Are Leaders or Managers More Valuable in Escaping an Economic Downturn?

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 As we continue to live through the worst economic downturn in years, the question is raised: Do we need more leaders or more managers in order to push ourselves out of this weak and fragile economy?

It is important to distinguish between and leader and a manager and what each role brings to the table. In the article, “What Leaders Really Do”, John P. Kotter states, “most US corporations today are overmanaged and underled”.2  The leadership role requires having a long-range perspective and keeping one’s eyes on the horizon.4 Furthermore, a strong leader challenges the status quo and inspires and motivates others within the company to think outside the box.4 Kotter states that leadership is about coping with change and with more change demands more leadership.2 Kotter describes the leadership role best when he uses the analogy of a peacetime vs. wartime army when stating, “a peacetime army can usually survive with good administration and management up and down the hierarchy, coupled with good leadership concentrated at the very top. A wartime army, however, needs competent leadership at all levels. No one yet has figured out how to manage people effectively into battle, they must be led”. 2

If a leader serves as an architect, than a manager serves as a competent contractor that understands the architect’s vision and points out flaws in the design if necessary.1 Managers need to plan, organize, problem solve and coordinate to get the job done, while simultaneously, serving as a role model to others.1 If a leader proposes a plan, a manager will need to understand the logistics behind getting the plan executed successfully, on time and on budget. Kotter points out that strong leadership with weak management is no better than strong management and weak leadership.2 He states that, “without good management, complex enterprises tend to become chaotic in ways that threaten their very existence. Good management brings degrees of order and consistency to key dimensions like the quality and profitability of the products.2 Moreover, leaders typically do not do the bulk of the hiring, managers do. Managers need to have a good understanding on what the staffing needs are, what to look for in an employee, and make logical and ethical hiring decisions to fill the company with a competent workforce. Weak managers making poor hiring decisions can topple a company from the bottom up. Additionally, after hiring employees, managers must develop peer relationships, carry out negotiations, motivate subordinates, resolve conflicts, establish information networks and subsequently disseminate information.3

One reason why we are still in weak economy is because leaders are acting more like managers by maintaining the status quo rather than forging ahead.  In order to improve a weak economy, managers are needed to “stop the bleeding” caused by the damage made by previous poor economic decisions and leaders are needed to cut our way out of the woods with a sword of innovation. In other words, in order for us to make significant improvements in the economy, we need more innovative leaders that make pioneering decisions coupled with organized, ethical managers that can execute the concepts that the creative leaders produce.

  1. Cruz , E. (2012, Sept. 10). Turning managers to leaders. Business world online, Retrieved from http://www.bworldonline.com/content.php?section=Opinion&title=Turning-managers-to-leaders&id=58236
  2. Kotter, J. (2001, Dec.). What leaders really do. Best of harvard business review, 85-96.
  3. Mintzberg, H. (1990, March). The manager’s job: Folklore and fact. Harvard business review, March-April(1990), 163-176.
  4. Murray, A. (2009, April 07). What is the difference between management and leadership?. The wall street journal, Retrieved from http://guides.wsj.com/management/developing-a-leadership-style/what-is-the-difference-between-management-and-leadership/
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