Leadership is different from management, but not for the reasons most people think.

Leadership isn’t mystical and mysterious. It has nothing to do with having “charisma” or other exotic
personality traits. It is not the province of a chosen few. Nor is leadership necessarily better than
management or a replacement for it.

Rather, leadership and management are two distinctive and complementary systems of action. Each
has its own function and characteristic activities. Both are necessary for success in an increasingly
complex and volatile business environment.

Most U.S. corporations today are over-managed and underled. They need to develop their capacity
to exercise leadership.

Successful corporations don’t wait for leaders to come along. They actively seek out people with
leadership potential and expose them to career experiences designed to develop that potential.
Indeed, with careful selection, nurturing, and encouragement, dozens of people can play important
leadership roles in a business organization.

But while improving their ability to lead, companies should remember that strong leadership with
weak management is no better, and is sometimes actually worse, than the reverse. The real
challenge is to combine strong leadership and strong management and use each to balance the
other.

Of course, not everyone can be good at both leading and managing. Some people have the capacity
to become excellent managers but not strong leaders. Others have great leadership potential but, for
a variety of reasons, have great difficulty becoming strong managers. Smart companies value both
kinds of people and work hard to make them a part of the team.

But when it comes to preparing people for executive jobs, such companies rightly ignore the recent
literature that says people cannot manage and lead. They try to develop leader-managers. Once
companies understand the fundamental difference between leadership and management, they can
begin to groom their top people to provide both.

The difference between management and leadership

Management is about coping with complexity. Its practices and procedures are largely a response to
one of the most significant developments of the 20th Century: the emergence of large organizations.
Without good management, complex enterprises tend to become chaotic in ways that threaten their
very existence.
Good management brings a degree of order and consistency to key dimensions like the quality and
profitability of products.

Leadership, by contrast, is about coping with change.

Part of the reason it has become so important in recent years is that the business world has become
more competitive and more volatile. Faster technological change, greater international competition,
the deregulation of markets, overcapacity in capital-intensive industries, an unstable oil cartel,
raiders with junk bonds, and the changing demographics of the workforce are among the many
factors that have contributed to this shift.

The net result is that doing what was done yesterday, or doing it 5 percent better, is no longer a
formula for success. Major changes are more and more necessary to survive and compete effectively
in this new environment. More change always demands more leadership.

Consider a simple military analogy: A peacetime army can usually survive with good administration
and management up and down the hierarchy, coupled with good leadership concentrated at the very
top. A wartime army, however, needs competent leadership at all levels. No one yet has figured out
how to manage people effectively into battle; they must be led.

These two different functions — coping with complexity and coping with change — shape the
characteristic activities of management and leadership. Each system of action involves deciding what
needs to be done, creating networks of people and relationships that can accomplish an agenda, and
then trying to ensure that those people actually do the job. But each accomplishes these three tasks
in different ways.

Companies manage complexity first by planning and budgeting — setting targets or goals for the
future (typically for the next month or year), establishing detailed steps for achieving those targets,
and then allocating resources to accomplish those plans.

By contrast, leading an organization to constructive change begins by setting a direction —

developing a vision of the future (often the distant future) along with strategies for producing the
changes needed to achieve that vision.

Management develops the capacity to achieve its plan by organizing and staffing — creating an
organizational structure and set of jobs for accomplishing plan requirements, staffing the jobs with
qualified individuals, communicating the plan to those people, delegating responsibility for carrying
out the plan, and devising systems to monitor implementation.

The equivalent leadership activity, however, is aligning people. This means communicating the new
direction to those who can create coalitions that understand the vision and are committed to its
achievement.

Finally, management ensures plan accomplishment by controlling and problem solving — monitoring
results versus the plan in some detail, both formally and informally, by means of reports, meetings,
and other tools; identifying deviations; and then planning and organizing to solve the problems.

But for leadership, achieving a vision requires motivating and inspiring — keeping people moving in
the right direction, despite major obstacles to change, by appealing to basic but often untapped
human needs, values, and emotions.

Leadership is different from management, but not for the reasons most people think.

Leadership isn’t mystical and mysterious. It has nothing to do with having “charisma” or other exotic
personality traits. It is not the province of a chosen few. Nor is leadership necessarily better than
management or a replacement for it.

