The ideal leadership blend for Stage 3 is Coaching, Democratic, and Pacesetting.
A Stage 3 leader mentors the team, fosters a collaborative environment of trust and respect, and upholds high standards of success. This blend of leadership styles mixes strong people-focused styles (Coaching and Democratic) with enough Pacesetting to keep the rapidly growing team moving forward in the right direction.
Primary Leadership Style: Coaching
The Coaching leader communicates a belief in people's potential and an expectation that they do their best. The coach regularly provides feedback and instruction and is willing to put up with short-term failure if it furthers long-term learning.
In Stage 3, the Coaching leader should be intentionally investing in the Management Team. Developing this layer of the organization will pay dividends in later stages, so it’s important to identify and groom the leaders who can oversee the staff and functional areas of the business.
In this Delegation Stage, having a Coaching leader who invests in the Management Team and delegates responsibility to them is necessary to help the organization transition from being owner centric to enterprise centric.
Secondary Leadership Style: Democratic
Democratic leaders forge consensus through participation. They focus on promoting harmony in the organization while building a relationship of trust and respect with employees. The hallmark of Stage 3 is the transition from owner-centric to an enterprise-centric organization. In this transition, the leader of the organization is forced to relate to the business in a different way.
The leader must allow the organization to take on a life of its own. The staff takes a much greater role in the organization—becoming the layer that is most critical to the company’s growth and success—and so the leader must involve the staff to a greater degree. Creating buy-in or obtaining input from valuable employees is key to being a Democratic leader.
Tertiary Leadership Style: Pacesetting
Pacesetting leaders hold and exemplify high standards for performance. They set the bar for success and show through their actions both what it looks like and that it’s achievable. In Stage 3, the Pacesetting style is important to push the organization to continue improving and moving forward. Even though the leader is no longer doing as much of the work (i.e., no longer directly handling as much of the day-to-day services), the example they set has a major influence on the rest of the company.
The Pacesetting style, when combined with the Coaching and Democratic styles, helps to develop a capable Management Team, and moves the organization away from being dependent on the leader for daily tasks.
Leadership Style Blend Misalignment
A law firm has moved from Stage 2 to Stage 3 in the last year. Led by a high-profile litigation attorney, the firm has always been based on the CEO’s hard-charging personality. The success they’ve had is mostly credited to his ability to bring in new clients and to attract like-minded attorneys who are also assertive and high-energy.
As the firm grows larger, there is a bigger base of employees (other attorneys, paralegals, and administrative staff) who don’t see the benefits from his Commanding style. Instead, what they experience is a workplace where everyone is afraid to cross the CEO and no one has authority to make a move without him. Rather than feeling energized by new work that comes in, they are instead focused on not making any mistakes to avoid being berated in front of the team. The more talented attorneys start to leave, and the administrative staff is constantly changing, which hinders the flow of work. The CEO’s response is to put his head down and work even longer hours, but he’s not able to keep up with the large volume of work and he doesn’t understand why no one is following him anymore.
This CEO has relied on the Commanding and Pacesetting leadership styles to get him where he is today. With a larger office to manage, though, he needs to start investing time into the people who work for him. He can’t handle all of the work on his own, but he also can’t expect his employees to be enthusiastic about the work when they aren’t empowered to do anything beyond the immediate tasks in front of them. By coaching his team and demonstrating respect (asking for feedback and working for buy-in), he would get better quality and more quantity of work from his team.
The concepts from this article were taken from The Delegation Stage: Organizational ReWilding Rules for Business Growth. Available through The ReWild Group and Amazon, the book explores in-depth this and other concepts while providing illustrations to help business leaders incorporate the ideas into their organizations. Get your copy today to learn the rules for growth for companies with 20-34 employees.