What are the fundamentals that a business must know about leadership and management to promote long-term success? Let’s start with two simple definitions.

• Management is about achieving business results through developing and executing efficient and effective systems and use of resources
• Leadership is about achieving business results through inspiring people to do what is right.

The following chart expands on these definitions.

To be successful, a “manager” must also be able to lead people by developing meaningful and productive relationships with those who implement and execute management systems. And, a “leader” must be able to understand and manage the technical disciplines and consistent processes designed into productive systems.

I’ve seen managers who don’t develop leadership skills, causing morale and turnover problems, breakdowns in customer service, and excessive costs. And, I’ve seen leaders who don’t understand important management processes, such as project management and budgeting, who waste time, resources, and cause quality and customer service issues. The point is that both management and leadership are inextricably linked, regardless of “title,” and both can be learned.

There are some who argue that one must possess certain personality traits or charisma to be a good leader. I don’t agree. Certainly, a person who is unfriendly, autocratic, belittling, or uncommunicative does not exhibit the skills and behaviors to build meaningful and productive relationships with people. But, fundamentally, good leadership is about:

• demonstrating respect for the inherent dignity and worth of others
• holding honorable intentions of wanting to help others succeed
• being honest in a timely, respectful, and effective manner
• helping people develop their skills to be successful in their jobs, and
• learning an effective method of delegation and accountability

One example: Toyota was the first car manufacturer to provide employees with the education and authority to stop the highly engineered assembly line if a quality problem occurred. This is an example of bringing leadership responsibility right down to front-line employees. Toyota educated people to understand the management process, the organization’s mission and values, and empowered them to make important decisions in the best interests of customers, the company, and their own job satisfaction.

Often, entrepreneurs who start-up businesses possess the technical management knowledge of how the business works but lack the proactive leadership skills required to implement their vision. This is one reason why so many businesses fail during the first few years. In such instances, an executive coach can help develop the skills to strengthen communication, relationships, and trust required for business success.