Section 13: Leadership

Discuss the pros and cons of leadership styles and topics.

Leadership is a combination of an individual’s personality traits, behaviors, and situations. But the topic of leadership goes well beyond those three measures, they include the leader’s style of leadership, how they builds relationships, and how they adapts to the issues and challenges that are presented in today’s fast-moving environment.

Learning Outcomes

  • Identify leadership styles
  • Understanding trust as an element of successful leadership
  • Identify contemporary leadership roles
  • Discuss common issues leaders must face
  • Identify challenges to the concept of leadership

Leadership Styles

We’ve already talked about how personality traits, behaviors and situations (and response to those situations) affect leadership. But what about style? Every leader has their own personal approach. In fact, one might assume that there are as many leadership styles as there are leaders.

Traditional Leadership Styles

Leadership style is a leader’s approach to providing direction, implementing plans, and motivating people. In 1939, psychologist Kurt Lewin and a team of researchers determined that there were three basic leadership styles: Authoritarian (Autocratic), Participative (Democratic) and Delegative (Laissez-Faire). They put these three leadership styles into action with a group of school children charged with the completion of a craft project to determine responses to the leadership styles.

Authoritarian (Autocratic) Leadership

Photo of several game pieces. A black game piece is separated out from a group of red game pieces.A leader who adopts the authoritarian style dictates policy and procedure, and directs the work done by the group without looking for any meaningful input from them. The group led by an authoritarian would be expected to complete their tasks under close supervision.

Researchers found there was less creativity under an authoritarian leadership style, but the children were still productive.

While authoritarian leadership sounds stifling, it has its place: it’s best applied to situations where there is little time for group decision making, or when the leader has expertise that the rest of the group does not. When authoritarian leadership strays into areas where it’s not needed, it can create dysfunctional environments where followers are the “good guys” and domineering leaders the “bad guys.”

Participative (Democratic) Leadership

Group members feel engaged in the decision making process when they have a participative leader. Those leaders practicing the participative leadership style offer guidance to the group, as for their input in decision making but retain final say. Participative leaders make their group feel like they’re part of a team, which creates commitment within the group.

Lewin’s researchers found that the participative style of leadership yielded the most desirable results with the school children and their craft project. They weren’t quite as productive as the children in the authoritarian group, but their work was a higher quality.

There are drawbacks to the participative style. If roles within the group are unclear, participative leadership can lead to communication failures. If the group is not skilled in the area in which they’re making decisions, poor decisions could be the result.

Delegative (Laissez-Faire) Leadership

Leaders practicing the delegative leadership style are very hands-off. They offer little or no guidance to their group and leave decision making up to the group. A delegative leader will provide the necessary tools and resources to complete a project and will take responsibility for the group’s decisions and actions, but power is basically handed over to the group.

Lewin and his team found that the group of children trying to complete the craft project under the delegative leader were the least productive. They also made more demands of their leader, were unable to work independently and showed little cooperation.

The delegative style is particularly appropriate for a group of highly skilled workers, and creative teams often value this kind of freedom. On the other hand, this style does not work well for a group that lacks the needed skills, motivation or adherence to deadlines, and that can lead to poor performance.

As you might have guessed, further research has yielded more leadership styles than the original three that Lewin and his team identified in 1939. Still, Lewin’s studies were influential in establishing a starting point for this kind of research. Let’s take a look at some additional leadership styles proposed by researchers since Lewin developed his original framework.

Transactional Leadership

Transactional leadership is a set of activities that involve an exchange between followers and leader and deal with daily tasks (Bass, 1990). Transactional leadership deals with those day-to-day tasks that get the job done. The majority of models we talked about in the last section—Fiedler’s Contingency Theory, Path-Goal among them—are based on the concept of this exchange between leaders and followers. The leader provides followers with direction, resources and rewards in exchange for productivity and task accomplishment.

Charismatic Leadership

Illustration of a man in a suit holding a cell phoneCharismatic leaders don’t doubt their own decisions, they move forward unwaveringly and believe that the decisions they make are the correct ones. They move through a crowd of their followers shaking hands and lending an encouraging word. They are undeniably clear on their expectations and where they see the company going. They have mastered the art of developing images for themselves that others want to emulate. Charismatic leaders have four common personality traits (Conger, Kanungo, 1998):

  • High degree of confidence and lack of internal conflict
  • High energy and enthusiasm
  • Good communication skills
  • Good image and role model

The relationship between charismatic leader and followers is an emotional one (this can sometimes go awry—just think about the relationship between the leaders and followers in a cult). In order for a charismatic leader to be effective, the situation has to be right. There are four situations required for a charismatic leader to have success:

  • Organization is in a time of crisis or stress.
  • Organization is in need of change.
  • There is opportunity for the organization to have new goals or direction.
  • Availability of dramatic symbols (like the CEO taking a pay cut or donating his salary to charity)

Culturally speaking, those cultures with a tradition of prophetic salvation (e.g., Christianity, Islam) are more welcoming of the charismatic leader, while cultures without prophetic tradition are less likely to embrace them.

