Module 8

LEADERSHIP
What is Leadership?

Leadership is the process of influencing employees to accomplish organizational objectives. It is the ability of an
individual who is known as a leader to motivate others to work with confidence and zeal to attain some
predetermined goals.

Definitions of Leadership

There are some definitions of leadership by different authors which are given below:

According to Chester Bernard, leadership is the quality of behavior of the individuals whereby they guide people in
their activities in an organized effort.

According to Livingston, leadership is the ability to awaken in others the desire to follow a common objective.

According to Keith Davis, leadership is a human factor that binds a group together and motivates toward particular
goals.

According to Koontz and O’Donnell, leadership is the ability to exert interpersonal influence by means of
communication toward the achievement of goals.

According to the Encyclopedia of Social Sciences, leadership is the relation between an individual (leader) and a
group (followers) around some common interests and behaving in a manner directed or determined by the individual
(leader).

Theories of Leadership

1. Trait Theory

The trait theory of leadership underscores various personality facets associated with successful leadership in
different situations. Theoreticians researching the trait theory tried to emphasize the leadership characteristics from
various perspectives.

The trait theory of leadership shows the two most common trait theories:

1.1 Allport’s Trait Theory

The theory of Gordon Allport emphasized that the personality of an individual can be studied from the difference
between his common traits and personal characteristics.

According to Allport, the common traits of an individual are compared according to six values like being religious,
economic, political, social, theoretical and aesthetical.

The common traits of an individual are the personal characteristics that are different and can be categorized as
follows:

Cardinal traits: These are considered powerful traits and very few people have a personality that is dominated by
these traits.

Central traits: These traits are common attributes that many individuals have to different degrees. Examples of such
traits are being friendly, jovial, loyal agreeable and more.

Secondary traits: These traits project the reason why a person behaves differently at times than what is his normal
behavior. For example, a person who is generally happy can feel sad on listening to some particular news.

1.2 Cattell’s Trait Theory

Cattell’s trait theory highlights the fact that it is important to study a number of factors before understanding the
personality of an individual. He collected data with the help of a questionnaire and analyzed it with a statistical
technique, known as factor analysis, to identify various traits. Cattell came up with many traits like being warm, being
vigilant, being lively, being sensitive, being apprehensive, etc.

Cattell’s trait theory is based on the concept that every individual has traits that are common but may vary to
different degrees. These traits stay consistent over a period of time, and these can be measured through various
indicators of behavioral studies.

These give an understanding of their identity and the manner in which it will affect others working in an organization.

2. Transformational Leadership Theory

According to the transformational leadership theory, a high-performance workforce can be built when leaders are
able to inspire their followers to work beyond their job responsibilities.

A transformational leader should have the following characteristics:

 Inspirational
 Intellectual
 Idealistic

Inspirational refers to the quality of motivating employees to perform better. A transformational leader should
inculcate the feeling of teamwork among employees through his/her enthusiastic and optimistic approach.

Intellectual refers to the quality of being rational and logical. A transformational leader should be intellectual to
analyze problematic situations and give appropriate solutions.

Idealistic refers to the quality of being morally right. A transformational leader should be idealistic if he/she wants
his/her followers to be devoted and committed. He/she should not be unfair while dealing with his/her followers.

3. Behavioral Theory

The behavioral theory was developed scientifically by behavior-focused studies. This theory emphasizes certain
behaviors and actions of leaders and not on their traits or attributes.

As per this theory, leadership ability is exhibited more in the actions and behaviors rather than the personal traits of
an individual.

These skills are defined as follows:

 Technical skills refer to the individual’s knowledge of the system, processes and techniques.
 Human skills refer to the ability of the individual to be able to interact with other individuals.
 Conceptual skills refer to the ability of the leader to come up with innovative ideas for running the
organization successfully and strategic decision making.

4. Contingency Theory

The contingency theory emphasizes different factors in a specific situation that determines the style of leadership.
The contingency theory was developed by Fred E. Fiedler. According to the contingency theory, no one leadership
style is applicable in all situations.

Good leaders need to have the right qualities and they should evaluate the needs of their people according to the
situation at hand. The contingency theory suggests that great leadership is a combination of many key variables.

According to Fiedler, for understanding the contingency theory, it is necessary to know the style of the leader, which
can be identified through the ‘Least Preferred Coworker Scale (LPC). The LPC has a set of questions that are
formulated to identify the kind of employee a leader would most prefer to work with, and, in turn, this would
demonstrate the leader’s way of working.
The Fiedler’s Contingency Model tries to match the leaders’ style using LPC according to the situation in which they
would succeed. The two types of LPC scores are:

1. High LPC Score

2. Low LPC Score

High LPC Score

According to Fiedler, a leader with good personal skills depends on building relationships with others to fulfil tasks. A
high LPC score highlights that the leader is people-oriented.

Low LPC Score

As per Fiedler, a leader with a low LPC score will give priority to the task first and will focus on maintaining
relationships only if satisfactory outcomes are obtained. This exhibits that the leader is task-oriented.

