Leadership Theories and Styles
Leadership
Leadership Theories and Styles
Syllabus tag: KASNEB CPA | Advanced Level | CA31 Leadership and Management | Topic 3 Leadership Theories and Styles
Lesson objectives
By the end of this topic, you will be able to:
- Distinguish leadership from management
- Trace the development of leadership theory
- Apply the situational and contingency models
- Distinguish transactional from transformational leadership
- Select a style appropriate to a given situation
Why this matters
The syllabus asks candidates to apply a theory to a scenario, not recite it. An answer that names Fiedler without saying what his model implies for the manager in the question earns few marks.
Leadership and management
| Management | Leadership |
|---|---|
| Administers | Innovates |
| Maintains | Develops |
| Relies on control | Inspires trust |
| Short-range view | Long-range perspective |
| Asks how and when | Asks what and why |
| Accepts the status quo | Challenges it |
| Does things right | Does the right thing |
The distinction is useful and often overdrawn. An organisation needs both, and most senior roles require the same person to do both — leading on direction while managing delivery. A candidate who treats management as inferior has misread the point.
The development of the theory
Trait theory. Leaders are born with distinguishing characteristics — intelligence, confidence, drive, integrity. It failed because no consistent list emerged and it could not explain leaders who succeeded in one setting and failed in another.
Behavioural theories. Attention moved from what leaders are to what they do.
- The Michigan and Ohio studies identified two dimensions: concern for task and concern for people
- Blake and Mouton's grid plots these on nine-point scales, giving 1,1 impoverished, 9,1 task management, 1,9 country club, 5,5 middle of the road, and 9,9 team management as the ideal
The behavioural approach's weakness is that it proposes one best style, and the evidence does not support that.
Contingency theories. The right style depends on the situation.
Situational and contingency models
Tannenbaum and Schmidt describe a continuum from tells, through sells, consults and joins, with managerial authority falling and subordinate freedom rising along it. The appropriate point depends on forces in the manager, in the subordinates and in the situation.
Hersey and Blanchard relate style to follower readiness:
| Follower readiness | Style |
|---|---|
| Low ability, low willingness | Telling |
| Low ability, willing | Selling |
| Able, unwilling or insecure | Participating |
| Able and willing | Delegating |
The practical implication is that style should change as a subordinate develops, and a manager who uses the same approach with a new recruit and a twenty-year veteran is wrong with at least one of them.
Fiedler argues that a leader's style is relatively fixed, so the situation should be matched to the leader rather than the leader adapting. Situational favourableness depends on leader-member relations, task structure and position power. Task-oriented leaders perform best in very favourable or very unfavourable situations; relationship-oriented leaders in the middle.
Adair's action-centred leadership identifies three overlapping needs the leader must balance: the task, the team and the individual. Neglecting any one damages the others — driving the task while ignoring the individual eventually costs you the task.
Transactional and transformational
Transactional leadership works through exchange: clear objectives, monitoring, reward for performance and correction of deviation. It is effective in stable conditions and is essentially good management.
Transformational leadership works through four elements:
- Idealised influence — acting as a role model
- Inspirational motivation — articulating a compelling vision
- Intellectual stimulation — encouraging challenge to assumptions
- Individualised consideration — attending to each person's development
Transformational leadership suits change and uncertainty, where compliance is not enough and commitment is required.
The two are complementary rather than opposed. A transformational leader with no transactional capability inspires people towards goals that are never delivered.
:::checkpoint A newly appointed finance manager inherits a team of experienced, capable accountants who are demoralised after a failed system implementation. Using Hersey and Blanchard, identify their readiness level and the appropriate style, and say what Adair would add. :::
Power and influence
French and Raven identify five bases:
| Base | Source |
|---|---|
| Legitimate | The position held |
| Reward | Control over benefits |
| Coercive | Ability to punish |
| Expert | Knowledge and skill |
| Referent | Personal respect and identification |
The first three come with the job; the last two are earned. Expert and referent power produce commitment; coercive power produces compliance at best and resentment usually. A manager relying on position alone has the weakest form of influence available.
Choosing a style
The factors an examiner expects to see weighed:
- The task — urgent and unambiguous, or complex and open?
- The team — experienced or new, willing or resistant?
- The leader — their own preference and credibility
- The organisation — its culture, structure and time pressure
- The consequences of error — high risk narrows the case for delegation
A crisis justifies an autocratic style that would be destructive as a permanent approach. Saying so is a better answer than declaring any one style superior.
:::checkpoint A company faces a cash crisis requiring decisions within days, and its managing director consults the whole management team on every step. Discuss whether the participative approach is appropriate, and what the risk is either way. :::