How Management Styles Could Create Or Contribute To Crisis Situations

The management styles of corporate executives can determine how they respond to a crisis. But there are some approaches to managing organizations and people that can help create or contribute to crises at companies. The list of crisis situations includes lawsuits, negative publicity, low employee morale, protests, and resignations.

Leadership Styles

Autocratic

Autocratic leaders make “decisions without input, and this can lead to a crisis due to lack of diverse perspectives and resistance from team members who feel disregarded,” Christine Haas, CEO of Christine Haas Media, said via email.

“The Open AI board’s firing of Sam Altman was clearly an example of autocratic leadership,” she pointed out. The firing “led to nearly all of the Open AI employees threatening to quit if he wasn’t reinstated. And it also builds more fear among the naysayers of AI in general,” Haas observed.

Micromanaging

Micromanaging managers stifle creativity and innovation and can make employees feel like they are not trusted to do their jobs. This can lead to a decrease in productivity,” Cassandra LeClair, a clinical professor of communications at the Mays Business School at Texas A&M University, said via email.

Toxic

“Angry managers can create a hostile work environment, which can lead to decreased productivity, increased turnover, and lower morale,” LeClair said.

Delegation

This leadership style “could lead to a quandary if too many employees go into business for themselves (meaning they put their needs over the vision of the CEO),” Ryan McCormick, co-founder and media relations specialist at Goldman McCormick Public Relations, said via email.

“While a minimal intrusive form of leadership can reap benefits, not being fully attentive to how all the players are moving on the board 24-7 is the recipe for a crisis,” he predicted.

Laissez-Faire

‘Laissez-faire leaders provide minimal guidance, allowing team members to make their own decisions, Jessica Childress, managing attorney of the Childress Firm, an employment law firm in Washington, DC, said in an email message.

“While autonomy is beneficial, an absence of clear direction may result in confusion and indecision during a crisis…employees may feel neglected and unsupported. This can lead to a lack of direction, unclear expectations, and a toxic culture characterized by uncertainty, frustration, and a lack of accountability,” she advised.

Democratic

Democratic leadership encourages leaders to involve employees in the decision-making process, according to McCormick at Goldman McCormick Public Relations.

This type of leadership “could create a crisis if the majority of workers think that a crucial decision for the company is dramatically different from the vision of the CEO. While this leadership does value the input of others, ultimately, the CEO is the decision maker for the company,” he said.

Managing Crisis Situations

Elon Musk continues to be a textbook example of the different crisis situations that a top corporate executive can create.

The best practice for managing crisis situations that different management styles could create is to rely as little as possible on top executives to manage the crisis. This approach underscores the need for crisis management plans implemented by crisis management teams who test the plans regularly.

The exercises can help ensure that the plans and teams will work well when needed and provide opportunities to update the plans and members of the team when necessary.

The more the plans and teams are tested, the more likely it is that the team will develop the equivalent of muscle memory and be able to respond automatically and reflexively when a crisis strikes with minimum involvement—or interference—from others.