Leadership is a term used in a variety of different ways, although it can be defined as the ability to lead others toward a common goal. Leaders also come in many different forms and can operate at any level, so the ability to identify and develop leaders can be challenging. Yet, when done correctly, leadership can bring about positive outcomes for people, businesses, and wider communities. This is why it’s important to adapt the approach to developing leaders to fit the current needs of an organisation, as well as invest in environments that enable leaders to be effective.

This factsheet investigates the concept of leadership and how it differs from management, explores the various factors that can influence leadership development, and briefly examines how a principles-based approach to practice can support the development of leadership skills in HR.

In times of great change and uncertainty, effective leadership becomes even more vital to ensure that everyone in the organisation is driven by a common goal. However, it’s difficult to define a universal set of leadership behaviours that guarantee such a shared purpose. Much more emphasis is put onto finding and developing leaders who can make the right decisions whatever the circumstances, following an internalised set of ethical principles.

Despite a significant investment in developing leadership and management capability, lack of good leaders is still a concern for organisations. Organisations, and more specifically the HR function, need to adopt a more holistic approach to leadership development. First, they need to define the specific kind of ‘leadership’ that their organisation needs now and in the future, looking not only at the individual competencies, but also at leaders’ values, the way leadership happens in an organisation, and the desired individual and organisational outcomes. Secondly, they need to ensure that leaders at all levels in an organisation receive adequate training to deliver on their objectives. Finally, through organisational design and development, they should align organisational systems and structures to support managers and employees in deploying their leadership capability.

Leadership can be defined as the capacity to influence people, by means of personal attributes and/or behaviours, to achieve a common goal. However, while leadership is currently much discussed and academic studies have multiplied since the 1970s, there’s no single definition or concept of leadership that satisfies all. The following three aspects of the nature of leadership have important implications for organisations.

Who are the leaders?

Originally, studies of leadership focused on the traits or behaviours of individuals occupying senior positions in organisations, and, as a result, leadership is often seen as an individual competence or a role. But leadership isn’t just about the qualities of a few, and isn’t always associated with a formal managerial role, although the leadership skills of chief executives and their teams are fundamentally important.

As the twenty-first century business context is requiring organisations to become more agile, there’s been an increasing recognition that all employees, including middle managers, first-line supervisors, and front-line staff, need to be leaders at some level, although the aims and focus of leadership may change with the organisational level and differ from one organisation to another. This need for leadership across all organisational levels is highlighted in our research on sustainable organisation performance.

What is an effective leadership style?

Experience suggests that successful leaders don’t invariably behave in identical ways. They may act very differently, even in similar situations, and have quite different personalities. Different leadership qualities may be needed in different circumstances. To take an obvious example, Winston Churchill was a great wartime leader but less successful in peacetime. Similarly, CEOs who excel in turning round ailing companies may perform less well when things are more stable.

Is leadership a process?

As insights into the nature of leadership and the effectiveness of leaders have developed, it’s clear that individual traits or behaviours alone cannot fully explain leadership effectiveness. More research into the role of followers and the quality of the relationship between leaders and followers is now available, although the precise mechanisms of the mutual influence aren’t fully understood. With that in mind, leadership has been described as a process, or as a capability of the organisation (rather than individual), emphasising the interplay of leaders, followers, and the organisational context that impact leadership effectiveness.

The idea of management that evolved in the nineteenth century, and was later developed into theories by F.W. Taylor, was largely based on the military principles of command and control. Managing was, and to some extent still is, about the planning, organisation, co-ordination and implementation of strategies, tactics and policies imposed from the top in an apparently rational manner. Administering a strategy is central to this view of management. Later studies of management, which looked at the behaviours of those in managerial roles, distinguished between ‘managing tasks’ and ‘managing people’, and acknowledged that influencing people to achieve objectives (leadership) was part of a manager’s role.

Due to the initial focus of leadership research at the senior manager level, ‘leadership’ and ‘management’ are linked and sometimes used interchangeably. At the heart of many interpretations, leadership is deemed to involve developing an initial vision and inspiring others with an overview of how that vision may be achieved, while management involves translating the vision into reality by guiding the actions and behaviours of a group of people on a day-to-day basis. A review of the value of various leadership styles suggests that both aspects of what leaders do day-to-day have a part to play in achieving business objectives.

