Leadership vs Management: How the Roles of Leader and Manager Differ in Business

There are many definitions of leadership vs management and in reality they're very closely connected. Leadership is essentially about the big picture and vision for your business, whilst management is the process of implementing it. As a business owner you obviously need to be able to do both.

Business Coaching Insight:

If you're a good manager you staff are more likely to perceive you as a good leader too

Within the context of a small business, leadership involves determining the direction of the business, creating strategies for getting there and then inspiring your team to pull together to achieve it.  

As a leader of the business you are at the steering wheel of the ship. Your eyes are always watching the horizon, keeping track of progress, looking out for changes or opportunities and  communicating to the engine room and other departments about changes in direction.   

You are also the heart of the business in the sense that the culture, values and standards of the business will be determined by you.  

However, the owner of the business does not necessarily have to be the only leader. In fact, it's better for the health and performance of your business if you hire other people who are leaders too.

This doesn't mean you should hire lots of 'chiefs rather than indians' because leaders are not necessarily defined by their title or authority.

Every area of your business needs a leader who is prepared to step up and take responsibility for the performance of that area. 

Leadership vs management questions

So leadership is about the big picture whereas management is about the detail of making things happen.

To illustrate this here are some typical questions that you might ask within each role:

Leader Questions:

  1. Where do we want to be in 5 years?
  2. Does this decision align with our values?
  3. How can we improve what we do?
  4. What can I do to help my employees perform at their best?
  5. How can I create the conditions for peak performance from my employees?

Manager Questions:

  1. Have we got enough stock in this week?
  2. Should we change our suppliers?
  3. Do we have enough staff to complete these tasks?
  4. Are we meeting our budgets?
  5. When will this project be completed?
  6. Who has not paid our invoices this week?

As a business owner you have to wear many different hats and at various times you could be a leader (communicating your vision), a manager (making sure the job’s being done right) or even a worker/technician (mopping the floors!).

Business owners need the flexibility and skill to be both a good manager and leader.

In fact, if you're a well organized manager you are far more likely to have credibility as a leader.

Personality requirements

Business owners who happen to have a strong charisma and good people skills, may find it easier to attract people to their cause, but you don’t have to be a big personality to be a good leader.

Good leaders are often very quiet and unassuming people.

A lot of small business owners, especially those who may have started out as the ‘workers’, don’t necessarily see themselves as leaders but it is a role that anyone can grow into. 

Business Coaching Questions:

  • How do you think your employees perceive you as a leader?
  • How would you rate your leadership vs management skills?
  • What qualities or traits of a good leader have you noticed in other people that you would like to develop?


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