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8 Effective Leadership Behaviours to Improve Business Performance

Learn how to identify and develop effective leadership behaviours to improve your business productivity, performance and profitability in this quick guide.

8 Effective Leadership Behaviours to Improve Business Performance

Published on:

9 Nov 2023

More than 77% of businesses state they have leadership gaps. This should come as no surprise considering more than 10,000 baby boomers are retiring every day and 69% of millennials believe there is a lack of leadership development opportunities in their workplace.

Despite 88% of employers stating it’s crucial to develop leaders at all levels, many businesses seem to struggle in actually executing this development, resulting in lacklustre management lacking the leadership behaviours necessary to drive high performing teams.

Businesses need to focus more on leadership behaviours

Leadership behaviours are fundamental to success both for starting a company and growing one. As the old saying goes, employees quit their boss, not their job.

The reality is low employee retention is just one of the numerous issues poor leadership behaviours cause. Gallup research shows that managers are the biggest factor affecting employee engagement, accounting for around 70% of the variance in employee engagement, both negatively and positively. When we consider employee engagement is the driving force behind business productivity and performance, this statistic is of critical importance.

Poor leadership costs businesses. The same research shows companies fail to pick managers with the right talent for the job a staggering 82% of the time.

Much of this comes down to the reasons employees are promoted into positions of leadership currently. The traditional approach is to look at length of service or who has the most developed technical skills in their current role.

But length of service and business skills often don’t translate into the makings of a great manager. For example, a highly skilled web developer – though undoubtedly a key player within an organisation – doesn’t automatically possess the leadership behaviours necessary to drive business performance.

Research suggests around one in ten people possess the leadership behaviours necessary to achieve excellence. These 10% can naturally engage both customers and employees, creating a culture of high productivity and performance within their team. The same research reveals that a further two in ten people have some of the leadership behaviours necessary and have the potential to achieve excellence with the right leadership development strategy in place.

Nonetheless, we know from the research above and the statistics in the introduction, that many businesses seem to struggle to identify these potential leaders. Experience and skills are important, but more important than either of these are leadership behaviours.

What are leadership behaviours?

Put simply, leadership behaviours are the natural characteristics and traits that make some people more effective as leaders than others.

It’s important to note, that while for many these leadership behaviours are innate, there is no reason leadership behaviours can’t be developed through various learning and development strategies.

Individuals utilise these leadership behaviours to manage themselves and those around them to increase productivity and performance, for the benefit of the organisation.

Why are effective leadership behaviours important?

Effective leadership comes with many benefits for organisations, including:

  1. Improved productivity

  2. Improved performance and profitability

  3. Stronger teams

  4. Better collaboration

  5. Increased employee retention

  6. Increased innovation

  7. Stronger company culture

  8. Faster business growth

All of these benefits are interlinked. Effective leaders lead more effective teams or departments, who collaborate better and are more engaged and therefore more productive. This leads to an overall improvement of the team’s performance and profitability. The business is able to use these profits to grow faster than planned.

But the benefits of an effective team don’t end there. Employees who love the people they work with thanks to improved collaboration are far more likely to stay with a company longer, meaning companies can reduce recruitment costs and lower employee churn. Similarly, the improved working environment and increased employee engagement and productivity can lead to more innovative and creative approaches, also helping the business grow faster.

One of the easiest ways to see the benefits of a great leader is by example. Think of some great business leaders such as Bill Gates, Warren Buffett and Reed Hastings. If you think about the various behaviours these leadership examples possess, you’ll start to get an idea of the effective leadership behaviours that drive excellence.

8 effective leadership behaviours for success

There are no end of potential leadership behaviours that align with various leadership styles, however the most effective leadership behaviours to drive excellence are:

  1. Motivate

  2. Be assertive

  3. Hold yourself accountable

  4. Be transparent

  5. Be approachable

  6. Be objective

  7. Be attentive

  8. Lead by example

We’ll look at each.

1. Good Leaders Understand Everyone has Unique Motivations

One of the most important leadership behaviours is the ability to motivate those around you. Many think that motivation comes down to simple monetary rewards or the ability to be optimistic in spite of challenging situations. While these sometimes help, the reality is individuals have a variety of intrinsic motivations that make them behave the way they do.

For example, while one employee may be motivated by reaching goals and targets, another is more interested in building meaningful relationships and receiving regular verbal feedback on their performance.

Great leaders acknowledge this aspect of human nature and utilise their knowledge of employees to create methods to best motivate each individual employee. A helpful tool in recognising and understanding different motivations are workplace personality tests.

2. Effective leaders are assertive, but not authoritative

Another effective leadership behaviour is assertiveness. Leaders need to be able to make decisions and have confidence in those decisions, especially when things are challenging.

Assertive doesn’t mean ignoring the opinions of those around you and demanding everyone follow your lead. Great leaders are able to take on board a range of differing perspectives and make swift decisions with confidence. In turn, colleagues should have confidence in your decisions and your ability to make the right one.

3. Create a culture of ownership by holding yourself and others accountable

Many people have had a manager who passes the buck and it’s not a pleasant experience to say the least.

This is why holding yourself accountable is an effective leadership behaviour. When things go wrong within your team, you shouldn’t pass the blame along to another colleague. Leaders who hold themselves accountable earn the trust and respect of their colleagues, building stronger and more meaningful relationships in the workplace.

