Comparing leadership styles in indoor farming

Photo © Adobestock

Each year, I go to two or more conferences on indoor farming, which provides an opportunity to see the latest and greatest technologies up close and interact with vendors. I also get a chance to attend plenary sessions and panel discussions with industry experts. But what I find most useful, and enlightening, are the conversations that I have with industry leaders.

For example, at the CEA Summit East 2025 conference hosted by Indoor Ag-Con and the Controlled Environment Agriculture Innovation Center in Danville, Virginia, I had the opportunity to chat with John McMahon of Equinox Growers and Carl Gupton of Greenswell Growers, among others. I also have had the pleasure of speaking with Nona Yehia of Vertical Harvest and other leaders on various occasions.

The folks I met at the summit were remarkably candid, on the stage and off, about their work, their goals and finding work-life balance. Not only did they share insights into the challenges of finding capital, managing employees and operations and securing new markets, but I also learned who likes to surf and who just had their first child.

Although a small sample, what struck me most about each of these leaders was how down-to-earth they are, how open, how willing they are to share their knowledge about what worked and what didn’t. I also learned how passionate they are about making both greenhouses and vertical farms successful, despite setbacks in recent years.

The question is: What does it take to be an effective leader of an indoor farm?

Challenges of leading an indoor farm

Indoor farms (e.g., greenhouses and vertical farms) pose unique challenges for leadership. On one hand, most are start-up organizations that require creativity, innovation and vision to get off the ground, especially vertical farms. On the other hand, once in operation, they need to maintain operational discipline (see my July/August column) to ensure accuracy, consistency and safety.

Consequently, the most effective leadership style for a vertical farm depends on the stage of the business and the mix of people, technology and operations involved. Put another way, because vertical farming combines people with high-tech systems (e.g., automation, data analytics, sensors) and biological processes (e.g., plant growth, climate control, labor-intensive tasks), the most successful leaders of these ventures must exercise two fundamentally different styles: transformational and transactional leadership.

Transformational leadership

In transformational leadership, leaders inspire, motivate and empower followers to achieve their highest potential and to work toward a shared vision that benefits the organization and society. Rather than focusing only on tasks or short-term goals, transformational leaders emphasize growth, innovation and positive change in both individuals and the organization.

The key characteristics are:

• Inspirational motivation: communicating a compelling vision that energizes and unites people around a common purpose.
• Idealized influence (charisma): acting as a role model, demonstrating integrity, confidence and ethical behavior that earns trust and admiration.
• Intellectual stimulation: encouraging creativity and innovation by challenging assumptions, inviting new ideas and supporting problem-solving.
• Individualized consideration: paying attention to the unique needs and development of each follower, offering coaching and mentorship.

In essence, transformational leadership is important because it turns vision into action not just by directing people, but by inspiring them to believe in and contribute to something greater than themselves.

• Communicate a clear vision for sustainable, tech-driven food production.
• Inspire employees to innovate (e.g., improving crop yield, reducing energy use).
• Build a culture of shared purpose and learning.
• Encourage collaboration among managers, growers, technicians and engineers.
• A transformational leadership approach is thus essential during start-up as well as when developing new systems, cultivating R&D, improving workflows, building teams or scaling operations.

Transactional leadership

Transactional leadership, meanwhile, focuses on supervision, organization and performance through a system of rewards and punishments. It operates on a clear exchange between leader and follower: “You do this, and you will get that.” In this approach, the leader sets specific goals, monitors progress and uses rewards to reinforce desired behavior or corrective actions when standards are not met. It is most effective in structured environments where rules, procedures and short-term objectives are clearly defined.

The key characteristics are:

• Clear structure and expectations: Leaders define roles, responsibilities and performance standards.
• Contingent rewards: Employees receive incentives for meeting targets.
• Active management by exception: Leaders monitor performance closely and take corrective action.
• Passive management by exception: Leaders intervene only when goals are missed.
• Focus on efficiency and compliance: Employees follow procedures to achieve consistent outcomes.

Transactional leadership is thus about managing through structure, control and reward rather than inspiring through vision or values. It’s effective for achieving consistent results, but unlike transformational leadership, it doesn’t aim to change people’s values or encourage innovation.

Once systems are in place, consistent execution is vital to an indoor farm to maintain certifications and meet yield targets. The focus thus shifts from inspiration to nutrient dosing, lighting cycles, sanitation, harvesting schedules and food safety compliance. The leader must set clear performance standards; enforce SOPs; reward accuracy, reliability and efficiency; and ensure that employees follow safety, hygiene and operational protocols.

What does it mean?

Henry Mitzberg, a renowned management scholar, once wrote, “Management without leadership is sterile; leadership without management is disconnected.” For him, “management” and transactional leadership were aligned, whereas by “leadership,” he meant transformational leadership. He argued that one without the other was incomplete. I agree. A successful vertical farm needs a leader who can exercise both transformational and transactional leadership styles as conditions warrant — a tall order indeed.

Author’s note: For those interested in learning more about leadership theory and the distinctions between managing and leading, I recommend the following: (1) Henry Mintzberg’s “Managers Not MBAs: A Hard Look at the Soft Practice of Managing and Management Development” and (2) John Sosik and Don Jung’s “Full Range Leadership Development, 2nd Edition.”