He has identified four basic styles of management, termed as systems ranging autocratic to participative.
System No. I:
In this system WOW, little confidence in his subordinates. He does not involve them in decision-making. He uses prize and punishment to motivate the subordinates. Authority is highly centralized in the manager. Management in this system is described as “exploitative authoritative”.
System No. II:
In this system manager adopts what is known as “benevolent- authoritative management style.” He adopts patronizing confidence and trust in subordinates”. He uses a few rewards and occasional punishments to motivate worker. Some participation in decision-making is also allowed. However, most decisions continue to be taken by the manager himself
System No. Ill:
Manager in this system adopts consultative approach’. He has substantial but not complete confidence and trust in subordinates. Broad policy decisions am at’ the top. Specific decisions, however, to be taken at the lower levels also. Thus subordinates are consulted and their opinions valued.
System No. IV:
Manager in this system adopts participative-approach. He has complete confidence trust in the subordinates. He involves the in decisions-making. The rewards are given according to their participation.
Lickert found that the system IV approach is the best approach leaders adopting this system are the most productive and successful leaders. Lickert also maintains that autocratic styles of leadership generate short run increase in productivity to at the expense of long term human assets.
Lickert’s System IV, has got its own limitation Empirical support for the theory has been, generated almost exclusively by Lickert and associates. They have ignored the impact of situational variables on management. According to Koontz and Weibrich, “The research focus of this theory is, on, small group, yet discussion is frequently extrapolated and applied to the, total organisation”.
According to David G. Bowers, “The research has primarily been conductive at lower organizational layer and may not be supported when data from top level managers are separated”.
Moreover, system IV has been applied only in the organisations which were running on profit. The result may thus be attributed to the general prosperity of the organisations. Manager have thus to apply this system with great caution.