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. Are you managing, leading, or both?
Managing Operations
Traditional management concepts focus on 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 these skills are 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 these systems and controls 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.
Managing Culture and People
In many ways, the traditional perspective of managing a business 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 has become 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. Leadership involves tangible action that seeks to inspire, motivate, mentor, coach, communicate the vision, and influence behaviors. Effective leaders understand the need to empower their team to follow through with the necessary day-to-day operations through delegation, trust, and a culture of community that feels equally vested in the mission.
Marrying the Goals of Management and Leadership
Ultimately, your business requires the scope of both qualities to effectively manage business operations, drive a shared vision and culture of community, and continue the overall enterprise’s growth and expansion. This requires collaboration and relationships within the organization.
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, ensuring it is cost-effective, and continuously striving to improve.
Likewise, failing to look toward the future and communicating a clear vision 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, building a clear vision for the business to pursue, and creating an environment that inspires buy-in from all stakeholders, regardless of where they are in the hierarchy.
“Managers work to see numbers grow. Leaders work to see people grow.” -Simon Sinek
Not everyone is equally capable of being a great manager and great leader, but both skills are necessary. Finding the methods and means to be both can be a daunting challenge. Starting with the 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 possible. Talk with your employees and 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 and the attitudes of all stakeholders.
In the end, the seeming opposites of management and leadership are two sides of the same coin. A successful business must have both, and this is the ultimate challenge for the business owner.
At Cogent Analytics, we never stop looking for ways to improve your business, and neither should you. Check out some of our other posts for helpful business information:
