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List of Partners vendors. Leadership in business is the capacity of a company's management to set and achieve challenging goals, take fast and decisive action when needed, outperform the competition, and inspire others to perform at the highest level they can. It can be difficult to place a value on leadership or other qualitative aspects of a company, versus quantitative metrics that are commonly tracked and much easier to compare between companies.
Leadership can also speak to a more holistic approach, as in the tone a company's management sets or the culture of the company that management establishes. Individuals with strong leadership skills in the business world often rise to executive positions such as CEO chief executive officer , COO chief operating officer , CFO chief financial officer , president, and chair.
Leadership provides direction for a company and its workers. Employees need to know the direction in which the company is headed and who to follow to reach the destination. Leadership involves showing workers how to effectively perform their responsibilities and regularly supervising the completion of their tasks. Leadership is also about setting a positive example for staff to follow, by being excited about the work, being motivated to learn new things, and helping out as needed in both individual and team activities.
Leadership involves setting and achieving goals, taking action, and beating the competition, but it also relates to the tone of the company's management and what kind of culture is built for the employees.
Effective leadership includes exhibiting a strong character. Leaders exhibit honesty, integrity, trustworthiness, and ethics. Strong leadership involves clear communication skills. Leaders speak with and listen to staff members, respond to questions and concerns, and are empathetic. No one can doubt that such forms of motivation are effective within limits. But no one can doubt the weaknesses of such simple techniques. Human beings are not machines with a single set of push buttons. When their complex responses to love, prestige, independence, achievement, and group membership are unrecognized on the job, they perform at best as automata who bring far less than their maximum efficiency to the task, and at worst as rebellious slaves who consciously or unconsciously sabotage the activities they are supposed to be furthering.
The military undeniably has special problems. Because men get killed and have to be replaced, there are important reasons for treating them uniformly and mechanically. Clarity about duties and responsibilities, as maximized by the autocratic chain of command, is not only essential to warfare but has undoubted importance for most group enterprises. In fact, any departure from an essentially military type of leadership is still considered in some circles a form of anarchy.
But it is dangerous to confuse the chain of command or table of organization with a method of getting things done. It is instead comparable to the diagram of a football play which shows a general plan and how each individual contributes to it.
The diagram is not leadership. By itself it has no bearing one way or another on how well executed the play will be. Yet that very question of effective execution is the problem of leadership. Rewards and threats may help each player to carry out his assignment, but in the long run if success is to be continuing and if morale is to survive, each player must not only fully understand his part and its relation to the group effort; he must also want to carry it out.
The problem of every leader is to create these wants and to find ways to channel existing wants into effective cooperation. When the leader succeeds, it will be because he has learned two basic lessons: Men are complex, and men are different. Human beings respond not only to the traditional carrot and stick used by the driver of a donkey but also to ambition, patriotism, love of the good and the beautiful, boredom, self-doubt, and many more dimensions and patterns of thought and feeling that make them men.
But the strength and importance of these interests are not the same for every worker, nor is the degree to which they can be satisfied in his job. For example:. And in the last analysis an ideal organization should have workers at every level reporting to someone whose dominion is small enough to enable him to know as human beings those who report to him.
Fortunately, the prime motives of people who live in the same culture are often very much alike, and there are some general motivational rules that work very well indeed. All of us have known unselfish people who earnestly wished to satisfy the needs of their fellows but who were nevertheless completely inept as executives or perhaps even as friends or as husbands , because it never occurred to them that others had tastes or emotional requirements different from their own.
The one who leads us effectively must seem to understand our goals and purposes. He must seem to be in a position to satisfy them; he must seem to understand the implications of his own actions; he must seem to be consistent and clear in his decisions. If we do not apprehend the would-be leader as one who has these traits, it will make no difference how able he may really be.
We will still not follow his lead. If, on the other hand, we have been fooled and he merely seems to have these qualities, we will still follow him until we discover our error. In other words, it is the impression he makes at any one time that will determine the influence he has on his followers.
For followers to recognize their leader as he really is may be as difficult as it is for him to understand them completely. Some of the worst difficulties in relationships between superiors and subordinates come from misperceiving reality. So much of what we understand in the world around us is colored by the conceptions and prejudices we start with.
