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Can Too Many Cooks Spoil the Broth? The Difference Between Leaders and Managers

Can Too Many Cooks Spoil the Broth? The Difference Between Leaders and Managers

by David Landau

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Managers and leaders are very different beasts. Managers administer and organise where leaders innovate and inspire (that’s the idea around the rhetoric, at least). However, in truth, both roles have their benefits. In the Accounting and Finance industry, where balancing innovation and stability is crucial both are required if your business is to achieve sustained success. Though there is much said about the abundance of people in unnecessary middle-management roles, having too many leaders can be just as detrimental.

So, what is the difference? In this article we delve into what makes a leader and what makes a manager and provide some tips on how to cultivate an organisation where true leaders can thrive.

Role Purpose

Managers are focused on dealing with the budgets, the staff, input and output – the management of the workload, if you will. They spend time agonising over how they will impact the bottom line and how they can hit their month end targets. Those who are successful as managers are typically task oriented, risk averse and abide by company values and policies.

Managers generally hire people to perform a specific set of tasks to get the right output as per their job description, monthly team meeting or other remit. The team typically performs the same job over and over and the manager drives the team’s performance through control. One might say that motivation isn’t necessary as a manager as their job is purely to drive consistency and sustain results, although managers may dispute this. It’s probable that this is more evident in transactional functions.

Leaders, however, motivate people in a different way, uniting them with a common vision and mission. They assign each task with a goal, encouraging buy-in and ownership from all team members. This results in the team feeling motivated and enthused because now they can really understand why they are performing a task versus simply knowing how to do it. They are part of the bigger picture and understand how their role makes a difference to the company as a whole. This can help to drive innovation and increase morale, however, there is also a balance to keep. Having too many people trying to lead inevitably leads to issues long-term, so great leaders are aware of exactly where and when to draw a line under an issue.

Self-awareness

True leaders understand that they don’t know everything and that’s okay! They regularly assess themselves and know their strengths, and more importantly their weaknesses, and don’t hide behind others. They are happy to put their hands up when they are wrong or don’t know something, and are focused on learning and developing throughout their careers. They have the confidence to lead through trust and as a result their teams feel empowered to do their job. A famous quote to sum this up is, “When I talk to managers I get a feeling that they are important; when I talk to leaders I get a feeling that I am important.” Leaders are focused on developing their team members and seeing them grow into the best versions of themselves, without feeling threatened. This gives teams more freedom, however, if not managed correctly it can also lead to less productive output.

Great managers however are focused on getting shorter-term results, they understand that everyone must perform their individual jobs well to hit the company’s targets. They are focused on the detail, ensuring the boxes are ticked and the rules are followed.

Create value

Managers count value whereas leaders create it. Whilst managers have subordinates and circles of power, leaders have followers and circles of influence. A leader’s value is felt throughout the company and can be measured by how many people outside of their reporting line come to them for advice. Managers add value by tightening up and managing existing processes, leaders create new value throughout the business by sharing their ideas, as well as providing a platform for others to innovate.

Who should you hire?

The best profile that suits your business will depend on many variables, including the size of your company, the business objectives and any growth plans. A company with 10 employees does not need 5 leaders, and hiring too many leaders and not enough managers may actually have an adverse effect – there is such a thing as too many cooks, especially in a small organisation!

In fact, in smaller companies, there is often a need for one person to fill the role of both manager and leader. While structure and inspiration don’t always go hand in glove, identifying the people who are able to organise and manage whilst maintaining the strategic, people-focused approach of a leader, will put your business in good stead. Keep in mind however that these people are a rare breed, and putting this responsibility onto someone who may be better suited to one role or the other may have a negative impact.

When hiring new employees, finance team managers need to assess whether they are looking for someone with leadership qualities or a more managerial style. In any organisation, there still needs to be people in the business who are focused on hitting the end of financial year deadlines, ensuring the debtor days are hitting KPIs, who are focused on organising and controlling.

The simple graphic below can help to sum up the characteristics associated with each:

Hiring and cultivating leaders

Effective leaders inspire and motivate, and the impact this can have on your business can’t be underestimated. Warren Bennis, a leadership expert, once said, “A business short on capital can borrow money and one with poor location can move, but a business short on leadership has little chance of survival”.

An inspired and motivated workforce is driven and energised and wants to come into work. This has a huge impact on the culture of the company, improving retention and making talent attraction easier.

A leader always has their eye on the horizon and takes a long-range perspective, they innovate and their teams are always looking to improve the status quo. The result is a company that is always evolving, changing with the times and aligned to the market.

How can you engage leaders in your business?

Leaders want to work for a great brand with a great reputation. But, so does everyone! However, because of the nature of their roles, leaders tend to thrive in companies (and positions) where creativity, long term vision and trust are the norm – or a company where they can help to establish those foundations. This type of culture is where leaders can flourish, and add the most value to the business.

Organisations would do well to identify employees with leadership qualities as early as possible, especially in smaller businesses where potential is a key consideration. Encourage these employees to network, challenge their thinking, assign them tasks outside their comfort zone, and match them with a great mentor – these employees could be the leaders of tomorrow. If you’re looking externally to bring leaders into your business, get in touch with Sydney’s expert Accounting recruiters, and we’ll help you find the people who can drive your organisation forward.