The success or failure of a group depends on the

leadership qualities of the manager who heads the group. If

the manager is an efficient leader, he can lead the individuals
towards the accomplishment of the common goals and
objectives. Harold Koontz and Heinz Weihrich have defined
leadership as the art or process of influencing people so that
they will strive willingly and enthusiastically towards the
achievement of group goals. The function of leadership is to
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set goals, direct the individuals, and motivate people to

achieve the goals. A leader makes the followers strive
willingly to accomplish group objectives. Therefore,
leadership skills are essential if a person has to be an
effective manager.In this unit, we will discuss the key
elements of leadership and different leadership theories.
 Key Elements of Leadership
•Efficient leaders possess four major qualities in
common..
•They behave responsibly while exercising power
or authority.
•They have the ability to understand that people get
motivated by different factors and that the
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techniques used to motivate people should vary

depending on the time and situation.
•They have the ability to inspire and encourage
individuals towards effective performance.
•They have the ability to develop and maintain a
harmonious work culture and atmosphere at the
workplace.
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 Leadership Theories
Leadership theories are classified into four categories:
trait theory, behavioral theory, situational theory or
contingency theory, and transformational theory.
Trait theory of leadership
Many leadership studies were conducted during the early and mid 20th
century in order to determine the traits of a leader. The trait theory of
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leadership is the result of such systematic studies by psychologists and

other researchers. The theory proposes that leaders possess certain. inborn
personality traits. "Great man" theory, one of the earliest trait theories,
states that leaders are born and not made. Trait theorists have tried to
associate certain characteristics such as physical, mental, intellectual, and
personality traits with leadership. However, with the emergence of the
behaviorist school of psychology, the "Great man" theory lost its
significance. The trait theory also lost its relevance as it was unable to
explain the lack of certain traits by leaders.
 Behavioral theories
The failure of the trait theory to identify a particular set of
leadership traits led to the development of the behavioral theory.
This theory is concerned with the study of the behavioral aspects
of leaders. The well-known behavioral theories are
• Iowa
• Michigan studies
• Ohio State Studies
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• Likert's four systems of management

• Managerial grid.
 Iowa University studies:
The University of Iowa studies identified three
leadership styles:
Autocratic style: The leader who adopts the autocratic style
practices centralization, dictates work methods, and makes
decisions without involving subordinates.
Democratic style: The democratic style of leadership encourages
employee participation in decision-making, consults subordinates
on proposed actions, and provides feedback to help subordinates.
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Laissez faire: Leaders who follow a laissez faire approach give

the employees the freedom to determine the goals and objectives,
and the work procedures to achieve them.
 Michigan studies:
Michigan' studies also identified two dimensions of leadership
behavior i.e., employee-oriented and production-oriented.
Employee oriented leaders are concerned about the needs of
employees whereas production-oriented leaders focus on the job
activities and the accomplishment of objectives.

Ohio State studies:

Ohio studies took two dimensions to explain leadership
behavior. They are:
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Initiating structure: This refers to the extent to which a leader describes

his role, individual roles, and the work and its relationships for the
achievement of organizational goals.
Consideration: This refers to the extent to which a leader is considerate
towards the group members and their opinions and views. The studies
showed that a leader who is high in both the dimensions displayed high
performance.
 Likert's four systems of management:
Rensis Likert and his associates at Michigan University
studied the various styles of leaders and developed four
systems of management.
System 1 management: This is also known as the 'exploitative-
authoritative' style. Managers who follow this style display dictatorial
leadership behavior and there is little scope for employee participation in
decision-making.
System 2 management: This is referred to as the 'benevolent-authoritative'
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style. Here, managers exhibit authoritative behavior but allow employee

participation in the decision-making.
System 3 management: This is called 'consultative management'. Though
the manager has little faith in his employees, he asks for their suggestions
and listens to any advice they may give. However, he takes the final
decision himself.
System 4 management: This is referred to as the 'participative leadership'
style. Managers in this system are considerate towards employees.
Employee participation in decision-making is encouraged. Managers
cooperate with their subordinates and consider their suggestions.
 The managerial grid:
The managerial grid was developed by Robert Blake and
Jane Srygley Mouton. The grid describes the various leadership
styles exhibited by managers. Here, managerial behavior is a
function of two variables, i.e. concern for people and concern for
production.
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 Leadership style 1,1 is known as impoverished management where managers do not
exhibit any leadership qualities, as they are least concerned about either the people or
production.
Leadership style 1,9 is known as country club management. Here, the manager has
high level of concern for people and low level of concern for production.
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Leadership style 5,5 ,is called middle road management, where managers balance
their concern for people and for production. They manage to achieve their goals while
keeping employees satisfied.
Leadership style 9,1 is known as task management. The managers exhibit a high
level of concern for production and low level of concern for people.
Leadership 9,9 is known as team management. The managers have a high degree of
concern for both people and the production. Managers encourage employeesto attain
goals. The theory proposes that managers who exhibit a high level of concern for
people are successful leaders