STATE

  • Alabama
  • Alaska
  • Arizona
  • Arkansas
  • California
  • Colorado
  • Connecticut
  • Delaware
  • Florida
  • Georgia
  • Hawaii
  • Idaho
  • Illinois
  • Indiana
  • Iowa
  • Kansas
  • Kentucky
  • Louisiana
  • Maine
  • Maryland
  • Massachusetts
  • Michigan
  • Minnesota
  • Mississippi
  • Missouri
  • Montana
  • Nebraska
  • Nevada
  • New Hampshire
  • New Jersey
  • New Mexico
  • New York
  • North Carolina
  • North Dakota
  • Ohio
  • Oklahoma
  • Oregon
  • Pennsylvania
  • Rhode Island
  • South Carolina
  • South Dakota
  • Tennessee
  • Texas
  • Utah
  • Vermont
  • Virginia
  • Washington
  • West Virginia
  • Wisconsin
  • Wyoming
By: Michael Doyle, Founder and Managing Director of DTech Advisors
Management vs Leadership and their Critical Value to being A Successful Entrepreneur

Too many entrepreneurs assume that the words “Management” and “Leadership” are interchangeable. They are not.  It is especially important for entrepreneurs to understand the differences because of the different roles they must take on to build successful ventures.

It is important to note that being a manager of a team does not make someone a leader. Similarly, being a leader does not make someone an effective manager. To be both a good leader and an effective manager requires developing both skill sets.

Good leadership ensures that teams understand and support the business vision and goals.  Good management establishes the tasks and activities, necessary for business success. Luckily, each are skills that can be acquired.

For greater clarity let’s start with business definitions of each:  

What is Management? – The Business Dictionary defines management as “The organization and coordination of the activities of a business in order to achieve defined objectives.”

What is Leadership? – The Business Dictionary defines leadership as, “The activity of leading a group of people or an organization or the ability to do this.”

But what exactly are the skills needed for each? It begins by first knowing what is important.

What do we have to know about management?  In my classes at Rutgers I talk about the basic functions of management.  These are the skills needed to build a business:

  • Planning – set goals, define processes, develop resource requirements, etc;
  • Organizing - organize teams, define tasks, assign people to those tasks, etc;
  • Influencing – influence staff, customers, other stakeholders to do what we need them to do;
  • Controlling – make sure that tasks are getting done correctly and adjust when they are not;
  • Staffing – build an effective team to do the work.

What do we have to know about leadership?  Daniel Goleman in his work on Emotional Intelligence has defined a set of skills that are required in leaders.   As with management skills, these can be learned and gained with experience. 

  • Self-Awareness – a leader must recognize and understand their own moods, emotions, what drives them and the effect on others;
  • Self-Regulation – a leader must control or redirect disruptive impulses and moods;
  • Motivation – a leader must have a passion to work for reasons that go beyond money or status;
  • Empathy – a leader must have the ability to understand the emotional makeup of other people;
  • Social Skill – a leader must have proficiency in developing relationships and building networks.                                                                                                                                                                                                

Now having established the critical differences between “Management” and “Leadership”, what does this mean to entrepreneurs? 

An entrepreneur who is truly intent on growing their venture should identify the specific management skills that they need to improve upon. If, for example, the entrepreneur is in the early stage of establishing the startup, then planning and influencing may be the critical skills to develop.  To gain those skills in a timely way the business owner has a range of avenues they can pursue.  This includes class time offered in training programs specifically tailored for entrepreneurs and there are online resources such as those referenced in this article. Mentoring is a great resource whereby a seasoned entrepreneur helps another through coaching—both formally and informally.  What is critical is that the entrepreneur dives right into what is necessary to address the challenge at hand and pursue the skill set necessary to move the business forward.  

Leadership can be approached in the same way.  If you are starting a business, then lack of motivation is probably not a factor.  As with management skills, simply knowing what you need to learn is the first step.  Reading Daniel Goleman’s article “What Makes a Leader” would be a good start.  It delves into many of the core elements of leadership. Identifying the skill (or skills) that would have the greatest impact is the next step. 

If your business is established and you have employees, then your needs will be different for both yourself and for your staff.  For example, identifying organizational skills for yourself and your staff could have significant impact if you are growing and there is a need to improve efficiency.  Likewise identifying a leadership characteristic such as one that would improve your relationships could have a significant impact.  While conversely, the lack of awareness of the need to develop one’s skill set in the face of greater demands of a growing business, could lead to setbacks that might have been avoided.

In my next articles in the coming months I’ll delve further into the leadership and management skills needed by entrepreneurs and why.

Remember - “The manager does things right; the leader does the right thing”. (Warren G. Bennis)

 

Resources:

American Management Association - http://www.amanet.org/

Center for Creative Leadership - https://www.ccl.org/

Harvard Business Review - https://hbr.org/

American Entrepreneurship - http://americanentrepreneurship.com/


Citations:
“What Makes a Leader?”, Daniel Goleman, Source: Harvard Business Review, November-December 1998

What Is Leadership? Retrieved from https://www.mindtools.com/pages/article/newLDR_41.htm

“Managing the Dream: Leadership in the 21st Century”, Warren Bennis, Source: The Antioch Review, Vol. 49, No. 1, A Victory for Humanity (Winter, 1991), pp.22-28 – retrieved from https://www.jstor.org/stable/4612304?seq=1#page_scan_tab_contents

“Why It's Time to Change our Views on Management and the Job of Manager”, Art Petty, source https://www.thebalance.com/why-its-time-to-change-views-on-management-4063555 

“Understanding the Differences: Leadership vs. Management”, source https://www.go2hr.ca/articles/understanding-differences-leadership-vs-management