At some point, whether you are stepping up to lead a project, taking charge of managing a team, or a business owner taking on staff, you will need to define and develop your leadership style. Anyone who tries to say there’s a one-size-fits-all solution is kidding themselves. There are myriad leadership styles. Some good, some terrible. How do you know which leadership style is best for you (and for your team)?

There are 5 common leadership styles:

So what defines them and how effective are they?

Democratic Leadership

A democratic leader is one who will encourage full participation in discussions from their team in order to make the best decisions for the company and its people. Even though they will usually have the final say, their team members appreciate having a voice at the table. It’s an effective leadership style in that it produces high rates of staff satisfaction and retention.
The downside: There can be two possible issues with this leadership style. One is in a time of pivoting and innovation when leaders need to make quick decisions and be highly agile. Consulting everyone on the team isn’t practical and not doing so will cause resentment if this has been the norm. Second is in a situation where the team is sluggish or apathetic and not interested in taking on the responsibility of decision making. Democratic leaders rely on input and participation.

Autocratic Leadership

This leadership style is the polar opposite of democratic leadership. In this instance no one is ever consulted about anything. The leader assumes full control of all decisions made around the company, suppliers, partners and staff. You would have to be a pretty amazing human to pull this off and take your business forward, but even if you could your staff would be disengaged and unmotivated and turnover would be very high. (People, that is, not dollars!) In short, this leadership style should be avoided.

Laissez-Faire Leadership

Despite the relaxed ‘let them do’ vibe about the name of this leadership style, it can actually be incredibly empowering. A hands-off leader inspires confidence, innovative thought, curiosity and – perhaps strangely – collaboration in the right people. Small, agile startups are very well suited to this leadership style when everyone is empowered to drive things forward. At best, a small team with complementary skills and high levels of communication will thrive in this situation. At worst, people will lack focus, not have any clear goals and lose sight of their individual role. It can also cause a situation where a dominant ego will take control of the team in place of any strategic leadership.

Strategic Leadership

This is not an easy leadership style to pull off, because you need to be constantly balancing the business objectives of the company with the needs of its people. It is a very effective style to bring to a company in growth as it ensures sustainability through careful planning. Managing professional development while increasing the bottom line needs high level vision and so this leadership style is well suited to those who can see the big picture and then also develop the micro-level strategies that will drive the company forwards.
Beware: you can’t keep everyone happy all the time!

Transformational Leadership

Some leaders fall into this style accidentally! While focussing on growing their company, they also end up growing the skills and capabilities of their team. This added pressure: role shifts, new responsibilities, expanded product portfolio, etc can cause resentment in staff who thought they were employed to do one thing and end up doing so much more. On the flip side, bright, energetic A Players who are always up for a challenge and are easily bored doing the same tasks day in and day out, will absolutely thrive under this leadership style. Keep in mind: you will need to provide regular up-skilling and professional development courses to equip your high-growth team members or they will burn out.

Whichever leadership style you choose, the best leaders are all situational leaders in that they adapt their style to suit the situation they are facing.