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Leadership vs. management

- Joe Benesh is a senior architect with Shive-Hattery and president + CEO of the Ingenuity Company, a strategic planning, diagramming, framework development, and design thinking consulting firm.

Within the host of elements that make up an internal business culture, there is a delicate balance between how a business is led and how it is executed. There are four elements that are our focus here: we will discuss the differences between leadership and management, and how adjustments in the levels of control and accountability can feed into performance outcomes.

Our first lever arm is balanced between leadership and management. In a general sense, businesses tend to focus on management. There are a number of reasons for this: 1) Metrics are easier to establish, as they tend to be analytical and based on established benchmarks. 2) There is less risk associated with management – generally, it is the improvement or monitoring of established processes. 3) There is often no pressure to push individuals out of their comfort zones – in many ways, management is about creating conformity or adherence to the pre-established norms.

Leadership is rooted in something different. It isn’t always about change, but the purpose of leadership is to create, rather than maintain. There is a higher level of risk involved, but the outcomes are rooted in: 1) Greater organizational sustainability. 2) Higher employee engagement and investment in organizational mission. 3) Ability to positively adapt to changes in market segments.

As the balance between leadership and management is established, there are two internal elements that act as subsets of each. Control and accountability. These factors are complex and many organizations struggle to find the right levels of each. As a function of human nature, there tends to be a decrease in accountability as control is increased beyond a certain threshold. Similarly, if control is relaxed (up to a certain point), the level of accountability and employee productivity increases substantially. There are obviously extremes on both ends, but there is a range in the middle where these two factors can reach an optimized level.

In an aspirational sense, many organizations seek to self-actualize as leadership / accountable type organizations. But as risk increases, there is a tendency to gravitate back toward the safer, more cautious framework of management and control. But that’s why finding the right balance is important and to acknowledge that these two things are not the same and should not be used interchangeably.

IBM and companies like Tesla are two examples of one extreme and the other. IBM stood as an example of exceptional management for the better part of a century. However, by 1991, the strict adherence to the status quo – managing existing systems without modernizing or adapting to current market conditions – almost caused the company's complete collapse. Company officials chose to be almost exclusively devoted to management and control; low risk, which led to a contraction that was completely avoidable. Apple_welcome-ibm-seriously1

Tesla is just the opposite. As a company, Tesla is built around a singular idea – that they will lead the market by providing a product that will eventually replace the status quo. They chose to lead and that leadership instills a sense of accountability in their employees – there is a social obligation as well as the business one. There is high risk here, as it still remains to be seen if Tesla will be sustainable in the long run.

I've included an image in this blog from an ad that Apple ran to welcome IBM to the PC market, one that they should have, by all measures, been able to dominate. It serves to underscore how damaging an adherence to the status quo can be.

Leadership and management are two different things, but they are both essential to creating a successful organization. In the right doses, control and accountability are also critical elements of success. The key is to find the right recipe of each to produce the desired results and build upon your successes as an organization.

 For more information:Joe _Benesh_2011

 Contact: joe@ingenuitycompany.com

 Please follow: @ingenuitycmpny

 

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