Leadership vs. Management (Differences and Relevant Skills)

By Indeed Editorial Team

Published June 17, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

A company's leadership and management are vital factors that can influence its success and sustainability. While both terminologies share some similarities, there are some differences between them, especially when contextualizing their functions. Understanding the difference between leadership and management can help you learn when to apply their relevant competencies to achieve the best results. In this article, we discuss leadership vs. management, define both terms, highlight some differences between them, review when to lead and when to manage a team, and outline some essential skills for leaders and managers.

Understanding leadership vs. management

When comparing leadership vs. management, you may find that they have some overlapping functions. Both terms have different meanings and imply a unique set of skills, characteristics, and functions. They also show clear differences in various circumstances. For example, some managers may not practise or exude leadership, while an employee may lead without occupying a managerial role. Typically, companies appoint managers based on specific knowledge, expertise, and technical skills.

In contrast, the most important leadership trait is inspiring and influencing people. Generally, organizations require good managers to help ensure that employees perform their duties and remain aligned with the company's objectives. Companies also require workplace leaders that can coordinate and inspire colleagues and other team members. As a result, it's vital to have both competent leaders and managers in the workplace, as it helps ensure a company can achieve its vision and mission.

What is leadership?

Leadership refers to the ability to motivate a group of people to work towards a shared objective. It's management's ability to inspire others to perform their best, set and achieve challenging goals, and make quick, confident actions when required. Individuals who have leadership are responsible for managing operations and delegating tasks efficiently to help ensure the company reaches its objectives. The three major types of leadership in the workplace are:

  • Authoritarian leadership: Also known as autocratic leadership, this leadership style refers to a situation where the leader has full control over team decisions. They make the decisions on their own instead of consulting with team members.

  • Participative leadership: Also known as democratic leadership, this leadership style allows and encourages team members to speak up if they have ideas, opinions, or questions. Leaders who practise this leadership style typically consult others before making decisions that satisfy everyone.

  • Delegative leadership: Also known as laissez-faire leadership, this leadership style offers others a lot of freedom and independence. There's a more flexible hierarchy in a workplace that adopts this leadership style.

Related: Guidelines on Effective Leadership in the Workplace

What is management?

Management refers to the systematic process of organizing, planning, and controlling people or ideas. It also refers to the coordination of resources to help ensure the company reaches its objectives. Organizations typically have different levels of management, such as:

  • Top-level management: This refers to the highest level in a company, and it typically includes the board of directors and C-level executives.

  • Middle-level management: This refers to the second level in the corporate hierarchy, and it includes managers and heads of different departments. They're responsible for controlling and implementing plans and strategies created by top executives.

  • Lower-level management: Managers at this level include team leaders, supervisors, and first-line managers with direct communication and interaction with employees. They supervise the quantity and quality of output in an organization.

Related: What Is Management? The Definition, Functions, and Levels

Differences between leadership and management

Here are some key differences between leadership and management:

Value creation

Managers create value by directly supervising the activities of others. In some cases, they may reduce the overall value if their management styles interfere with employee productivity. In comparison, leaders create value by delegating responsibilities to others and independently creating value for the organization. For instance, a leader may delegate the responsibilities of an entire project to other team members while they focus on completing another task. This helps them create more value outside the team's output.

Power and influence

Managers typically create a circle of power where people come for advice or report. In contrast, leaders typically create a circle of influence that includes people within and outside their reporting hierarchy. A clear indication of leadership ability occurs when people commonly come to you for advice, regardless of the direct hierarchy.

Mission

With leadership, when there's a mission, each team member understands their duties, contributions, and responsibility toward achieving it. In addition, effective leadership inspires them to work towards the shared objective. With management, the manager ensures that each team member focuses on completing the individual tasks required to achieve a goal.

Self-awareness

Leaders typically have a high sense of self-awareness and may be confident to admit when they're wrong. They typically believe and trust that other team members can perform their duties and discharge their responsibilities. Comparatively, managers may adopt a command-and-control approach to their work.

