Difference Between Leadership and Management (With Examples)

In the past few years, the distinction between leadership and management has become clouded. People often confuse the two terms and use them interchangeably. However, that's not the case. 

Both terms have different meanings and roles. Leaders, as the term conveys, lead a group or organisation, whereas managers manage the day-to-day operations. Both are often put under the same umbrella due to the trend of educational institutes offering courses like "business management," which focus on both aspects. 

However, it's imperative to know the difference between leadership and management, especially if you plan to dive into this field.

What Is Leadership?

In its simplest form, leadership means leading human resources to accomplish a certain goal. But if we go into the nitty-gritty of it, leadership involves strategic planning, decision-making, communication, relationship building, motivating and inspiring people, managing conflicts, and solving problems.

Think of a leader as a guide. It is someone who can motivate people. A leader leads by example, inspires their team to perform better, and goes above and beyond for the organisation's success. 

For one to become a leader, one must have several skills. Although there is no universally defined list, here are some standard skills every leader should have: 

• Operating in a result-oriented way 

• Supporting others 

• Listening actively 

• Motivating and empowering others 

• Seeking and accounting for different perspectives 

• Solving problems efficiently 

• Embracing diversity 

In an organisation, a leader takes initiative. It could be anything, from starting a new project to solving an issue the company faces. Since good leaders are result-oriented, their initiatives align with the company's objectives. 

Part of the reason people confuse leadership with management is that back in the day, leaders formed the "management." However, things have evolved now. Management has a new meaning.

What Is Management?

Management refers to the performance of pre-planned tasks and responsibilities using available resources. The primary goal of management is to achieve organisational goals effectively. It involves coordinating with different departments in an organisation. 

Some common responsibilities of a manager include: 

• Planning and goal-setting 

• Budgeting and resource management 

• Organising and delegating tasks 

• Monitoring and controlling operations 

• Communication and decision-making 

If you look at it in terms of organisational hierarchy, managers are below leaders. However, this does not make management any less important. In fact, good management works in tandem with good leadership.

Management can elevate to leadership by inspiring and motivating others, seeking new perspectives, and solving problems. A manager might help employees do their day-to-day tasks. However, a leader would encourage them to grow and develop new skills.

What Is the Difference Between Leadership and Management? 

In a nutshell, leadership has long-term goals in mind, whereas management focuses on short-term objectives. However, that's not it. Both also differ in other domains. 

Let's take a look at them.

Subordinates vs. Followers 

The most striking difference between leadership and management is that one has followers while the other manages subordinates. A manager is in a position of authority and uses their power to get things done.

Suppose you're a marketing manager in a makeup corporation. It's your responsibility to ensure that all the campaigns run efficiently. You list your expectations and assignments in front of a team, and they work to fulfil them. 

If a problem arises, you try to solve it. You are also in contact with the top management and external stakeholders. 

On the other hand, a leader has followers. These people support and follow them, not because of their authority but because of their vision and influence. 

A leader in the same organisation would have a different role. They wouldn't manage daily tasks like following a content calendar or collaborating with influencers. Instead, they'd focus on bigger goals like growing the brand and developing new products. 

For instance, they may be working on expanding the brand to a new continent. Or they may be collaborating with a celebrity to launch a new makeup line. 

Vision-Based Differences 

We already touched on this earlier. But we'll now go into more detail. Leadership has a broader and more long-term vision. 

They don't merely focus on what's happening today. Instead, they want to lead their followers toward a brighter future. They have a purpose and a clear direction that they want to take their organisation in. 

Managers have more of a short-term outlook. They focus on the present and making the most out of it. In fact, they work on bringing the leaders' visions to life. In this case, the leader would set out an objective or an end goal. The managers would then divide it into smaller tasks and direct their respective teams to fulfil them.

Types of Questions Faced 

In most organisations, there are five main types of questions to be answered: how, when, what, who, and why. Of these, a leader faces why and what. A manager has to deal with when and how. Both are the ‘’who’’— the entities performing a job, be it in management or leadership. 

Again, we can continue the example of the makeup company. The management focuses on the how and when of things. When will the products launch? How will they be marketed? 

But the leader has to answer why and what. Why do we need a makeup line with this celebrity? Maybe they've recently appeared in a blockbuster or are popular on social media for their makeup skills.

What are the overall goals of this collaboration? It may bring in a new consumer base or increase the company's profits. 

Boundaries and Responsibilities 

Leadership has more freedom when it comes to boundaries and responsibilities. They are free to set their own boundaries and take on whatever responsibilities they deem necessary to achieve their vision. 

In contrast, managers have a specific set of responsibilities assigned to them by the leaders. They have less room for boundary setting as their tasks are clearly defined by those above them in the hierarchy. 

However, this doesn't mean that managers are limited in their decision-making abilities. They still have the authority to make important decisions within the scope of their responsibilities. However, they make these decisions staying in line with the organisation’s set of rules and regulations.

