Leadership and management 101

May 15, 2020. Straight from my lecture notes, always posted online for students, after class. Phot is from one of my final graduate classes, spring 2019.

Management refers to values and behaviors. Key management values are the creation of (1) wealth, (2) customers (ormarkets), and (3) a sustainable development advantage, meaning the ability to identify, innovate and maintain a lasting competitive position in the market. Management is stewardship; managers are stewards. Management is the application of behavioral economics, i.e., the stewardship of scarce, important resources for people.

Management requires intuition, data, and analytical skills to solve problems and to make decisions. The management process starts with identifying and structuring a problem, then proceeds to decision making, usually to leading, and finally to auditing or examining the results of the process, to see how well results meet the intentions or goals. These are the planning, organizing, leading and controlling processes, respectively.

Management is about the responsible stewardship of resources, using resources to pursue management values of wealth creation, customer satisfaction and sustainable development. The Project exercise was developed as a management training exercise, as a basic test of management intuition. Experts developed this exercise to train scientists and engineers who were promoted to take on project management responsibilities, to assume management of a large project. To these technically trained people, management was a new task, requiring new skills. Management is about purpose as well as process. The purpose of management planning is to choose the right things to do (effectiveness) and then to do them correctly (efficiently). Both effectiveness and efficiency are important for building a sustainable comparative advantage, but that does mean that efficiency and effectiveness are correlated.

The process of management starts with an assessment of relevant data and environmental; conditions, to create an understanding of the context for any management decisions. The alternative to this approach would be to operate in what can be humorously described as “the data-free zone,” where managers make decisions based on assumptions, opinions, perceptions and beliefs, rather than on data, evidence, information and reality. The management process then starts with planning, before moving next to organizing resources, then to directing (or leading) people in the work and concluding with exercising control over the results.

Management is about effectiveness (“doing the right things”) and efficiency (“doing things right”). The Project exercise data provide measures of individual management intuition, team effectiveness, and personal leadership. There is a right way and a best way to get effectively and efficiently complete a project. The correct order of tasks follows. The boldfont highlights links to the management and leadership behaviors described above.

Twenty steps to managing a project to completion.

1. PLAN. Gather and analyze the facts of the current situation.

2. Set the overall project objectives.

3. Develop possible alternative courses of action. [Develop possible options.]

4. Identify the possible negatives of each alternative. [Avoid worst-case scenarios.]

5. Decide on a basic course of action for the project. [Choose an option/path to pursue.]

6. Develop your project’s strategy and major priorities.

7. Determine checkpoints for intermediate review. [Set intermediate goals.]

8. ORGANIZE. Identify all the tasks needed to complete the project.

9. Define scope and authority of each team position. [This is a job analysis.]

10. Establish the qualifications for each team position. [This produces job descriptions.]

11. Allocate financial resources for the project. [Decide where to spend your resources.]

12. Find qualified people to fill the team positions.

13. Train/prepare members for team responsibilities.

14. Set individual performance goals for team members.

15. Assign authority/responsibility. [Bes sure to match authority to responsibility.]

16. LEAD. Manage and coordinate ongoing team activities. [Lead and direct the work.]

17. CONTROL. Measure your team’s progress toward project goals.

18. Compare individual work to individual objectives.

19. Take corrective action on project and recycle plans.

20. Provide rewards for individual performance.

Leadership is the management of human behavior; management is responsibility for resources, e.g., time, money, other assets. Leaders lead people. Not all managers are good leaders, not all leaders are good managers, and some managers don’t need to lead. Leadership is systematic, purposeful influence. Leaders understand the theory and practice, the art and a science, and the mental and physical of leading and managing.

Leadership – systematic purposeful influence – can move people in the right or wrong direction. While there are many theories as to what constitutes ‘leadership,’ for our purposes we will focus on leadership as a systematic, strategic application of behaviors and methods by the person asserting influence in a positive way, on herself or others. The seven key behaviors are as follows:

1. Articulate and enacting a vision.

2. Establishing clear goals.

3. Providing positive models.

4. Developing employee and leader self-efficacy.

5. Using positive reinforcement, i.e., good performance earns rewards for the performer.

6. Using a constructive form of punishment, primarily reprimand and correct, to correct mistakes, errors or deficiencies with future performance.

7. Empowering the creative and physical energy of teams of people, providing maximum vision and minimum supervision, along with adequate resources, support and coaching.

Leadership can work towards positive or negative outcomes. Leaders can also have a narrow focus on a few people or abroad sense of purpose, to serve many people. Prosocial leadership means effectively influencing many people in the right direction. When leaders act to further a greater, common good, they practice prosocial leadership. This externally directed, positive behavior towards the greater, common good is more than altruism, kindness, empathy, charity, service or social responsibility.