This comprehensive guide outlines the different leadership types and explores which ones best suit startups and small businesses.
The concept and practice of a leadership role is one that is sometimes almost shrouded in mystery and often prescribed to personality rather than specific skills and professional attributes.
It is a complicated aspect of business, and it has proven to be one of the most defining aspects and determinants of success for the start-up business. However, there is so much more to leadership than simply the qualities that a person has, and some of these are skills that can be learned with a little time, work, and mentorship.
Leadership types for small business and startups
This article will unpack the concept of leadership types and provide some tips and insights for start–up businesses, so that your start-up has the best chance of success with the foundations of strong leadership from the beginning.
Leadership vs management
One of the first things to get out of the way are the differences and similarities between leadership types and management types. For the purposes of this piece, leadership should be seen as the ability to influence or guide people. On the other hand, while somewhat similar, management is more about the processes and people and getting them to work in unison to produce value.
However, there are definitely some key similarities, in that both leaders and managers need to be able to work with other people towards a specific goal. Both of these are used in business, and a good leader will also have management skills and vice versa.
A great way to look at it is that the leader defines and creates the vision and mission of the organization, while a manager is then employed to implement and achieve the goals relevant to reaching that specific vision and living the mission.
The main differences between leadership vs management
Why leadership types are so important
The leadership of all business types and of business in all stages is important for success. Leadership is indeed important in all sectors; the widest number of sectors and organizations realize the importance of leadership and have encouraged staff to add to their technical skills to inspire and drive those they work with. Hence the leadership types can further that success — or not.
The University of Ottawa online is a prime example of the courses on offer that aim to train those in healthcare and engineering in leadership. However,the leadership of a start–up is perhaps more critical to its success in that it is the leader of a start–up that provides the business with vision, direction, and perhaps innovation as well. The following are the top reasons that good leadership will make or break your start–up.
These are generally done all the time in a business and can be done by a good manager, but the decisions made in critical situations will define a good leader. This is why for the start-up; leadership rather than management is key. Start–ups are in a constant state of uncertainty and flux; it is likely to always be a critical situation requiring good leadership.
The start–up is arguably the business stage that most requires leadership, the ability to convince others of the viability of an idea and then to work towards the manifestation of the idea over a significant period is absolutely critical if the start up is to get off the ground.
The leadership types that best suits the start–up
There are so many leadership types, and what is required by the specific business will always be unique and contextual. However, there are several leadership types that have been proven to work best for the start–up. Regardless of sector and industry, all start–ups need flexible, innovative, communicative, and passionate leadership types.
Leadership types: The charismatic
Charisma is what essentially captures the heart and minds of others and creates believability. This style of leadership has at its core, human and social engagement. Engagement with workers, funders, buyers, and more. The start–up leader needs to create the networks that the business will use as it grows and matures.
A leader who can lift the mood and encourage employees to perform at their best, especially when times are hard, is an essential leadership trait required by those who intend to lead a new business into the marketplace. In terms of charismatic leadership, think Martin Luther King Jr, a phenomenal orator who had one of the deepest commitments to others.
Leadership types: The transformational
These leaders are involved in business development, striving for success, and helping each member of the group or team succeed. The transformational leader can put the needs of others and the business ahead of their own and then convince the wider working team to behave in sync, which can create strong bonds and long-lasting driven teams. The transformational leader is best at creating an environment wherein all can grow and are interested in each other as much as they are the success of the business at hand. These leaders will be innovative and drive change, not just in their industry, but will also want to make a difference to the world through philanthropic efforts. Though you might have these aspirations, it is best to start small by making sure that your workforce is paid a fair living wage, and has the best working conditions possible, and then concentrate on giving back to the local community by taking part in fundraising activities.
Leadership types: The servant–leader
The servant–leader is one who leaders from the back. They are not about the fame or hype but will quietly, humbly go about their work, driving the team to success. They can also put the needs of the team and the business first; they serve and gain respect and following who will then be the success that the leader instills. Fred Smith, the founder of Fed Ex, is a great early servant leader who noted that “when people are placed first, they will provide the highest possible service and profits will follow“. This idea of putting others first is at the core of servant leadership.
Leadership types: The combination
Many of the top management and leadership writers argue that a combination of the aforementioned leadership types is the best for the start–up business. And there certainly are examples of this type of leader doing well in the start–up arenas. The difficulty is that if it is not a natural pairing, it can come across as rather contrived.
Can leadership be learned?
The key to keeping in mind for the start–up is that the leadership position is generally not one that is debated, voted for, or presented to the best leader. The start-up leader is more often than not the ideas person, who then has to lead the business development process. It is a factor worth considering for the start–up, and for some, it has been the fastest route to failure. Embarking on a dangerous journey without a capable leader at the helm is always likely to end in disaster. This has elicited a train of thought or argument in start–up and entrepreneurial writing that raises the need for the successful entrepreneur or start–up initiator to train in leadership. Management has been more common, wherein leadership and the various typology form a small component.
Conclusion
Regardless of the specific sector and the time in the business lifespan, leadership types are one of the defining success points for any business. The lesson for the start–up to take away from this article is that leadership should be the focus in the early stages, and as traction gains, management processes that sustain good practice should be instituted in combination with changes in leadership style and objectives.
In conclusion, it must be reiterated that the particular leadership types may well vary from start–up to start–up. For example, the human resources that are onboard early and the specific context and product or service will differ vastly, so too must how these people be led to achieving the best for the business.
The aforementioned leadership types provide some insight into what has been proven to work and will provide a good starting point in how leaders approach the start–up challenge, but many other leadership styles and techniques should be considered to meet the specific start–up needs.