My view of my employer or superior may be so colored by expectations based on the behavior of other bosses that facts may not appear in the same way to him and to me. Many failures of leadership can be traced to oversimplified misperceptions on the part of the worker or to failures of the superior to recognize the context or frame of reference within which his actions will be understood by the subordinate. A couple of examples of psychological demonstrations from the work of S.
Asch 1 will illustrate this point:. An ideal organization should have workers at every level reporting to someone whose dominion is small enough to enable him to know as human beings those who report to him. In business, a worker may perceive an offer of increased authority as a dangerous removal from the safety of assured, though gradual, promotion.
A change in channels of authority or reporting, no matter how valuable in increasing efficiency, may be thought of as a personal challenge or affront. An invitation to discuss company policy may be perceived as an elaborate trap to entice one into admitting heretical or disloyal views. A new fringe benefit may be regarded as an excuse not to pay higher salaries. And so on. Too often, the superior is entirely unprepared for these interpretations, and they seem to him stupid, dishonest, or perverse—or all three.
But the successful leader will have been prepared for such responses. The other side of the same situation is as bad. The habit of acting like a boss can be destructive, too. For instance, much resistance to modern concepts of industrial relations comes from employers who think such ideas pose too great a threat to the long-established picture of themselves as business autocrats.
Their image makes progress in labor relations difficult. But another and still more subtle factor may intervene between employer and employee—a factor that will be recognized and dealt with by successful industrial leaders.
That factor is the psychological difficulty of being a subordinate. It is not easy to be a subordinate. If I take orders from another, it limits the scope of my independent decision and judgment; certain areas are established within which I do what he wishes instead of what I wish. To accept such a role without friction or rebellion, I must find in it a reflection of some form of order that goes beyond my own personal situation i.
These two possibilities lead to different practical consequences. For one thing, it is harder to take orders from one whom I do not consider in some sense superior.
It is true that one of the saddest failures in practical leadership may be the executive who tries so hard to be one of the boys that he destroys any vestige of awe that his workers might have had for him, with the consequence that they begin to see him as a man like themselves and to wonder why they should take orders from him. An understanding leader will not let his workers think that he considers them inferiors, but he may be wise to maintain a kind of psychological distance that permits them to accept his authority without resentment.
When one of two people is in a superior position and must make final decisions, he can hardly avoid frustrating the aims of the subordinate, at least on occasion. And frustration seems to lead to aggression. That is, thwarting brings out a natural tendency to fight back. It does not take much thwarting to build up a habit of being ready to attack or defend oneself when dealing with the boss.
Therefore, while leadership isn't intrinsically linked to profit, those who are viewed as effective leaders in corporate contexts are the ones who increase their company's bottom line. If an individual in a leadership role does not meet profit expectations set by boards, higher management, or shareholders, they may be terminated.
While there are people who seem to be naturally endowed with more leadership abilities than others, anyone can learn to become a leader by improving particular skills. History is full of people who, while having no previous leadership experience, have stepped to the fore in crises and persuaded others to follow their suggested course of action.
They possessed traits and qualities that helped them to step into roles of leadership. The terms leadership and management tend to be used interchangeably, but they're not the same. Leadership requires traits that extend beyond management duties. Both leaders and managers have to manage the resources at their disposal, but true leadership requires more. For example, managers may or may not be described as inspiring by the people working under them, but a leader must inspire those who follow them.
The concepts mentioned here are generalities and don't address every type of leader or manager. Many managers are leaders and vice versa—but not all are. Another difference between leaders and managers is that leaders emphasize innovation above all else. Whereas a manager seeks to inspire their team to meet goals while following company rules, a leader may be more concerned with setting and achieving lofty goals—even at the expense of existing corporate structures.
When a worker has a radical new idea for how to tackle an issue, a leader is likely to encourage that person to pursue the idea. Managers may be more likely to preserve existing structures because they themselves operate within that structure. They may have bosses above them, so they have less freedom to break rules in the pursuit of lofty goals. Leaders, on the other hand, often operate fairly independently.
That allows them to tolerate a greater amount of chaos, so long as they believe it will be worth it in the end. However, the leader's devotion to innovation can sometimes come at a cost.
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