Friday, November 23, 2012

November 23

Laissez-faire -- A French phrase literally meaning "let do;" eighteenth century "physiocrats" first used the term as an injunction against government interference with trade. It later became used as a synonym for strict free market economics. Subsequently, many students of economics have generally understood it to represent a doctrine maintaining that private initiative and production work best when allowed to "roam free," without opposing economic interventionism and taxation by the state, beyond the levels necessary to maintain individual liberty, peace, security, and property rights. In that regard, Keynes (1972) characterized [economic] laissez-faire as meaning "that by the working of natural laws individuals pursuing their own interests with enlightenment in conditions of freedom always tend to promote the general interest at the same time" (p. 274).

Several pieces I've reviewed over the past months have suggested (or cited empirical results) that the laissez-faire leadership (management) style ranks lowest among the different styles investigated, in relation to organizational outcomes. For example, under the topic of "Transactional Leadership," Barbuto (2005) noted that: Bass identified laissez-faire as a key type "... of transactional leadership" and  that "... most conceptualizations of transactional leadership... exclude laissez-faire because it represents the absence of leadership" (p. 26). Barbuto continued by citing how Bradford and Lippitt described "laissez-faire leadership as a leader's disregard of supervisory duties and lack of guidance to subordinate" (p. 27). Barbuto then cited a number of leadership experts who essentially concluded that: "Laissez-faire leaders offer little support to their subordinates and are inattentive to productivity or the necessary completion of duties… From the outset, laissez-faire has demonstrated itself to be the most inactive, least effective, and most frustrating leadership style" and "studies show that policies and practices that reflect non-involvement of supervisors lead to low productivity, resistance to change, and low quality of work..." (p. 27).

Clearly, a dichotomy exists between the traditional uses of the term laissez-faire, as experts have applied it in the disciplines of economics and leadership. Where the economics experts have apparently made assumptions that when left unregulated, people will do those things required to achieve outcomes correlated to their perceived best interests; while leadership experts have apparently made assumptions that when left unregulated, people will not do those things required to achieve outcomes required to achieve outcomes in their organizations' best interests. Why have leadership experts taken this position? I posit they have done this for one or more of at least three reasons, reflected by these positions: (a) leaders have not adequately and appropriately developed shared visions, compelling self-interests, and entitlements with subordinates, in order to establish subsequent buy-in and associated levels of organizational citizenship and affective commitment; (b) they have confused leadership by hierarchical position with leadership by functional behaviors; and they have thereby mistaken the overall role of leadership with other competencies emplyed by members in overall positions of authority. Arguably, "leaders" need only to appropriately employ leadership competencies when selecting standard procedures to use, when no standard procedures exist, or when existing standard procedures no longer result in the desired levels of efficiency and effectiveness. They should appropriately employ other competency sets (diplomacy, influence, management, sales, etc.) at all other times; and (c) for all of the praise in the literature, heaped upon the McGregor's (1960) Theory Y and the contempt shown his Theory X; the underlying cultural assumption remains intact that Theory X still generally applies.

Based on my experiences as a subordinate of having generally: embraced organizational outcomes of the organizations for which I have worked, appreciated most the supervisors who managed my by exception, and maintained as high or higher personal production and quality standards than those of my supervisors; I suggest the following research questions, stated as hypotheses:

H1. Subordinates who perceive the existence of positive personal relationships with their supervisors who employ a laissez faire style rate supervisor effectiveness higher than will subordinates whose supervisors employ the transformational or servant leadership styles.

H2. Subordinates who perceive organizational vision alignment with their supervisors who employ a laissez-faire style rate supervisor effectiveness higher than will subordinates whose supervisors employ the transformational or servant leadership styles.


Barbuto, J. E., Jr. (2005). Motivation and transactional, charismatic, and transformational leadership: A test of antecedents. Journal of Leadership & Organizational Studies, 11(4), 26-40.

Keynes, J. M. (1926/1972). The end of laissez-faire. In Essays in persuasion (pp. 272-294). London: Macmillan.

McGregor, D. (1960). The human side of enterprise. New York: McGraw-Hill.

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