Management style is a term that expresses the characteristic manner of execution of managerial work of managers in relation to controlled workers. Likert management systems are management styles developed by Rensis Likert in the 1960s where he outlined different styles of management to describe the involvement, roles and relationship of subordinates and their managers in industrial settings. The management systems established by Likert that would be discussed here are Participative and Exploitative-Authoritative.
In the participative system, there is free two-way communication, group decisions are made and there is openness in the feedback. The manager has full confidence in his/her subordinates and he lets them participate actively in the decision-making process in order to promote a workplace where all members equally share information. In turn, the employees feel free to discuss any issue that is related to a job with their superior. Likert argues that the participative system is the most effective form of management within the systems. Free-flowing lateral communication allows workers to become more involved within the organization. Employees have high levels of responsibility and accountability for the organizational goals as all individuals are actively involved in their creation. Employees are motivated through rewards such as monetary awards and trust from management for their participation in the decision-making process. Management also encourages employees create relationships with employees of all levels in the organization and to get involved outside of their occupational roles.
In the exploitative-authoritative system, there is a top-down communication, there is no feedback, there is a use of fear or punishments and the manager decides. The responsibilities lie with the upper management and the people on higher positions in the hierarchy. The subordinates are not involved in the decision-making process as the superior just imposes decisions on a subordinate leaving no room for discussions. Leaders have a low concern for people and use methods such as threats and other fear-based methods to get their workers to conform. Communication is entirely downwards i.e from the superior to the subordinate. This creates lack of communication and teamwork. Management is concerned with the completion of work but ignore psychological concerns of people. Employees are assigned a large work load to complete but work satisfaction, monetary benefits and wages do not accompany the work. Workers are often demotivated due to exploitation by management that uses any means or even threats to get the work done. The superior has no trust and confidence in his subordinates therefore they are not part of decision making processes.