Leadership Style

It is obvious that effective leaders can achieve the goals they wanted by influencing on employees or followers. It is also known that leaders have different leadership styles that may make a difference to organizational effectiveness or performance. Leadership style is divided into two parts – transformational leadership and transactional leadership (Bass, 1997).

Transformational leadership style is about people’s growth and development. It concentrates on the value system of employees, on their involvement and their needs. Transformational leaders motivate employees to look at problems from a new viewpoint, support, introduce a vision, stimulate emotion (Bass, Avolio, 1990).

Transactional leadership is more about ‘buying and selling’ between the manager and employee, where employees are rewarded for reaching goals or performance criteria (Trottier, 2008). Transactional leaders inspire subordinates by using of different rewards, corrective actions and rule enforcement (Bass, Avolio, 1990).

Let us discuss a situation where an employee had to manage a large project and create a software solution for managers’ and sales persons’ assessment and certification processes. The certification process, by itself, was represented in seven assessment tools and about 70 competencies. The objective was to automate the whole process and create an immediate reporting system with backup solutions. At first, he did not know from where to start. His manager showed that she believed in his strength. She developed the action plan with him and was continuously inspiring him to reach his goal. She said that after that project he could be proud of his achievements. On the day of the certification start, they had the software ready, as well as the backup solution, in case the tool failed. This is a good example of how transformational leaders behave. They work together with employees, put them in front and continuously develop them; motivate employees and take them to the next level and help to achieve the best results.

Let us discuss another example: a shop manager asked her regional manager to raise the rank of her service center from B to A, in order to increase employees’ salaries. He promised to do that, if they exceeded their KPIs within next six months. In this example, the regional manager was expecting higher performance, in order to provide the desired results. A transactional relationship is when something is done based on the return.

Leadership style has influence on both small companies and large organizations. That influence extends to every employee from intern to senior management. In one word, the corporate culture created by them effects the whole company, its performance, and objectives. Let us assess how different leadership styles affect organizational objectives.

Autocratic style or authoritarian leadership sets a distinct line between managers and employees. These leaders are decision makers and usually make decisions without or little employee involvement. Researches specify that this type of leaders use less creativity. The positive side of this style is that it works when quick decisions must be made with no employee involvement. On the other hand, in the long term employees may feel disconnected and demotivated with its consequences on the organizational objectives.

Participative or democratic leadership is the best option for most organizations. In this case the management offers directions to its departments and also encourages suggestions, feedback, and ideas from all employees. This is the positive side of this leadership style. The opposite side of it is that leaders deal with a large number of workforce, as every employee has input.

Delegative or laissez-faire leadership style is considered as a less effective one, because laissez-faire leaders make decisions infrequently, delegating this responsibility to the group. Teams seldom get guidance, as decision-making is delegated to the trusted employees. The disadvantages of this style are that job descriptions become blurred, employees lose motivation and positivity and become confused.

As we may observe, leadership style has deep and strong effects on organizational culture and, accordingly, on organizational objectives, as employees tend to work as their leaders do and they want to please them. Every organization has its specific culture that affects organizational objectives in a positive or negative way. It often depends on managerial and leadership styles.

There are six leadership styles and effective leaders ought to change them to meet the goals of that moment (Goleman, 2004). Now we will discuss all six leadership styles and the situations in which leaders should use them.

Visionary leaders articulate where a group is going, but not how it will get there – setting people free to innovate, experiment, take calculated risks (Goleman, 2004). This leadership style is best to use when a different direction for the company is needed, because the goal of the leader should be to shift people towards new ideas and challenges.

The coaching leadership style works best with employees, who show initiative and want more professional development. But, it can confuse employees, if they think that it is not a coaching, but a micromanagement (Goleman, 2004). This style proves itself to be very productive, when the leader wants to develop employees, to help them improve their skills and find ways that show the connection between individual and organizational goals. I use this style with employees who are already conscious and competent.

Affiliative approach is particularly valuable when trying to heighten team harmony, increase morale, improve communication or repair broken trust in an organization. At the same time, one should not use only this style, since its accent on group compliment can allow poor performance to go uncorrected. Employees may perceive that ordinariness is tolerated (Goleman, 2004). This style is useful when the leader wants to create harmony, connect people and focus attention on teamwork.

The Democratic style creates a team commitment to the final objectives. It is for situations when the company has unclear direction and a collective knowledge of the group is needed.

In pacesetting style the leader wants employees to do the work better, by setting high standards for efficiency.

Commanding is the least productive, but the most often used leadership style. These leaders often criticize their employees, who often have low job satisfaction. It is only effective in a crisis, when an urgent turnaround is needed (Goleman, 2004).

During my career I met a manager with whom I used to work with pleasure, with high level of motivation and commitment. After having analyzed and compared her with my other managers, I discovered that she had been acting depending on the needs of her team members. She used to choose her behaviour depending on the situation, the requirements of the employees, and the particular challenges facing the company. Do you know which leadership style is yours and how your use of it affects your organizational objectives?

Ashot Sargsyan