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What is a laissez-faire leadership style?

At a glance

  • Laissez-faire leadership is characterized by a hands-off approach to business management that allows employees a high level of autonomy.
  • Laissez-faire leaders can produce a more satisfying work environment, foster a sense of creativity and increase productivity.
  • Understanding the nuances of leadership is a powerful skill. Develop your business acumen with a business degree from University of Phoenix.

Laissez-faire leadership compared to other leadership styles

Strong leadership is a crucial part of any business and its chances for success. That said, every business is different. A CEO who successfully brings one company to the top of its industry may flounder when placed at the helm of another organization.  

Identifying the leadership style appropriate to an organization can help a leader forge a path toward success. This style will define the ways that a leader guides, inspires and oversees their employees. Does the organization require a micro-manager who gets involved in every detail? Or should a manager be hands-off to the point of being absent? Or maybe there’s something in between?

According to a 1939 study conducted by psychologist Kurt Lewin, there are three main types of leadership styles:

  1. Autocratic or authoritarian leadership: This leadership style is characterized by intensive top-down control. The leader decides with little or no input from their subordinates and leaves little or no room for improvisation on the part of their subordinates.
  2. Democratic or participative leadership: This type of leadership lets everybody have a say. Of course, there will generally still be a leader who has the final word, but the sense of participation can help subordinates approach their work with more energy and creativity. According to Lewin’s study, this style of leadership produces less work than its autocratic counterpart, but the quality of that work improves.
  3. Laissez-faire leadership or delegation leadership: Derived from the French phrase, which means, “Let people do as they choose,” laissez-faire leadership is the most hands-off of the three main leadership styles. A laissez-faire leader will generally be responsible for hiring talented, independent employees who are trusted with significant autonomy and freedom.

A laissez-faire leadership style has the potential to empower creative employees … or leave them feeling directionless. Understanding the characteristics, strengths and weaknesses of laissez-faire leadership can help managers understand if it is right for their organization.

Characteristics of the laissez-faire leadership style

Laissez-faire leadership is all about delegation. Here are some characteristics of this hands-off leadership style.

Minimal guidance from leaders

With this kind of delegative leadership, it’s not uncommon for subordinates to make many of their decisions independently. Leadership may lay out basic expectations, but they are not involved in many of the decisions that produce their expected results. So long as employees do not do anything to negatively affect the company, they are generally given guidance and free rein to make decisions and come up with new ideas.

High expectations of employees

It isn’t all about freedom, however. Laissez-faire leaders expect that employees can handle problems and challenges as they arise. Accordingly, employees often have substantial resources at their disposal. They can make decisions quickly and utilize those resources without asking for permission. Not surprisingly, there is a lot of trust in businesses organized around a laissez-faire principle.

Strong team-building skills

Due to the large amount of responsibility delegated to their subordinates, laissez-faire leaders have to be very careful when building their team. Successful delegation leadership requires strong team-building instincts and the ability to see their employees’ particular strengths and weaknesses. This allows leaders to construct the team in a way that ultimately achieves the organization’s mission.

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Advantages of the laissez-faire leadership style

Employees and leaders working within a laissez-faire organization enjoy a number of advantages in their work. These include:

A more satisfying work experience

When employees are allowed the freedom to work toward set business goals in the way that they choose, it can help them feel more energized and productive. Employees often know their own strengths, and laissez-faire leadership plays to those strengths.

Creativity and independence

Within a large organization, there are thousands of decisions that have to be made every day. Allowing employees to make many of those decisions is not just about organizational efficiency, however. It gives employees the opportunity to come up with new ideas and implement them.

This can be subtle (such as the particular arrangement of a graphic design) or obvious, but when these decisions are made by the individual employee without being submitted for leadership approval, it can encourage spontaneity and invention.

Efficient resource allocation

By delegating tasks that don’t require their particular attention, laissez-faire leaders can focus their energy on the things that do. This might mean recruiting new clients, making executive decisions or strategizing how to grow the organization.

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Disadvantages of the laissez-faire leadership style

As an employee, it may sound nice to be given more freedom in your work. As a leader, it may sound nice to delegate work to focus on other things.

Unfortunately, a laissez-faire approach is not always what it’s cracked up to be. When misapplied or applied to the wrong organization, it can undercut business goals in the following ways:

A loss of confidence

A hands-off leader can very easily be seen as a neglectful leader. Some decisions do require a strong executive decision-maker, like when there is an emergency or a new opportunity. Laissez-faire leadership can suggest that no one is steering the ship, and that can sink team morale.

Laissez-faire-managed employees can also feel defeated when they are delegated responsibilities for which they are ill-equipped. This can make them feel set up to fail and undercut their confidence.

Inefficient processes

While delegative leadership can increase efficiency, it can also have the opposite effect. When decisions that require a strong, singular executive voice are broken apart and delegated to a number of employees, it can be difficult to work efficiently. That inefficiency can be exacerbated during periods of crisis or turnover.

Team conflict

Laissez-faire leadership requires strong team-building skills, but even great leaders cannot anticipate every detail about how a team will work together. By giving employees more responsibility, leaders can inadvertently increase the possibility of one employee’s activities conflicting with another’s.

For example, if two employees come up with totally different ideas for a marketing campaign, they will likely need an executive voice to decide which direction to take. A completely hands-off leader may leave these two to sort it out between themselves, though, and that can become both negative and unproductive.  

Examples of laissez-faire leaders

There are numerous examples of successful laissez-faire leaders, particularly in the world of business administration.

Andrew Mellon

At the turn of the last century, a number of businesspeople made their fortune with novel approaches to production and management. One of the classic examples of a 20th-century businessperson is Andrew Mellon (1855-1937), a banker-turned-industrialist who became one of the wealthiest people in the United States.

Aspects of laissez-faire leadership can be found in many aspects of Mellon’s business philosophy. Instead of managing every detail of his business interests, he hired managers he could trust. Mellon gave these managers a large amount of autonomy to make the decisions they thought best.

This leadership style allowed Mellon to focus on the big picture: expanding his interests well beyond banking and into production, politics and art collecting.

Warren Buffett

Serving as the chairperson and chief executive of Berkshire Hathaway, Warren Buffett is the perfect example of how the laissez-faire leadership style can be applied to the modern business landscape.

Dealing largely with investments, Berkshire Hathaway’s success depends on finding opportunities before its competitors. To this end, Buffett makes a point of promoting employees who can work autonomously and jump on opportunities when they arise.

This approach to hiring and management contributes to Berkshire Hathaway’s dominance as a multinational holding company and Buffett’s personal wealth, which exceeds $110 billion.

What is the most effective leadership style?

Whether the laissez-faire leadership style is right for a particular organization will depend on several factors, including:

  • The size of the organization
  • The complexity of the work
  • The skillset of the employees

There are also some personal characteristics that will make a person more successful with this type of leadership style, such as:

  • An ability to trust and delegate to subordinates
  • A sense of each employee’s individual strengths and weaknesses
  • Thoughtfulness around each employee’s experience of their role
  • An understanding of when to step in and make an executive decision

Figuring out the leadership style that is best suited for your organization can take time. Sometimes, mixing and matching aspects of different leadership styles can be the solution, too. After all, innovation, whether in leadership strategy or day-to-day work, is often the key to success.

Equip yourself with the essential skills to thrive in today’s business landscape. Learn more about business degrees at University of Phoenix!