Rather, leadership and management are two distinctive and complementary systems of action. Each
has its own function and characteristic activities. Both are necessary for success in an increasingly
complex and volatile business environment.

Most U.S. corporations today are over-managed and underled. They need to develop their capacity
to exercise leadership.

Successful corporations don’t wait for leaders to come along. They actively seek out people with
leadership potential and expose them to career experiences designed to develop that potential.
Indeed, with careful selection, nurturing, and encouragement, dozens of people can play important
leadership roles in a business organization.

But while improving their ability to lead, companies should remember that strong leadership with
weak management is no better, and is sometimes actually worse, than the reverse. The real
challenge is to combine strong leadership and strong management and use each to balance the
other.

Of course, not everyone can be good at both leading and managing. Some people have the capacity
to become excellent managers but not strong leaders. Others have great leadership potential but, for
a variety of reasons, have great difficulty becoming strong managers. Smart companies value both
kinds of people and work hard to make them a part of the team.

But when it comes to preparing people for executive jobs, such companies rightly ignore the recent
literature that says people cannot manage and lead. They try to develop leader-managers. Once
companies understand the fundamental difference between leadership and management, they can
begin to groom their top people to provide both.

The difference between management and leadership

Management is about coping with complexity. Its practices and procedures are largely a response to
one of the most significant developments of the 20th Century: the emergence of large organizations.
Without good management, complex enterprises tend to become chaotic in ways that threaten their
very existence.

Good management brings a degree of order and consistency to key dimensions like the quality and
profitability of products.

Leadership, by contrast, is about coping with change.

Part of the reason it has become so important in recent years is that the business world has become
more competitive and more volatile. Faster technological change, greater international competition,
the deregulation of markets, overcapacity in capital-intensive industries, an unstable oil cartel,
raiders with junk bonds, and the changing demographics of the workforce are among the many
factors that have contributed to this shift.

The net result is that doing what was done yesterday, or doing it 5 percent better, is no longer a
formula for success. Major changes are more and more necessary to survive and compete effectively
in this new environment. More change always demands more leadership.

Consider a simple military analogy: A peacetime army can usually survive with good administration
and management up and down the hierarchy, coupled with good leadership concentrated at the very
top. A wartime army, however, needs competent leadership at all levels. No one yet has figured out
how to manage people effectively into battle; they must be led.
These two different functions — coping with complexity and coping with change — shape the
characteristic activities of management and leadership. Each system of action involves deciding what
needs to be done, creating networks of people and relationships that can accomplish an agenda, and
then trying to ensure that those people actually do the job. But each accomplishes these three tasks
in different ways.

Companies manage complexity first by planning and budgeting — setting targets or goals for the
future (typically for the next month or year), establishing detailed steps for achieving those targets,
and then allocating resources to accomplish those plans.

By contrast, leading an organization to constructive change begins by setting a direction —

developing a vision of the future (often the distant future) along with strategies for producing the
changes needed to achieve that vision.

Management develops the capacity to achieve its plan by organizing and staffing — creating an
organizational structure and set of jobs for accomplishing plan requirements, staffing the jobs with
qualified individuals, communicating the plan to those people, delegating responsibility for carrying
out the plan, and devising systems to monitor implementation.

The equivalent leadership activity, however, is aligning people. This means communicating the new
direction to those who can create coalitions that understand the vision and are committed to its
achievement.

Finally, management ensures plan accomplishment by controlling and problem solving — monitoring
results versus the plan in some detail, both formally and informally, by means of reports, meetings,
and other tools; identifying deviations; and then planning and organizing to solve the problems.

But for leadership, achieving a vision requires motivating and inspiring — keeping people moving in
the right direction, despite major obstacles to change, by appealing to basic but often untapped
human needs, values, and emotions.
 01. What is the Article saying about leadership?

According Kotter (1990), leadership is not mythical or mysterious. Most of the developed
companies nowadays are trying to practice leadership in their day to day business activities
for their success. Most of them do not wait until leaders come for the organization. They use
to find leaders who within the company. According Kotter (1990), leadership and
management are two different factors, but one fact cannot function without the other factor.
Effective and efficient performances can be seen if the person have combine strong
leadership and strong management and use each to balance the other.

