The leadership skills of management are crucial to organizational success. Part of the duties of a good management system is identifying the best management style that works for your team or organization. Employees need their potential drawn out by competent managers with quality leadership levels. And so in this article, we will dissect the various management styles, their importance to organizations, and which one is best suited for you.
What is a Management Style?
Management Style is how managers work to fulfill the business objectives. It is how they plan, organize, make decisions, and delegate duties to their staff.
The Importance of Adopting the Right Management Style
In a study by Gallup, they found out that companies surveyed said they choose the wrong managers 82% of the time. That is shocking, considering how essential line managers are to organizations.
There are many reasons for this result, but one obvious one is that many managers pay little attention to their management styles. Adopting the wrong management style can make an experienced team ineffective.
Aside from managers figuring out the best management style that suits them, there is also teaching these leadership qualities to the next generation. A study by Deloitte found out that 63% of millennials leave their job within three years if they do not see growth in their leadership skills.
This study highlights how important learning and identifying the ideal management style is necessary if you want to keep your best employees.
Lastly, proper leadership promotes engagement. Improved engagement leads to better productivity and a healthy culture. A study by Harvard Business Review confirms 78% of business leaders concentrate on improving engagement levels. By adopting the best management styles for their organizations, they come closer to achieving that goal.
Types of Management Styles
We have been talking about the ideal type of leadership in the article. A question that should be at the back of our mind is: what is the ideal management style? The answer to the question isn’t straightforward because there isn’t a one-fits-all management style. Different situations will call for distinct management styles. In this section, we will explore the 10 best management styles.
Autocratic leadership is a top-down management style, often dubbed the traditional management style. This management style demands employees to follow strict instructions. It is a style in which all the decision-making power lies with the top management. So what are some features of the autocratic management style?
- There is a strict reporting structure all employees must follow.
- Decisions are quick since only one person or a small group makes them.
- Management strictly supervises the work of employees.
- Rules and instructions are absolute in most cases.
- Communication is clear and concise – often giving detailed direction.
The biggest advantage of the autocratic leadership style is directives given to employees. Clear goals also promote productivity through effective delegation of duty. It can also prompt quick decision-making for the organization.
The big disadvantage of this management style is that all decisions rest in the hands of one person or a very few people, adding to their stress. Another disadvantage is that it kills creativity, participation, and growth in an organization.
A good example of where this style prevails is the military. Another example is manufacturing companies that own factories with strict processes to follow. This style in the right environment will improve employee performance and is prevalent in Asian and African countries.
Servant leadership is a style that focuses on serving the employees and customers. It favors a people-first mindset. It also believes fulfilling personal and professional needs leads to productivity.
Features of a servant leadership
- Active in building employee morale.
- The leaders are good with interpersonal skills and communication.
- It improves productivity by earning the loyalty and trust of employees.
- Encourages engagement and collaboration between employees.
- It puts team chemistry and a positive atmosphere at the forefront.
This management style increases engagement among employees – Some even take the company as their second family. It also encourages growth and creativity.
One of its disadvantages is it drains the leadership. Overseeing the well-being of others can be exhaustive and demanding. It is not the best strategy if your team is result-based. An example is if your company manufactures physical products, this approach may be too costly.
An example of people who had such leadership qualities includes Nelson Mandela and Mahatma Gandhi. Both examples are examples of leaders who were people-minded in order to achieve their goals.
The coaching style is like the servant management style. It is a style that focuses on the growth of the employees. The standout quality of this method is it quickly identifies the strengths, weaknesses, and motivations of its employees.
Some features of coaching management style include:
- The coaching management style is supportive by nature.
- It promotes learning as a way of growing.
- Open to asking questions and regular feedback.
- The nature of this style is guidance and not giving commands.
The coaching management style promotes the learning of new skills. It also teaches employees to be open-minded, which helps their confidence. It improves the company culture as learning is at its center.
The major drawback is that it is a time-consuming activity, as it takes time to identify areas of improvement. Another shortcoming is that it may not favor short-term goals.
In the business world, Sheryl Sandberg, COO of Facebook, puts a lot of expectations on her team but is also willing to support, help and guide when necessary. Another example is Satya Nadella. After taking over a successful but stagnating Microsoft, he introduced a structure that has helped the company evolve.
The visionary leadership style sees a person or group of people communicate the big picture or dream to their employees. They usually are not involved in the daily management of the business but guide the organization towards fulfilling the vision. These leaders are vital when growing as a small company because of the dynamics.
Now let’s look at some features of these leaders:
- These leaders are charismatic and know how to inspire those around them.
- They are risks takers and very optimistic people.
- They earn the trust and respect of their employees.
- Their focus is on motivating and aligning their team or organization to move in the right direction.
- The success of the leadership style depends on the competence and experience of the employees.
An advantage of having this leadership style is it spores growth in companies. The charismatic pull can also bring the team together and help push the company to reach innovative heights.
The drawback that stands out here is this management style can be detrimental to new and inexperienced employees. The lack of attention to detail may also mean top management misses out on short-term opportunities.
Elon Musk of Space X and Tesla is a famous example of a visionary leader. His innovation in the automobile industry and space exploration has seen new doors open in those fields. He also employs competent people to oversee the day-to-day activities of the business.
