The most effective leadership styles for various types of businesses

ASSIGNMENT

BY____________________
 The most effective leadership styles for various types of businesses

TABLE OF CONTENTS

INTRODUCTION:

Leadership styles have been studied for decades and many types have been identified,
but in essence, leadership boils down to two different styles: task-oriented and people-
oriented leadership. The former is more focused on getting things done; the latter is more
concerned with how people feel while they’re getting it done. What kind of leader are you?
Do you follow the classic definition of a leader: someone who aims to influence and motivate
employees to meet organizational goals and effectiveness?

Significance of Leadership skill:

Most leaders generally adhere to one or two preferred styles of leadership with which
they feel comfortable. But the challenge is that great leaders have multiple leadership styles
in their toolkit, and they are adept at diagnosing situations and using the right leadership
styles at the right times, according to David Jones, professor of management at the University
of Vermont Grossman School of Business.

The interplay between the two styles has created literally dozens of other identified
leadership styles, but I think it’s most useful to look at the three basic variations first
identified by psychologist Kurt Lewin and a group of researchers in 1939.

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 The most effective leadership styles for various types of businesses

1. Autocratic
The ultimate task-oriented leadership style, autocratic or “command and control” leaders
operate in an “I’m the boss” fashion. They provide clear expectations and directions to
employees, telling them what to do and when and how to do it. Autocratic leaders make
decisions on their own without input from the rest of the group.

Good for: urgent situations where results must be accomplished quickly; situations where the
leader has far more knowledge than the team; new employee training

Bad for: creative or knowledge-based jobs; often damages employee morale, initiative and
loyalty

Example: Steve Jobs is the rare example of an autocratic leader whose leadership style
encouraged creativity—although only within his particular parameters. 

This leadership style is one entrepreneurs can easily fall into without being aware of it. After
all, if you start a business because you want to do things “your way" (as many of us do), and
you’re impatient with employees who don’t feel your business’s needs as urgently as you do,
it can be hard to listen to others. In addition to alienating workers, the autocratic approach’s
other main weakness is that it can become hard for the team to imagine functioning without
you. 

2. Delegative
At the opposite end of the spectrum, the ultimate people-oriented leadership style is
delegative or laissez-faire (“let it be”) leadership. In this style, the leader doesn’t provide
much direction; instead, decisions are made by the group. For most entrepreneurs, this
method of leadership can be hard to even imagine—we tend to be very take-charge people
who have strong opinions and want fast results. However, as interest in more supportive
styles of leadership grows, some leading companies have explored adding more delegative
leadership.

Good for: highly motivated, highly skilled or expert employees

Bad for: situations demanding quick results; new or untrained employees; employees who
refuse to take responsibility; employees who need guidance; employees who can’t agree

Example: The "holacracy” system Tony Hsieh is implementing at Zappos is an example of

Delegative approaches can work for small groups within organizations who don’t need to
achieve results quickly—for example, if you have an R&D team. It’s also possible to be
delegative with your key managers, then have them lead their own teams in a more middle-
of-the-road style. However, the delegative approach can be problematic for a small business
hoping to compete in a crowded market. Ironically, you can also expect pushback from
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 The most effective leadership styles for various types of businesses

employees, since many people feel lost without traditional leadership. 

3. Democratic or Participative
A blend of the task-oriented and people-oriented leadership styles is known as democratic or
participative leadership. The leader provides guidance and direction, but also encourages
feedback from employees and takes their opinions into account (although he or she makes the
final decisions).

Good for: encouraging loyalty; boosting employee morale; improving work, product quality
and creativity

Bad for: urgent situations where fast response is needed

Example: Bill Gates is frequently cited as an example of a democratic leader. Gates gave his
people, particularly management, a lot of autonomy and listened to their insights. As a result,
Microsoft has continued to operate successfully even though he is no longer involved day-to-
day.

Democratic leadership incorporates a lot of positive qualities, such as a leader who is actively
involved in the business and who empowers employees and encourages team spirit. However,
be wary of letting democratic leadership drag your team down to the “lowest common
denominator.” Democratic leadership can sometimes dilute your brand and make it more
generic. Remember, you’re still the leader, so you shouldn't hesitate to make the final
decisions even if your team disagrees.

