Why is Leadership Important?

Why is leadership important?

Because everything rises and falls on leadership. Everything.

The success of an organization, the well-being of its people, the future of a country – it all lies on leadership.

Bad leadership = bad results. Good leadership = good results.

Not convinced?

Why is Leadership Important

In this article, we are going to discuss 15 reasons why leadership is important.

1. The effectiveness of the team (or organization) is determined by the leader

In their book, Extreme Ownership, Jocko Willink and Leif Babin’s state that there are no bad teams, just bad leaders.

They give the example from Navy Seal training where teams were doing drills and challenges in boats. One team kept coming in first and another kept coming in last.

They switched leaders. The team that was last started being first and the team that was working well together because of the good leader beforehand kept working well even with the other leader.

The difference wasn’t the team – it was the leader.

The same example can be shown in many workplaces and situations where new leadership came in, where only the leadership changed, and the results were astounding. This is one reason why is leadership important.

Both the books from Navy commanders (Turn the Ship Around and It’s Your Ship!) speak to this. They both started with the bottom-ranked ship or submarine, and it was the change of leadership and leadership mentality that made them #1 with the same crew.

What determines the success of an organization is leadership. It all goes back to leadership.

"What determines the success of an organization is leadership." ~ Thomas R. Harris Click To Tweet

2. People’s lives, hopes, dreams, and work pleasure – are all affected by leadership

Why is Leadership Important - all affected by leadership.

Many people live stressed lives and live for the weekend not because of the type of work they do, but because of the leadership, they work under.

Too many people are pounded day by day by bad leadership and it hurts their joy, motivation, and satisfaction at work. As a result, the negativity can spread to their home as well.

People can become disillusioned about their future and what they do, and sometimes leaders take actions that can hinder or slow people’s progress in their careers and lives.

On the other hand, great leadership can do much for those under them.

Why is leadership important? They can create an environment where people enjoy coming to work. They can create an environment where they feel heard, their input matters, and they find purpose in what they do.

Great leaders help grow their employees and help them reach their career goals.

They show trust in people at work. They create a safe environment of motivated and productive employees.

It all goes back to leadership.

"Great leaders help grow their employees and help them reach their career goals." ~ Thomas R. Harris Click To Tweet

3. A leader helps determine the motivation of those under them

According to Daniel’s Pink book Drive, humans have three main motivations:

  • Autonomy
  • Mastery
  • Purpose

There are other factors that can tie in, but those are the main three. A good leader helps their employees or those under them to have these three.

Autonomy is having choice and control in your work. Good leaders set the end goal and intent and let their employees reach the goal in their own way. Poor leaders micromanage everything their workers do.

Good leaders help their employees reach mastery. They give them work and resources to grow and get better at their jobs.

Good leaders also help their employees find purpose in their work. They help them see the big picture and connect what they do with that purpose.

Poor leaders often do activities that hurt motivation. They control and micromanage. They give their employees no sense of purpose, just tell them to get the work done. They aren’t concerned about their employees and their growth. They just want “results”.

All this affects motivation, and all this comes from the leader which is another good reason why is leadership important.

Because it all goes back to leadership.

4. Leadership affects employee morale and engagement

According to its State Of The Global Workplace report, Gallup concludes that 85% of employees are disengaged at work.

The most recent Gallup State of the Workplace survey found that 60% of people were emotionally detached at work and 19% of them are miserable!

Why? Ultimately, leadership.

And it has a cost.

It increases turnover (which is costly) and can cost companies billions in productivity.

When leadership creates a safe environment and a great culture of openness, communication, and innovation, and where (the right kind of) mistakes are welcome, morale and engagement flourish.

When employees feel motivated because they are given autonomy, mastery, and purpose, engagement and morale grow.

When employees don’t feel safe, when it’s a negative environment, when they feel they must protect themselves, when they are pitted against other employees, when gossip and silos are rampant, when they feel micromanaged and have no purpose in what they do, when they fear having to give certain news to the boss… morale and engagement will diminish or disappear.

It all goes back to leadership.

5. Leadership affects employee productivity

Why is Leadership Important - Leadership affects employee productivity

Another reason why is leadership important is, if you take into account what we’ve mentioned so far, it makes sense that leadership affects productivity.

When people feel motivated and work in an environment where they feel safe to take risks and make mistakes, then they are going to be more productive.

When they feel controlled, micromanaged, have no purpose, and work in a negative environment, they are going to be less productive.

