6 Leadership Styles (and When They’re Best)

Great business leaders can inspire, bring out the best in their team, and lead innovation. Certain leadership styles may appear to be better than others, but to be a truly effective leader, it’s important to be able to move from one style to another depending on the situation. By describing the different leadership styles and when they’re most useful, this article will help you improve your leadership skills and get the most out of your team.

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Here are six of the most common leadership styles

1. Authoritarian

This is the management style that probably first comes to mind when you think of a leader. Authoritarian leaders impose expectations and define the desired outcomes. They give clear expectations about what needs to be done, when it should be done and how it should be done. They usually also define the consequences or punishment for not achieving the outcomes. The phrase “Do as I say, or else” sums up this command-and-control style of leadership. There is a clear distinction between the leader and everyone else. Authoritarian leaders make decisions independently, inviting little or no input from their followers.

Advantage: Decision-making is efficient and it produces consistent results.

Disadvantage: It is generally considered to be one of the least effective management styles. No one likes being controlled, so it results in high employee dissatisfaction, high staff turnover and low-quality work, as employees can’t grow and develop in such a rigid environment without the right support. It also completely stifles creativity and innovation.

When it’s best used: However, you shouldn’t write it off completely. This style can be useful when a decision needs to be made quickly, and when the leader is the most knowledgeable person. It can be an effective approach when input from the team isn’t required or agreement among the team isn’t necessary for a successful outcome. It can also be useful when people need clear guidelines. For example, when working with contractors or freelancers – they often don’t require much support, but they do need to know exactly what you expect from them.

2. Transactional

This is quite a common leadership style today. As the name implies, transactional leaders rely on ‘transactions’ to motivate their employees to achieve their objectives. In exchange for achieving (or not achieving) a certain goal or meeting a target, employees are either rewarded or punished. For example, a marketing team might get a bonus for generating a certain number of leads by the end of the quarter. Or an employee could be rewarded with a promotion in exchange for high performance.

Advantage: It’s easy for managers to implement, and employees are clear about their role and what’s expected from them. It can be an efficient way to achieve short-term goals.

Disadvantage: It relies on extrinsic motivation, which tends to wane over time, and it might actually reduce your employees’ intrinsic motivation to succeed in their work.

When it’s best used: Transactional leadership works well when problems are simple and clearly defined. It’s less useful in situations that require creativity and independent thinking.

It can also be an effective style of leadership in crisis situations, where the focus is on achieving certain tasks and clearly defined roles are important.

3. Democratic

This is the exact opposite of the authoritarian leadership style. Rather than ‘Do it now, or else’, you’re much more likely to hear How do you see it?’ from a democratic leader. In the democratic leadership style, also known as participative leadership, the leader offers guidance, but they also participate in the group’s processes and encourage input from the members.

While their decisions are based on the team’s input, the leader still has the final say. Importantly, just like in a democratic political system, each team member has an equal say. From businesses to schools and governments, this management style is adopted in many different areas. In a 1939 study headed by psychologist Kurt Lewin, the democratic leadership style was found to be generally the most effective style.

Advantage: Democratic leadership is often effective because it results in engaged, motivated teams and greater commitment to the organisation. It also allows employees to grow and develop, as it encourages lower-level employees to exercise authority.

Disadvantage: The decision-making process can be time consuming if there are disagreements in the group.

When it’s best used: When you want to encourage creativity and you don’t need to make quick decisions. This style of leadership works well in tech or design companies that focus on creativity and new ideas.

4. Coaching

Collaboration, support and guidance are the defining characteristics of the coaching leadership style. Like the coach of a sports team, the leader tries to identify and nurture the strengths of each team member. Coaching has some similarities with democratic leadership, but the difference is that the former has a stronger focus on growth and the professional development of individual employees. Coaches see people as untapped potential, whose talent needs to be developed. They also focus on strategies that will empower the team to work better together.

This type of leader might build teams of employees with different areas of expertise or skill sets, instead of forcing all employees to focus on similar skills or goals. They aim to create strong teams that respect and embrace each other’s skill sets.

Leaders who coach are visionaries. They have a vision and they guide their team towards achieving it. But they first need to sell their idea and vision to the team by exciting, motivating them and encouraging them to be passionately committed to the endeavour.

Advantage: By creating opportunities for growth and creative thinking, coaching leadership enables personal and professional development.

Disadvantage: It can be quite time and resource intensive and demands a lot of energy from the manager.

When it’s best used: When you want to promote and develop talent from within the organisation. This style would be beneficial in industries with competitive job markets because hiring the right candidates can be expensive and time consuming.

It can also be useful when you as the leader are introducing a new or redefined vision, which has come from you and not the team. To realise the vision, the whole team needs to buy into and believe in it. For this leadership style to work best, the people in the team should be individual contributors and full-time employees.

5. Transformational

This is an agile and growth-focused management style. Transformational managers encourage and motivate their employees to push themselves out of their comfort zones. They are always encouraging their employees to raise the bar for their achievements higher and higher.

What sets transformational leadership apart from other styles is a focus on changing ineffective systems and processes. Hence the name – these leaders are constantly trying to “transform” the way the company does things.

Transformational leadership is often seen as a highly effective leadership style. What makes it so effective? The ability of leaders to motivate and inspire employees and effect positive changes in groups. Effective transformational leaders are emotionally intelligent, energetic and passionate.

Advantage: Research shows that transformational leadership is associated with higher performance and better group satisfaction than other management styles. It has also been shown to improve wellbeing among group members.

Disadvantage: If not used in the right way, this management style can lead to staff burnout. Without the right coaching, managers might fail to get the best out of employees, as everyone has a different way of learning and developing.

When it’s best used: Transformational leadership works best in growth-minded companies because of its focus on organisational change and employee growth. If your company is in a fast-paced industry or you’re expecting a period of change, this style of leadership could be beneficial for you. It will enable your team to be more agile, flexible and innovative, so they can adapt to the changing environment.

6. Laissez-faire

‘Laissez-faire’ is a French term that literally means allow to do. And laissez-faire managers do just that – they allow their team to work on whatever they want with little or no supervision or guidance. Also known as delegative leadership, this completely hands-off approach leaves decision-making up to the group members. Laissez-faire managers expect a certain level of performance from their employees, but they generally don’t actively help or check in with them.

Advantage: Team members are empowered to practise their leadership skills and there is less fear of failure.

Disadvantage: Many consider this management style to be the one of the least effective, as the lack of guidance and vision can leave employees feeling neglected. Without direction and support, team members may feel they’re being pulled in every direction.

When it’s best used: If your team is made up of highly skilled, highly self-motivated and experienced employees. For example, if you’re leading a team of senior leaders, directors or managers. If you’re going to adopt this style, it’s essential that you fully trust the individuals or team to make good decisions. This style of leadership is very rarely used with junior or mid-level teams unless they are making very low-risk decisions.

Laissez-faire leadership can also be advantageous in creative organisations like advertising agencies or start-ups because it promotes independent thinking. If you’re considering adopting this style, make sure you aren’t too hands-off. Take some time to monitor the team’s performance and provide regular feedback.

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