From the November 1996 issue of Entrepreneur

When David "WhiteThunder" Trottier wanted to drum up in-line skaters' interest in a new skate wheel he planned to distribute, he dropped by the place skaters go near his St. Michael, North Dakota, three-employee company, WhiteThunder Inc. He didn't bring any wheels to show the four skaters he found there. Instead, he brought a supply of skater jargon and a tantalizing offer.

"I asked them, `Do you grind? Do you do any half-pipes?' " Trottier says. "The kids looked at me and asked, `How do you know all this?' I just said I wanted to give a kid a set of wheels to test for me. The next night I came back, and there were 20 kids waiting to see the wheel."

Trottier's interest-building ploy is a tactic of situational leadership, a model of leading that says there is no one right way to influence people. Rather, there are several ways, any one of which may be appropriate depending on the level of readiness and the ability of the people who are to be led.

Although it sounds simple or even obvious, situational leadership has been taught to millions of managers worldwide. The source of situational leadership's popularity is its effectiveness and ease of application, says Dewey Johnson, a professor of management at California State University, Fresno.

"The reason it works is that it puts the focus on the follower," explains Johnson. "You find out where the follower is as far as ability and willingness. Then, based on where the follower is in relationship to the objective, you see the right leadership style that goes along with it. The concept is elegant in its simplicity."

Situational Start

The situational leadership model was developed in the 1960s by an Ohio State University management professor named Paul Hersey. His research into the psychology of leadership was published in 1969 in Management of Organizational Behavior (Prentice Hall), a textbook that has sold more than 1 million copies and is in its seventh edition. Hersey later founded the Center for Leadership Studies, a management training firm in Escondido, California, that has helped teach the model to people in small and large companies worldwide.

The situational leadership model assumes that the biggest mistake most managers make is using the same leadership style with everyone. For instance, leaders may delegate too much authority to an employee who isn't ready or able to handle it. Or, they may micromanage an employee who would perform better if left alone.

Situational leadership promises to help managers figure out where their followers are, then match their leadership styles to the appropriate level. "Situational leadership introduces a diagnostic process to leadership," says Johnson, who, along with Hersey and management guru Ken Blanchard, co-wrote Management of Organizational Behavior. "That is a big plus."

The situational leadership model divides followers into four readiness levels, based on their willingness and ability. The levels range from R1 (the lowest) to R4 (the person who is most ready, willing and able to handle the task at hand).

Determining readiness levels can be tricky. Leaders may need to take into account a variety of factors, from the time available to complete a task to the organization's history and tradition. Hersey's model provides specific tools to help in the diagnosis as well as to evaluate and correct diagnostic errors.

"When you go through your diagnosis of the individual, sometimes you're going to miss," says Jim Bone, president of The Training Connection Inc., an Irving, Texas, company that offers training in situational leadership. "But when you miss, you're going to get some very predictable human reactions that will tell you where you went wrong."

Hersey also offers a chest of tools for increasing employees' readiness, including, for instance, offers of more money.

Once the correct readiness level is identified, the leader has to choose from four leadership styles. The leadership styles range from S1 through S4, with S1 being the most directive and S4 being the style where managers turn over the greatest responsibility to followers.

Trottier's informal market research on in-line skate wheels was designed to match the readiness levels of his intended customers. Other test marketers might have merely handed out sample wheels or marketing materials with no explanation, but the situational model said that the personal approach was a better way to go in this case.

"In [rural areas], particularly where we were going to start selling the wheel, the readiness of people when it comes to [new trends in] in-line skating is very low," Trottier explains. "So we've had to apply the style level to the readiness level to determine what we tell them about the wheel."

Situational Circumstances

Situational leadership works well whether you're a corporate executive or a start-up entrepreneur, according to Ron Campbell, president of the Center for Leadership Studies. "[In our seminars,] we'll get the guy who's a manager at Big O Tires down the road or a printing shop with 10 people, and we'll have that person sit side by side with the VP of human resources at a Fortune 500 company," says Campbell.

The situational model works best when dealing with employees who don't already have their minds made up to be uncooperative, Campbell says. Bone feels situational leadership is most useful when it comes to new employees. "That's where you get the opportunity to exercise all the different styles the most," he says. "With employees you've worked with for 10 years, most of the time you're using a style of just delegating."

Situational leadership isn't the optimal tool for all occasions, either. It functions well, for instance, in businesses where people are the key ingredients. It's less effective and appropriate in situations where the driving factors are processes or technology. "In an oil refinery, you can't decide that one day you want to turn off this pipe and turn on another one," says Johnson. "There's a process you have to follow."

Situational leadership may also be inappropriate in organizations that have deeper underlying problems. Campbell says the center discourages firms whose practices and policies hinder leadership from using its programs. "You're not going to teach leadership skills that nullify the effect of dumb management," he says.

Even under the best circumstances, you can go wrong trying to follow the situational model. The main risk is making an incorrect diagnosis of the follower's readiness level. This typically happens when a leader tries to move too quickly or on the basis of insufficient or incorrect information.

Most risks can be avoided by keeping to the model's focus on followers more than leaders, says Campbell. "Don't worry about the leader's behavior as much as diagnosing where the follower is," he advises. "Be follower-driven."

Entrepreneurs who want to learn more about situational leadership have a rich array of books, videos, audiotapes, seminars and even an interactive CD-ROM from which to choose. Perhaps because it is so widespread, situational training is inexpensive compared to many other leadership programs. A two-day seminar at Campbell's center costs $595. Many colleges and other training sources offer courses for $100 a day or less.

Situational leaders themselves say taking a training course is a good educational value, with broad applications in many areas of life. "What situational leadership does for you is make you assess all situations better, not only in your role as a leader, manager and supervisor," says Trottier, "but as a human being."

Mark Henricks is an Austin, Texas, writer who specializes in small-business topics.