Great article. Been there done that! What I do find interesting, is typically in a small business, the ownership is made up of several members, or at least the owner has close confidants, in the company or around them who share the same  socio-economic background. They tend to form a homogeneous group, meaning they think alike.  This is why diversity in general terms works well in small businesses. Just because all executives think alike does not mean they are right. In fact, I have seen many a small company sink because of their inability to look 'outside' their circle for help and expertise.

Another significant problem with this leadership style is your top performers are always looking to better themselves, period. Be it with you or someone else. If you have this blanket iron-first policy, it wears your top performers to the point of loss of employment. The irony here is top performers do not leave you for another industry, they go to your competitor! So you are eventually left with a bunch of complacent employees you have no desire to excel or grow. They are quite happy punching the clock. This is can be reason number six of why the iron-fist technique rarely works long-term.