Styles of Leadership

There are different styles of leadership and their impact on employees which we are going to discuss:

1. Autocratic Leadership Style

2. Democratic Leadership Style
3. Laissez-faire Leadership Style
4. Bureaucratic Leadership Style
5. Charismatic Leadership Style
6. Directive Leadership Style
7. Supportive Leadership Style
8. Situational Leadership Style

1. Autocratic Leadership Style. In the autocratic leadership style, employees are managed in an autocratic
manner and it is only the leader who likes to have the total control and power to take decisions without
involving anybody else.

In this setting, leaders do not like to ask or make suggestions and opinions from anyone. Employees normally do not
like this style of leadership.

Impact of Autocratic Leadership Style on Employees

Employees are usually repulsive to this kind of leadership style because of the following reasons:

1. It affects employee productivity and motivation.

2. There is no trust between the leaders and the employees.
3. It has a negative impact on employees.
4. Employees do not like the way decisions are made.
5. It does not have the environment for accepting the creative ideas of the employees.
6. It does not encourage the employees to take ownership of their work.
7. Employees feel insecure in their jobs in this style of leadership.

2. Democratic Leadership Style. The democratic style of leadership involves employees in the working and
decision-making processes of the organization. Leaders like to share their thoughts and concerns with the
employees and it has a major positive impact on employee motivation and productivity.

Democratic leadership style has the following major advantages:

1. It gives employees a sense of ownership in their role of working for the organization.
2. It helps enhance the morale of the employees.
3. It allows employees to feel important and involved in the daily operations of the business.
4. It allows their voices to be heard by the management.
5. It creates a positive environment for working.
 6. It allows the employees to be innovative and open to new ideas.
7. It gives a platform to the employees for discussion.

3. Laissez-faire Leadership Style. The laissez-faire leadership style has a very casual approach to leadership.
Leaders leave working on the employees and do not like to control or take on responsibilities.

Impact of Laissez-faire Leadership Style on Employees

The laissez-faire leadership style has the following advantages:

1. Employees become self-motivated and they take on the responsibility for their work.
2. Employees learn to be innovative which is accepted by the organization.
3. Employees are happy working in this environment.
4. It gives the employees flexible time to balance work and family commitments.
5. The system increases employee retention within the organization.

4. Bureaucratic Leadership Style. In the bureaucratic leadership style, leaders follow a structured way of
working. They ensure that employees also follow the set procedures. This type of leadership leaves no space
to explore new ways to solve issues because leaders prefer to work according to the preset standards. This
type of leadership is normally followed in hospitals, universities, banks and governmental organizations to
bring down corruption and increase security.

Self-motivated individuals who are highly energetic often feel frustrated in this leadership style because of the
organization’s inability to adapt to the changing environment. For example, Harold Geneen, who was the CEO of
International Telephone and Telegraph Corporation (ITT), is considered to be a bureaucratic leader and his success is
attributed to his strong focus and bureaucratic style of management.

5. Charismatic Leadership Style. In the charismatic leadership style, leaders infuse a lot of enthusiasm and
boost the energy levels of employees. They work with a goal or a mission and are visionaries who drive their
team to gear to a high level of performance. Leaders are dedicated to their organization and are a boon to
the organization. Leaders who adopt this leadership style have the ability to engage large audiences. For
example, Mahatma Gandhi, Nelson Mandela etc.

6. Directive Leadership Style. In the directive leadership style, leaders monitor and guide employees in their
work. They delegate tasks, schedule work, maintain records and increase the performance levels of the
employees. Directive style is very useful when the employees have low level of motivation or if a conflict
arises between different people. It is mostly used in organizations where there is hardly any scope of error.
For example, law enforcement, military, etc.

7. Supportive Leadership Style. In supportive leadership, leaders are friendly and approachable towards
employees. They show concern to- wards employees and help them in facing problems while performing
work. Under this leadership style, leaders listen carefully to their employees and help them deal with stress.
Leaders also train their employees to deal with conflicting issues. For example, Joe Paterno, a former
American football player is considered as a supportive leader and coach.

8. Situational Leadership Style. In the situational leadership style, leaders of the organization adjust their style
to fit the development level of their followers. This style was developed by Kenneth Blanchard and Paul
Hersey. In situational leadership, the style may change continually to meet the needs of situation in the
organization.

Characteristics of Leadership

Leaders play an important role in the growth of any organization with their leadership skills. A good leader shapes
the behavior of the people and guides them in such a manner that their followers or employees work with full
commitment for achieving the objectives of the organization.
Leadership involves motivating teams and maintaining good interpersonal relations with every individual and leading
them towards their goals.

Let us discuss the characteristics of leadership in detail:

1. Interpersonal process
2. Continuous process
3. Group process
4. Shape behavior
5. Situational based

Interpersonal process. Leadership depends upon the personal qualities of a leader. The way a leader influences the
behavior of people totally depends on the leader’s ability.

