The terms 'leadership' and 'management' are often used interchangeably, but they are two distinct and complementary processes. Although ‘leadership’ is often considered a superior role to ‘management’, both are essential to all organisations, regardless of size. By understanding the key differences and strengths of each discipline, organisations can be better placed to make effective use of both.
What is 'leadership'?
There are many definitions of leadership, but the following from the CIPD is among the most concise:
"[Leadership is] the capacity to influence people, by means of personal attributes and/or behaviours, to achieve a common goal."
This is by no means a new concept. The history books are full of inspirational leaders like Alexander the Great or Abraham Lincoln. Yet the idea of ‘leadership’ has become increasingly important in recent decades as the pace of change has quickened. Companies now need to adapt quickly to new developments, like the rise of e-commerce and the competitive edge that new production processes can give. Obvious examples of recent business leaders include Apple’s Steve Jobs and Virgin’s Richard Branson, both of whom pioneered new avenues for their businesses while ensuring that the identity of their brands remained strong.
Yet leadership is not the sole preserve of the individual at the top of an organisational hierarchy. Anyone can display leadership ability. Consider an employee who helps resolve a problem for a disgruntled customer. If they handled the issue in an innovative way, then shared their experience with others and inspired them to adopt the new practice, they would have performed the role of a leader without even realising it.
What is 'management'?
John Kotter writes that:
"Management is a set of processes that can keep a complicated system of people and technology running smoothly."
It was required to build the Great Wall of China and to direct the armies of Rome, but it wasn’t until the Industrial Revolution that management became an everyday necessity. As cities swelled with workers from the countryside, managers were required to assign tasks and resources.
Since then, many organisations have grown to become global operators, with complex hierarchies that require management at all levels to be able to operate. Peter Drucker emphasised the importance of management when he wrote: "Without institution there is no management. But without management there is no institution."
So why is management often regarded as the lesser of the two skills?
In the 1960s, increased competition led to a general realisation that there was more to running a business than effective administration. The cult of leader as ‘hero’ began to emerge, with Wall Street CEOs like Jack Welch held up as role models for transformational leadership.
This view of leadership persisted throughout the 1980s and 1990s, with management seen by many as a bureaucratic necessity, rather than a positive force in organisations.
It is now acknowledged that both leadership and management are vital to an organisation’s success. Leadership is required to create a vision and encourage widespread support, but management is required to actually turn that vision into a reality.
For Kotter, neither is better than, nor a replacement for, the other. He states that: "the real challenge is to combine strong leadership and strong management and use each to balance the other."
So why the confusion?
Writing for the Harvard Business Review, Kotter outlines three common mistakes that people make when discussing ‘leadership’ and ‘management’:
They use the terms ‘leadership’ and ‘management’ as if they mean the same thing.
They refer to the top-level executive as responsible for ‘leadership’, while lower level leaders are ‘management’.
They consider ‘leadership’ a personality trait, usually associated with charisma.
Why does this pose a problem? Because it suggests that only one person within an organisation need consider the importance of ‘leadership’. Furthermore, this mindset suggests that ‘leadership’ is a trait which cannot be learned.
Consider the following table, produced by Wharton Business School’s Paul Schoemaker and Cornell University’s J. Edward Russo. It compares the most common traits associated with ‘management’ and ‘leadership’.
| Management | Leadership |
Direction | Planning and budgeting Keeping an eye on the bottom line | Creating vision and strategy Keeping an eye on the horizon |
Alignment | Organising and staffing Directing and controlling Creating boundaries | Creating shared culture and values Helping others grow Reducing boundaries |
Relationships | Focusing on objects – producing/selling goods and services Based on a position of power Acting as boss | Focusing on people – inspiring and motivating followers Based on personal power Acting as coach, facilitator, servant |
Personal Qualities | Emotional distance Expert mind Talking Conformity Insight into organisation | Emotional connections (Heart) Open mind (Mindfulness) Listening (Communication) Non-conformity (Courage) Insight into self (Integrity) |
Outcomes | Maintain stability | Create change, often radical change |
From this table, it is immediately clear that both management and leadership are essential for an organisation to run effectively and embrace change. Managers will always be required to create budgets, organise staff and sell products, but leaders are required to bring about big changes when necessary. In this way, the organisation remains competitive whether it is a business, public sector organisation or academic institution.
Perhaps one of the most famous examples of this is Art Fry, the co-inventor of the Post-It® Note. Fry was working at US manufacturing giant 3M when he learned that his colleague, Spencer Silver, had invented a weak adhesive. Silver was struggling to find a use for it, but Fry realised that it could be used to stop his bookmark falling out of his book and began to make samples.
Management were initially reluctant to back the idea, but Fry’s samples proved so popular that within two years the Post-It® Note was a staple of office stationary. [8] Fry demonstrated leadership by having both the vision and persistence to take the Post-It® Note from concept to reality.
Can you be both?
There is an inherent overlap between ‘leadership’ and ‘management’. Both require some degree of authority, even if that authority is based on perception, as in the case of leadership, rather than an officially assigned position. Most business leaders will have a number of people reporting to them and are therefore involved in management. At the same time, many individuals in management positions will influence others by using leadership skills.
According to Kotter, however, most organisations have too many managers and not enough leaders. To tackle this, he advocates a situation where superb leaders embrace the future and champion change, while superb managers run complex organisations reliably and efficiently.
Conclusion
All organisations need both leadership and management. The notion that one is inferior to the other is unhelpful to organisations as a whole because without an adequate mix of both it is difficult to ensure long-term success. Ultimately, leadership is required to create a vision and encourage widespread support, while management is required to actually turn that vision into a reality.
Reference: CIPD, ‘Leadership’ at: www.cipd.co.uk
Ojhn Kotter, Leading Change (Harvard Business Press, 1996)
John Kotter, ‘Management is (Still) Not Leadership’ at: blogs.hbr.org
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