Leadership, effective leadership, leadership styles, organizational performance

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2. Abstract
An effective leadership is very important for an organization’s success. What is effective
leadership? Who are great leaders? How leadership affects the organizational performance, are
few questions that has been the focus of many studies in the past and this papers also aims to
explore them. The paper focuses on the concept of leadership, the importance of leadership,
different leadership styles, the impact of leaders on employees and organizational performance
and lastly it discusses the characteristics of a great leader.
The paper is based on both the literature review and findings of the data that was collected
through questionnaires and interviews. Total 250 employees from five leading companies of
Pakistan were used as a sample and random sampling technique was used so that there is no
biasness. The finding of the data collected is presented through charts and graphs and the
conclusion is based on both literature review and findings of the data.
Key words: Leadership, effective leadership, leadership styles, organizational performance
Introduction
The business environment has evolve over years and has become quite complex and competitive
and for that reason businesses these days need management that can flexibly react to the
constantly changing environment (Bass et. al., 2003).It is important that a business hire employees
who can positively contribute to the business as well effectively manage the business. A business
has different stakeholders and each stakeholder has its own way of evaluating business
performance; an investor expects high return on their performance, employees expects
satisfaction and rewards, owner expects high profits and customers expects products that satisfy
their needs and wants at a reasonable price (Palus & Horth, 2003).Therefore, as different
stakeholders expect different things from a business, it is very important that the business has a
strong leadership that can effectively manage the business so that it’s perform as per the
expectation of different stakeholders (John Wiley & Sons, 2004).
Literature Review
Leadership is a very important resource for a business. Different experts have come up with
different explanations as to how leadership is an important resource for a business. According to
Shartle (1956), leadership is an act to influence others.Haiman (1951) explains leadership as
process by which other an individual influences, controls and directs the feelings, behavior or
thoughts of other individuals. Moreover, according to Pigon, leadership is a process in which an
individual controls other according to his will, insights and feelings in pursuit of specific cause.
So, it can be said that leadership is a resource for a business that can be used to enable business
to do what it needs do and what it should do (Palus & Horth, 2003).
It is very understand the importance of a good leadership in an organizations (Fisher, 2000).Not
just the organization should ensure that it has good leadership but also the leaders should ensure
that their leadership style is appropriate and is working in the favor of what their organizations

3. want to achieve. When you ask a group of business people that what is effective leadership
according to them or what do they think that an effective leader should do (John Wiley & Sons,
2004). They will most probably come up with the same answers like leaders should make
strategies, they should motivate, and they should set goals and objectives for the business and
should create a culture that help businesses to achieve these goals and objectives (Boyne, Meier,
O’Toole, & Walker, 2006; Osborne & Gaebler, 1992; Pollitt & Bouckaert, 2004). It is true, that a leader
should do all this but how a leader manages to do this may vary from a leader to leader, from an
organization to an organization or from situation to another situation (John Wiley & Sons, 2004).
Leadership Styles
Different leadership styles are used to effectively run an organization. Different leadership styles
are used in different situations and leaders should know which leadership style should be used in
a particular situation (Bass and Riggio 2006).A leader’s leadership style reflects his own
interpersonal leadership style and he may have adopted it to achieve organizational goals and
obejctives.According to Mott (1972), there are three type of leadership; democratic, situational
and multifactor. In democratic approach there is open communication and the effective
participation of members in decision making process. The situational approach takes into
consideration conditional variables that may influence a leader’s action. These conditional
factors include, leader’s positional power, the satisfying character of leader-member relationship
and the number of group assignments ( Rafferty and Griffin 2004). Moving on, according to the
multifactor leadership “task” and “expressive” are two factors that influence a leader’s action.
The task factors include the activities that need to be designed to achieve the set goals and
objectives of an organization and the expressive factors include the activities designed to connect
all members socio-emotionally (Palus & Horth, 2003).
Furthermore, Jennening (1962) has also come up with different leadership styles. According to
her, there are four different leadership styles; autocratic, democratic, bureaucrat, neurocrat.
Several other experts have also come with different leadership approaches. All the leadership
styles highlighted by different experts range from being authoritative to be very free. Hence, it
can be said that leadership styles have three classification (Jennening, 1962).
The first one is autocratic approach.Autotcrat approach gives all power to the leader. A leader
determines all the policies, goals and activities of the organization. Moreover, there is very less
communication between the leader and the employees (Bass and Riggio 2006).He only interacts
during meeting to tell what to do and how to do. Employees under the autocratic leadership are
uncertain about what to do and they just do what they are dictated to do by their leader. The
employees have no say in the decision making process and also have a very dry relationship with
the leader (Epitropaki and Martin 2005). Also, there is structured set of punishment and rewards
under this approach. There is no flexibility, what leader belief is wrong is wrong and the persons
get the punishment for it and what leaders beliefs is worth appreciation is given the rewards (
Epitropaki and Martin 2005).

