Fit for the 21st century? Unpacking the promise of new leadership styles

New leader collaborating with team members in a modern work environment, illustrating the concept of 21st-century leadership.

By Nils Reisen on 07.02.2024 | 9 minutes reading time

The world of work is in a state of flux. Fuelled by the pandemic, technological progress and generational shifts like the retirement of baby boomers, employees are expressing a growing desire for remote work, increased autonomy, and a clear sense of purpose.

As a result, the traditional top-down, command-and-control approach is slowly fading into oblivion, replaced by more dynamic, collaborative, and people-centric leadership approaches, sometimes referred to as “New Leadership”.

So, what is New Leadership? Is it really new? And will it live up to the hype? Read on to find out.

What is New Leadership?

The term New Leadership is used to describe a broader approach to leadership that goes beyond traditional hierarchical models. It is not a single, unified theory or set of practices, but rather an umbrella term for a range of leadership approaches that share some common characteristics:

Purpose: A central element of New Leadership is creating a sense of purpose and meaning for employees. It’s about helping people to understand how their work contributes to the overall goals of the organisation and the larger world.
Ownership: New Leadership bids farewell to top-down command-and-control management, opting instead to empower employees to take ownership of their work and collaborate effectively with others.
Relationships: Building strong relationships with people at all levels of the organisation is a central element of New Leadership. It aims to foster a culture of trust, respect, and psychological safety, empowering individuals to feel valued and contribute their best.
Adaptability: New Leadership operates under the premise that the world undergoes constant change, requiring organisations to swiftly adapt and learn. This requires leaders to be open to new ideas and to be willing to experiment with new approaches.

Here are some examples of how New Leadership is being applied in different organisations:

Spotify (Sweden): Known for its agile and autonomous squads, Spotify promotes a culture of innovation and collaboration. The company embraces a decentralised organisational structure, allowing teams to work independently and efficiently. Check out the Spotify Engineering Culture video for a comprehensive explanation.
Zalando (Germany): Zalando, an e-commerce giant, has embraced a culture of radical agility. They drive employee engagement and attract top talent by emphasising autonomy, mastery and purpose, adapt their organisational structure to make real end-to-end ownership possible and foster high levels of trust (Cadieux & Lobis, 2018; Pink, 2009).
Netflix (USA): Netflix is recognised for its unique culture, characterised by freedom and responsibility. The company focuses on hiring and retaining high-performing individuals and encourages a culture of continuous improvement (see Netflix Culture for details).

These are just a few examples of how modern leadership practices are being applied in different organisations. As the world continues to change, we can expect to see even more innovative approaches to leadership emerge in the near future.

How truly new is New Leadership?

Reading the description above might evoke a “Wait, that's just common sense” response – and indeed, it is. However, it seems this common sense was lost amid the past decades’ heightened focus on optimising human resources, a byproduct of industrialisation and the growth of large corporations.

Just as the food industry sees a rising demand for local products from smaller businesses post-industrialisation, efforts are made to scale down the organisation of work to human dimensions. Examples include the rise of agile work methods and the shift from hierarchical structures to value stream-driven processes.

New Leadership goes beyond mere adaptation to these changes or implementing new techniques. It involves a fundamental reconsideration of leadership, acknowledging that today's organisational challenges differ significantly from those of the past.The pace of change is accelerating, demanding greater agility and adaptability from both companies and employees than ever before. This requires leaders who can think strategically, inspire, and motivate their teams to innovate and take risks. While it might sound cliché, I believe there's a substantial amount of truth in it.

In that sense, New Leadership represents an evolution of leadership styles better suited to the challenges we face today. It's not about abandoning everything that has worked in the past; rather, it involves taking the best practices from the past and adapting them to the present — always with an eye on the future.

Will New Leadership improve the world of work?

Will the current shift in leadership behaviour be remembered as a defining step for the world of work at the beginning of the 21st century?

While I can't predict the future, the current scientific evidence offers some insights. Let's have a look at transformational leadership as an example for New Leadership. This established model has been the subject of extensive research and shares many characteristics with newer leadership models such as authentic, ethical or servant leadership (Deng et al., 2023), which all form part of the umbrella term New Leadership.