In spite of a limited amount of scientific study where charismatic leaders are concerned, researchers agree there are applications and lessons to be learned out of this type of leadership. Leaders should have belief in their own actions. They should seek to develop bonds with their followers. And they must be able to communicate their messages clearly.

Transformational Leadership

Transformational leadership takes a chapter out of the book of charismatic leadership. (Bass, 1990) Followers admire and are inspired to act. But the transformational leadership concept takes that one step further and expects intellectual stimulation from a leader, as well as individual consideration, in which a leader singles out followers and provides them with additional motivation.

Transformational leaders motivate and teach with a shared vision of the future. They communicate well. They inspire their group because they expect the best from everyone and hold themselves accountable as well. Transformational leaders usually exhibit the following traits:

  • Integrity
  • Self-awareness
  • Authenticity
  • Empathy

Measuring a leader’s ability to inspire and enable is a challenge, so researchers rely on anecdotes to supply data. This makes scientific study difficult. And even though this theory emphasize leadership behavior, it’s difficult to determine how a leader can learn to be charismatic and transformational.

Servant Leadership

If you’ve read up on the Southwest Airlines organization, then you already understand the concept of servant leadership – they profess to practice it daily. A “servant leader” is someone, regardless of their level on the corporate hierarchy, who leads by meeting the needs of the team. (Greenleaf, 1970)

Values are important in the world of servant leadership, and those that lead within this network do so with generosity of spirit. Servant leaders can achieve power because of their ideals and ethics.

Practice Question

Learn More

There are many more leadership styles out there to be studied. Daniel Goleman, et. al., has written extensively about the concept of emotional intelligence in business, and he and his team review six emotional leadership styles in their book Primal Leadership. Flamholtz and Randle proposed a leadership style matrix in 2007 which measures the quality of people on a team versus the quality of the task to determine which leadership style is most appropriate.

By understanding various frameworks of leadership and how they work, those who are stepping up to lead can develop their own approaches to leadership and be more effective.

Trust and Leadership

The leader who does not establish trust will have no followers. Trust is the primary attribute associated with leadership, and trust that is broken can have an adverse effect on a group’s performance. People are unlikely to follow someone they think is dishonest, or someone they think will take advantage of them. Conversely, when followers trust a leader, they’re willing to be vulnerable to the leader’s actions.

What Is Trust?

Photograph of three individuals putting their hands together in a symbol of agreementWhat is trust? Trust is a positive expectation that another individual will not act opportunistically at another’s expense. Trust is dependent on history, based on relevant but limited samples of experience. Trust involves five key dimensions:

  • Integrity: the honesty and integrity of the individual.
  • Competence: the knowledge and ability of the individual.
  • Consistency: the reliability of the individual.
  • Loyalty: the willingness of the individual to protect the interests of another.
  • Openness: the individual’s willingness to be forthcoming with others.

In today’s world of business, there are plenty of reasons for trust to be deteriorating. Wells Fargo took advantage of sales teams and, with them, their own customers, and their predatory behavior was called onto the carpet in front of Congress. Volkswagen’s faked emissions testing cost their business customers and international relations. Facebook has been taken to task for lax security measures around users’ personal information, and the lack of checks and balances in their advertising policies may have influenced our country’s presidential election.

Whether trust is lost between a leader and a follower, or a customer and a company, it costs the organization money.

Types of Trust

There are three types of trust in organizational relationships.

  • Deterrence-based trust. Perhaps the most fragile of all the types of trust, deterrence-based trust is based on the fear of reprisal if trust is violated. A new employee might extend deterrence-based trust to his or her new manager, understanding that there is limited experience on which to base any other trust. The potentially harmed party must be willing to introduce harm in return if the trust is violated. “I am willing to speak poorly of you if you do the same to me,” is an example of that.
  • Knowledge-based trust. This trust is the most common, and it’s based on the behavioral predictability that comes from a history of interaction. Even when an individual can predict that another individual will be unpredictable or untrustworthy, knowledge-based trust can still exist. “I know enough to know he won’t show up on time and he won’t bring the pizza,” is what one might say in a knowledge-based trust situation.
  • Identification-based trust. This is the highest level of trust achieved between two individuals, because it’s an emotional connection between them. This trust is based on a mutual understanding of each other’s intentions and appreciation of the other’s wants and desires. A happily married couple exercises identification-based trust, as well as two people in an organization who have worked together for a long period of time.

