Three Leadership Styles and How They Affect Your Business - Home Artisans of Indiana w
Three Leadership Styles and How They Affect Your Business
Three Leadership Styles and How They Affect Your Business

“Leadership is the capacity to translate vision into reality.” Warren Bennis, pioneer in leadership studies 

If the what of leadership is simple – “the action of leading a group of people or an organization” – the how is much more complex.  The action of leading people, the mission of translating vision into reality isn’t a one-size-fits-all proposition. It depends greatly on the wheres, the whys, and most critically, the whos. While we tend to gravitate towards certain leadership styles that align with our personalities, skills, and strengths, there is a vital question we need to ask ourselves: 

Am I the leader my people need? 

3 Common Leadership Styles and How They Impact Your Business 

Before we introduce these leadership styles, know that there isn’t a “right” answer. There is an answer that works for you. And there may not be one answer at all: some leaders use a mix of these styles (and others) strategically to affect best results depending on the issues at hand, the teams involved, and the goals for which they are striving.  

Each of these styles has pros and cons, as well. When we are aware of them, however, we can more effectively overcome areas that need shoring up within our own leadership approach.  


What Is Autocratic Leadership: 

If you ever thought, it’s Elon Musk’s world; we just live in it… You’ve nailed his leadership style. Leaders like this leverage the power of authority. It’s their show, and they don’t want any supporting actors. They make decisions independently and without opening it up for discussion with the whole. They say, “Do this,” and their people are expected to do it. 

When it Works Best:

Autocratic leadership seems anathema to everything we believe (or say!) about collaboration and giving employees a voice. However, this style is often remarkably effective when dealing with crisis situations. This leader can take charge, make difficult decisions quickly, and serve as a beacon of strength to the team. Additionally, autocratic leadership tends to work well when the team requires correction or realignment.  


Besides the advantages we discussed in terms of crisis and correction situations, autocratic leadership can: 

  • Increase efficiency. These leaders don’t “rule” by committee. This streamlines decision-making processes. 
  • Provide clear expectations. They often know what they want, how, and when, giving employees (and other stakeholders) clarity they need to perform their roles.  
  • Simplify communication. Chances that decisions and directions will get lost in translation (e.g. from owner/CEO/president to upper management to middle management to employee… it can feel like a game of Telephone) are vastly reduced. There is one person providing directives; everyone follows suit. 


When one person is making all the decisions… one person is making all the decisions. Perspective can be limited based on their own thinking, ideas, and experience. Autocratic leaders run the risk of letting innovation pass by because they do not seek input from others. This can breed resentment and disengagement due to lack of recognition or feeling under- or unvalued.  

Examples: Elon Musk, Steve Jobs, Bill Gates, Martha Stewart, Vladimir Putin  


What Is Democratic Leadership: 

As you would expect, a democratic leader wants to hear ideas; they actively solicit feedback and perspectives, while operating under the belief that all team members have a voice – and should use it. They lead more as a facilitator than an absolute ruler, and participation is key to this style. There’s a quote that’s attributed to everyone from Marissa Meyer to Richard Feynman to Lorne Michaels to Moses at this point: If you are the smartest person in the room, you’re in the wrong room.” Regardless of who said it, it sums up a democratic approach quite nicely.  

When It Works Best: 

Democratic leadership empowers teams with a feeling of ownership over their projects, roles, and results. It is a style well-suited to the typical day-to-day functioning of a company. Most business leaders report identifying with this leadership style most. 


Democratic leaders can achieve great results as this style: 

  • Emphasizes and honors the contributions of the entire team, which most often leads to higher levels of engagement and satisfaction.  
  • Can improve workplace environment and culture. 
  • Taps into the creativity and innovations of diverse people, bringing their skills, perspectives, and experiences to bear. 
  • Can reduce turnover.


Again, all leadership styles have benefits and drawbacks. With democratic leadership: 

  • Deliberating every (or most) decision can be time-consuming. In some cases, there simply is no time for discussion. Action needs to be taken…now. 
  • When there are times that call for quick decisions, it can cause a great deal of stress and anxiety in both leaders and team members as they are not used to or adept with this type of decision-making process. 
  • There can be a lack of clarity when it comes to roles and responsibilities. 
  • It may be difficult to identify those who are not performing up to par. 

Examples: Larry Page, Sergey Brin, Tim Cook, Muhtar Kent 


What It Is: 

The polar opposite of a micromanager, the laissez-faire leader takes a decidedly hands-off approach. They issue assignments and perhaps some general direction, and then they go about their business. Employees are the ones who figure out the best way to complete tasks and deliver on their responsibilities. When team members have questions or require assistance, this leader is available – but they have to knock on the door. 

When It Works Best: 

Laissez-faire leadership works well when teams are self-motivated, self-directed, and able to hold themselves accountable. These employees are confident in their skills and knowledge, as well as their facility with figuring out the right approach for the task at hand.  

It can also be quite effective with remote workers where hands-off is literal as well as figurative. Given the way the work world has changed in recent years, more leaders have had to at least try a more laissez-faire style with remote and hybrid teams! 


These leaders are confident in their people, and employees have much more freedom and agency to operate as they see fit – to use their strengths and skills to execute responsibilities in a way that makes most sense to them. This can empower those self-motivated folks an opportunity to blossom as well foster an environment in which people feel trusted.  


Not everyone responds to laissez-faire leadership, particularly if they are new, growing in their career, facing new challenges, etc. They may require more supervision and guidance, more check-ins, and, if not micromanagement, then at least some active management. Productivity can take a hit if team members struggle in this environment. Further, team cohesion can be negatively impacted as each person is approaching their work in different ways. They may also perceive their leader as ineffective, disengaged, uncaring, unmotivated, etc. 

Examples: Warren Buffet, Steve Jobs 

Steve Jobs? 

You noticed that, huh? How can Steve Jobs have been both an autocratic leader and a laissez-faire leader? This is important: it’s because he recognized that even the same company requires different approaches depending on challenges and goals. Famously forced out of the company he built, Jobs later returned to Apple when it was in dire financial straits. Staging a boardroom coup, he regained control and led Apple to $1 trillion success. He was autocratic but he also made it a mission to stack his company with the best and brightest… and then he let them get to work. 

By the same token, a leader that typically takes a democratic approach may step into an autocratic role when times are rough, making decisions quickly and without input in order to prompt decisive action. And after the storm has passed… they go back to a day-to-day democratic style.  

Leadership is fluid, and the most effective leaders are those who can adapt to the changing needs of their teams, their businesses, their customers, the market, and the world at large.  

Which type of leader are you? Which do you need to be in order to realize the best results? 


You’ve heard it before: It’s lonely at the top. Except it’s not. Leaders need not isolate themselves; peer interaction, support, and guidance is critical. Home Artisans of Indiana is a collaborative community of leaders who are dedicated to professional and personal growth – both theirs and that of others. Learn more at All styles welcome!  

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