Leadership Styles and Leadership

¶ … Leadership Style on Employee Performance Management?

This paper looks into the effects of various leadership styles on the productivity of employees. The conceptual, theoretical and historical background of the study are elaborated along with a problem statement, objective of this study, research question, hypothesis, and the significance of conducting a research on the effects of leadership styles.

More and more stakeholders are looking into various leadership styles to better manage employees and the companies at large. The initial concept of personnel administration has all but been replaced by Human Resource management. This has led to the need for integration of various leadership styles to better manage employees and enhance their performance. An effective leader is one who quickly diagnoses problems and adopts relevant styles to prevent problems or do away with them. There are various leadership styles based on the empowerment given to employees, directions and their decision-making power.

Several studies have looked into employee performance verses various leadership styles such as democratic leadership, participative leadership and autocratic leadership. All these styles have their own benefits and drawbacks some of which will be investigated and later discussed in this study. The investigation of leadership styles and how they all differently affect performance dates back to the seventeenth century as companies grew and managers started treating people as machines and not human capital that must be motivated, encouraged and treated well to accomplish various goals (Iqbal, Anwar &Haider, 2015).

Conceptual Perspective

In this research, various styles of leadership such as participative, democratic and autocratic will be regarded as independent variables while employee performance will be regarded as a dependent variable. A conceptual approach will be developed based on the relationship between the variables so as to find out which leadership styles is the best for enhancing employee performance. Performance in this study will be looked at as: accomplishing departmental or organizational goals, executing the set duties and responsibilities, meeting deadlines and accomplishing team goals. If the above was met, it would lead to better organizational relations, better feedback, efficiency, specialization and increased revenues and profits (Iqbal, Anwar &Haider, 2015).

According to Carter (2008), leadership is the ability to use different managerial tools to inspire and motivate teams to achieve various organizational goals. By looking into how various leadership styles can affect performance, we can see which styles are most efficient in leading employees to achieve various goals in an organizations.

Theoretical Perspective

According to the Fiedler leadership contingency model, employee performance is based on a leader's ability to lead, which, in turn, is based on the leader's capability, his style of leadership, and the competency and behavior of his employees (Fisher, 1995). The conclusion was that leaders ought to adopt a style of leadership which they deem fit for their particular organizations so as to immediately stimulate the performance of their employees.

More and more people are understanding leadership not only as a persuasion, but also the ability to identify and promote values that would enhance performance. And not only that; a good leader is also supposed to give guidance and share knowledge so as to lead employees to improved performance and help them maintain or improve on that performance (Iqbal, Anwar &Haider, 2015).

Statement of Problem

Employee performance is all about accomplishing departmental or organizational goals, executing the set duties and responsibilities, meeting deadlines, accomplishing team goals and achieving efficiency and effectiveness in doing work. Organizations require strong leadership to improve performance. Almost all organizations will periodically face problems such as lower than expected performance, lower productivity and poor innovation. The root cause of such problems is often lack of strategic or effective leadership for that particular situation. It is for this reason that this study is looking to find out which leadership style is the best suited to stimulate employee performance. For without effective leadership such low performance problems are bound to persist or become worse and reduce revenues and profits (Iqbal, Anwar &Haider, 2015).

Purpose of Study

The purpose of this study is to find out the effects of participative, democratic and autocratic leadership on the performance of employees.

Specific Objectives

1. To investigate how exactly the above-mentioned leadership styles contribute to performance.

2. To look into the relationship between various leadership styles and performance.

3. To explain the theoretical background of why certain styles work and others don't.

4. To provide recommendations that can help leaders inspire their staff to better performance.

Research Questions

1. How do various leadership styles affect employee performance?

2. What outcomes can be achieved using an effective leadership style?

3. How does participative leadership affect employee performance?

4. How does democratic leadership affect employee performance?

5. How does authoritative leadership affect employee performance?

Study Significance

The significance of this study is to provide a deeper understanding of how various leadership styles affect performance so that those in leadership positions can come up with the right strategies and designs that will inspire their employees to perform better in the highly complex, diverse and competitive modern business world.

By accomplishing the study objectives set out above in this paper, this study will also help other researchers to better understand what effective leadership is. The most notable significance will, however, be that other researchers could use the findings in this research paper for their own studies that could end up creating a huge impact in the business environment. The findings and most especially recommendations of this study could help business leaders to make changes in their leadership so as to achieve enhanced performance (Iqbal, Anwar &Haider, 2015).

