Peter Drucker not long before he died said something during an NPR interview that stuck with me. I don't remember the exact quote, but it was something like: "there is too much emphasis today put on leadership; what is needed today is more emphasis on management."

The remark struck me as odd because like most people, I thought the two concepts were basically interchangeable. Over the past 15 years, though, I've come to understand that while there are a few individuals who are good at both leading people and managing people, the two skills are wildly different and even, in a certain sense, opposites.

Leadership is about inspiring people, motivating them, and getting them to do more than they ever thought possible. Management is about delimiting responsibilities, measuring results and taking remedial action. Put another way, leadership is all "upward and onward" while management is all "carrot and stick."

In my experience, few entrepreneurs (or people in general) are good at both. It's difficult to simultaneously inspire people to greatness when, at some point, you'll eventually be giving them an annual review that might involve a 2 percent raise. The two situations basically cancel each other out.

Many organizations make a clear distinction between leadership and management. The U.K. government, for example, has a monarch who provides leadership and a Prime Minister who provides management. By contrast, the U.S. government expects the President to provide both, which some do much better than others.

The most effective engineering organization I ever encountered split management and leadership into separate functions. A chief architect had the vision of where the software needed to go and motivated people to achieve that vision. The engineers, however, reported to a manager chain, who handled salaries and administration.

By contrast, I've seen many organizations headed by 1) brilliant engineers who are indifferent (or even abysmal) managers and 2) brilliant managers who are horrible leaders, in that they understand numbers and basic psychology but lack the vision, scope, and technical expertise to motivate and inspire a team.

CEOs who aren't good managers do dumb things like yell at people when they don't immediately "get" whatever the leader is saying. To be effective, such CEOs need a level-headed Chief Operating Officer who cleans up the inevitable messes. Steve Jobs and Tim Cook were an excellent example of this kind of highly productive partnership.

Similarly, CEOs who aren't good leaders do dumb things like stick creatives in open plan offices because it saves on office space rental. To be effective, such CEOs need a Chief Engineering Officer who has the vision to guide the company into the future and bring everyone else along for the ride. John Carmack (inventor of ground-breaking computer game Doom) is an example of a CTO who partners well with his CEOs.

Obviously, most startups can't afford to split these two roles and often the founder must somehow provide both leadership and management. That being said, it's no accident that so many highly successful companies were founded by two, rather than one, individual. Examples here would be Bill Gates/Paul Allen, and Larry Page/Sergey Brin.

With this in mind, entrepreneurs should be honest with themselves about their natural talents and proclivities. Unless you're one of those unicorns who have both in equal measure, you should either find a co-founder who fills in your gaps or at least plan to hire somebody to fill in your gaps.

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Published on: Mar 3, 2020
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