Modeling this behaviour to employees creates a better working environment; one where it’s okay to make mistakes and take risks, even if they don’t always pan out. This can encourage employees to take ownership over their own work and increase engagement.

4. Be honest and transparent at all times

Research shows that 82% of employees don’t trust managers to tell the truth. This poor communication and lack of trust impacts engagement significantly.

Transparency and honesty are vital leadership behaviours. The ability to communicate clearly and honestly, in both good and bad situations, builds trust between you and colleagues.

They can also help create a better working environment, one that is fair and open. Employees are more likely to come to you with problems early on, as opposed to leaving them to build and become more of a challenge later.

5. Be approachable to encourage communication and collaboration

Though honesty and transparency undoubtedly help, another good leadership behaviour is to be approachable. For many, this seems to come as a natural social skill. For others, despite having many other great leadership behaviours, being approachable is something they need to actively work on.

Actively listen to employees, be attentive and ask open-ended questions. The leadership features of Revenue Intelligence can help here. Communicate regularly, not just about work matters, but about other things going on in their lives. All of these can help employees feel like they can talk to you about anything and know that you’ll take onboard what they say when you do.

6. Be objective and avoid office politics

Objectivity or impartiality is an important leadership behaviour. We’ve all been guilty of having a colleague we favour, as well as some we definitely don’t. Effective leaders are able to examine and understand this bias and make impartial decisions and provide objective feedback regardless of personal preference.

Objective feedback should be encouraging, not disparaging, with a focus on finding a solution as opposed to critiquing. Similarly, decisions shouldn’t be made based on who you like the most. Good leaders are able to identify which employee is the best suited for each task or activity based on their skills and previous performance.

7. Be attentive to employees’ needs and emotions

Effective leaders are attentive. Not only to ongoing tasks, activities and projects, but to the individual needs and emotions of the employees on their team.

For example, some employees may work best with minimal supervision, while others may work best in stretch roles with many new challenges to tackle. Leaders should pay attention and consider the unique needs of every employee in their team or department for the best performance.

When leaders are attentive to employee needs and behaviours, they can spot when something isn’t quite right. People have off days for a variety of reasons, often entirely unrelated to work. Attentive leaders can identify less productive days and communicate with employees to find out what they can do to help resolve the issue. This in turn can improve job satisfaction for employees, knowing they have a leader they can depend on and who cares about their well-being.

8. Lead by example and model desired behaviours

An individual that possesses all the above leadership behaviours and displays them regularly at work is an ideal role model to other employees. Effective leaders hold themselves and employees to a high standard and lead by example.

For instance, you wouldn’t turn up late to work everyday, but expect your employees to be on time. A good leader models the behaviour desired from employees so it is clear what the expectations are.

How to improve leadership behaviours

Not everyone innately possesses effective leadership behaviours. Even for those that do, displaying those behaviours consistently is still a challenge. Fortunately, there are many leadership behaviour frameworks available to help further develop these behaviours.

A popular choice is Kouzes and Posner’s five practices of exemplary leadership model. They state that leaders who follow five core practices make the most effective leaders.

These are:

  1. Model the way

  2. Inspire a shared vision

  3. Challenge the process

  4. Enable others to act

  5. Encourage the heart

The first practice, model the way, refers to leaders creating and following the standards of excellence they wish others to follow. These principles set clear guidelines for employees to follow.

Leaders then need to inspire employees to work towards a shared vision and goal. They motivate and inspire employees by aligning everyone to work towards this shared vision.

Effective leaders must challenge the status quo of things and innovate to continuously improve the business. They are unafraid to take risks and experiment to identify new opportunities.

Of course, leaders must encourage and enable other employees to act, not just themselves. Effective leaders foster collaborative and energetic teams with an inclusive environment where every individual employee feels empowered to do their best.

Finally, effective leaders encourage the heart by recognising and rewarding excellence. They recognise each individual contribution made and celebrate achievements and accomplishments.

Research by Kouzes and Posner shows leaders who demonstrate these practices consistently are more effective and have higher performing teams.

Another helpful leadership behaviour model was created by Blanchard and Hersey. Their four part situational leadership model is practical and can be applied immediately to situations. They state no leadership style is better than another and that effective leaders adapt their leadership style to individuals.

They suggest four different leadership styles that can be applied for any situation as it arises:

  1. Telling style: a high supervision style for employees new to tasks or the role.

  2. Participating style: a moderate supervision style where leaders are actively involved with tasks to help build employee confidence.

  3. Selling style: a lower supervision style where leaders intervene when necessary due to low motivation.

  4. Delegating style: a minimal supervision style where employees can handle tasks well and understand their role.

Many managers find this leadership behaviour model useful in figuring out the best way to help improve employee engagement.

Develop your leadership behaviours and create high performance teams

Without effective leadership behaviours, no matter the hard technical skills or length of service, you’ll struggle to inspire and motivate employees. While some individuals naturally possess these leadership behaviours, others must actively work on developing them and practicing them consistently. Our business improvement programme works with business owners and leaders to identify and improve behaviours, one behaviour at a time, creating a more productive and profitable business.

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