Murray Voth: The difference between a manager and a leader

by | Jan 7, 2019 | 0 comments

The Automotive Shop Manager Job Description

As a business owner it is important to learn how to become a good manager and an effective leader.  Many people see these two roles as one and the same, but they are very different.  I believe that a person can be a leader without being a manager and a manager without being a leader. I do think that most good leaders have management experience; it adds wisdom to their leadership, but many managers who are promoted to leadership do poorly without the proper training. There are also very good managers that are not leaders by title, but in many cases provide some form of leadership. And though I would say that most of you function in both roles, I would like to define them. 

Management is an operational function; it is about keeping complex processes functioning and producing their intended results. 

Leadership is about finding and setting direction, it is about providing hope and competence to the people in the organization. In simple terms, leadership creates the vision and management carries out the mission. Typically, managers manage things, systems and procedures. Leaders lead people.

These are your responsibilities as a manager. This is the same list whether you are an owner or an employee managing the business.

1. As a manager it is your job to operate the business in such a way that the company makes a profit for the shareholders. This profit should provide the return on investment of the capital employed in this enterprise. This includes growing the business. This means that you must understand how to measure the business by generating and reading financial reports. You need to understand industry benchmarks and key performance indicators. And you must source and provide and train the systems and procedures required to attain these benchmarks and key performance indicators. You will need to budget and forecast, sales, cost of sales, gross profit, expenses, key performance indicators and net profit.

2. As a manager it is your job to operate the business in such a way that the employees are engaged and focused. You will need to create the positions within the company that fulfill the operational roles.  This includes description of the roles and wages. It is your responsibility to attract and retain the right employees. This includes providing training, an evaluation process, good accountability, and an overall approach to employee engagement and development.

3. As a manager it is your job to optimize the resources (including assets) required to operate this business. You will ensure that all the company-operating expenses and accounts payable are paid in a timely fashion and that accounts receivables are managed and collected, and taxes are remitted. You will be required to manage cash flow, bank deposits, daily, weekly, and monthly reconciliations.

4. You will research and source the required tools, equipment, training, software and computers needed to operate the business. This will include understanding and managing depreciation, retained earnings, and creating capital budgets and spending plans.

5. You will meet with suppliers to negotiate best pricing and service for the business. This is a mutually respectful meeting, finding ways for both sides to win.

6. You will need to manage and control the expenses (costs) of the business to ensure that the business can operate effectively yet not waste or over spend.

7. As a manager it is your job to operate the business in such a way that your customers are satisfied (feel like they have received value as they perceive it, and have made informed decisions), are receiving the value they paid for, are returning for future business. And are referring their friends and family. All of this includes marketing, social media, and customer relations management.

As you work on growing your leadership and management skills you will grow in your ability to delegate responsibilities and duties.  Please note that there is a difference between delegating “things” that need to get done and “decisions” that need to be made.  As your company grows, you are going to need to develop this ability, along with the ability to “let go” and hold those you delegate to, accountable.

You will also need to spend time and effort on your own professional and personal development.  This includes taking training yourself, reading books and materials related to both personal and professional growth.  You will need to join an accountability group, such as a 20 group or mastermind group.

It is important that each owner, leader and manager understand that at the core, every successful business is fundamentally a collection of these 5 interdependent processes, each of which flows from one to the other:

1) Value Creation – Discovering what people need, want, or could be encouraged to want, then creating it.

2) Marketing – Attracting attention and building demand for what you’ve created.

3) Sales – Turning prospective customers into paying customers by completing a transaction.

4) Value Delivery – Giving your customers what you have promised and ensuring they are satisfied with the transaction.

5) Finance – Bringing in enough money to keep going and make your effort worthwhile. It is important that each owner, leader, and manager clearly understands and can communicate the purpose of his or her business to their employees, customers, and society in general.

It is important that each owner, leader, and manager clearly understands and can communicate the purpose of his or her business to their employees, customers, and society in general.  

Murray Voth, RPM Training


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