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Leadership Styles

Consider the leaders who ignite inspiration within you. Each possesses a distinctiveness, employing diverse styles to accomplish objectives, instigate motivation, and invigorate their teams. The landscape of leadership encompasses a multitude of styles, each capable of leaving a distinct imprint on a company's journey and culture.

Below are 8 of the most common leadership styles. Which style is most reflected in your business?

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1. Democratic Leadership

Referred to as: Participatory or Facilitating Leadership

Democratic leadership embodies a collaborative approach, where decisions are shaped by the input of each team member. While the leader ultimately decides, every employee holds an equal stake in determining the project's course.

Key traits of democratic leaders include:

  • Inclusivity

  • Collaboration

  • Effective communication

  • Empowerment

  • Supportive and empathetic

  • Trust-building

  • Emotional intelligence

Why this leadership style benefits businesses:

This style mirrors the decision-making process often seen in corporate board meetings. For instance, a democratic leader might present decision options to the team during such a meeting, fostering a discussion around each choice before considering the board's feedback or conducting a vote.

How this leadership style enhances team dynamics:

Democratic leadership fosters an environment where everyone is encouraged to engage in all facets of the process, share their perspectives, and trust that their voices will be heard. This inclusivity promotes employee engagement, empowerment, and active participation.

Challenges faced by leaders employing a Democratic style:

Reaching a consensus can be time-consuming and resource-intensive. Additionally, decision-making may be affected as some team members might lack the necessary expertise for critical choices.

2. Autocratic Leadership

Also known as: Authoritarian, Coercive, or Commanding Leadership

Autocratic leadership represents the polar opposite of democratic leadership. In this style, decisions are made solely by the leader without seeking input from subordinates.

Key features of autocratic leadership include:

  • Centralised decision-making

  • Direct and top-down communication

  • Minimal delegation

  • Limited autonomy for team members

  • Emphasis on hierarchy and status

  • Resistance to feedback or criticism

Why this leadership style serves businesses:

Autocratic leaders execute strategies and directives with unwavering focus, making swift and decisive decisions, particularly in emergency or crisis scenarios, where immediate action is imperative.

How this leadership style benefits the team:

This style proves effective when complex decisions don't benefit from additional input, providing clear direction and compensating for any lack of expertise within the team.

Challenges associated with an Autocratic style:

Maintaining such a domineering culture can lead to employee turnover, reducing morale and hindering creative problem-solving. Micromanagement, intimidation, and over-reliance on a single leader are also common challenges.

3. Laissez-faire Leadership

Also called: Delegative or Hands-off Leadership If you remember your high-school French, you'll accurately assume that laissez-faire leadership is the least intrusive form of leadership. The French term “laissez-faire” literally translates to “let them do.” Leaders who embrace it give nearly all authority to their employees and don’t often interject unless the situation calls for it.

Some key characteristics of laissez-faire leadership include:

Limited guidance, direction, and feedback Minimal interference and control High autonomy and freedom Empowerment and trust

Why this leadership style works for businesses:

Laissez-faire leaders make employees accountable for their work. This gives many employees an incentive to do their best work. This type of leader often creates a more relaxed company culture. This makes it a good model for creative businesses like ad agencies or product design. It's also a good fit for a business with a highly-skilled team.

Why this leadership style is good for the team:

In a young startup, for example, you might see a laissez-faire company founder who makes no major office policies around work hours or deadlines. They might put complete trust in their employees while they focus on the overall workings of running the company. Because of this high level of trust, employees working for laissez-faire leaders feel valued. They get the information they need and use their resources and experience to meet business goals.

Potential challenges for leaders with a Laissez-Faire style:

Although laissez-faire leadership can empower employees by trusting them to work however they'd like, there are downsides. It can limit team development and pose a challenge for new or inexperienced employees who would benefit from guidance as they get ramped up.

Roles and responsibilities can also become unclear, and it can build a culture of working in silos where people might work autonomously rather than as a cohesive group. This style can lead to overlooking critical company growth and learning opportunities, so keeping this leadership style in check is important.

4. Strategic Leadership

Strategic leaders sit between a company's primary operations and its growth opportunities. This form of leadership requires vision, competitive awareness, and adaptability. These leaders accept the burden of executive interests but also ensure that working conditions are stable for everyone else. Strategic leaders aim to guide their organisation toward its long-term goals. By utilising this leadership style, you can create a forward-thinking, agile, and adaptable organisation that can thrive in today's dynamic business landscape.

Why this leadership style works for businesses:

Strategic leaders tie plans for growth and strategy to how they manage a team. They ask questions, develop and execute strategies, and consider future growth. This approach supports popular business goals like: Accountability, Productivity, Collaboration, Transparency

Why this leadership style is good for the team:

This is a desirable leadership style in many companies because strategic thinking supports many types of employees at once. Strategic thinking supports many employees at once, so it’s a desirable style for many companies. It encourages visualisation, planning, and making the most of existing resources, and it can motivate employees.

Potential challenges for leaders with a strategic leadership style:

Leaders who work strategically might take on too much and risk thinking too far into the future of possibilities while missing critical present-day issues. It’s important to learn how to delegate with this leadership style and share the weight of decision-making. Compromise, communication skills, and consistent outreach are also essential.

