‘Idiosyncrasy credits’ valuable teaching tool on leadership, November 3, 2006, 9C.

Go open a checking account at a local bank or credit union and you will be required to make an opening deposit before you can begin to use the account.  Over time, money can be deposited into the account and money withdrawn for a variety of purposes.  As the amount of money in the account increases, the account owner can make larger withdrawals.  Large withdrawals require correspondingly large deposits to replenish and maintain a healthy account balance.  The trick to maintaining a healthy balance is to deposit more than you withdraw and to have enough reserve money in the account to cover unforeseen expenses.  When an account balance drops too far below the required minimum balance, the account might be closed and the relationship between the customer and bank terminated.

Organizational researcher Edwin Hollander identified leadership concepts that are analogous to the principles of banking and account management.  Hollander described that individuals bank “influence” credits in the minds of their followers and workers.  The more of these “Idiosyncrasy Credits” that leaders have in their accounts, the more influence they have over followers.  When account balances drop too low, leaders lose their abilities to influence and to bring about change in their followers.

Idiosyncrasy credits are earned through demonstrated competence and shared values.  Because leadership is an attribution process, whereby individuals are deemed to be leaders in the minds of their followers, the amounts of idiosyncrasy credits available to leaders might differ across individual followers.  Successful and positive experiences between followers and leaders result in “deposits” to the leader’s power and influence account.  When leaders become associated with organizational failures and mishaps or when they act too far outside the bounds of acceptable group behavior, their power and influence balances are reduced.

New organizational leaders typically bring with them an “opening balance” of idiosyncrasy credits from previous experiences or through their formal organizational titles.  Over time, through their interactions with followers, leaders can gain or lose credits.  Leaders of all types, but especially new leaders, should carefully build idiosyncrasy credits with their followers by demonstrating appropriate group behaviors and proving competence to their followers through gradual change and success.  It is important that leaders carefully choose the issues they are willing to challenge so that they build a record of success—and thereby continually add to their account balances.

Charismatic leaders and agents of radical organizational change are the high rollers of power and influence.  Leaders who present visions that differ substantially from the status quo or demand radical changes in organizations risk losing all of their idiosyncrasy credits if they are rejected or fail.  When those leaders succeed, however, they are bestowed with tremendous amounts of power and influence from followers and organizational members—which allow them to suggest and bring about more change.  Cult leaders and charismatic leaders exert considerable influence over their followers because they are perceived as owning extraordinary amounts of power and influence.  When those leaders fail, however, their power balances quickly diminish and they may eventually be asked to leave the organization.

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