What is organizational leadership?
Organizational leadership is leadership in business that focuses on directing an organization, usually from the top down.
There are certainly different leadership and management styles within an organization.
In this article, though, we will focus on the most common – hierarchical top-down leadership styles.
Specifically, we’ll look at organizational leadership in detail, including:
- What is organizational leadership?
- Who are the leaders in an organization?
- How is leadership different from management?
To start, let’s define leadership in detail:
What Is Organizational Leadership?
Organizational leaders direct an organization.
They make high-level decisions and determine an organization’s:
- Strategy – How best to operate, which business decisions make the most sense, and what strategic choices to make given their unique business environment.
- Direction – The overall aim of an organization in its marketplace and its economic ecosystem.
- Vision – The founders are typically those who create the original vision of an organization. However, over time, business leaders may need to renew that vision.
- Objectives – Which goals an organization should pursue, which goals each department should pursue, and which should be sidelined or avoided.
- Investments – How and where to invest resources, such as financial capital and human capital.
Organizational leaders are, in short, “leaders of leaders.”
That is, they lead other managers and leaders within an organization.
Who Are the Leaders of an Organization?
Who is considered a “business leader” may vary from business to business.
In a small business, it may simply be the owner.
In an enterprise, however, it usually includes members of the C-suite:
- CEOs – Chief Executive Officers are those who are responsible for operating and leading the entire organization.
- CTOs – Chief Technology Officer is similar to the CIO, and in some cases it is interchangeable. In some organizations, the title of CIO has replaced the CTO.
- CMOs – Chief Marketing Officers lead the marketing divisions, overseeing other marketing managers and sub-departments.
- CIOs – Chief Information Officers operate and run the IT divisions, making decisions regarding IT, technology, and so forth.
Leaders such as these are collectively responsible for making top-down organizational decisions.
Each department head will lead their own department, respectively.
And collectively, they will make decisions for the entire organization.
Organizational Leadership vs. Organizational Management
Leadership and management are two distinct disciplines, though they can overlap in the real world.
Technically, leaders are those who drive a movement forward.
Managers are responsible for duties such as:
- Supervision – Supervising the activity of those within their departments and ensuring that teams work together smoothly. They assign team members, communicate with relevant departments, oversee and conduct projects, and so forth.
- Organization – Organizations must stay organized to run efficiently. That is, managers must engage in a variety of activities that keep operations running smoothly. These can include mediating conflict, scheduling, planning, coordinating engagements, allocating resources, and so forth.
- Improving Efficiency and Effectiveness – Managers must also do their best to decrease costs and improve performance within their areas. Improving efficiency can involve a wide range of activities, including designing better workflows, changing business procedures, and improving team synergy, among other things.
These are just a few examples of what managers do.
While leaders make high-level strategic decisions and set goals, managers ensure that the organization achieves those goals effectively.
Both are essential to the healthy functioning of any business.
Management without leadership would result in an efficient organization – without direction.
Leadership without management would results in an organization that has a strong vision – but that lacks organization.
Other Types of Management
You could view leadership and management as two sides of the same coin.
Each business function requires both – every business area must be led and managed.
Here are a few examples of the management duties for a few departments.
- Operations – Operational leaders ensures that the day-to-day business runs smoothly. This department focuses on ensuring that the raw supplies reach the end consumers quickly, cost-efficiently, and with minimal disruption.
- Human Resources – Human resources managers handle everything having to do with employees. They supervise recruitment, orientation, onboarding, employee training, the employee experience, payroll, attendance, and more.
- IT – Information Technology, of course, deals with digital technology. Depending on the organization, they can handle security, software updating and maintenance, IT services management, digital adoption, and other IT-related business tasks.
- Sales and Marketing – Managers for these departments focus on improving the efficiency of their respective pipelines. Each oversees the testing of new marketing campaigns, allocates marketing investments, supervises personnel, and so forth.
The list, of course, could go on.
As mentioned, each of these departments requires management – but they must also be led.
In many cases, this directed leadership comes from the top of the organization. However, leadership skills can (and should) be present at every level of the organization.
What Makes a Good Organizational Leader?
Good leaders, like good managers, must have a few essential skills, such as:
- Strong communication skills
- Ability to manage and direct people
- Be able to make decisions – and have others follow them
- Be comfortable being “in the spotlight” and at the top of an organizational hierarchy
- Resilience, flexibility, and adaptability – requirements in demanding leadership positions
These are just a few of the many characteristics that can help leaders succeed.
However, organizational leaders need more than just skills. They must also have a strong, proven track record of success. And they should have a strong network of relationships, business partners, and contacts.
Becoming an organizational leader is no easy path. It carries a great deal of responsibility and can be a very difficult role.
For those who have the right temperament and skills, though, it can be a very rewarding, lucrative career.