9 Leadership Styles for Entrepreneurs

As entrepreneurs, we wear many hats—CEO, developer, consultant, HR, even janitor.  But no hat is more important than that of “boss”.  As an entrepreneur, you’re not only your own boss, but you may also be the superior to employees in your organization.  And trust us—it’s not an easy role.

Understanding your leadership style is one of the most important steps you can take as a leader in your startup.  By learning about what leadership style is most effective, what type of leader you are and how you can improve your leader qualities, you can help build a positive startup culture. 

President Harry S. Truman once said, “Men make history and not the other way around. In periods where there is no leadership, society stands still.  Progress occurs when courageous, skillful leaders seize the opportunity to change things for the better.”

And if developing leadership skills is that important, than reading this article is mission-critical.  Check out the nine different entrepreneur leadership styles and how they can make or break a startup—which one do you fit?

1.  Transformational Leadership

Transformational leaders are those who, no matter how busy they may get, continue to inspire teams and influence subordinates to improve and/or change.  Imagine an enthusiastic, charismatic, passionate entrepreneur—he or she is also a transformational leader.  This is one of the most effective leadership styles known today because it changes mindsets, social culture and work efficiencies. 

Famous transformational leaders: Sam Walton (Wal-Mart), Herbert D. Kelleher (Southwest Airlines) and Jack Welch (General Electric)

2.  Charismatic Leadership

Charismatic leaders are known to be the driving force that inspires teams to deliver above what is expected of them.  These leaders often use personal charm to lead and inspire and tend to be universally respected and admired.  A charismatic leader is one that knows how to “work the room” and pays attention to the details when doing so.  Charismatic leaders are famously known for their ability to gather a large number of followers.

Famous charismatic leaders: Thomas Watson, Sr. (IBM), Mahatma Gandhi

3.  Participative Leadership

Using participative leadership, entrepreneurs will ask for input and advice from all team members involved in the startup.  This type of leadership makes every team members’ opinion an important one and employees quickly become part of the decision-making process.  This kind of leadership style makes everyone involved in the startup feel appreciate and highly motivated. 

Famous participative leader: Donald Trump (Trump Organization)

4.  Laissez-faire Leadership

Do not get participative and laissez-faire leadership mixed up!  Participative leadership has been proven very successful, while laissez-faire, although similar in nature, often results in startup failure.  Laissez-faire entrepreneurs are often hands-off and allow group members to make all decisions.  This leadership style leads to the lowest productivity among group members.

Famous laissez-faire leader: Thomas Jefferson

5.  Transactional Leadership

Transactional leadership is established by incorporating rewards and punishments in day-to-day work-life.  Using the transactional method usually results in a very clear chain of command.  Transactional leaders often believe that people perform better with a chain of command, a rewards and punishment system and heavy monitoring.  Transactional leadership has been found to be quite ineffective apart from situations where problems are simple and clearly-defined.   

Famous transactional leaders: Joseph McCarthy and Charles de Gaulle

6.  Autocratic Leadership

When an entrepreneur uses autocratic leadership, they are setting themselves up for failure.  Autocratic leaders wield with absolute power and do not listen to employees.  Many entrepreneurs feel like autocratic leadership is the best option since they will have complete control over their idea and their business.  However, this leadership style is often resented by employees and tends to lower self-esteem and office morale.    

Famous autocratic leaders: Some would say Steve Jobs (Apple) was an autocratic leader

7.  Situational Leadership

The situational leadership style, much like the transformational leadership style, is one of the most successful known today.  This type of leader adapts to situations, abilities of teams and his own capabilities with ease.  It’s all about situational adjustment and adaptation. 

Famous situational leader: Dwight Eisenhower

8.  Service-oriented Leadership (or Servant Leadership)

Service-oriented leaders put the needs of their employees ahead of their own at all times.  They often rely strongly on subordinates’ values and ideals and involve their teams heavily in the decision-making process.  Service-oriented leaders are often empathetic, collaborative and ethical.  Entrepreneurs with this leadership style encourage teamwork and long-term goal making. 

Famous service-oriented leaders: S. Robson Walton (Wal-Mart), George Washington

9.  Quiet Leadership

Quiet leaders lead by example, not by telling people what to do.  Quiet leaders are not known for speeches, statements and clear-cut orders.  Instead, they do what needs to be done and inspire others to do the same.

Famous quiet leaders: Rosa Parks and Abraham Lincoln. 

Which leadership style is best for an entrepreneur?  Successful entrepreneurs tend to be a combination of a few leadership styles including transformational, charismatic, participative and situational.  Whatever leadership style you decide to follow, it is important to remember that not all styles will work for the same individual or organization.  Do what’s best and focus on what improves your chances of startup success! 

Follow me! @AllisonThinkBig

Dave Ramsey Presents a New Breed of Entrepreneur: The EntreLeader

Why be an entrepreneur when you can be an EntreLeader?

Dave Ramsey has been brave enough to ask this question:  Who is more important in a business, an entrepreneur or a leader?

And after years and years of analyzing who truly is more beneficial in a business environment, only one answer came to mind:  the EntreLeader; a new breed that Dave Ramsey holds to be the most important type of person that can come into a new business situation.  The EntreLeader brings the drive and motivation of an entrepreneur and the strength and vision of a leader, all rolled into one.

But how do you find EntreLeaders?  And even more importantly, how can you develop into one yourself?

