7 best management styles for effective leadership

Management Styles
What is a management style?
The 4 best types of management styles
1Visionary management
2Democratic management
3Coaching management
4Transformational management
3 situation-dependent management styles
1Authoritarian management
2Transactional management
3Laissez-faire management
How to adopt a new management style
Final thoughts

Management styles go beyond abstract ideas. They’re among the most important aspects of managing a team. With the right management style, you can create a positive workplace where your team feels valued, motivated and primed for success.

In this article, we’ll look at the best management style types for effective leadership. We’ll also show you how to adopt the most relevant approach for your team.

What is a management style?

A management style describes how a manager makes decisions, sets goals, interacts with the team and delegates tasks. Each management style has a different level of authority, control and involvement from the manager. Some approaches require managers to seek frequent input from their team, while others involve making all managerial decisions independently.

All business management styles can significantly influence the work environment, affecting morale, productivity and effectiveness.

When it comes to management, there’s no one-size-fits-all approach. The most effective leadership style is the one that best inspires your team to push themselves and achieve their targets.

Download your guide to managing teams and scaling sales

The blueprint you need to find a team of superstars and build a strong foundation for lasting sales success

The 4 best types of management styles

The following are four of the most common and successful management styles. All approaches use a positive, collaborative mindset to foster better teamwork and inclusivity.

1. Visionary management

Under the visionary management style, an inspirational leader sets a clear vision for the team. The leader motivates them to work toward a shared goal.

A visionary conceives groundbreaking ideas and future possibilities with foresight, creativity and a powerful sense of direction. Visionaries are persistent, focused and skilled at communicating their ideas to others.

By applying these personality traits to managing a team, a visionary leader can drive innovation, productivity and a sense of purpose.

Characteristics of a visionary management style

Clear vision and long-term goalsVisionary leaders set compelling goals for their teams. They focus on the bigger picture and long-term objectives rather than short-term tasks.
Inspiration and motivationLeaders motivate their teams by connecting their work to the larger vision. They ignite passion in their teams, helping them see they’re part of something meaningful.
Innovation and creativityVisionary managers encourage new ways of thinking and are open to new ideas and risk-taking. The visionary management style values and nurtures creativity.
Adaptability and flexibility

Visionaries adapt easily. They’re ready to change management strategies and confront obstacles to align with their vision.

When visionary management works best

Successful visionary leadership skills require a charismatic manager – one who can communicate their vision and create enthusiasm for their goals.

A visionary approach is most effective in companies where long-term goals and innovation are important. Here are some examples of where to use the visionary management style:

  • When you want to disrupt the market. Industries that see rapid technological changes benefit from leaders who can foresee trends and drive innovation. Visionary leaders are comfortable with the unknown and encourage calculated risks. Such management qualities are ideal for organizations that want to pioneer new products, services or markets.

  • When you work in a creative industry. Creative fields include media, design and advertising. A visionary leader inspires inventive thinking and pushes boundaries, leading to groundbreaking ideas and products.

  • When you need rapid growth. Startups and early-stage companies entering a new market need a clear vision and a competitive edge. A visionary leader can paint a picture of a brighter future and inspire employees to embrace change. Their clear vision helps employees understand how their roles contribute to the organization’s ambitious goals.

2. Democratic management

The democratic management style actively seeks employee input and encourages participation in decision-making. This collaborative management style builds a sense of teamwork and inclusivity so that decisions may benefit from diverse perspectives.

Characteristics of a democratic management style

Inclusive decision-making

Democratic leadership seeks the opinions of team members before making decisions. Managers leverage the group’s collective knowledge and expertise to shape plans.

Empowerment and engagementInvolving team members in decision-making empowers employees and gives them a sense of ownership. Employee engagement can lead to greater accountability, higher job satisfaction and stronger morale.
Open communicationThe democratic style values open channels of communication. Encouraging employees to ask questions and provide feedback helps build transparency and trust within the team.
Diverse perspectivesDemocratic management uses the team’s diverse experiences and knowledge to its advantage to ensure well-rounded initiatives.

When democratic management works best

The democratic management style best serves industries that use collaborative problem-solving. With the team’s collective insight, democratic leaders can make better decisions and foster an inclusive company culture.

Here are some instances where democratic management can work best:

  • When you need a variety of skills to overcome complex problems. Different team members have different skills and expertise. Democratic management lets you tap into all of them to help solve complex problems.

  • When projects involve multiple decision-makers or departments. Democratic management encourages open communication between departments. The inclusion of different decision-makers can help break down silos for a better approach to project management.

  • When you need creative solutions. Involving multiple team members in the decision-making process brings new viewpoints and ideas. This element of diversity can lead to more innovative and comprehensive solutions.

3. Coaching management

The coaching management style develops employees’ abilities through mentorship. It emphasizes team growth and encourages individuals to reach their full potential.

Managers who adopt the coaching style act more like mentors than traditional bosses, providing ongoing guidance and encouragement to their direct reports.

