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Leadership styles are methods that adopted in organizations to provide guidance to their employees in performing the tasks. There are various kinds of leadership styles, such as autocratic leadership, laissez-faire leadership, democratic leadership and others. In autocratic leadership, the power is centralized in the hands of the leader and there is no consultation with the team or employees. In democratic leadership, there is a participation of team in taking decision for the organization. Lastly, in laissez-faire, there is least involvement of the leader in the working of the employees and the employees are independent in taking decisions regarding mode of function.

In the Not-For Profit sector, organizations working for community sector should consider their employees competency and the community where they provide service. Australia is a country of diverse culture and the needs of communities differ from one another. The organization leaders must take reasonable precautions to deal with governance issues while providing service to the community to ensure maximum benefit.

Keywords: Leadership style, Not-For Profit, Key governance challenges, community service sector in Australia


Leadership style are ways and approaches used to provide guidance, program execution and encouragement to people. Leadership styles are used in any organization to implement the strategies and to increase efficiency of work (Yahaya& Ebrahim,2016). It affects the organization by impacting its decision-making process and measures of workplace performance efficiency. Effective leaders strategically examine the problem, evaluate subordinates' competency, consider alternatives, and take informed decisions. In selecting the most suitable form of leadership for the situation an effective leader makes a tremendous impact on the organization and its employees. There are various types of leadership, such as autocratic leadership, laissez-faire leadership, transformational leadership, democratic leadership among others. This essay deals with three leadership styles in details, autocratic leadership, laissez-faire leadership and democratic leadership.

Different styles of leadership can influence organizational output or results, particularly while implementing a change. Autocratic leadership is a style of leadership wherein the power to make decisions lies in the hands of the leader. Autocratic Leadership, commonly known as a tyrant administration, is a form of initiative adopted by the organization, where one person has control over the working of the organization, its administration and policy implementation. In such form of leadership, the leader holds the power to take any decision without consulting with the subordinates. Under such authority, there is centralization of power, which lies in the hands of the leader, and therefore the subordinates hold minimal interference or influential power. Consequently, the leader them self takes decisions in regards to the strategies and framework of the organization and the subordinates are bound by the decision taken by the leader (Chen, Dyball & Harrison, 2020).

Furthermore, autocratic leadership fits in organizations where the subordinates have low experience and training, this style is suitable for non-profit organizations wherein the service providers lack the required expertise to perform the delegated task and will benefit from the direction given by leader. Furthermore, this style of leadership in a non-profit organization will also ensure that service providers knows exactly what is to be done and the process of executing the task and since they do not have the required expertise to perform the task independently, this will ensure standardization of work quality across the whole organization (Yu, 2019). Moreover, since his type of leadership is ideally adapted in organizations where fast decision and implementation is required, the non-profit organization will benefit from such style as the leaders will be able to take decisions that will be effective for the community as well as the organization.

Democratic leadership style is often referred to as participatory leadership style. In this approach of leadership, leaders include their peers in the process of decision-making, as well as in determining the goals and objectives of the organization that has to be achieved. However, the power to make final decision resides with leader. This style is a perfect way to improve workplace productivity and can have beneficial impacts on the organization's daily activities if adequately implemented. Furthermore, this is the most effective approach for the leader to acknowledge the problem, and to determine the best possible solution to deal with it. Moreover, through this style, a leader produces high quality work and employees appreciate the inclusiveness and value their interest and therefore participate and respond with strong morals which give efficient result.

The leader creates strategies to help workers assess their own efficiency. This style helps employees to develop goals, facilitates work and promotions, acknowledges and supports employee accomplishment. This approach can be used in situations where the leader wants to be informed about issues that concern the employees and wants to understand the employee point of view in tackling the problem. However, this style proves to be less effective where an instant decision has to be taken and there is not enough time to get feedback from everyone.

This style can be suited for leading the non-profit sector as the members of community service working in non-profit organization are usually community members and since the main purpose of the sector is to provide service to the community and therefore, by including their voices and opinions, the community feels much more motivated to put in their best effort for the cause (Yu, 2019). Moreover, this is also beneficial when the management of the non- profit not from the community but the workers are from the community because the workers have grass root knowledge about the issues of the c and the most effective solutions specific to the community- an insight which the management will not have access to if it did not follow democratic style of leadership.

Laissez-faire leadership style is described as hands-off leadership style. In this style, the leaders have little interference and provide very little to no guidance. Furthermore, this style also grants workers full independence to perform their task. The decision of implementing decision for efficient work production is granted to the employees, and they set priorities, even take decisions on their own to overcome any problems being faced by them. This style is successfully used in organizations where workers are highly qualified and trained.

This is effective where the personnel have the potential to operate effectively and furthermore, when workers are comfortable and completely trained to perform tasks assigned to them (Huertas-Valdivia,Gallego-Burín & Lloréns-Montes, 2019). However, this style of leadership must not be opted where workers feel unsecured in the absence of a leader. This style of leadership will benefit the non-profit sector n scenarios where in workers or the service providers are subject matter expert and highly experienced in their area of work. This style also encourages motivation in workers by giving them agency and authority over the action and thereby also giving them a stake in the outcome.