Change Creation and Management 

It's in the name — change management. That means management manages the change that occurs in the organisation. 

But who brings about this change? The leadership. 

In fact, the management has to face factors related to organisational change. The main factors include: 

• New technological implementation 

• New business models 

• Shifts in team structures 

• New leadership within a department or the organisation as a whole 

Now, if you look at it broadly, there are two types of changes in an organisation: adaptive and transformational. Adaptive changes are incremental or small changes that occur within the organisation's current structure and operations. In contrast, transformational changes are more significant and revolutionary. They involve changing the entire system or processes of an organisation.

Leadership is responsible for driving both types of changes. They set the vision and direction for adaptive changes while also leading transformational changes that are necessary to achieve their overall goals and objectives. 

Where does management come in? When it's time to implement these changes. Note that management doesn't envision these changes. It just executes them. 

Heroic as it may sound, a leader would have to fight through the organisation's immunity to change and implement new ideas. However, the management is responsible for the smooth transition and execution of these changes. So, it's teamwork, but leadership takes the first stride.

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Power, Position, and Authority 

Leadership develops power. Management exercises it. 

That's the crux of their difference. In a wider scope, a lot of authority lies with both of these roles in an organisation. However, the source and nature of their authority differ. 

Management exerts its authority through the official power structure of an organisation. They hold a particular position within the organisation, like being a manager or supervisor, which gives them the authority to make decisions and give directives. 

On the other hand, leadership's authority comes from their ability to inspire others. They may not have an official title, but their vision and charisma drive people to follow them and their ideas. They have informal power, which they exert personally and through the management. 

Similarities Between Management and Leadership

Sure enough, management and leadership differ in many regards. But they're also similar in some ways. Here are a few similarities that highlight the overlap between these two roles. 

Similar Objectives 

The end objective of everything leadership and management does is the same: the welfare of the organisation. One might take a more hands-on approach while the other works behind the scenes. 

However, their primary goal is to ensure the growth and success of the organisation. They may have different strategies, but their ultimate aim aligns. 

Complementary Roles 

Management and leadership are two sides of the same coin. While management maintains order and structure, leadership fosters innovation and change. 

Together, they create a balanced approach that helps an organisation function efficiently and adapt to changing circumstances. 

Similar Skillset 

The skills needed to excel at management or leadership are somewhat similar. Sure enough, one might need a few extra skills to be a leader, but the basic skillset is the same. 

It includes: 

• Problem-solving 

• Strategic thinking 

• Effective communication 

• Decision-making 

• Time management 

Both also have to be transparent in everything they do. They must realise the importance of accountability, too. 

Another important trait both must possess is empathy. Gone are the days when a leader or manager had to be stern and apathetic. Today, employees respond best to leaders who understand their needs, concerns, and emotions. 

That's why research has called empathy the most important leadership skill. 

Notable Traits of a Leader 

To fully understand the function of a leader in an organisation, it helps to know their traits. The following traits describe a contemporary leader rather than a traditional one. 

Follower of the "Servant" Approach 

Yes, we know it sounds a bit ironic. Many people debate about the nomenclature of this modern leadership approach. But the bottom line is that its actual meaning holds true. 

The "servant" approach says that instead of controlling their followers, a leader must be in service to them. In simple words, leaders are meant to make people's lives easier, be it physically, cognitively, professionally, or emotionally. 

Per this approach, leaders practise compassion, gratitude, empathy, self-care, and self-awareness. They create a physically and psychologically safe environment for their team members. 

For instance, team leaders are no longer only responsible for ensuring the organisation's objectives are met. They also have to ensure that different races, genders, and sexual orientations coexist harmoniously. Employees with special needs must also be accommodated.

Ability to Challenge 

It's one thing to follow the status quo and roll with it. But it takes guts and courage to challenge the norm. Leaders must be able to question traditional practices and processes and propose innovative solutions. 

The said trait is especially important in today's rapidly evolving business landscape, where change is constant and necessary for survival. Leaders who can think critically steer their organisation toward success. 

An excellent example of such a CEO is Isaac Perlmutter, Marvel's CEO. He owned Toy Biz, Inc. in 1996 when Marvel went bankrupt. After merging his company with Marvel in 1998, he managed to bring the company back to its feet. He improved Marvel's stock price and cash flow by focusing on licensing for products and media at Marvel. Since then, the company has reached a valuation in billions.

Inspiration 

No leadership is complete without the ability to inspire. Leaders take the first step. Then, everyone else follows. 

While everyone else is looking at things in a smaller context, the leader is looking at things from a more significant point of view.

Notable Traits of a Manager 

A manager shares many traits with a leader. These are communication, time management, effective decision-making, and adaptability. But there are a few additional traits a manager must have to meet their day-to-day job requirements.

Ability for Vision Execution

A manager may not have a vision, but they have to execute someone else's. Managers must be able to turn a strategy into reality, managing resources and people effectively to achieve a specific goal. 

