What is Leadership in Business?

Becky Leighton

Posted: March 19, 2019

Table of Contents

leadership in business

How does a business maintain its vision? Through good leadership. Effective leadership in business management helps with goal achievement and ensures productivity. Leaders make sure that everyone’s roles are clearly defined while meeting business objectives.

What is leadership?

The term ‘leadership’ means something different to everyone. For some, it conjures up images of a political leader or business executive. Many think leadership means seniority, but generally, it really means guiding someone – in the right direction – towards a better result.

Here’s how to spot a leader:

Leads by example

If they are enthusiastic about something, people around them will mirror their attitude. How they approach a situation will inspire others on how to manage a specific scenario.

Listens more

They speak less and listen more. This encourages open communication and could lead to effective results.

Is a team player

Someone who is willing to ‘get down in the trenches’ with everyone else shows fairness and a willingness to achieve a great

Qualities of a good leader

Like any good craftsmen, a good leader also needs a set of tools in their arsenal to help them make a positive impact.

Effective communication

To make sure that everyone is on the right track, the leader will need to communicate what is needed. It’s important for everyone to be on the same page and have an understanding of the requirements. Communication doesn’t mean verbalising instructions but also being exceptional at non-verbal skills. This all boils down to body language and eye contact. People usually gain a first impression of someone before they speak. Non-verbal cues speak volumes.

Good motivator

There are leaders that drive their team to hard work and there are others that cheer them. The latter is the one that achieves effective results. Why? The team witnesses a person who has commitment and passion, which inspires them to work hard. This inspires everyone to do great work.


There will be times when a challenge occurs. What separates a good leader from the bad is how these individuals manage obstacles. This involves creative thinking. A good leader is open to varying approaches to achieve the same goal. They do this while showing professionalism and confidence.


An open and collaborative environment encourages transparency and is less hostile. A relationship based on trust demonstrates that the leader will always be honest with them every step of the way. A team with a good support system works in harmony and will achieve a positive outcome.


Making the right decision can have a profound impact. A leader should be able to be analytical and have critical thinking to reach a successful outcome. Decision-making capabilities mean listening to others’ ideas, embracing differing perspectives and sound judgement to reach a conclusion that will help the end-goal.

Why leadership is important in business management

Having a good leader managing a business is important. The leader needs to ensure that the requirements of internal and external stakeholders are met. The leadership within an organisation needs to ensure the following:

Maintain the vision of the business

A business leader needs to guarantee that the business is working like a well-oiled machine and that it’s not steering away from its vision. This means ensuring that each department is functioning as it should and that there is an ample amount of resources available. Nobody should lose track of the big picture.

Communicate and manage business strategies

One of the important steps after strategy creation is implementation. The role of the leader is important because every level of the business needs to know what role they’ll be playing. The end goal needs to be clearly established and defined. This is easy with effective communication skills. Again, it’s not about verbalising instructions but making sure that the team understands what role they play.

Build morale

Employees are more productive if they are in a positive environment. This starts with leadership. If the team is too stressed, job performance and productivity will start to decline. A good leader will inspire the team to work hard but also maintain morale within the company. The result is high employee retention and a team that is highly motivated.

How do I gain leadership skills?

Most think that you are born with leadership skills but there are ways to develop them. To start off, you need to learn what leadership style suits your personality. A good leader also needs to practice discipline – whether it’s in your personal or professional life. Honing these skills through work experience is a great start.

Various short courses also provide insight into modern management approaches that could advance your career.

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