OCW042: Characteristics of Good Managers


Leadership is organizing a group of people to achieve a common goal.

Learning Objectives

Differentiate between a leader and a manager

Key Takeaways

Key Points

  • While people can manage many things, including their time, money, fuel consumption, and people, one can only lead people.
  • Even though leadership is a subset of management, the term “leader” seems to have a halo attached to it, while the term ” manager ” comes with a bit of a stigma.
  • The search for the qualities that make a good leader has been going on for centuries and continues today.

Key Terms

  • lead: To provide direction and influence.
  • manage: To handle or control a situation or job.

Management and Leadership

In today’s business world, there seems to be a halo affixed to the term “leader,” while the label of “manager” has a more negative connotation. “Leader” brings to mind heroic figures rallying people together to give their all for a cause, while “manager” brings to mind less-charismatic individuals trying to make people into more efficient cogs in the corporate machine.

When one considers this definition of management, it becomes apparent that leadership is actually a sub-category of management. Management (from Old French ménagement, “the art of conducting, directing,” from Latin “manu agere” or “to lead by the hand”) characterizes the process of leading and directing all or part of an organization, often a business, through the deployment and manipulation of resources (human, financial, material, intellectual, or intangible).

People can manage their time, their budget, their fuel, and yes, their people, but one can only lead people (or to be more inclusive, one can only lead intelligent living things, since shepherds and dog trainers may object to a homo sapiens-centric definition).

Perhaps the perception of a cog-manipulating manager is rooted in this difference between animate and inanimate objects. When people feel used, manipulated, or led against their will by a person in authority, they feel as if they are being treated like inanimate objects. They say the person in authority is a “lousy manager. ” But when the person in authority increases their autonomy, makes them feel at liberty to accept or reject his or her vision, and fills them with a real personal desire to bring this vision to life, they say he/she is a great leader.

Great leaders are often described as having charisma. Charisma is defined as a compelling attractiveness or charm that can inspire devotion in others. Also, many great leaders have referent power, which is the ability to inspire their followers with a high level of identification with, admiration of, or respect for the powerholder/ leader.

Leadership in a Team Setting

When applying these concepts for “manager” and “leader” in a team setting, one finds interesting results. If there is a team leader that is perceived to be unconcerned with the team members’ needs or has a personal agenda more important than the team’s goals, then the leader is perceived to be more of a “manager” and becomes estranged from the team members. Conversely, the team leaders who are admired and followed loyally are those who show concern for the team members as individuals with real needs, and who put “the cause” of the team above their own persona agenda.

Realistically, most organizations do need leaders who sometimes look at their teams with cold, analytical eyes, evaluating inefficiencies and making unpopular choices. But it would be a mistake to think that one has to be an “estranged, unliked manager” in order to execute these responsibilities. If a team leader’s tasks, such as efficiency analysis, were done hand-in-hand with sincerely seeking to know team members’ individual needs, then the team leader would be perceived to have a genuine desire to make the team more successful. Additionally, ineffective leaders may hide an unwillingness to make tough decisions by faking the “touchy-feely” attitudes associated with great leaders with high emotional-intelligence.

Leadership Research

Leadership is ” organizing a group of people to achieve a common goal”. The leader may or may not have any formal authority. Scholars of leadership have produced theories involving traits, situational interaction, function, behavior, power, vision and values, charisma, and intelligence, among others.


US Army leadership: Commander of the International Security Assistance Force Gen. David H. Petraeus (center), U.S. Army, talks with U.S. soldiers of the 2nd Battalion, 327th Infantry Regiment, 1st Brigade Combat Team, 101st Airborne Division at Combat Outpost Monti in eastern Afghanistan on Aug. 5, 2010.

New methods and measurements were developed after these influential reviews that would ultimately re-establish the trait theory as a viable approach to the study of leadership. For example, improvements in researchers’ use of the round robin research design methodology allowed researchers to see that individuals can and do emerge as leaders across a variety of situations and tasks.

