Importance of Leadership – Management Study Guide

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Leadership is simply defined as the ability to lead a group or an organization. However, that’s the literal definition from the dictionary. When you actually talk to real leaders, you will realize that there are several other layers that go into it. Leaders are present at almost every rung of the corporate ladder, and they play an incredibly important role in the overall growth of the business.

Without effective leaders, the business will not be able to expand on its vision, and the leaders won’t be able to get the best out of the employees. Understanding leadership, and its importance, is of critical importance for businesses that want to grow and succeed. Why is leadership important? Let’s find out.

Understanding Leadership

Before we go further, it’s important to talk about leadership in general. We have already specified the literal definition of leadership, but what does it really mean? Leaders are responsible for not just inspiring and motivating the workforce. They are also instrumental in executing the vision of the company and making sure that objectives are met.

Leadership is all about creating and planning. Leaders are focused on securing different resources and determining how objectives can be met for the company. Without effective leadership at the helm, a company will simply crumble. Directives and instructions are not going to be followed, and the employees will simply go about their way without any regard to the greater objectives set by the organization.

Leaders are all about figuring out the low points and then working on how to overcome them. They know the strengths and weaknesses of their workforce, and they know how to get the best out of them. It’s important to understand that there is a major distinction between leaders and managers.

Management and Leadership

Managers are responsible for managing things and resources within the company. When given a task or a project, it is the manager’s responsibility for making sure that they come up with a viable solution. Managers evaluate the logistics and the budgets, as well as the resources available in the company, to achieve success.

Good managers are those who have excellent leadership skills as well. However, it’s not necessary. It’s not a manager’s job to lead: they are simply responsible for best utilizing the resources of the company to achieve success. On the other hand, leaders have to act as visionaries. They must be responsible for going above and beyond the others.

Leaders don’t just work toward a goal on their own. They don’t take a single-handed approach; they are more responsible for inspiring and motivating others, and of course, leading by example, to achieve the targets. A study by UPenn showed just how important good leadership is in the workplace.

Styles of Leadership

There are different kinds of leadership that can be used in the workplace. However, the two most popular styles of leadership used include autocratic leadership and democratic leadership. Autocratic leadership is all about enforcing the will of the leader. Followers don’t have a say in what they are doing; limited to no input is taken from them.

Autocratic Leaders

Autocratic leadership is often the older, classical style of leadership that was seen in the workplace before. Autocratic leaders simply give directives and set targets, and then they expect the employees to fulfill these objectives. They are not concerned about anything else. They decide what needs to be done and how it needs to be done.

Autocratic leadership may seem bad, but it’s not all wrong. In some situations, autocratic leadership might be a suitable choice. Autocratic leadership might be suitable in environments where an experienced leader has to guide a group of new or inexperienced professionals.

For instance, when an experienced employee is dealing with management trainees, they often take an autocratic approach to leadership. They want to make sure that everything is done in the right manner and according to their preferences. That’s why they give detailed instructions to the employees.

Democratic Leaders

Democratic leaders are different from autocratic leaders. In fact, some might consider them to be the exact opposite of autocratic leaders. Democratic leaders take input from their subordinates and employees, and they pay heed to their words. They believe that the employees in the trenches are the ones who have the best idea about how the company should be run.

They are very careful when making a decision because they understand how it could affect employee morale. While democratic leaders take a different approach, the main focus is the same: achievement of objectives. There are drawbacks and advantages of both of the different styles of leadership, but it’s easy to understand that the paradigm is shifting.

More and more companies and leaders are now adopting a democratic style of leadership because they realize employees are more than capable of handling themselves. This style of leadership is also quite effective in situations where the employees know a thing or two about what they are doing.

What Makes a Good Leader?

Contrary to what most people might say, good leaders are simply made. There’s no denying that there are a few people who are born with this innate ability to lead others, but there are always instances in life that can turn a person to lead. There are several key traits that good leaders share, and ones that you should know.


One of the key traits of good leaders is that they are quite decisive. They understand that wasting time on small decisions is not worth it, so they almost always automate all parts of their lives that they can. This leads them to become more decisive in making key decisions.

They are able to think better and they are able to decide what they need to do. They commit to their goals and are quite focused in achieving their targets as well.

They Lead by Example

Good leaders almost always practice what they preach. You won’t find these people talking a specific tune and walking a different one. They firmly believe in what they say, and they have no compulsion in getting their hands dirty to assist their employees.

They have an ability to be the first ones to make the jump and they are constantly looking at different ways by which they can excel. These people lead by example and know just what it takes to motivate their workforce. They are more than happy to assist their employees and are willing to go the extra mile and do whatever it takes to make sure that work is completed.

They Have a Firm Eye on Their Goals

Good leaders always know what they are working for. They never lose sight of their goals and are focused on making sure that the company is able to meet its objectives with ease. Without good leadership at the helm, it can be difficult for employees to remain motivated and to achieve their targets. These are just a few reasons why leadership is so critically important.


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