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Top Leadership Theories to Understand and Apply

Top Leadership Theories to Understand and Apply

Leadership theories are the key to understanding and mastering the art of effective leadership. This blog will help you understand the different types and models of leadership theories in detail. Are you driven to lead? Let us find the answer.

Table of Contents

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What is Leadership?

Leadership is the art of guiding and inspiring a group toward achieving common goals. It involves taking initiative, making decisions, and creating a positive environment. 

Importance of Leadership

Good leadership is really necessary for varied reasons. Let us discuss a few of them below:

  • Guidance and Direction: Leaders provide a clear path, steering their team towards the set objectives and ensuring that everyone is on the same page.
  • Motivation and Inspiration: Effective leaders inspire their team, boosting morale and encouraging their members to perform well. This helps the team function properly and gain heights of success in the future.
  • Decision-Making: Leaders make crucial decisions, tackle challenges, and take the team toward success.

What is a Leadership Theory?

A leadership theory is a collection of ideas and principles that explore what makes a good leader. It guides us through the traits, behaviors, and strategies that effective leaders embody.

In simple terms, it is the study of leadership, an attempt to understand what successful leaders do and why it works. It helps you learn from the experiences of great leaders who have come before you, understanding the principles that make them stand out. Leadership theory is a tool that empowers you to grow, adapt, and eventually become a leader who can make a positive impact.

Leadership theories have evolved over time. The early leadership theories became the stepping stones for contemporary leadership theories. Now let us discuss the early leadership theories and the transformed modern leadership theories.

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Early Leadership Theories

Early leadership theories, like the Great Man Theory and Trait Theory, propose that leaders are either born or possess inherent traits. Let us have a look at these theories in detail.

Great Man Theory

The Great Man Theory suggests that exceptional leaders are born, not made. It highlights the belief that certain individuals possess inherent qualities that make them natural leaders.

Let us have a look at the pros and cons of the Great Man Theory.


  • Inspiration: This theory can be motivating, as it suggests that extraordinary leaders emerge in times of need.
  • Simplicity: It offers a simple explanation for leadership, attributing it to inherent qualities.


  • Exclusivity: It can be exclusive, as it implies that only a select few possess the qualities to lead.
  • Overlooking Context: It ignores the impact of situational factors on leadership effectiveness.

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Trait Theory

Trait Theory explores the idea that specific traits define effective leaders. These traits, such as confidence and decisiveness, are considered inherent. 

Now, let us have a look at the pros and cons of Trait Theory.


  • Identification: It provides a framework for identifying key traits associated with effective leadership.
  • Development: It offers the opportunity for personal and professional growth by emphasizing trait development.


  • Oversimplification: Reductionist in assuming that leadership success is solely dependent on possessing specific traits.
  • Situational Ignorance: Like the Great Man Theory, it may overlook the importance of context in leadership effectiveness.

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Top Key Leadership Theories

Understanding the different leadership theories provides you with flexibility and a sense of awareness to apply one theory or the other in a situation. There are a lot of leadership theories that help leaders transform themselves and the situation they are in. Let us discuss them in detail below. 

Contingency Leadership Theory

The contingency leadership theory is about being adaptable. It highlights the idea that leadership doesn’t have a one-size-fits-all approach. Rather, good leadership depends on the specific context and circumstances. This theory suggests that different situations call for different leadership styles.

For example, a crisis may require a more directive and authoritative approach, while a creative project might benefit from a more participative and collaborative style. The key is for leaders to be adaptable and choose the most appropriate style based on the needs of the moment. 

The elements that can influence the contingency theory are listed below:

Task Structure

  • If tasks are well defined and structured, leaders may lean toward a more directive style.
  • In contrast, ambiguous tasks may prompt a more participatory or flexible approach.

Position Power

  • The amount of authority a leader possesses matters. 
  • Leaders with strong positional power may opt for a directive style, while those with less power might choose a more collaborative approach.

Leader-Member Relations

  • The quality of relationships between leaders and team members is crucial.
  • In situations where relations are strained, a leader might need to be more practical and supportive.

Nature of the Workforce

  • The characteristics and skills of the team influence leadership style.
  • Experienced and skilled teams might thrive with a more theoretical approach, while a less experienced team may require more guidance.

Environmental Factors

  • External factors, like market conditions, can impact leadership.
  • Leaders may need to be more adaptable, whereas stable environments may allow for a consistent leadership style.

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Behaviorist Leadership Theory

The behaviorist theory focuses on the observable behaviors of leaders and how they impact their team. It looks at actions rather than thoughts or feelings. Leaders using this approach believe that behavior can be learned, and they emphasize training and reinforcement to shape desired actions within the team.

In behavioral leadership theory, actions speak louder than words, and the focus is on shaping behaviors through consequences and rewards. The elements that can influence behaviorist theory are listed below.


  • Leaders using behaviorist leadership theory rely on positive reinforcement (rewards for good behavior) and negative reinforcement (removing negative consequences for good behavior).


  • Leaders may use punishment for undesirable behavior, making the consequences clear.

Observational Learning

  • This leadership theory considers how team members learn from observing the leader’s behavior, emphasizing role modeling.


