Construction Business Management and Leadership

Understand the difference in leading and managing your construction business in this creative economy.

Leadership and management are terms that are often used interchangeably, as if describing the same thing, and yet, the difference between the two in today’s service-based, creative economy couldn’t be greater. In my two decades of experience in enterprises of all sizes, I have witnessed the increasing polarity between management and leadership and the associated impact on performance. This is more than just the difference between thriving and surviving. I believe the biggest threat to organizational performance today is not the marketplace, the economy or the competitive landscape; I believe a far more subtle, hidden threat lies within the business. I’m referring to the fact that the vast majority of organizations today are rich in managers and poor in leaders.

Why is this such a problem? To begin to answer the question, we first need to explore the differences between leadership and management in relation to the employee experience. If any business is to successfully navigate the unprecedented waters of this complex and fast-changing economy, then it should start making an impact at the cause of performance, instead of not spending time, money and energy on the effects of it.

For example, the client experience is not king. It’s the employee experience that is king, because it’s the employee experience that shapes the client experience. It’s not just about those frontline employees who “touch” the client either. In an economy where competitive differentiation is, paradoxically, not found in competitiveness but in collaboration, and the traditional boundaries of organizations are becoming increasingly blurred, it’s the quality of service from the entire organization, the enterprise “attitude” if you like, that makes the difference.

If the quality of the employee experience is king, then what defines it? It’s the behaviors and skills of those people occupying influential positions in the business. Notice, I mentioned occupation of the position. When it comes to influence, which is the primary difference between management and leadership, occupation of any position doesn’t constitute competence in the role. Leadership is a personality issue, not a positional one. No position can make a leader; it takes a leader to make the position.

There is a lot of evidence regarding the “natural” influence (good or bad) that those occupying leadership positions can have on the behavior and performance of the organizations. In fact, if you “unpeel the onion” of any enterprise of any size, you’ll find that top and bottom-line results are in direct correlation to the thought, feelings, actions and behaviors of those in leadership positions. That brings us back to the difference between management and leadership in experience.

The practice of management maintains the status quo, leadership challenges it. Management measures the effects of performance; leadership develops at the cause of it. People don’t want to be managed; they want to be led; inspired rather than motivated to go beyond their existing performance levels.

There’s a lack of equilibrium in business today, with far too much emphasis on measurement and far too little emphasis on growth. What’s the point in measuring anything unless it’s growing? Talented employees may expect to be measured by employers today, however, it’s growth they crave.

Business performance is truly autobiographical. If you help your employees grow personally and professionally, that in turn manifests itself onto the bottom line. It’s about influencing the cause of performance, not measuring the effects. As William Authur Ward put it so eloquently, “Wise are those who learn that the bottom line doesn’t always have to be their top priority.” That takes leadership, not management.

These are unprecedented times, and companies planning to thrive rather than merely survive need to think differently to get results.  Management can maintain a direction but often can’t change it. Systems, processes and measurements can only do so much. To respond to a fast-changing and complex marketplace, you need the ability to move your employees in a new direction, and that requires leadership at every level of your company.

Take an honest appraisal of your business, and begin with yourself. What portion of your time do you spend influencing and coaching others for performance versus measuring it/them? This is time to be ruthlessly honest. Now, do the same for the rest of your business.

Do you have a measurement culture or a performance culture? How do your colleagues conduct themselves one-to-one and through other interactions with their employees? Is there a spirit of growth and an interest in developing the person, or is the development work left for the spreadsheet? Assess you performance climate, conduct a survey with your employees asking them if they feel they are being coached and growing personally by working in your business or team.  Your willingness to spend time assessing whether your business is leading or managing will pay you dividends should you be willing to act upon the findings.