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Facts of the Case

Martin Quinn, SVP for service and operations for Health Insurance Company is
looking for opportunity to control costs of labor intensive department.
Evelyn Gustafson, retired customer service representative. Knows how to handle
their staffs. During Gustafsons time turnover rate is at 10% but she resisted
attempts to increase efficiency and lower costs in the department were salaries
accounted for almost 70% of the budget.
Erik Rasmussen, newly hired and In-charge to minimize cost and eager to bring
change to the company. Develop standard measure performance automated
work schedules for the company. Rasmussen focus is more on performance of
the department in terms of cost which he achieved to lower but the morale and
the turnover rate is at 30% and there are more complaints from their

Questions and Analysis

1. How would you describe Evelyn Gustafsons leadership style? What
were its strengths and weaknesses? What were the sources of her
The leadership style of Evelyn is high important to people and low attention
to cost. Shes more concern to the emotions and needs of her team since she
believes that as long as her teams members are satisfied and happy then
they will work hard and what tends to result is a working environment that is
very relaxed but the production side suffers due to lack of control and
The strength for this kind of leadership style, there is a good interpersonal
relationship between the leader and follower since the leader considers the
needs of her team and motivates them, it creates a conducive working
environment while working on a task. The weakness on this is that since the
leader is more focus on her employee it hinders to control the cost which for
this case resulted to bigger budget for employees salaries.
I think the sources of her influence is from her power to give a reward as their
head. Managers have the access to formal rewards such as promotions and
salary increase. They also have at their disposal such rewards as praise,
attention and recognition which sometimes more powerful than a salary
increase and can influence the behavior of her team. People in general would
rather say yes to someone they like than to someone they dont and by

treating them fairly and with trust, most likely they will support you by doing
your assigned task.

2. How would you describe Erik Rasmussens leadership style as he

tried to eect change? What are its strengths and weaknesses?
What are the sources of his inuence?
Erik is more of Authoritarian leadership style since he believes the employees
are just secondary to the need for efficient and productive working
environment. He believes that rules and procedures are effective ways to
motivate employees
The strength for this kind of leadership is that it emphasize on organizational
efficiency and guided by concrete objectives when deciding on how to
accomplish the task while the weakness for this style is that there is lack of
evaluation of internal culture and the approach is not participatory on how
they will bring change to the organization.
I think the sources of his influence is the power given to him as part of
management, with the authority he can get things done by just giving the
task to his team. Also the reward and punishment is another means for him
to influence his people.
3. If you were Martin Quinn, would you recommend modications in
Erik Rasmussens leadership style that you would like him to adopt?
Do you think it will be possible for Rasmussen to make the necessary
changes? If not, why not? If you do think change is possible, how
would you recommend the desired changes be facilitated?
If I were Martin Quinn, I would suggest that he should analyze the internal
situation first by connecting and talking to employees, he needs to build
relationship to show that he care and considers them. I will say that he needs
to establish mutual interest by forgetting first on how to achieve production
efficiency instead be sensitive to his team and listen and respect their ideas
and I believe when he already gain their trust, production efficiency can be
easily achieve since everyone supports the idea.
I think change is really necessary because there should be balance for people
and task to have a good and efficient working environment. Afterall, I believe
that the most effective leader should develop on how to interact and how to
build relationship to everyone.