Performance of a work unit depends on multiple variables:

• subordinate effort
• subordinate ability
• organization of work (task structure)
• teamwork & cooperation
• availability of resources
• external coordination of work unit operations with other parts of organization

The leader leads by influencing situational variables

• influencing intervening variables directly (those variables that moderate work effort)
• influence the perceived importance of intervening variables

The leader intervenes over periods of time:

• short periods
• correct deficiencies in intervening variables
• long periods--making the situation morer favorable to leadership & performance by
• influence subordinates to internalize values and beliefs
• develop subordinates skills by selection and training
• implement programs to improve units equipment and facilities
• initiate new products and activities
• form coalitions to gain control over resources
• modify formal structure of unit

In short, the leader influences variables to make the situation more favorable, to develop subordinates to improve performance.
 

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Yukl, G. (1981). Leadership in organizations. Englewood Cliffs, NJ: Prentice-Hall.