Management and leadership have nothing in common. Leadership has been around since the dawn of man, but management was lifted from middle age military models and replicated in business on a grand scale in the Factory System of the 1800s. Leadership is essential; management is toxic to everyone around it.

The Core Assumption of Management

In business, management coalesced around Frederick Winslow Taylor's assumption in the late 1800s that most people are "stupid and lazy". If you want to get them to work, you find the few smart and motivated ones and lord them over the stupid and lazy ones, and thus, management was born. It's a ludicrous and desperate solution to a problem that doesn't exist.

We believe around 81% of the working population will work smart and motivated if allowed or required. Which brings us to why the very idea of management is so bankrupt.

All management is built around figuring out how to keep those few people from being stupid and lazy. Leadership is radically different. It is built around figuring out how to serve and support the overwhelming majority of smart and motivated people.

LCD vs HCD - Do You Manage by Policy or Lead by Principle?

Management is built on polices, leadership is built on principles and values. Management asks, "What is the stupidest and laziest thing someone could do around here, and how do we make sure that doesn't happen again?" Then they create a policy that drags all the smart and motivated people to the bottom in a futile attempt to get the few lazy ones to work better. We call that Lowest Common Denominator (LCD) Management. All management is LCD.

A few years ago when Marissa Mayer at Yahoo found that some people who worked remote were not logging in enough (whatever that means), she created a new policy - everyone working remote would now have to come back to work in the Office Day Care Center and be "supervised".This is classic management, with no leadership in it at all.

Management Always Drags Everyone to the Bottom - LCD

Managers always take the easy route - create a policy and blanket (smother) everyone with it. You don't have to have any difficult conversations with anybody. But at what price? What message was sent to the overwhelming number of remote staff who were acting like adults and working even more productively than they ever could in the Office Day Care Center? Simple - it doesn't pay to be a smart and motivated adult at Yahoo, we'll still get dragged to the bottom with stupid policies built to ignore us and cater to the lazy.

Leadership Always Pulls Everyone to the TOP - HCD

A leader would have handled that very differently. They would have investigated why people weren't logging on enough (maybe they work offline first), and then had difficult conversations with the few who weren't performing well. And the leader would have held up those working well from remote as models to be emulated. The few lazy ones would be pulled to the top with the adults, or they would have been pushed out. Instead we got a classic top-down management solution that drags everybody to the bottom.

Highest Common Denominator (HCD) Leadership always pulls everyone to the top, or moves them along. Jack Dorsey says he is, "responsible for constantly raising the bar", but adds that if he is making decisions, he is not leading. He raises the bar and smart and motivated people show up to make decisions, including dealing with the few who don't want to play at the highest levels. All leadership is HCD; built to reward being motivated, not punish being lazy (and drag everyone to the bottom).

LCD (3-8) or HCD (8-10) - You Get To Choose

On a scale of one to ten, great company leaders function from eight to ten. "Eight is great" and anything less is below the bar. Managed companies (the majority) function from 3-8. They will put up with a three for a year before firing them, "five is fine", and eight is that exceptional, self-motivated freak they wish they had more of. What they don't realize is that eighty plus percent of their staff would function at eight or better if they just stopped creating blanket policies and treating them like they are stupid and lazy.

In 2013, Survey.com found that fifteen of the twenty reasons someone will leave your company, fully 75% of them, are directly related to managers. Douglas McGregor wrote a book that explained that in 1960, called The Human Side of Enterprise. He postulated Theory X (people are generally stupid and lazy), and Theory Y (people are generally smart and motivated), and then went on to show many examples of companies that had made both of these into self-fulfilling prophecies.

If you create policies and treat people like they are stupid and lazy, you will drag them all to the bottom. If you embrace a few principles and lead from those, you will reward the 80+% of smart and motivated among you, and force the few lazy ones to either step or, or step out.

Great Companies Are Built On HCD Leaders

How does a company like Pivotal Labs with 2,000 staff or W. L. Gore with 10,000 people function without a single manager in either place? It's because people at these companies and many more, are leading from principles that require everyone to be an eight, nine, or ten at work, and what a surprise, everyone steps up. No Office Day Care Center at these places - they are fully staffed with self-motivated, self-managed adults

LCD Management manages by policy. HCD Leadership leads by principle. LCD Management's policies create the threat, "I can fire you", where HCD Leadership's principles shout, "I can inspire you."

51% of everyone at work has their resume out and are actively looking for another job right now. Are they looking to run toward you because you are HCD Leaders or away from you because you are LCD Managers?

Theory X (LCD Management). Theory Y (HCD Leadership). You choose, and by that choice, you create your own self-fulfilling prophecy.

Published on: Aug 22, 2017