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Leadership Theories and Styles in Clinical and Organizational Settings ​ Henry Oh, PhD, MPM, CLC

Posted By Administration, Monday, June 18, 2018

Leadership Theories and Styles in Clinical and Organizational Settings


Henry Oh, PhD, MPM, CLC




The existence of numerous leadership theories can sometimes be too complex.  Many articles and research papers have been written about leadership theories, styles and practices.  Most of these papers have focused on the applications of leadership in business, politics and education.  Academic papers on clinical leadership have been written mostly for nursing, medicine and public health. This paper presents five (5) of the leadership theories and their applications in allied health. The discussion describes how the Fiedler’s Contingency Theory, Path-Goal Theory, Transactional Theory, Transformational Theory and Servant Leadership Theory, apply to clinical and organizational settings.


Many leaders possess a diversity of skills, competencies or characteristics (Gardner, 2000). There are individuals who are primarily leaders but may also possess managerial skills, while there are individuals who are primarily managers but may also exhibit some leadership qualities. There is also a group of individuals who strongly possess both leadership and managerial qualities.


A clear distinction should be made between a leader and a manager. Generally, leaders influence their followers to pursue specific goals, while managers direct their staff members to complete tasks.


Curt Richardson (2013) differentiates leaders and managers as follows:


Leaders have a unique ability to rally employees around a vision. Because their belief in the vision is so strong, employees will naturally want to follow them. Leaders also tend to be willing to take risks in pursuit of the vision.


Managers, on the other hand, are more adept at executing the vision in a very systemic way and directing employees on how to do so. They can see all of the intricate moving parts and understand how to make them harmonize. Managers are usually very risk-adverse.


Donna Flagg (2016) further describes the differences between a manager and a leader in the following:


Managing requires getting work done.  It requires the management of people and day-to-day organization of logistics, communication, workflow and tasks.  It is making sure that things run smoothly in the same way that moving parts of a machine work together to create a functional whole.


Leading, on the other hand, is about inspiration, having a mission, envisioning a future and being able to communicate it in a way that motivates other people to believe in a purpose – and participate in it. Implicitly, workplace leaders have followers.  Managers technically, don’t.  Not necessarily.

Many research studies have been conducted on several widely popular leadership theories:  Great Man Theory, Trait Theory, Contingency Theories, Behavioral Theories, Transactional Theory, and Transformational Theory. 


Several modifications or sub-categories came forth from these theories.  For example, associated theories that have been developed from the Contingency Theories include: Fiedler’s Contingency Theory, Path-Goal Theory, Cognitive Resource Theory, and Strategic Contingency Theory (


Fiedler’s Contingency Theory in Clinical Practice


Fiedler’s Contingency Theory is one of the leadership theories that have been widely studied by scholars. It is the result of more than 30 years of study by Fred Fiedler and his associates (Kreitner and Cassidy, 2004). 


The Fiedler’s Contingency Theory is situational in nature since “He (Fiedler) showed for example that a leader who is more directive and focused on achieving targets might be a better leader in an unfavorable situation” (Coleman and Earley, 2005).


According to Fiedler’s Contingency Theory:


Effective leadership depends not only on the style of leading but on the control over a situation. There needs to be good leader-member relations, task with clear goals and procedures, and the ability for the leader to mete out rewards and punishments ('s-contingency-theory.html).


Clinical situations where Fiedler’s Contingency Theory would apply:

·        Leading a code blue team in cardiopulmonary resuscitation (CPR) to ensure that established guidelines are followed

·        Supervising laboratory personnel in performing laboratory procedures to ensure a timely report and accuracy of laboratory results

·        Directing and coordinating an emergency response team during trauma or disaster

·        Directing and coordinating the daily operations in a complex medical office


Working in a clinical setting can be stressful and overwhelming especially during emergencies, when there is a high volume of workload, and complicated further with staff shortage.  A manager or supervisor must take the lead to identify priorities, assign workload, find resources, and keep the situation under control.  The leader can effectively monitor the needs of the unit or department when the situation is under control.  


