The Top 7 Management Styles: Which Ones Are Most Effective?
In the past, managers were viewed by their employees and organizations as valuable commodities. They were seen as capable leaders with distinct management styles who guided their organization’s teams to success. They were viewed as indispensable.
Why is it that public opinion has changed so drastically? Are managers a useless relic of the past, an unnecessary component of corporate culture that’s fast becoming obsolete?
So, what’s the problem then? Why are so many managers viewed unfavorably?
The Wrong Management Style Hurts Everyone
Research from Gallup found that organizations choose the wrong manager a whopping 82% of the time. It’s one of the most important decisions a company can make, yet 8 out of 10 times everyone gets it wrong.
It’s easy to assume that those 82% of managers just weren’t cut out to be in a management position. But, a four-year study conducted by Leadership IQ found that more often, the case is that the manager’s style is inappropriate for their particular culture.
Different projects, teams, tasks, and businesses need different management styles. If you cannot adapt to the needs of your position and organization, then you’re doomed to failure.
Not only can an inability to adapt lead to your being demoted or let go, but it also hurts the entire company.
When your team isn’t engaged, that results in:
- Lower productivity
- Poorer quality work
- Dramatically increased turnover
- More issues with theft and absenteeism
- Reduced profitability
The bottom line is that the wrong management style de-motivates employees, kills productivity, and trains employees to disengage or leave. Hurting the entire organization.
But how do you know which management style is called for? And how do you successfully adopt the right one?
1. Authoritarian management styles
The authoritarian management style involves managing through clear direction and control. It is also sometimes referred to as the autocratic or directive management style. Authoritarian managers typically assert strong authority, have total decision-making power, and expect unquestioned obedience.
This type of management style requires clearly defined roles and strict hierarchies and reporting structures. Employees should not have to question who is responsible for what. To be an effective authoritarian leader, you need to be willing and able to consistently stay up-to-date on your teams’ work and to make any and all decisions.
Bill Gates is an example of a positive authoritarian leader. He had a clear plan for his company. A plan that was difficult or impossible for many others to grasp until it became a reality and Microsoft became a household name.
Without being able to see and share what he had in mind, Gates couldn’t entrust his team to make decisions on their own. Which is why he directed the team and maintained the decision-making power.
In the right environment, an authoritarian management style has been shown to positively affect employee performance.
The best environment for authoritarian management typically includes a traditional culture, such as that commonly found in China and some other Asian countries. These cultures have a high power distance, where employees expect higher-level people to have more power and tend to automatically defer to those in higher positions.
Authoritarian management style can also be effective if you have new or inexperienced employees who need a lot of guidance and instruction.
It’s important to note that if taken to the extreme, an authoritarian style can easily create a negative workspace.
For instance, if you try to hold on to control too tightly, it can lead to micromanagement, which will drive away your best employees.
Maintaining total control of all decision-making can also require a great deal of time and effort. If you’re overseeing large and/or complex projects, this can be incredibly difficult to manage.
2. Visionary management styles
The visionary management style is also sometimes called inspirational, charismatic, strategic, transformational, or authoritative. Visionary managers focus on conveying the overall vision of the company, department, or project to their team.
Unlike authoritarian managers, visionary managers don’t involve themselves in the day-to-day details. Instead, they focus on motivation and alignment of the team, to keep everyone moving in the same direction, and entrust their team members to handle the details about how to get there.
If you are naturally a charismatic, outgoing, and personable leader, you may find this style easy to adopt. However, it can be more challenging for introverts or people who are uncomfortable in the limelight. It also requires a great deal of emotional intelligence, a willingness to take risks, and the ability to lead and manage change.
A well known visionary leader is Nelson Mandela. Mandela was the face and leader of the Anti-Apartheid movement. Through his determination and force of will, Mandela successfully led his country of South Africa to liberation. By relying on his charismatic nature and important vision, he motivated people to bring change without dictating their actions.
One of the advantages of visionary management is that it helps motivate employees to work toward common goals and solutions.
If your team culture is currently divided, a visionary approach may be useful for getting everyone back on the same page. Visionary management is also often used when a company or team needs to change.
A disadvantage of visionary management style is that the lack of focus on the detail can lead to problems, especially if your team members are inexperienced or new.
For this reason, visionary management is typically better for experienced, professional teams. People who are already knowledgeable and capable enough to do their work with little or no supervision.
3. Transactional management styles
Transactional management style focuses on using positive rewards such as incentives, bonuses, and stock options to motivate employees to improve their performance. For instance, transactional managers may rely on piece-work pay to incentivize their employees to produce more. Similarly, they may structure quarterly or annual bonuses around employee performance.
