How leadership styles can motivate teams and influence organisational cultures in a Small or Medium Sized Enterprise, Ireland

In any organisation, leadership plays a key role in team motivation and the development of organisational culture. The leadership style adopted by a manager will have a direct impact on their team’s performance and the culture of the organisation as a whole. In this blog post, we will explore how different leadership styles can motivate teams and influence organisational culture in a Small or Medium sized Enterprise (SME). 

The type of leadership style that is most effective in motivating teams and influencing organisational culture will vary depending on the specific context of the organisation. However, there are some general principles that can be applied in order to achieve these objectives. 

One important consideration is the size of the organisation. In a large enterprise, there are likely to be more hierarchies and formal structures in place which need to be adhered to. In contrast, SMEs are generally more flexible and adaptable organisations, which means that leadership styles need to be more tailored to the specific needs of the team. 

Another key factor is the type of industry in which the organisation operates. For example, manufacturing organisations operate in a very different environment to service-based businesses. Thestyle of leadership that is most effective in one type of organisation may not be appropriate for another. 

Appraise conflicting and differing perspective on the organisational leadership

Leadership styles can be broadly categorised into three main types: autocratic, democratic and laissez-faire. Each style has its own advantages and disadvantages which need to be considered when deciding which is most suitable for a particular context. 

Autocratic Leadership Style: 

An autocratic leadership style is one in which a single individual makes all the decisions for the group. This leader has complete control and expects everyone to follow their orders. There is little communication and no consultation with group members.

The autocratic leadership style can be effective in situations where a quick decision is needed or when there is a lack of experience or knowledge among group members. However, it can also lead to frustration and low morale among employees. They may feel that they have no voice and that their opinions are not valued. Autocratic leaders may also become overwhelmed with work, since they are the only ones making decisions.

Advantages:

• Decisions can be made quickly
• Useful in emergency situations
• Can be effective when there is a lack of experience or knowledge among group members

Disadvantages:

• Employees may feel that their opinions are not valued
• May lead to frustration and low morale among employees
• Autocratic leaders may become overwhelmed with work

Democratic Leadership Style: 

Democratic leadership style is a type of leadership where the leader involves employees in decision-making processes and solicits their opinions. This type of leadership is based on the principle that employees should have a voice in how their work is done and be given the opportunity to contribute to the organization’s success.

Democratic leaders believe that by engaging employees, they will be more committed to their work and be more likely to put forth their best effort. They also believe that employees should have a say in how the company is run, so they are more likely to feel ownership of the company and its success.

Democratic leadership can be very effective when used in conjunction with other types of leadership styles. For example, democratic leaders might use directive or autocratic leadership when they need employees to take immediate action.

Advantages:

• Employees are more committed to their work
• Employees feel a sense of ownership in the company
• Can be very effective when used in conjunction with other types of leadership styles
• Allows for a diversity of ideas

Disadvantages:

• Can lead to indecisiveness if not used properly
• May take longer to reach a decision than other leadership styles
• Employees may feel that their opinions are not valued
• Not all employees are suited to this type of leadership

Laissez-faire Leadership Style: 

Laissez-faire leadership is a type of leadership where the leader steps back and allows employees to take charge. This style of leadership is based on the belief that employees are best equipped to make decisions about their work. The leader’s role is to provide guidance and support, but ultimately the decision rests with the employees.

Laissez-faire leadership can be effective when employees are highly skilled and motivated. It allows them to take initiative and be creative in their work. However, it can also lead to a lack of direction and coordination. Employees may not be sure what is expected of them and this can lead to confusion and frustration.

Laissez-faire leadership is not suitable for all situations. It is important to consider the skills and motivation of employees before using this style of leadership.

Advantages:

• Employees are highly skilled and motivated
• Allows them to take initiative and be creative in their work
• Provides guidance and support

Disadvantages:

• Can lead to a lack of direction and coordination
• Employees may not be sure what is expected of them
• Not suitable for all situations
• Requires careful consideration of employee skills and motivation

Transformational leadership Style:

Transformational leadership is a type of leadership that inspires employees to achieve more than they thought possible. This type of leader motivates employees by appealing to their higher ideals and vision for the future. Transformational leaders are often very charismatic and have the ability to rally employees around a shared goal.