 

Dave Ramsey has found a way.  He started out by pouring himself into his top three guys, but he quickly realized the information needed to be passed down to the whole team.  So he started holding classes once a week for all current and future leadership.  As he taught the sessions each week, more and more outside visitors began sitting in.  When the guests outnumbered the team members, Dave realized that the world outside his company was hungry for a new way to do business!  That’s when the EntreLeadership workshop was born.

Great news, KC entrepreneurs: the EntreLeadership workshop is coming to Kansas City!  Join Dave Ramsey this Friday, March 4, 2011 at the Kansas City Convention Center.  Tickets are $99, but if you use the Groupon discount, you’ll get 51% off (and save $50!).  Hurry—you only have 1 day left to buy on Groupon!

Whether you’re an individual who wants to develop your leadership abilities, a business or organizational leader who wants to develop your team, or an entrepreneur who wants to build a business on solid, proven principles, EntreLeadership is for you.

Register today!

Written by Allison Way.  Allison is a writer for Think Big Partners, Kansas City’s mentorship-based startup accelerator and business incubator.  To read more of Allison’s work, check out the Kansas City Entrepreneurship Examiner and her articles on Helium, BrooWaha and eZine.  Follow Allison! @AllisonThinkBig

More Veteran's Day Lessons for Entrepreneurs (Part 2) - Colin Powell's Leadership Presentation

Today is Part 2 of our Veteran's Day post. So...entrepreneurs listen up! Stand tall and prepare for inspection! I hope your boots are shined, your mind is open and you are ready to learn the invaluable lessons from General Colin Powell (Ret)!

Colin Powell's Leadership Presentation

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Thanks again to all Veteran's for keeping this country free! And also thanks to all entrepreneurs, business owners and anyone who is working to support the American Dream. We need you now more than ever!

Written by Herb Sih, Managing Partner of Think Big Partners and bizperc, Kansas City's newest entrepreneurial resource.

Adapt, Improvise, Overcome – Celebrating Veteran’s Day with 3 Lessons from the Military that Mean Entrepreneurial Success (Part 1) PLUS Colin Powell’s Lessons on Leadership (Part 2)

As a former military pilot and veteran, I understand the absolute mindset that goes into accomplishing the mission, no matter what the risk or cost. Simply put, there are times when failure is not an option, and our military deals with that stark, binary reality every day.

As a serial entrepreneur, I also understand the challenges that exist to start up a successful business venture. While the risks may not be “life and limb”, the economic risk and realities of failure certainly can test the mettle of the strongest entrepreneur’s will.

Here are a few quick lessons that I have learned in my decade served in the military. Additionally as an added Veteran’s Day bonus, the timeless lessons on leadership from General Colin Powell are presented as well. So…entrepreneurs….ATTEN–SHUN! Drop and give me 10 (minutes) that can hopefully make a difference between success and failure in your mission as an entrepreneur!

1. Adapt, Improvise, Overcome

The US Marines don’t make excuses, they just get the job done and so do most successful entrepreneurs. This Marine Corp unofficial motto suggests that knowing you have to deal with whatever life (or business) hands you and still make it work is essential to success. It doesn’t matter that most businesses fail in the first 5 years…you have a mission to accomplish!

This is one mindset that should be the primer for any budding entrepreneur – or be the gut check for anyone not willing to embrace this harsh reality.

2. Always have a Plan B and maybe a Plan C

There is a saying that the best laid plans can come undone, as soon as there is enemy or situational contact. As a former military pilot, I can attest that even on a good day with “a full bag of gas, clear blue and twenty-two” (ask a pilot what this means if you don’t know), it always pays to have Plan B in the back of your mind. Whether it is engine failure, a stray round that finds you (affectionately known as the “golden bb”), bad weather that comes out of nowhere or a whole host of other problems, you better have a backup plan to whatever you do. The same goes for a startup or entrepreneur – have a backup plan or two, because it is unlikely your first plan will survive 100% intact once you actually start.

3. Ready to Lead, Ready to Follow, Never Quit

This is the official motto of the US Navy Seals, the most lethal military unit in the world. Made up of men that redefine the words courage, valor and integrity under pressure, these silent warriors fight a battle that the average citizen will never understand or even be aware of to the fullest extent.

I have flown these men during my time overseas. They are smart, motivated, highly disciplined, yet also extremely creative. They do not follow orthodox methods for mission success. But they all share a secret that many business people and entrepreneurs can benefit from knowing.

This secret is based on versatility and understanding your role in the mission’s success. Today’s lower ranking man could become tomorrow’s leader, either through promotion, demotion, attrition or casualty – so you better be a good follower and a good leader, and ready to go back and forth as the situation dictates. Lead from the front, but know what it’s like to be in the rear. And sometimes the difference from being in front and being in the rear is the direction you are going at the time –which can change fast.

Entrepreneurs need to recognize their role, value and function in the equation for their business success. You also need to be smart enough to respect your team member, never confusing “rank” for “authority or expertise”. Entrepreneurship is not a democracy and someone needs to be in charge, but you better check your ego at the door and be prepared to lead, follow – and never quit – if you want to make it big. Teamwork trumps individual efforts. So be ready to Lead, Follow and Never Quit.

Lastly, be sure to remember this Veteran's Day that freedom is never free. If you like the FREEDOM to be an entrepreneur, be sure to thank a Veteran. They will never ask you to thank them, but deserve more thanks than many of us will ever know. For a great video, check out http://www.youtube.com/watch?v=A-os49HaKok

Thank you to all Veteran's on this Veteran's Day. Tomorrow Part 2!

Written by Herb Sih, Managing Partner of Think Big Partners and bizperc, Kansas City's newest entrepreneurial resource.