The Essential Elements of Leadership in a Small Business

Leadership Traits

Over the past several years, one of the most important contributions psychology has made to the field of business has been in determining the key traits of acknowledged leaders. Psychological tests have been used to determine what characteristics are most commonly noted among successful leaders. This list of characteristics can be used for developmental purposes to help managers gain insight and develop their leadership skills.

The increasing rate of change in the business environment is a major factor in this new emphasis on leadership; whereas in the past, managers were expected to maintain the status quo in order to move ahead, new forces in the marketplace have made it necessary to expand this narrow focus. The new leaders of tomorrow are visionary. They are both learners and teachers. Not only do they foresee paradigm changes in society, but they also have a strong sense of ethics and work to build integrity in their organizations.

Raymond Cattell, a pioneer in the field of personality assessment, developed the Leadership Potential equation in 1954. This equation, which was based on a study of military leaders, is used today to determine the traits which characterize an effective leader. The traits of an effective leader include the following:

• 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 one's 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 thick-skinned. Overall, they are responsive to others and tend to be high in emotional stamina.
• Tough-mindedness. Good leaders are practical, logical, and to-the-point. They tend to be low in sentimental attachments and comfortable with criticism. They are usually insensitive to hardship and are very poised.
• 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 secure and free from guilt and are usually unaffected by prior mistakes or failures.
• Compulsiveness. Leaders were found to be controlled and very precise in their social interactions. Overall, they were 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.

Beyond these basic traits, leaders of today must also possess traits which will help them motivate others and lead them in new directions. Leaders of the future must be able to envision the future and convince others that their vision is worth following. To do this, they must have the following personality traits:

• High energy. Long hours and some travel are usually a prerequisite for leadership positions, especially as your company grows. Remaining alert and staying focused are two of the greatest obstacles you will have to face as a leader.
• 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.
• Maturity. To be a good leader, personal power and recognition must be secondary to the development of your employees. In other words, maturity is based on recognizing that more can be accomplished by empowering others than can be by ruling others.
• Team orientation. Business leaders today put a strong emphasis on team work. Instead of promoting an adult/child relationship with their employees, leaders create an adult/adult relationship which fosters team cohesiveness.
• 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.
• 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.

Overall, leaders are larger than life in many ways. Personal traits play a major role in determining who will and who will not be comfortable leading others. However, it's important to remember that people are forever learning and changing.

Leaders are rarely (if ever) born. Circumstances and persistence are major components in the developmental process of any leader, so if your goal is to become a leader, work on developing those areas of your personality that you feel are not up to par. For instance, if you have all of the basic traits but do not consider yourself very much of a people person, try taking classes or reading books on empathy. On the other end, if relating to others has always come naturally to you, but you have trouble making logical decisions, try learning about tough-mindedness and how to develop more psychological resistance. Just remember, anyone can do anything they set their mind to.

Are you a manager or a leader?

Are you a manager or a leader? Although you may hear these two terms thrown out interchangeably, they are in fact two very different animals complete with different personalities and world views. By learning whether you are more of a leader or more of a manager, you will gain the insight and self-confidence that comes with knowing more about yourself. The result is greater impact and effectiveness when dealing with others and running your business.

We are going to take a look at the different personality styles of managers versus leaders, the attitudes each have toward goals, their basic conceptions of what work entails, their relationships with others, and their sense of self (or self-identity) and how it develops. Last of all, we will examine leadership development and discover what criteria is necessary for leaders to reach their full potential.

First of all, let's take a look at the difference in personality styles between a manager and a leader.

Managers - emphasize rationality and control, are problem-solvers (focusing on goals, resources, organization structures, or people), often ask question, "What problems have to be solved, and what are the best ways to achieve results so that people will continue to contribute to this organization?", are persistent, tough-minded, hard-working, intelligent, analytical, tolerant, and have goodwill toward others.

Leaders - are perceived as brilliant, but sometimes lonely, achieve control of themselves before they try to control others, can visualize a purpose and generate value in work, and are imaginative, passionate, non-conforming risk-takers.

