50 Copyright © 2013, IGI Global. Copying or distributing in print or electronic forms without written permission of IGI Global is prohibited. Chapter 6 Nazmi Çeşmeci Piri Reis University, Turkey Süleyman Özkaynak Piri Reis University, Turkey Deniz Ünsalan Piri Reis University, Turkey The Effect of Crises on Leadership ABSTRACT Crises can be regarded as the nursery of leadership in a way. They have both created new leaders and have also proved to be a testing ground for the existing leaders, as well as a flter where the inefcient have been eliminated. Man-made crises have been classifed as social, economical, and political crises up to recent times. With the development of modern markets, new fnancial tools have emerged. Those fnancial tools have the function of regulating the modern economy, but also they have the handicap of propagating their own crises from the economic feld to social and political areas. In this context, crises give way to radical changes in the management paradigm. In such an environment, the leadership virtues of the previous paradigm period turn out to be insufcient. Institutions used to survive during the crisis periods by employing their crisis management plans. However, crises gain a permanent nature during the modern times and tactical crisis management becomes insufcient in the new environment. The phenomenon of permanent crisis forces leadership to have some special virtues. Therefore, it be- comes necessary to defne a new type of leadership, namely “strategic crisis leadership.” The aim of this chapter is to examine the impact of crises on leadership virtues and express refections on the new type of leadership in the new paradigmal period. DOI: 10.4018/978-1-4666-3006-2.ch006