AbstractDespitethe common belief that greater worker participation in decision‐making in industry will increase productivity and worker job satisfaction, the empirical evidence has been most contradictory. As a result, theories have been developed which now suggest that the degree of participation should depend on the particular problem or situation facing the leader.For the practising manager the problem has been the identification of the situation and the subsequent selection of an appropriate decision method. One answer to this problem is the Vroom and Yetton model which gives explicit directions to the leader as to how to categorize the problem and select the appropriate decision method.This paper describes our research to examine the external validity of this model.The sites chosen for the research were forty‐seven owner‐operated, small, non‐unionized, franchised firms, where the leaders had the power and authority to effect organizational outcomes. On these various sites, there was relatively high similarity with regard to the technology employed, tasks performed, number of levels of hierarchy and the external environments.It was found that those leaders who were in high agreement with the Vroom and Yetton model had workers with higher productivity and higher satisfaction with supervision than those leaders who were in low agreement with the model.These findings give strong support for the Vroom and Yetton model. The implication of these findings on the training and selection of managers, and on further research, are di