Leadership theory is a discipline that focuses on discovering what makes successful leaders excel at what they do. The main distinction between leadership theory and leadership style is that leadership style falls within the general umbrella of leadership theory. In 1939, a group of researchers led by psychologist Kurt Lewin set out to identify different styles of leadership. Transactional leadership theory assumes that employees are motivated solely by the possibility of reward or avoidance of punishment.
This differs from transformative leadership, which believes that people can be intrinsically motivated or driven to perform for the benefit of a team. Our article on leadership styles explores the common leadership styles that have emerged from these fundamental theories. These include the transformative leadership style, which is often the most effective approach to use in business situations. While there are dozens of theories of leadership and psychology, there are some that are better known.
The resulting theories include shared, collective and collaborative leadership, as well as inclusive leadership. There are also people who lack some of the key traits that are often associated with effective leadership, but still excel in leading groups. Transformational leadership is an important psychological perspective for leaders to study and understand if they really want to influence and impact others. The use of a dominant style in this case tends to deprive employees of rights and contributes to low morale, decreased productivity and low employee retention rates.
On the other hand, situational theory holds that the best type of leader is one who is able to adapt his style to the situation. Transactional or managerial leadership is the opposite end of the transformational leadership spectrum. Leadership theories, which include traits, behavior, contingency, and power, explain why some leaders succeed and others fail. One of the biggest drawbacks is that the transactional style tends to stifle creativity and innovative thinking.
Trait theory stems from the belief that certain personality traits indicate leadership, whether successful or fruitless. It is valuable to recognize the theories and styles of leadership in the company you work for and to understand what you can do to carry out that leadership theory or improve it. Transactional leadership is a system of rewards and punishments, and transactional leadership is regularly used in business. Usually, everyone in the organization uses a leadership style at one time or another during the day.
Lewin noted that laissez-faire leadership tended to lead to groups that lacked leadership and members who blamed each other for mistakes, refused to accept personal responsibility, made less progress and produced less work. Rooted in behaviorism, this theory of leadership focuses on the actions of leaders, not on mental qualities or internal states.