Leaders within South African organisations and corporations are faced with challenges such as over-management and under-leadership. While management is about coping with complexity, leadership is about coping with change. In the actual business environment, foremost changes are progressively necessary for business survival and effective competition. In fact, the effective leadership is measured by organisational effectiveness. However, by displaying an effective leadership, leaders are called not only to influence subordinates but also enable them to achieve the organisational goals. Therefore, the effective leadership will not be focused on supremacy but on the organisational achievement. This requires an important and permanent participation and consultation of all team members. The present research study is focused on the analysis of the role of situational leadership in the context of small business management. The main purpose of this research is to examine and to criticallyevaluate the use of different situational leadership styles in the management of small businesses.