Additionally, during the 1980s, statistical advances allowed researchers to conduct meta-analyses, in which they could quantitatively analyze and summarize the findings from a wide array of studies. This advent allowed trait theorists to create a comprehensive picture of previous leadership research rather than rely on the qualitative reviews of the past. Equipped with new methods, leadership researchers revealed that individuals can and do emerge as leaders across a variety of situations and tasks. They found significant relationships between leadership and individual traits such as the following:

  • Intelligence
  • Adjustment
  • Extraversion
  • Conscientiousness
  • Openness to experience
  • General self-efficacy

While the trait theory of leadership has certainly regained popularity, its re-emergence has not been accompanied by a corresponding increase in sophisticated conceptual frameworks.

Styles of Leadership

A leadership style is the manner and approach of providing direction, implementing plans, and motivating people.

Learning Objectives

Recognize the differences between different leadership styles and attitudes

Key Takeaways

Key Points

  • Leadership styles can be categorized as being authoritarian, democratic, laissez-faire, transactional, or narcissistic.
  • Authoritarian leaders keep strict control over their subordinates and keep a distinct professional relationship with their followers.
  • Leaders who embrace a democratic style of leadership guide and control and make key decisions when necessary, but otherwise share decision making with their followers, promote the interests of the group, and practice social equality.
  • Laissez-faire leadership is a “hands off” approach.
  • Narcissistic leadership is a common form of leadership and can be either healthy or destructive.
  • Transactional leaders motivate their subordinates by using rewards and punishments.

Key Terms

  • narcissistic: Obsessed with one’s own self-image and ego.

A leadership style is the manner and approach of providing direction, implementing plans, and motivating people. There are many different leadership styles that can be exhibited by leaders in politics, business, or other fields.


Leadership: A leadership style is the manner and approach of providing direction, implementing plans, and motivating people.


An authoritarian or autocratic leader keeps strict, close control over followers by closely regulating the policies and procedures given to followers. To maintain emphasis on the distinction between authoritarian leaders and their followers, these types of leaders make sure to only create a distinct professional relationship. They believe direct supervision to be key in maintaining a successful environment and followership. Due to fear of followers being unproductive, authoritarian leaders keep close supervision and feel this is necessary in order for anything to be done.


The democratic leadership style consists of the leader sharing the decision-making abilities with group members by promoting the interests of the group members and by practicing social equality. This style of leadership encompasses discussion, debate and sharing of ideas, and encouragement of people to feel good about their involvement. The boundaries of democratic participation tend to be circumscribed by the organization or group needs and the instrumental value of people’s attributes (skills, attitudes, etc.). The democratic style encompasses the notion that everyone, by virtue of their human status, should play a part in the group’s decisions. However, the democratic style of leadership still requires guidance and control by a specific leader. The democratic style demands the leader make decisions on who should be called upon within the group and who is given the right to participate in, make, and vote on decisions.


The laissez-faire leadership style was first described by Lewin, Lippitt, and White in 1938, along with the autocratic leadership and the democratic leadership styles. The laissez-faire style is sometimes described as a “hands off” leadership style because the leader delegates the tasks to the followers while providing little or no direction. If the leader withdraws too much, it can sometimes result in a lack of productivity, cohesiveness, and satisfaction. Lassiez-faire leaders allow followers to have complete freedom to make decisions concerning the completion of their work. It allows followers a high degree of autonomy and self-rule, while at the same time offering guidance and support when requested. The lassiez-faire leader using guided freedom provides the followers with all materials necessary to accomplish their goals, but does not directly participate in decision making unless the followers requests the leader’s assistance. This is an effective style to use when:

  • The followers are highly skilled, experienced, and educated;
  • The followers have pride in their work and the drive to do it successfully on their own;
  • Outside experts, such as staff specialists or consultants, are being used; and
  • Followers are trustworthy and experienced.

This style should not be used when:

  • Followers feel insecure at the unavailability of a leader.
  • The leader cannot or will not provide regular feedback to their followers.


The transactional style of leadership was first described by Max Weber in 1947, and then later described by Bernard Bass in 1981. Mainly used by management, transactional leaders focus their leadership on motivating followers through a system of rewards and punishments. There are two factors which form the basis for this system: contingent reward and management by exception. Contingent reward provides rewards (materialistic or psychological) for effort and recognizes good performance. Management by exception allows the leader to maintain the status quo; the leader intervenes when subordinates do not meet acceptable performance levels and initiates corrective action to improve performance.


