With the trend of globalization, competition on the 21st century’s global economy is complex and filled with challenges. More and more MNCs realize that effective leadership, as a foundation of competitive advantage, plays a crucial role in better performance of the organizations. Both practitioner and theorists thus pay numerous attention to the study of effective leadership in different countries. However, researchers still report noticeable absence of cross-cultural research in the field of the three major Western leaderships study, i.e. charismatic leadership, transformational leadership and transactional leadership. An urgent need raises to further investigate the major Western leadership styles in non-Western contexts.

The study aims to explore the most effective leadership style in MNCs Chinese Subsidiaries and to answer the question “why it differs from the Western world?” through applying the Western leadership theories into Chinese business practices. Eventually, the causes behind these differences have been disclosed and discussed.

By reviewing 18 peer-reviewed articles, the attributes of the three major Western leadership styles are identified. Subsequently, all dimensions of the three leadership styles are ranked in terms of effectiveness and activity. As a result of combining the rank and all the identified attributes, a theoretical model of the three leadership styles is proposed. Based on a multi-case study approach in the Chinese context, the empirical data is collected through semi-structured interviews with five Chinese managers and five Chinese followers. The result of qualitative data analysis suggests that the most effective Chinese leaders’ behaviors belong to the transactional leadership style. With reference to the proposed theoretical model, this finding differs from the Western leadership theories. The study further reveals the major causes that lead to the differences between the Chinese practices and the Western theories. Seven implications were thus concluded.

The study contribute to better understanding the applicability and effectiveness of the Western leadership theory in non-Western contexts, particularly China, and further address the weakness of cross-culture research reported in existing literature. The implications of this study give advice to MNCs that are paying increasing attention to exploring effective leadership style in China.