  • Regular and constructive feedback helps in reinforcing positive behaviors and correcting negative ones.

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Functional Leadership Theory

Functional leadership theory focuses on the functions a leader performs rather than just their traits or behaviors. It suggests that effective leadership arises from the leader’s ability to perform key functions that contribute to the success of the team or organization. Rather than relying on a single leader, it emphasizes a collective approach, where different individuals within a group may take on leadership roles based on their strengths and expertise. This theory highlights the importance of task functions, building relationships, and promoting group effectiveness.

The following factors can affect functional leadership theory:

  • Task Requirements: The nature of tasks influences leadership functions.
  • Individual Skills: Leaders use the skills of individuals within the team.
  • Team Dynamics: Understanding and managing group interactions is crucial.
  • Environmental Factors: External conditions impact how leadership functions are carried out.

Management Leadership Theory

Management leadership theory emphasizes day-to-day operations and getting things done efficiently. In this theory, leaders are seen more as managers, ensuring tasks are completed, goals are met, and resources are used wisely. It’s about coordinating and organizing to keep the workflow moving smoothly.

Unlike some other theories that focus on inspiration, management leadership theory is grounded in practicality. It involves setting clear expectations, providing guidance, and monitoring progress. 

It is less about personal charisma and more about strategic decision-making and overseeing the tiny details of the team’s work. The elements that can influence management leadership theory are listed below.

External Environment

  • The world outside the company affects how it is managed.
  • Economic conditions, technology, and culture all play an important role.

Organizational Culture

  • Every workplace has its own vibe and values.
  • This culture shapes how management operates.

Employee Skills and Attitudes

  • The people in the company matter.
  • Their skills, attitudes, and how they work together all influence management.


  • The tools and tech available affect how things get done.
  • Management adapts to new ways of working.

Leadership Theory of Transformation

The leadership theory of transformation involves having a super-inspiring leader who can turn ordinary situations into something extraordinary. It’s all about motivating and elevating the team to reach heights they might not have thought possible. Instead of just focusing on tasks and transactions, these leaders create a shared vision that everyone buys into. These leaders lead by example, igniting passion and commitment. 

The elements that influence the leadership theory of transformation are as follows:

Visionary Thinking

  • Transformational leadership is fueled by leaders who have a clear vision for the future.
  • It inspires and guides the team toward a shared goal.

Inspiration and Motivation

  • Leaders in this theory go beyond just giving orders. They inspire and motivate their team.
  • It’s about creating enthusiasm and a sense of purpose, making people want to give their best.

Risk-Taking and Innovation

  • Transformational leaders embrace risk and encourage their teams to take calculated risks.
  • They create an environment where innovation is welcomed, even if it means making mistakes along the way.

Types of Leadership Theories and Models 

Let us understand the types and models of leadership theories in detail. Each of the below approaches brings a different perspective to the leadership role.

Authentic Leadership Theories

Authentic leadership theory is all about being real. Authentic leaders stay true to themselves. This helps in making genuine connections with their team. This theory was first created and stated by Bill George in his book, titled Authentic Leadership. This book states clearly that being yourself is the key to finding success as a leader.

Transformational Leadership Theories

The transformational leadership theory states leadership as providing inspiration and motivation. Transformational leaders aim to create positive change, encouraging their teams to reach new heights. Transformational leadership aims to encourage and inspire employees so that they innovate and develop new techniques to improve the success rate of a company. This method allows the higher authority to give independence to trusted employees so that they can make certain decisions and come up with new problem-solving approaches. 

Situational Leadership Theories

Situational leadership theory is about adapting your leadership style based on the situation. Flexibility is the key since one size does not fit all. The theory was first proposed by Goleman. He stated that a leader should set aggressive standards and make sure that his employees reach that goal. This approach doesn’t seem to be the perfect one since it might work with competitive employees. But it can create a lot of chaos and high stress levels among some employees.

Servant Leadership Theories

This leadership theory is focused on imagining a leader as a servant to their team. It is about putting others’ needs first. These leaders focus on serving their team, which surprisingly often leads to stronger, positive results. This theory was first coined by Robert K. Greenleaf. He introduced this term in his seminal essay titled “The Servant as Leader.” This is one of the most widely used leadership theories today. It has had a lasting influence on people for more than three decades.

Transactional Leadership Theories

Transactional leadership theory works on the concept that leaders set clear expectations and reward or correct them based on performance. It is focused on maintaining order and meeting established goals. Bass first introduced this theory. He stated that transactional leadership has two main components: management-by-except and contingent reward. He further stated that a transactional leader should rely on management by exception. This means that a leader should take action and intervene only when faced with failure.


Leadership theories offer diverse perspectives on how individuals guide and influence others. From the transactional approach’s emphasis on rewards and penalties to the transformational theory’s focus on inspiration and shared vision, each theory brings unique insights. A successful leader often combines elements of the theories discussed in this blog. Ultimately, effective leadership requires an understanding of flexibility to apply different strategies as needed.

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About the Author

Senior Copy Editor

Aparna is a Senior Copy Editor, who combines a passion for precision with creative flair. With a background in law and market research, she has extensive experience in crafting compelling content, she excels in refining narratives to captivate audiences across diverse platforms.