Transformational leadership is a type of leadership that focuses on inspiring and motivating followers to achieve their full potential. It involves four key components (Wikipedia):

Idealised Influence (II): the leader serves as a role model and is admired for embodying desired qualities.
Inspirational Motivation (IM): the leader inspires and motivates through a clear vision.
Individualised Consideration (IC): the leader demonstrates genuine concern for followers’ needs and fosters trust.
Intellectual Stimulation (IS): the leader challenges followers to be innovative and creative, encouraging them to question the status quo.

This leadership style combines charisma, vision, personal attention, and a commitment to challenging followers for enhanced performance and creativity. A very recent meta-analysis by Deng and colleagues (2023) showed that transformational leadership has a proven positive impact:

It has a positive effect on aspects such as performance, organisational citizenship behaviours, extra effort, engagement, trust in the manager, leader-member exchange, psychological empowerment, and identification with the leader.
It enhances follower motivation, leading to positive leadership outcomes.
Transformational leaders contribute to higher well-being, creativity, job satisfaction, and commitment among followers.

The same study also found that other leadership styles have proven negative effects:

Abusive supervision is associated with increased stress and burnout among followers.
Authoritarian leadership negatively impacts innovation.
Laissez-faire leadership is linked to lower leader effectiveness.

This shows that we should not only consider the positive outcomes of good leadership, but also the detrimental effects of certain leadership styles. Thus, an effective leadership development strategy focuses on promoting and cultivating positive leadership behaviours, and also involves identifying and discouraging negative ones.

That said, more traditional leadership styles also have their merits, for example in highly regulated, standardised industries where reliability and safety are of utmost importance (e.g. airlines) or in times of crisis (Campbell, 2023).

However, in many cases transformative leadership is an excellent option. What can you do to become a transformative leader or how can you assist others in this journey?

Seven steps to become a “new leader”

Get up to speed on leadership skills: learn about different leadership styles, important skills and behaviours, for example by reading relevant literature or enrolling in courses. It’s always good to know what you are doing.
Identify your own leadership style: reflect on your values, strengths, and weaknesses. Understand your leadership style and its impact on others. Regular feedback from the team (e.g. via a 360-degree survey, interviews) is a great way to achieve this.
Inspire a vision (Inspirational Motivation): create a clear and compelling future vision – ideally together with the team. Integrate this vision into your daily work and periodically review it.
Lead by example (Idealised Influence): demonstrate the values and behaviours you expect. Build trust by being consistent and authentic in your actions. Foster an environment where individuals feel empowered to contribute.
Consider everyone individually (Individualised Consideration): show genuine concern for your team members’ needs and aspirations. Establish strong relationships with your team members and provide personalised support and development opportunities.
Encourage and challenge (Intellectual Stimulation): promote creativity and innovation within your team, for instance by using mixed-skills teams, creating creative workshop settings, or even encouraging job rotations. Challenge the status quo and cultivate a culture of continuous improvement, such as conducting regular retrospectives on team collaboration.
Regularly assess your progress and engage in continuous learning: Establish a continuous cycle of measuring, learning, and improving by consistently engaging in exchange and reflection with the team.

Curious to learn more about your own leadership skills?

Use our leadership questionnaire to:

Conduct a quick and simple survey
Understand how others assess your leadership skills
Kick-start an ongoing cycle of measurement, learning, and improvement.

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Crucially, New Leadership emphasises teamwork, involving collaboration with both subordinates and peer leaders. The essential skill of effective collaboration is equally applicable to leadership teams, an aspect that is often underestimated.

Conclusion

Each era comes with its own circumstances, values, and expectations from both clients and employees. Unsurprisingly, these have undergone significant changes in recent decades. While addressing these changes goes beyond adapting leadership styles alone, the aspects and behaviours encompassed in the concept of New Leadership have proven better suited to 21st-century challenges.

The good news is there a few relatively simple steps you can take to get started. However, being a good leader is more challenging than memorising these points; it requires practice and constant feedback. Ready to begin?