There are many theories about what makes a good leader. Leadership is often confused with management. A person can be a good leader and a good manager. An organization needs both. The difference is the thought process. Leaders influence and inspire others, deal with change, and take decisive action. They look into the future by creating a vision. This vision is what the end result will be in present time. A manager’s mindset is in the present, usually by performing the day-to-day operations of a business. Managers carry out the visions of leaders.
My current job does not offer an opportunity for a leadership role. However, one day I plan on being an entrepreneur. One thing entrepreneurs do is create jobs. By definition, they create an idea, develop a vision, and put into production. That is how a job is created. The leadership theory many entrepreneurs employ is the transformational leadership theory. A main factor in this method is dealing with change. That is what transforming means. The ideas entrepreneurs come up with almost always involve some sort of change to the current system.
HBR IMPACT ON LEADERSHIP
Harvard Business Review is one of the leading publications on leadership. They took a poll of 195 leaders in 15 countries over 30 global organizations and chose the top 15 out of a possible 74 leadership qualities (Giles 2016). Here are the top five:
Strong ethics and moral standards: This should not surprise anyone. Who does not think fair treatment is a catalyst for success?
Communication of goals and objectives: Goals and objectives are mandatory in creating a plan for success. But what good are they if the stakeholders of an organization do not know what they are?
Flexibility to change: Nothing goes according to plan 100% of the time. Leaders must possess the ability to adapt at a moment’s notice. The filmmaker Kodak could not do this. They stuck with film when it was clear the market was going towards digital. An original Dow company ended up filing for bankruptcy.
Open to new ideas: This could have been grouped with flexibility to change. It is important to consider all of the facts before making decisions, particularly those predicting a market.
Emotional Intelligence: This involves empowering others to reach their full potential without interference. Coaching is acceptable when the employees want to be coached.
TRANSFORMATIONAL THEORY
The transformational theory builds on many of the 74 traits found in the HBR study. It starts with developing an idea and creating a vision. This vision is the big picture, not details. The details are where managers come in. Leading by example is critical at this stage. The vision must excite people. A leader must be persistent in communicating the vision as many may not buy into it initially (Changingminds.org 2016). Leaders know at this stage that it is a continual process and they must build trust through integrity. Henry Ford is one the great leaders of all-time. What was his idea and vision? To build an automobile affordable to the common man (idea) and give them their choice on a lot full of cars (vision).
Next is developing a strategy that puts the idea and vision into production. It is important to note that failure can be a good thing. Failure offers the opportunity to learn about ways not to do things. Tomas Edison failed over a thousand times when developing the light bulb. He looked at it as a thousand ways not to do it correctly. Think of strategy as a blueprint for success. Ford changed the way people did their jobs using the assembly line. The result was an eight hour a day and a five day a week work schedule that many businesses still use today.
Finally, a transformational leader is always visible. They make a commitment to motivate others to keep going. One way they do this is by using mini-ceremonies to celebrate milestones and achievements (Changingminds.org 2016). Many are type "A" personalities that use their charisma to do this. They know what they are doing, inspire others when the going gets tough, and adapt to a changing environment.
ENTREPRENEURIAL LEADERSHIP QUALITIES
As mentioned previously, the transformational theory of leadership applies to many entrepreneurs. The following are some other traits that aspiring entrepreneurs must master:
Admit mistakes: Do not play the blame game. Accept responsibility for your actions and move on.
Willing to take calculated risks: The keyword is calculated. Do not throw darts against a board and hope for the best. Use the Ben Franklin theory of creating a pros and cons list for every decision.
Set realistic goals: Everyone would love to be the next Google or Facebook. See what is there, not what you want to see.
Solve problems: Your product or service must meet a need. Google provided information at the touch of a fingertip, much to the chagrin of encyclopedia salesmen.
Be proactive: Take charge of a situation instead of waiting for something to happen and then reacting to it.
Continuous learning: You will never know everything, even if you are an expert.
Know the right questions to ask: This comes with being prepared and knowing all of the facts before making a decision (Rampton 2016).
Know when to say no and walk away. This may be the toughest thing to do in any situation, not just leadership.
Play to strengths and hire for weaknesses (Rampton 2016). Good leaders know what they are good at and what they are not.
CONCLUSION
Leadership is nothing more than having the ability to get people to follow you. It is a simple definition, but a skill that will never be mastered. People who we consider great leaders, like Warren Buffet and Bill Gates, often answer the question of what they wish they were better at is leadership. In reality, good leaders take bits and pieces from every leadership theory there is. But for entrepreneurs, I think the transformational leadership theory is the most important because of the importance it places on creating a vision and dealing with change. These two things are the essence of what being an entrepreneur is all about.
References
ChangingMinds.org. Transformational Leadership Style. Retrieved June 10, 2016, from
http://changingminds.org/disciplines/leadership/styles/transformational_leadership.htm
Giles, Sunnie. The Most Important Leadership Competencies, According to Leaders Around the
World. Retrieved June 10, 2016, from
https://hbr.org/2016/03/the-most-important-leadership-competencies-according-to-
leaders-around-the-world
Rampton, John. 12 Leadership Traits of the World’s Most Successful Entrepreneurs. Retrieved
June 10, 2016, from
https://www.entrepreneur.com/article/252538