Leadership is about coping with change. With the changes in the business world, with the
increscent of this complexity, neediness of leadership is increasing to be a success. To
manage the complexity in the environment, leadership is practicing three actions. Such as,

1. Set a direction

Develop a vision for the future and decide the needed strategies which needed to achieve the
defined vision.

2. Align people

Communicate new direction to the people in the team who are capable enough to understand
the vision of the team and are able to give commitment to achieve the vision defined.

3. Motivating and inspiring

Keep people move in the corrective direction as defined in the very first stage, despite the
major obstacles for the change, by appealing to basic but often untapped human needs,
values, and emotions.

02. What is he saying about difference between leadership and management?

According Kotter (1990), leadership and management are two different factors, but one fact
cannot function without the other factor. Each of his has its own functions and characteristic
activities. Some of them are,

1. Management is about coping with complexity. Leadership, by contrast, is about coping with
change.
 With the emergent of large complex organizations, management brings key dimensions such
as quality and profitability of the products and services a consistency and a degree of order.
Leadership basically with the changes in the business word, the more it gets complex, the
more leadership is needed. For an example, in a peaceful time an army can survive with a
hierarchy that have good administration and management from top to bottom and good
leadership at the top level of the organization structure. But when there is a war, leadership is
wanted at all the levels of the hierarchy for survive.

2. Managing complexity in the environment

Leadership and management the both are doing the same actions which are,

· Decide what to be done

· Create networks of people and relationships to achieve goals and objectives

· Ensure that people do their job effectively

But each achieve above three actions in different ways.

· Decide what to be done

Management first does the planning and budgeting which includes setting goals and
objectives, setting milestones and steps with details and allocates resources and capabilities to
accomplish the set goals and objectives. But the leaders with the change of the organization,
leaders first set a direction by developing a vision for the future and decide the needed
strategies which needed to achieve the defined vision.

· Create networks of people and relationships to achieve goals and objectives

Management does organizing and staffing. They use to create organization structures, set of
jobs with roles and responsibilities to achieve the defined goals and objectives, staffing
qualified skilled people for that job roles, communication them about the plan, delegating
roles and responsibilities and also devising systems to monitor implementation. But in
leadership, they use to align people, which involve communicating new direction to the
people in the team who are capable enough to understand the vision of the team and are able
to give commitment to achieve the vision defined.
· Ensure that people do their job effectively

Management practices the controlling and problem solving at the final stage. They use to
monitor the results by comparing to the plan via having meetings, checking reports and using
other tools, identifying the deviation and the gaps, and planning and re-organizing to solve
these problems. But in leadership, they practices motivating and inspiring at this stage. They
use to keep people move in the corrective direction as defined in the very first stage, despite
the major obstacles for the change, by appealing to basic but often untapped human needs,
values, and emotions.

03. What does each of the case studies highlight?

· Lou Gerstner at American Express

Basically in this case study, it is discussing how the Lou Gerstner who president as the Travel
Related Services (TRS) arm at American Express, practice main three leadership actions in
the company in order to face for the challenging business environment.
First Gerstner and his team asked many fundamental questions from the people who are
running the card business on the company market, economic, competition and etc. to get a
vast knowledge about the situation. And then first he has set a vision for Travel Related
Services (TRS) arm at American Express, which is one of the main actions of leadership.

After that Gerstner has hired and trained people to operate the business who will thrive in it,
and also he has communicated them the overall direction. This can be identified as the second
action of leadership, which is aligning the people.

After that while the process is going on Gerstner and the top managers rewarded the risk
taking employees and “Great Performers program” to recognize and reward truly exceptional
customer service, a central tenet in the organization’s vision, to motivate them on what they
are doing. And also to make entrepreneurship easier among the team members, they
discouraged unnecessary bureaucracy. Also he has upgraded hiring standards and created the
TRS Graduate Management Program, which offered high-potential young people special
training, an enriched set of experiences and an unusual degree of exposure to people in top
management. In which all the mentioned processes can be categorized under the third main
action in leadership which is Motivating and inspiring the team.