Narcissistic leadership is a common form of leadership. The narcissism may be healthy or destructive, although there is a continuum between the two. To critics, narcissistic leadership (especially destructive) is driven by unyielding arrogance, self-absorption, and a personal egotistic need for power and admiration. A study published in the journal, Personality and Social PsychologyBulletin, suggests that when a group is without a leader, a narcissist often takes charge; researchers found that people who score high in narcissism tend to take control of leaderless groups. Freud considered “the narcissistic type… especially suited to act as a support for others, to take on the role of leaders and to… impress others as being ‘personalities’. ”

Technical Skills

Technical skills involve the process or technique knowledge, as well as proficiency, that may be needed in order to be a successful manager.

Learning Objectives

Identify the managerial need for technical skills

Key Takeaways

Key Points

  • The three managerial skills Robert Katz identified as being necessary to be a successful manager are technical, human, and conceptual.
  • Technical skills are easier to learn than human and conceptual skills.
  • Technical skills become less important at the top management levels of large firms as chief executives can use the technical abilities of their employees. However, high-level managers may still need these skills in smaller firms.

Key Terms

  • technical skill: the learned capacity or ability to carry out pre-determined results through tools, machines, techniques, crafts, systems, and methods of organization
  • conceptual skill: the ability to formulate ideas
  • conceptual: Of, or relating to concepts or mental conception; existing in the imagination.

To perform management functions and assume multiple roles, managers must be skilled. Robert Katz identified three managerial skills essential to successful management: technical, human, and conceptual. Technical skill involves process or technique knowledge and proficiency. Managers use the processes, techniques, and tools of a specific area. These are the specific skills and knowledge related to the individual’s profession or specialization. Examples include project management skills for engineers building bridges, aircraft, and ships. Technical skills include the ability to properly operate a computer, efficiently use the various software programs that are required in a particular environment, and the utilization of other electronic devices that pertain to the job function. These skills are especially important for lower level managers, as they are often responsible for training their subordinates.


Training surgical technical skills with simulation at Valdecilla: Technical skills are especially important for lower level managers, as they are often responsible for training their subordinates.

Katz pointed out that training programs tend to focus on skills in this area. These skills are easier to learn than those in the other two groups. Managers use the processes, techniques, and tools of a specific area. A manager’s level in the organization determines the relative importance of possessing technical skills. For instance, supervisors need technical skills to manage their area of specialty. As the pace of change accelerates and diverse technologies converge, new global industries are being created (e.g., telecommunications). Technological change alters the fundamental structure of firms and calls for new organizational leadership approaches and management skills.

At the top management level, conceptual and design abilities and human skills are especially valuable, but there is relatively little need for technical abilities. The assumption, especially in large companies, is that chief executives can utilize the technical abilities of their subordinates. In smaller firms, however, technical experience may still be quite important.

Conceptual Thought

Conceptual thought involves seeing the important elements in any situation and, according to Robert Katz, is the key management skills.

Learning Objectives

Explain the managerial need for conceptual skills

Key Takeaways

Key Points

  • People who are able to see the key elements in any situation can see the enterprise as a whole, see the relationship between the various parts, understand their dependence on each other, and recognize that changes in one part will influence the others.
  • Conceptual skills are likened to a “helicopter mind,” meaning that one is able to rise above a problem and see it in context.
  • These skills are not critical for lower-level mangers, gain importance for middle- management and are essential for the success of higher-level managers.

Key Terms

  • conceptual: Of, or relating to concepts or mental conception; existing in the imagination.
  • design: To plan and carry out (a picture, work of art, construction etc. ).

A scheme of management skills was suggested by Robert L. Katz (1986) in the Harvard Business Review. Katz, who was interested in the selection and training of managers, suggested that effective administration rested on three groups of basic skills, each of which could be developed. Katz saw conceptual skills as being the ability to see the significant elements in any situation.


Conceptual skills of a manager: Conceptual skills are probably some of the most important management skills.

