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CHAPTER 1: WHAT DOES IT MEAN TO BE A LEADER? 15

Exhibit 1.3 Comparing Management and Leadership

Management Leadership
Direction: Planning and budgeting Creating vision and strategy
Keeping eye on bottom line Keeping eye on horizon

Alignment: Organizing and staffing Creating shared culture and values
Directing and controlling Helping others grow
Creating boundaries Reducing boundaries

Relationships: Focusing on objects—producing/ Focusing on people—inspiring
selling goods and services and motivating followers
Based on position power Based on personal power
Acting as boss Acting as coach, facilitator, servant

Personal Qualities: Emotional distance Emotional connections (Heart)
Expert mind Open mind (Mindfulness)
Talking Listening (Communication)
Conformity Nonconformity (Courage)
Insight into organization Insight into self (Character)

Outcomes: Maintains stability; creates Creates change and a culture of
culture of efficiency integrity

managers and leaders are not inherently different types of people, and many man-
agers already possess the abilities and qualities needed to be good leaders. Both
management and leadership are essential in organizations and must be integrated
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effectively to lead to high performance. That is, leadership cannot replace
management; it should be in addition to management.
At Aetna, CEO Ronald A. Williams has used an integrated Action Memo
management and leadership approach to rescue the nation’s largest You can evaluate your own leadership
health insurance provider from a steep decline. Williams clearly potential by completing the quiz in Leader’s
practices good management, such as controlling costs, implement- Self-Insight 1.2 on page 16.
ing operational changes and new technologies, establishing goals
and plans, and monitoring performance. However, he is also a con-
summate leader who creates a culture that allows others to fl our-
ish, builds an environment that fosters integrity and accountability, and provides
vision and inspiration for employees. “People will walk through walls for him,”
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said one health care industry observer. There are managers at all hierarchical
levels in today’s organizations who are also good leaders, and most people can
develop the qualities needed for effective leadership.

Exhibit 1.3 compares management to leadership in five areas crucial to orga-
nizational performance—providing direction, aligning followers, building relation-
ships, developing personal qualities, and creating leader outcomes. 34

Providing Direction
Both leaders and managers are concerned with providing direction for the organiza-
tion, but there are differences. Management focuses on establishing detailed plans and