Characteristics of a coaching management style

Personalized development

Coaching managers focus on each team member’s development. They identify an individual’s strengths and areas for improvement to build on their professional growth opportunities.

Active listening and feedbackEffective coaching managers are excellent listeners. They also use setbacks as learning opportunities, offering constructive, actionable feedback tailored to their team’s needs.
Goal setting and planning

Managers help staff set clear goals and develop actionable plans to reach them. Often, this involves long-term objectives that align employees’ career aspirations with overarching company goals.

When coaching management works best

The coaching management style is most effective when businesses prioritize long-term employee development. It offers room for accelerated growth and encourages employees to stick around and grow with the company.

Below are some instances where coaching management excels:

  • When you’re struggling to retain employees. A coaching management style can lead to higher job satisfaction, better performance, overall well-being and increased employee retention. When you offer personal coaching and professional development opportunities, employees feel valued. The more supported they feel, the more likely they’ll stick around and stay engaged.

  • When employees need to hone their skills on the job. Employees often learn vital skills through hands-on experience in fields like healthcare, education and sales and marketing. In these specialized roles, ongoing real-time learning and feedback allow team members to keep up with industry advancements and achieve faster professional growth.

4. Transformational management

Transformational leadership focuses on employee development, growth and innovation. Transformational managers encourage team members to take on new challenges and strive to achieve ambitious goals.

Transformational managers encourage creativity and hard work to push their teams beyond what they’d achieve on their own. They keep raising the bar to help employees grow with the company.

To build an agile, empowered team, a skilled leader must strike a balance between realistic expectations and challenges that keep the team motivated and engaged.

Characteristics of a transformational management style

Inspirational motivationTransformational leaders have a clear vision that they communicate. Like a visionary leader, they inspire their team with a compelling picture of the future and rally everyone around this shared vision.
Individual challenges and growthTransformational managers challenge their teams to think critically, question assumptions and approach problems from new angles. They often require employees to venture outside their comfort zones.
Emphasis on changeTransformational leaders create an environment where change is possible. They promote continuous improvement, both in their employees and in the company as a whole.
Leading by exampleTransformational managers serve as role models. They earn trust and respect by demonstrating a strong individual sense of commitment and purpose.

When transformational management works best

A transformational management style can increase motivation, drive innovation and lead to better performance.

Transformational management works best in these contexts:

  • When your industry is constantly changing. Transformational managers are especially helpful when dealing with change management. They’re invaluable in fields at the forefront of technological advancements, like biotech and software development. Here, leaders can foster adaptability to keep their teams motivated in fast-paced environments.

  • When you need to unlock potential. Transformational leaders excel at identifying and nurturing individual and team potential. They create an environment where employees feel challenged and supported to grow beyond their current roles. Their support and encouragement push the envelope and boost performance on all levels.

3 situation-dependent management styles

Different teams and workplaces will require specific styles of business management appropriate to their needs. Some leadership styles are highly effective only in particular scenarios. Here are three such management styles and when to use them.

1. Authoritarian management

With the authoritarian management style, also known as the autocratic management style, a manager asks for little to no input from team members. Leaders make decisions based on their judgments, rarely considering others’ opinions.

Autocratic management takes a task-oriented, top-down approach.

Characteristics of an authoritarian management style

Centralized decision-making and limited employee inputThe manager has total control over final decisions and expects employees to follow instructions without question.
Clear expectations and instructionsLeaders provide clear directions about what employees need to do and how and when they should complete it.
Strict supervision and monitoringAuthoritarian managers micromanage their team members to ensure they’re up to standard.

When authoritarian management works best

An authoritarian management style may seem like a thing of the past, but there are still scenarios where it’s the preferred option. For example:

  • When work is routine and needs to follow strict protocols. An authoritarian manager ensures that employees stick to procedures and guidelines. This regimented approach is crucial in industries where compliance matters, like manufacturing and healthcare.

  • When it’s an emergency or high-stakes environment. In a crisis, quick decisions can save lives or mitigate risks. Authoritarian management makes for faster decision-making than more democratic approaches, leading to faster action.

  • When employees lack skills or knowledge. The autocratic management style provides direction and guidance when the workforce lacks the knowledge to make informed decisions. For instance, close supervision can be beneficial in entry-level or training scenarios.

2. Transactional management

In transactional management, leaders use incentives to get employees to follow their orders. If an individual performs their role well, they receive a reward as encouragement. Generally, this management style is effective for routine business management.

Characteristics of a transactional management style

Clear structure and regulationTransactional managers establish well-defined roles and responsibilities. They rely on policies and procedures to ensure staff complete tasks correctly.
Goal-oriented workManagers set specific, measurable goals. They determine an employee or team’s success according to their ability to meet these objectives.
Rewards and punishmentsThe transactional management style uses a system of rewards (like bonuses or promotions) to motivate employees to accomplish goals. It also responds with punishments (like reprimands or demotions) when staff falls short of business and performance objectives.
Performance monitoring

Transactional managers monitor team members closely, often with regular performance reviews, to make sure they comply with standards and procedures.