Risk and trust

Leaders are more willing to trust their team members to do the necessary work to reach a common goal. They recognize the importance of taking risks, trusting their instincts, and putting faith in others to get the job done. In contrast, managers prefer to control and minimize risks.

Innovation

Leaders are creative, innovative, and open to exploring new ways and techniques to achieve their goals. In comparison, managers are typically less inclined to try innovative approaches and prefer to adopt familiar and tested approaches to reaching their goals. Although both managers and leaders can demonstrate innovation, due to the focus on hierarchy and responsibility involved in management, leadership roles support it more.

Output

You can measure effective leadership by the team's behaviour. For example, if employees are typically engaged, present, or satisfied, the leadership style may be effective. Similarly, when employees adhere to company policy or progress in their careers, you can also typically attribute that to the presence of good leadership. Generally, one way to measure the effectiveness of your leadership style is overall job satisfaction of the team.

In contrast, you can measure effective management with traditional performance metrics, such as quality and quantity of output, adhering to budgets, and meeting deadlines. For instance, if team members are constantly producing high-quality work, the management style may be effective. You can adequately manage employees by providing direct support to team members and checking in regularly to measure their progress on tasks and determining if they require any special guidance.

When to manage your team vs. when to lead your team

Knowing when to lead and manage your team can help you create a cohesive group that works well regardless of the situation. Managing and leading at the appropriate times can also help your team members succeed in their careers. Here's a list of circumstances of when to lead or manage employees:

When to manage your team

Consider adopting management tactics where team members don't have experience with their tasks. In these situations, team members typically require extra guidance and assistance. You can help them by telling them exactly what you want them to accomplish. Offer a clear and concise description of the goal and provide examples to serve as guides to help them understand their responsibilities. Other situations where you can adopt management tactics include:

  • during an emergency or crisis

  • for tasks that involve projects and processes

  • when assigning important tasks

  • when working toward a deadline

  • when a situation requires specific results

  • when training new team members

When to lead your team

You can employ leadership strategies when employees have strong capabilities for work and are producing good results. You can also apply leadership when you trust the skills of others, but it's necessary to define the goal. Situations where you can apply leadership include:

  • when you trust your team members to perform their responsibilities without micromanaging them

  • when you intend to introduce a new approach in the workplace

  • when employees have confidence in their abilities and efficiently perform their tasks

  • during team meetings and creative discussions

Related: What Is Strategic Management and Why Is it Important

Essential skills for leaders

Here are some relevant skills for leaders:

  • Communication: It's essential for leaders to have strong verbal and written communication skills. They can also practise active listening to ensure they understand others and respond appropriately.

  • Positivity: Leaders typically maintain a high level of positivity, even in difficult situations, to help ensure they maintain the morale of others.

  • Trustworthiness: It's essential for a leader to be trustworthy to ensure others can follow them. This involves demonstrating integrity and honesty when relating with others.

  • Creativity: Creativity is an essential skill for leaders to help them adapt to changing situations and develop innovative solutions to overcome challenges.

  • Delegation: As a leader, it's useful to know how to delegate tasks according to team members' abilities and empower them to perform these duties independently.

Related: Leadership Skills: Definitions and Examples

Relevant skills for managers

Here are some essential skills for managers:

  • Interpersonal skills: Also known as people skills, this refers to behaviours and tactics that people use to interact effectively and build relationships with others.

  • Motivation: While managers focus on maintaining a high level of productivity, it's essential to know how to motivate team members to perform their duties.

  • Organization: It's essential for managers to possess excellent organizational skills to coordinate activities to reach goals. This can include time management skills and scheduling to prepare for future events.

  • Strategic thinking: As a manager, it's essential to have the ability to assess a scenario and identify the necessary tactics and activities that help ensure the team reaches their objectives.

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