Leader Vs. Manager: What’s The Difference?
By Robert McGregor, Chief Investment Officer, AEV and AP
In a career spanning almost 41 years, I have probably worked for more companies than some of you had managers. Within each of these companies, I have often worked for multiple managers. Now, some of you may have noticed that the topic of this essay is leadership and yet I have talked only about managers so far. This is not accidental because in my long career I have worked for many managers but have only infrequently encountered leaders – and even less frequently, great leaders.
What’s the difference you may ask? Your boss is your boss but does that automatically mean that he or she is a leader? Not always. A manager controls a group to accomplish a goal and, if you’re lucky, that manager will act according to the principles or values that have been established by the organization (and especially by its leaders). But a leader will provide direction and vision for the future of the group and will use personal skills to influence, to motivate, and to inspire you.
When confronted only by power and control, staff are filled with fear of failure, they are scared to speak up, they feel bullied and eventually they leave. No company wants or needs that kind of leadership.
No great leader succeeds through power and control, and though there may be many examples of such leaders, they are neither great nor are they truly leaders. When confronted only by power and control, staff are filled with fear of failure, they are scared to speak up, they feel bullied, and, eventually, they leave. No company wants or needs that kind of leadership.
In my early days as an aspiring young graduate, I moved to London and worked for British Petroleum, a huge company in a huge industry in an oligopoly of oil giants. But in the hierarchy of the great organizational pyramid (that we call a plantilla), younger people are not exposed to the top leaders and instead have to navigate a minefield of managers – many of whom will never become leaders of any sort.
But, despite their lack of leadership skills, some managers remain good for the organization and exercise key skills in the management of staff. Some managers are productive and very well liked. But there are also many managers who are stuck. Not good enough to progress and not bad enough to be removed. And these people can become problematic if you allow them to be.
Your own attitude is so vital. On top of capability, you need resilience, perseverance, and ambition.
Unfortunately, that’s just part of life and part of the apprenticeship that you must serve as you work your way up the organization. It is not easy, it isn’t smooth, and it isn’t linear. That is why your own attitude is so vital. On top of capability, you need resilience, perseverance, and ambition. But let’s get back to leadership.
I progressed through the organization and eventually became a protégé of another relatively young Scot who took a liking to me and became my first example of a great leader and a mentor. What made him different? He was smart, fearless, knew what he wanted to achieve for the business, and he treated me more like a business partner than an employee. He confided in me, made me aware of organizational politics, made me streetwise in terms of dealing with our franchise holders, and he inspired and motivated me to be all I can be.
Within two years he was promoted and much to the surprise of many others in the organization, I got his job, and I was just 26 years old and in charge of the BP franchise businesses across the whole of Scotland. It was now my turn to be a leader and to exercise some of the teachings from my mentor.
There is absolutely no weakness in demonstrating civility and courtesy.
The first challenge? I think I was younger than the children of my inherited staff, so trying to exercise power and control was out of the question. I had to perform a delicate balancing act in giving direction, influencing, inspiring, and motivating while also showing respect to my elders. They might be working for me but being the boss doesn’t excuse a lack of common sense and good manners. And that applied to my dealings with my entrepreneurial franchise holders. There is absolutely no weakness in demonstrating civility and courtesy.
This approach was to pay-off when, at the age of 29 years old, I was called out of the blue and asked whether I was serious about wanting to run a BP franchise after one of the CEOs had resigned. I took that call on a rainy Friday in a small mining village in Lanarkshire, Scotland and by Monday morning I was in Huntingdon, Cambridgeshire, England as the new CEO of Dominion Oils, with 118 staff, nine oil supply depots and 38 road tankers.
I don’t know who was more surprised, me or 118 staff. Now let me give you an insight into leadership: our leaders are also human beings with emotions and strengths and weaknesses. I jumped into a job that I really wanted but I was also nervous about being able to do it. After the usual handshakes and welcomes, I sat down on my CEO chair, in my CEO office, and I turned around, looked out of the window and thought to myself, “What the hell do I do now?” So much for the image of the great leader. This young so-called whiz kid had jumped right into the deep end.
I then did exactly what I have explained to many of my team members since that day. First of all, I told myself that it was entirely normal to feel estranged when moving to a new job and that nothing would change that feeling other than by giving it time and learning the ropes day by day. But in this instance, I did face the challenge that I had to be seen to lead from day one.
A good leader should be unafraid to reach out and ask for help. They may not have all the answers, but they are not isolated either—they are also networked.