4. Next is the Democratic Leadership approach. It is also known as participative approach because
it encourages employees participation in the decision making process. Though, the leader makes
the final decision but he makes the decision after gathering all the information from employees.
The leaders gives importance to the employees and develops trust in them which in return
motivates the employees to work more efficiently and effectively. Team spirit and morale of
employees is quite high under this approach (Bass and Riggio 2006. Moreover, the leader using this
approach develops special plans to improve employees’ performance. The employees are given
the authority to evaluate their own performance. It encourages employee to grow and recognizes
achievements (Epitropaki and Martin 2005).
Then, there is free-rein leadership approach. It is also known as hands off approach. Under this
approach the leader has minimal role to play (Epitropaki and Martin 2005). The employees have
the freedom to whatever they feel like doing and they are not given by the leader. Employees
have the authority to set goals for them, make decisions and solve their issues themselves.
Leadership style to be used
Though there are different leadership styles available but the key to effective leadership is that
leaders knows which leadership should be used in particular situation (Morehouse, 2007).It all
depends on the leader. Sometimes a leader has this domination nature and does not believe in
changing his leadership according to a change in situations (Cown and Cown, 2005).
Moreover, the three broad classification of leadership highlighted above have their advantages
and disadvantages and they should be used in accordance with the requirement of the situation. If
we talk about autocratic approach then one thing that is majorly criticized about this approach is
that it doesn’t give importance to employees (Cown and Cown, 2005).The employee morale is
quite low under the autocratic leadership. And for that reason is highly criticized from the last
thirty years. But this also true that autocratic approach is quite useful when there is poor
management in a business. Like when there is no coordination between employees or
departments within the organization or employees are not responding to any other leadership.
And there is need of strict leadership that will make sure that they is discipline and employees do
the work assign to them timely and effectively (Morehouse, 2007).
Moving on democratic approach is one of popular approach use these days. Organizations these
days understand the importance of employees and one of their concerns these days is to how to
motivate and satisfy their employees (Palus & Horth, 2003).Organizations understand that they
need to come up with a leadership that believes in employees and involves them in the decision
making process. Also, these days employees are quite skilled they can positively contribute to
then decision making process. And this is done under the democratic leadership approach. But
yes democratic leadership approach sometimes fails when employees don’t respond to it and
needs a strict leadership to control them( Morehouse, 2007)
Furthermore, the third type of leadership highlighted above was free-rein leadership approach.
This approach is most suitable when there is skilled and experience workforce that doesn’t need
much of guidance and know how to effectively do their work.(Bass and Avolio, 1993).Also, when

