The Contribution of Leadership Style and Practices to Family and Business Success

Abstract

Based on Dyer's (1986) study of family business cultures, this study derives five approaches to leadership: participative, autocratic, laissez-faireqmission, expert, and referent. It argues that participative, expert, and referent leadership should produce positive outcomes for the business and the family, and high levels of employee satisfaction and commitment. It also argues that autocratic and laissez-faireqmission leadership should be associated with relatively negative outcomes for the business and the family and produce low levels of employee satisfaction and commitment. A study of 59 small family businesses produced the following significant results: participative leadership is positively related to both family and business outcomes as well as to employee satisfaction and commitment; referent leadership is positively related to family outcomes and employee satisfaction; and, unexpectedly, laissez-faireqmission leadership is positively related to employee commitment. Using correlational data as the basis, the paper discusses practices that might promote participative, referent, and laissez-faireqmission leadership.