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In the 1990s, scientists succeeded in demonstrating the highly positive effects of transformational and charismatic leadership on performance effectiveness, based on a large number of empirical findings. Bass (1985) predicted that this type of leadership would be related to “performance beyond expectations”. This has proved to be true to a very large extent. The so-called “new leadership approach “, however, has not yet succeeded in a close analysis of the interaction and influencing processes between charismatic leaders and their followers. This paper provides such an analysis. After pointing out the main problems with prior theoretical work, we offer an alternative model to help explain the emergence of charisma using social-cognitive and psycho-dynamic theories. Basically, we start from the premise that a focal person may be categorized as a charismatic leader on the basis of evaluative borderline attributes assigned to him or her, which are closely related to characteristics stigmatized by society. These attributes are exhibited consciously or unconsciously by the leader, either by means of social dramatization or by means of social reversion. We then propose a model of charismatic leadership relationships, which deal with both intra-personal and inter-personal feedback processes, based on recent theories of narcissistic behavior. Our overall intent is to help explain and clarify the processes between leadership behavior and the attribution of charisma.

The aim of this chapter is to argue that charisma is a collective representation, and that charismatic authority is a social status that derives more from the “recognition” of the followers than from the “magnetism” of the leaders. I contend further that a close reading of Max Weber shows that he, too, saw charisma in this light.

I develop my argument by a close reading of many of the most relevant texts on the subject. This includes not only the renowned texts on this subject by Max Weber, but also many books and articles that interpret or criticize Weber’s views.

I pay exceptionally close attention to key arguments and texts, several of which have been overlooked in the past.

Writers for whom charisma is personal magnetism tend to assume that charismatic rule is natural and that the full realization of democratic norms is unlikely. Authority, in this view, emanates from rulers unbound by popular constraint. I argue that, in fact, authority draws both its mandate and its energy from the public, and that rulers depend on the loyalty of their subjects, which is never assured. So charismatic claimants are dependent on popular choice, not vice versa.

I advocate a “culturalist” interpretation of Weber, which runs counter to the dominant “personalist” account. Conventional interpreters, under the sway of theology or mass psychology, misread Weber as a romantic, for whom charisma is primal and undemocratic rule is destiny. This essay offers a counter-reading.

The literature on charismatic leadership in organizations has neglected the organizational context in which such leadership is embedded. The purpose of this article is to enrich and refine charismatic leadership theory by linking it to its organizational context. We argue that while charismatic leadership principles and processes potentially apply across a wide variety of situations, the emergence and effectiveness of such leadership may be facilitated by some contexts and inhibited by others. We develop and present a series of propositions linking contextual variable to the emergence and effectiveness of charismatic leadership. Among the contextual variable we examine are the organizational environment, life-cycle stage, technology, tasks, goals, structure, and culture, as well as the leader’s level in the organization and the circumstances surrounding his or her appointment.