Saturday, June 14, 2014

June 14

Since several people have recently looked,  here's a revisit to my post from November 23, 2012:

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 that maintains that private initiative and production work best, when people allow them 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 (otherwise mentioned as management) style ranks lowest among the different styles that the associated researchers investigated, as they relate 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 two disciplines of economics and leadership. Where the economics experts have apparently concluded that when left unregulated, people will do those things required to achieve outcomes correlated to their perceived best interests; leadership experts have apparently concluded 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: (a) leaders have not adequately and appropriately developed shared visions, compelling self-interests, and entitlements with and for their subordinates, in order to establish subsequent buy-in and associated levels of organizational citizenship and affective commitment; (b) stakeholders have confused the concept of leadership by hierarchical position with the concept of leadership by functional behaviors. They have thereby mistaken the overall purposes and uses of leadership with those of other competencies, typically emplyed by organizational members in hierarchical positions of authority. Arguably, actual "leaders" need only to appropriately employ leadership competencies, when:

  • No standard procedures exist

  • Selecting standard procedures to use

  • Existing standard procedures no longer result in the desired levels of efficiency and effectiveness that relevant stakeholders require.

During all other situations, those who employ positions of hierarchical authority should appropriately employ other competency sets (diplomacy, influence, management, sales, etc.); and (c) for all of the praise in the literature, heaped upon McGregor’s (1960) Theory Y and the subsequent contempt shown for the associated Theory X; the underlying perceptions (cultural assumptions?) of the cited leadership scholars, includes that, for the most part and at the most basic levels, subordinates prefer to embrace attitudes and employ behaviors associated with Theory X, rather than those associated with Theory Y.

Based on my experiences as a subordinate, I have 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. Therefore, I suggest that a gap exists in the current leadership literature, represented by 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 their supervisors' effectiveness higher than 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 supervisors' effectiveness higher than 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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