They need to have a clear understanding of their organisation's objectives and strategies and align the team's efforts accordingly. For instance, if an organisation's goal is to increase market share, the manager must ensure that every team member is working towards achieving that goal.

Strong Direction and Delegation Skills

Managers direct their subordinates. How do they do that? By delegating tasks. So, a manager should be adept at both these things. 

They should know which tasks to delegate to whom, depending on their strengths and weaknesses. Similarly, they should be able to direct the team to fulfil their responsibilities.

Effective Process Management 

Everything employees do in an organisation can be called a process. It may be something as small as responding to an email or as big as launching a new product. 

Managers have to manage these processes from start to finish. Let's take a product launch as an example. It includes: 

• Brainstorming the product idea 

• Working with vendors and external stakeholders, if applicable 

• Creating a team for product development

• Defining roles and responsibilities

• Coming up with a timeline 

• Market research and analysis 

• Product development 

• Marketing and advertising 

• Distribution

Managers don't only have to ensure the smooth execution of these tasks. They must also do it all within the given budget and timeline.

Transitioning From Management to Leadership: The Hallmarks 

In an article, the Cranfield School of Management describes the current decision-making environment as a VUCA environment (of Volatility, Uncertainty, Complexity, and Ambiguity). They further explain that transitioning from management to leadership in such an environment is becoming increasingly difficult. 

But it's possible. Here's how.

Breaking Old Habits 

Humans have a natural tendency to stay in their comfort zones. That's why senior managers are often too reluctant to give up on their old ways of doing things. However, in a constantly evolving business landscape, adapting to new practices is crucial for success. 

For a manager to become a leader, they must let go of old habits and embrace new ways of thinking and doing things. That requires self-reflection, open-mindedness, and a willingness to learn and change. 

Becoming an Observer 

Part of the management's job is being "fixers." They see a problem and immediately jump in to fix it. But leaders take a long-term strategic approach. They are observers, always looking at the bigger picture and considering how their actions will impact the organisation in the long run. 

To transition from management to leadership, managers must start viewing themselves as leaders and not just problem solvers for today's issues. They should be constantly asking themselves how their decisions can resolve a problem in the long run.

Developing a Leadership Mindset

The mindset makes all the difference. It's not merely about changing job titles but rather a fundamental shift in thinking. A leader's mindset focuses on developing teams and individuals while fostering growth. They're not afraid of change. Instead, they embrace it and see it as an opportunity for improvement.

Managers must cultivate this leadership mindset by setting aside their egos and personal ambitions for the greater good of the organisation. 

Anne-Marie Balfe, EY's talent leader in Africa, India, Europe, and the Middle East, says leadership requires a "sense of purpose" and a "common vision." There must also be clear accountability and governance to keep a check on the organisation's progress. 

She says that leaders "support and inspire others to be their best." How do they do this? By setting examples. They have to challenge themselves to fulfil the demands of the oncoming change. When they do this, it creates a ripple effect around them, eventually influencing the entire organisation.

Honing Leadership Skills 

Management skills can surely morph into leadership skills. But that's only possible if managers hone specific skills that define a leader. 

Prashanth Puthran, FCMA and a finance leader in the pharma industry, lists the following qualities a manager should hone to become a leader: 

• Emotional intelligence 

• Good listening 

• Self-awareness

• Good communication 

• Empathy 

But they shouldn't stop at instilling their qualities in themselves. They should also find a way to ingrain them in those around them.

FAQs

Is Leadership More Important Than Management? 

They're equally important and are intertwined with each other. Leadership is a crucial factor in the success of an organisation's long-term goals, while management skills focus on day-to-day operations. Both have to work hand in hand to achieve organisational success. 

Can Anyone Become a Leader? 

Yes, anyone can become a leader. It's not just about inborn traits but also skills that can be developed and honed over time. Certain people may have natural abilities to lead, but with the right mindset and dedication, anyone can join the ranks. 

How Can I Develop My Leadership Skills? 

You can develop your leadership skills through self-reflection, relevant education, skill enhancement, and continuous learning. 

How Do I Know If I Am A Good Leader?

There is no one-size-fits-all answer to this question, as leadership styles and effectiveness can vary from person to person. However, some key indicators of a good leader include strong communication skills, the ability to inspire and motivate others, adaptability, empathy, and a commitment to continuous improvement. 

Conclusion

There's no denying that there's a clear difference between management and leadership. But it would be wrong of us to say that the former cannot elevate to become the latter. 

All you need is a ton of self-reflection and some educational assistance. The latter comes through a course, such as the Professional Academy Diploma in Leadership & Management from UCD Professional Academy. Think of this course as the blueprint you need to develop your leadership skills and break through barriers. 

Why stop there, though? Leadership is a constant learning process. You can always take more courses in business and leadership to become the best leader you can be. Check out more courses here.