Organizational Leadership

Theories
A leader is someone who influences others to
attain the goals of a group or organization. As a
small business owner, you are the leader of your
organization and would probably like to know
what makes some leaders successful while others
have less success. This is where theories of
leadership in organizational behavior come in.
 The truth is that there is no magic formula. There
is no fixed set of characteristics that make one a better
leader in all circumstances. However, that doesn’t
mean you can’t be a successful leader. When you have
an understanding of leadership theories and
concepts, then you should be able to pick the
approach that works for you, depending on your
unique circumstances.
The Trait Theory of Leadership
• According to trait theory, there are specific traits that are shared by all
successful leaders. In fact, when the earliest forms of this theory were
declared, leadership was considered to be an innate quality; a trait in
and of itself, that some people are born with. However, over time, the
theory was refined to show that many of these leadership traits can be
acquired by those who have not had the good fortune of being born
with them.
• Traits that are common to leaders include empathy, integrity, likeability,
critical thinking, decision making, assertiveness, and many others. All of
these are traits that prove important when helping others and can be
developed.
• No Guarantee

• A disclaimer must be made here. Having any of these traits, in

any given combination, does not guarantee that the owner of the
traits is going to succeed as a leader. It should be understood that a
trait isn’t an internal quality; a trait is an external manifestation of our
internal mental processes. It is the beliefs and perspectives we hold
within ourselves that make for our ability to be effective and
successful leaders.
• Certain traits will, therefore, manifest themselves as a result of these
internal processes. To work on the trait rather than the internal
process that generates it is to put the cart before the horse.
The Behavioral Theory of Leadership
• According to behavioral theory, a leader is as a leader does, so the
focus is on the common behaviors of leaders. In that case, there are
many types of behaviors exhibited by leaders all around the world and
throughout history. There are leaders whose word is law, and there
are those that prefer to allow the people to have a hand in the
decision-making process.
• Which are better? Again, it all depends, and there is no magic formula
even here.
• According to the framework developed by Kurt Lewin in the 1930s,
there are 3 types of leadership under behavioral leadership theory:
• Autocratic Leadership: These are the leaders who do not consult their
subordinates when making decisions in the workplace. Once the
decisions have been made the subordinates are expected to
cooperate with them with no objections. This type
of leadership certainly has an environment where it is highly effective.
When decisions have to be made fast, and the leader
has extensive knowledge and experience, needing little input, then
they can use autocratic leadership to their advantage.
• Autocratic leadership also works in situations where goals and
outcomes are quite clear, and the agreement of the team with the
leader’s decisions is not necessary for the outcome to be successful.
• Democratic Leadership: A democratic leader seeks the input of their
subordinates before making a decision. The exact degree of input
that the leader wants from their team will vary with the leader.
Democratic leadership works in situations where the agreement of
the team is necessary for a successful outcome. It also works when
the team is cohesive and well-aligned with its goals.

• There should also be a time for deliberations before decisions are

made. This kind of leadership can be difficult in situations where the
team is so diverse as to have too many different ideas and
perspectives.
• Laissez-Faire Leadership: This type of leader does not involve
themselves in the dealings of their subordinates. They give their
subordinates the leeway to make their own decisions and direct their
own work. To be sure, this type of leadership can work in certain
situations, such as where a team is composed of highly skilled and
experienced individuals who are competent, motivated, and capable
of taking initiative, therefore not requiring any kind of supervision.
• It doesn’t work very well outside of this very particular environment.
In fact, most of the time, laissez-faire leadership is the result of a lazy
and distracted leader, and it fails more often than not.
• The behavior of a leader will directly affect a team's performance.
According to studies that have been conducted over the years, each
of these leadership styles is appropriate in different situations. A good
leader is one who can use the right style in the right circumstances.
The Functional Theory of Leadership
• According to this theory, the leader has one main responsibility: to assess
the needs of their followers and then meet those needs. They are also
tasked with other functions that relate to this one main responsibility:
• To monitor the environment within which their subordinates work.
• To organize activities for their followers so that everyone always has
something to do.
• _To train their subordinate_s and increase their knowledge and skill sets.
• To motivate and inspire their followers.
• To participate in the activities of the group. This is important as it forces
them to have skin in the game and builds trust in them among their
followers.
The Transformational Theory of
Leadership
• According to this theory, the leader is tasked with seeing the bigger
picture in every situation and motivating their followers to attain
greater goals and execute the group’s vision. This type of leadership
demands that the leader be clearly visible to followers and that they
are accessible at all times. They should constantly look for new ideas
and ways to realize the goals of the group.
The Transactional Theory of Leadership
• According to this theory, a leader is defined by an ability to reward
those who perform well and to punish those who do not. A leader
should have a specific goal for followers to work toward. A leader
should also have the ability to train followers to give them the ability
to work towards that goal. From there they should evaluate their
followers’ performance and determine whether it is satisfactory. They
should also have the authority to reward those followers who meet
their objectives and punish those who do not.
The Environmental Theory of Leadership
• According to this theory, it is the work of a leader to create
the right kind of environment, where their followers will flourish. By
using psychological principles, they should be able to build the
right kind of environment for the motivation of their followers and then
make that environment self-sustaining.
• According to this theory, _a good leader will give the group the
right kind of cultur*e* that motivates followers to meet their
objectives out of care for the benefit of the group, rather than from
coercion. Environmental leaders do not lead, as much as they create
the right kind of environmen_t, in which workers work toward group
goals, out of their own will.
Situational Contingency Theories
• Situational contingency theories maintain that the situation is the
ultimate factor in the leadership style adopted by a leader. With that
in mind, there is no single ultimate leadership style. Autocratic
leadership works in times of intense crisis, whereas democratic
leadership works in times of relaxation. Situations dictate the most
appropriate type of leadership style for other leadership styles, as
well.