Types of Leadership Styles in Business

Leadership Styles

Traditionally the following leadership styles have been the most popular:

Dictator Leadership – In this leadership style the leader has absolute power and authority over their subordinates. The subordinates receive orders from the leader and they carry them out as instructed. The leader does not allow subordinates to participate in decision making. This is the leadership style that the leader uses fear and threats in order to get the job done. Similar with the autocratic style of leadership the leader also makes all the decisions.

Autocratic Leadership – It has been shown that this leadership style are likely to become dictators. Also under the autocratic leadership style all decision making powers are centralized to the leader. They do not entertain any thought from subordinates and do not listen to any suggestions or initiatives from them. Autocratic leadership provides strong motivation to the leader and this is shown to be true as it has been successful in the past. It is effective as it permits quick decision-making as only the one person needs to decide for the whole group and this individual keeps decisions to themselves until they feel the rest of the group need to know what they are. Autocratic leaders do not trust anyone.

Democratic Leadership – Participative or democratic leadership style favours group decision making as shown that the leader only gives instruction after consulting the group. The leader can earn the cooperation of the group by doing this and therefore can motivate followers effectively and positively. The decisions arise from consultation and participation within the group members first so the decision making is not unilateral such as the autocratic style. When democratic leaders are present in the workplace the leadership style produces a work environment that employees can feel satisfied with the environment of the workplace. Subordinates feel that their opinion counts because of the shared communication and because of that feeling they can become more committed to achieving the goals and objectives of the organization.

Laissez Faire or Free Rein Leadership – A free rein leader allows maximum freedom to subordinates, by leaving the group entirely to itself and does not lead them every step of the way but rather motivates them by trusting the individuals to do things themselves. Subordinates are given a freehand in deciding their own policies and methods. Free rein leadership is considered better than the authoritarian style but not as effective as the democratic style.

Research on the behavior of individuals with leadership is moving in many new directions and new lines of inquiry are opening up in an attempt to construct the leadership model. The following contemporary perspectives are only a few of the numerous inquiries into the new leadership models.

Transactional leadership is the traditional management function of leading. Transactional leaders in essence do what managers do: they clarify the role of employees, initiate structures and reward or punish individuals for the team’s performance. One individual is given the opportunity to lead the group and that group agrees to follow his lead in order to accomplish a predetermined goal in exchange for something worthwhile. The leader is given the power to evaluate, correct and train the employees when productivity is not at the appropriate level and they are able to reward effectiveness and efficiency when the outcome expected is reached.

Over the recent years a particular interest in transformational and charismatic leadership has been taken by I/O psychologists because in the past individuals have ignored the importance of the leader as a communicator. The following two leadership styles inspire followers through their words, ideas and behaviors.

The expression “transformational” is used because change and adaptation to change are the forerunners of a successful modern organization. The transformational leader is a person whom has a definite vision of the organization in the future and of what they want to achieve and transform followers’ beliefs, values and needs. The transformational leader seeks to accomplish their goals by making workers or followers feelings more aware of the importance of want they are trying to do, convincing them to put the organizations or teams needs ahead of their own self-accomplishments and to appeal to their achievement and mastery needs.

Charismatic leadership has a dependency more on the actual force of the leader’s personality as to the appeal of the leader’s vision. Charismatic leaders have the ability to put all their trust in others, are able to take personal risks and are sensitive to other people’s needs. They also have the ability to make individuals overcome lack of personal belief and do more than what is normally expected of them; they motivate subordinates to transcend their expected performance.