What is Leadership?
“Leadership” is probably the single most discussed topic in business literature today. An effective leader can inspire an organization to produce better quality products, ensure first-rate service to its customers, and make amazing profits for its stockholders. An ineffective leader, on the other hand, can not only negatively impact products, services, and profits, but ineffective leaders can also bring down an organization to the point of ruin. There should be no surprise that organizational leaders are very important and leave a lasting legacy not just on the companies they run but also on society as a whole. Table \(\PageIndex{1}\) contains a list of some important business leaders (you may or may not have heard of) from the 20th and 21st Centuries along with a brief description of what they accomplished. This amazing list of business leaders run the gamut from the small-town entrepreneur to people taking the helm at large international organizations. All of them are leaders, but their organizations vary greatly in what they deliver and their general purpose (both for-profit and non-profits).
Table \(\PageIndex{1}\) Management vs. Leadership
| Name |
Company |
Accomplishment(s) |
| Jeff Bezos |
Amazon.com |
Revolutionized how people buy products using the internet and then spurred a secondary revolution in the use of electronic books with the Amazon Kindle. |
| Steve Case |
America Online |
Founded Quantum Computer Services (eventually America Online), which became the largest online service in the world. His leadership and championing of a flat-rate fee for internet subscribers ultimately made the internet accessible for the masses. |
| Cynthia Carroll |
Anglo American |
After becoming CEO of Anglo American in 2007, a large international energy company based out of London, Carroll became very concerned over the number of fatalities in its South African mining facility. After another fatality, she shut the mining operation down for indefinitely shut down the operation and invited all relevant stakeholders to the table to discuss mining safety. Her leadership ultimately led to a complete retraining of mine workers and a revolution in mining safety in South Africa. Her leadership on the topic led to a 62% reduction in fatalities within her own company in just five years. |
| Joan Ganz Cooney |
Sesame Workshop |
Founded the Children’s Television Workshop (now Sesame Workshop) and invited the collaboration of Jim Henson. Today, there are 145 Sesame Workshop locations around the world creating unique and culturally specific programs for young children. Sesame Street has won 118 Emmys, more than any other show in history, and 8 Grammys over the years. |
| Ruth Fertel |
Ruth’s Hospitality Group |
After taking out a second mortgage on her home to purchase a local New Orleans’ steak house in 1965 she named Ruth’s Chris Steak House, she grew the chain to more than 75 locations around the world. Now the company has multiple restaurant chains and is publicly traded on the stock market. |
| Ruth Handler |
Mattel & Nearly Me |
Cofounder of the giant children’s toy empire Mattel. Her most lasting legacy is probably the creation of the Barbie and Ken dolls. After retiring from Mattel, she heads the Nearly Me company, which sold prosthetic devices for victims of breast cancer. |
| Hu Maoyuan |
SAIC Motor Corporation |
Maoyuan is the CEO of the SAIC Motor Corporation, the largest state-run automotive manufacturer in China. Historically, the organization has used partnerships with other automotive giants (e.g., GM, Volkswagon, etc.) to fuel its automotive needs. Under Maoyuan’s leadership he is now trying to be an exporter of Chinese engineered and built cars around the world. |
| Howard Schultz |
Starbucks |
After buying out the founders of Starbucks Coffee, Tea, and Spice, he created the niche industry of corner coffee shops. In an era when coffee consumption and sales were in a decline, Schultz created the largest coffee company and revolutionized how people socialized in society. |
While the above list of diverse leaders is interesting, examining what others have done (and are doing) is not necessarily the best way to help us understand what “leadership” actually is. However, before we can explain what “leadership” is, we need to differentiate between two terms that are often confused for each other: management and leadership.
Management
When one hears the word “management,” there is an immediate corporatization of the concept that tends to accompany the term. However, management (the noun) or managing (the verb) are very important parts of any organization. With the rise of the modern corporation during the industrial revolution, there was a decent amount of research examining how one should manage. For our purposes, we define the term manageThe communicative process where an individual or group of individuals helps those below them in an organizational hierarchical structure accomplish the organization’s goals. as the communicative process where an individual or group of individuals helps those below them in an organizational hierarchical structure accomplish the organization’s goals. Notice that the term is communication focused and active. Meaning that managing is something that is active and ongoing. Therefore, managementThose individuals who use communication to help an organization achieve its goals through the proper utilization of the organization’s resources (e.g., employees, facilities, etc…). would refer to those individuals who use communication to help an organization achieve its goals through the proper utilization organizational resources (e.g., employees, facilities, etc…). Theodore Levitt describes management thusly:
Management consists of the rational assessment of a situation and the systematic selection of goals and purposes (what is to be done?); the systematic development of strategies to achieve these goals; the marshaling of the required resources; the rational design, organization, direction, and control of the activities required to attain the selected purposes; and, finally, the motivating and rewarding of people to do the work.Levitt, T. (1976). Management and the post industrial society. The Public Interest, summer, 69-103, pg. 72.
Notice that management is focused on the day-to-day accomplishing of an organization’s goals. Furthermore, management must rally their employees to accomplish these goals through motivation, rewards, and/or punishments. Lastly, management must ensure that they have the necessary resources to enable their employees to accomplish the organization’s goals.
