In a world that is always changing and moving in different directions every day, the role of leaders and managers has become increasingly important. Yet, there is often plenty of confusion about what each role entails. Understanding the difference between leadership and management is of crucial importance for businesses today.

Many studies reveal that people today generally feel like organizations are being over-managed and that true leadership is often missing. Micromanaging and over-controlling leadership styles embodied by important business figures, such as Elon Musk, are making people feel like the business world needs better forms of both leadership and management.

Let’s dig deep into each function to understand the difference between leadership and management.

Leadership is About Setting Direction

All great leaders have one thing in common: they inspire. Leaders are responsible for setting an organization’s direction, pressing for change, and building a long-lasting and empowering culture.

As John P. Kotter would explain, great leaders ignite people’s hearts and minds towards a better future. Leadership is about how to direct a following towards a common cause and keep people moving in the right direction throughout the journey. Leaders entice people to dream, hope, and be optimistic about the future that is to come.

Great leaders don’t stop at aligning people towards a compelling vision. They also develop the strategies that will create the changes required for that vision to be achieved.

Management is About Structure and Resources

While leaders press for change, great managers are savvy when it comes to planning and stability. Managers are responsible for establishing an organization’s structure and monitoring the progress that’s being made towards reaching common goals.

Unlike leaders, managers’ focus rests upon the company’s budgeting and profitability. Managers are responsible for problem-solving while journeying towards the leaders’ vision. It’s important to highlight that managers’ objectives are generally predetermined by leaders.  

When it comes to making operational decisions and optimizing team efficiency, managers are the ones taking the reins. Making smart organizational decisions on hiring, onboarding, and financing, to name a few, rest in management’s expertise and experience.

Managers are responsible for supervising, analyzing, and measuring the results of an organization.

Leadership Focuses on the ‘Whole’

Yet, a key difference between leadership and management is that leaders have a more holistic view. Because leaders set the direction for their organization or movement, they must appeal to their people’s inner motivations and emotions through inspiring messages.

Leaders don’t necessarily make plans, nor organize people. What they do, however, is inspire people to perform to their natural best every step of the way, along the journey towards their vision.  

Take Sir Richard Branson, for instance, who has built huge empires in the air travel, mobile, and recording industries. Today, he leads more than 200 companies and is one of the world’s most admired business leaders.

Is Richard Branson a great leader or a great manager?

You could argue both. But he is definitely a terrific leader. No manager would have the time to organize Branson’s portfolio of more than 200 companies. None. Because managing involves becoming actively engaged in a business’ operational efficiency, analysis of progress, staffing, and structuring companies. It would be simply too big of a workload for Branson to take on so many companies as a manager.

However, Branson does get to be named the leader of the Virgin Group. Why? Simply put, Branson established the direction for his family of companies. He pressed for change within the many industries’ his companies operate to break the status-quo, innovate, and build a multimillion-dollar empire.

Branson inspires people to dream and hope for a more exciting future.

He inspires his people while setting the direction for a vision of the future with a unique talent and capacity that very few leaders can articulate.

While he probably manages plenty of his companies, he definitely leads all of them.

Management Focuses on the ‘Individual’

While leaders focus their attention on the whole, managers place a higher emphasis on the individual. Leaders set the direction of their company and pursue a universal vision. Managers, on the other hand, focus on how that vision can be accomplished in the most effective and efficient way possible.

In the words of inspirational TED speaker Simon Sinek, leaders focus on the why while managers emphasize the how.

For this to be accomplished, managers ought to take care of the people they lead. To consistently unlock the best in people and create an uplifting environment, managers must understand what their people are naturally gifted in. This is, by far, the most important role of a manager.

John P. Kotter and other great management thinkers would agree that discovering people’s innate, and sometimes, hidden talents and turning that talent into performance is what sets great managers apart. That’s because skillful managers are enchanted with individuality itself. They seek it, admire it, and celebrate it.

That’s the beauty of management. When done right, it puts people’s talent to work in a way that benefits both the individual and the organization.

Above All, Unlike Management, Leadership is a Choice

The most important difference between leadership and management is that leadership, unlike management, is a choice. Leadership doesn’t depend on someone’s position, titles, or hierarchy, but rather on an individual’s desire to serve others.

To manage generally requires certain prestige and authority. In any organization, it’s very unlikely that you might find yourself managing people when you don’t have the authority, title, or prestige to do so.

Remember your first work internship? You probably weren’t given the chance to manage people!

One often has to climb their way towards having management authority within an organization. Why? Because management generally requires operational knowledge, industry expertise, and having a proven track record of having both a goal and people-oriented mindset – qualities that generally take time to develop.

A leader, as Brene Brown describes it, “is anyone who takes responsibility for recognizing the potential in people and ideas, and has the courage to develop that potential.”

Leadership is about showing up for people and inspiring growth, regardless of what position you’re in or how much power you hold.

Management Tips to Build Better Teams:

• Psychological safety. If your team doesn’t have it or feels it, it’s time to change things around and prioritize safety.
• Make sure people are coming to work not only for the company but also for each other. Like in sports, teams will never succeed unless they have each other’s backs.
• Abandon the rules. Embrace values. Rules create resentment and frustration. Instead, focus on values such as empathy, trust, belonging, and respect.
• Spend time with your team. Know what they like and dislike. Understand their background and their triggers. People’s talents and gifts are not always easily visible.
• Have tough conversations.  

Leadership Tips to Grow the Leader Inside You:

• It’s all about emotional intelligence and empathy. 
• Articulate a clear vision. People have to be able to imagine the vision they are pursuing.
• Engage with people in shared meaning. Use this to inspire action.
• Provide direction and intent. Empower others to discover the best route possible
• Nurture and develop future leaders. If your organization or vision depends solely on you, you are failing as a leader. Keep the vision alive by passing on the torch to the next generation of leaders.

In this sometimes messy and ever-changing world, the real challenge for businesses is to find the perfect balance, not only between leadership and management but also between results and values.

A desire to achieve results should never compromise values. It is quite the contrary, as an organizations’ values should always be the north star guiding its results.

At Topic Insights, we know that there’s a leader inside each and every one of us. It’s our mission to help you nurture and inspire that leader. For more content like this delivered straight to your inbox every Monday morning, subscribe to our newsletter. Questions? We’d love to hear from you. Contact us today.