Conceptual skills are probably some of the most important management skills. There are some very basic principles behind conceptual skills. The inputs by people who are hired especially for their exceptional conceptual skills often influence the decision-making process in an organization, be it about a simple thing like a change in the employees dress code, to something as big as a revamped advertising campaign for a product.

Seeing the elements involves being able to:

  • See the enterprise as a whole
  • See the relationships between the various parts
  • Understand their dependence on one another
  • Recognize that changes in one part affect all the others

This ability also extends to recognizing the relationship of the individual organizations to the political, social, and economic forces of the nation as a whole. This has since been called the “helicopter mind,” that is, being able to rise above a problem and see it in context. These conceptual skills are likely to be demonstrated by a manager or executive higher in the organization. Indeed, at these higher levels of management, organizations require these skills.

Conceptual skills are not critical for lower-level supervisors but gain in importance at the middle-management level. At the top management level, conceptual and design abilities are especially valuable

Analytical Mindset

Deriving, interpreting, and communicating patterns within data allows managers to make informed strategic and tactical decisions.

Learning Objectives

Understand the value of analytical thinking as it pertains to management, and recall the various perspectives of analysis

Key Takeaways

Key Points

  • A strong sense of analytical understanding is a highly useful skill set in both business and science.
  • Pursuing objective information to drive data-driven decisions requires a highly developed analytical skill set, and is a critical component of managerial decision-making.
  • Analytics can be used to assess and visualize decisions, describe the implications of historical data, predict and model future expectations, and optimize internal processes.
  • In the age of big data, the importance of analytics has never been higher. The ability to navigate and derive value from big data is critical to successful organizational management.

Key Terms

  • cherry-picking: To pick only a part of the whole truth, often in order to support an opinion or personal agenda. In analysis, it is seeing what one wants to see in the data (as opposed to what’s there).
  • analytics: The derivation, interpretation, and expression of patterns within data sets.

Defining Analytics

The derivation, interpretation, and expression of patterns within data sets is referred to as analytics. This broad definition can fit numerous contexts, and is highly relevant in virtually every modern field of business and science. There are many instances in a business environment where analytical thinking skills are applied to produce meaningful observations. In fields from marketing to operations to finance to strategic decision-making, managers must both understand and employ analytical skills to succeed in the modern business environment.

This image is an excellent illustration of how information from the operational environment translates into meaningful data, information and ultimately intelligence for decision-making.

Analyzing the Operational Environment: This image shows how information from the operational environment translates into meaningful data, information and ultimately intelligence for decision-making.

How to be Analytical

Strong analytical skills are as much a developed competency as they are a perspective. Pursuing objective, fact-based decision-making and data-driven conclusions requires a commitment to an analytical mentality. Pushing gut feelings and intuition into the background in favor of framing issues through analysis is a constant struggle in nearly every organization. It is a critical role of management to ask the right questions and align employee behavior with analytical thinking.

Depending on the particular role, industry, organization and objectives, a manager may use one or more of the following analytical models to frame tactical and strategic questions:

  • Decision analytics – Using data-driven models and visualizing outcomes of specific organizational behaviors can enable managers to visualize the various outcomes of different strategic approaches.
  • Descriptive analytics – Collecting historical data from reporting, scorecards, clustering and various other sources of information, managers can underline trends and identify opportunities and/or risks.
  • Predictive analytics – Leveraging statistical models and machine learning, managers can predict future outcomes with varying degrees of statistical confidence.
  • Prescriptive analytics – Using optimization and simulation, managers can produce recommended decisions through analytical modeling.

Domains of Analytics

  • Behavioral analytics
  • Cohort Analysis
  • Contextual data modeling
  • Enterprise Optimization
  • Financial services analytics
  • Marketing analytics
  • Pricing analytics
  • Retail sales analytics
  • Risk & Credit analytics
  • Supply Chain analytics
  • Talent analytics
  • Transportation analytics
  • Customer Analytics

More Important Now Than Ever

In the current technological environment of big data, analytics has never been more relevant and central to the organization. With endless data available, it is easier than ever to derive advantage or make substantial mistakes in digesting this data. Indeed, utilizing analytics incorrectly can be just as disastrous as not using it at all! In a world with this much data, maintaining objectivity and refraining from cherry-picking to prove one’s opinion is a very important skill.

