Explore Business

Leaders exercise their authority in different ways. In doing so, they are said to exhibit a “leadership style”

Leadership styles are essentially about:

  • The way that the functions of leadership are carried out
  • The way that a leader behaves

There has been substantial research into the types and effectiveness of various leadership styles, with the four most common generally accepted to be:

The key features of each of these leadership styles can be summarised as follows:


  • Autocratic leaders hold onto as much power and decision-making as possible
  • Focus of power is with the manager
  • Communication is top-down & one-way
  • Formal systems of command & control
  • Minimal consultation
  • Use of rewards & penalties
  • Very little delegation
  • McGregor Theory X approach
  • Most likely to be used when subordinates are unskilled, not trusted and their ideas are not valued


  • Leader decides what is best for employees
  • Links with Mayo – addressing employee needs
  • Akin to a parent/child relationship – where the leader is seen as a “father-figure”
  • Still little delegation
  • A softer form of authoritarian leadership, which often results in better employee motivation and lower staff turnover
  • Typical paternalistic leader explains the specific reason as to why he has taken certain actions


  • Focus of power is more with the group as a whole
  • Leadership functions are shared within the group
  • Employees have greater involvement in decision-making – but potentially this slows-down decision-making
  • Emphasis on delegation and consultation – but the leader still has the final say
  • Perhaps the most popular leadership style because of the positive emotional connotations of acting democratically
  • A potential trade-off between speed of decision-making and better motivation and morale?
  • Likely to be most effective when used with skilled, free-thinking and experienced subordinates


  • Laissez-faire means to “leave alone”
  • Leader has little input into day-to-day decision-making
  • Conscious decision to delegate power
  • Managers / employees have freedom to do what they think is best
  • Often criticised for resulting in poor role definition for managers
  • Effective when staff are ready and willing to take on responsibility, they are motivated, and can be trusted to do their jobs
  • Importantly, laissez-faire is not the same as abdication

As a generalisation, in most business sectors  there has been a gradual shift away from autocratic leadership. Possible reasons for this include:

  • Changes in society’s values
  • Better educated workforce
  • Focus on need for soft HR skills
  • Changing workplace organisation
  • Greater workplace legislation
  • Pressure for greater employee involvement

BUSS3 Exam Technique Advice

BUSS3 is a tough paper - look through the advice and guidance in these tutor2u resources

Read more ›

Teaching & learning products

AQA BUSS1 Revision Guide

Our 20 page quick revision guide to all the key topics for AQA AS Business Studies Unit 1 (BUSS1). Enables students to cover the all the essential knowledge quickly. Also includes extensive advice on applying the theory to the BUSS1 exam studies.


AQA BUSS1 Worked Answers (2013-2014)

Exemplar A grade answers to the three BUSS1 exam papers in 2013 and 2014


Latest reference

Study notes


Study notes

Business failure

Study notes

Sales forecasting

Study notes

Stock Control Charts

Study notes


Study notes

Peer-to-peer lending