Transactional management style is founded on the belief that you can successfully manage and motivate employees through extrinsic rewards.
Sean Gilbert is one of the co-owners of Gilbert Orchards in Yakima. Gilbert uses piece work pay and supports it as a means of driving higher productivity.
However, there are now numerous lawsuits and class action cases against the state’s tree fruit companies, claiming that piece work pay is unfair and not in line with minimum wage laws. This conflict and rise in legal action may make many leaders hesitant to rely solely on transactional management to drive performance.
Transactional management style tends to be effective for short periods, where you need to motivate your team to complete work they don’t want to do. For instance, if you need them to work overtime for a couple of weeks to finish a project on time, offering an extrinsic reward can be effective.
Studies show that extrinsic rewards are less effective than intrinsic ones, particularly in the long run. In fact, they can negatively impact employee motivation if used too heavily or for too long.
If you want to increase your team’s workload or hours indefinitely, transactional management will not be successful. It’s also not suitable for promoting creativity or innovation, as rewards are tied directly to known results.
4. Servant Leadership management styles
The phrase “servant leadership” was originally coined back in 1970 by Robert K. Greenleaf in an essay titled “The Servant as Leader.” This management style is also sometimes called coaching, training, or mentoring.
A servant management style focuses on supporting your employees. Managers who embrace this style spend their time, coaching, mentoring, and supporting their team. They see their role as one of an adviser or coach rather than a dictator or rule enforcer.
In order to be an effective servant leader, you need to be highly experienced both in the jobs of your employees and in performing coaching. Strong interpersonal skills are needed in order to relate well with your team and build a mentoring relationship. For your team to trust you and open up to you, you will need to show them you are ethical and trustworthy.
Jack Ma, the Executive Chairman of Alibaba Group, is a well-known example of someone with a servant-leadership management style. Ma is a champion of philanthropic efforts and is recognized as a leader who is highly supportive of his employees. Ma prizes emotional intelligence and fostering love and support among his employees in order to achieve greatness.
The servant-leader management style is effective in helping your team develop and advance professionally. It also helps create a strong bond between employee and manager and can promote greater trust, bonding, and collaboration.
The focus of servant leadership is not to discipline but to help people learn from their mistakes and improve their own performance. If you have a team of highly-skilled professionals, this leadership style can help them reach new levels of performance and productivity.
One of the disadvantages of this management style is that it can be ineffective for some employees. For instance, if you have negative employees that are unmotivated, negative, and/or simply a bad fit for their role, trying to support and coach them may waste both of your time.
Also, by focusing on learning opportunities and improvement, you effectively communicate that output is not as high on your priority list, as long as people gave it a genuine attempt. While this can be successful for process improvement, innovation, and other cyclical initiatives, it can cause problems if your team is producing physical products or providing customer service.
This management style also typically requires more of your time, since you have to spend some time in one-on-one meetings with your employees in order to effectively coach and support them. If your time is limited or the quality of your output is more important than the happiness and well-being of your employees, then this style is not ideal.
5. Pacesetting management styles
Pacesetting management style embodies leading from the front of the pack. As a manager, you provide instructions and set a work pace, and then expect your employees to follow in your footsteps.
Typically, pacesetting involves setting high or hard to reach standards in an effort to drive your team to achieve new bests and hit bigger goals.
For it to be successful, you will need to be capable of setting a pace that is challenging for your team. You will also need to ensure that they are motivated enough to try to match your pace.
Jack Welch, once the CEO of General Electric, is a prime example of a persistent and demanding pacesetter. While he effectively led the company for twenty years, he did earn some negative press and the nickname “Neutron Jack” for setting an exacting pace and cutting 25% of the company’s jobs over a four year period.
If your team is capable and motivated, this style can lead to greater productivity and a healthy sense of competition and accomplishment. It is most effective when you have a single big challenge to tackle or a short-term goal to reach.
Research by Harvard Business Review shows that the majority of teams should avoid implementing stretch goals. However, they did find that effective but complacent teams can benefit from their use.
In other words, if you have an effective team that you know is not living up to its potential, adopting a pacesetting management style can be an effective way to get them out of a comfortable rut.
If you’re consistently pushing your team to meet stretch goals, you can cause them to burn out. Plus, if your team is not capable of meeting your standards, you could end up setting them up for failure. And the inability to reach the goals and targets provided can result in a loss of motivation, and lower morale.
This management style also emphasizes personal accomplishments, so it can create divisions and resentment among the team. For instance, if only one or two members are able to keep up with your pace, the others could become bitter and resentful.
