…How leadership styles shape organisational culture

Written by Vera Njong

Organisational culture refers to the shared values, beliefs, and attitudes that define an organisation’s identity and guide its employees’ behaviour. It can be thought of as the personality of a company or organisation. Just like people have unique characters that make them who they are, organisations also have a unique personality that makes them different from other organisations. Culture influences employee experience, including how employees feel when they go to work, how they get along with their coworkers, how much they like their job, and what they think about their boss. It is thus a critical aspect of every organisation and has a significant impact on the growth and achievements of the organisation.

Leaders can significantly influence and shape the culture of their organisations in the way that they interact with employees, make decisions and communicate the organisational goals and vision. It thus comes as no surprise that some of the most notable business leaders of the 21st century used their leadership styles to positively influence the culture of their organisations and enhance organisational growth. This includes figures such as Co-founder and former CEO of Apple, Steve Jobs, Reed Hastings; Co-founder and CEO of Netflix, Jack Ma; Founder of Alibaba, Tony Hsieh; CEO of Zappos, as well as Satya Nadella; CEO of Microsoft.

There are different leadership styles, each with its unique approach, which influences organisational culture in different ways.

makes employees feel valued for their contribution. Transactional leaders typically focus on setting clear goals and measuring employee performance against these goals. These leaders use incentives and sanctions as tools for motivating employees. This style of leadership is most suited for more giant corporations which prioritise bureaucracy and stability.

Autocratic leadership

Leaders who ascribe to this style make decisions without consulting employees and expect complete adherence to their rules and regulations, and decisions. They are generally very authoritative and desire to maintain control over all employees and absolute dominion over the operations of an organisation or department. This leadership style cultivates a culture of fear, insecurity and distrust and makes employees feel powerless and unmotivated. This leadership style often results in a lack of innovation, low employee morale, high employee turnover rates, and many other undesirable effects. Although autocratic leadership does not typically work for most organisations, it may be suitable for organisations that require strict control and command, such as military units.

Participative leadership

This leadership style stimulates a culture of collaboration, teamwork, open communication, trust, respect and shared responsibilities where employees have a sense of ownership leading to job satisfaction, engagement and loyalty. Leaders with this leadership style value employee feedback and employee involvement in decision-making. This best suits organisations that value collaboration, teamwork, inclusivity and innovation.

Servant leadership

Leaders with this leadership style tend to prioritise the needs of their employees over their own needs and ensure to provide support, guidance and resources to help employees grow and succeed. This leadership style fosters community, and culture of empathy, compassion and respect, where employees feel valued and supported. It creates a sense of shared purpose among employees, leading to greater job satisfaction, motivation and loyalty. This leadership style is most suited for organisations prioritising employee wellbeing, personal growth and development, such as; healthcare organisations, educational institutions and most service-oriented organisations.

Here are some examples of common leadership styles and their potential influence on corporate culture:

Transformational leadership

This leadership style is generally most visible in leaders who prioritise creativity, innovation, diversity and growth. It fosters a culture of innovation, development and continuous improvement where employees feel motivated and empowered to take challenges, pursue ambitious goals and develop new ideas and ways of doing things. Transformational leaders inspire and motivate employees by setting high standards, encouraging creativity and providing support, feedback and recognition.

Transactional leadership

This leadership style promotes a culture of accountability, stability, and consistency and

By nature or nurture, leaders will possess one or a combination of these leadership styles. Research indicates that there is a significant causal relationship between specific types of organisational cultures and leadership styles. The secret lies in understanding the organisational goals, identifying the required organisational culture, and adopting the leadership style or combination that cultivates the sort of culture that aligns with strategy. Even the best-laid plans and strategies can fail if the organisation’s culture doesn’t support and align with them. It is therefore crucial for leaders to prioritise building a healthy and supportive culture where employees are motivated, engaged, and committed to achieving the company’s goals. This includes promoting values such as transparency, accountability, and continuous learning, and fostering a sense of trust, respect, and collaboration among employees.