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Why Is Leadership Style Important for a Company?

In the present paper, the author argues that leadership style matters because it heavily affects the overall performance of a company.

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To begin with, the claim that a leadership style does not matter is groundless and is not supported in the academic and expert community. The primary reason for this is that the style of leadership affects the prosperity of a company. In addition to that, the studies conducted by Chang (2017) and Tao et al. (2017) prove that leadership style has a strong correlation with employees job satisfaction. In other words, employees’ feeling of satisfaction is higher in companies that encourage them to express themselves and guarantee that their opinion will be heard. Furthermore, a transformational style of leadership positively affects the extent of workers motivation because the head of a company puts effort into the stimulation of the subordinates with the aim of achieving a better performance of a company (Alghazo & Al-Anazi, 2016; Buble, Juras, and Matic, 2014). Besides, it is curious to notice that personality of a leader matters as well. Weston (2018) writes that companies with humble leaders are generally more successful in comparison with companies governed by arrogant people.

The success of such companies as, for example, Google, Microsoft, LVMH, and General Electric is commonly associated with the adherence of their founders to the laissez-faire leadership style. However, Yang (2015), Skogstad et al. (2007), and Agotnes et al. (2020) are convinced that laissez-faire policies lead to increased work pressure, role ambiguity, and confrontation of coworkers. At this point, it should be noted that any leadership style could not be regarded as universal and, hence, for some companies, a laissez-faire leadership style indeed might be contraindicated. The cases mentioned above prove that the laissez-faire leadership style motivates employees to work harder (Chaudhry & Javed, 2012).

From the written above, it might be inferred that a leadership style matters because it might either lead to the success of a company or undermine its productivity.

References

Agotnes, K. W., Skogstad, A., Hetland, J., Olsen, O. K., Espevik, R., Bakker, A. B., & Einarsen, S. V. (2020) ‘Daily work pressure and exposure to bullying-related negative acts: The role of daily transformational and laissez-faire leadership’, European Management Journal, pp. 1-11.

Alghazo, A. M., & Al-Anazi, M. (2016) ‘The impact of leadership style on employee’s motivation’, International Journal of Economics and Business Administration, 2(5), pp. 37-44.

Buble, M., Juras, A., & Matic, I. (2014) ‘The relationship between managers’ leadership styles and motivation’, Management: journal of contemporary management issues, 19(1), pp. 161-193.

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Chang, H. (2017) ‘Does leadership matter? Study of leadership style, job performance and job satisfaction’, Poslovna Ekonomija, 11(2), pp.1-28.

Chaudhry, A. Q., & Javed, H. (2012) ‘Impact of transactional and laissez faire leadership style on motivation’, International Journal of Business and Social Science, 3(7), pp. 258-264.

Skogstad, A., Einarsen, S., Torsheim, T., Aasland, M. S., & Hetland, H. (2007) ‘The destructiveness of laissez-faire leadership behavior’, Journal of occupational health psychology, 12(1), pp. 80-92.

Tao, J., Jiang, W., Liu, C., Yang, X., Zhang, W., & Zhang, H. (2017) ‘New employee intention to leave and consequent work performance: Does leadership style matter?’, Social Behavior and Personality: An International Journal, 45(10), pp. 1707-1721.

Weston, S. (2018) ‘Does leadership style matter?’, CIO. 

Yang, I. (2015) ‘Positive effects of laissez-faire leadership: Conceptual exploration’, Journal of Management Development, 34(10), pp. 1246-1261.

Zareen, M., Razzaq, K., & Mujtaba, B. G. (2015) ‘Impact of transactional, transformational and laissez-faire leadership styles on motivation: A quantitative study of banking employees in Pakistan’, Public Organization Review, 15(4), pp. 531-549.

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StudyCorgi. (2022, November 5). Why Is Leadership Style Important for a Company? Retrieved from https://studycorgi.com/why-is-leadership-style-important-for-a-company/

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