6. Democratic management styles
A democratic management style is also sometimes referred to as consultative, consensus, participative, collaborative, or affiliative style. This style is based on the philosophy that two heads are better than one and that everyone deserves to have a say, no matter what their position or title.
Managers who adopt a democratic style encourage idea sharing and regular employee participation. The focus is on encouraging your team to share their thoughts, ideas, suggestions, and potential solutions in order to help each other, and the company grows.
In a democracy, you as the manager, retain the final decision-making authority, but you seek out and take into account the thoughts, ideas, and recommendations of your team before making any decision.
Ray Dalio refers to this type of group as one where an idea meritocracy exists – the best idea wins, no matter who’s idea it is. Dalio is the founder of Bridgewater Associates, a global leader in institutional portfolio management and the largest hedge fund in the world. Dalio values independent thinking and encourages every employee in the company, no matter how new or how junior, to put forward new ideas and suggestions.
A democratic leadership style helps your employees feel valued and heard. It can also encourage them to solve their own problems and come up with innovative new ideas. By asking for their input, you’re effectively encouraging your team members to think for themselves and to take on more responsibility for team decisions and outcomes.
Plus, by seeking out the ideas of others, you can arrive at better solutions and achieve greater results than if you’re making decisions in isolation.
The biggest downside of democratic management is that it takes time. If you’re often in a scenario where a decision needs to be made quickly, you won’t have time to seek out and consider the suggestions of the team.
Another issue is that employees can become frustrated or resentful if they feel like you’re not truly taking their ideas into consideration. For instance, if you never appear to go with Bobby’s suggestions, it could result in his feelings being hurt.
To avoid this, you will need to either promote anonymous suggestions, to remove the possibility of favoritism, or become adept at facilitating discussions and helping your team focus on valuable idea creation and sharing without emphasizing who came up with what.
7. Laissez-Faire management styles
The laissez-faire management style emphasizes employee freedom. Laissez-faire originates from French and directly translates to “let do” in English. In other words, laissez-faire managers let their employees do what they will, with little to no interference.
Within the laissez-faire management style, there is no oversight provided during the creation or production process. Laissez-faire managers promote self-directed teams, and typically only get involved if something goes wrong or the team requests it.
In a smoothly operating team, a laissez-faire manager will only appear present at the beginning and the end of the work process. At the beginning, to provide guidelines, share information, and answer questions. And at the end to review the outcome(s) of the team and provide advice or recommendations about how the team can do even better next time.
Google uses laissez-faire management as a means of promoting employee creativity and innovation. Google Founders Larry Page and Sergey Brin created “20 percent time” way back in 2004. While the rule has changed over time, in essence, management allows employees a portion of their paid work hours to focus on whatever project they want, without any management oversight.
This freedom enables employees to focus on work they are passionate about and to experiment with creative new ideas. Hugely successful innovations such as AdSense, Gmail, and Google Maps can all be attributed to this “20 percent time.”
If you have a team of highly-skilled professionals, they may thrive with the freedom that a laissez-faire approach provides.
This management style can result in a high level of job satisfaction and high productivity for teams who enjoy the autonomy it provides. It can also help boost innovation and creativity throughout your organization.
If your team is not self-motivated, is not skilled enough to solve problems on their own, or struggles to manage their own time, laissez-faire can result in missed deadlines and poor quality work.
The lack of oversight inherent to this style is not appropriate for teams that cannot self-manage. It is also risky on large and/or critical projects, as you may not become aware of issues until it’s too late.
This is a lot to take in, isn’t it? What about your employees? Which management style will work best for them?
Which is right for you?
Your perfect management style needs to align with the following:
- Your own skills, experience, and personality. For instance, you may struggle to be a pacesetter if you’re not a subject matter expert.
- The needs of your team. Is your team new and inexperienced? Or are they highly-skilled professionals? The answer will impact which management style you should adopt.
- The culture. The culture of your team and the organization as a whole need to impact your style. For instance, if your company is currently undergoing a lot of change, you may need to be a visionary. If you have a divided and unmotivated team, you may need to be a servant leader.
The problem is that the vast majority of managers aren’t asking themselves which management style is the right fit. They’re simply adopting the one they’re most familiar with, most comfortable with, or the one they’ve been told to exhibit.
This inflexibility inevitably leads to disaster.
The most successful managers understand that you need different styles for different scenarios and different projects. You may even need different styles for different members of your team.
A new junior employee may need an authoritarian style until they become comfortable with the job. While your senior employee who is highly motivated and reliable may thrive under a laissez-faire management style.
Amazing managers craft their approach around their audience and can fluidly switch between styles as situations change.
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