A very wise man once told me that management was measured by efficiency and leadership was measured by morale. This simple sentence has stayed with me for many years and I believe that it is extremely pertinent and relevant. When people are placed in management roles, they tend to get very confused by these two tools and regularly blur them. This leads to a very important question; when should a manager lead and when should they manage?

Leadership is defined as a “process of social influence in which a person can enlist the aid and support of others in the accomplishment of a common task or goal”.  Common traits of leaders include power, vision and charisma. Leaders tend to lead by example and inspire others to action and they can get their teams to accomplish more than they ever thought possible. Leaders vary in style greatly however they regularly display these common traits. In the 1930’s and 1940’s, the nation of Germany sought financial security and economic greatness as they were swept up in a wave of fascism and authoritarian leadership under the now reviled Adolf Hitler. He was once a corporal; a battler like the masses who had risen to the top to represent them. On the flip side, the late Steve Jobs was known for his version of laissez-faire leadership. Jobs was known to share his vision with his team and let them get on with delivering it. If they failed to meet his lofty expectations, they were often dismissed without warning.Lead-Management

Management is defined as “the function that coordinates the efforts of people to accomplish goals and objectives using available resources effectively and efficiently”. It is about getting things done in the best possible way in the shortest possible time. Management involves planning and discipline and is the tool used to hold individuals and groups to account. Management tends to involve administration and data and can be seen as the less “sexy” task for senior executives. Well performed managers tend to have a low profile and are focused on the tasks and job at hand. Former Telstra CEO David Thodey would have to be regarded as a tremendous manager. Having taken over what could only be described as a broken business from the charismatic but deeply flawed leader Sol Trujillo, Thodey methodically rebuilt the business piece by piece. He cut the non-efficient components of the business and executed a plan ruthlessly. The business focused on efficiency and effectiveness and his approach was reflected in the growth in share price and consumer confidence.

So, when should you lead and when should you manage? There is probably no set answers to this but let me share my opinion. Leadership should come to the fore when you need others to step up and take positions that stretch them into areas where they are not comfortable. War time calls for leadership and the sporting field regularly does. Driving change through businesses certainly requires leaders with strength, substance and charisma. Acquisitions, takeovers and turnarounds are obvious times when leadership is key. Establishing new business units are another time. In these times, people look to their leaders and hope to see them calm and assured. They are looking to be inspired into extraordinary action.

Management needs to occur on a more consistent basis. In a perfect world of Utopia, there would be no need for management because each individual in a business would do exactly what was required every hour of every day of every year. However, we all know that this is far from reality. Management is needed to keep individuals focused on what is important and ensure that they know where their performance sits. Management needs to reward high performance and deal with under-performance. It needs to be based on real data and needs to be methodical in its implementation. The delivery needs to be consistent and offer no shocks. However, the cost of not managing is extremely significant. High performers will become disengaged as they will feel no reward for their achievement and low performers will meander along in unconscious incompetence.

It can be confusing for any new (or experienced for that matter) executive to consciously know when to manage and when to lead. Often executives don’t really know the difference between management and leadership. However, there are some significant differences and they need to be recognised by any executive. Those who get the balance right will most definitely have a very successful career ahead of them……..imagine an executive with the innate leadership skills of Nelson Mandela with the management skills of Warren Buffett…..and now imagine they knew when it was appropriate to use both skills.

Brad McMahon – Managing Director

One Reply to “When To Lead and When To Manage?”

Gary Whale
March 16, 2015

‘Pertinent AND relevant’? This is both tautological and redundant. I thought I taught you better than that. Actually, no I didn’t.

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