5. there are outside specialist and consultant available for employee’s guidance. This type of
leadership is not suitable when employees are not skilled and are inexperienced.
Leadership impact on performance
It is important that an organization has an effective leadership that makes sure that an
organization is working effectively and efficiently to achieve its set goals and objectives. One
thing that is very understand is that an organization cannot effectively and efficiently perform if
its employees are not satisfied and motivated (Mihalcea, 2013).Employees play an important role
in the success of an organization. In fact they are an asset for an organization. In order to get
maximum output from them employees, it is important than an organization make sure that they
have leadership that believes in its employees.
If a leader believes in its employees, this can lead to several benefits for the leader, employees
and organization as well. For a leader, it leads to better relationship with the employees within an
organization. It improves understanding with the employee’s .Even employees feel appreciated
for their work and become more dedicated to their work (Iliescu et al., 2007). This improves
efficiency in the organization. It reduces conflict between the leader and employees but, also by
adopting this behavior leader tend to become more close to employees. Which bring them
together as a team and work more collectively, this is beneficial for companies as this holds the
companies together and brings positivity within the organization (DeGroot et al., 2000).Also, it
drives employees work harder as they feel they are appreciated and are important for an
organization. Furthermore, it bring creativity in the workforce as employees are involved more in
task and discussion, new ideas are shared and new ways of doing task can be initiated which can
lead to better results for the company. By listening more to employees, their need can be known,
also what motivate them. A leader can further work on them as resolve issues within the
organization, leading to less conflicts and time saving. Moreover, by being open to training and
guiding employees, leader can play an important role in modeling employees and train them
according to companies need (Vercelino, 2008).By their experience they can make them learn to
perform better. All this will positively affect the company in performing better and building
stronger workforce. This will improve their efficiency by being more effective at work. Humility
is a trait which can resolve many issues at work specially in reducing employee’s absenteeism
and turnover due to bad treatment at work (Vercelino, 2008).
Productivity is further improved as by listening to employees views many issues are resolved and
conflicts are finished. As those issues are solved, many hurdles are removed from employees to
perform at their full potential, further more by training in being open to help employees, leader
polishes employee’s skills as well, they are taught how to be more efficient and effective within
organization, which eventually leads to better performance (Iliescu et al., 2007). It also removes
the awkwardness between leader and employees as it bring them together, by these employees
get confidence form their leader and perform better, they know they would be appreciated for
good work and they dot need to feel pressurized and its ok if they make mistakes, they should
focus more on work than being panelized for their mistakes. This gives them more freedom at

6. work by democratic approach to leadership as leader adopts humility in their personality. It
boasts employees’ confidence and motivation .Hence; they become more loyal and honest with
organization and work harder, improving productivity for the company (DeGroot et al., 2000).
Moreover, this lead to increase motivation in employees; they become more dedicated toward
their work and perform better, resulting in improved performance and more productivity
(Vercelino, 2008).As employees are involved more, they feel affiliated to the company as well and
work honestly towards it goals as well, by being more humble leader increase the confidence in
employees, by listening more to them, employees gets rid of hesitation to talk to its leader and
work more freely. It also lead to more efficiency as leader are open to train employees and share
their experience, this guides employees to work in the right way and avoid mistakes, which leads
to again better performances for the company (Mihalcea, 2013).By making they feel ok for their
mistakes, employees get rid of the fear of being punished for leader as well and they work more
comfortably. They can be themselves at work and discover their strengths as well. It changes the
approach of working form top bottom to bottom up, which means that employees are involved in
decision making and their opinion are considered in action rather than receiving order from
senior and employees feeling alienated all the time. By this the workforce becomes more familiar
with changes as they adopt more experimental approach at work and are ready for changes. This
approach is practiced as employees are involved in decision and new ideas are generated, hence
work pattern can be changed as well, which ever benefits organization.
Leaders may need many styles
Though, it is true that employees feel more comfortable and perform better under the leadership
that believes in them and motivates and encourages them. But it is also true that sometimes there
is a need of strict leadership just like the autocratic leadership.Becasue sometimes employees
takes too much advantage of a lenient and a friendly leadership. In such cases, it becomes
important for the leaders to become strict so that employees work performance can be improved
Blake and Mouton (1964).
Many studies have proved that a good leadership reflects all leadership styles. The more flexible
the leader is with its leadership style the better it is.if we take example of some successful leaders
then one thing common in all of them is that all of them are quite flexible with their leadership
style. They don’t have style checklist that they follow. Also, great leaders exquisitely sensitive to
the impact they have on other and seemingly shape their leadership style to get the maximum
output from them (Hendel, 2005).For example, they have the talent to understand what exactly is
the problem with their employees is and how can there performance be improved. Also, such
leaders donont generalize and believe that every individual is different and what might work for
one might not work for another. Moreover, they also understand that it is not necessarily, that a
same leadership style works in all situations and they change it according to the need of the
situation (Hendel, 2005).

