
Image from reallearning.com
By Dilanaz Ercan (24-25)
We’ve all been there. You wake up Monday morning, and your first thought is either “I’m excited to tackle this week” or “How can I get through another day with this manager?” The difference often comes down to one crucial factor: leadership style.
Recent research reveals a stark reality about UK workplaces. According to Gallup’s 2024 State of the Global Workplace report, only 21% of employees globally feel engaged at work, while in the UK specifically, employee engagement sits at just 10% (Gallup, 2025). Even more concerning, 82% of UK employees don’t trust their manager to tell the truth (People Insight, 2025). These statistics paint a troubling picture, but they also highlight an enormous opportunity for organizations willing to invest in better leadership.
The Research Behind Leadership Impact
My recent study, conducted with 15 UK employees across various industries, explored how different leadership styles impact day-to-day work experiences. What emerged was a clear pattern: the way managers lead doesn’t just influence productivity—it fundamentally shapes employee well-being, creativity, and job satisfaction.
The research identified three primary leadership approaches that employees encounter: transformational leaders who inspire and develop their teams, democratic leaders who involve employees in decision-making, and transactional leaders who focus on clear targets and rewards. Each style creates dramatically different workplace experiences.
Transformational Leadership: The Clear Winner
Transformational leadership consistently produced the most positive outcomes. These managers don’t just assign tasks—they create meaning. They help employees understand how their work contributes to something bigger and support individual growth through what researchers call “individualized consideration” (Bass & Avolio, 1994).
One participant described their transformational manager: “She doesn’t just tell us what to do, she explains why it matters and how our work contributes to something bigger. When I’m stuck on a problem, she asks questions that help me think differently rather than just giving me the answer.” This aligns perfectly with Self-Determination Theory, which shows that when employees feel autonomous, competent, and connected to others, they experience higher levels of intrinsic motivation and well-being (Deci & Ryan, 2000). Transformational leaders naturally support these psychological needs.
The Democratic Advantage
Democratic leadership showed strong positive effects, particularly in building psychological safety. When employees feel their voices are heard and their expertise valued, they become more invested in outcomes. The Job Demands-Resources model explains why this works: democratic leadership acts as a crucial job resource, helping employees manage workplace pressures while feeling empowered rather than controlled (Bakker & Demerouti, 2007). However, employees noted that while democratic leadership created steady engagement, it sometimes lacked the inspirational spark of transformational approaches.
The Limits of Transactional Leadership
Transactional leadership usually generates good results in the short term. There are clear mechanisms, that mobilize employees towards certain goals. Goals and rewards are completely clear to workers. However, most respondents indicated that there was an increase in workplace stress. They also had much lower personal control. One participant commented on transactional leadership patterns as follows: “You are always asking for desired results and responses.” Sometimes the approach seems overly mechanistic, however. This system doesn’t allow for a lot of creative thinking either. Transactional leadership clarifies and applies discipline to the workplace. At the same time, it reduces motivation and creativity. This result is consistent with motivational research. Extrinsic control takes away motivation and creativity (Ryan & Deci, 2000). Transaction systems can boost short term results in the long term, commitment, and sustainable performance decreases. Interior drives are weakened by being controlled from the outside.
The Context Matters
One interesting result of the study is that effectiveness of leadership is not only a matter of style, but heavily influenced by context. Experiences in leadership are affected by organizational culture, external pressure, and by individual preference. Transactional leadership can introduce order and predictability which may be useful in stressful situations (e.g., emergency services or finance). In contrast, workers in creative areas such as design or technology will have the optimal working conditions when leaders provide autonomy, inspiration, and the opportunity for creativity. Lastly, the best leaders are never distinguished by just one leadership style. Instead, they learn how to exercise the translation of transactional clarity to inspirational transformation in every colleague event and need. Leadership is therefore not a static model to be studied, but an elastic process that is dynamic and contextual.
What This Means for Organizations
Organizational context is critical to leadership effectiveness. Individual preferences and outside pressures are all important. Organizational culture can have a powerful impact on leadership style effectiveness. Transactional leadership is mostly effective in crisis situations. Emergency services and finance deal with predictability Creative industries need an entirely different style of leadership. Design and technology workers must be working autonomously. They work well under inspirational and transformational leadership. Great leaders never use one technique. They adjust their style to meet the needs of a colleague. They transform clarity of transaction to clarity of transformation. Leadership is a changing and situational process. It cannot be studied as a static model. The best leaders are agile and reactive.
The Bottom Line
With managers accounting for 70% of the variance in team engagement (Primeast, 2025), leadership isn’t just a nice-to-have—it’s a business-critical capability. The cost of poor leadership extends far beyond individual dissatisfaction. Disengaged employees are less productive, less innovative, more likely to leave, and more prone to stress-related health issues.
But here’s the encouraging news: leadership can be learned and improved. The employees I interviewed didn’t want superhuman managers—they wanted leaders who showed genuine interest in their development, communicated clearly about expectations and changes, and treated them as whole people rather than just resources.
In an era where talent retention is crucial and employee well-being is finally being recognized as fundamental to sustainable performance, investing in leadership development isn’t optional—it’s essential.
References
Bakker, A.B. & Demerouti, E. (2007) ‘The Job Demands-Resources model: state of the art’, Journal of Managerial Psychology, 22(3), pp. 309-328.
Bass, B.M. & Avolio, B.J. (1994) Improving organizational effectiveness through transformational leadership. Thousand Oaks, CA: Sage Publications.
Deci, E.L. & Ryan, R.M. (2000) ‘The “what” and “why” of goal pursuits: Human needs and the self-determination of behavior’, Psychological Inquiry, 11(4), pp. 227-268.
Gallup (2025) State of the Global Workplace: 2025 Report. Available at: https://www.gallup.com/workplace/349484/state-of-the-global-workplace.aspx (Accessed: 29 August 2025).
People Insight (2025) Employee engagement statistics 2025. Available at: https://peopleinsight.co.uk/employee-engagement-statistics/ (Accessed: 29 August 2025).
Primeast (2025) 59 employee engagement statistics for 2025. Available at: https://primeast.com/insights/employee-engagement-statistics/ (Accessed: 29 August 2025).
Real Learning. (2022, November 15). What is your leadership style and how is it impacting performance? [Image]. Real Learning.