New theories of ‘ethical leadership’, focussed on possessing certain core values alongside a sense of purpose, are another trend driven partly by the ‘soul searching’ that has developed in the wake of the recent global financial crisis. These leadership approaches acknowledge that in the context of uncertainty in the world of work, it’s essential that leaders hold to a set of principles that allow them to make ’right’ and ’worthwhile’ decisions regardless of circumstances. Ongoing shifts in corporate governance in particular are driving leaders to articulate these principles and make decisions in an ethical way.

Most leadership studies focus on the ways leaders are seen by followers, measuring employees’ perceptions of their leaders’ behaviours, and linking those to followers’ accounts of job satisfaction, performance and other outcomes. Our Purposeful leadership research considered the moral values to leaders themselves, defining the concept of ‘purposeful’ leadership through a leader’s moral self, their commitment to various stakeholder groups, and the vision they set for their team.

Key findings of the research:

  • Only just over 20% of managers in the UK rate themselves highly as purposeful leaders, while 40% of employees in the UK say their leader behaves ethically.
  • Across the case study organisations, a third of employees say they are operating in an ‘ethical void’ where they rate both their leader’s ethical behaviour and the alignment of their own values with those of the organisation as low. By comparison, just over a quarter report ‘ethical alignment’ and score highly on both.
  • Purposeful leadership is linked to employees’ job satisfaction, meaningfulness of work, willingness to go the extra mile, intention to quit, sales performance and lower levels of cynicism towards the organisation. In many cases, these links were significant over and above the effects of employees’ perceptions that their leaders behave ethically, suggesting that leaders’ moral character makes a difference to employee outcomes.

Because there’s no single template for leadership behaviour, questions remain as to whether leaders can be developed and what the qualities (or competencies) of leadership are. More importantly, how can organisations bring out such qualities among their employees?

Following the distinction between individual leaders and their particular styles of leading, and leadership as a process existing in the organisational context, two aspects of development activity are needed. The first is in identifying and developing capabilities of individuals to lead others effectively (leader development). The second is creating organisational structures and a culture that enable leadership.

Development of individual leaders

Organisations can undertake a range of activities to maximise an individual's capability to lead. Our management development factsheet looks at identifying management development needs and the techniques involved in developing leaders and managers.

Selecting individuals with leadership capability and the potential to develop such capability comes under the umbrella of succession planning. Organisations have a range of methods to define and measure the leadership capability of individuals which is needed by the organisation in the short- and long-term, although reports on leadership capability consistently highlight skills gaps, and in particular the leadership skills required in the future.

Many organisations provide sets of activities to develop the leadership capability of individuals through training and experience. Despite the clear business case for line managers also to be leaders, many organisations promote people in managerial roles based on their technical competence, as opposed to leadership skills. These individuals are likely to require further formal and/or informal training to be effective leaders. Organisational approaches to leadership development differ in the behaviours companies believe to be supporting the business strategy, as well as the learning methods used to develop leaders. Our report Developing managers to support employee engagement, health and well-being collected the latest evidence on designing successful manager development programmes.

Many current leadership theories pay particular attention to leaders’ values. Corresponding leadership development approaches focus on identifying and developing individuals that display honesty, integrity and strongly held moral principles, and translate them into behaviours of leading others. Our research report Cultivating trustworthy leaders has shown how some organisations have used value-based approaches to recruitment and development, in order to encourage employees’ trust in their leaders

Relevant experience is an important part of individual leader development.  Our research produced in association with talent management specialists DDI has highlighted that ‘leadership transitions’, or the stages when leaders’ responsibilities, time allocation and priorities change as a result of promotion, introduce particular challenges. This is where leadership development overlaps with a number of other issues.

Organisational design and development to enable leadership

Leadership is increasingly viewed as a collective phenomenon or a process. For example, a shared or distributed leadership model suggests that leadership can be shared by team members, with the role of a leader taken up when required, involving lateral influence and directed by the team dynamics. However, this requires that the organisation structures and the organisational culture support the understanding of leadership not as an individual characteristic, but as a process that happens between people.

