The quality and effectiveness of leadership is ultimately graded on the results that are achieved. A company’s goals and business objectives provide the framework within which leaders operate in performing their job.
CHEMARK identifies 6 alternative leadership styles that characterize distinct differences in the way leaders perform their jobs. These are illustrated as follows:
Transformational leaders are individuals who project and practice creativity in the way they do their job. They generate excitement and inspire others in the company to think out-of-the-box.
This style is also often unstructured in its approach to management. The consequence is that focus on the goals and objectives of the organization can be lost. If complemented by others in the company that can contribute these managerial skills to the process, this leadership style can be very effective.
Transactional leaders are structured in the way they do their job. Organizational hierarchy and chain-of-command represent the normal way communications and strategic decision-making happens. This style of leadership is opposite of what occurs with transformational leaders.
Innovation and creativity, unfortunately, are frequently compromised in this environment.
Individuals who focus on the collective inputs of others, including teams or groups within the company, are relational leaders. Building consensus and buy-in is their key characteristic. This style if most effective when there is an endpoint to the “team” process that allows for a clear decision to be made.
Autocratic leaders want and frequently have control of the decision-making process. Decision-making by committee or through a defined group of individuals is mainly window dressing. The leader calls most of the shots leaving the suggestion box empty. Morale and motivation among employees are typically low and un-engaged with the long-term direction of the business.
Democratic leaders seek the input and council of others in the company but retain the decision-making role. Cajoling and seeking opinions, to ensure that other feel their opinion counts, is the principal trait of democratic leaders. Inclusion of a number of employees in the decision-making process requires time but strengthens morale. To be successful democratic leaders need to manage an endpoint to the process.
Versatility and adaptability are the goals of situational leaders. Being able to adjust leadership style to fit with the situation is a unique but important talent. Selecting the right individuals to form the team or group that need to be involved in the decision-making process is a valuable skill. Altering your style to get the most from each group (and individuals) is what situational leaders do.
Dealing with Cultural Differences in a Global Business
Multi-national companies, with a diversified technology platform and a broad market reach, face the challenge of dealing with the significant differences that exist between geographic regions. Within the same market segments, the structure of the business, customer needs and the channels-to-market required to effectively serve these markets are frequently not the same. A separate region-by-region game plan is often needed.
Leadership style that is one dimensional and implemented universally across all regions typically does not work well. Whatever the style, its best fit is normally within the region where the company is based. Often this is where the highest market share and highest level of success has been achieved. Outside of the home region, this is not necessarily the case.
A transactional model of leadership, that employs a structure with significant centralized control of strategic direction, often has problems when administered universally on a global scale. A situational leadership style, which adds flexibility to the decision-making process, is a more successful leadership model when dealing with the business and cultural differences that exist across global organizations.
Virtual meetings have become a widely used method for bringing the right individuals in the organization together from multiple global locations. Using the team concept and some level of empowerment, this approach works when leaders listen and support the recommendations from these interactive teams.
The Reality of Limited Resources
Resources are always in demand no matter what the size of the company. For the most part, there are never enough resources to do the things that need to be done to meet all the company’s strategic objectives or take advantage of opportunities that exist for growing sales revenue.
For mid-sized companies, the resource pool is more limited. This increases the challenge of making the right decisions and focusing on those activities which can provide the best chance for success and return on the investment. In this regard, leaders that employ a relational style and build consensus are often a good fit as long as they ensure there is and endpoint to the decision-making process.
A transactional leadership style is often too rigid and does not allow for sufficient engagement with others in the company who can provide valuable input on priorities. Transformational leadership traits can be a real asset in that they can inspire others involved in determining resource priorities to reach consensus.
When this style of leadership over-rides the input of others and dominates the setting or priorities, leaders isolate themself from the value others in the company bring to the management decision making process. Individuals closer to the market and customers begin to accept the fact that their opinion and efforts matter little. As a consequence, morale is low, and the decision-making process is more of a one-person show.