That brings up another key facet of leadership style: Sometimes it’s situational—and needs to
change to match the circumstances. From the leadership styles above, I’m sure you can
identify one that feels natural to you (if not, ask someone who works with you closely). Once
you’ve done that, make an effort to incorporate a little bit of the other two styles into the way
you work—not all the time, but in appropriate situations. Because if there’s one leadership
quality that’s needed most in today’s changing business world, it’s flexibility.

Read more articles on leadership. 

There are 8 most effective leadership styles

An effective leader is the first and foremost condition for a successful business. The hugely
successful leaders adopt a combination of multiple leadership styles or just one selective
style.

As a fluid practice, leadership is always changing and improving the way the company
grows. There are different types of leadership styles exist in a work environment. The culture
and vision of an organization determine which one is the most suitable style.

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 The most effective leadership styles for various types of businesses

Types of Leadership Style

1. Transformational Leadership
One of the most effective leadership styles is the transformational leadership style.
Transformational leaders inspire their staff through effective communication and
collaboration and thus initiating the path to success. They set challenging goals and higher
expectation from each employee eventually achieving a greater result.

These individuals are often blue-sky thinkers. For the successful implementation of their
strategic visions, the organization might need more detail-oriented managers.

2. Democratic Leadership
Democratic leadership is another highly effective leadership style. Often known as
Participative leadership, in this style the leaders often ask help and collaboration from their
subordinates.

This leadership usually reports higher levels of job satisfaction and the company can benefit
from individualistic creativity. However, this style involves more than one individual in the
decision-making process which makes the process slower.

3. Laissez-faire Leadership
The term ‘laissez-faire’ literally means ‘let them do’ in French. In leadership, this is typically
translated to ‘let it be’.

In this leadership style, the leader allows the employees to make decisions. Laissez-faire
leaders are known for their hands-off approach which is often criticized for poor role
definition for managers.

Such leadership style is effective in creative jobs and workplaces with experienced
employees. However, active monitoring of performance and effective communication
regarding the expectation from the leader’s end is must to get the most out of this style of
leadership.

4. Transactional Leadership
Transactional leadership is basically focused on group organization, establishing a clear chain
of command and implementing a carrot-and- stick approach to management activities.
According to Boundless.com, transactional leadership includes: clarifying what is expected of
followers’ performance; explaining how to meet such expectations; and allocating rewards
that are contingent on meeting objectives.

5. Autocratic Leadership
As the name suggests, the autocratic leadership style is the extreme version of transactional
leadership. Autocratic or authoritative leaders take control of the staff and rarely accept or
consider employees’ views or suggestions. Ruling with an iron fist is rarely appreciated by

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 The most effective leadership styles for various types of businesses

staff, which can lead to high turnover and absenteeism. Autocratic work environment rarely
has any flexibility.

6. Strategic Leadership
Strategic leadership is a commonly effective leadership style. This leadership style involves a
leader who is essentially the highest authority of the organization. Strategic leaders are not,
however, limited to the top authority of the company. They include a wider audience at all
levels who want to create a high- performance life, team or organization. This is because of
this approach this is one of the most desirable styles of leadership.

7. Bureaucratic Leadership
Bureaucratic leadership models are most suitable for highly regulated or administrative
environments, where adherence to the rules and a defined hierarchy are important. In this
leadership style, the leaders set a strict set of rules, regulations, and policies which they
follow precisely, and they expect their teams to follow the line.

8. Charismatic Leadership
A tinge of resemblance is evident in both charismatic and transformational leadership. Both
the leadership styles rely heavily on the positive charm and personality of the leader.

However, this style of leadership is seldom considered to be effective because the success of
projects and initiatives are closely linked to the presence of the leader

WHICH STYLE IS BEST FOR BEING AN GOOD MANAGER

The answer is any of them. The kicker is knowing when they're useful and positive, and when
they aren't.

Managers with expert employees will likely do best as persuaders, consultors or listeners.
Higher-skilled workers or those with specialized knowledge generally want to be heard,
hence an autocratic style will only frustrate them. At the same time, so will democratic and
laissez-faire styles. These employees don't want to spend an inordinate amount of their time
deciding on things – they want to be working.

Managers with unskilled and semiskilled workers may do well as autocrats or consultors.
This is particularly so when employees are new. They want to hit the ground running and be
working.

