Managers and Leaders • HBR C LASSIC
limited options. He could then authorize the
car division’s general manager, with whom he
basically agreed, to move quickly in designing
water-cooled cars for the immediate market
demand.
Years later, Sloan wrote, evidently with
tongue in cheek, “The copper-cooled car never
came up again in a big way. It just died out; I
don’t know why.”5
To get people to accept solutions to problems, managers continually need to coordinate
and balance opposing views. Interestingly
enough, this type of work has much in common with what diplomats and mediators do,
with Henry Kissinger apparently an outstanding practitioner. Managers aim to shift balances of power toward solutions acceptable as
compromises among conflicting values.
Leaders work in the opposite direction.
Where managers act to limit choices, leaders
develop fresh approaches to long-standing
problems and open issues to new options. To
be effective, leaders must project their ideas
onto images that excite people and only then
develop choices that give those images substance.
John F. Kennedy’s brief presidency shows
both the strengths and weaknesses connected
with the excitement leaders generate in their
work. In his inaugural address he said, “Let
every nation know, whether it wishes us well
or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend,
oppose any foe, in order to assure the survival
and the success of liberty.”
This much-quoted statement forced people
to react beyond immediate concerns and to
identify with Kennedy and with important
shared ideals. On closer scrutiny, however, the
statement is absurd because it promises a position, which, if adopted, as in the Vietnam War,
could produce disastrous results. Yet unless ex-
Retrospective Commentary
It was not so long ago that Bert Lance, President Jimmy Carter’s budget director and confidant, declared, “If it ain’t broke, don’t fix it.”
This piece of advice fits with how managers
think. Leaders understand a different truth:
“When it ain’t broke may be the only time
you can fix it.”
In the splendid discipline of the marketplace, past formulas for success today contain the seeds of decay. The U.S. automobile
industry has been cited so often as the prime
example of the suicidal effect of continuing
to do what one has been doing in the wake of
success that its story borders on the banal.
But it’s true. Top executives in the automobile industry, along with managers in many
other industries in the United States, have
failed to understand the misleading lessons
of success, revealing the chronic fault of the
managerial mystique.
As a consequence of placing such reliance
on the practical measure of continuing to do
today and tomorrow what had proven successful yesterday, we face the chilling fact
that the United States’s largest export during
the last decade or more has been jobs. We
live with the grim reality that the storehouse
of expertise called know-how has diminished.
Perhaps most dismal of all, our children and
harvard business review • march–april 1992
our children’s children may not be able to
enjoy the same standard of living we worked
so hard to achieve, let alone enjoy a higher
standard of living as a legacy of the generations.
When “Managers and Leaders: Are They
Different?” first appeared in HBR, practicing
managers and academics, including many of
my colleagues at the Harvard Business
School, thought I had taken leave of my
senses. Don’t ordinary people in an organization with superior structure and process outperform superior people operating in an ordinary organization? To those indoctrinated
in the “managerial mystique,” talent is
ephemeral while organization structure and
process are real. The possibility that it takes
talent to make a company hum counts for
less than acting on those variables managers
feel they understand and can control.
Talent is critical to continued success in
the marketplace. Yet most organizations
today persist in perpetuating the development of managers over leaders. Fortunately,
however, there may be an awakening. The
chairman of IBM, John Akers, startled the
business community with his announcement
that IBM intended to abandon its long-held
course of running its business as one large
corporation. Akers intends to break IBM up
into a number of corporations. And while
“Big Blue” will continue to be big by most
standards, the businesses will run under a
leadership and not a managerial mentality.
The corporation will no longer rest on the
false comforts of economy of scale. Nor will
executives be preoccupied with coordination
and control, with decentralized operations
and centralized financial controls. Process
will take a backseat to substance, and the
power will flow to executives who are creative and, above all, aggressive.
If other large companies follow this lead,
corporate America may recharge, and its
ability to compete may rebound. But if left to
professional management, U.S. corporations
will continue to stagnate.
Since “Managers and Leaders: Are They
Different?” was first published, strategy has
catapulted itself into the number one position on the managerial hit parade. No aspect
of corporate life is indifferent to strategy.
Every problem leads to strategic solutions,
ranging from how to position products to
how to compensate executives. We have a
plethora of marketing strategies, employee
benefit strategies, and executive development strategies. Strategy, it seems, has repage 5