In fact, according to a report by Gallup, it cost the U.S. $450 to $550 billion annually due to loss of employee productivity.

It all goes back to leadership.

6. Leadership affects employee retention and turnover

Here’s another reason why is leadership important in the workplace. In one survey, 50% of respondents said they have left a job due to bad leadership, and another said that 76% of respondents stated that their leader was toxic (which if you look at the other stat, means a good bit of them will be leaving).

If you look at teachers and the teacher shortage, thousands of teachers are leaving the profession. Yes, there are multiple factors that go into it, but ultimately, it’s because of leadership. The policies and lack of trust in leaders are creating an environment that makes them want to leave.

And, again, it makes sense when you look at the reasons. When people work in a negative and demotivating environment and/or one where employees don’t feel respected or trusted, they are more likely to leave.

When they work in a safe, trusting, and motivating environment, they are more likely to stay.

And turnover is costly.

In 2017, Employee Benefits News (EBN) reported that turnover can cost employers 33 percent of an employee’s annual salary.

According to the Society for Human Resource Management, every time an employee leaves, the employer will need to spend an equivalent of 6-9 months of salary to find a replacement.

In fact, US employers spend $2.9M per day looking for replacements. That’s $1.1B per year (ZENEFITS).

7. Better leadership equals better decision making

Better leadership equals better decision-making.

One of the biggest mistakes not-as-good leaders make is that they feel like they know better and have all the information. They make decisions that end up hurting those who are actually dealing with the problem (and hurt the company) instead of helping.

It happens over and over in about every industry if not all (education, government, business, non-profits). Sometimes poor leaders don’t ask for input because of arrogance and sometimes it’s because of insecurity.

Great leaders do make decisions on their own when the situation calls for it, but they are also great about gathering input from others, especially from those who are the ones facing the problem (and really, depending on the problem, good leaders enable those dealing with the problems to fix the problems).

Better decision-making happens with good leadership because they seek input. But it’s more than that.

Poor leaders create an environment where people fear speaking up. They don’t want to disagree because they don’t want to face the boss’s wrath or potentially hurt their career or job situation.

Great leaders encourage disagreement. They value other viewpoints because they know by fully exploring an idea, the good and the bad, can they make the best decision.

And because of that, because of good leadership, better decisions are made.

It all goes back to leadership.

8. Great leadership equals greater innovation and ideas

Why is Leadership Important - Leadership and innovation

Similarly, great leadership creates an environment where greater innovation and ideas come about.

Great leaders encourage risk-taking and for their employees to try things and make mistakes. Their employees don’t fear “messing up” because they know their leaders have their back.

Great leaders create an environment where it’s safe to speak up, share ideas, challenge processes and ways of doing things, and where disagreement is encouraged.

Bad leaders don’t do this. They create an environment where people feel leadership is out to get them. If they make a mistake, they are going to be gotten on to. This creates a “play it safe” environment where people don’t take risks and only do work they know they can succeed at.

Bad leaders also don’t encourage ideas. They often want people who just agree with them. They create an environment where people fear speaking up because of potential retribution.

It all goes back to leadership.

"Great leadership creates an environment where greater innovation and ideas come about." ~ Thomas R. Harris Click To Tweet

9. Leadership determines the effectiveness of reaching a goal or mission

Good companies have a purpose or mission beyond just making money.

Yes, profits are important, and you must have profit to meet your purpose and keep going, and good companies have good purposes.

Nonprofits’ whole reason for being is to pursue a mission or purpose. And leadership, in both cases, will affect how well a company, nonprofit, educational system, government, and so on reach that purpose.

Great leadership and the effects we’ve discussed so far will help a company or organization reach its goals and mission more effectively and faster.

Poor leadership hurts it and may even cause that organization to fail.

Too often poor leaders are more about themselves and their own goals, their purposes, or meeting their insecurities than the purpose or goals of the company or organization.

That, of course, hurts the company.

Good leaders put the goals, the purpose, and the people first, not themselves. Because of that, the organization moves forward better and faster.

I remember when I worked with a non-profit organization for a short period of time. One of the employees I got to know had his position moved under someone new.

He told me that part of his job was to create awareness and raise funds for the organization. He did really well – in fact – so well, he was raising more than his supervisor.

Instead of being happy about it, she was upset. She was upset because she was afraid it made her look bad. She was more concerned about herself and her insecurity than the organization and its purpose. (And what she didn’t, or doesn’t, realize is that him doing well makes her look good, not bad).