First and foremost, the safety of the patients is the goal. When patient safety is compromised, the leader needs to correct the situation.  A compromised situation can include equipment malfunction, shortage of supplies, error in the procedure, incompetence of staff, inefficient operations system, delays, late reports, and conflicts.  Any of these situations is critical to patient care. Fiedler’s Contingency Theory emphasizes control over situation, and tasks with clear goals and procedures.  This theory appropriately applies to leadership in clinical practice.


Fiedler’s Contingency Theory and Authoritarian Leadership Theory


Leadership in the workplace involves various styles along a continuum. The continuum ranges from a highly authoritarian leadership role style, in which the leader makes all decisions and tells followers what to do, to a highly democratic leadership style, in which the leader and followers discuss problems and jointly make decisions that affect their work.  The style that is most effective depends on the nature of the situation and the needs and characteristics of the followers. 


In stressful work situations that require rapid and highly efficient job performance, productivity and satisfaction are more likely to be maintained under authoritarian leadership.  Employees recognize that the nature of their work does not allow time for a participative approach.  For example, firefighters must respond to a fire alarm immediately and follow the directions of their chief. They do not have time to hold a committee meeting to determine the best way to deal with the fire.


Transactional and Transformational Leadership in the Clinical Setting


It is essential that anyone, whose goal is to become a manager in a medical office or department, or a leader in a clinical division that oversees several departments, know the differences between the transactional and transformational leadership styles.  To be effective in meeting the goals of a department or division, and in leading a team of healthcare staff, an individual needs to figure out which leadership style works in the best interest of the department, the division and the subordinate employees.


Transactional leadership refers to leading an organization where tasks must get accomplished through transactions such as “rewards and punishments.”  “It is transaction in the form of reciprocity, the idea that the relationship between leader and followers develops from the exchange of reward, such as performance-based pay, bonuses, promotion, recognition, and praise, in return for work well done” (Kippenberger, 2002).


In the clinical setting, “rewards” may include weekends off, more day shifts than night shifts, reimbursements for membership fees, attendance at seminars, continuing education, complimentary meals, promotion, salary increase and other incentives. In contrast, “punishments” mean no incentives earned. It is entirely based on transaction conducted between a manager and staff members.  The clinical manager is primarily concerned with the daily operations of the department. 


Schultz and Schultz (2006) describe transactional leadership as follows:


Transactional leaders focus on increasing the efficiency of established routines and procedures and are more concerned with following        existing rules than with making changes to the structure of the organization.


Transformational leadership involves influence by a leader on subordinates, but the effect of the influence is to empower subordinates who also become leaders in the process of transforming the organization (Muchinsky, 1997).


According to Kippenberger (2002):


Transformational leadership, on the other hand, is more about hearts and minds empowering people rather than using rewards to control them.  Because transformation means change, such leadership is seen as releasing people to learn, to seek change and improvement.  So it is based on trust on the part of the leader and understanding, skill, dedication and commitment on the part of the followers.


Transactional leadership is best suited for supervisors and middle managers who run the daily operations of the department.  They are responsible for the smooth operations of the departments.  Laboratory managers, shift supervisors and section heads are examples of transactional leaders who ensure that laboratory staff members perform their duties and responsibilities in the processing of specimens and reporting of laboratory results in a timely manner. 


Laboratory managers are also transformational leaders who develop strategic plans and visions to lead the department into a higher level of complexity in laboratory diagnostics and technological advancement. Division managers are those individuals who oversee two (2) or more allied health departments that may include laboratory, radiology, respiratory therapy, and other related units.  Division managers need to be strong transformational leaders who can empower their subordinates to improve further the quality of service of their departments, as well as their own professional development.


David Ingram (2017) describes in a more practical way both transactional and transformational leadership styles below:

A transactional leader generally does not look ahead in strategically guiding an organization to a position of market leadership; instead, these managers are solely concerned with making sure everything flows smoothly today. A transformational leader goes beyond managing day-to-day operations and crafts strategies for taking his company, department or work team to the next level of performance and success.            


