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5 Core Functions of Management: Why Leadership is Only the Beginning

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Extremely unscientific fact: there are a million leadership books on my home office shelf. Actual, verifiable fact: leadership training is a $366 billion global industry, according to TrainingIndustry.com. 

“Leadership” is on the verge of becoming a business buzzword, overused to the point of becoming meaningless. But it’s a term we’re all familiar with for good reason: It’s the cornerstone of our studios. For most of us it’s also foundational—our followers (students, clients, staff) are loyal to us because we do a top-notch job of, well, leading them. So if we’re all killing the game, where’s that $366 billion going and why? 

It’s possible that leadership alone isn’t enough. At the end of the day, a passionate speech to rally the troops won’t get the job done without some serious tactical support behind it. On the other hand, bulletproof management systems on their own won’t be sufficient to inspire your team to ascend the mountain, whatever that means for you. A healthy business needs both. 

Leadership vs. Management

There’s a critical distinction between leadership and management. U.S. Navy rear admiral and computer scientist Grace Murray Hopper said, “You don’t manage people, you manage things. You lead people.” 

Earning her PhD in mathematics from Yale University in 1934, Hopper became a luminary in her field of computer programming, creating many of the computer languages we still use in 2021. She went on to receive more than 40 honorary degrees and was posthumously awarded the Presidential Medal of Freedom. But Hopper was also known as a skilled teacher and communicator who could connect not just with other scientists and technicians, but with young students and business people outside her field. Sure, she could debug a complex machine, but she could also galvanize a group of people around why debugging that machine was important for the greater good. 

In short, Grace Murray Hopper was a manager and a leader. It stands to reason, then, that we could take a page from Hopper’s playbook and learn to balance our focus between leadership and management.

As small business owners, the path we’re on can be arduous. On any given day we juggle an overwhelming list of tasks and make sure to smile (lest anyone think we’re not grateful for the opportunity to be doing what we love). We lead a team of people who look to us for their every move. We aim to invest in the future, make a lasting impact in our communities, honor fiscal responsibilities, maintain work-life balance (if there is such a thing) and, quite literally, change the lives of our students and families through the artistry and discipline of our chosen fields. And that’s just Tuesday.

To make sense of it all, many of us spend huge amounts of money—and time, arguably the more-precious resource—learning about leadership. We attend seminars, buy books, sign up for e-newsletters, and do worksheets, but on that typical Tuesday we find ourselves struggling because somehow it isn’t enough. Because leadership training focuses so much on the why and not as much on the how, we sometimes struggle to get what we want through leadership training alone. 

US News & World Report stated: “Business management focuses on the art and science of running complex organizations and supervising others.” Art and science. That duality is what makes good management so important and so difficult, and it’s at this intersection that Grace Hopper’s distinction doesn’t completely work. While it’s true that you lead people and manage things, the reality is that you need people to do the things up to standard, on budget, on deadline, and without quitting. This is where management comes in.

5 Core functions of business management

The five core functions of business management are Planning, Organizing, Leading, Staffing, and Controlling. Planning is deciding on a goal. Organizing is determining how the goal will be achieved. Leading is about inspiring everyone to achieve the goal. Staffing means selecting the people who will make the goal a reality. Controlling is evaluating the level of success. Note that leadership isn’t the star player but rather one on a team of five—only part of the larger whole of management.

Most studios, like sole proprietorships, place the leader squarely in charge of all five of these functions, and that’s as it should be. No one is more qualified to make the decisions associated with these core functions than the owner/entrepreneur, at least in the beginning. Additionally, the leader is usually highly skilled in at least two of the functions, otherwise they probably wouldn’t be the leader in the first place. Yet once a business reaches a certain size or budget or number of years in operation—or the leader experiences their own personal mile-marker like a birth, death, wedding, or move—it’s probably not a one-man proposition anymore. 

There is a scene in All That Jazz, the 1979 fictionalized biopic about legendary choreographer Bob Fosse, where the main character Joe Gideon has a panic attack mid-rehearsal because the pressure of the theatrical production rested solely on his shoulders. To communicate Gideon’s claustrophobic anxiety, the camera pans past the dancers, their upturned faces breathlessly waiting for his next burst of creative genius. “Nothing is coming,” he says with sweat streaming down his face. “Nothing is coming!” 

Surely many entrepreneurs have felt this same anxiety. We can’t—and probably shouldn’t—be trying to plan and organize and staff and lead and control everything on our own. A hyperfocus on the leadership part (remember that $366 billion industry?) complicates the journey further by making us over-educated but under-activated. There’s only so much knowledge a business owner can take in before it becomes paralyzing; as success guru Darren Hardy says, “Knowledge is not power; it is the potential of power.” In that spirit, let’s investigate our own versions of the five core functions—our potential of power.

Assuming we’ve got the leadership part taken care of, let’s look at the planning function, which in the executive context is nothing more than appropriate goal-setting. What are your business goals? Are they appropriate, meaning achievable and measurable? Have they been communicated clearly and concisely to the people responsible for reaching them? This function will never leave the leader’s list, and for good reason.

Next Focus: Organizing

This one is so crucial that it has its own college degree: organizational management. Much more than colored pens and label makers, organizing is setting your people up for success by creating teams and departments that you manage. How would you rate the “organization” part of your business? Are people on the right teams? Do the teams have strong leaders? Staffing: recruiting and hiring the right people for the right job. In fact, between organizing, leading, and staffing, you’ll notice that 60 percent of the five core management functions have to do with people—the part that’s only “supposed to” be guided by leadership alone. People, not just things, have to be managed.

The last function, controlling, is important enough to consider at depth (and no, not because business leaders should be control freaks!). Controlling details your business’ past, present, and future in reporting and statistics. This is your rearview mirror, your windshield, and your GPS all rolled into one. You wouldn’t pack your family (and snacks!) for a road trip and leave behind those three—and no small business owner should attempt the equivalent. 

Controlling considers your processes and procedures, helps you establish (and maintain) a standard, and determines how well you are reaching goals through use of items such as your P&L and balance sheet, client management software and reporting, and employee handbook and operations manual. Do you have robust controls in place? Where do you wish you had a little more support? What can you start improving today?

All this plays a part in leadership, and leadership’s value is undeniable. Most employees aren’t engaged by reports and statistics, and processes and procedures aren’t terribly exciting unless they’re part of a larger, more fulfilling endgame. In a mission-driven work culture (particularly with millennials and Gen Zers), the endgame is everything and employees want to know that their efforts matter. 

This is where great leadership comes in—the entrepreneurs who can inspire, energize, and engage their teams have a decided advantage over the well-qualified but lackluster managers of the world. People want to work for a person, not a spreadsheet. An idea, a charter, a mission: these are what get employees out of bed in the morning and into their Monday Zoom meeting (or classroom or office). So don’t put away that leadership book—and make sure you’ve got a healthy selection of management materials next to it on the shelf.

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