It all goes back to leadership.

10. Leadership determines the success or failure of a business

Why is leadership important? Ultimately, the entire success or failure of a business goes back to leadership. You can look at point one to see this and you can look at so many examples in our world.

But let’s also look at the mentality many leaders have today at their companies.

Many are focused on short-term results – showing profits or growth for the quarter, for example, and they ignore the long-term.

They do activities that prop up the numbers (for now), but in the long run, they kill the company.

It all goes back to leadership.

11. Better leadership equals more honest and ethical businesses

Why is Leadership Important - Better leadership equals more honest and ethical businesses

Look at Enron and the other companies you may have heard of that had unethical business practices.

It all stemmed from its leadership.

Why is leadership important? When you have good leadership:

  • You have more honest and ethical businesses.
  • You have businesses that pursue the right purposes.
  • You have businesses that are about people and purpose, not solely focused on profit or making the shareholders happy.
  • You have people who are bout long-term success over short-term success or number-propping.
  • You have people who do what is right instead of convenient.

It all goes back to leadership.

12. Great leadership means the growth of other leaders

With good leadership, you gain more good leadership. It’s a reciprocal process.

Bad leaders don’t reproduce. It hurts their image. They are either afraid someone may outshine them or it could hurt their image long-term.

Good leaders are about building leaders as they know it helps their organization in the now but also in the long term.

They want to make sure the organization continues well without them, not only when they are there.

Poor leaders are happy when things fall apart without them because they think it shows they were good leaders when it really shows the opposite.

13. More problems solved

One distinguishing characteristic between good and bad leaders is that good leaders take ownership and blame for their mistakes and for those under them. They give praise for success to their people or team.

Bad leaders, on the other hand, cast blame for mistakes and failures and take credit for their good of themselves.

When you have good leadership, you have people who accept responsibility and work to resolve problems. They aren’t about finding someone to blame or a scapegoat but on actually fixing the problem which answers why is leadership important.

They listen to ideas and input from others, and they also put problem-solving power into the hands of those who are closest to the problem to solve it.

They aren’t about control or looking good, they are about their purpose and solving problems well.

14. Leadership helps determine revenue earned

Another reason why is leadership important is when you look at everything we mentioned, this makes sense.

With poor leadership, you have lower morale and motivation, less productivity, and higher turnover.

You have fewer ideas, less innovation, worse communication, more problems, and worse decisions.

All of that can cost a company billions of dollars.

All because of leadership.

Great leadership increases morale and motivation, encourages creativity, innovation, and ideas. It creates an environment of good communication, makes better decisions, and solves problems better.

This not only saves money that poor leaders lose due to turnover and productivity loss, but better communication and better ideas mean problems are solved faster, and new and innovative ideas that can save or earn more money.

It’s all leadership.

15. Leadership determines the results you get

Why is Leadership Important - Good leadership get you better results

This one is basically a recap of all of the above put into one.

With good leadership, you get better results.

You get more revenue and profits because, with good leadership, you have higher morale, higher motivation, higher productivity, and lower turnover.

Bad leadership has the opposite.

With good leadership, you have people who are motivated, who feel safe innovating and sharing ideas (and disagreeing), and you have an environment where people can solve problems and get things done.

You have better-functioning teams, fewer silos, and higher morale.

The better the leadership, the better the results you get.

It all goes back to leadership. 

BONUS: With good leadership, you get governments and agencies that create policies and take actions that help people

Think about it, with good leadership, we would have governments that create policies that help instead of burden us or hurt us.

We would have less senseless bureaucracy because it’s about helping people not creating rules.

We would have people who were about the good of their constituents, the people as a whole, and the country, not themselves and their own interests or their party’s interests.

We would have people who are about doing what’s right instead of saving face or just doing something to show they “did something”.

We would have people who are connected to the actual problems people face versus thinking they know best when they are disconnected from the people and problems.

It all goes back to leadership.

Final Thoughts on Why is leadership important?

Why is leadership important? Because everything rises and falls on leadership.

As we’ve discussed, the success of an organization, and the satisfaction and well-being of people – all rest on leadership.

That is why we need to work hard as leaders to be the best leaders we can be. We can’t sit around. We MUST be great leaders.

And we also need to stop tolerating poor leadership. If “leaders” aren’t willing to grow and be better, it may be time to find new leaders.

What do you think? What reason stuck out to you? Are there any reasons why leadership is important that we missed?

Let us know in the comments below.

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