Photo of three people at a leadership meeting
Leadership style:

Leadership styles determine organizational performance

– Uplifting or devastating

A comprehensive exploration of the nuanced effects that various leadership styles have on organizational performance.

Effective leadership is an evolving art form. As supported by a comprehensive Harvard Business Review article on leadership styles, various approaches to leadership have a transformative effect on organizational outcomes. We delve deeper into this concept by analyzing two illustrative case studies: Sears, a company with a weak culture, and Google, renowned for its strong organizational culture.

Understanding the six leadership styles

Daniel Goleman’s work in his Harvard Business Review article categorizes leadership into six distinct styles. These include the coercive, authoritative, affiliative, democratic, pacesetting, and coaching styles. Each has its own set of benefits and pitfalls, as discussed in his book “Leadership That Gets Results”.

Why leadership style matters

The style of leadership adopted can either energize or demoralize an organization. Leadership styles directly influence employee engagement, operational efficiency, and ultimately, the bottom line. In the same vein, the Harvard Business Review has an article that discusses the link between leadership style and financial performance.

Case study 1: Sears – a weak culture

Under a predominantly coercive leadership style, Sears faced a decline that is often attributed to its corporate culture. The leaders were more concerned with short-term financial gains than employee well-being or long-term strategy. This echoes the thoughts presented in the book “The No Asshole Rule” by Robert I. Sutton.

The fallout

Sears faced operational inefficiencies and a high turnover rate, which led to a decline in customer satisfaction and overall performance. This unfortunate development highlights the inverse of what Patty McCord discusses as a culture of freedom and responsibility in her book “Powerful”.

Lessons learned

The story of Sears serves as a cautionary tale for companies that opt for a coercive leadership style, placing excessive emphasis on immediate financial results at the cost of culture and long-term stability.

Case study 2: Google – a strong culture

In contrast, Google thrives under a more democratic and affiliative leadership style. The tech giant has been consistent in encouraging open communication and innovation, mirroring Harvard Business Review’s positive case on resilient teams.

The upside

Google’s leadership style has yielded high employee satisfaction, low turnover, and exceptional productivity. These outcomes align closely with the book “Drive” by Daniel H. Pink.

Key takeaways

The case of Google validates that a leadership style focused on employee well-being and long-term vision can propel an organization to industry leadership.

The bottom line

The impact of leadership styles on organizational performance is profound. Sears and Google serve as two polar examples, illustrating the power of leadership in shaping organizational culture and performance. Adapting one’s leadership style to complement team dynamics and organizational ethos, as Daniel Goleman advocates, is crucial.

Adopting a balanced leadership approach, as Patty McCord underscores in her book “Powerful”, can pave the way for sustainable success and enhanced organizational performance.