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Understanding Leadership

Effective leaders take a personal interest in the long-term development of their employees, and they use tact and other social skills to encourage employees to achieve their best. It isn’t about being “nice” or “understanding”—it’s about tapping into individual motivations in the interest of furthering an organization wide goal. by 


The would-be analyst of leadership usually studies popularity, power, showmanship, or wisdom in long-range planning. But none of these qualities is the essence of leadership. Leadership is the accomplishment of a goal through the direction of human assistants—a human and social achievement that stems from the leader’s understanding of his or her fellow workers and the relationship of their individual goals to the group’s aim.

To be successful, leaders must learn two basic lessons: People are complex, and people are different. Human beings respond not only to the traditional carrot and stick but also to ambition, patriotism, love of the good and the beautiful, boredom, self-doubt, and many other desires and emotions. One person may find satisfaction in solving intellectual problems but may never be given the opportunity to explore how that satisfaction can be applied to business. Another may need a friendly, admiring relationship and may be constantly frustrated by the failure of his superior to recognize and take advantage of that need.

In this article, first published in HBR’s September–October 1961 issue, W.C.H. Prentice argues that by responding to such individual patterns, the leader will be able to create genuinely intrinsic interest in the work. Ideally, Prentice says, managerial dominions should be small enough that every supervisor can know those who report to him or her as human beings.

Prentice calls for democratic leadership that, without creating anarchy, gives employees opportunities to learn and grow. This concept, along with his rejection of the notion that leadership is the exercise of power or the possession of extraordinary analytical skill, foreshadows the work of more recent authors such as Abraham Zaleznik and Daniel Goleman, who have fundamentally changed the way we look at leadership.


Leadership is the art of motivating a group of people to act toward achieving a common goal. In a business setting, this can mean directing workers and colleagues with a strategy to meet the company's needs.

  • Leadership is the art of motivating a group of people to act toward achieving a common objective.

  • Organizations refer to upper-level personnel in their management structures as leadership.

  • To be an effective leader in business, you must possess traits that extend beyond management duties.

  • Leadership skills can be learned and leaders may evolve.

  • A person may be referred to interchangeably as both a "leader" and a "manager," though the two terms are not necessarily synonymous.

Leadership vs. Mangement

Leadership captures the essentials of being able and prepared to inspire others. Effective leadership is based upon ideas—both original and borrowed—that are communicated to others in a way that engages them enough to act as the leader wants them to act.

A leader inspires others to act while simultaneously directing the way that they act. They must be personable enough for others to follow their lead, and they must have the critical thinking skills to know the best way to use the resources at an organization's disposal.

In business, leadership is linked to performance, and any leadership definition has to take that into account. Therefore, while leadership isn't intrinsically linked to profit, those who are viewed as effective leaders in corporate contexts are the ones who increase their company's bottom line.

How Does Leadership Work?


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