5. Transformational Leadership

Transformational leaders cultivate trust and confidence among their teams, fostering encouragement and guiding employees toward achieving company objectives.

This leadership style consistently challenges existing norms within the company, igniting motivation in employees to enhance their skills continuously.

Ultimately, the objective of transformational leadership is to establish a lasting positive influence, elevate team members to their highest potential, and propel organisational success.

Why this leadership style benefits businesses:

Transformational leaders have the ability to inspire innovative thinking within their teams, driving updates to business processes for enhanced productivity and profitability. Moreover, this approach contributes to elevated employee satisfaction, morale, and motivation.

Why this leadership style is advantageous for the team:

This style of leadership fosters a supportive environment where employees are empowered to explore their capabilities. Upon joining a team led by a transformational leader, employees receive clear goals and deadlines. As individuals progress and achieve these objectives, leaders provide additional challenges, facilitating continuous growth alongside the company.

Potential challenges for leaders employing a Transformational style:

While focusing on organisational goals, transformational leaders may overlook individual learning curves, leading to potential issues of employee burnout. It's imperative for leaders to collaborate with their teams in updating benchmarks to ensure sustainable growth and development.

6. Transactional Leadership

Transactional leadership relies on the principles of reward and punishment to incentivise and guide behaviour. Managers employing this style establish clear rules and standards, closely monitoring employee performance. They communicate that meeting goals will yield rewards, while also conducting additional check-ins or one-on-one meetings if goals are not achieved.

This leadership approach prioritises maintaining the current state of affairs and ensuring adherence to predetermined objectives and standards. It operates under the assumption that teams require structure and oversight to achieve business objectives, driven by motivation through rewards.

Why this leadership style benefits businesses:

Transactional leadership finds favour in enterprise settings due to its emphasis on tangible results, established structures, and systems of rewards or consequences. Additionally, it acknowledges and appreciates employee commitment.

Why this leadership style is advantageous for the team:

Transactional leaders provide clarity and structure regarding expectations, fostering a sense of security among employees who comprehend what is expected of them. Team members also have a clear understanding of the rewards awaiting them upon fulfilling business goals.

Potential challenges for leaders employing a transactional style:

This style prioritises using rewards as motivation rather than focusing on building relationships with employees, coaching, or fostering team morale. Engaging a diverse team can prove challenging, particularly if only certain individuals are motivated by rewards, potentially leading to decreased creativity and a fear of punishment.

7. Coaching Leadership

A coaching leader concentrates on identifying and nurturing the individual strengths of each team member while developing strategies to enhance overall team effectiveness. This style shares similarities with strategic and democratic leadership but places a strong emphasis on the success of individual employees.

A manager employing this leadership style may assist employees in enhancing their strengths by:

  • Assigning them new tasks to explore

  • Providing guidance

  • Conducting meetings to offer constructive feedback

Additionally, they may encourage one or more team members to expand their strengths by acquiring new skills from their colleagues.

Coaching leaders prioritise building trust and fostering robust relationships with their team members. They cultivate an environment of open communication and psychological safety, promoting idea-sharing, feedback-seeking, and collaborative efforts towards common goals.

Why this leadership style benefits businesses:

Coaching leaders actively promote skill development and autonomous problem-solving, contributing to the achievement of ambitious business objectives while fostering a strong organisational culture. Their mentorship continues to add value to the company's long-term vision, even after their departure.

Why this leadership style is advantageous for the team:

This leadership approach motivates employees by providing a supportive team environment that acknowledges each individual's uniqueness, fostering diverse and dynamic teams where each member brings something valuable to the table. This type of leader emphasises high performance, promoting effective communication and leveraging diverse skill sets to accomplish tasks. They also encourage team members to embrace challenges, learn from experiences, and continually enhance their skills and knowledge.

Potential challenges for leaders employing a coaching style:

Developing employees through mentoring requires significant time and effort, and it may not be effective for every individual on the team.

8. Pacesetting Leadership

A pacesetting leader establishes ambitious standards and expects employees to achieve those goals precisely as outlined. They demand productivity and high-quality results, often intervening to ensure tasks are executed correctly and on schedule.

Some characteristics of a pacesetting leader include:

  • High performance standards

  • Leading by example

  • Results-oriented

  • Preference for speed and efficiency

Why this leadership style benefits businesses:

This type of leader sets ambitious objectives with focused determination, providing employees with clear expectations. For instance, pacesetting sales leaders establish and surpass ambitious quarterly sales targets. Additionally, these leaders may collaborate closely with their teams, driving performance improvements and enhancing team morale.

Why this leadership style is advantageous for the team:

Skilled and experienced teams often excel under the guidance of a pacesetting leader. They leverage the talents of motivated and capable team members, infusing a sense of urgency and excitement into goal attainment. Moreover, witnessing the leader's diligent efforts alongside them can be rewarding for team members.

Potential challenges for leaders employing a pacesetting style:

Pacesetting leaders may inadvertently create a high-stress work environment if goals are unrealistic, leading to team overwhelm and demotivation. Such conditions can negatively impact engagement and contribute to burnout, hindering goal achievement and performance. Additionally, a focus on rigid goals may stifle creativity and diversity of thought, preventing employees from utilizing their expertise to propose alternative objectives or strategies.


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