Listen to how most people talk in everyday conversation, and you'll find that they often use the words "management" and "leadership" interchangeably.
If they do make a distinction in meaning, it is usually in reference to levels in a hierarchy. People at the very top provide "leadership" -- whatever that is -- or at least they are supposed to. People in the middle do the "management," again with little clarity about what that means. This way of thinking is inaccurate and increasingly troublesome.
The Invention of Management
Management is a set of well-known processes that help organizations produce reliable, efficient, and predictable results. Really good management helps us do well what we more or less know how to do regardless of the size, complexity, or geographic reach of an enterprise.
These processes include planning, budgeting, structuring jobs, staffing jobs, giving people time-tested policies and procedures to guide their actions, measuring their results, and problem solving when results do not fit the plan.
Management as we know it today is almost entirely a later-twentieth-century invention. Although it has roots that go back centuries (as in running the Roman Empire), what we see today is a very modern phenomenon.
Why Management Has Mushroomed
Management now requires great skill. And both what it is and what it can achieve would have been difficult for even a well-educated person in the year 1900 to fully grasp.
Our sophisticated modern-day management processes did not exist in or prior to the nineteenth century because they simply weren't needed. After the Civil War in the United States, for example, there were only a few hundred organizations with over a hundred employees.
Today the number of US organizations with over a hundred employees is well over a hundred thousand. In the year 1900, the number of firms that did business around the world, on all continents, was very close to zero.
Today the number is so large it is hard to calculate.
Without competent management, the organizations that we have created in the last century, and that we continue to create today, could not function. Without management, chaos would reign. Enterprises would fall apart and go out of business quickly.
Management is an incredibly important invention, yet the average person -- even the average manager -- has no real appreciation of what a marvel it is.
But management is not leadership.
What is Leadership
Leadership is about setting a direction. It's about creating a vision, empowering and inspiring people to want to achieve the vision, and enabling them to do so with energy and speed through an effective strategy. In its most basic sense, leadership is about mobilizing a group of people to jump into a better future.
Today you can find all sorts of people in all sorts of situations helping to provide at least some degree of leadership. A project engineer might take some initiative. Because of his or her leadership, a small group of people is mobilized to find and execute something new, creating results which others in the organization would have thought nearly impossible.
You can find leadership coming from people who are officially called middle managers. And, conversely, you can sometimes find very little leadership in the actions of those near the top of a hierarchy.
More than anything, both today and throughout history, leadership has been associated with change. It's not about mobilizing a group to act the same way they have always acted. It has to do with changing people and their organizations so they can leap into a different and better future, no matter the threats or barriers or shifting circumstances.
In businesses today, leadership is the central force mobilizing people to create something that did not previously exist. That is, leadership creates an enterprise in the first place. And leadership takes existing enterprises and finds new opportunities, makes changes to capitalize on those opportunities, and moves firms into a future where they can grow and prosper.
Without sufficient leadership in a rapidly changing world, organizations become static and eventually fail.
And by sufficient leadership, in organizations of any size, I do not mean a grand CEO or executive committee. There is no way that a single figure or a small team at the top of the hierarchy can provide all the leadership that is needed. A superman or -- woman -- even one supervising an exceptional group of managers, who in turn supervise highly talented individual contributors -- can no longer do the job.
So which is more important? Management or leadership?
To begin to answer that question, we need to look again at what role each plays.
Management ensures the stability and efficiency necessary to run today's enterprise reliably. Leadership creates needed change to take advantage of new opportunities, to avoid serious threats, and to create and execute new strategies.
The point is that management and leadership are very different, and when organizations are of any size and exist in environments which are volatile, both are essential to helping them win.
Reprinted by permission of Harvard Business Review Press. Excerpted from Accelerate: Building Strategic Agility for a Faster-Moving World. Copyright 2014 John P. Kotter. All rights reserved.
John P. Kotter is a New York Times best-selling author, award-winning business and management thought leader, business entrepreneur, inspirational speaker, and Harvard professor.
Professor Kotter became a member of the Harvard Business School faculty in 1972. By 1980, at the age of 33, he was given tenure and a full professorship -- the youngest person ever to have received that award at the Business School.
Dr. Kotter has authored nineteen books to date -- twelve of them best sellers. Arguably his most popular book, Our Iceberg Is Melting, was published in 2006. This New York Times best seller introduced a broad audience to the eight-step philosophy behind Kotter International. Other widely read books include A Sense of Urgency, The Heart of Change, and Leading Change, which Time magazine selected in 2011 as one of the twenty-five most influential business management books ever written.
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