by Paul Naybour, Business Development Director for Parallel Project Training
With so much at stake as a new startup, understanding the difference between being a manager and a leader is critical. After all, the numbers say getting it wrong can significantly impact your business.
It is reported that poor management can cost an organisation up to 7% of their annual sales. Great leaders can increase revenue by 1.5% and customer satisfaction by as much as 4%, and that’s a pretty big difference overall. There is also far more to consider than simply the potentially hefty financial costs involved when getting started in business. There is the well-being of the people you work for, your ability to attract and retain the best talent, how your clients, suppliers, and the public perceive your business, and lastly, how you feel about and sustain your business going forward.
With that in mind, we look at the differences between managers and leaders and what you can do to lead and be great at both because getting it together is better for everyone.
Manager vs Leader
Great managers can run systems well, yet this is often at the expense of the people that do the work and daily grind. A good leader will build the teams and people behind the systems and be able to empower and lead them to success. Therefore, it’s pretty evident that a startup is likely to need both skillsets to make an impact. Yet these skills aren’t often found within the same person. Of course, you can do both, but you may need help or at least some training or personal development when it comes to effectively managing and leading your business. If you hire someone to manage the systems, then use your leadership skills to inspire, motivate and drive the team’s performance in cohesion with the procedures. They can never be totally separated.
If you really struggle with communication, try reading books on understanding and communicating with people to bring out those potentially hidden leadership traits. If you find dealing with the people side of the business difficult, then you should make some time in the day to link up and plug in with the people on the ground. If you make yourself available to hear what they have to say, they will often guide your leadership skills.
To lead your business effectively, you should always understand and keep up to date on the key performance indicators, what they are up to and what the data means, and critically how it impacts your business. Natural leaders can struggle with data management and keeping the staff in order and on track, so you may need to hire assistance to run some administration and staff control. You must do more than simply be the business inspiration if you want a win-win formula. You should seek to motivate, lead, inspire and manage the people and processes equally, and when you really can’t, get the best help you can. However, you’ll need to manage and lead them effectively to ensure they remain at your side as your business grows.
Staff valuable to businesses have been known to go elsewhere due to poor management and leadership. In fact, according to author Brigette Hyacinth of Leading the Workforce of the Future, employees will join a company but leave a manager. She quotes figures as many as 75% voluntarily leaving a job to swerve a manager or immediate supervisor rather than the work or company itself.
Where does it fall short – poor leadership impact
There are plenty of issues caused by poor management and leadership. However, two major concerns to avoid include lack of direction and morale loss.
Lack of direction – if you can’t provide direction to a team, it can cause frustration on both sides when expectations aren’t clearly defined, goals aren’t clear, and progress is hard to measure. If you want to set your business up for the future, it’s vital that the entire team, including you, understand the pathways and share in both successes and failures. As the saying goes, ‘teamwork makes the dream work’ it doesn’t mean you have to be hands-on at everything, but your direction should be clear, and you need to surround yourself with people who can make it happen.
Loss of morale – It’s great to be a leader and have the ideas to drive your business forward, but the management skills you have or employ will turn those ideas into results. Managers and leaders bring about different feelings in the people working under them. Sometimes managers who carry out staff disciplinary actions and refocus teams to reach the finish line can be seen to be heavy handed. Good leadership skills may avoid disciplinary action becoming necessary, or, can help staff understand the need for remedial action that can achieve positive results. It’s great if you are a motivational leader with management skills as you can do the essential roles of both in an inspirational way giving you a head start in the ideation of those who work for you. If you are seen as a great leader, then those who admire you are more likely to help you achieve and work with you, not for you.
Effective leadership is increasingly important to grow a robust and well-rounded business with loyal and hardworking employees. There is much debate about whether a good manager is also a good leader, with many saying that the two roles require entirely different skill sets and focus to ensure continued success. Yet, as a startup, you are pretty likely to have to harness your inner leader and manager, at least in the early days. So, which comes naturally to you, and the one you feel has to come out on any given day will be driven not only by your business aims and goals but also by the workforce you choose. As a manager, it’s essential to get the work done, but sharing the vision and allowing the group latitude to accomplish and share responsibility will help your leadership. By learning to command and influence, explain and inspire, discipline and mentor, delegate authority not just tasks, you can make a start to combining the essential skills that see good managers and leaders.
Making the transition from manager to leader requires thoughtfulness as a huge part of managing and leading involves balancing the needs of the employees and the business. Listen and communicate, allow time for feedback, hear what is said, and show how and what you plan to do about it to ensure the teams feel engaged. The more you listen, the more you will hear and be heard. Get to know everyone’s strengths and weaknesses, use these for the greater good, seek feedback with regular meetings and performance reviews, and ensure that your feedback is constructive. Everyone feels they can celebrate success with you and willingly share responsibility for mistakes guiding the business forward. Work on earning respect if you want to get the best from any working relationship, be that as a manager and leader. Occasionally get your hands dirty, don’t forget your roots, respect what each team member brings to your business as a whole and you’re giving yourself the best basis for a successful startup.
Paul Naybour is the Business Development Director for Parallel Project Training. He is a well-known speaker on the Association for Project Management (APM) Network in the UK and a regular contributor to the APM blog. He is also one of the voices behind the popular series of APM podcasts. He has contributed insightful thought leadership articles to a range of publications for more than 10 years.