For managers with a small staff, democracy could work well. If there are only three people in
an office, then buy-in is a must. For managers with a very large staff, or managers of
managers, listening can work well. These are the people near the top of the organizational
chart.

The best managers glide from one style to another, depending on the situation.  The
persuasive manager can and should turn into an autocrat during a crisis, and they should

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 The most effective leadership styles for various types of businesses

become laissez faire or democratic when planning the office holiday party.

For the best managers, doffing one hat in favor of another one should be natural.
Management is a form of communication –you change your communication style when you
are talking with your doctor, your friends, work colleagues and your family.  You should
change your managerial style to suit your employees and circumstances.

Being a good manager is about more than decisions and progress reports and projects – it's
about adapting to the needs of those you lead.

IMPORTANCE OF LEADERSHIP IN BUSINESS

It has been said that without leadership, all other business elements lie dormant. Strong leaders
can help an organization to maximize productivity and achieve business goals, whereas weak
leadership can hurt productivity and put the health of the business in jeopardy. Leadership is not
one blanket characteristic that cures all ills, however, there are many different elements that must
be present for an organization’s leadership to be considered adequate.

It should also be considered that there are many different effective-and ineffective-leadership
styles. Just because one manager is jovial while another is refined doesn’t mean that either style
will be more effective than the other. To rate the leadership capabilities of the managers in your
organization, consider how well each manager does the following.

Provides Guidance

Managers should be able to provide meaningful guidance and advice for employees. If needed,
managers should be able to show employees how to perform their job tasks more efficiently and
effectively. Managers should also be able to provide the support that employees need to grow and
develop.

Motivates Employees

Good leaders motivate employees to work hard and meet organizational needs through one means
or another. Some leaders may inspire employees to work hard, while other managers may cause
employees to fear the consequences of not working hard. Both methods work to drive motivation
and one may work better than the other depending on the manager’s specific style and the culture
of the organization.

Initiates Action

It is critical that leaders initiate action by planning out who will perform what tasks, when the
tasks will be completed, and by what means the tasks will be accomplished. Without a clearly
defined plan to complete business goals and good communication between managers and relevant
parties, an organization will fail no matter how strong the other aspects of managerial leadership
are. Managers should be able to initiate fast action to utilize human resources to complete
business needs.

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 The most effective leadership styles for various types of businesses

Builds Morale and Improves Satisfaction

Good leaders drive employee productivity by building confidence in employees and creating a
positive environment that is conducive to productivity. When employees feel stressed or
distracted, job performance and job satisfaction suffer. When managers build morale, it can help
to improve retention, increase employee job satisfaction, and may favorably impact the bottom
line.

Coordinates Employee Needs and Organizational Needs

One of the most important things that every manager must do in order to be effective is to align
employee needs and organizational needs. Employee talents, interests, and scheduling needs can
all either benefit or detract from an organization, depending on how well a manager works to
align these things with organizational needs and goals. The best managers will find a way to
effectively align each employee’s needs and talents with the organization’s goals.

Delegates Responsibilities

It is possible for leaders to delegate too much and it is possible for leaders to delegate too little.
Strong leaders know what to delegate and what to handle so that the organization is as productive
as possible. Adequate delegation is also necessary for maintaining employee satisfaction, as
employees may take advantage of a manager that delegates too little and resent a manager that
delegates too much.

CONCLUSION

This study examined the relationship of leadership styles to business success. Four
research questions were identified examining the effects of the Full Range Leadership Model 
leadership styles and entrepreneurial leadership style on business success. This chapter
presents a summary of the study, detailing the purpose of this study, the research questions,
limitations, data collection, and data analyses. Conclusions based on the findings are
described following the summary. Based on the findings and conclusions, recommendations
for implementation of the study findings and future research are detailed. This studyexamined
the relationship of leadership styles to business success. Fourresearch questions were
identified examining the effects of the Full Range Leadership Model leadership styles and
entrepreneurial leadership style on business success. This chapter presents a summary of the
study, detailing the purpose of this study, the research questions, limitations, data collection,
and data analyses. Conclusions based on the findings are described following the summary.
Based on the findings and conclusions, recommendations for implementation of the study
findings and future research are detailed

REFERENCES

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 The most effective leadership styles for various types of businesses

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