Determinants of Management Styles in Business and Nonbusiness Organizations

Chitayat, Gideon; Venezia, Itzhak
August 1984
Journal of Applied Psychology;Aug84, Vol. 69 Issue 3, p437
Academic Journal
Bass and Valenzi (1974) postulated that power and information are major factors in determining the extent to which five leadership styles are used and presented a set of hypotheses concerning the way power and information affect these styles. This study set out to test the Bass-Valenzi hypothesis and to analyze the impact, if any, of aggregating data from business and nonbusiness organizations on the results. It found that the effect of power and information was not the same across organizations. In business organizations, direction and power were positively correlated, and in nonbusiness organizations they were negatively correlated. When the samples of executives from both business and nonbusiness organizations were aggregated, no correlation was found between power and direction, because the opposite relationships between the two factors in business and nonbusiness organizations cancelled each other out. The methodological aspects of using aggregate data in tests of the Bass-Valenzi hypotheses, including regression and SSA, are discussed. It is shown that such procedures may cause aggregation bias. This article provides a possible explanation for the negative correlation (that is, contrary to the Bass-Valenzi propositions) between power and direction in nonbusiness organizations and suggests that the Bass-Valenzi hypotheses are more applicable to business than to nonbusiness organizations. It found that senior officials of nonbusiness organizations tend to employ more of the direction style and less of the participation style of leadership than executives in business organizations. The results, however, also indicate that inter-organizational differences in styles are mainly attributable to differences in organizational norms, climate, and structure, and not to differences in power and information. This study also investigated the effect of hierarchical level on the leadership styles of senior executives. It found that the use of participation and delegation styles was positively correlated and that the use of direction and negotiation styles were negatively correlated with hierarchical level.


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