The history shows that people have tried to explain what actually makes a great leader. Among the many critics, there are few who are often quoted in the history and these authors include Hobbes, Machiavelli, Plato, Lao-Tzu and Confucius. The thoughts of Machiavelli and Lao-Tzu have been quite under the limelight as compared to any of the other political thinkers. Machiavelli thoughts clearly indicate that "power was to be seen as the one and only purpose of leadership"
Borger, a critic, was convinced with the real essence of the message of Machiavelli’s and the foundation underlying his philosophy of leadership as he observed and explained with admiration for the leaders who were able to handle the situations and their followers with power and authority. On the other hand, Borger shows the contempt in his expression for the leader, as suggested by Lao-Tzu, who does not take risks and other steps to deal the situations and rather allow the external factors to guide their decisions. However on the other hand Lao-Tzu was of the opinion that the world must be left to govern itself without any specific leadership. In his work he said that "A good leader is the one who has no specific plans and is not governed by his thoughts rather he lets go of the plans and let the fate take its own course"
There are various authors who consider that the advice by Machiavelli can easily be adopted by the leaders in the modern business environment. This assumption can be difficult to impose because the ideas by Machiavelli and the conditions, which were presupposed, were not exactly meant for the modern world business scenario. The advice of Machiavelli’s was mainly designed for the lawgivers, was meant for the princely ruler who possesses the power, can claim the monopoly exercising powers, and use the force in order to achieve the objectives. While the modern leader in the corporate scenario shows that, they are law followers, thus the philosophy of Machiavelli is not applicable. The modern business world is full of leaders who are mainly dependent on the states to claim their existence and they do not have any power. These leaders are mostly required to comply with the rules that already exist in the business world. Machiavelli was inclined towards more practical ruling aspects rather than ethical or moral since he said that "a ruler must see to the benefits of the state and to maintain that he can break his promises, go against charity, and break religious and humanitarian laws as well" thus it shows that Machiavelli intended to inculcate the practical approach while Lao-Tzu taught that leaders must not impose anything of the followers and should not try to take everything in their control. In his work he said that "to be a great leader, you must be a great follower, so do not control".
Based on the work of Bass, full range of leadership model discusses three major leadership styles. These styles include transactional, transformational and laissez-faire. Transactional leadership has three forms, which includes contingent reward, management by exception- active and the management by exception-passive. Among the three forms of transactional leadership, the management by exception passive is considered as the passive transactional leadership while on the other hand the management by exception active and the contingent rewards combined together are considered as the active transactional leadership or active leadership. Contingent reward leadership mainly involves the development of the expectancies of the employee rewards, which includes their financial rumination and public praise in order to achieve good performance. The active management by perception leadership is characterized by monitoring the subordinates if they deviate from the well-established performance standards. In active leadership, the leaders motivate their subordinates by mostly encouraging them to work on the established performance measures and ensure that their subordinates avoid making any mistakes. Sosik and Jung suggested that by means of active management by exception, the leaders monitor the performance of their followers and when these leaders think there is a need to take corrective actions, they force the followers to change their work and attitudes. The Machiavelli's most significant theme of waging war seems very much evident in the conventional leadership theory. The power of the leader is considered to be based on the knowledge they possess, control and the ability they have to win. The will of the leader is imposed based on the direct or indirect violence threat. However, the industrial world considers violence in terms of economic nature and relates it to the market share acquisition and financial assets. Richard Hill being in favour of Machiavelli’s ideas claims: “That the observations of Machiavelli about the political leadership can be applied to other leadership kinds, most importantly to business leadership”.
Passive management by exception leaders is different from the active leaders as they do not actively look into the performance that might deviate rather wait until the performance has already deviated. Upon the recognition of a performance gap, the leaders take a forward step and intervene. Epitropaki and Martin proposed that the transactional leadership or active leadership promotes the followers organizational identification by means of triggering the self-categorization process of the followers. When the leader gives contingent rewards and actively monitors the performance of the followers for any kind of errors and deviations, they mostly clarify the expectation of the followers related to the norms and values. Theoretically Bass professed transactional leadership or active leadership which has its behavior and thoughts linked to the Machiavelli leadership style to be a less effective leadership form as compared to the transformational leadership style that was suggested by Lao-Tzu.
Lee A. J. A. "World of Ideas", Bedford/St. Martin's; Eighth edition, (2009).