BUS650 Study Guide

1a. Analyze the difference between management and leadership as an entrepreneur

• What are the main differences between a leader and a manager?
• What are the three main roles of a manager?
• What is important to consider about the interpersonal, decisional, and informational roles of managers?
• What are the major duties managers perform?

Managers take on three main roles, which include interpersonal, decisional, and informational. Within the interpersonal role, they may be figureheads, such as by signing contracts, and they also perform other formal duties. As part of this role, they also lead their people by motivating, training, and communicating. The decisional role of managers involves initiating projects, idea generation, taking corrective action, and resolving disputes. They also allocate resources and negotiate. The informational role is one where they provide data to employees and other managers.

Manager responsibilities include long-range planning, controlling, environmental scanning, supervision, coordination, working with customs and the community, solving internal issues, monitoring planning, and scheduling the organization's production of products or services. There are four levels in the management hierarchy. The first is a rank-and-file employee, followed by first-line managers, middle management, and executive management. Each of these levels of management requires a different set of skills; for example, executive managers may use more conceptual skills, which are high-level thinking and strategic skills, while first-line managers use more technical skills. All levels of management use human relations skills. Management is different from leadership in that management focuses more on tasks, while leadership uses interpersonal skills to get things done. 

To review, see What is an Entrepreneurial Leader?.

1b. Categorize the characteristics and behaviors of a leader

• What are common leadership traits, and how do they differ from behaviors?
• How do leader behaviors impact relationships and tasks?
• What are the different types of entrepreneurs?

While leadership traits are important, leadership behaviors are important too. Leader traits might include drive and self-confidence, but behaviors determine how leaders act in certain situations. Regarding leader behaviors, consideration is the relationship-oriented behavior of a leader, while initiating structure is the task-oriented behavior. For example, consideration behavior might include being supportive and friendly, while initiating structure might include deciding what needs to be done and how to do it.

The Leadership Grid is one way to look at leadership concerns, such as concern for people (consideration behavior) and concern for production (initiating structure behavior). The level of concern for production and people may place leaders in five different categories of leader behaviors: accommodating, sound, status quo, indifferent, and controlling. 

When we consider leadership behaviors and traits, it is important to look at the types of entrepreneurs. The first is a classic entrepreneur, a risk-taker who starts a company based on innovative ideas. A multipreneur is someone who starts a series of companies over some time. Perhaps the most common type of entrepreneur manager is an intrapreneur, which means within their organization, they display leadership behaviors and traits that allow them to be entrepreneurial in their own companies.

To review, see Leader Behaviors and Types of Entrepreneurs.

1c. Compare and contrast the difference between elements of the POLC model

• How do each of the elements of the POLC model differ from each other? How are they the same?
• How might you apply leadership in planning, organizing, and controlling as an entrepreneur?
• In terms of leadership, how do you see each of the elements of the POLC model used?

While we've been addressing the elements of leadership, understanding the POLC model from a leadership perspective is important. The POLC model stands for Planning, Organizing, Leading, and Controlling. As you can see, leading is one of the main roles of management.

Planning involves anticipating potential problems or opportunities and developing goals, objectives, policies, and procedures around the organizational needs. There are many different types of planning, such as strategic planning, which has a timeframe of 1–5 years, to operational planning, which addresses the methods that will be used to meet the goals and objectives.

Organizing involves dividing tasks, grouping jobs and employees, and assigning responsibility. Ultimately, organizing involves coordinating and allocating resources effectively to carry out the planning phase.

Controlling is the process of assessing the organizational progress toward accomplishing goals. It involves setting standards, measuring performance, comparing performance to standards, taking corrective action, and using the information gained from this process to set future performance standards.

Leading is the ability to effectively guide and motivate others toward achieving goals. Several leadership styles can be used, and often, the leadership style is based on the particular situation or people being led.

To review, see Introduction to the POLC Model.

1d. Examine characteristics of different types of entrepreneurs, such as confidence and self-efficacy

• What leadership traits do you possess that will make you a great entrepreneurial leader?
• What leadership traits do you think are most important to be successful?
• Why do you think high self-monitoring is an important trait in leadership?

The trait approach to leadership involves core personality traits that make a leader successful. They can include elements like drive, honesty, integrity, self-confidence, cognitive ability, self-efficacy, knowledge of the business, and other traits such as charisma, creativity, and adaptiveness.

Dispositional traits describe mood and disposition. People who have positive affective traits exhibit an active mood and strong enthusiasm. Many leaders have positive affective traits.

High self-monitoring is a personality trait that refers to the strength of an individual's ability and willingness to read verbal and non-verbal cues. The ability to do this allows one to alter behavior so their self-presentation fits a certain situation. High self-monitors often end up as leaders in organizations.

Understanding strengths, weaknesses, opportunities, and threats (SWOT) can help develop leadership traits and abilities. Many leaders perform a SWOT analysis on themselves to assess their strengths and areas they want to work on.

To review, see The Difference between Leadership Traits and Behaviors.

Unit 1 Vocabulary

This vocabulary list includes terms you will need to know to successfully complete the final exam.

• classic entrepreneur
• conceptual skills
• consideration behavior
• controlling
• decisional role
• dispositional traits
• initiating structure
• interpersonal role
• intrapreneur
• Leadership Grid
• leading
• multipreneur
• organizing
• planning
• self-monitoring
• strengths, weaknesses, opportunities, and threats (SWOT)
• trait approach to leadership