong and consistent application of these five leadership practices had net income growth of 841 percent versus -49 percent for companies with a low incident of leadership practices. Similarly, stock price growth was 204 percent for strong leadership practices companies compared with only 76 percent for companies with a weak implementation of leadership practices.
Conclusion: The Five Practices of Exemplary Leadership Make a Difference
The evidence is strong, clear and consistent: The Five Practices of Exemplary Leadership make a significant difference in both favorable employee sentiments and positive company financial performance. Hundreds of other empirical studies, across a wide variety of industries and settings, support these conclusions (see: research).
If you are interested in being a better leader yourself, or your organization wants to build better leaders, then make certain you find out about The Five Practices of Exemplary Leadership. For the past 25 years this framework has been used to develop leaders and today is one of the most trusted sources for leadership development around the globe.
References:
James M. Kouzes and Posner, Barry Z. 2007. The Leadership Challenge, 4th Edition (San Francisco, CA: Jossey-Bass).
Richard C. Roi. 2006. Leadership, Corporate Culture and Financial Performance. Unpublished doctoral dissertation, University of San Francisco.
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