Leadership or Management

Leadership has been described as "a process of social influence in which a person can enlist the aid and support of
others in the accomplishment of a common task". For example, some understand a leader simply as somebody whom
people follow, or as somebody who guides or directs others, while others define leadership as "motivating and
organizing a group of people to achieve a common goal".
Leadership is the single most important factor in the success or failure of a company or business. The ability to step
forward and lead the enterprise to success in competitive markets is both essential and irreplaceable.
The better you become as a leader, the better you will be in every area of your enterprise. Fortunately, leaders are
made, not born. As Peter Drucker said, There may be such a thing as a natural born leader, but there are so few of
them, that they make no difference in the great scheme of things.
Leaders are primarily self-made, self-developed. They work on themselves continually, learning, growing, and
becoming more capable and competent over the years.
Leaders usually emerge to deal with a situation that requires leadership skills. A manager can work successfully at
fulfilling his responsibilities and getting the job done for many years. Then a crisis occurs, and leadership is required.
At that time, the leader steps forth and takes charge of the situation. He or she becomes a different person and fulfills a
different role.
Leaders help themselves and others to do the right things. They set direction, build an inspiring vision, and create
something new. Leadership is about mapping out where you need to go to "win" as a team or an organization; and it is
dynamic, exciting, and inspiring.
Yet, while leaders set the direction, they must also use management skills to guide their people to the right destination,
in a smooth and efficient way.
The traits of an effective leader
Emotional stability: Good leaders must be able to tolerate frustration and stress. Overall, they must be well-adjusted
and have the psychological maturity to deal with anything they are required to face.
Dominance: Leaders are often competitive, decisive and usually enjoy overcoming obstacles. Overall, they are
assertive in their thinking style as well as their attitude in dealing with others.
Enthusiasm: Leaders are usually seen as active, expressive and energetic. They are often very optimistic and open to
change. Overall, they are generally quick and alert and tend to be uninhibited.
Conscientiousness: Leaders are often dominated by a sense of duty and tend to be very exacting in character. They
usually have a very high standard of excellence and an inward desire to do their best. They also have a need for order
and tend to be very self-disciplined.
Social boldness: Leaders tend to be spontaneous risk-takers. They are usually socially aggressive and generally thickskinned. Overall, they are responsive to others and tend to be high in emotional stamina.
Self-assurance: Self-confidence and resiliency are common traits among leaders. They tend to be free of guilt and
have little or no need for approval. They are generally unaffected by prior mistakes or failures.
Empathy: Being able to put yourself in the other person's shoes is a key trait of leaders today. Without empathy, you
can't build trust; without trust, you will never be able to get the best effort from your employees.
Compulsiveness: Leaders are controlled and very precise in their social interactions. Overall, they are very protective
of their integrity and reputation and consequently tended to be socially aware and careful, abundant in foresight, and
very careful when making decisions or determining specific actions.
Intuitiveness: Rapid changes in the world today, combined with information overload result in an inability to know
everything. In other words, reasoning and logic will not get you through all situations. In fact, more and more leaders
are learning the value of using their intuition and trusting their gut when making decisions.
Charisma: People usually perceive leaders as larger than life. Charisma plays a large part in this perception. Leaders
who have charisma are able to arouse strong emotions in their employees by defining a vision which unites and

captivates them. Using this vision, leaders motivate employees to reach toward a future goal by tying the goal to
substantial personal rewards and values.
Management is the organization and coordination of the activities of a business in order to achieve defined objectives.
Management is often included as a factor of production along with machines, materials, and money. According to the
management guru Peter Drucker (1909-2005), the basic task of management includes both marketing and innovation.
Management consists of the interlocking functions of creating corporate policy and organizing, palnning, controlling,
and directing an organizations resources in order to achieve the objectives of that policy.
The directors and managers who have the power and responsibility to make decisions and oversee an enterprise.
The size of management can range from one person in a small organization to hundreds or thousands of managers in
multinational companies. In large organizations, the board of directors defines the policy which is then carried out by
the chief executive officer, or CEO. Some people agree that in order to evaluate a company's current and future worth,
the most important factors are the quality and experience of the managers.
Management is the process of ensuring that an organization or company is able to operate in both the immediate and
near future.
In any enterprise there are seven key roles of the manager. Each of them is only learned through trial and error and
continuous practice. But they all may and must be learned to realize your full potential as a leader.
1. Planning is the process of determining exactly what is to be done.
Action without planning is the cause of every failure. Action preceded by thorough planning is usually the reason for
every success.
2. Organizing is the process of assembling the people and resources
you will need to fulfill the plan and achieve your goals.
This is a key skill of leadership. People with good organizational skills are invaluable to any organization. Nothing is
possible without them.
3. Staffing
You must attract and keep the people you need to carry out the plan and achieve the desired results.
The ability to hire and keep the right people will account for as much as 95 percent of your ultimate success. Most of
your frustrations and failures will be the result of having the wrong person in a key position.
4. Delegation is the skill of assigning the right job to the right person in the right way.
You always have two choices: You can either do the job yourself, or you can get someone else to do it. Proper
delegation is how you make sure that someone else does the job to an acceptable level of quality. The ability to
delegate effectively is the key to leveraging yourself and multiplying your value to your company. Delegation allows
you to move from what you can do personally to what you can manage.
5. Supervising is the process of making sure the job is done on time and on budget. Delegation is not abdication; you
are still accountable for results. The more important the job is, the more important it is that you keep on top of it. The
job of the manager is to get things done through others. The ability to supervise others can be greatly improved by
learning what other excellent managers have discovered over the years and by applying these principles and ideas to
your interactions with your subordinates.
6. Measuring requires setting metricsmeasures and numbers for each part of the work, including setting
standards of performance for each job. Every business activity can be expressed and defined in numbers of some kind,
typically financial numbers
7. Reporting You must keep the key people inside and outside of your business informed at all times.
This is one of the most important responsibilities of leadership and of people at every level of the organization.
Fully 95 percent of problems in a company can be traced back to poor or nonexistent communications. People were
not informed of events or given information that was essential to their ability to do their jobs correctly. Knowing how
to report to your boss is a key skill of managing up.
According to numerous surveys of employees in the work world, the best bosses and supervisors possess three
qualities:

