Pros and Cons of Informal Business Leadership


Informal leadership is where leadership responsibilities and tasks are given to an employee with the goal of helping them grow and learn outside of their traditional job description. This seems like something that should always be positive, but like anything else in the workplace, each decision or change within a leadership structure can have pros and cons

Read on to learn more about the pros and cons of informal business leadership for your business and employees.

Additional Leadership in Workplace

It’s always nice to have a few extra hands on deck in big projects, but without having designated informal leaders within teams, it can be hard to recruit people to jump on board. Informal leaders have great power among the staff because while they are leaders, they don’t have the formal titles and are seen as more of a peer.


“Informal leaders are great team players,” says Phillip Montalvo, Director of Marketing at Azuna. “They can be that olive branch that connects us, as formal leaders, to the rest of our staff.  They often provide insight that we never would know or hear about because they float between the two circles and are able to bring things to our attention.”


“Depending on how your informal leaders handle things, informal leadership can make things difficult if they’re not working well together,” says Brandon Lurie, Marketing Director of Y Meadows. “Leaders are often confident and know how they want to do things. However, those ideas don’t always align. Too many leaders or leaders in informal positions can cause friction between leadership roles because of the number of opinions being voiced by so many strong influencers.”

Higher Skill Levels

Having better skilled employees sounds like a great thing, right? You would think this would be a major ‘pro’ category, but it turns out that there is such a thing as being overskilled for a position. While it’s an amazing thing to see your staff grow and learn new things, it often leads to other situations down the road that you’ll need to prepare for so you don’t run into ‘cons’.


“Having your staff consistently improving their skills through informal leadership practices can lead you to having a wonderfully well-oiled machine,” says Max Schwartzapfel, CMO at Fighting for You. “Being a good leader is about so much more than being in charge and practicing these skills will help each informal leader become a better teammate too.”


“Advancing skills are fantastic if you’re giving your staff goals to advance towards too,” says Chris Bridges, CEO of VITAL. “However, if they feel they’re acquiring skills but not using them or advancing in their career in any way, they’re likely to start feeling restless and stagnant in their current position. You may end up inadvertently training people to leave you if you’re not careful.”

Praise High Achievers

Informal business leadership roles can help your employees strive for greatness. It’s no secret that each workplace has natural born leaders and sometimes these people aren’t the ones who have been there longest or earned the highest degree. These individuals often have the capability to achieve heightened expectations and goals compared to their peers. Reward their efforts by extending an olive branch in the form of informal leadership responsibilities.


“Using informal leadership roles as a reward for motivated and high achieving employees can be a great way to increase the motivation levels of your team,” says Brett Estep, COO of Insured Nomads. “If others see their peers striving for these positions, they may be more likely to work toward that same goal. Showing the importance of skill acquisition and leadership qualities can be an excellent motivator for the rest of your staff.”



“Some staff may feel slighted or neglected if they’re not chosen for an informal leadership role,” says Jae Pak, Founder of Jae Pak MD Medical. “If there aren’t clear definitions to identify who qualifies for informal leadership roles and why, then some staff may complain that you’re playing favorites or not being fair to people who have other qualifications such as their time working for the company or their degree level.”

“Fresh” Perspectives and Energy

Most workplaces in today’s day and age are multigenerational. With Gen Z starting to enter the workforce, there may be as many as 4-5 generations working together on the same team. Take advantage of the energy and perspectives of your younger generations by allowing them to take on informal leadership roles that don’t require the years of experience or the education level that a formal leadership position would.


“There is such a value in the perspectives of a multigenerational workplace,” says Tyler Read, Founder and Senior Editor at Personal Trainer Pioneer. “Gone are the days where we had to have a certain “type” of person in a leadership role or even the requirement that a leader has to have certain experiences. Allowing your younger generational staff to take on leadership roles and practice new skills can be a wonderful way to bring a new perspective to your brand.”


“Not everyone in the workplace will react well to being told what to do by someone decades younger than them without the experience they have,” says Juan Pablo Cappello, Co-Founder and CEO of Nue Life. “You’ll need to prepare for potential conflict that can happen because of generational differences and understandings of leadership qualifications among your entire staff and not just those you’re looking to move into informal leadership positions.”


In conclusion, informal business leadership can be a great thing to implement if done well. It’s something that must be approached with organization and intentionality to reap the benefits of things like higher skill levels, additional leaders, motivation levels, and fresh perspectives.

These benefits have the ability to elevate your brand by incorporating new perspectives and ideas through the informal leadership approaches that your staff bring to the table.

If these things aren’t navigated with care, it can lead to a whole list of ‘cons’ as seen above. To avoid this, you will need to consistently evaluate the informal leadership tactics and know how to adjust your standards and expectations as needed. It’s also important that your entire staff understands the informal leadership positions and has respect for those who have been placed in them. Communication of the roles and responsibilities of these informal leadership positions will be the key.