One of the most important tasks of a business leader is to persuade, motivate, and bring out the best in each employee in pursuit of corporate goals. However, there is no magic formula, which leads to a diverse range of leadership styles.
Most professionals develop their own leadership style based on factors such as experience and personality. In the case of a company, leadership styles are determined by a variety of factors, including its market position, internal organisation, business model, corporate objectives, and trends. Regardless, the leadership style chosen will be critical to an organisation's success or failure.
Below we explore the five most common leadership styles, along with the advantages and disadvantages of each to help you determine which leadership style you identify with the most.
Authoritarian leadership is a leadership style in which a single individual has complete decision-making authority and absolute control over his subordinates. Authoritarian leadership, also known as coercive or autocratic leadership, is frequently used in situations requiring error-free outcomes or quick judgments, as well as situations posing a risk of harm or a lack of time.
- A lower chance of mistakes being made during the implementation of plans
- The chain of command is clearly emphasised
- Authoritarian leadership styles often create consistent results
- The amount of time spent on making crucial decisions can be reduced
- Creativity, innovation and entrepreneurship is often overlooked
- Staff turnover rates increase
- It can lead to a lack of group synergy and collaboration
- Group input is reduced dramatically
Participative leadership is a leadership style in which all members of the organisation collaborate to make decisions. Participative leaders allow employees to express their creativity by coming up with solutions to problems. As everyone is encouraged to participate, participative leadership is also known as democratic leadership.
- It increases job satisfaction through employee motivation
- Employees are encouraged to utilise creativity
- Internal teams are strengthened through collaboration
- Overall organisation productivity increases
- Communication failures can sometimes happen
- Decision-making processes take longer than usual
- Transparency in information exchange might lead to security risks
- If employees are unskilled, poor judgments can be made
Delegative leadership refers to leaders who give their employees more decision-making authority. They may delegate tasks to a few managers or allow each employee to direct their own work. While delegative leaders may not participate in every decision, they frequently provide resources to their teams and are accountable for outcomes.
- Creativity and innovation are highly valued
- Increases cohesion and builds stronger relationships between team members
- There is less chance of burnout and employee satisfaction is higher
- Delegative leadership creates a positive work environment
- Delegative leadership makes it difficult to adapt to change
- It can sometimes lead to a lack of accountability among staff members
- Command responsibility is not properly defined
Transactional leadership is a leadership style that emphasises the use of structure, oversight, and a rewards and punishments system to achieve goals. Transactional leadership does not aim to change or improve the organisation as a whole, but rather to achieve short-term goals while establishing unity and conformity within the organisation.
- Transactional leadership eliminates or reduces chain of command confusion
- It creates a system that is easy to implement for leaders and easy to follow by employees
- Employee motivation and productivity is increased
- Transactional leaders facilitate the achievement of goals
- Innovation and creativity is minimised
- Some employees respond negatively to transactional leadership
- Empathy is not valued
- There can be an over-reliance on the leaders
Transformational leadership is a style in which a leader inspires and motivates team members to affect positive change within a company. This leadership style can boost team morale, spur rapid innovation, improve conflict resolution, reduce turnover, and instil a sense of ownership in a team.
- It leads to a lower employee turnover rate
- Corporate vision is highly valued by transformational leaders
- Employees often have a higher overall morale
- It uses motivation and inspiration to gain employee support
- It is not a coercive approach to leadership
- Leaders are not successful if employees do not agree with their vision
- It relies on leaders having a likable, charismatic personalities
- Consistent motivation and feedback may be necessary
- Transformational leadership can sometimes cause protocol and regulations to be broken