Scope of the Study

This study focuses on how democratic, authoritative and participative leadership styles affect employees' performance -- the execution of duties and responsibilities and the meeting of deadlines and organizational objectives.

Literature Review

Under this section, what researchers, authors and other relevant stakeholders have noted or argued about various leadership styles will be discussed. The theoretical framework of the effect of various styles on performance will also be discussed.

Leadership

Leadership is defined as the process of influencing, guiding and directing the conduct of others so as to achieve certain goals in any given situation. It can also be defined as the capacity of a leader to inspire a group to accomplish a goal. To be an effective leader, one needs to have a vision and to motivate his or her followers to achieve the vision within the set timelines. Leadership can also be thought of as the human factor that binds people or employees together and inspires them to improve their performance so as to achieve set visions (Adair, 2002).

Leadership Styles

According to researchers Goleman, Boyatzis and Mckee (2002), there exists different styles of leadership. These styles of leadership include autocratic, democratic and participative and are based on the degree of decision-making power and authority of the leaders and their subordinates.

The democratic leadership style is characterized by sharing inputs. In this style of leadership, decisions are made in teams and each member has an equal right to provide input. In this way, everybody feels vested in the performance of the team and the organization at large.

Participative leadership is that which entails all team members working to identify important goals and objectives and coming up with the necessary strategies and processes to achieve those goals. This, in essence, means that in participative leadership, the leader is more of a facilitator and not a manager of human resources or a giver of assignments and orders. According to Iqbal, Anwar and Haider (2015), participative leadership can be used and will work well in a variety of scenarios including volunteer organizations, at home and most especially in business settings.

One of the key advantages of participative leadership is that it allows for the grooming or development of potential leaders within the workforce who have the potential to effectively serve their organizations in high positions in the future. This is because, this style of leadership encourages active involvement among all staff on the team, which means all the employees have the opportunity to show their creativity and talent. This kind of freedom and opportunity would not be allowed in other styles of leadership. The expression of creativity and talent within teams will ultimately improve their performance. It would also help the organization they are working for to notice those with a potential to lead so that they can be provided with opportunities to further develop their leadership skills.

Even though each person is different and his or her own preferred style of leadership, the best leaders are those who adopt a style that best suits their current situation. To find the most appropriate leadership style for a situation, one needs to consider the following main factors:

a. The task -- How important is the business? Is there a need to make a decision immediately? What would be the potential impact of the business?

b. The Team -- Does the team being led have the right resources for that style? Is the team used to decision-making?

Tradition -- What are the norms that the employees hold dear to them? (Iqbal, Anwar &Haider, 2015)

Theoretical Framework

According to the Fiedler leadership contingency model theory, employee performance is based on a leader's ability to lead, which, in turn, is based on the leader's capability, his style of leadership, and the competency and behavior of his employees (Fisher, 1995). The conclusion was that leaders ought to adopt a style of leadership which they deem fit for their particular organizations so as to immediately enhance the performance of their employees.

According to Carter (2008), there are three broad types of leadership styles all of which have different qualities that affect employee performance in different ways.

Autocratic leadership: In autocratic leadership, the leader issues orders and expects his or her subordinates to obey and get to work immediately without any objections or arguments. Orders are issued without explanation and employees are expected to follow. All the decision-making power in this style of leadership rests with the leader. The leader might give unrealistic demands and end up punishing or disciplining anyone who does not follow. Leaders who use this style of leadership are also not likely to entertain questions or objections to their authority. It is also highly unlikely for an autocratic leader to give his or her employees any sort of recognition. Autocratic leaders also use others for their own benefits, are very competitive and often have a short-term focus.

Democratic or Passive Leadership: Theoretically, democratic leaders are the best leaders in a region. A democratic leader would make no decisions on his own, he or she would instead ask for the suggestions of others. The subordinates are left to make their own choices and decisions democratically and then the leader "rubber stamps" the said decisions.

Participative Leadership: In this style of leadership, every member of the organization has an equal opportunity to provide input to the decision-making process. Opinions are sort by the leader from the followers and then the leader uses the data he or she has gathered to make their decisions. The group is also informed about decision made and consultations continue between parties as time goes on (Iqbal, Anwar &Haider, 2015).

Effect of Different Leadership Styles on Employee Performance

A participative leadership style has greater effect (positive) on employee performance than the other two styles. This is because under this style of leadership, employees feel as if they have ownership of the decision-making process and the decisions made. This encourages them to work harder, resulting in improved performance. This is in contrast to autocratic leadership style in which the sole authority to make decisions lies with the leader, making employees feel inferior and thus work only for pay. Democratic style of leadership is slightly better than autocratic as employees have some say in the decision-making process. However, it is a passive style of leadership hence it can't achieve better outcomes than participative leadership.

