Leadership

• Leadership can be defined as the ability of the

management to make sound decisions and
inspire others to perform well. It is the process
of directing the behavior of others towards
achieving a common goal. In short, leadership
is getting things done through others.
 Importance of Leadership

• Leadership is very important in a firm as it

leads to higher performance by the team
members, it improves motivation and morale
within the members, and helps to respond to
change.
• Leadership facilitates organizational success
by creating responsibility and accountability
among the members of the organization. In
short, it increases value in an organization.
 Leader Vs Manager

• A leader is someone whom people follow or someone

who guides or directs others. A manager is someone
who is responsible for directing and controlling the
work and staff in an organization, or of a department
within it.
• The main difference between the two is that a leader
works by example, while a manager dictates
expectations. If a manager goes against the rules, that
will tarnish his position as a manager. If a leader goes
against the example he or she is trying to set, that will
be seen as a setback.
 Following are a few differences
between the two −
•
• A leader is an innovator and creator whereas a manager is a
commander.
• A leader can’t be a manager but the opposite is possible, a
manager is more than a leader.
• A leader does what is right, while the manager makes things right.
• A leader deals with change whereas a manager plans for a change.
• A leader gives direction to do something whereas the manager
plans for everything that is to be done.
• A leader encourages people whereas the manager controls
people.
• A leader handles communication, credibility, and empowerment
whereas a manager deals with organizing and staffing.
 Leadership Styles

• Different leadership styles exist in work

environments. The culture and goal of an
organization determine which leadership style
fits best. Some organizations offer different
leadership styles within an organization,
depending on the necessary tasks to complete
and departmental needs.
• We find five different leadership styles in the
corporate world. They are as follows −
 Laissez-Faire

• A laissez-faire leader does not directly

supervise employees and fails to provide
regular updates to those under his
supervision. Highly experienced and trained
employees with minimal requirement of
supervision fall under the laissez-faire
leadership style.
 Autocratic

• The autocratic leadership style permits

managers to make decisions alone without the
input of others. Managers access total
authority and impose their will on employees.
No one opposes the decisions of autocratic
leaders. Countries like Cuba and North Korea
operate under the autocratic leadership style.
 Participative

• This is also known as the democratic

leadership style. It values the input of team
members and peers, but the responsibility of
making the final decision rests with the
participative leader. Participative leadership
motivates employee morale because
employees make contributions to the
decision-making process. It accounts to a
feeling that their opinions matter.
 Transactional

• Transactional leadership style is formed by the

concept of reward and punishment.
Transactional leaders believe that the
employee's performance is completely
dependent on these two factors. When there is
an encouragement, the workers put in their best
effort and the bonus is in monetary terms in
most of the cases. In case work is not done
properly certain kind of penalty will be applied .
 Transformational

• Creating high-performance workforce has

become increasingly important and to do so
business leaders must be able to inspire
organizational members to go beyond their
task requirements. As a result, new concepts
of leadership have emerged - transformational
leadership being one of them. Such leaders
are visionary, inspiring, daring, risk-takers, and
thoughtful thinkers.
Various Theories
 Traditional Theory

• Traditional theory is a theory based on different traits of a human

beings. It assumes that leaders are born and not made. According
to this theory, leadership behavior is the sum total of all traits that
a leader possess.
• Thus this theory gives the profile of a successful and complete
leader. According to this theory, there are five human traits. They
are −
• Physical trait − it includes energy, activity, appearance, and
height.
• Ability trait − it includes judgement, knowledge, and fluency in
speech.
• Personal trait − it includes self-confidence, creativity, and
enthusiasm.
• Work trait − it includes organization and achievement.
• Social trait − it includes interpersonal skill, cooperativeness,
popularity and prestige.
 Behavioral Theory

• This theory explains the effectiveness of leadership. According to

this theory, leadership has two qualities i.e., initiating structure
and consideration. These qualities are tested with higher and
lower levels with proper intersection of each other.
• Initiating Structure
It is the level up to which a leader is task oriented and directs the
employee towards achieving a goal. In this case, the leader gives
instruction, makes plan and schedules work activities.
• Consideration
It is the level up to which a leader is concerned with the
sub-ordinates, ideas and feelings. Considerate leaders are friendly,
they show concern for sub-ordinates’ well-being and satisfaction.