Management Styles (Cambridge (CIE) A Level Business)

An Introduction to Management Styles

• Management styles are different approaches to leading and managing a team or business

• They reflect the behaviours and attitudes of a manager towards their team members and influence the organisational culture, productivity and performance

• An effective manager will be able to use a variety of styles depending on the situation, to achieve the best results for the business

• Four common management styles include:
  

Diagram: Common Management Styles

Managers can adopt a range of styles, including autocratic, paternalistic, democratic or laissez-faire
 

• The choice of management style can be influenced by the business circumstances, as well as the nature and size of the business

Autocratic Management

• An autocratic manager holds absolute power and authority over a business

  • The manager makes decisions without seeking input or agreement from others

  • They typically expect strict obedience and compliance from their subordinates
    

• Autocratic managers often have complete control over the decision-making process

  • They set the direction and goals of the business

  • They do not usually consider the opinions, ideas, or expertise of their team members

  • Their decisions are generally not open to discussion or debate
    

Situations where Autocratic Management is Especially Effective

• Whilst autocratic management may be suitable in certain situations, it can also have drawbacks, including 

• Reduced employee morale as workers have no input into decision-making

• Limited creativity as employees are required to follow strict instructions and are closely monitored

• Lack of input from team members restricts an important source of problem-solving ideas and innovation

Paternalistic Management

• Paternalistic managers assume a 'fatherly' role towards their subordinates, acting in a protective and authoritarian manner

  • The manager makes decisions for employees while also showing concern for the well-being and development of  subordinates

  • The manager takes on responsibility for the welfare of their employees

    • They may provide guidance, support, and resources to ensure the success of their employees

    • Huawei’s Ren Zhengfei is viewed as a paternalist who has shaped the businesses culture with well-defined goals, employee devotion and absolute obedience in return for highly competitive pay and opportunities for staff to buy shares in the company
       

• Paternalistic management can create a sense of security and support among employees, increasing their loyalty and reducing staff turnover
  

• It can also be perceived as controlling and limits creativity and innovation within a business
  
  

• It may create a dependency on managers, which restricts personal growth and professional development among employees

Democratic Management

• Democratic managers actively involve employees in the decision-making process and encourage discussion, though they have the final say

  • Consultation, collaboration, delegation and teamwork are common features of democratic management
    

• This management style is most effective in organisations with skilled, experienced and creative employees
  
  

Evaluation of Democratic Management

Laissez-faire Management

• Laissez-faire managers play a minimal role in directing their business team
  

• They allow subordinates significant autonomy and freedom in making decisions and completing tasks
  
  

• Laissez-faire management is most appropriate where workers are highly skilled and self-motivated and require minimal supervision
    

Evaluation of Laissez-faire Management

McGregor's Theory X & Theory Y Managers

• In the 1960s, social psychologist Douglas McGregor developed two contrasting theories that explained how managers assumptions about what motivates workers affects the style of management they adopt

Assumptions of Theory X & Theory Y Managers

• Holding these assumptions about their workers means that managers are likely to adopt different approaches with their employees

Diagram: McGregor's Theory X and Theory Y

McGregor's Theory X and Theory Y managers adopt different approaches with their subordinates, based on their assumptions about their attitude to work

Theory X and Theory Y Approaches to Management

• Theory X managers closely supervise their employees

  • They provide clearly defined tasks and the promise of higher pay or the threat of punishment as means of motivation

  • They may use autocratic measures, which can result in mistrust and resentment among employees

  • McGregor recognised that this approach can be appropriate, especially where workers lack experience or maturity

  • It is generally inappropriate for employees with more complex motivational needs

• Theory Y managers establish a positive working environment

  • The organisation's objectives match employees' personal objectives

  • They develop a cooperative relationship with employees and allow them freedom to make and contribute to decisions

  • McGregor acknowledged that this theory isn't appropriate in every situation and proposed it as an alternative to persuade managers to adopt a positive mindset when managing subordinates