Research Methodology

This study will employ a descriptive approach which entails the use of interviews and focus groups to investigate the research questions. The use of this method of investigation will help to describe the situation better and to explore how the relationship between the three styles of leadership and employee performance.

Data Collection from Secondary Sources

This study will also integrate secondary research. The purpose for this is to ensure that enough information is gathered and that the discussion is enough for readers to comprehend the issues at hand and how the different variables relate to each other. Sources that will be used for secondary research include journal content, magazines, newspapers and reports. The interpretation of data from the secondary sources will be regarded as qualitative (Iqbal, Anwar &Haider, 2015).

Hypothesis

H1: There is a direct relationship between leadership styles and performance improvement.

H2: Participative leadership style has great effect on the performance of the employees.

H3: Autocratic leadership has a great effect on the performance of the employees

H4: Democratic leadership has a great effect on the performance of the employees.

Data Analysis and Discussion

The style of leadership that one chooses to run his or her organization will have substantial effects on the employees and the organization's bottom line, whether it is a small business or a giant corporation. A leadership style affects everyone in the organization from the executive to the most junior employee. This is because leadership styles create a corporate culture that will influence how everyone behaves relative to meeting the organization's goals. As mentioned before, a leadership style is defined as how a leader behaves with regards to making decisions (supervision and governance). Different scenarios are best handled using different leadership styles. For instance, in situations where there is little time to consult with others to find an agreement, there is need for work to be done quickly or the leader is far more experienced than his or her employees, then the best style of leadership would be autocratic leadership. However, in cases where team members have almost the same level of education and experience and are highly motivated to work towards achieving the team's goals, then a participative or democratic leader may be the best match for the job. The best style of leadership is that which will most efficiently meet the team's goals while taking into account the skills and interest of the team members.

Autocratic Leadership Effects

There is not a single leadership style that can be applied to all situations. However, some are better suited for the majority of situations than others. For instance, even though autocratic leadership is suited for situations where there is a need for one to make a decision quickly and to take responsibility, studies indicate that autocratic leaders are often less creative compared to leaders who use other leadership styles (Iqbal, Anwar &Haider, 2015).

Also, autocratic leaders make their followers feel inferior because in their organizations, all power and authority is vested in one person. Vesting all power in one individual is good in the short-term, especially in situations where there is need for quick decision-making (Dawson, 2002). However, excessive authority would likely disrupt performance and productivity in the long-term. This is because the employees will either get dissatisfied and bored with repetitive tasks that lack innovation and creativity. This is one of the reasons why autocratic leadership fails most of the time -- the employees have no motivation to work hard. The lack of motivation and the feeling of inferiority can make even the most talented individuals leave an organization, disrupting productivity and performance (Iqbal, Anwar &Haider, 2015). This rigid leadership style also limits workplace socialization and communication -- two factors which are important in preventing conflicts and disagreements among employees.

Democratic Leadership Effects

Most companies prefer this type of leadership. This is because democratic leadership focuses on providing followers with guidance while providing guidance to individual team members. Democratic leaders actively consult with their employees in finding solutions to problems. Democratic leadership is all about sharing decision-making responsibility, regular consultations and delegation of duties and responsibilities. The managers who utilize this type of leadership take the recommendations and suggestions of their employees seriously and they properly delegate duties and give those below them full responsibility to execute certain tasks and encourage them to do well and later take on leadership positions. According to Iqbal, Anwar and Haider (2015), this type of leadership results in greater commitment by employees to departmental goals, organizational goals, meeting deadlines and performance improvement.

Various studies of employees' perspectives of their managers also point to the fact that the democratic style of leadership focuses on positively using the ideas, experience and skills of others to move forward an agenda. Even though participation is encouraged, democratic leaders still retain the final decision-making authority. The good thing is that they will not make that decision without first seeking the input of the relevant employees. It is easy to see how this style of leadership would enhance employee performance both in the short-term and in the long-term, and can basically be used to handle almost every type of business scenario. Furthermore, the democratic style of leadership is crucial in situations where organizations require training of employees to take on senior roles, the day-to-day tasks are not repetitive, and where there is a need for creative problem solving. Democratic leaders also inspire confidence in their employees to suggest their own ways of meeting deadlines and improving their output (Iqbal, Anwar &Haider, 2015).