Managers and leaders have very different attitudes toward goals.

Managers - adopt impersonal, almost passive, attitudes toward goals, decide upon goals based on necessity instead of desire and are therefore deeply tied to their organization's culture, and tend to be reactive since they focus on current information.

Leaders - tend to be active since they envision and promote their ideas instead of reacting to current situations, shape ideas instead of responding to them, have a personal orientation toward goals, and provide a vision that alters the way people think about what is desirable, possible, and necessary.

Now let's look at managers' and leaders' conceptions of work.

Managers - view work as an enabling process, establish strategies and makes decisions by combining people and ideas, continually coordinate and balance opposing views, are good at reaching compromises and mediating conflicts between opposing values and perspectives, act to limit choice, and tolerate practical, mundane work because of a strong survival instinct which makes them risk-averse.

Leaders - develop new approaches to long-standing problems and open issues to new options, first use their vision to excite people and only then develop choices which give those images substance, focus people on shared ideals and raise their expectations, and work from high-risk positions because of strong dislike of mundane work.

Managers and leaders have very different relations with others.

Managers - prefer working with others, report that solitary activity makes them anxious, are collaborative, maintain a low level of emotional involvement in relationships, attempt to reconcile differences, seek compromises, and establish a balance of power, relate to people according to the role they play in a sequence of events or in a decision-making process, focus on how things get done, maintain controlled, rational, and equitable structures, and may be viewed by others as inscrutable, detached, and manipulative.

Leaders - maintain inner perceptiveness that they can use in their relationships with others, relate to people in intuitive, empathetic way, focus on what events and decisions mean to participants, attract strong feelings of identity and difference or of love and hate, and create systems where human relations may be turbulent, intense, and at times even disorganized.

The Self-Identity of managers versus leaders is strongly influenced by their past.

Managers - report that their adjustments to life have been straightforward and that their lives have been more or less peaceful since birth, have a sense of self as a guide to conduct and attitude which is derived from a feeling of being at home and in harmony with their environment, see themselves as conservators and regulators of an existing order of affairs with which they personally identify and from which they gain rewards, report that their role harmonizes with their ideals of responsibility and duty, perpetuate and strengthen existing institutions, and display a life development process which focuses on socialization. This socialization process prepares them to guide institutions and maintain the existing balance of social relations.

Leaders - reportedly have not had an easy time of it, their lives are marked by a continual struggle to find some sense of order, do not take things for granted and are not satisfied with the status quo, report that their sense of self is derived from a feeling of profound separateness, may work in organizations, but they never belong to them, report that their sense of self is independent of work roles, memberships, or other social indicators of social identity, seek opportunities for change (i.e. technological, political, or ideological), support change, find their purpose is to profoundly alter human, economic, and political relationships, and display a life development process which focuses on personal mastery. This process compels them to struggle for psychological and social change.

Development of Leadership

As you can see, managers and leaders are very different animals. It is important to remember that there are definite strengths and weaknesses in both types of individuals. Managers are very good at maintaining the status quo and adding stability and order to our culture. However, they may not be as good at instigating change and envisioning the future. On the other hand, leaders are very good at stirring people's emotions, raising their expectations, and taking them in new directions (both good and bad). However, like artists and other gifted people, leaders often suffer from neuroses and have a tendency toward self-absorption and preoccupation.

If you are planning on owning your own business, you must develop management skills, whether they come naturally or not. However, what do you do if you believe you are, in fact, a leader - a diamond in the rough? What can you do to develop as a leader? Throughout history, it has been shown again and again that leaders have needed strong one-on-one relationships with teachers whose strengths lie in cultivating talent in order to reach their full potential. If you think you are a leader at heart, find a teacher that you admire - someone who you can connect with and who can help you develop your natural talents and interests. Whether you reach glory status or not, you will grow in ways you never even imagined. Isn't that what life is about anyway?