Payset prespective
April 10, 2024

The 6 Most Common Leadership Styles and How to Find Yours

Understanding the most common leadership styles is crucial for effective leadership.

Key Takeaways:

• Understanding the most common leadership styles is crucial for effective leadership.

• Self-reflection, feedback, experimentation, mentorship, assessments, observation, and training are essential steps in identifying and refining your leadership style.

• Embracing a proactive approach to exploring and refining your leadership style enhances your effectiveness and fosters growth and success within your team and organisation.

Here Is a Breakdown of the Most Common Leadership Styles

Transformational Leadership 

Transformational leadership is characterised by a leader's ability to motivate their followers to strive for results beyond baseline expectations. Key characteristics of this type of leader include a clear vision, excellent communication skills, empathy, and a strong sense of how to develop and empower team members. 

Transformational leaders can have a profound impact on team motivation and potential. By presenting a vision and inspiring a sense of purpose, they can harness collective ambition in their team. They encourage creativity, risk-taking, and thinking outside the box, promoting an environment where fresh ideas are welcomed and pursued.

Transformational leaders encourage their team members to challenge the status quo, experiment with new approaches, and contribute their personal perspectives. This can result in continuous improvements and breakthroughs.

Laissez-Faire Leadership   

Laissez-faire leadership, sometimes known as the "hands-off" approach, is characterised by leaders who provide minimal guidance or direction to their team members. Instead of closely supervising or micro-managing, these leaders entrust their employees with autonomy and decision-making authority. This style allows members to work independently, take ownership of their tasks, and come to solutions without the leader obstructing the process.

Laissez-faire leadership is most effective in situations where team members are skilled, experienced, and self-motivated. It is well-suited for creative and knowledge-based industries where employees have specialised expertise and thrive in an environment centred around freedom and flexibility. This leadership style can be especially beneficial during times of crisis or urgency, where quick decision-making and agile responses can happen without the need for leadership approval.

Authoritative Leadership  

Authoritative leadership is marked by a leader’s ability to provide strong direction to their team. This type of leader has a skill for articulating a convincing vision for the future and establishing well-defined goals aligned with their organisation's objectives. They communicate assertively, outlining the role each team member plays in achieving shared goals. This creates a sense of purpose and dedication among team members. 

Authoritative leaders offer guidance, support, and encouragement as projects move forward, mobilising their team members to embrace their responsibilities and empowering them to take action. Through their decisive approach, authoritative leaders can steer a cohesive team capable of achieving ambitious objectives.

Transactional Leadership 

Transactional leadership operates on a system where leaders set clear expectations and establish a framework of rewards and consequences for achieving or failing to meet them. This system is characterised by its transactional nature, where employees are motivated by incentives such as bonuses, promotions, or recognition for successful performance, while underperformance may result in penalties such as reprimands or reduced privileges. 

Efficiency and routine focus are paramount in transactional leadership, as leaders emphasise adherence to established procedures and standards to ensure smooth operations and consistent outcomes. This leadership style prioritises stability and order within the organisation, often relying on well-defined processes and hierarchical structures to achieve predefined objectives.

Democratic Leadership 

Democratic leadership emphasises the active participation of team members in the decision-making process, promoting an environment where everyone's input is considered and valued. This allows for a diverse range of perspectives and ideas to be heard, leading to more informed and effective decisions. By involving team members in decision-making, democratic leaders promote a sense of ownership and empowerment among their employees, increasing their commitment to organisational goals.

One of the key benefits of democratic leadership is its ability to foster collaboration and equality within teams. By encouraging open communication and sharing of ideas, democratic leaders create an inclusive environment where individuals feel respected and valued. This trust and mutual respect among team members can lead to greater job satisfaction and overall organisational success.

Situational Leadership  

Situational leadership is a dynamic approach where leaders adapt their style to meet the changing needs of their team and the situation at hand, recognising that there is no one-size-fits-all approach. Adapting their leadership style to team needs and situations involves assessing factors such as team experience, skills, and motivation levels, as well as the complexity of the task at hand. Based on this assessment, leaders can choose from a range of styles, from more directive approaches for inexperienced team members to more participative or delegative approaches for those who are more skilled and motivated. By being adaptable, situational leaders can effectively navigate a wide variety of challenges and opportunities, giving them the tools to lead their teams to success in any situation. 