This type of leadership can be very effective in driving employees to achieve results. However, it can also be abused by leaders who use their charisma and vision to manipulate employees. Transformational leaders must be careful to maintain the trust of their employees and not abuse their power.

Advantages:

• Can inspire employees to achieve more than they thought possible
• Motivates employees by appealing to their higher ideals
• Transformational leaders are often very charismatic
• Ability to rally employees around a shared goal

Disadvantages:

• Can be abused by leaders who use their charisma and vision to manipulate employees
• Must maintain the trust of their employees
• Not all employees will respond to this type of leadership

Authoritarian leadership style:

Authoritarian leadership is a type of leadership where the leader has complete control over employees and makes all the decisions. This style of leadership is based on the belief that the leader knows what is best for the company and employees should follow their directives. Authoritarian leaders often have a very strong vision for the company and they make all the decisions with little input from employees.

This type of leadership can be effective in situations where quick decisions need to be made. Authoritarian leaders are often able to make decisions quickly and efficiently. However, this style of leadership can also lead to a lack of creativity and innovation. Employees may feel stifled and not motivated to do their best work.

Authoritarian leadership is not suitable for all situations. It is important to consider the company’s culture and the needs of employees before using this style of leadership.

Advantages:

• Can make decisions quickly and efficiently
• May be able to achieve results in a short amount of time
• Employees know what is expected of them

Disadvantages:

• Can lead to a lack of creativity and innovation
• Employees may feel stifled and not motivated
• Not suitable for all situations
• Company culture and employee needs must be considered before using this style of leadership.

Appraise conflicting perspective on the strategic management process

There are a number of different perspectives on the strategic management process. The two most common perspectives are the classical perspective and the resource-based perspective.

The classical perspective on strategic management focuses on the external environment and how it affects the organization. This perspective emphasizes the need for organizations to be aware of their surroundings and to adapt their strategies accordingly. The classical perspective also stresses the importance of planning and control.

The resource-based perspective on strategic management focuses on the internal environment and how organizations can use their resources to gain a competitive advantage. This perspective emphasizes the need for organizations to identify their unique capabilities and to develop strategies that exploit these capabilities.

Identify the influence of cognitive biases and heuristic in the strategic management process

There are a number of cognitive biases and heuristics that can influence the strategic management process. These include confirmation bias, sunk cost fallacy and groupthink.

Confirmation bias is the tendency to seek out information that confirms one’s preexisting beliefs or hypotheses. This can lead to decision-makers ignoring evidence that contradicts their beliefs, and only considering information that supports their position.

The sunk cost fallacy is the belief that it is always worth continuing to invest in a project or venture, even if it is failing, because of the money that has already been invested. This can lead to organizations continuing to pour resources into failing projects, rather than cut their losses and move on.

Groupthink is the tendency for people to conform to the beliefs and opinions of the group they are in, rather than thinking independently. This can lead to suboptimal decision-making, as dissenting views are not given enough consideration.

These biases and heuristics can have a significant impact on the strategic management process, by influencing the decisions that are made. It is important for organizations to be aware of these biases and take steps to mitigate their effects.

• One way to do this is to encourage a diversity of opinions and ideas during the strategic planning process. This can help to reduce the impact of confirmation bias and groupthink, by ensuring that all viewpoints are given due consideration.
• Another way to mitigate the effects of cognitive biases is to use decision-making tools and techniques such as SWOT analysis and cost-benefit analysis. These methods can help to take a more objective approach to decision-making, by forcing consideration of all relevant information.
• Finally, it is important to have clear and transparent criteria for making decisions. This can help to reduce the impact of cognitive biases, by ensuring that all decision-makers are aware of the factors that will be taken into account.

By being aware of the cognitive biases and heuristics that can influence decision-making, organizations can take steps to mitigate their effects. This can help to ensure that the strategic management process is as effective as possible.

Conclusion

Whether you are leading a team of one or one hundred, choosing the right leadership style is essential to motivating your team and achieving your business goals. Keep these tips in mind as you develop your own SME leadership strategy.