Depending on your business, the type of leader you need requires various qualities. While finance tends to be a world of fast-paced decisionmaking and strong orientation, other industries, such as hospitality benefit from leaders who negotiate transactions with their employees.
Let’s recap the 7 main styles of leadership.
- Autocratic leadership
Autocratic leaders, also known as authoritarian leaders, generally have all the power, authority, and responsibility in an organisation. There is rarely input or decision-making on the part of the team or employees; rather, team members are tasked with implementing the leader’s decisions and choices.
This leadership style is very useful in situations that demand quick decision-making and close supervision. In times of turbulence, it can be beneficial to the organisation. However, there are also many pitfalls: the organisation cannot function without the leader, communication may be flawed or lacking, and workers can sometimes feel demoralised.
- Charismatic leadership
Charismatic leadership can transform attitudes and beliefs in employees and others. Having the power to influence and inspire people, and communicate the goals of the organisation generally, helps the company to fulfil its vision.
A charismatic person often has the ability to effect change, as well as inspire people. However, as with autocratic leaders, an organisation can become overly dependent on the leader. Some charismatic leaders ignore the needs or ideas of their employees and are often unable or unwilling to learn from their mistakes.
- Transformational leadership
Much like charismatic leaders, transformational leaders inspire others. However, the leader does not need to be present to effect change, because the leader initiates transformation through the organisation and motivates employees to perform.
Transformational leadership demands a high level of productivity and involvement from employees. While this style can go a long way in effecting real change, it may overuse some employees to the detriment of others. Transformational leaders also risk setting too-high, unrealistic expectations for team members.
- Laissez-faire leadership
Employees of laissez-faire leaders have a high degree of autonomy. These leaders maintain a hands-off approach to managing workers, providing them with the tools they need to do their job without being directly involved in decision-making processes, daily tasks, and responsibilities. However, these leaders still take responsibility for the company’s decisions, even though the power to make these decisions rests in the hands of the employees.
The laissez-faire leadership style can be successful when employees are highly skilled and highly motivated. Workers enjoy independence, which may be appealing to many employees. This type of leadership can have consequences when the leader is uninvolved or takes a passive approach. It can also lead to a lack of unity and cohesion in a team, and projects can go off track without strong oversight.
- Transactional leadership
Transactional leadership stems from the notion that employment and specific projects are a transaction: When an employee accepts a job, she agrees to “obey” the leader and complete the tasks and duties as assigned, and will be compensated for her efforts. Workers are rewarded or punished based on their performance.
Roles are well-defined, and people who are ambitious and respond to a rigid system do well under this kind of leadership. This type of leadership allows short-term projects to be kept on task and completed fast. However, transactional leadership does not allow for much innovation or creativity in employees. It also establishes a rigid structure that may not respond well to change. It tends to work in non-creative and repetitive task roles.
- Supportive leadership
Supportive leaders delegate and assign tasks to employees, but also provide employees with the skills needed to complete the task. They work through problems and issues with employees and offer a high degree of attention and coaching on an as-needed basis. The employee maintains autonomy, but the supportive leader will step in and work through issues and problems with the employee as they arise.
Supportive leaders tend to have compassion and are respectful of their employees, giving employees a sense of value and empowerment. Supportive leadership does have drawbacks. A supportive leader can sometimes take too much responsibility and not recognise the skills of their employees by micromanaging staff.
- Democratic leadership
Democratic or participative leadership means that all or most group members are able to participate in decision-making processes. Democratic leaders emphasise equality and encourage discussion and a flow of ideas.
While democratic tends to be an effective leadership style and has a number of benefits, such as encouraging creativity and fairness, and values intelligence and honesty, there are some drawbacks. Roles are often less well defined, which can create communication problems and failures. Some group members may feel that their contributions are not as valued as others, while those with less experience are often reticent to contribute.
What’s Your Leadership Style?
Most leaders use a combination of styles. Good leaders recognise that at different times different strategies are necessary. To complete an urgent project an autocratic style of leadership might be needed for a team that is usually lead by a laissez-faire manager.
The real question is, are you serving your organisation and your staff well? If your team is not responding well to your style of leadership it might be worth examining your default setting as a leader and perhaps choosing a style that better suits the needs of your business. A true leader knows how to manage themselves, as well as the team they are leading.