Leadership
Where management is focused on accomplishing the organization’s goals, leadership is ultimately envisioning and articulating those goals to everyone. Michael Hackman and Craig Johnson define leadership from a communication perspective in this fashion, “LeadershipThe modification of attitudes, beleifs, and values of a group in order to further an organization’s goals, mission, and vision. is human (symbolic) communication, which modifies the attitudes and behaviors of others in order to meet shared group goals and needs.”Hackman, M. S., & Johnson, C. E. (2009). Leadership: A communication perspective (5th ed.). Long Grove, IL: Waveland, pg. 11. From this perspective, leadership is less about simply getting goals accomplished, but rather about influencing the attitudes and behaviors necessary to meet the organization’s goals and needs.
Management vs. Leadership
So, how do we distinguish between management and leadership. One of the first researchers to really distinguish between management and leadership was Abraham Zaleznik who wrote that organizations often are caught between two conflicting needs: “one, for managers to maintain the balance of operations, and one for leaders to create new approaches and imagine new areas to explore.”Zaleznik, A. (1977). Managers and leaders: Are they different? Harvard Business Review, 55(3), 67-78, pg. 67. Notice that Zaleznik argues that management is about maintaining the path of the organization and about handling the day-to-day operations of the organization. Leadership, on the other hand, is about creativity, innovation, and vision for the organization. Look back at the list of leaders profiled in Table 7.1, all of these leaders had a clearly vision for their organization that was articulated to their followers. If these followers hadn’t been persuaded by their leader, none of these leaders’ accomplishments would be known today. While leaders often get the bulk of notoriety, we would be remiss to remind you that every effective leader has a team of managers and employees that help the leader accomplish the organization’s goals. As such, leadership and management are symbiotic and both are highly necessary for an organization to accomplish its basic goals.
In a study by Shamus-Ur-Rehman ToorToor, S. U. R. (2011). Differentiating leadership from management: An empirical investigation of leaders and managers. Leadership and Management in Engineering, 11, 310-320., the researcher set out to empirically investigate the difference between leadership and management by asking 49 leaders and senior executives in the construction industry in Singapore to differentiate between the concepts of leadership and management. Overall, four clear difference themes emerged in his research: definition, conceptual, functional, and behavioral.
Definitional Differences
The first differences noted in this research are what Toor called “definitional differences.” In essence, while there is no clearly agreed upon definition for the term “leadership,” Toor noted that management was “described by fundamental functions that include planning, organizing, leading, and controlling organizational resources.”Toor, S. U. R. (2011). Differentiating leadership from management: An empirical investigation of leaders and managers. Leadership and Management in Engineering, 11, 310-320, pg. 313. In essence, leadership tends to be characterized by terms like vision, inspiration, and motivation, while management was defined by terms like action, day-to-day running of the organization, and the mundane aspects of making an organization function. In essence, leadership is defined by the ability to create a vision for the organization that managers can then carry out on a day-to-day basis.
Conceptual Distinctions
Toor admits that often people have a hard time clearly distinguishing between the terms “leadership” and “management” because there is a thin line between the two concepts. As one member of Toors study noted, “Leadership is something that subordinates or followers look up to. A leader would be able to manage well, too. But managers are not necessarily good leaders, and subordinates look up to them for instructions, not guidance.”Toor, S. U. R. (2011). Differentiating leadership from management: An empirical investigation of leaders and managers. Leadership and Management in Engineering, 11, 310-320, pg. 314. In essence, leadership encompasses management but is seen as “more than” just management. Many of Toor’s research participants suggest that all good leaders would have to be good managers, but not all good managers make good leaders.
Functional Divergences
When interviewing the various Singapore leaders, functional divergences also emerged in Toor’s research. Leadership was characterized by two primary functions: challenging and empowering. In essence, leaders should challenge their followers to do more and then empower them to take chances, make decisions, and innovate. Whereas, management was characterized by two different functions: imposing and stability/order. From this perspective, management should impose guidelines and ideas that are generated by organizational leadership on their followers in an attempt to create some semblance of stability and order within the organization. In essence, management is not making the “big” decisions, but rather relaying those decisions to their subordinates and then ensuring that those decisions get implemented within the organization itself.
Behavioral Differences
Lastly, Toor found what he termed “behavioral differences,” or there are clearly two different behavioral sets that govern management and leadership. Managers manage their subordinates work and leaders lead by example. While these explanations are not overtly concrete, one of the participants in Toor’s study put it this way, “Maybe the difference is basically that you just manage in management, and you lead in leadership. In management, you enforce the regulations, whereas in leadership, you lead by example. In management, people don’t follow you; they obey you. In leadership, people follow you by their own choice.”Toor, S. U. R. (2011). Differentiating leadership from management: An empirical investigation of leaders and managers. Leadership and Management in Engineering, 11, 310-320, pg. 315.
Overall, there are clear distinctions (although admittedly convoluted) between the two terms “leadership” and “management.” We hope this brief discussion of this research has at least grasped that there are fundamental differences between the two concepts. The rest of this chapter is really devoted to leadership.
