June 2025

Managing with a leadership mentality By Stan Pohmer

In all my many years in retail and then in my consultancy, I thought I had experienced just about all the highs and lows of the economy, politics and social impacts affecting businesses and our consumers. But 2025 stands unique. Resultant strategic shifts in the way businesses operate all bring tremendous fear and trepidation to our consumer and how the unknowns affect their lives and lifestyles, their retirement plans and their spending behaviors.

Without some confidence on where employment is going, how businesses (and consumers) will adapt to higher prices caused by tariffs, the challenge of higher inflation while wage growth has dramatically slowed, financial institutions that are skittish about lending to individuals and small businesses — just some of the new realities consumers are facing — these unknowns all combine to limit discretionary spending and their propensity to spend.

In March, the long-term monthly study “The Consumer Sentiment Survey,” a study of consumers’ confidence in their financial future by the University of Michigan, recorded the second-lowest rating since 1952! This year is definitely not business as usual!

What got us through the tough times in the past (think COVID pandemic, recessions and financial crises) was an unwavering dedication and focus on managing our business operations and our staff, looking for better ways to control expenses, maintain a positive cash flow, and squeeze every last turn from a very tight inventory. We deferred or delayed investing in our businesses, making do with what we had on hand. We were — and in many cases still are — in an “operational management” mentality and mindset. With the massive changes we’re facing in 2025, I’m not sure that we can just manage our way through this year’s uncertainties.

So, what do we need to do to survive 2025, in addition to managing our businesses as best we can? A leadership mentality! But first, what’s the difference between managing and leading? Are they the same but with different words describing them?

Management Versus Leadership

Let me answer by way of an example. I think we all know someone who was a great manager who, because of their exceptional managerial skills, got promoted — and then epically failed. My guess is that individual didn’t take a stupid pill when they took that new position that caused him or her to fail, but rather, they were a victim of the Peter Principle (made famous by the late business guru, Peter Drucker) that stated that the individual was promoted one step above his/her level of competency.

In many instances, the reality is that the promoted individual lacked the different skill set necessary to succeed in the new position. He or she knew they were promoted because of their excellent management skills and, in the new position, thought they could succeed by focusing on these same skills and doing more of what they got promoted for, becoming a super-manager.

Unfortunately, the new position required leadership skills — skills that most of us never learned or were taught in business school; without those, the promotee reverted to their demonstrated managerial strengths and couldn’t fulfill the expectations of the new position — and failed. We used to think that management and leadership skills and mindsets were essentially the same, but in today’s low cost/high productivity world where teams are lean, they can’t be. Leadership is not simply an advanced form of management! Leading requires different attributes, skills and behaviors than managing.

To understand some of the differences between managing and leading, try thinking in these terms.

Managers:

• Attend to operational excellence and, at their best, deliver against high expectations.
• Provide the business and its stakeholders (read: customers, suppliers, your team and company owners) with reliability, certainty and predictability — all very essential traits.
• Attend to continuous improvement, monitor progress against objectives, and track and report the data that allows for valid and solid fact-based decisions. Every person in every role in every company has management responsibility — the requirement that others can rely on him/her and their teams can deliver as promised within the parameters agreed to.

Leaders:

• Are a causal force — they cause things to happen that were not going to happen without their influence.
• Are future-oriented individuals who envision possibilities — what could be, not just an improvement to what exists today.
• Are adept at innovating, articulating a vision, creating strategies and inspiring growth and development in others on behalf of the vision. Leaders are rich in determination and incredibly resourceful.

Simply put, leaders lead people; they don’t just manage them. Described by another Drucker-ism: Management is doing things right; leadership is doing the right things.

In his book, “On Becoming a Leader,” Walter Bennis offered a pretty clear comparison chart that illustrates the differences between a manager and a leader:

• The manager administers; the leader innovates.
• The manager is a copy; the leader is the original.
• The manager maintains; the leader develops.
• The manager focuses on systems and structure; the leader focuses on people.
• The manager relies on control; the leader inspires trust.
• The manager has a short-term view; the leader has a long-range perspective.
• The manager asks how and when; the leader asks what and why.
• The manager has his or her eye always on the bottom line; the leader’s eye is on the horizon.
• The manager imitates; the leader originates.
• The manager accepts the status quo; the leader challenges it.

Comparing these manager and leader descriptors and behaviors, we can start to see that the differences are more than just what managers and leaders do. Fundamentally, the differences are more in the mindsets and approaches; the manager thinks and acts tactically and the leader acts and thinks strategically. The manager is more task-oriented, focused on day-to-day operational successes, while the leader is more focused on what can be ­— the opportunities and potentials — and then inspires and helps his or her team rise and develop the needed skill sets to achieve these dreams.

Leading Your Team to Success

In small businesses like ours, the challenge is that the manager and the leader are often one and the same person! But there’s a limit to how successful a company can be by just managing better. To reach the full potential requires someone to see the bigger picture and then set the goals and inspire the whole team to follow and support the new path to survival, growth and success. When you’re both the manager and the leader, it’s not easy to switch mindsets and approaches; you can’t just flip the switch on and off. And your team needs to be able to differentiate when you are acting and speaking as the manager versus when you’re acting and speaking as the leader.

Some will say that management is essential, even critical to the success of a company, focused on exceptional operational management execution. And they will also say that leadership is optional; and to simply survive, this is true. But to anticipate and prepare for future challenges, to grow and prosper, to search out new opportunities, to see the potential — this requires a leadership mentality.

For you to engage your team to provide the best service to your customers, your stakeholders and your shareholders, you must get them to buy into your vision and align their perceptions and behaviors with yours. You need to get them excited about where you are taking them, while making sure they know what’s in it for them. The challenge for you is that you are both leading your team as well as managing your day-to-day operations. Those who can do both will create a real competitive advantage!

You’ve proven that you’re an excellent manager — you’ve survived the multitude of challenges that have made you an even stronger manager. Now it’s time to see the opportunities and potential of what can be, to set bigger goals and to inspire your team to see the grand and exciting things you see for the future.