Leadership Styles, Transformation, and Success in the Business World

By Katherine Fry, CEO/President of Mediafy Communications Group

As many individuals with business degrees know, there are nine common leadership styles; transformational, transactional, servant, autocratic, laissez-faire, democratic, bureaucratic, charismatic, and situational. As a business leader, it is not only wise, but arguably essential, to ask oneself, “What type of leader are you?” It is also important to determine what type of leadership style best motivates ones team. Asking these questions not only assists business leaders in adopting successful characteristics for themselves, but it also assists them in selecting effective managers for their teams. Here, we will analyze four of these leadership styles.

Richard Branson

Transformational Leadership

In the marketing world, individuals are encouraged and even required to use their intellect. Websites, digital marketing, and marketing campaigns, all require an open environment that fosters creativity as well as critical thinking. This includes hiring professionals who are able to lead projects without a great deal of supervision, ultimately transforming the company as well as themselves. In order to have transformational employees, a company must have transformational leaders. In short, these are leaders who trust their employees and want them to contribute as well as grow. Company cultures with transformational leadership often provide continuing education to their staff, and reward “thinking outside the box.” Richard Branson is an excellent example of a transformational company culture. An overwhelmingly inspiring individual, everything from his social media to his public appearances oozes with transformation. Arguably, this is why he has been so successful in the business world.

Transactional Leadership

In contrast, transactional leadership is based more on a “carrot and stick” type of approach. In this leadership dynamic, employees must follow a clear chain of command, and not go outside “their lane.” Company cultures implementing this approach reward adherence to the rules, and are punished for breaking them. In public agencies, government, and even schools, the transactional leadership role is predominant. If a student follows the rules, they are rewarded. If they do well on a paper, they get an A. However, what is standard and effective in the public sector, often backfires in the private one. Critics state that transactional leaders do not foster creative thinking, and in fact, often penalize for it. Companies providing creativity to their clients often find themselves stifled by a leader utilizing this approach.

Autocratic Leadership

The autocratic leadership style is often employed by unseasoned business leaders, with little to no managerial experience. With time, and a willingness to learn, this can transform into a more advanced leadership style. However, during an autocratic leadership period, business leaders often display extreme control over their staff, rarely taking suggestions, and rarely sharing power. Companies with autocratic leaders typically have “stressed out” employees, high turnover, and a lack of intellectual stimulation amongst their staff. Business leaders who remain autocratic typically do not remain business leaders for long, because unhappy staff typically flee at the first opportunity. In the marketing world, autocratic leaders must “change or die.” Creative individuals will not stand for it, and non-creative individuals will flee from it. Schooling in management techniques can result in the dissolution of autocratic leadership, but the leader must be willing to change. If the business leader displays an unwillingness to transform their leadership style, the transformation is often made for them, through the business dissolving or being sold to another with more a more advanced leadership style.

Laissez-Faire Leadership

Laissez-Faire leadership or leadership led by “the invisible hand” is one in which employees are allowed to complete their tasks as they see fit. Business leaders who employ this approach have the ultimate task of completed projects, happy employees, and happy customers. However, leaders utilizing this approach realize their are various means “from A to D.” As a result, teams are encouraged to sort out the particulars themselves, as long as the final result is achieved. However, such a leadership style often results in a “double-edged sword”-happy employees but unhappy customers. When staff performance is monitored, productivity and quality can slip, resulting in details “falling through the cracks.” The Laissez-Faire leadership style is often employed by company leaders who view their jobs as a hobby, or who on the verge of retirement. While great in theory, it is very rarely an effective way to run a profitable and successful company. Employees need structure to achieve their deadlines, and structure often disappears in such a laid-back environment. Laissez-Faire leadership is often considered the opposite side of the spectrum from Autocratic; while one is often present at the beginning of a leaders career, the other is often often present at its end. Success is arguably found in the middle.

Conclusion

In closing, there are nine forms of leadership styles and four have been analyzed here. Transformational leaders encourage profit and success through the transformation of their employees and ultimately their company. Transactional leadership, while effective in the public sphere, is not nearly as effective in the private one. Autocratic and Laissez-Faire leaders represent extreme side of the spectrum, and companies as well as individuals often suffer as a result. Quite simply, Transformational leaders are open to transformation, and this leads to more effective leadership, happier staff, and more successful companies.