Anyone who has ever worked for more than one boss knows that the workplace can be home to a wide range of management styles. While the concept of management styles may strike some cynics as merely an academic notion, it has real-world implications—as the saying goes, people don’t quit jobs, they quit managers.
Research has found that nearly 60% of employees have left a job because of their manager. And, in a survey conducted by the Society for Human Resource Management, 84% of respondents said poorly trained managers create a lot of unnecessary work and stress.
With half of U.S. employees open to leaving their current jobs, bad managers can wreak havoc in your workplace. Here’s what you need to know about the different management styles and how best to leverage them.
Management styles: What they are and why they matter
Achieving success as an employee is no guarantee that you’ll find success as a manager. That will largely turn on your management style.
Management style refers to how you lead your team to accomplish goals, whether it’s the entire company, a department, or a project staff. Different managers can view the same duties, responsibilities, and objectives from different angles. Your style includes how you:
- Interact and communicate with team members and other stakeholders,
- Plan and delegate tasks,
- Set and assess goals,
- Make decisions,
- Discipline and evaluate employees, and
- Handle day-to-day operations.
It’s important to distinguish management styles from leadership styles. While management style captures how you guide and support your team to accomplish business objectives, leadership style is more about inspiring and motivating from a higher, more removed level. Management styles usually include a leadership component, but leadership styles don’t always include managerial aspects—some leaders prefer to leave the nitty gritty to others.
As noted above, management styles play a critical role in today’s work environment. They have a substantial impact on employee engagement, retention, productivity, company culture, and the business’s ability to execute strategies and attain goals. At a time when many organizations are heavily focused on where their employees work—remote, in the office, or hybrid—research from Gallup indicates that how employees are managed has about four times as much influence on employee engagement and well-being as their work location.
It’s vital to understand, though, that there’s no universal “top management style” for every situation. The most effective style will depend on the circumstances. A style well suited for certain circumstances could prove disastrous in other scenarios. When selecting your style, you must also keep your personal style in mind. A management style that works wonders for your colleague may crash and burn for you if it’s inauthentic or misaligned with your personality, strengths and weaknesses, and comfort zone.
5 approaches most likely to succeed
Every type of management style has its advantages and disadvantages, but used properly, these styles are often the most effective:
1. Democratic management style
This is a collaborative, consultative, and participative approach, where team members have input on decisions and direction. The manager may even delegate decision-making at times, although they usually make the final decision, influenced by input.
The brainstorming that comes with the democratic style promotes creativity. The style also boosts employee morale, as team members feel heard and like valued contributors with skin in the game. The consideration of diverse perspectives can lead to new opportunities for the business when, for example, it recognizes a need that might otherwise have gone unnoticed.
But this decentralized style typically slows the decision-making process. You can end up with hung juries that cause delays. If the manager ultimately opts to go in a different direction than the employees wanted, they might question the manager’s sincerity or conclude that the whole process was just for show. They can end up feeling duped, devalued, and divided.
The democratic style generally works best:
- Earlier on in a new business or project,
- When you’re looking to improve processes or change direction, or
- When team members have similar roles or goals.
Farther down the road, you can appoint individual decision-makers for more granular issues to improve efficiency.
2. Coaching management style
The coaching management style focuses on team members’ professional development and training, with the manager providing regular support, guidance, feedback, and mentorship. The manager is forgiving of short-term failures because they’re looking toward the long-term and trying to help employees develop their full potential to the benefit of both themselves and company goals. It’s similar to the servant management style (see below), except that it takes into account the business’s objectives.
Professional development and growth opportunities are powerful drivers of employee retention and make it easier to promote from within, which, among other perks, greatly reduces recruitment costs. The coaching style helps team members see how their roles fit into overall business strategies and forge strong bonds and relationships. Research shows that managers rated the highest at balancing results with relationships saw 62% of their direct reports willing to give extra effort.
Coaching, however, is very time-consuming. Plus, there is the risk that employees might take their new skills and go work for a competitor.
Coaching may be most appropriate for people-focused managers (e.g., those in human resources) rather than those running individual projects or working in business development roles. Such areas have less room for error.
3. Visionary management style
A visionary management style relies heavily on a charismatic personality and emotion to engage and motivate employees. These managers tend to establish purpose and direction but may have little interest or involvement in the day-to-day details. They let others execute those within the parameters of the manager’s grand vision.
Such charismatic leaders can be inspiring and earn strong buy-in from team members. Employees gain a sense of autonomy, and their shared passion produces hard work.
The high levels of energy and emotions can be a struggle for managers who aren’t natural extroverts—they might experience burnout. It can also be difficult to deliver bad news when you’re expected to be effusive and enthusiastic at all times.
Visionaries are most effective when their team members are skilled, experienced, and equipped to handle the details required for implementation. Employees must be capable of managing themselves.
4. Transactional management style
This style is just what it sounds like—a quid pro quo. When team members meet specific metrics or milestones, they receive a specific reward. It involves extensive measuring and tracking and can generate healthy competition among employees.
The expectations for team members are clear under the transactional style. It’s been shown to have a significant positive correlation with task performance.
A transactional style probably won’t work well with employees who aren’t particularly competitive or interested in the offered incentive, though. Incentives that strongly motivate one employee may hold no appeal for another. Even when employees are interested in the incentives, the effectiveness of this method can wane over time.
It’s best used when the rewards are substantial, such as commissions, bonuses, or stock options. Pizza parties and company swag probably won’t cut it.
5. Transformational management style
Managers who apply a transformational management style welcome change and rapid growth. They’re big thinkers who urge others to also think big and push beyond their usual comfort zones. They raise the bar to help employees see what they’re truly capable of and are more involved than visionary managers.