Practice Question

Principles of Trust

Where an organization is concerned, there are some basic trust principles that leaders should keep in mind:

  • Growth can mask mistrust. In a time of organizational growth, leaders enjoy rapid promotions and increased power and responsibility. Leaders who don’t plan to be with an organization for very long can take shortcuts and leave issues of mistrust for their successors to handle.
  • Decline tests the highest levels of trust. There’s nothing like a string of layoffs or an episode of corporate downsizing to erode even strong levels of trust.
  • Trust increases cohesion. Group members who display trust in each other will work together and exert high levels of effort to achieve goals. Mistrusting groups should expect the exact opposite.
  • Mistrust generally reduces productivity. While trust doesn’t necessarily increase productivity, mistrust almost always decreases it. Mistrust forces group members to focus on individual differences, which makes it hard to visualize any common goals.

In a 2016 survey done by Price Waterhouse Cooper, they reported that 55% of CEOs think a lack of trust is the biggest threat to their business. Certainly , companies whose employees consider them “high trust” are experiencing a lot of advantages: their employees report 74% less stress, 106% more energy at work, 50% higher productivity, 13% fewer sick days, 76% more engagement, 29% more satisfaction with their lives, 40% less burnout.1

Be trustworthy.

Leadership Roles

Leaders are leaders because they’re asked to face new challenges and take on new roles all the time. The most successful of them are able to adjust and put their leadership skills to work in these new atmospheres. Let’s take a look at some of the demands today’s business are asking their leaders to shoulder.

Providing Team Leadership

Photograph of several individuals hiking. The sun is setting, casting all individuals in shadow.We discussed teams and team management in an earlier module. But what of the organization that decides to adopt a team approach. Traditional leadership roles are very different from that of a team leader. How do leaders move from a world of individualism to one of teams?

The command-and-control aspects in the world of individualism no longer make sense in the team environment, so this is one reason why some leaders find it impossible to adapt. Those leaders that have a more authoritarian style are likely to struggle and even fail here. But those that have a strong participative leadership style might take to team leadership like an organizational duck to water, and a large percentage of those with other leadership styles can adapt and learn.

Leaders being asked to become effective team leaders are expected to share information, give up authority, trust others and understand when to intervene. They often act more as facilitators than they do leaders. It’s often a bit of a balancing act—especially at first—to determine when a team needs more autonomy and when the leader needs to jump in.


Leaders often assume the “management” responsibilities around a team, like coaching, handling disciplinary issues, reviewing performance, training and communication. In addition, team leaders need to take on these four roles:

  • Liaisons with external constituencies. The team leader represents the team to all external parties, including upper management, customers and suppliers. In this capacity, the team leader can obtain resources for the team, clarify expectations with outside parties and seek information necessary for the team to do its job.
  • Troubleshooter. Team leaders are often called upon to solve team problems, whether they’re internal or whether they need external intervention, like gaining additional resources.
  • Conflict managers. When disagreements occur, the team leader helps to manage them in an equitable way and tries to minimize the disruption of the disagreement.
  • Coaches. Team leaders are looked upon to provide coaching and even some cheerleading, to support and improve the team’s performance.

It’s with these four roles that team leaders focus on managing the team’s external boundary and facilitate the team’s process.

Practice Question


Photograph of an older man helping a young woman fill out paperwork.Leaders are often called upon to share their knowledge and skill with less-experienced employees who are new or show potential to hold similar positions one day. Some companies have formal mentor programs that call upon their leaders to share knowledge and spend time with high-potential younger employees, and in other organizations it’s informal.

In a typical mentor/mentee relationship, the mentor provides guidance and assesses the skills of the mentee through observation and modeling. He or she would provide advice on handling a particular situation, and then follow up at a later time to understand the outcome of the mentee’s issue, guiding him or her through any fallout or feedback that may have occurred. A mentor might act as a sounding board for ideas the mentee has but is reluctant to share with direct supervisors. These actions help the mentee build skills.

Mentors also lobby on behalf of their mentees, helping them gain visibility through special assignments, helping them earn promotions or salary increases, and advocates for him or her in higher circles within the organization.

