If you were to describe your leadership style, what would you say? If you were to define the leadership style of your credit union, what adjectives would you use? Like it or not, we all have a leadership style, and if your credit union has not defined their preferred leadership style, you have many varieties, and some styles likely conflict with others styles.

Why is leadership style important?

One of the main reasons for failures in succession plans results from significant leadership style differences. Recently a $B credit union went through a painful succession plan fail when the “heir apparent” to a retiring CEO brought an entirely different leadership style. It was so far from the prior leadership style that the credit union suffered from a significant brain drain, the exit of several key employees because of this leadership climate change. The board was required to retract the succession plan and start a new CEO search.

In new hires, promotions, or even lateral transfers of management staff, a clearly defined leadership style can set this new, promoted, or transferred employee up for success or failure. If a leader who believes in “consensus” leadership takes over for a “command-control” leader, the employees will be confused about their authority and expectations. When this happens, undue job stress is created, and productivity suffers.

What are the leadership styles?

Command-control = this style of leader takes on all of the decisions for the business unit. This style can be a continuum but is always very hierarchal and can often be seen as a “my way or the highway” style. Teams that report to the command-control leader often abdicate all decisions to the leader and expect to be told what to do and their work priorities. The climate created is often fear-centric, and often passion and innovation are lacking.

Consensus = this style is often seen as “leadership by committee.” When this style is not partnered with a culture of execution, decisions are often delayed or end up in the never-ending cycle of analysis. Seldom does this style result in a flexible, fast-moving, or innovative company.

Servant Leader = this style stems from the philosophy of “if you take care of the employee and empower them to own their jobs, they will take care of the manager and the company.” This style is often very interactive and requires management to listen carefully to the voices of the staff to ensure the manager and the organization are meeting the employee’s needs.

Leadership from your Chair = This leadership style acknowledges that each employee in the organization is an expert at their job, and as a result, they need to have a voice in any decisions that impact their job. This style requires all employees, not just management, to see themselves as leaders and ready, willing, and able to lead up, horizontally, and down.

Choosing the accepted leadership style for an organization is not just simply picking one of the above styles. It requires steps:

1. Understand the different styles that exist today – this is a dedicated project, usually by a leadership coach, that defines the executive style and the style by business unit, department, and team. It is typically done with a survey of management and their direct reports. This effort identifies the leadership inconsistencies that exist across the organization.
2. Identify the preferred leadership style the credit union wants to make as the standard. This is usually a facilitated session with the executive team to establish an agreed-upon style the organization wants to adopt in the future.
3. Using the initial leadership survey research, identify the gaps between what the organization wants and what they have now. This gap analysis aims to understand whom the organization needs to “re-train” and a training process, system, style, and how to measure leadership performance.
4. Set a hiring and promotion process in place that has a screening function for leadership fit. Ideally, this is a pre-screen that is done by HR before the hiring manager interview. If the candidate fails this leadership fit interview, the candidate is removed from the hiring process. This step is essential because a hiring manager will naturally focus on the skills and execution potential of the new hire or promotion candidate, and those criteria may often trump the leadership inconsistencies.
5. Make leadership style measurable for performance management and even incentives/bonuses. All management staff needs to be trained on how to coach leadership strengths and weaknesses and how to observe and measure how well the manager or aspiring manager is leading.

In any organization, leadership style takes ongoing effort and focus. Often we will find that the leadership style of an organization will often be a hybrid of the styles noted above. A Servant Leader can also be a consensus leader and foster a Leading from your Chair. Also, there may be times when execution becomes a dominant organizational need that requires management to become more of a command control type leader. Having leaders who understand the different styles and the strengths and weaknesses of each style is essential to adapt the style driven by circumstance but with an inherent tendency and preference to the identified organizational style. This management flexibility is important to effectively adapt and adjust to managing business needs and performance needs.