Situational Leadership: The Key to Building High-Performing Product Teams

In today’s fast-paced SaaS and enterprise landscape, optimizing product team performance is critical to achieving business success. Yet, many companies make the same mistake repeatedly—assuming that every team member can be effectively managed using a uniform approach.

Different employees have varying levels of competence and commitment to the organization. This variability is why a one-size-fits-all leadership approach often leads to inefficiencies, misalignment, and underperformance. Enterprise product teams require adaptive leadership that evolves based on each team member’s needs and growth.

One of the most effective frameworks for addressing these challenges is Situational Leadership—a proven approach that tailors leadership styles based on individual team members’ competence and commitment levels.

Why Situational Leadership?

This approach helps organizations to:

• Retain top talent by creating an engaging, growth-driven culture 

• Improve product team performance by ensuring that each team member receives the right level of guidance, support, and autonomy based on their skills and motivation.

• Adequately assess Team member’s ability to move towards Business Goals.

Let's see how companies can leverage Situational Leadership model to drive better product execution, improve team morale, and deliver measurable business impact.

1. Directive Leadership for High Commitment, Low Competence

New team members or junior product professionals are often highly motivated but lack the necessary skills to execute effectively. This is where Directive Leadership is essential.

✅ What to Do:

• Define clear expectations and detailed task breakdowns

• Explain the what, how, and when of each deliverable

• Monitor progress closely and provide structured feedback

  
  

Example: A junior Product Manager struggling with writing user stories needs explicit guidance on structuring PRDs and prioritization frameworks.

2. Coaching Leadership for Moderate Competence, Low Commitment

As employees gain experience, they might still lack confidence or motivation. Coaching Leadership bridges this gap by blending guidance with autonomy.

✅ What to Do:

• Continue directive elements, but also explain the why behind decisions

• Involve team members in decision-making and encourage suggestions

• Provide structured feedback to improve competency and engagement

Example: A mid-level PM who understands Agile methodologies but struggles with stakeholder management. This PM will thrive in high-pressure situations—like managing a customer escalation or responding to an executive inquiry—helping them develop leadership skills and advance into a senior role. Applying coaching style boost their confidence by allowing some levels of autonomy.

3. Supporting Leadership for High Competence, Low Commitment

Experienced professionals may occasionally lose motivation or disengage. Here, Supporting Leadership ensures they feel valued and reconnected to their purpose.

✅ What to Do:

• Share decision-making responsibilities

• Offer encouragement and recognize achievements

• Facilitate collaboration and problem-solving

  
  

Example: A senior Product Designer who excels in UX but feels disconnected from the company vision can be re-engaged through strategic involvement in product vision workshops. 

4. Delegating Leadership for High Competence, High Commitment

For top-performing, self-sufficient team members, Delegating Leadership fosters ownership and strategic impact.

✅ What to Do:

• Fully entrust decision-making and problem-solving

• Monitor key outcomes without micromanaging

• Provide autonomy while ensuring accountability

  
  

Example: A Senior/Lead Product Manager who has successfully launched multiple features should be empowered to shape the strategic direction of a product in alignment with organizational objectives. This PM is a strong candidate for launching new products, identifying market expansion opportunities, or repositioning a product into a new category.

Summary

A high-performing product team is not built through rigid leadership—it is cultivated through adaptability, strategic guidance, and trust. Situational Leadership ensures that each team member gets the right level of support, autonomy, and challenge at the right time. This approach leads to higher engagement, stronger execution, and measurable business impact.

At 8-Figure CPO, we specialize in helping enterprise organizations and SaaS companies implement leadership frameworks that drive performance and profitability. If you're looking to elevate your product team’s impact while saving costs, let’s connect.

🚀 Let’s discuss how Situational Leadership can transform your product organization.