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The Three Small Business Management Styles

Small business administrationApart from the gruelling task of managing employees by viewing them as individuals, entrepreneurs must adopt the most effective small business management styles. Appropriate management styles contribute to an organization’s growth and development. The right style promises to solve the problems in the organization, enhance employee satisfaction, and increase productivity.

But which is that management style that will ensure that these returns are guaranteed?

There are three primary management styles you have to choose from. Let’s talk about the pros and cons of each.

First, there is autocratic management. This is a type of management style where managers will decide and enforce their decisions on the workforce without involving them. There is no employee input in the decision-making process because the managers possess exclusive authority. Therefore, no one is expected to challenge the decisions of this type of management. This type of management suits those employees that require close supervision as well as those situations that the managers have to take quick decisions. It can only work when applied to employees who are without requisite expertise. However, it is an approach that is disliked by the most talented and creative employees. It is a method that promises to demotivate employees as their voice becomes limited.

 Paternalistic management is a second common management style. Most successful larger organizations practice this type of management. The manager considers the needs of employees when making decisions. Although the management gives directions to the workforce by making information flow from the top, it pays attention to employee feedback. This is an effective method of management that fosters employee morale and motivation. It may be applied by management where it wishes to regain employee loyalty. However, the major disadvantage of this management approach is that it does not facilitate employee autonomy. It forces the employees to always look up to the manager to make the final decision.

Types of Mgmt Styles

 Finally, democratic management is another common management style. This is an approach to management that is recommended by many business scholars for today’s business environment. This management style entails involving employees in the decision-making process. There is a two-way communication flow between the management and the employees, thus improving satisfaction and business performance. The individual employees feel that their opinions count in management of the business and are motivated to live up to the business expectations. Employee engagement and empowerment is practiced in this type of management. The business stands to gain from diverse thoughts, which can be a source of innovation, useful ideas, and creative suggestions.

The major advantages of this management approach are that it fosters collaboration, operational excellence, autonomy, and harmony in an organization. However, it is an approach that is likely to slow down decision-making. Some decisions require to be implemented fast to take advantage of an opportunity, but the management cannot bypass the employees. Therefore, sometimes the management may find it difficult to implement decisions that may have benefitted the organization. Additionally, employees may make mistakes and errors if they do not have the appropriate experience and skills to make quality decisions.

 The three major types of management have their pros and cons, so there is no one-size-fits-all recommendation. As a beginning entrepreneur, it is important to adopt a balanced and integrated approach to management.

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