These managers build innovative and agile teams that can respond quickly to shifting demands and conditions. Their high expectations and challenging goals fertilize long-term development. Research suggests a positive relationship between this style and employee engagement and innovative work behavior.
If goals are constantly changing, though, team members can become discouraged because they never get more than a fleeting feeling of a job well done or accomplishment. It can become exhausting and dispiriting and cause burnout.
A transformational management style is most likely to succeed in startups and fast-moving companies in quickly evolving industries populated with motivated and ambitious team members.
5 styles that can backfire
Some management styles are riskier than others. They may still work, at least for the short term, but they have major potential downsides. Those include:
1. Autocratic management style
This is the classic top-down, hierarchical approach, where what the manager says goes. The manager can be seen as dictatorial because they make all of the decisions, without any input from employees or other stakeholders. These managers give specific, explicit directions and deadlines rather than encouraging problem-solving. They’re hyperfocused on the details, otherwise known as micromanaging. If they give feedback, it’s usually not constructive but critical, sometimes even threatening an employee’s job or humiliating them in front of coworkers or clients.
The autocratic management style has its advantages. It facilitates a speedy decision-making process and a high degree of efficiency.
The problem is that autocrats also alienate team members, who feel powerless and anxious about missteps. They feel unheard and undervalued, like just another cog in the machine. Not surprisingly, this state of affairs isn’t great for motivation or buy-in. The lack of diverse viewpoints in decision-making and problem-solving discourages creativity and out-of-the-box thinking.
Another way of saying a management style is “classic” is to say it’s outdated. Few if any employees these days will welcome an autocratic style—and, in a tight job market, they have little reason to put up with it. For that reason, it should be reserved for crisis situations, where quick decision-making is vital. It might also be necessary when working with a very inexperienced team. Even then, though, you should be transparent, explaining the reasoning for your decisions.
2. Bureaucratic management style
Bureaucratic managers are all about the rules, policies, and procedures. Everything is mapped out and closely measured against these parameters. Managers’ individual personalities play little role in their approach.
On the positive side for team members, there’s not much uncertainty. The standards and expectations are clear, which can be a boon for efficiency.
A bureaucratic style is extremely inflexible, though, with no variation for (or acknowledgement of) different work styles or needs. It can favor those who think and operate like the manager, and the lack of nuance can result in inadvertent discrimination when a dated policy has a disparate impact on protected classes of workers. It can also work against efficiency when team members have to go through unnecessary and unproductive hoops simply because that’s “how we do things.”
That said, some industries and projects require strict compliance with rules, procedures, or legal requirements. A bureaucratic style may have its place in, for example, safety, healthcare, or government contracting.
3. Laissez-faire management style
This style represents a 180 pivot from the bureaucratic and autocratic management styles. Managers are hands-off, allowing team members to work and make decisions independently. Rather than spending their days guiding employees and offering feedback, they occupy themselves with their own work. They do occasional check-ins but typically don’t weigh in more unless their involvement is specifically requested.
Employees working under this style can develop confidence and problem-solving skills. At the same time, employees—especially young and new employees—can feel unsupported, and without direction, so a laissez-faire style may undermine productivity and job satisfaction. Without some structure, team members who aren’t self-motivated may struggle to prioritize work. Employees working in their silos can translate to a lack of cohesion among team members, not to mention a lack of important knowledge about what’s going on in other parts of a project or company. An absence of clear standards or objectives may make it difficult to fairly evaluate employees.
You should save this style for teams of highly skilled employees who embrace working independently and do it well.
4. Servant management style
The servant style is essentially coaching taken to an extreme. The manager puts the employees’ interests (including professional development and growth) at the forefront, ahead of the interests of the manager, the project, and the company. This approach emphasizes teamwork, bonding, and employee well-being, at times at the expense of results and company goals. Servant managers are heavily—some might say disproportionately—invested in relationships. They solicit input from team members but don’t provide much feedback, let alone criticism.
Employees, understandably, enjoy being centered and doted on. The approach allows for nuance to reflect individuals’ needs and circumstances. Employee morale is likely to soar.
Business objectives can suffer, though, and team members might miss their targets. Employees who are strivers and goal-oriented can become dissatisfied and disengaged. Other employees may take you for granted and slack off because it doesn’t seem like performance is a priority.
Servant management styles require a less structured work environment and team members who can be counted on to take initiative and contribute.
5. Pace-setting management style
This style is also known as example-setting. These managers “walk the walk” in terms of their expectations. They’re usually high performers who put in a lot of hours and prioritize deadlines and results. Accountability is high.
This can be a useful style for new managers or managers with little experience. Instead of telling their employees how to perform, they show them through their own actions.
However, it can be unrealistic to expect people at a lower level (and lower pay rate) to meet such high standards. They may become overwhelmed and quickly head out the door. If they stay, the burnout risk is high.
Pace-setting generally works best in fast-paced environments with similarly driven and capable team members.
A hybrid approach
Few managers, rookie or experienced, can simply pick a management style and consistently execute it in every situation. The appropriate style will turn on a variety of factors, including:
- The manager’s personality, degree of experience, and management level,
- The industry,
- Where the company is in its life cycle,
- Team members’ communication styles, and
- The nature of the work to be performed.
Rather than selecting a style and sticking to it, you should be open to adapting your style as needed—don’t be rigid. A combination or hybrid approach where your style depends on the circumstances and individual employees will usually prove most successful in the long run. That’s especially so when the company is in a growth phase, with new employees regularly added. What works in a startup with few employees may become infeasible as you expand.
Gusto’s platform can help growing companies scale with confidence—from best-in-class payroll and hiring tools to comprehensive benefits packages and HR resources.
