Leadership

Leadership

• Leadership is one of the key skills involved in running a successful business. It has been defined as the art of motivating and organising a group of people to achieve a common goal. The more effectively this can be done, the more successful the business will be.
• MANAGEMENT VS LEADERSHIP
• - the main distinction is that leaders have people who follow them while managers have people who work for them.
• In years gone by leadership and management were seen as being different and separate. The factory foreman or manager was there to make sure that the workers knew what to do and that it got done. They had no connection with the strategy of the business or particular interest in the worker.

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• Their job was not to inspire but to be efficient.
• In today's world a successful entrepreneur needs to be both a strong leader and a manager. Leadership is about getting people to understand and believe in your vision and to work with you to achieve your goals, this means encouraging your staff to develop their full potential and to inspire their work. At the same time the business needs to be organised and efficient. Even the most exciting and inspiring leaders have to worry about managing the nuts and bolts of the operation.

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• Management without leadership is possible, and is perhaps functional but uninspiring. Leadership adds vision and direction, but leadership not underpinned by management could be chaotic. It is possible for good leaders to work with good managers, but ideally a strong leader should have both skills.

Main Leadership Styles

• People bring their own personal qualities to the task of leadership but there are four main types of leadership style.
• AUTOCRATIC
• - autocratic leaders keep power in their own hands and make all the important decisions. Sometimes they try and make all the minor decisions too. They give orders without consulting anyone else. This is a top-down, one-way system of communication that can often be described as dictatorial. Autocratic managers like to control the situation they are in. Decision making is quick because there is no consultation. However, this type of management style can decrease motivation and increase staff turnover because staff may not feel valued if their views are not sought.

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• PATERNALISTIC
• - paternalistic leaders, as the name implies, act as a father might towards their family. They think they know the best and although there is some consideration, consultation and involvement, it is ultimately the leader who takes responsibility and decides what happens. Many paternalistic leaders are confident that their decisions will be the best for the business. Communication is mostly top-down but with some two-way communication. Subordinates feel that they are valued to an extent, but there is no doubt about who is in control.

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• DEMOCRATIC
• - democratic leaders listen to other people's ideas and opinions and take them into account before reaching a decision. There is a two-way system of communication; tasks and minor decisions are likely to be delegated, giving employees responsibility to complete the task given to them. As employees are involved in decision making, they feel a sense of belonging and ownership so motivation is high. Although popular in business today, a democratic management style can slow decision making down because staff need to be consulted, this can be too slow and unwieldy in some dynamic markets. Some leaders who describe themselves as democratic are seen by others as reluctant to let go of ultimate power.

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• LAISSEZ-FAIRE
• - laissez-faire leader will set the initial agenda, then stand back, giving staff maximum freedom to complete their tasks as they see fit. This does not mean that the leader is inactive, rather just that they are there to answer questions, supply information and give advice if needed. The benefit of a laissez-faire management style is that staff can thrive on personal responsibility for tasks, leading to increased motivation and staff confidence. This sort of style may be particularly suited to creative industries where staff can come up with imaginative products and solutions when they are freed from the shackles of conventional management. In fast changing environments, laissez-faire allows people to make instant....

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• decisions. However, the danger is that a laissez-faire leader who does not provide adequate guidance may have staff who feel lost and who might not reach their objectives or deadlines.
• Summary:
• AUTOCRATIC: the boss alone makes decisions.
• PATERNALISTIC: the boss cares about other's views but still decides.
• DEMOCRATIC: consultation, delegation and shared decisions.
• LAISSEZ-FAIRE: maximum freedom for individuals to shape their work.

Leadership Styles in Action

• In the past, most leadership styles in manufacturing businesses would have been autocratic.
• Leadership styles depend heavily on the personality and confidence of the entrepreneur or the manager. But they also depend on the nature of the business and the traditions within the industry. Successful sole traders whose businesses expand into large organisations often struggle to 'let go of the reins' since the business was built on their energy and ideas. People who move straight into management roles after graduating with relevant degrees come from very different backgrounds. However what they have learnt about leadership can only be applied if their personality is right.

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• In reality, leaders will often exhibit some or all of the leadership styles at different times and in different contexts. In a crisis, for example, clear direction might be more important than allowing everyone to pull in different directions. The best leaders will understand their colleagues and know how best to treat them. Good leaders know which style to use or adapt at any given time to get the best from their staff and the best results for the business.