Business 101: Principles of Management

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Are all managers leaders? Are all leaders managers? This lesson presents arguments that place a manager and a leader into two separate categories, each with their own defining characteristics.

Are All Managers Leaders?

Ask yourself this question: are all managers leaders? Some of you will quickly answer 'yes' assuming the two are synonymous with one another. Others will think back to some of their managers and evaluate them as someone who they either do or do not consider a leader. Many of you might immediately respond 'no' to this question because you have heard of the management versus leadership debate in the past and know very well that the two are, in fact, quite different. Regardless of your initial response to this question, this lesson will present arguments that place a manager and a leader into two separate categories, each with their own defining characteristics. This is not to say that there are not similarities between managers and leaders; rather, the essence of this lesson is to show that not all managers are in fact leaders.

While not all managers are leaders, there are similarities.

What Is a Manager?

A manager is a person in an organization who is responsible for carrying out the four functions of management, including planning, organizing, leading and controlling. You will notice that one of the functions is leadership, so you might ask yourself if it would be safe to assume that all managers are leaders. Theoretically, yes - all managers would be leaders if (and this is a big 'if') they effectively carry out their leadership responsibilities to communicate, motivate, inspire and encourage employees towards a higher level of productivity. However, not all managers are leaders simply because not all managers can do all of those items just listed. An employee will follow the directions of a manager for how to perform a job because they have to, but an employee will voluntarily follow the directions of a leader because they believe in who they are as a person, what they stand for and for the manner in which they are inspired by their leader. A manager becomes a manager by virtue of their position, and subordinates will follow the manager because of his or her job description and title.

People follow a manager because of his or her job description.

Because managers are responsible for carrying out the four functions of management, their primary concern is to accomplish organizational goals. Managers get paid to get things done in organizations. As such, the manager is accountable for themselves as well as the behavior and performance of his or her employees. A manager has the authority and power to hire, promote, discipline and fire employees based on those behaviors and performance. Management is about efficiency and getting results though systems, processes, procedures, controls and structure.

What Is a Leader?

Perhaps the greatest separation between management and leadership is that leaders do not have to hold a management position. That is, a person can become a leader without a formal title. Any individual can become a leader because the basis of leadership is on the personal qualities of the leader. People are willing to follow the leader because of who he or she is and what the leader stands for, not because they have to due to the authority bestowed onto him or her by the organization. The leader will show passion and personal investment in the success of his or her followers reaching their goals, which may be different from organizational goals.

A person can become a leader without a formal title.

A leader has no formal, tangible power over their followers. Power is awarded to the leader on a temporary basis and is contingent upon the leader's ability to continue to motivate and inspire followership. Notice the shift in terminology here: managers have subordinates, while leaders have followers. Subordinates do not have a choice but to listen to the demands and wishes of their managers, but following is (and always will be) a voluntary choice for those who follow a leader. Those who no longer wish to follow the leader will simply stop. That is, if an employee initially sees his or her manager as a leader and eventually ceases to be inspired by that manager, the employee will still obey the manager, but only because the employee is required to do so, not because he or she wants to.

Leadership is about effectiveness through trust, inspiration and people. Leaders often challenge the status quo that managers spend much of their time upholding to bring innovation to organizations. Leadership is visionary, change-savvy, creative, agile and adaptive. Managers are concerned with the bottom line, while leaders spend time looking at the horizon.

The Manager versus the Leader

To better help you understand the differences between a manager and a leader, we can look to Erin Brockovich. Erin was a true leader in every sense of the word, and it was because of her leadership qualities that her name became well-known in 2000 when Hollywood chose Julia Roberts to play her role in the Oscar-winning movie Erin Brockovich. For those of you who did not see the movie or who have never heard of Erin Brockovich, here is some background information.

Erin Brockovich was a true leader in every sense of the word.

Erin was a typical single mother just trying to find her path in life when she was involved in a serious car accident and hired a man by the name of Ed Masry as her lawyer. This meeting would soon change Erin's life and the lives of countless others. After Ed and Erin settled her case, Erin was hired at Ed's law firm as a file clerk. One day, Erin found a set of medical records that would turn into the largest direct-action lawsuit in U.S. history to the tune of $333 million in damages, but getting there is where the story of leadership begins.

Once the medical records were found, it was Erin the file clerk, and not the lawyer, who pursued justice for what would turn out to be 600 individuals whose water had been poisoned by Pacific Gas & Electric for 30 years in Hinkley, California. Yet the lawyer was the manager, he was the one in the leadership position and he was the one with the experience, knowledge and power to bring Pacific Gas & Electric to justice, so why did he not take the lead on this case? Why was he was more occupied with cases that he knew he could make money on? Why was the lawyer reluctant to dig deeper into the medical records?

Julia Roberts portrayed Erin, who brought Pacific Gas and Electric to justice while working as a file clerk.

As I said earlier, not all managers are leaders, and not all leaders are managers. Even though Erin was just a file clerk, she spent countless hours, often at her own expense, going door-to-door showing compassion and support to the residents of Hinkley - listening to their stories, providing a sense of hope and showing unwavering tenacity to make sure that Pacific Gas & Electric would pay for what they did to the residents of Hinkley. Her vision and efforts organized a group of followers to take a stand against Pacific Gas & Electric. Erin's story shows that leadership is not something that comes with position, title, authority or power. Rather, it was Erin's values, dedication, compassion, persistence and her ability to motivate people to go against the odds that made her a true leader.

Lesson Summary

Let's review. A manager is a person in an organization who is responsible for carrying out the four functions of management, including planning, organizing, leading and controlling. A manager becomes a manager by virtue of his or her position, and subordinates will follow the manager because of his or her job description and title. A manager's primary concern is to accomplish organizational goals. Management is about efficiency and getting results through systems, processes, procedures, controls and structure.

A person can become a leader without a formal title. That is, any individual can become a leader because the basis of leadership is on personal qualities. A leader will show passion and personal investment in the success of his or her followers reaching their goals. People are willing to follow the leader because of who he or she is and what the leader stands for. A leader has followers, whereas a manager has subordinates. Power is awarded to the leader on a temporary basis and is contingent upon the leader's ability to continue to motivate and inspire followership. Leadership is about effectiveness through trust, inspiration and people. Leaders are visionary, change-savvy, creative, agile and adaptive.