So, I sat down and wrote out all of the questions that were in my head and then I thought about who could help me answer those questions. A good leader should be unafraid to reach out and ask for help. They may not have all the answers, but they are not isolated either—they are also networked. As to who exactly can help me with my questions, the answer was very obvious—all of the other franchise CEOs that I used to deal with from the BP side of the table. Do not be afraid to use your network.
This is where my prior courtesy and respect came to my aide, they could not have helped me more and after several hours of phone calls, I was settled in and now had to face some immediate and serious tests of leadership.
The first thing I had to contend with was a seriously miffed CFO who was older than my dad. I needed him on my side. How would you treat such a situation? Firstly, his CEO resigned; secondly, he didn’t get the job, and, thirdly, he lost out to a 29 year-old. Add to that his reputation for being cantankerous and up comes a significant leadership challenge. Think about what you might do? Here’s what happened: I asked to speak to him but I went to his room rather than ask him to come to me. I then empathized with his obvious ‘pain’ and said, that in his shoes, I would be hurt and angry at the world.
But I said to him that I was here to help, that one day I would go back to BP, and that between now and then, I wanted to improve the company as much as I could. I knew who to contact in BP, I knew where to seek favors, I knew I would receive good support from the center. I then asked him how many times he had thought in his head, “If I was the CEO, I wouldn’t do that or I would do it differently or I wouldn’t do it at all.”
I asked him to share these thoughts with me and, if I agreed with his views, I would make them happen. I also said that I had some ideas of things to change and that I’d bounce them off him before acting. Do you think that was a weakness? By the end of that meeting, I knew the pros and cons of the business and I knew who were the good guys and the bad guys to beware of.
After two weeks, the troublemaker-in-chief (head of Sales Team) was asked to find work elsewhere – you cannot let a bad apple spoil the rest. After one-month, the worst of the salesmen were also asked to leave.
When good staff can see their boss dealing with bad staff, they are relieved rather than angry or afraid.
Did morale drop? Absolutely not. When good staff can see their boss dealing with bad staff, they are relieved rather than angry or afraid. I paid the departing staff a notice period and let them use their car to look for new employment. I did what I had to do but I tried to show some respect. Not to impress those leaving but to impress those who remained.
After two months, the office that was last decorated about twenty years ago was repainted and refurbished. The staff loved their new setting and morale was lifted. But sales were still bad and we were operating at a loss. I had a theory as to why this was happening: we had depots spread all over middle England and most sales were to friends and family.
The sales teams were giving away all of the margin to a customer base that was largely not price-sensitive (poor people do not own oil-fired Aga cookers or have oil-fired heating). This is where you have big choices to make and ideas to implement and I had many ideas that had never been implemented before.
Do you always look to copy or imitate? Are you afraid to suggest change? We want to encourage innovation in the Aboitiz Group, so please think from, first, principles and constantly ask why. Why do we do it this way? Why do we do it at all? You can demonstrate leadership at every level of the company. Every small change is a contribution to innovative thinking.
After three months, I had routed all depot phone calls to a centralized call center in the head office, I had installed a computer system that showed customer margins, I now controlled the pricing from head office. My theory on margins being given away was proven correct. Next, I asked why our road tankers left the depot less than 100% full. I was told we didn’t have enough sales and that tax rules didn’t allow unsold oil to leave the depot. I spoke to the CFO and asked how I could make sure every tanker that left the depot was full.
To increase utilization of the vehicles, we set up a new account under the company’s name. My plan was to look at the vehicle routes and look for existing or past customers on the route. The call-center staff then called that customer, explained that we were passing by and asked whether we could offer to top up their tank.
We almost never got a ‘no’. I also told the drivers that they could knock on the door of anyone they knew and I’d pay them a commission. But then came the last challenge, this era predated anything like mobile phones or laptops. How would the call-center and drivers communicate? Easy – CB radios. My CFO said that everyone would hate them as the drivers could always be tracked down. I disagreed and said that for the first time ever, our drivers could chat to each other all day long. I was right. The drivers loved it.
I was there for only 13 months but we were now profitable and setting standards to be copied by the other franchises. I thought I would go back to BP but being allowed to run a franchise allowed me to look out of the BP window whilst wearing a safety harness. I liked what I saw out there and at the age of 31, I became Head of Sales & Marketing at Scottish Hydro-Electric, the vertically integrated provider of multi-fuel electricity to the North of Scotland. I would have 160 staff. I didn’t know the first thing about electricity and its privatization but that’s a story for another day.
In relaying these stories, I am not seeking to make any intellectual point about leadership – and I am most definitely not trying to blow my own trumpet; I am simply sharing anecdotes to give you some insights into situations I have faced and had to deal with. And I have deliberately gone back to the days when I was younger and trying to be a leader. Whether or not these anecdotes demonstrate good leadership is for you to decide.
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