Democratic management is a style of leadership that promotes the participation of employees in making organizational decisions. It allows employees to share their thoughts, ideas, and feedback with management. Although the final decision is still in the hands of the leader or top management, it still encourages engagement among employees.
Some features of democratic leadership include:
- An emphasis on group participation.
- Encourages anyone to share their ideas or thoughts.
- It needs a leader good at mediation.
- Open and transparent communication system.
Under this management style, employees feel empowered and valued in the organization. It helps to boost employee retention and morale. Since the employees are part of the decision process, it also requires little to no supervision by management.
It can be time-consuming. Planning large-scale discussions and collecting everyone’s feedback is a slow process. It’s possible to choose some employee ideas over others which can destabilize the team or organization.
Ray Dalio of Bridgewater Associates, the largest hedge fund, supports this leadership style. In a TED Talk he gave in 2015, he spoke about the idea of meritocracy, where people can say their minds. It uses the thinking capacity of a company rather than only top management.
Pacesetter management style is when top management or a leader sets high standards. The pacesetter management style focuses primarily on performance. So it’s a style that holds its employees to high standards.
Features of Pacesetter Management style
- There is an emphasis on meeting goals within the expected time.
- They set the standards to stretch employees to get the best.
- The management style emphasizes personal achievements and accomplishments.
- The style is demanding and usually deployed in fast-paced working environments.
This style pushes employees to achieve their goals. It can also help teams that are competent but ineffective.
It can lead to employee burnout. It can also have a demoralizing effect on employees if they don’t meet their targets.
Organizations that deal with fast-paced environments like investment banks, advertising companies, and media houses will often employ this ideal management style.
The transactional management style involves rewarding employees with monetary incentives for achieving their goals. It is a way of encouraging or motivating employees to meet goals in the set period. Usually, these goals are to hit goals related to productivity, like sales and revenue.
Features of this management style
- Places value on employees meeting their targets.
- This method encourages extrinsic monetary rewards than intrinsic rewards.
- It favors micromanagement.
- A rigid approach that doesn’t give room for personal interpretation.
- The management style communicates the goals in a concise and clear version.
- Favors high-pressure environment.
It can be effective when meeting short-term goals as it spurs employees to achieve their goals.
Transactional leadership style isn’t a sustainable method of leadership. In the long term, employees burn themselves out or tire from the style. It also doesn’t support creativity.
Sports teams use this method. Since athletes train to win competitions, adding an extrinsic reward can spur them to win those rewards.
Laissez-faire is a French word that translates to “Let it be” in English. And as the name says, it’s a hands-off approach. Managers give the task, present all relevant information, answer questions, and clear any misunderstandings. After this, they only return to review the work done.
Features of Laissez-faire Style
- It supports the delegation of work.
- It allows for creativity and freedom among the employees.
- This method offers little oversight to employees.
- Management provides all the information, support, and tools needed by employees to execute their jobs.
- Employees are self-directed, and top management only gets involved if something goes wrong.
The method can be beneficial if experienced team members are present. The style encourages creativity, innovation, and accountability. It can lead to high productivity for teams who enjoy autonomy and a high retention rate.
The number one problem with this style is it only suits peculiar people and organizations. It is the worst type of management style for inexperienced employees.
Google is a perfect example of a company that employs this management method. Their “20 percent time,” which allows employees to work on private projects, has seen them produce AdSense, Google Maps and Gmail.
Transformational leaders are like visionary leaders, looking at the big picture. They are charismatic, inspiring, and motivating by nature. While the visionary management style favors smaller firms that are growing, transformational favors large corporations that are going through a period of change.
Features of this management style
- Inspires creative thinking.
- It challenges the team members.
- Inspires others to achieve their set goals.
- The leaders are usually well respected and trusted by their employees.
This type of leadership can improve the engagement and productivity of employees. It also allows for employees to bond together.
The management style relies a lot on the personality of the leaders. The management style pays attention to the big picture and can lose the details.
A popular figure said to use this method is Steve Jobs. A micromanager and rewarder of those who meet their targets. This management style helped him stir apple to a dominant position in the mobile phone market.
A very similar style to autocratic leadership, One key difference is their decision-making steps. While autocratic favors one person making quick decisions, bureaucrats follow procedures and processes set by the management or law. Bureaucratic leadership style demands its employees follow the rules created by their superiors.
Features of the Bureaucratic management style
- It is a structured management style.
- Promotes a disciplined atmosphere.
- It encourages following the rules and laws.
- There is little room for creativity or collaboration.
- It helps to define the roles of employees.
The leadership style is effective in organizations or industries that are heavily regulated. Every employee has their own defined roles, which aids productivity.
This management style doesn’t support creativity, innovation, or free-thinking. This can lead to employees feeling restricted. When making decisions, it is slow because of the layers of authority figures it has to pass through.
A good example is a government-run organization that requires employees to follow statutory rules.
What is the Best Management Style to Have?
The best management style depends majorly on three factors.
- The level of your skills, experience, and personality.
- What your team needs at the moment.
- The culture of the organization.
These three factors play a vital role in determining what management style managers will adopt at different times. If there are inexperienced employees, then a coaching style may be appropriate. For more experienced members, a democratic or even a laissez-faire approach might be sufficient.
In conclusion, all the mentioned styles are good management styles, and any one of them may be ideal given the peculiar situation. While there are some that managers prefer, managers must also learn to be flexible to bring out the best from their employees.
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