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These Are The Best Business Leadership Styles We Need

Which one are you?
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Suck at money? Congrats. You’re part of the 99 percent of people in their 20s floundering when it comes to finance. Adulting is hard, and money is harder—especially when it’s your own and not your parents. My Two Cents is here to break down everything you need to know about finance, business, and entrepreneurship. We’ll tackle all the basics, from how to get a business permit to how to invest in stocks, to educate the fledgling adults on how to not go broke.

Welcome to the idiot’s guide to money. Lesson #17: Going through the different business leadership styles.

“Leader” is rarely is anyone’s job title. Most high-ranking position in companies go by the title of “manager” or “coordination,” thereby hinting at something missing in many large and small enterprises: leadership. You can be a senior-ranking official in a company, but that title doesn’t make you a leader. It’s your action and example that will determine whether you’re worthy of that title, and many rarely are. The lack of leadership qualities in employees is a symptom of a greater problem within a corporation—a sign that they’re building factory workers instead of leaders and movers.

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The best corporations have leaders throughout the org chart, with people at the very bottom proving they have the mettle to be worthy of the title. Solid leadership inspires productivity and satisfaction, and this in turn pushes your company to grow. Leaders are made, not born, and most of the time, leadership is contagious. Leaders create more leaders, as the success of others will determine your own. Seeing your bosses work harder than you and leave later than you will inspire others to do the same.

If you don’t want to have a company full of followers, here are the best four styles of business leadership that we need more of right now:

Transformational Leadership

Unless you work in the army, where bureaucratic and autocratic leadership are required, or at a manual labor job, where transactional leadership can cut it, employees in the 21st century, or 2020 to be exact, need something more from their higher-ups—they need leaders, not managers.

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Call it the "snowflake" generation or the curse of the millennials and Gen-Z, but the new crop of workers want to be surrounded by people who inspire them. One of the main reasons the younger generation resign from their jobs is because of toxic work cultures which are propagated by bad or lack of leadership.

Transformational leadership is perhaps the best style there is as it’s authentic, aware, and empathetic. Transformational leaders look at their employees as more than just a cog in the machine. They see someone ready to learn and improve their skills. The goal of transformational leaders is the growth and development of their people—they want to transform them into a better and more productive version of themselves.

While they’re active on the ground, this type of leader sees the big picture and works toward achieving it. Think of them as the captain of the ship who still makes an effort to know and assist each and every employee.

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Coach-Style Leadership

If the transformational leader is the captain of the ship, the coach is his right-hand man. The coach is even more hands-on than the transformational leader, as his goal is to grow his team members. The big picture is less of a concern for this type of leader.

The coach doles out feedback, and takes note of each employee’s strengths, weaknesses, and motivations. This leader is also unafraid to say what needs to be said, but in a constructive manner. They’re also largely responsible for setting the tone of the office or environment.  

Most of the time, lack of coach-like leaders lead to toxic environments where bad styles of leadership come in to fill the gap. Having a coach-like leader is essential to making your employees feel appreciated. This style is necessary in almost every field as everyone needs a mentor, making is one of the best business leadership styles out there.

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Coach-style leadership is perhaps the opposite of the Laissez-faire style as this type of leadership is based on giving team members a lot of freedom with little guidance. While this might be practical for police officers and very senior and experienced workers, a hands-off style of leadership isn’t the best style for the general body of a company. The coach is the opposite as it practices a hands-on style of leadership that still manages to avoid stepping into the minefield of micro-management.

Democratic Leadership

The democratic leader is the one who weighs the opinions of his team members more than his own. He lets them make the decisions through brainstorming and consensus. This type of leadership is one way to boost morale and commitment to an organization. If they have a say in what happens, they’ll grow their long-term commitment to the company. And commitment is a hard thing to come by in the workplace.

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With the decision-making power in their hands, employees will be more motivated to produce quality outputs and create collaborative relationships with co-workers. It’s an engaging style of leadership best suited for creative fields or non-government organizations.

While the team members share their ideas and opinions, democratic leaders can direct the conversation and effectively act as the facilitator of discourse. If management decides to make the final decision, this type of leadership becomes a participative style of leadership, which is still similar to the democratic style.

Servant Leadership

This is perhaps one of the best, but rarely used, forms of leadership—the servant leader. It’s a style best attributed to government officials or those with many subordinates. When it comes to corporations, it’s the style of leadership that should be taken when dealing with customers and the general public.

Servant leaders prioritize the satisfaction and welfare of the people over anything else. Its main premise is not what the employee can do for the company, but what the company can do for the employee—taking a page right out of John F. Kennedy’s playbook.

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The purpose of servant leadership is to give back from a position of power, which can also be applied through corporate social responsibility projects for companies with good standing in a community.  

A number of business leadership styles were excluded from the list: namely, autocratic, bureaucratic, transaction, and laissez-faire, as these outdated styles just won’t make the cut nowadays. The four listed above are the best leadership styles we need in the new decade—now where do you fit in?

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Anri Ichimura
Staff Writer, Esquire Philippines
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