Key Governance Challenges

Not-For Profit organizations have social goals, objectives or targets on which to perform rather than merely concentrate on return on investment (though economic stability continues an ever-important consideration) (Warburton, Moore& Oppenheimer, 2018). It is necessary to have mission, intent and path clear. There are considerable concerns linked with an undefined objective, including poor human and monetary use of assets, lack of lack of trust by contributors and fundraising entities, and presumably loss of credibility. As the scale and intricacy of Not-For Profit (NFP) organizations in the sector has increased, so has the value of good governance practice. The structure of the board focuses more on specific expertise, experience and competence than on sheer zeal for reason or object. Boards are becoming more competent in larger not for profit organizations by recruiting administrators with appropriate expertise and offering guidance for them in governance (Ferkins, Shilbury & O’Boyle, 2018).

The most prevalent problem found regarding Not-For Profit governance in Australia is the need to equalize the interests of various stakeholders. Unlike a corporate firm whose goal is to produce income for shareholders (possibly while also considering other stakeholder expectations to guarantee long-term profitability), an NFP organization can have multiple conflicting goals. A board will have to choose between the needs and desires of specific recipient parties, funders and administrators. For instance, contributors to nonprofits may place restrictions on how to spend money by defining issues that might not be in the interests of all recipients.

This pushes NFP organizations to 'go where the money is,' causing a scenario in which reliance on donors will undermine the purpose of the organization. This can lead to asymmetric transparency, a possible pitfall for NFP organizations (Megheirkouni,2017). When the investor’s priorities are not consistent with the beneficiary organization's objectives, uptrend responsibility to donors may be mismatched with downward accountability to service recipients.

Another governance issue that impacts the leaders and managers working in community sector in Australia is deciding the composition of the board. Australia is a hugely diverse country with multiple tribes &communities;therefore, it is imperative to ensure the right mix of cultural diversity in the board (Chelliah, Boersma& Klettner, 2016). The board composition will not only be a function of the skills, expertise & experience of the board members, but it will also be important to include the members belonging to the community and tribe that is being catered to. The right representation will help bring out the issues specific to the community which may otherwise be ignored. Additionally, the inclusion of board members from a community will also motivate the board to carefully analyze and assess the problems of the community and the potential ways of resolving them. Thus, to summarize, the board composition is a very intricate task that should involve a mix of right skill sets and the correct demography and cultural nuisances.

Similarly, another important governance issue is implementation of best practices in the organization. Some of the important best practices include understanding and demarcating the roles between management & governance, fiduciary and fundraising responsibility to ensure the proper & smooth functioning of the organization, ensuring accountability & transparency in the matters of organization and incorporating ethical practices in the board and working of the organization (Bowen, et al., 2017). These best practices are important to facilitate the best outcome of the community service.

For instance, while it is essential for the organization to raise funds for working, it is equally important to build trust in the community and the organization by adopting the measures of transparency & accountability for the members to feel motivated and attached to the cause. Similarly, clear definition and structuring of the role is very important among the board and the management to create clear boundaries about the expectation and authority of the various parties involved (Bajracharya & Khan, 2020). To summarize, the board and the leaders of nonprofits in Australia must make sure that the organizational best practices are followed both in the day to day operations of the not profit and at the top management and the board level to satisfy the legal, operational and community wide expectation of the non-profit.


Leadership styles define the working pattern of any organization. However, different leadership styles result in different framework. While every style has benefits and is effective in their own way, the organization must adopt the style which is most appropriate for the circumstances and conditions of their workers as well as the functioning of the organization. Not-for profit sector’s main objective is to provide service to the community and satisfy the community members by fulfilling the requirements and solving the issues that are being faced by them. For this, the organization must analyze the circumstances and conditions of their employees and must also consider the needs of the community.


Bajracharya, B., & Khan, S. (2020). Urban governance in Australia: a case study of Brisbane City. In New Urban Agenda in Asia-Pacific (pp. 225-250). Singapore: Springer.

Bowen, K. J., Cradock-Henry, N. A., Koch, F., Patterson, J., Häyhä, T., Vogt, J., & Barbi, F. (2017). Implementing the “Sustainable Development Goals”: towards addressing three key governance challenges—collective action, trade-offs, and accountability. Current opinion in environmental sustainability, 26, 90-96.

Chelliah, J., Boersma, M., & Klettner, A. (2016). Governance challenges for not-for-profit organisations: empirical evidence in support of a contingency approach. Contemporary Management Research: an international journal, 12(1), 3-24.

Chen, J., Dyball, M. C., & Harrison, G. (2020). Stakeholder salience and accountability mechanisms in not‐for‐profit service delivery organizations. Financial Accountability & Management, 36(1), 50-72.

Ferkins, L., Shilbury, D., & O’Boyle, I. (2018). Leadership in governance: Exploring collective board leadership in sport governance systems. Sport Management Review, 21(3), 221-231.

Huertas-Valdivia, I., Gallego-Burín, A. R., & Lloréns-Montes, F. J. (2019). Effects of different leadership styles on hospitality workers. Tourism management, 71, 402-420.

Megheirkouni, M. (2017). Leadership styles and organizational learning in UK for-profit and non-profit sports organizations. International Journal of Organizational Analysis, 25(4), 596-612.

Warburton, J., Moore, M., & Oppenheimer, M. (2018). Challenges to the recruitment and retention of volunteers in traditional nonprofit organizations: A case study of australian meals on wheels. International Journal of Public Administration, 41(16), 1361-1373.

Yahaya, R., & Ebrahim, F. (2016). Leadership styles and organizational commitment: literature review. Journal of Management Development35(2), 190-216

Yu, D. (2019). The Role of For-profit Educational Leadership Styles in Creating Shared Values, M.A. in Leadership Studies: Capstone Project Papers, 58, 1-40.

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