Recent world events, such as the "Arab Spring", and history as a whole have shown us that while dictators and tyrants are incredibly effective at gaining power, they are very bad at actually using it. It is a brutal irony that those with the skills to gain power have no idea what to do with it when they have it. This irony sadly continues on into the business world.
Nice Guys Finish Last, but Lead Best
A recent study by the University of Notre Dame shows strong evidence that you are more likely to climb the ladder and make more money if you are basically a jerk (paraphrasing). However, history and common sense tells us that leaders who inspire and motivate instead of bully and repress do the best at growing an organization. Of course, all leaders and managers need a certain strength of heart and tough skin, but too often letting assholes rise to power just means they will bring you down with them.
Fear and Greed Only Goes So Far
A study by MIT shows that jobs which require higher cognitive functions are motivated by autonomy, mastery, and purpose rather than financial incentives. Dictators... er... um... business owners tend to use greed and fear to try to motivate employees because at some level it works. However, as a business evolves and needs more qualified people, such tactics tend to constrict an organization's ability to attract better and more qualified people. Business owners don't realize they have to change their management styles to grow.
Tyranny Has a Short Life, Freedom Is Immortal
What military leaders and emergency managers know is that there are good, short-term uses for tight and precise control. However, what separates a hero from a despot is the quick transition to disperse power once the need has passed. As a business owner starts their company, they have to oversee everything and tend to develop an "if you want it done right, do it yourself" attitude. This attitude is also what keeps small businesses... small. If you want to grow, you have to learn to let others take responsibility and maybe even *gasp* do things more their way.
Evolve Beyond Dictatorship, and Don't Work for Dictators
If you got where you are by handing out orders, punishing subordinates, and keeping people in fear, the reality is that you aren't going to get any farther. If you are working for a dictator, realize that you won't be getting any farther either. Be a leader who inspires and seeks to improve himself as well as others. Work for people who inspire you.