1. Structure. Everyone knows exactly what needs to be done, why it is to be done, and to what standard.
2. Consideration. The boss makes employees feel that he or she really cares about them.
3. Freedom. Good bosses give their people freedom to perform. Once they have assigned a task, they try to stay out of
the way, except to comment and to help when needed.
The main difference between leaders and managers is that leaders have people follow them while managers have
people who work for them.
A successful business owner needs to be both a strong leader and manager to get their team on board to follow them
towards their vision of success. Leadership is about getting people to understand and believe in your vision and to
work with you to achieve your goals while managing is more about administering and making sure the day-to-day
things are happening as they should.

Case Study
Amancio Ortega - ZARAs founder
Amancio Ortega is the third richest man in the world, but many people have never heard of him.
Amancio Ortega, a simple Spanish man who has revolutionised the trend in the global fashion industry. He owns
Inditex, one of the largest fashion distributors in the world and founded fashion labels like: Zara, Massimo Dutti,
Bershka, Pull & Bear and many more.
Nowadays, Zara is known for selling quality designer clothes for reasonable prices. Infact, some claim that Zara
embodies the 'affordable luxury'. Today, Zara contributes 70% of Inditex's revenue and has make Ortega the 3rd
richest man in the world. Zara's business model success has seen its expansion of 6,000 store in 89 markets.
Amancio Ortega's leadership skills has contributed a big part in his success. It describes a leader with a strong vision
and are clear about his purposes at all times.
True leaders first envision a better future and strive hard for as long as it takes to reach its success.
As a founder, he practiced a kind of autocratic leadership style where the concentration of power was focused on him.
He formed a business model which has been effective till today.
As his business soared, the leadership style transformed to a democratic way of leadership. Apart from the CEO,
different departments in the headquarters, regional and country managers were empowered to manage the store in their
respective areas. Employees like store managers were empowered by having autonomy. This is to make them
appreciate the value of freedom and to give them an opportunity of experiencing the entrepreneur spirit. However, the
connection between the stores and headquarters should not be broken.
Ortega emphasised his unique business model to his employees which concentrates on three wining aspects: Short
lead times, lower quantities and a variety of styles.

Short lead-times = More clothes produced

Lower quantities = Higher quality

Variety of styles = More choices, more business

As for Zaras shareholders, their aim is to increase their sales and profits. The only option there is to increase a
business sales and profits is to work harder. Therefore, employees need to put extra effort into their work. To motivate
employees to work harder, they need to receive something in return which can be some kind of reward for them.
Ortegas philosophy is not only to monitor the work done by employees, but to also make sure they get their job
satisfaction. Some of the motivational factors Ortega applied in Zara were:

Each member had autonomy

By having autonomy, they would feel like leaders of themselves. It will enable them to value the idea of freedom in
the company.

Financial and non-financial rewards

-Employees would receive bonuses if theyre quality of work is up to standard

-Healthcare coverage
-Paid time off
Team building could affect the motivation of the employees. As team building requires collaboration, employees
would have to cooperate with one another during meetings or discussions. Members who are normally left out, would
get a chance to speak out and give out their own thoughts. It helps get them out of their comfort zone and build their
self-esteem. With this, they would be more motivated to come to work daily, as they would feel that they do play a
role in the company.
There is a definite need of training in every organization or company. Without training, staff would not acquire skills
as they progress on with their duties. Zara offers paid training programs which helps develop employees career and
their pay.
The job trainings are offered to those who still need improvements based on their progress of work.
Zara also offers in-job trainings for staff who are already in management roles so that the process of learning and the
development of inheriting new skills will never come to an end. In this way, the standard of Zara would always
maintain.
Zara practices an evaluation system where the employees will get interviewed by store managers and their own
department store manager. This allows the managers to know what level the employee is currently at and what
trainings and improvements that should be made. This indeed is a very good system as it lets employees have room for
more improvement which will then lead to a successful company.
Zara does not offer soft-skill training but Ortega requires soft-skill characteristics in each and every single employee;
which consists of:
Leadership qualities
Good attitude
Talented
Energetic
Challenging
Collaborative