When transactional management works best

The transactional management style is useful when there’s a need for tight organization, efficiency and stability. Let’s consider a few instances where transactional management can be effective:

  • When tasks and outcomes can be measured and linked to rewards. Transactional management provides effective incentives in industries with specific, measurable outcomes. For example, sales teams often receive bonuses for achieving sales targets and quotas.

  • Where tasks are predictable and routine. Transactional management is useful with repetitive, clearly defined tasks such as in assembly lines or call centers. This approach ensures consistent results through well-defined expectations and rewards.

  • When meeting deadlines is critical. A transactional management style provides a clear framework for rewards and punishments to promote accountability, helping ensure that employees follow timelines closely.

3. Laissez-faire management

Laissez-faire management, or the delegative management style, encourages employees to make decisions and manage their own work. Laissez-faire managers monitor their teams but take a mostly hands-off approach. This style can be effective with self-motivated employees who don’t need much guidance.

The characteristics of a laissez-faire management style:

High level of autonomyEmployees have the freedom to make their own decisions without constant oversight. Managers trust their teams’ abilities and give them the space to work independently.
Hands-off approachManagers only check in when necessary, giving employees full responsibility for their day-to-day work.
Supportive environment

A laissez-faire manager is more of a facilitator than a manager. They offer all the support and resources their team needs to succeed.

When laissez-faire management works best

This style works best with highly experienced and self-directed people who can work independently. Below are some situations where you might apply laissez-faire management successfully:

  • When you want to promote creativity. In creative environments, laissez-faire management lets employees explore new ideas and do their best work without being restricted by management oversight.

  • When leading highly skilled and self-motivated teams. This management style works well with expert team members who need minimal supervision. It can support specialists working on innovative projects that require a lot of experimentation, including those in research and development roles.

  • When managing remote or virtual teams. A laissez-faire management style relies on trust and discipline. In flexible or remote work environments, it enables self-managed employees to balance their workload with personal commitments.

How to adopt a new management style

Adopting a new management style requires trial and error. It may take time for you to feel comfortable with it, especially if it’s different from how you usually operate.

Here are a few steps you can take to streamline the adoption process and get on board faster:

1. Identify your current management style

Before adopting a new management style, you need to know what you’re starting with. Use the following activities to determine your current style:

  • Self-reflection. Set aside time to reflect on your management practices. Think about how you communicate, delegate tasks and respond to situations. Then, compare your observations with the management styles explained above.

  • Management style assessments. Carry out an assessment to gain insights into your typical response. Many psychology and leadership websites offer quizzes to help determine your leadership style, such as PrinciplesUs, Leadership Practices Inventory and Hogan Assessments.

  • Team feedback. Seek employee feedback about your management style and its effectiveness. Ask specific questions like “How do you feel about the level of guidance and autonomy you receive?” and “Do you feel your input is valued?”

2. Define your new management style

Your next step is understanding what you hope to achieve with the new management style.

Let’s say your goal is to boost employee morale, improve productivity or align better with corporate culture. Consider what you can improve if you’ve received feedback that your current management style isn’t ideal.

Next, research different management styles to find one that aligns with your team, industry and specific challenges. Identify its core principles and practices to make sure they apply to your context.

For instance, if you choose a coaching management style, note that it emphasizes mentorship, continual learning and professional development. Based on that, you may decide to create personalized development plans for employees.

Outlining how you will progress will ensure a smoother transition to your new management style.

3. Start adapting to your new management style

Adapting to a new management style takes time. First, let your team know you plan to change your management style. Tell them why and what you hope to achieve with the change. Give them the opportunity to weigh in before you start making changes.

Once the team is on board, start implementing the new management style gradually. Begin incorporating elements of your chosen management style and observe their impact.

For instance, if you’re going with the coaching management style, introduce one-on-one coaching sessions with team members first. As they start to see results, add employees to projects where they can learn new skills as they go.

As you introduce new elements of your management style, seek feedback from your team on how things are going. Then, adjust your approach based on their thoughts, experiences and results.

4. Consider professional development and training

Professional development can help leaders thrive within a new managerial framework. Look for opportunities geared toward helping you grow and adapt to new leadership styles in management.

You could:

  • Hire a coach or mentor who can provide guidance and support

  • Attend leadership development programs, workshops and seminars

  • Study different management styles and learn the potential challenges of the style you want to adopt

  • Read books, articles and case studies from experts in the field

Note: Mastering your new management style and integrating it into the organizational culture will take time, patience and consistency.

Final thoughts

Selecting the right management style is crucial for leading a successful team, whether in sales or otherwise.

From an autocratic style to a laissez-faire method, each approach has unique benefits and applications. Make a conscious effort to experiment with different managerial styles and tactics to progress from good manager to visionary leader.

If you’re a sales leader, you can enhance your strategy for effective management with Pipedrive’s all-in-one CRM software.

Sign up for a 14-day free trial to streamline your sales processes and empower your team to deliver on their targets.

Driving business growth