The difference between management and leadership has been argued, debated and written about by many people. The issue seems to come down to recognizing that both skills are necessary to effectively run a business, whether the business is a large corporation or a small family owned business. The challenge for everyone to understand is that there is an inherent paradox in the need to be able to use both types of skills.
Traditional management concepts are concerned with getting the most productivity and efficiency from existing systems and processes. Being a good manager requires a person to engage in activities striving toward specific outcomes or objectives. An effective manager plans, organizes, coordinates, minimizes risk, solves problems, makes decisions, and implements controls and predictability into the business. Anyone with any business experience knows all of these skills are absolutely essential for a business to operate successfully. Without someone acting to achieve the specific outcomes the business can easily spin out of control and fail.
In managing a business the key is developing and implementing the necessary systems and controls providing information and tracking progress to short term goals are absolutely necessary. So is knowledge of what these systems and controls are and how they work. When these are in place, it becomes possible to delegate responsibility for monitoring and reporting results to you, the business owner. A good manager will delegate the responsibility and regularly check on the progress and only intervene when the situation requires.
This traditional perspective is still as valid today as it was in the nineteenth century when modern business practices first developed. However, as business has evolved the need for an effective means of sustaining profits and growth became inescapable. Workers today are not like the workers of the industrial revolution. In those days, a strictly management driven business environment was sufficient. They had clearly defined hierarchies of people with “bosses” and “subordinates.” As time progressed, the need for business leadership to work along with business management developed.
Leadership is a capability that many people find difficult to define – but they know it when they see it. It is often characterized by terms that are the inverse of the terms describing management. These terms used to describe leadership include: inspire, motivate, risk taking, mentor, coaching, vision, climbing to the next level and changing minds. In many ways leadership is about the way things can be through improvement and innovation.
An effective manager or leader must rely on both sets of skills and talents to effectively manage business operations, as well as continue the growth and expansion of the overall enterprise. The focus on efficiency and achieving short term objectives cannot be neglected without serious damage to a business. Not paying attention to the day-to-day business operations and results will surely doom a business very quickly. Effective management is highly focused on the internal operation of the business and making sure it is cost-effective and continuously striving to be better.
Likewise, failing to look toward the future will result in a business that eventually stagnates and loses its ability to compete in the marketplace. Have you ever heard the old saying, “What could go wrong, asked the buggy whip maker?” This quote seems silly today, but at the dawn of the age of the automobile, there were many businesses that could not see the need to change or adapt to changing conditions in the world.. The role of the leader is to keep an eye on what is going on around the business and to lead the organization and the people to meet the challenges and capture the opportunities that arise from outside the business. Business leadership requires looking forward and building the vision for the business to pursue.
Not everyone is equally capable of being a great manager as well as a great leader – in fact almost no one can excel at both skills, but both skills are necessary. However, you must find a way to be both a business manager and a business leader. Finding the methods and means to be both can be a great challenge. Starting with fundamentals of good management controls and practices will set a solid base for your business. Learning to lead effectively can be more challenging but it is very possible. Talk with your employees, other people in your specific market or community, look outside your business and think about how what you see and hear can affect your business.
In the end, the seemingly opposites of management and leadership are two sides of the same coin. A successful business must have both, and this is the ultimate challenge of the business owner.
At Cogent Analytics, we never stop looking for ways to improve your business and neither should you. So, check out some of our other posts for helpful business information:
