"Management is doing things right; leadership is doing the right things." – Peter Drucker, management consultant
"Effective leadership is putting first things first. Effective management is discipline, carrying it out." – Stephen Covey, businessman and educator
Most experts would agree that leadership and management are two different things. And most business owners would agree that you need both.
The Essential Difference
I believe that leadership is about providing inspiration and vision, setting examples and standing up for the meaning and value of the business. I think management is about setting expectations, tracking results and taking actions around good and bad performances.
People usually believe in a leader, but the manager is more of a boss who has to say no and deals with bad news. A leader is like a band leader for a big band, the top musician—they are all about the style, tone and expression of the music. The band manager, on the other hand, is about the logistics, money, transportation and execution. The leader may be considered a star. The manager can be thought of as a nag.
"People ask the difference between a leader and a boss. The leader leads, and the boss drives." – Theodore Roosevelt, 26th President of the United States
Is it possible to be both leader and manager in your business? Yes, if you do it right.
The Leadership Umbrella
I watched a real case first hand. It involves the charismatic founder of a software company, the visible leader, and his right-hand man, the manager.
The founder—a software genius, personality and driving force—was a dynamic leader. He went on to several other startups after he exited from this first one. Under his leadership, the software company grew from zero to tens of millions in annual sales in barely four years. He was the face of the business and its personality, and he was the guts of the software too, working long hours into the night, coming up with new ideas.
The manager was always in the background. The founder, lost in the drama of software creativity, seemed above all the mundane specifics of management, but he always listened to the manager. And he made it clear throughout the organization that the manager called the shots.
When the first software product took off, sales doubled monthly. The manager stayed focused on getting the products built, managing inventory, minding the cash flow, getting the phones answered and getting the rapidly increasing volume of orders shipped. When distributors offered high volume sales while the monthly growth of direct sales was close to unmanageable, it was the manager who said, "No, wait until later." He said that the move to distribution channels too quickly might kill the company because of implications on inventory and working capital. And the founder listened and followed his advice.
The secret was the support, trust and backing that the founder always gave the manager. It was always all eyes on the founder, but he, in turn, always made it clear: The manager keeps us real. We all respect and listen to the manager.
I've seen it many times since. I call it the leadership umbrella. The leader represents the high-level vision, not the details, but they also support, defend and empower the management. The company culture respects the management because people follow the leader.
When It Doesn't Work
I've found that the leadership umbrella doesn't work when a would-be and should-be leader treats the manager as a threat. The leader might be too anxious to be liked. Management may not get the leader's support, but may be on the receiving end of backbiting and rolled eyes instead. The leader may undermine the manager. I'll bet you've seen that dynamic before. Why, the leader seems to ask, would we be bothered with all that? Don't be a downer.
It also doesn't work when the manager undermines the leader. The manager may say, or imply, that the leader isn't being practical, doesn't understand the business, reaches too far and so forth.
Which Are You: Leader or Manager?
While business lore may include some stories of people who are both leaders and managers, I've found that these people are quite rare. Ask yourself which one you are by nature. Ask yourself how the leadership and management dynamic works in your organization. Do you need both? Do you have both?
One thing both leadership and management have in common: they are both defined by results. That's where you, the business owner, come in.
Read more articles on leadership.