These are all great situations for the mentee, but what about the mentor? Do they benefit? Absolutely! Mentees provide the mentor, who is presumably at a higher level, unfiltered access to the attitudes and sentiments of the lower echelons of the organization. The mentor/mentee relationship is an important communication channel to identify issues before they become issues. Mentoring can also provide personal satisfaction to senior executives, who get the opportunity to share their knowledge and experience with others.

The organization also sees a benefit from a mentor/mentee relationship. Mentees are often more motivated and less likely to quit, so mentor/mentee programs directly impact innovation, motivation and turnover.

However, there are some drawbacks of the mentor/mentee program: women and minorities are less likely to be chosen, because mentors are, more often than not, white males, and people naturally choose to mentor those they relate to the easiest. However, organizations are creating formal programs to ensure that more women and minorities can benefit from this experience.

Practice Question

Issues in Leadership

Now that we’ve talked about the various roles a leader can be called on to fill, what about some of the bigger issues in today’s environment?

New Technology

A retail company is testing the use of artificial intelligence for their email marketing. An employee writes an email that lets their customers know about an event or a sale going on in the store that weekend. Artificial intelligence then writes seven more email subject lines for that same email. They send all eight to a test group of their loyal shoppers, and over the course of a couple hours, the company is able to determine which of those eight subject lines entices customers to open the email. That subject line is then put on emails to all the other loyal customers in the retail chain.

Photograph of a woman typing on a laptopThe objective of using artificial intelligence to write emails is to attempt to increase email open rates. In fact, this retail company is experiencing a 5% increase in open rates, which translates to approximately eight more transactions per weekend in each of the retail chain’s stores across the country.

A leader was once called upon to manage the employee who was clever enough to write a subject line that enticed customers to open emails. Now that leader is tasked with identifying technology that will help them increase the effectiveness of their email marketing programs, but they need to manage that technology, and the employees who are manipulating that technology for results.

Technology will disrupt the workforce (that retail company didn’t need to hire a marketer to write emails, after all) and it will provide all the “big data” the leader could ever want to make decisions about how to market to customers. Technology is an ever-changing tide of new information that’s difficult to stay on top of and difficult to manage once its within the walls of the organization. Leaders must find a way to provide guidance for employees, reinforce the company’s mission and vision, and incorporate these new options into daily operations.

Industry Disruption

Technology is often the fuel for industry disruption. Leaders today are unwittingly forced into change management situations when a new business model pops up and changes all the rules they’ve been operating under.

New Competition

Satellite dish and cable companies were charging outlandish amounts of money per month for their television services having entered most large markets thirty years before, disrupting the broadcast television market. They were getting fat off their profits when a little company called Netflix started sending DVDs by mail . . . and then went online. Netflix was a market disruptor, and other options like Hulu followed soon behind them.

Transactional leaders quickly found themselves smack in the middle of change management situation—trying to determine how their companies could reposition themselves and distinguish them in the market, and then provide that new vision to their employees.

Leaders at the U.S. Postal Service found themselves doing it when faced with FedEx; cab and limousine services all over the country found themselves doing it when Uber and Lyft arrived on people’s cell phones.

Has our last hundred years of research prepared us for the choppy waters these digital times have presented to us? Certainly, organizations are not just looking for the leader who can react to the industry disruption being forced upon them, but the leader that can do a little disrupting. According to research done by Forrester, a research and advisory firm, qualities that leader may need to have include:2

  • Ability to break barriers
  • Liberate talent and free people from “rules”
  • Be a model of behavior
  • Put innovation on display

If that seems a little vague, it is! As we move to a customer-focused business world, industry disruption will continue to raise the bar to new and innovative heights. Leaders will either be leading the charge or responding in kind.

Dispersed Workforces

Photograph of a laptop sitting on a tree stump in the middle of the woods.A 2017 survey showed that 2.9% of all workers in the US worked from home.3 As a leader, it’s challenging to keep employees connected to the company’s vision—and each other—when they’re not physically present in the workplace.

As one leadership assessment concluded, “Leadership is leadership. Being authentic, connecting with others, promoting inclusiveness, networking, and all of the interpersonal skills that build relationships and trust are always important.” The application of those skills, however, is different, and leaders must learn to be deliberate and intentional in executing those skills.

Dispersed workforces require an understanding of culture (as sometimes these virtual teams are global), an effort to include all members, and leadership focus on reinforcing goals, celebrating wins and maintaining a connection to the organization’s vision.

Practice Question

Leaders assume roles and navigate issues so that their employees can perform at the highest possible level with as few disruptions as possible. Contemporary leaders face new roles and issues every day in this fast-paced world. Real leaders will continue to emerge as new situations present themselves.

