Discuss the view that a democratic leadership style could cause some businesses to

underperform. [16]

In a business, there are many different types of how a team could be led, one of them is a
democratically led team or democratic leadership style. This style of Democratically led
leadership refers to an open-styled relationship where engagement and feedback from the
members involved are heavily encouraged, hence making it a two-way communication-based
leadership.

This particular type of leadership style is most commonly found in sectors where the opinions
and feedback of the workers are especially valued, namely the corporate, education, and
government sectors. However, this may be employed in other sectors when deemed
appropriate. Regardless of the effectiveness, this type of leadership may set in motion some
drawbacks for the business. One of the most common is a decrease in the performance of the
business, or in other words, underperformance. Underperformance is when an employee or a
business is performing their duties below the standard level that has been set or expected
which, in turn, reduces the overall output and revenue of that business.

A disadvantage that can be regarded as one of the key contributors to a business’s

underperformance is the amount of time needed to set forth a decision since the opinions and
the agreement of the employee must also be contemplated. Added to that, a form of
consultation may be given to the employees, this is done so as to give consideration to the
employees that may not agree with the decision, hence increasing the time needed for a
decision to be made. For example, an event organizer is required to arrange a venue for a
dangerous event that is to be set in a few months. However, because of the frequent back and
forths of decisions and disagreements among the employees, the business only had a few
weeks to do the necessary preparations, hastily. As a result of this hasty preparation, one of the
actors performing the stunts was hurt badly. This tarnished the business’s reputation, hence
causing an overall drop in revenue of the business, forcing it to file for bankruptcy a year later.
The example above conveys how a delay in decision-making could cause a business to
underperform, which in this case is the failure to meet the standards of safety and security that
the business had to meet. As a result of this incident, the business will, in due course, lose
revenue.

Another drawback that may present itself to the business, is the lack of wanting to participate in
the making of decisions. This may be caused by the employee finding it troublesome, they may
feel that they are doing more work than needed, and just an overall lack of motivation to partake
in the making of decisions. This may bring about less motivation from the employees, hence
causing more burnout and faltering productivity. Furthermore, employee decisions may cause
more harm than good, this is because the employees could make biased decisions, hence
resulting in unanimous votes to decline crucial decisions just because it may be a burden to
them. Added to that, the higher-ups cannot intervene with the result of the decision since a
decision can only be made with the agreement of every employee or the mass majority. This
could result in decisions, no matter how beneficial, being held back. For example, a business
currently has a total of 240 workers in its workforce, 50% of them from a trade union. The
business decided that it would be best to change the form of financial compensation from a form
of salary to a time-based wage. This resulted in a disagreement and negative feedback,
reasoning it as a form of restricting employee “freedom”. However, 50% were against the
change, this caused 48%(2% neutral) of the workers to feel cheated since the majority won
because of them having more numbers on their side. This may result in the rest of the
employees not feeling motivated inevitably causing them to be less productive.