How to Identifying Your Leadership Style


Self-reflection is the first step in identifying your leadership style. It helps you understand your personal values, beliefs, and goals, which ultimately shape your approach. By gaining clarity on what truly matters to you, you can align your style with your core principles, leading to more authentic and effective leadership.

Reflecting on past leadership experiences is also essential. It allows you to analyse your strengths, weaknesses, successes, and failures, giving you valuable insights into your leadership tendencies and preferences. This self-awareness enables you to capitalise on your strengths and address areas for improvement, so you can continuously refine your leadership style. Through introspection, you can develop a deeper understanding of yourself as a leader and make considered choices to enhance your effectiveness.


Feedback is a critical tool in identifying your leadership style. Seeking insights from peers, subordinates, and mentors can expose you to a wide range of perspectives on your strengths, and areas for growth. Peers can offer observations from a similar level of experience, while subordinates can be a valuable source of frontline feedback on your leadership impact. Mentors, with their wealth of experience, can offer guidance and constructive criticism to help you refine your style.

Using feedback to adjust and improve involves actively listening to the commentary received and being open to making changes. It requires humility and a willingness to acknowledge areas where improvement is needed. By embracing feedback as a continuous learning tool, you allow yourself to evolve and grow in your leadership journey.


Experimentation is an important process in identifying your leadership style. It involves trying out different approaches to leadership to figure out which one aligns best with your personality, values, and goals. By experimenting with various styles, you can gain insights into what works well for you and what doesn’t. 

Adapting your leadership style to meet the needs of your team and organisation is essential for effective leadership. This flexibility allows you to tailor your approach based on the dynamics of each situation, and to learn more about your style as you continue along the leadership path.


Mentorship plays a key role in leadership development, offering valuable opportunities to learn from experienced leaders. By engaging with a mentor, you can gain insights, guidance, and wisdom accumulated through years of practical experience. 

The benefits of having a leadership mentor are many, including accelerated learning, enhanced self-awareness, and expanded professional networks. Mentorship fosters a culture of continuous learning that empowers leaders to reach their full potential and make meaningful contributions to their organisations and communities.

Leadership Assessments

Leadership assessments are designed to help people identify their strengths and weaknesses in various aspects of leadership. These assessments typically involve self-assessment questionnaires and quizzes, 360-degree feedback surveys, and psychometric tests that measure different leadership traits, skills, and behaviours. 

By completing these assessments, you can gain valuable insights into your particular style, preferences, and areas for improvement, incorporating tools like targeted development plans, goal setting, and tracking progress over time.


Learning from admired leaders by studying their behaviours, decisions, and approaches to leadership is highly valuable, offering insights into effective practices and techniques, such as how they communicate, make decisions, inspire others, and navigate challenges. Identifying traits and behaviours that resonate with you is a direct route to incorporating these elements into your own leadership style. 

Training and Development

Training and development are practical ways to identify and refine your leadership style. Leadership courses and workshops provide structured learning opportunities and exposure to various theories, strategies, and best practices. By actively seeking out opportunities for growth and development, you can refine your leadership capabilities, adapt to evolving challenges, and stay updated on industry trends. Investing in training and development not only strengthens leadership skills but also demonstrates a commitment to personal and professional growth.


Knowing the essential leadership styles and understanding and identifying yours is fundamental to your growth as a leader. Through self-reflection, feedback, experimentation, mentorship, assessments, observation, and training, you can gain invaluable insights into your strengths, weaknesses, and areas for development. 

Leadership is a journey of continuous learning and evolution. Embracing a proactive approach to exploring and refining your leadership style not only enhances your personal effectiveness but also fosters growth and success within your team and organisation. 

Reflecting on Your Leadership Style

No matter how much experience you already have, it is always worth taking a moment to reflect on your leadership style. Carefully consider the impact you have on those you lead and whether your current approach aligns with your values and goals. 

If you're unsure or looking to further develop your leadership skills, consider engaging with leadership assessments or seeking mentorship. Assessments can provide valuable insights into your strengths and areas for improvement, while mentorship offers guidance and support from experienced leaders. By investing in your growth and development as a leader, you not only enhance your effectiveness but also empower yourself to drive positive change with everyone you work with.

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A Payset multi-currency account allows startups and business owners to receive payments from clients virtually anywhere in the world and pay suppliers, staff, and contractors quickly and affordably in their chosen currency.

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