How to Lead in Business: Exploring 6 Leadership Styles

From a democratic leadership style centering around creating consensus to the autocratic leader, there has been much research on common leadership styles and how professionals can identify which styles are most suitable for them. Psychologist Daniel Goleman, known for his extensive research on emotional intelligence, suggests that great leadership requires recognizing that the efficacy of any approach depends on the individual circumstances. This article explores six leadership styles, alongside an overview of their benefits and drawbacks.

1. Authoritative Leadership

Often referred to as visionaries, authoritative leaders regard themselves as mentors to their followers. Distinct from authoritarian leadership, an authoritative approach to leadership focuses on offering guidance, with leaders charting a course and inspiring others to follow.

Authoritative leaders motivate and inspire their teams, providing overall direction and motivation. They promote a sense of achievement and accomplishment among colleagues, getting to know the members of their team and lending assistance and feedback on a personalized level in order to help each person succeed. However, the hands-on nature of authoritative leadership requires that leaders take cautions to avoid micromanaging, which team members can find overbearing.

2. Autocratic Leadership

Also known as authoritarian leadership, the autocratic leadership style follows a “Do as I say” philosophy wherein leaders thoroughly establish a vision of the end result and the manner for achieving it. Autocratic leaders outline clear expectations and specific guidelines for how and when tasks should be completed, expecting their teams carrying out their directives promptly and without question.

Autocratic leaders are primarily concerned with achieving efficient results, with a focus on utilizing the actions and solutions they perceive as pertinent to the best interests of the business. This style of leadership is therefore most effective where consistent, predictable results are required, particularly in industries like construction or healthcare with strict regulations.

Quick decision makers, autocratic leaders are adept at managing crises. Nevertheless, since this style of leadership minimizes group input, it tends to stifle innovation and creativity. Its success also relies on leaders earning the trust necessary for teams to feel confident in their leader’s decisions and instructions.

3. Affiliative Leadership

Acting with a “people come first” ethos, affiliative leaders foster emotional bonds to promote loyalty and trust. Affiliative leaders base their approach in sound relationships, focusing on the relations among team members. Highly people-focused and team-oriented, affiliative leaders prioritize enhancing employee trust to build stronger relationships and maintain the overall team connection.

By reducing stress and work-life imbalances among team members and nurturing their wellbeing, affiliative leaders can boost creativity and productivity. This style of leadership requires adept communication and people skills.

It is ideal in circumstances where workforce morale is low, during stressful periods, or when conflict arises between team members. However, affiliative leadership does incur the risk of allowing team members’ individual needs to overshadow those of the group as a whole.

4. Coercive Leadership

Coercive leaders deliver directives in a commanding way, eliciting swift and effective action from their teams. This style of leadership is particularly appropriate in high-stakes situations, such as when an important deal for a client is in jeopardy because a shipment has gone missing or when addressing a toxic workplace situation created by an employee necessitates a prompt response.

When such time-sensitive matters arise for a company, coercive leadership enables managers to take swift and decisive action to resolve or sidestep a problem and get the business back on track. Although coercive leadership is a valuable approach in urgent situations, it should not be a business leader’s default setting. Prolonged use of a coercive leadership style can adversely impact employees motivation, causing even the most talented team members to doubt their performance.

5. Pacesetting Leadership

Pacesetting leadership is characterized by maintaining high standards and expectations. Inspiring and demanding, pacesetting leaders emphasize excellence and leverage role modeling to inspire team members. Pacesetting leadership revolves around a “Do as I do, now” mindset, with leaders expecting self-direction and consistent results while pushing team members to maintain high productivity.

A highly energetic leadership style, pacesetting leaders help set the pace by involving themselves in the action. Whether developing a new product or working against tight deadlines, the goal of pacesetting leadership is to drive efficiency and achieve results. Pacesetting leadership is appropriate when a team must meet a crucial deadline, making it ideal in the manufacturing industry and the legal sector.

6. Transformational Leadership

Transformational leadership is rooted in earning the trust and confidence of team members necessary to inspire team loyalty and commitment toward pursing company goals. Transformational leadership not only improves the company’s conventions but also encourages employees to grow and further their own professional skills.

Transformational leaders concentrate on creating a lasting positive impact and empowering team members to reach their full potential in order to drive success for the organization overall. Although leaders need to keep track of short-term results and avoid overlooking operational details while working towards long-term goals, this form of leadership ensures all employees are supported and encouraged.