Continuous process. Leadership is a never-ending process. In an organization, the process of persuading others to do
a particular work never ends. Leadership encourages liveliness in the group by encouraging individuals to give their
level best.

Group process. Leadership cannot be performed in isolation. In the absence of followers, there is no leadership.
Leadership at least requires two or more than two persons. It is the process in which one person, i.e., leader directs
other subordinates or followers to attain the tasks assigned to them by following specific instructions.

Shape behavior. Leadership helps an organization to mold the negative behavior of employees into positive behavior.
It creates positive culture in the organization by reinforcing values.

Situational based. Leaders can use different leadership styles on the basis of situations faced by them. There are
different styles of leadership such as autocratic, participative and free-rein or Laissez-Faire styles.

Importance of Leadership

Leadership plays a significant role in channelizing the efforts of the employees in the right direction. Leaders are able
to mobilize the efforts of people by inspiring, supporting and developing enthusiasm.

The role of leadership is critical for organizational development as leaders help in creating and maintaining
interpersonal relationships with employees. The success of an organization, as well as a country, depends on the
effectiveness of leadership.

Let us understand the significance of leadership in the organizational development with the help of the following
points:

1. It helps in influencing the behavior of people

2. It enables implementation of changes
3. It resolves conflicts effectively
4. It helps in initiating action
5. It helps in training and development of the subordinates
6. It motivates people

It helps in influencing the behavior of people. Effective leadership helps in inspiring, shaping and controlling the
behavior of people through skills and capabilities. A good leader converts the negative attitude of subordinates into
positive by directing and influencing them through reward, punishment, recognition and praise.

It enables implementation of changes. The business environment keeps on changing at a rapid pace due to which an
organization needs to keep up with the changing trends. A good leader uses experience to implement changes
without much resistance from the employees’ side since leaders are able to influence them. Leaders have a positive
mindset and they move forward using their experience to guide workers through the changing environment without
feeling insecure.

It resolves conflicts effectively. Effective leadership skills help in solving conflicts between employers and employees
or employees and employees. The leader uses skills to understand the nature of the conflicts and find out possible
ways for resolving them peacefully and on time. This helps to avoid unfavorable conditions within the organization. A
good leader handles employees by listening to them carefully.

It helps in initiating action. An effective leadership enables employees to perform their duties with commitment.
Good leaders initiate employees to act in a particular manner until the goal is accomplished. A leader is a visionary
who predicts the results of a particular action in future and guides subordinates through effective communication
skills which help them to start work. A leader integrates various activities and maintains coordination between
various departments.

It helps in training and development of the subordinates. A leader understands that change in the methods of
production or technology may require implementation of training and development program. This will help in
increasing the skills and technical abilities of the employees. In this way, leaders make their subordinates cable of
performing complex task and also help in developing the qualities of leaders in their subordinates.

It motivates people. A good leader can understand the needs of the people and motivate them by fulfilling their
needs and keeping them satisfied. A leader guides employees with their work and influences employees to perform
their roles and responsibilities with the available resources. Employees are given financial and non-financial rewards
according to their performance which motivates them to work with full commitment.

Leadership Grid

A leadership grid is a tool used for identifying the concern of leaders for production and people in an organization.
The leadership grid is used by organizations for getting the work done to achieve their goals. The leadership grid
theory was developed by Robert Blake and Jane Mouton, who focused on developing a grid based on two aspects,
task orientation and relationship orientation.

The leadership grid provides five different leadership styles to the managers. In the Y-axis, the leadership grid shows
concern for people and in the X-axis, it shows concern for production. The five styles in the leadership grid are
country club style, team leader style, impoverished style, produce style and middle of the road style. Figure shows
the leadership grid given by Blake and Mouton:

The various forms of behavior of leaders based on their concern for production and concern for people are as
follows:

1. Impoverished or indifferent leadership

2. Produce or perish leadership
3. Middle of the road leadership
4. Country club leadership
5. Team leader leadership

Impoverished or indifferent leadership. In this form of leadership, leaders are not much concerned with the
production or the people. They are more self-centred and have little regard for either the level of production or the
employees.

Produce or perish leadership. In this form of leadership, leaders have their main focus on production which is their
only goal and have little concern for employees. The employees must follow the direction of the leaders who are
task-oriented. These leaders are considered as authoritarians.

Middle of the road leadership. In this form of leadership, leaders maintain a balance between the level of
production and the needs of people. It is a situation of compromise which leads to average or below-average
performance. Leaders are involved in keeping a balance between the goals of the organization and the needs of the
employees.

Country club leadership. In this form of leadership, leaders have more concern for the requirements of people than
the production level. These leaders believe that if employees are satisfied with their jobs, then they will give good
performance and automatically the organization’s productivity will improve.
Team leader leadership. In this form of leadership, leaders have a lot of concern for the people and also for the levels
of production for attaining organizational goals. This is the most effective form of leadership and is mostly preferred
by different organizations. The leader is committed to people and also to the goals of the organization.