Impact of Leadership Styles on Organizational Performance

Abstract

Leadership is one of the key determinants associated with the success and failure of any organization. Leadership style is the manner in which people are directed and motivated by a leader to achieve organizational goals. This study examines the impact of leadership styles on the organizational performance. The focus was on six major leadership styles -transformational, transactional, autocratic, charismatic, bureaucratic and democratic. This study has provided deep insights about the leadership styles; the democratic, transformational, bureaucratic and autocratic leaderships have a positive impact on the organizational performance, however, the charismatic and transactional leaderships have negative impact on the organizational performance, as it does not provide opportunities and freedom to employees. In this study, both primary and secondary research has been conducted. The primary research has been done using the quantitative approach, with the help of survey instrument, based on a survey questionnaire. The secondary research has been done through the review of previously established literature for achieving the research objectives. The findings suggested that charismatic, bureaucratic and transactional leadership styles have negative relationship with organizational performance. Transformational, autocratic, and democratic leadership styles, on the other hand, had a positive relationship with the organizational performance. It has been recommended that organizations use the leadership style that enhances the capabilities and abilities of the people.