7. Methodology
This research paper aims to conduct an explotary research on the topic leadership. There has
been a lot of research work already on Leadership and this research papers aims to further
explore it.And for that reason qualitative approach was used. Qualitative approach is perfect for
providing valuable information about a complex phenomenon; it focus on unexpected and unique
events; it highlights the voice of those people who are rarely heard; it conducts explotary
research to develop theries and produce hypothesis and even test them (Omar, 2015).Also, as this
research required the opinions of different stakeholder regarding leadership such as employees,
mangers etc, qualitative approach was the perfect choice (Omar, 2015).
Data collection
Questionnaires and interviews were used for the data collection. Online surveys were conducted
that were filled directly in the Microsoft Excel sheet. The interviews were semi -structured and
consisted of open ended questions and were conducted with the senior managers of the five
leading companies of Pakistan for the purpose of data triangulation and validation.
Sampling technique
The sampling technique was random sampling so that there is no biasness. Five companies were
selected before and to select sample from those five companies random sampling technique was
used. As the sample size was to represent such huge population that consisted of all employees
from all these five companies, random sampling technique was the best and most appropriate
choice for that.
Sample size
Total 270 questionnaires were distributed. Though the sample size was 250 but extra 20
questionnaires were distributes so that in case of any questionnaires wrongly answered the
sample size is not affected.
Findings and Discussions
This part of the paper covers the findings and interpretation of the data that was collected
through questionnaires and interviews.
Fig 1.1

8. What qualities do you think that a leader should have?
According to the findings the three most important qualities that a leader should have is stay
calm under pressure, lead by example and should be inspirational.
FIG 1.2
Which type of leadership approach is most appropriate?
0 2 4 6 8 10 12
courage
Inspirational
visionary
lead by expample
Stay calm under pressure
knowledge expert
Other

9. This pie charts shows that 40 percent of the population believes that there should be mix of
different leadership styles, 30 percent believes that there should democratic, 10 percent believes
that there should be free-rein leadership style and again 10 percent believes that there should be
autocratic.
Which leadership style is most popular?
Fig 1.3
Sales
Autocratic Democratic Free-rein mix of different leadership appraches

10. This chart shows that the most popular and widely used leadership approach is democratic
approach, then is autocratic and then is free-rein.
Do you think leadership affects employee performance?
Fig 1.4
0
10
20
30
40
50
60
70
Auotocrat Democrat Free-rein
famous leadership appraoch
Series 1

11. This chart shows that majority of population believes that leadership has a huge impact on
employee performance.
Conclusion
As the business world has become quite competitive and complex, it has become a necessity for
organizations to have a strong leadership that can manage to run the organization under any
circumstances effectively and efficiently. Leadership is not an easy task. A leader has this
responsibility to effectively run the organization and satisfy all stakeholders. Different
stakeholder have different expectation from the organization.Therefore,it is very important that
the business has a strong leadership that can effectively manage the business so that it’s perform
as per the expectation of different stakeholders.
Moreover, though the experts have come up with different leadership approaches and all they
range from being authoritative to be very free. Hence, it can be said that leadership styles have
three classification; autocratic, democratic and free-rein. Each of these there leadership
approaches have their own advantages and disadvantages and are appropriate in different
situations. But it is believed that democratic approach is the most widely used. Both the literature
and findings of the study supports that.
Furthermore, a lot of studies and even this study states that it is important that leader should
incorporate different leadership styles in his leadership. A great leader is always flexible; he
changes his leadership approach according to the requirent of the situation. Moreover, a great
leader also believes in its people, leads by example, stay calm under pressure and is inspirational.
0
10
20
30
40
50
60
70
80
90
100
yes no
leadership affects perfomance?
Series 1

12. Another very important thing is that a leader has strong impact on an employee’s performace.It is
important that leader understand its employees and handles them accordingly. A leader can
motivate employees and can boost their morale by believing in then and satisfying them which in
return will help the organization with better efficient and effective employees.

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