Challenges to Leadership

Companies need leaders—or, do they really?

When a company succeeds, people need to give someone credit for that. It’s usually that company’s leader, the CEO, who takes the credit. If the company fails, people need someone to blame. Trundle out the CEO again! The figurehead of the organization is the figurehead of all successes and failures that come to that organization.

In reality, organizations’ successes and failures come from a wide variety of internal and external influences, some in which the CEO played a part, and some in which he or she didn’t. But when things go wrong, the people, the media, even the board of directors, don’t usually ask, “How is ousting the CEO going to solve our current problems?” Often times, the answer is, “It won’t.”

So, is leadership more about appearances than reality?

Leadership Attribution Bias

Attribution is the way people make sense out of cause and effect relationships. If a person wakes up with heartburn in the middle of the night, they may attribute it to the pizza they ate for dinner earlier. If a person is offered a promotion at their job, they may attribute it to the successful completion of a high-profile project earlier in the year.

The attribution framework shows that people characterize those with traits such as intelligence, outgoing personalities, aggressiveness, strong verbal skills and the like as leaders, or at least as leadership material. Similarly, individuals who score highly on task performance and relationship performance are seen to be good leaders. Situation doesn’t really get calculated into this point of view. They just have these traits and skills, so they are, without question, good leaders.

When an organization has extremely poor (or extremely good) performance, people are going to reach to make a leadership attribution to explain that performance. Humans have a tendency to overvalue a leader’s impact on performance. And this is why CEOs are either celebrated or take the fall, regardless of how much they’re actually responsible for the results.

When a leader is replaced, a new leader is likely to benefit from a phenomenon called regression to the mean. That is, most teams or people who are underperforming will naturally improve, without intervention, by reverting to their historical average performance. This will lead observers to come to the conclusion that the new leader is responsible for the improved performance.

So, in keeping with this attribution bias and theory, it would seem that having the appearance of being a leader is actually more important than actual accomplishments. People who aspire to leadership roles can attempt to shape the perception that they’re intelligent, have outgoing personalities, are aggressive, have strong verbal skills, and so on, and they’re likely to increase the probability that their managers, colleagues and employees will view them as an effective leader.

Substitutes and Neutralizers

Just as people can place too much value on the leader’s contributions to the success or failure of an organization, in some situations, a leader’s contribution can be completely irrelevant.

In 1978, Steven Kerr and John Jamier developed the substitutes for leadership theory suggesting that different situational factors can substitute or neutralize the effects of a leader’s efforts.4  While there were methodological issues with their findings, the study has held up and is worth considering here.

Situations that are neutralizers make it impossible for the leader behavior to make any difference to follower outcomes. Substitutes act as a replacement for leader influence. The impact of these different substitutes and neutralizers depends on whether leadership is relationship-based or task-based.

For instance, if an individual is intrinsically satisfied in their job, this can be a substitution for the contributions of a relationship-based leader. If an organization has very explicit formalized goals and rigid rules and procedures, this can be a substitute for task-oriented leadership.

There is some application for this theory. For example, autonomous workgroups have been considered a substitution for formal leadership. In autonomous workgroups, employees are divided into groups that are responsible for managing their own day-to-day work, including recruiting, hiring, distribution of tasks, etc.

Self-leadership is also an application for this theory. In self-leadership, the individual controls his or her own behavior through a set of processes. The underlying assumptions behind self-leadership are that people are able to exercise initiative without the external constraints of management, rules or regulations.

This concept has increased with the popularity of teams, as empowered, self-managed teams need team members who are, themselves, self-directed.

Practice Question

1. Zak, Paul J. “The Neuroscience of Trust.” Harvard Business Review. January/February 2017. Accessed April 29, 2019. ↵
2. McQuivey, James L., Michelle Moorehead, Ryan Trafton, and Kara Hartig. “Leadership In The Age Of The Customer: Customer-Obsessed Leaders Do Five Things Right.” Forrester. April 26, 2016. Accessed May 07, 2019. In The Age Of The Customer/-/E-RES134101. ↵
3. Parris, Jennifer. “The State of Telecommuting in the U.S. in 2017.” 1 Million for Work Flexibility. June 28, 2017. Accessed May 07, 2019. ↵
4. Kerr, S. and J. M. Jermier, “Substitutes for Leadership: Their Meaning and Measurement,” Organizational Behavior and Human Performance. 1978

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  • Leadership Styles and Topics. Authored by: Freedom Learning Group. Provided by: Lumen Learning. License: CC BY: Attribution
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