While leadership is the art of motivating people to achieve common goals, a true leader is a person who can influence and guide people towards the achievement of those objectives. Different types of leadership have different impacts on an organisation. A leader must choose the most effective leadership style depending on the situation, which determines the team’s success.
This article will discuss the five most commonly used leadership styles in business management.
Types of Leadership
Let’s look at the different types of leadership and their influence on the success and growth of the organisation.
Authoritarian or Autocratic Leadership
In an autocratic environment, leaders take the call without consulting the rest of the team members. Highly authoritarian leadership can destroy the employees’ morale in the wrong situation. However, autocratic leaders are excellent and effective assets to have in times of crisis, as they can make confident decisions quickly.
The key is to strike a balance between taking command and trusting your team to give their input and feedback.
- Reduces time spent on making crucial decisions
- Clear emphasis on chain of command
- Reduces mistakes in the execution of plans
- Strict leadership may lead to rebellion
- Employee creativity will be sacrificed
- Reduces the group collaboration
Participative or Democratic Leadership
Leaders who follow this style always have value for their colleagues’ opinions. They take most of the decisions based on the open debate conducted within the team, which makes their team members feel appreciated.
That said, democratic leaders may sometimes seem indecisive as they struggle with trusting their abilities to come to conclusions. Learning to make quick decisions under crucial circumstances will help them improve their leadership effectiveness.
- Increases employee job satisfaction
- Encourages employees to make use of their creativity
- Aids in building a strong team
- Time-consuming decision-making processes
- Can lead to poor decisions if employees are unskilled
- Transparency in information shared may lead to security issues
Delegative or Laissez-Fair Leadership
There are two types of laissez-faire leaders. One that gives their employees creative freedom and lets them take their calls and set their schedules. The other set may sometimes seem like they lack control over their teams. Leaders with delegate work best with teammates who can direct or manage themselves. Those employees who need guidance might find it hard to keep up with the team under this leadership.
- Experienced employees can make use of their competence and experience
- Creates a positive work environment
- Creativity and innovation are valued
- Finding it difficult to adapt to changes
- Command responsibility isn’t defined properly
Transactional or Managerial Leadership
For a transactional leader, order and systems are of great importance. They set targets for every team member and decide rewards or penalties based on how far they succeed in achieving those targets. Although this process suppresses creativity and ingenuity, the strong emphasis on procedure calls for a high degree of control over operations, resulting in predictable and reliable outputs. One can achieve increased performance and productivity under this leadership as long as the team understands the give-and-take nature of this bond.
- Productivity can thrive
- Eliminates confusion in the chain of command
- Creates an efficient system that is easy for both leaders to implement and employees to follow
- Creativity and innovation are minimised
- No value for empathy
- Cultivates followers rather than leaders among employees
Transformational or Visionary Leadership
Transformational leaders use a mix of praise, empathy and enthusiasm to motivate their team members to explore new ideas, improve their outcomes and achieve their goals. Although this kind of soft leadership may appear insincere in larger companies, employees feel empowered under a transformational leader.
- High value on the corporate vision
- High value on relationships
- Lower employee turnover rate
- Requires constant feedback
- Can lead to deviation of protocols
- Executing tasks would need approval from employees
Familiarising with the benefits of different leadership styles and identifying which will suit you the best prepares you to be a better leader. Today, there are a variety of leadership training courses that can help you better understand these leadership styles and their impact and guide you to become a more flexible leader.