Brian Chesky and Joe Gebbia, design school graduates in Silicon Valley, had a crazy idea after Gebbia’s roommates suddenly moved out in 2008 and he needed people to fill the empty rooms. The crazy idea? A home-sharing platform now known as Air Bed and Breakfast (Airbnb). By 2017, the company had revenues over $2.6 billion (yes, billion!) and profits of $93 million.2 Through the able leadership of Chesky, the company’s CEO, the company is a success. In 2017, he was named one of Fortune’s World’s Greatest Leaders.3

Let’s begin by clarifying who leaders are and what leadership is. Our definition of a leader is someone who can influence others and who has managerial authority. Leadership is what leaders do; that is, it’s a process of leading a group and influencing that group to achieve its goals.

Are all managers leaders? Because leading is one of the four management functions, ideally all managers should be leaders. Thus, we’re going to study leaders and leadership from a managerial perspective.4 However, even though we’re looking at these from a managerial perspective, we’re aware that groups often have informal leaders who emerge. Although these informal leaders may be able to influence others, they have not been the focus of most leadership research and are not the types of leaders we’re studying in this chapter.

Leaders and leadership, like motivation, are organizational behavior topics that have been researched a lot. Most of that research has been aimed at answering the question: “What is an effective leader?” We’ll begin our study of leadership by looking at some early leadership theories that attempted to answer that question.