Why small business owners should focus on management not leadership

Steve Jobs and Bill Gates are the two people that many business owners aspire to be: leaders with incredible vision who built empires through their powerful leadership.

But behind leadership lies vital management skills. Whilst Jobs was envisioning the iPhone, Steve Wozinak was building Apple. While Bill Gates imagined a PC on every desk, Paul Allen was building Microsoft. Next to these great leaders was an equally great manager, and that’s really important.

However, leadership and management are not in competition. One is not better or more important than the other. Each has its own required functions and roles and both are essential for the success of the venture.

As the business owner, many of us must fit the shoes of both leader and manager. Therefore, it’s critical to make a distinction between your roles, and be aware of what you’re doing and how you’re going to do it.

Here are three essential business functions, and how the role of leader and manager should differ for each one.

  1. Deciding what needs to be done:

  • Leader – sets the direction of the business and develops the vision of the future.
  • Manager – sets targets, creates plans and allocates resources to achieving that future vision.
  1. Creating networks of people who can accomplish this vision

  • Leader – aligns people and communicates the direction to the key personnel who create leverage and move the vision in the right direction.
  • Manager – creates the organisational structure, including a set of roles that will be required to achieve the goals.
  1. Ensuring people actually do their job

  • Leader – Motivates and inspires people by tapping into emotions to get them moving in the right direction and excited about the journey.
  • Manager – Controls problems and turns their solutions into systems, as well as monitoring the plan, indentifying deviations and making corrections where necessary.

Leadership is overrated in SMEs

If you have leadership in an organisation with ineffective management, it could be much more disastrous than the other way round. In an SME, the management side of things is actually the more critical part of running the business. Most large corporations are over-managed and under-led. Managers will sit at various levels of the company, monitoring employees but not necessarily, re-energizing and inspiring them. Or promoting the company’s purpose and culture.

Most SMEs, however, are undermanaged and over-led. SME business owners are inspired, excited entrepreneurs who overflow with passion and ambition. The leadership comes naturally and people are automatically inspired. But as a leader, if you are undermanaging your employees you could end up with a team who are really excited to be working with you, but unable to deliver your vision. This is because they need systems to deliver it; systems devised by their manager. And that manager is you.

So every now and then, stop and look at your feet. Whose shoes are you wearing? Are you the manager or leader at the moment, and are your actions right for your current role? And when did you last change your shoes?



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