Managers must be owners not only of the decisions they make, but the validity of the process in which they make them. Analytics is the core skill set required for success in this domain, arguably the most important facet of management.

Sensitivity to Human Relations

Good managers have an innate sensitivity to the needs of the people they manage, and a highly developed emotional intelligence.

Learning Objectives

Integrate emotional intelligence and human resource needs into the broader field of management

Key Takeaways

Key Points

  • Management is primarily the task of aligning internal resources to create efficient production processes. These resources are often human resources with complex emotional needs.
  • Strong managers have an innate sensitivity to human resource needs, which is enabled by a high level of emotional intelligence (EQ).
  • EQ can be defined in a variety of ways. Central to EQ is communication, courtesy, interpersonal skills, positive attitude, and a strong sense of teamwork.
  • To create a comfortable working environment for employees, managers should focus on motivating, setting goals, delegating and communicating effectively.

Key Terms

  • Interpersonal skills: The competencies related to human interaction, such as social skills, communication, and emotional intelligence.

Management is a functional discipline that requires a wide variety of skill sets, including organizational skills, technical skills, and people skills (or ‘soft skills’). Effective management is often centered around people skills, as the resource being managed is primary the effort of human resources.

As a result, managers who are sensitive to human resources are much more likely to be successful in a leadership role.

Soft Skills and Emotional Intelligence

The skills required to lead from a human sensitivity perspective are often referred to as soft skills or EQ (emotional intelligence). According to a research done at Eastern Kentucky University, soft skills can be summarized as the following ten attributes:

  1. Communication – Speaking, writing, presenting, and listening
  2. Courtesy – Showing appropriate respect and pleasantries when dealing with others
  3. Flexibility – Both adaptable and teachable, good managers can fill the unique needs of each employee they manage through changing their own habits
  4. Integrity – Understanding the ethical implications of decisions is integral to success
  5. Interpersonal skills – This is an extensive list of characteristics involving social ability, friendliness, sense of humor, patience, etc.
  6. Positive attitude – A confident and upbeat personality tends to trickle down through work groups
  7. Professionalism – Reliability and professionalism go hand and hand, and showing a strong sense of professionalism can emotionally reassure employees
  8. Responsibility – A willingess to take credit for the team ‘s mistakes and a willingness to give the team credit for their successes is a key component of responsible management
  9. Teamwork – Mangers must be collaborators, capable of filling the many roles required in a team
  10. Work ethic – Finally, management is hard work, and strong work ethic sets a good example.

As you can see here, the vast majority of these skills involve integrating with human resources. High performing managers are sensitive to the needs, emotions, perspectives,and well-being of the individuals they are managing.

How to Manage Sensitively

With the above core skills in mind, managers with a strong sense of human resource sensitivity focus on managing people via the following four phases:

  1. Motivating – Understand what your employees are good at, and what they enjoy. Let them know they are appreciated for their skills and attitude and ensure they have everything they need to succeed in their role.
  2. Setting Goals – Create agreement among the team regarding direction, and identify practical objectives that won’t overburden or intimidate team members. Offer feedback, and receive feedback in turn. Ensure that feedback maintains a positive note.
  3. Delegating – Managers must take on the functional role of delegation. This simply means dividing tasks among the work group, and letting each individual know what is expected of them and how they will contribute. Give employees credit for their successes, and as a manager it is on you to take responsibility for any failures.
  4. Focus on Communication – Communicating well and avoiding misunderstandings will save time and stress. Make sure tasks are clear and feedback channels are open. Listen carefully and clarify what you’re hearing. Take an active interest in your employees.

Through focusing on these core human relations activities while managing, employees are likely to have the clarity, confidence, and commitment required to succeed in the workplace.

Much of a leaders responsibilities lie in managing and motivating externally. This is to say that leaders are not only defined by their internal competencies, but more importantly by their ability to translate these competencies externally.

The Three Levels of Leadership: Much of a leader’s responsibilities lie in managing and motivating externally. This is to say that leaders are not only defined by their internal competencies, but more importantly by their ability to translate these competencies externally.

Source: Business