Path-Goal Theory and Servant Leadership Theory in Organizations


Path-Goal Theory is a derivative of expectancy theory where followers would be motivated if they feel competent, if their efforts are rewarded, and if their work is valued or appreciated (Northhouse, 2016). Path-goal theory assumes that effective leaders can enhance employee motivation by clarifying work goals; having meaningful reward with goal attainment; and guidance on how goals and rewards can be attained.  Basically it means that leaders should motivate their followers by providing clear goals and guidance on how to achieve them. The key here is motivation.


An important aspect in the application of the Path-Goal Theory is identifying the needs of the followers or subordinates.  As Northhouse (2016) pointed out, “…followers who have strong needs for affiliation prefer supportive leadership because friendly and concerned leadership is a source of satisfaction. For followers who are dogmatic and authoritarian and have to work in uncertain situations, path-goal theory suggests directive leadership because it provides psychological structure and task clarity.” 


Servant leadership originated from Robert Greenleaf in 1970 when he introduced the empowerment movement (Kippenberger, 2002). The individual practicing servant leadership develops the followers’ full potential by providing a comfortable environment where they feel free and so they can accomplish better.  The servant leader puts the needs and concerns of other people first to help them grow, improve and work towards their goals. The servant leader’s approach is to serve others first.  Servant leadership is effective when the leader has a strong motivation and deeply interested in helping others or followers who are open and receptive (Northouse, 2016). Followers achieve greater self-actualization.  Maslow’s Humanistic Learning Theory puts self-actualization in the highest Hierarchy of Needs (Bastable et al., 2011).


Organizations, associations, societies and other groups would benefit from the principles of Path-Goal Theory and Servant Leadership Theory.


The Future of Organizational Leadership


The success and continuity of an organization depends on the effectiveness of succession planning and the availability of highly-motivated individuals interested to lead the organization.


Every organization must have a leadership development plan in place to ensure the continuity and smooth operations of its divisions or departments.  According to Cascio (2011), “Research shows that planning for leadership succession should be part and parcel of the way a company is managed. Grooming potential leaders is a process that takes years…The best organizations are consciously strategic in their leadership planning.”


The most common challenge to succession planning is retirement or resignation of a leader without anyone better prepared and trained to step in.  As Groves (2006) adds, “US workforce statistics suggest that succession planning poses an incredible challenge as the baby boomer generation retires and far fewer college-educated workers are prepared to replace them.” 


To help individuals who have the potentials to become future leaders, training and mentoring are integral or essential to effectively develop the next generation of leaders. The younger generation should be provided with the tools and resources that would give them exposure to leadership theories, styles and practices, and encourage them to move toward those models suitable for them.




Bastable, Susan, et. al. Health Professional As Educator.  Massachusetts: Jones and Barlett

Learning, 2011.


Cascio, Wayne. Leadership Succession: How to Avoid a Crisis. June 2011. 21 June 2017.



Coleman, Marianne and Peter Earley. Leadership and Management in Education. New York:    Oxford University Press, 2005.


Curt, Richardson, Are you a Leader or a Manager? There’s a Difference. June 2013. 19 February

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Dubrin, Andrew. Essentials of Management. Ohio: South Western Cengage Learning, 2009.


Flagg, Donna. The Difference Between Managers and Leaders. Psychology Today. August 2016.

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Gardner, John. On Leadership. New York: The Free Press, 1990.


Groves, Kevin. Integrating Leadership Development and Succession Planning Best Practices.

March 2006. 21 June 2017. < appliedresearch/content/groves3.pdf>


Ingram, David. Transformational Leadership Vs. Transactional Leadership Definition. 19 February

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Kippenberger, Tony. Leadership Styles. United Kingdom: Capstone Publishing, 2002.


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Muchinsky, Paul. Psychology Applied to Work. California: Brooks/Cole Publishing Company, 1997.


Northhouse, Peter. Leadership Theory and Practice. Los Angeles: Sage, 2016.



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