Leadership styles! What characteristics make them effective?

As most of us know the best and most ethical leadership style is the democratic leadership style. It is highly people and task-oriented

Most leadership seminars, workshops, and books (literature) are done and written with the hypothesis that leadership should always be democratic. This article will discuss different leadership styles for effectiveness under different circumstances for business and social success.  

Leadership requires two types of skills, namely Intellectual skills and People skills. The intellectual skills are needed to analyse, develop, formulate policies, and make decisions. It is straightforward and not complicated. However, People skills, the second trait makes the subject, leadership more challenging and complex. It gets leaders to interact with people, peers, employees, clients, and other stakeholders. It demands them to influence their followers, convince them and to focus them. 

Late Singaporean Prime Minister Lee Kuan Yew describes these two areas as IQ (Intellectual) Leadership and EQ (Emotional) Leadership. He says he looks for IQ Leadership for projects involved in quantitative and analysing aspects whilst projects involved in leading people to perform group tasks are being given to EQ Leadership. The best practice would be a blend of these two traits to fit-in to the circumstance. The present- day leaders and CEOs should have a blend of these two traits. Depending on the task that they are being assigned their core-competencies could be measured on EQ-25%: IQ-75%, EQ-50%: IQ-50%, EQ-75%: IQ-25% basis. 

Leadership styles

Democratic leadership 

As most of us know the best and most ethical leadership style is the democratic leadership style. It is highly people and task-oriented. However, for a leader to perform democratic leadership in his organisation many supportive characteristics should be in place such as the intellectual capacity of staff, their social and mental standards (morals, values and ethics), working environment and its standards, the financial stability of the organisation and the perception that it has towards its employees. When these conditions are not being met by the staff members and not being fulfilled by the organisation the effectiveness of the democratic leadership is questionable. The sustainability of democratic leadership is doubtful under such circumstances. 

Autocratic leadership

This leadership style is highly task-oriented and gives only a little consideration to the people of the organisation. One can argue that this is the worst leadership scenario from the employees’ perspective. However, this would be the best approach under challenging circumstances. When companies are in dire straits and when there is no hope left a brave autocratic leadership will certainly be effective.

The power and influence theory which has unethical features to some extent would ideally be fit into the style of autocratic leadership to cross over troubled waters. Organisations, as well as countries need autocratic leadership to govern with genuine attitude to get over troubled situations.   

Transformational leadership

This leadership style is highly people-oriented and fewer tasks-oriented. Organisations run at high speed, chasing high turnover and high profits with little consideration to their human capital will have to look for transformational leadership at some point to avoid human unrest and the formation of trade unions which will dampen the progress of the organisation. While making goodwill gestures amongst the employees, gathering intelligent data through covered agents and immediate reaction to such data are the key features of transformational leadership. Transformational leadership has its own unique features with a few unnoticeable and unethical strings. 

Laissez-faire leadership

This leadership style is neither people-oriented nor task-oriented. If so, why this leadership style exists? Some leadership books say it has an attitude of trust and reliance on its employees. They don’t micromanage or get too involved; they don’t give too much instruction or guidance. Instead, laissez-faire leaders let their employees use their creativity, resources, and experience to help them meet their goals. But the bitter truth is when hidden agendas play a major role in corporates and countries dynamic leaderships are being replaced by laissez-faire leaderships in order to prove a case. Once the case is proved hopeless and beyond repairs, acquisitions, takeovers, mergers take place systematically at rip-offs. 

Contingency theory

The policy and decision-makers assess and decide which of the above leadership style suits the situation to make (or break) organisations. Based on such decisions taken at the board level CEOs are appointed. They are being given a mandate to perform. Most organisations today are over-managed by boards and under-led by CEOs. CEOs are not allowed to exercise their core competencies. Instead, they are instructed to carry out orders. The CEO needs to develop his capacity as CEO and shouldn’t be another TV set that broadcasts sentiments of his board’s 

TV channel.

Leadership doesn’t have a secret formula; all true leaders go about things in their own way. It’s the leadership skill of being able to think differently in its own leadership style for success. Sir Richard Branson the founder of the Virgin Group who is known for his democratic leadership style has achieved great heights in his own line of business. On contrary, the late Apple co-founder Steve Jobs who was known for his autocratic leadership style too has achieved great success with his own philosophy and approach. There are no hard and fast rules about which leadership skills work the best; it is all about choosing a style that fits the organisation and optimises the talent available. Notably, in both these cases, the leader as the owner has had the policy-making authority of their respective organisation. Hence, boards have had little say on policies. 

Leaders Vs. Managers  

Managers are given a mandate while the Leaders may not. Hence, leadership is always scrutinising under a microscope. Johan P. Kotter, Professor of Leadership, describes management as a mechanism coping with complexity while leadership is about coping with change. Management and leadership are different but complementary, and that in a changing world, one cannot function without the other. He then enumerates and contrasts the primary tasks of the manager and the leader. His key point bears repeating: Managers promote stability while leaders press for change, and only organisations that embrace both sides of that contradiction can thrive in turbulent times. When changes are made employees, stakeholders, people get confused as they have to move out of their comfort zones. Hence, Leadership is subject to criticism most of the time.

Conclusion

A business organisation (or a country) needs powerful leadership to grow. Once the selection is done, the leadership should be given a reasonable time to settle and then to accelerate. Leadership should have a clear vision of its mission. The business success of an organisation mainly depends on the effectiveness of its leader and the extent to which that he is given the authority to exercise his core competencies. 

(The writer is a visiting lecturer on leadership and strategic management of postgraduate degree programs. He counts 36 years of experience in the non-banking financial industry of Sri Lanka. He is a former CEO/General Manager of a non-bank financial institution and an ex-commission member of the National Science and Technology Commission (NASTEC). He is a Fellow of the Institute of Chartered Professional Managers of Sri Lanka and a Member of the Institute of Management of Sri Lanka. He holds a Master’s Degree in Business Administration from the UK. He can be reached via [email protected].)