Participative leadership

What is a participative leadership style?

Participatory leadership is a management model that relies on close cooperation between executives and employees. Employees actively participate not only in the company's decision-making processes but also in planning and oversight tasks. Beyond making decisions, they also share responsibility for achieving set goals.

The participatory style of management is based on principles of equality, fairness, mutual respect, and understanding. It fosters personal development and the mental well-being of employees, as they are not seen merely as order-takers but as equal partners.

American organizational and social psychologist, Rensis Likert, noted that the most effective managers use this management model to:

• Care for their employees;
• Avoid punishments, threats, and other forms of intimidation;
• Refrain from using rewards to gain employee loyalty;
• Involve employees in decision-making, which strengthens cooperation, integrates the team, and boosts motivation.

Autocratic vs. participative leadership

Participatory leadership views the organization as a whole and actively involves employees at all levels in all management areas – from finance (e.g., generating ideas to save resources) to recruitment (e.g., sourcing). Decisions may be slower to make, but are usually more thoughtful and accepted by most of the team.

Conversely, autocratic leadership is a management model where decisions are made by one person – the leader – without team consultation. This style works well in environments where strong control is needed:

• In crisis;
• For teams with lower-skilled workers;
• In simpler projects with clear objectives and short timelines;
• In companies with long-standing hierarchical structures;
• During the early stages of a company’s development, when quick decisions and centralization of power can help launch a product or service.

The choice of management style should be tailored to the specifics of the organization, its goals, and its corporate culture.

Benefits of participatory leadership

Key advantages of participatory leadership include:

• Increased employee engagement: Employees involved in decision-making feel more valued, motivated, and responsible for their work outcomes.
• Improved internal communication: The participatory style promotes open communication and smooth information exchange, building a strong team.
• Higher job satisfaction: Being able to express opinions and having greater responsibility increases employee satisfaction.
• Lower staff turnover: Higher satisfaction and the opportunity to voice opinions reduce the likelihood of employees leaving.
• Increased innovation: Leaders can better utilize the diverse skills and experiences of team members, who are more likely to display creativity and innovative problem-solving.
• Development of soft skills in leaders: This style of management helps leaders develop skills such as listening, empathy, and conflict management.

Moreover, when decisions are discussed with a broader group, they are usually more thoughtful and effective. Diversity of perspectives also speeds up problem-solving.

Challenges of participatory leadership

Despite its benefits, participatory leadership also faces various challenges that can complicate effective management and implementation of this style in practice. These include:

• Diffusion of responsibility: The more responsibilities managers place on employees, the quicker the clear division of duties fades, leading to conflicts and organizational chaos.
• Lack of accountability: Employees might lack the necessary knowledge and skills to make informed decisions. When mistakes occur, it can be difficult to pinpoint who is truly responsible.
• Decision-making delays and risk of excessive compromise: The need for consultation and resulting disputes are time-consuming and costly, impacting organizational efficiency. Additionally, there is a risk that final decisions may be overly compromised.
• Lack of consensus: The more people involved in the decision-making process, the harder it is to achieve unanimity.
• Information overload: Too much information can demotivate employees from participating in decision-making.
• Need for skill enhancement in leaders: Not all leaders are naturally suited to this leadership model. If retained, they must develop their soft skills, potentially incurring additional training costs.
• Increased operational costs: Implementing participatory leadership involves purchasing project management tools, conducting employee training, and redesigning career paths.
• Employee resistance: Changing the work style can be challenging for those accustomed to other methods, leading to potential sabotage of the transition process.

How employees can participate in management

Here are some ways employees can be involved in managing an organization:

• If the company provides employees with access to key information about its operations – financial results, strategic goals, development plans, etc. – it becomes easier for them to understand the business context and the relevance of their decisions. This also makes their ideas and suggestions more aligned with the organization’s current needs.
• Open communication between employees and management facilitates the exchange of ideas, opinions, and suggestions.
• Feedback exchanges, such as 1:1 meetings or group workshops, are also crucial.
• Decision-making teams / committees can be formed within the company, where employees from different departments collectively analyze problems and seek solutions. Internal innovation programs can also be initiated to gather employee ideas for improving operations.
• Employees can express their opinions on various aspects of the company’s operations through surveys or votes, the results of which are considered in further decision-making processes.
• The company can organize career paths so that each promotion involves greater responsibility and authority, allowing the most competent employees to have a significant real impact on the organization’s actions.
• The company might also encourage participation through employee stock ownership plans, offering shares in its profits based on performance or other indicators (e.g., length of service).

Introducing participatory leadership in a company is a process that requires thoughtful planning, commitment from both management and employees, and the adoption of a specific organizational culture. It must be preceded by leader and employee education and the strengthening of internal communication. When successfully implemented, it brings numerous benefits and enhances the company’s operational efficiency.