5 Leadership Styles and What They Can Do for Your Business

5 Leadership Styles and What They Can Do for Your Business

Leadership style often refers to the way that a leader, which can refer to anyone who heads a group of people through decisions or activities, uses their authority to achieve their goals. There are many different leadership styles and each of them can affect your business differently.

Some leaders like to have more control over the decisions of the group. On the other hand, some leaders want as little control as possible and would prefer to simply have a final say after everyone’s voices have been heard. Each style comes with its own advantages and disadvantages; the style used to lead a group of people should depend upon the leader’s own personality, the goals of the group, and the culture of a group. Each style affects business differently, and it is in the interest of a good leader to adopt different styles depending on what the situation calls for.

  1. Democratic Leadership

Also called participative leadership, democratic leadership is often touted to be one of the ideal types of leadership, as it can be described as fair and just. In democratic leadership, the leader and their subordinates have the same power over decisions. The direction that the group takes does not come directly from the leader but rather from the collective opinions of all members of the group. In this case, the leader has a final say in all decisions, but the process of getting to this decision is placed upon the collective.

Often, a democratic leader delegates tasks to their subordinates and the subordinates have a say over this delegation. This is because, in a democratic leadership style, communication flows both upwards and downwards, from leaders to subordinates, and vice versa. This often results in a business in which employees feel more satisfied and valued. This can also lead to a sustainable and healthy working environment, as healthy communication is encouraged and valued.

  1. Autocratic Leadership

As a complete opposite to democratic leadership, autocratic leadership centers power solely on the leader. All authority and responsibility fall on the shoulders of the leader, giving them the power to create decisions without consulting any of their subordinates. Once a decision is reached, they will pass down tasks to their subordinates, who are generally not allowed or expected to communicate back to the leader about concerns or compromises. Unlike democratic leadership, an autocratic leadership style only allows for communication to flow downwards, from the leader to their subordinates.

While there aren’t a lot of corporations or businesses that approve this type of leadership, there are still a few leaders with international businesses that flourish under this leadership. It may be because decisions can be acted upon much faster, as a consensus doesn’t have to be reached. However, this type of leadership is often viewed negatively and is considered to be archaic and toxic.

  1. Laissez-Faire

The laissez-faire leadership style is one that is completely hands-off. It is characterized by an almost complete lack of feedback from leaders, with the employees often left in the wind. Under this leadership style, subordinates are often left to work with little to no supervision from leaders and are left to their own devices. This type of leadership is generally thought to be one of the most ineffective and least satisfying leadership styles for employees, due to a lack of direction and expectation. It often leads to low production, lack of control, and increased costs.  

On the other hand, this type of leadership could work for very specific individuals who have a lot of skill and experience in the company. This would make for a highly-efficient company that requires minimal communication between its members so that all energy is directed towards production. However, companies aren’t just made of veterans; employees who need supervision and guidance will feel left out and unsatisfied.

  1. Facilitative Leadership

Facilitative leadership can be described as a modified type of laissez-faire leadership. In a facilitative leadership, the leader varies the amount of interference they exercise over their subordinates depending on how well the group is functioning. If the group is functioning well, the leader will assume an almost laissez-faire leadership style, leaving the group on their own. Once function dips, the leader will begin to take on more direct interference.

This can be a very effective type of leadership for groups with a lot of experienced individuals. It can make sure that their skills and experiences are not hampered by too much interference from the leader, all the while making sure that everything stays on track. In order to make this leadership style effective, the leader has to keep a close eye on the group, monitoring production, satisfaction levels, and regularly offering suggestions to steer the group in the right direction.

  1. Coaching Leadership

As with its name, coaching leadership is often characterized by a more personal and individual approach from the leader. This leadership style doesn’t just lead people, it also includes identifying the strengths and weaknesses of individuals, and working with them in order to improve their weak points and capitalize on their strong ones. Therefore, a leader with a coaching leadership style works very closely with their subordinates, almost to the point that they function more as an adviser than a leader.

This style of leadership is perfect for small groups that produce highly-personal outputs, such as those in the arts or social services. It can make sure that each transaction with clients are authentic, as each person is fully invested in its production. Even for groups in corporate settings, this type of style can also be adapted, as long as leaders are expected to cater to small groups.


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