Basic Issues in Leadership

Successful organizations require leadership. But what is leadership? What differentiates effective leaders from ineffective leaders? In this chapter and in chapter 15, we will review what we have come to learn about leadership and provide you with some specific guidelines for selecting and training leaders.

What is Leadership?

Few terms have stimulated as much debate about definition as leadership has. Everyone seems to agree about its importance. And experts generally agree that Bill Gates at Microsoft, Linda Wachner of Warnaco, Michael Eisner at Disney, and Richard Branson of the Virgin Group are effective leaders. But are leaders born or made? Do leaders have common personality characteristics? On questions such as these, there is little agreement.

A review finds that common to all definitions of leadership is the notion that leaders are individuals who, by their actions, facilitate the movement of a group of people toward a common or shared goal. This definition implies that leadership is an influence process.

The distinction between leader and leadership is important, but potentially confusing. The leader is the individual; leadership is the function or activity the individual performs. Do all leaders exercise leadership? It depends on what you mean by the term leader. The word leader is often used (interchangeably with the word manager) to describe those individuals in an organization who have positions of formal authority, regardless of how they actually act in those jobs. But just because someone is supposed to be a formal leader in an organization might not mean that he or she exercises leadership.

In fact, one of the most debated issues related to this topic is whether leadership is a different function and activity from management. Do some formal leaders exercise leadership while others exercise management? Arguably, the best analysis of this question has been provided by Harvard's John Kotter. He says that management is about coping with complexity. Good management brings about order and consistency by drawing up formal plans, designing organization structures, and monitoring results against the plans. Leadership, in contrast, is about coping with change. Leaders establish direction by developing a vision of the future; then they align people by communicating this vision and inspiring them to overcome hurdles. Kotter sees both strong leadership and strong management as necessary for optimum organizational effectiveness. But he believes that most organizations are underled and overmanaged. He claims we need to focus more on developing leadership in organizations because the people in charge today are too concerned with keeping things on time and on budget and with doing what was done yesterday, only doing it a little bit better.

In contrasting management and leadership, it may also help to think of the latter as involving the ability to inspire people. Management focuses on inanimate objects, whereas leadership focuses on raising human potential. Or, as the late Admiral Grace Murray Hopper put it, "You cannot manage men into battle. You manage things; you lead people."

So we have learned that formal leaders—those in positions of authority—may exhibit behaviors that we would call leadership, but not in every case. On the other hand, we often use the word leader to describe people in organizations who are exhibiting leadership, even though they don't hold formal leader positions. These people are