· Chuck Trowbridge and Bob Crandall at Eastman Kodak

 Basically in this case study, it is discussed on how Chuck Trowbridge and Bob Crandall align
people in the organization to face for the challenges in an effective and efficient manner to
achieve company set goals and objectives.
First Chuck Trowbridge has discussed with each and every key person inside the group and
people elsewhere at Kodak who are much important to operate the business activities to
understand about the current situation in order to solve the problem. As the main crucial area
was engineering and manufacturing organization, Trowbridge has joined with Bob Crandall
who is the head of that organization in Kodak. First both of them together have set a vision
“To become a world-class manufacturing operation and to create a less bureaucratic and more
decentralized organization”. This can be identified as setting direction the first action of
leadership.

As the message of the vision is difficult to convey because it was such a radical departure
from previous communications, Crandall set up dozens of vehicles to emphasize the new
direction and align people to it. And also he has implement,

1. Weekly meetings with his own 12 direct reports

2. Monthly “copy product forums” in which a different employee from each of his department
would meet with him as a group to discuss on recent improvements and new projects to
achieve still better results.

3. Quarterly “State of the Department” meetings where his managers met with everybody
in their own departments.

4. Once a month, Crandall and all those who reported to him also meet with 80 to 100 people
from some area of his organization to discuss anything they wanted.

5. To align his biggest supplier–the Kodak Apparatus Division, this supplied one-third of the
parts used in design and manufacturing–he and his managers met with the top management of
that group over lunch every Thursday.

6. Created a format called “business meetings,” where his managers meet with 12 to 20 people
on a specific topic, such as inventory or master scheduling.

7. Trowbridge and Crandall also enlisted written communication in their cause. A four- to
eight-page “Copy Products Journal” was sent to employees once a month.

8. Program called “Dialog Letters” gave employees the opportunity to anonymously ask
questions of Crandall and his top managers and be guaranteed a reply.

9. In a main hallway near the cafeteria, these huge charts vividly reported the quality, cost, and
delivery results for each product, measured against difficult targets. A hundred smaller
 versions of these charts were scattered throughout the manufacturing area, reporting quality
levels and costs for specific work groups.

Throughout this mass project what Trowbridge and Crandall were trying to do is
Communicate new direction to the people in the team who are capable enough to understand
the vision of the team and are able to give commitment to achieve the vision defined which
is aligning the people.

· Richard Nicolosi at Procter & Gamble

By considering the case study is mainly discussing on setting direction, aligning the people
and Motivating and inspiring the team to overcome the challenges in today the company is
facing. Though there is a vision in the company Nicolosi has introduced that vision with a
new direction included a much greater stress on teamwork and multiple leadership roles.
Nicolosi has appointed a group groups to manage the division and its specific products as a
strategy. And also he has established “category teams” to manage their major brand groups
(like diapers, tissues, towels) and started pushing responsibility down to these teams. This is,
delegating the power among the employees of the company which can be identified
as aligning the people which is the second main action in the leadership.

Nicolosi has selectively discussed with advertising agency and got to know key creative
people and talked more to the people who were working on new product development
projects, which set the employees much motivated as the general manager deal with even
lower level employees. And also Nicolosi asked the marketing manager of diapers to report
directly to him, eliminating a layer in the hierarchy which motives the employees. This
process can be identified as motivating and inspiring the team.

After getting more information from the employees Nicolosi has announced a new
organizational structure that included not only category teams but also new-brand business
teams, this can be identified as delegating the roles and responsibilities among the employees
which is aligning the people.

Also On June 4, 1985, with the gathering of sales district managers and paper plant
managers– several thousand people in all in local Masonic Temple, Nicolosi and other board
members described their vision of an organization where “each of us is a leader” which
motives the employees of the company. And also the event was videotaped, and an edited
version was sent to all sales offices and plants for everyone to see which can be analyzed as
setting the direction (make aware the each and every person on what is the company vision
is).

Also in spring of 1986, as few of division’s secretaries, feeling empowered by the new
culture, developed a secretary’s network and established subcommittees on training, on
rewards and recognition, and on the “secretary of the future”, it let the employees felt
motivated and give their maximum commitment towards the company goal achieving.

All above mentioned activities helped create an entrepreneurial environment where large
numbers of people were motivated to realize the new vision. This can be identified
as motivating and inspiring the team which is the third main action of leadership.

04. What could those business leaders do to improve those things today?
All the leaders must be much more in touch with the technology as in today most of our day
to day activities are linked with the digital. We call today as a digital world. In order to
become more successive effective and efficient leader, he or she must be align with the
digital world and the changes in it.