Our research reported in Leadership – easier said than done has shown that even where individuals have leadership skills, their ability to lead in practice is impacted by a range of organisational factors, including hierarchical structures, performance management systems and other people management policies and practices. Practitioners can bridge the gap between leadership capability and ability to lead through organisational development activities, by aligning the design and culture to enable leadership – see our report Tackling the barriers to leadership overview and case studies or listen to our podcast on barriers to leadership.

See more on organisation design and organisation development in our factsheets.

Our Profession for the Future programme highlights the need for leadership in the HR profession as organisations increasingly realise the value of their people, but have not yet developed sustainable approaches to fostering productive, win-win relationships between the business and its workforce.

In the past, practitioners have been able to rely on so-called ’best practice’ to develop people management practices for their organisations, but the rapidly changing world of work means this concept is increasingly irrelevant in many contexts. Instead, professionals will be making situational judgments, underpinned by relevant evidence, which will allow them to meet the specific needs of their particular organisation and workforce without compromising the core principles of good HR. Our research investigates how other professions are adopting similar principles-based approaches to practice, and provides an early indication of what the principles for people management and development practice could be. It encourages HR practitioners to act as ‘provocateurs’, encouraging innovative ways of doing business or new areas of strategic focus.

Books

BOLDEN, R., WITZEL, M. and LINACRE, N. (2016) Leadership paradoxes: rethinking leadership for an uncertain world. Abingdon: Routledge.

DEPARTMENT FOR BUSINESS, INNOVATION AND SKILLS. (2012) Leadership & management in the UK - the key to sustainable growth : a summary of the evidence for the value of investing in leadership and management development. London: Department for Business Innovation and Skills.

GOLD, J., THORPE, R. and MUMFORD, A. (2010) Leadership and management development. 5th ed. London: Chartered Institute of Personnel and Development.

HOLBECHE, L. (2010) HR leadership. Oxford: Butterworth Heinemann.

LADKIN, D. (2011) Rethinking leadership: a new look at old leadership questions. Cheltenham: Edward Elgar Publishing.

TATE, W. (2013) Managing leadership from a systemic perspective. London: Centre for Progressive Leadership. Links to 

WATSON, G. and REISSNER, S.C. (2014) Developing skills for business leadership. 2nd ed. London: Chartered Institute of Personnel and Development.

Journals

BEDDOES-JONES, F. and SWAILES, S. (2015) Authentic leadership: development of a new three pillar model. Strategic HR Review. Vol 14, No 3. pp94-99.

FERNANDEZ-ARAOZ, C., IQBAL, S. and RITTER, J. (2015) Leadership lessons from great family businesses. Harvard Business Review. Vol 93, No 4, April. pp82-88.

GINO, F. and PISANO, G.P. (2011) Why leaders don't learn from success. Harvard Business Review. Vol 89, No 4, April. pp68-74.

KNIGHTS, D. and McCABE, D. (2015) ‘Masters of the Universe’: demystifying leadership in the context of the 2008 global financial crisis. British Journal of Management. Vol 26, No 2, April. pp197-210.

LOVEGROVE, N. and THOMAS, M. (2013) Triple-strength leadership. Harvard Business Review. Vol 91, No 9, September. pp46-54,56.

WATKINS, M.D. (2012) How managers become leaders. Harvard Business Review. Vol 90, No 6, June. pp65-72.

CIPD members can use our online journals to find articles from over 300 journal titles relevant to HR.

Members and People Management subscribers can see articles on the People Management website.

This factsheet was last updated by Ksenia Zheltoukhova.

Ksenia Zheltoukhova

Ksenia Zheltoukhova: Head of Research 

Ksenia is responsible for leading research innovation and capability development at the CIPD. She joined in 2013 as a Research Adviser, leading a number of projects, including a major research programme, Profession for the Future, investigating principles-based approach to professional standards as a way of driving ethical and sustainable decision-making by the business.

Prior to the CIPD, Ksenia was a researcher at The Work Foundation, working on Future of HR, Leadership, and Health and Well-being streams. With a background in organisational psychology, she holds a PhD in Management from Lancaster University, where her research examined the effects of leaders’ sacrificial behaviours on followers.


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