Leadership Styles That Are Shaping The Future Of Business

Megan Stacy Deane

Posted: April 8, 2024

Table of Contents

There have been significant changes in business leadership styles over the last five years. Globalisation, technological disruption, changing demographics, and evolving consumer expectations have shifted how companies are run and how employees are managed. 

The new trends in leadership styles bend towards transformational, adaptive, purpose-driven, inclusive, and impactful approaches. Let’s look at what this means for those in leadership positions. 

The five most important leadership styles

Often, a leader doesn’t just adopt one of these styles but could incorporate a combination of them when managing people and processes—there isn’t one default “best” way to lead.

Transformational leadership

Transformational leadership is an approach that results in positive change (transformation) within individuals. It gives team members a sense of identity about the business’s overall mission and the confidence that they can make a difference.  

Transformational leaders typically act as role models for their followers; they challenge them to take greater ownership of their work and understand their strengths and weaknesses. They (gently) push employees outside their comfort zones, inspire and empower them to own their work and give them the freedom to innovate. 

One study showed that transformational leaders could help employees ‘buy in’ to the company’s goals more effectively (helping them realise that their work is valuable in reaching business goals) and also give them a sense that achieving them is quite doable.

Adaptive leadership

Two of the most important characteristics of adaptive leaders are their growth mindset and a high tolerance for ambiguity (accepting unclear, uncertain, or new situations on the fly).

Adaptive leaders embrace change, question the status quo, and grow themselves and their company through constant adaptation, learning, and experimentation. They encourage employees to take risks and learn from their own mistakes.

This type of leadership is similar to what some call ‘situational leadership’, where the leader’s flexibility and emotional intelligence allow them to quickly understand what a specific scenario requires and change tack to keep projects on track. 

They’ll do this by seeking input from team members, creating a safe space to share ideas (and make mistakes), and providing support and encouragement as they adapt goals or priorities.

Purpose-driven leadership

Purpose-driven leadership means helping employees find personal meaning in their work and creating a committed workforce that thrives on shared goals and aspirations. 

The first requirement is for the leaders to understand their purpose at work and what value they derive from doing what they’re doing. 

From here, they can articulate a clear, inspiring vision that resonates with direct reports and colleagues. This allows for aligning goals and values between employees and the organisation.

Through value-based decision-making, purpose-driven leaders take time to learn what truly matters to their employees. Critical to the success of this type of leadership is allowing individuals the freedom and permission to consider and discuss their own purpose so that their reasons feel relevant and personal to them. 

Being an effective, purpose-driven leader requires good communication, negotiation, collaboration, ethical decision-making skills, and a good dose of emotional intelligence.  

Inclusive leadership

In South Africa, The Odgers Berndtson South Africa Leadership Diversity Report 2022 showed that only 40% of respondents said their organisation had a board committee responsible for the organisation’s Inclusion and Diversity agenda. When you combine that with Deloitte research that shows that diversity and inclusion are critical priorities for socially conscious Gen Z professionals, who will constitute the majority of the global workforce in the coming years, it’s clear there’s an urgent demand for leaders who prioritise inclusivity.

Additionally, the prevalence of remote and hybrid work means leaders and managers will be working with employees from all over the world. For leaders to effectively navigate these and other impacts globalisation has on businesses and workforces, inclusivity must be a key strong point of managing their businesses. They must create a working environment where all team members are respected and valued and have equal access to resources and opportunities. 

Inclusive leaders can quickly adapt to diverse scenarios and alternate perspectives. They are open-minded and non-judgemental and able to recognise bias when it occurs. Their cultural intelligence, or intercultural fluency, is an essential leadership competency for forming business strategies that boost employee engagement, secure diverse talent, and engage diverse suppliers.

Research shows that, when done right, teams perform better and more collaboratively and make better overall decisions.

Impactful leadership

Impactful leaders empower those who work for them by fostering a culture of personal responsibility, autonomy and accountability. They have a high level of clarity on their principles and values, which guide their behaviours, decisions, intentions, and impact on others.

Key traits of impactful leaders are emotional agility, a clear sense of purpose, systems thinking (critical in handling the complexity facing the world in the coming decades), openness and transparency, and authenticity. 

However, the most crucial aspect of leading with impact is being able to lead yourself and take ownership of your personal leadership journey and mastery. Self-leadership is vital to surviving and thriving in uncertain, volatile, and ambiguous situations and enables leaders to overcome personal and professional challenges. It boosts their self-awareness and helps them improve self-direction by learning, unlearning, and relearning.

Impactful leaders have a sense of selflessness and an attitude of service to others. They stay calm under pressure and act with compassion and care. Importantly, they see and value every individual’s contribution and ensure they provide the necessary resources and support for individuals to thrive.

Learn to lead into the future with MasterStart

Purpose-driven leadership will become a coveted skill as organisations navigate diverse workforces and a fast-changing world. Our eight-week online course, Strategic and Purpose-Driven Leadership, provides learners with the theoretical and hands-on knowledge they need to better align an organisation’s strategic visions with its business goals.

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