Leaders vs. Managers

To a significant extent, your value as a credit manager is measured in terms of the performance of those who work for you. To be an effective manager, you must be an effective leader. Leadership is the process of influencing your subordinates to accomplish specific goals and objectives by providing advice, direction, encouragement, feedback, motivation, support and training.  To be a good leader, you must:

• Accept the blame when inadequate or improper training results in mistakes and other problems;
• Allow subordinates to participate in the decision making process;
• Are cool, calm and collected under pressure;
• Be consistent;
• Be technically competent, but tolerant of employees who are not yet fully proficient at their jobs;
• Compliment in public, but criticize in private;
• Celeberate successes and milestones;
• Create opportunities for professional development, learning and growth for their team members;
• Develop credibility with internal stakeholders not through their position or title but through their actions and decisions;
• Ensure that communications with subordinates and internal customers is two-way street;
• Explain how to perform a particular task as well as the reason the job is necessary;
• Have a vision for the department, and have the ability to communicate that vision in a way the credit team can relate to and can believe in;
• Have strong communication skills, problem solving skills, conflict resolution skills and negotiation skills;
• Hold subordinates accountable for their actions or inaction. Remember that people tend to perform based on what is expected of them;
• Identify the relationship between the work performed by subordinates and the larger objectives of the department;
• Keep subordinates informed through regular discussions;
• Lead from the front, and develop a track record of successes;
• Leaders cope effectively with change while managers tend to focus on managing and maintaining the status quo;
• Look for opportunities to be involved in special projects;
• Make your subordinates jobs as meaningful as possible;
• Managers are content with incremental improvement while leaders look outside of the box for 'game changing' ideas that they can implement to leap ahead rather than creep ahead;
• Model the behaviors they expect and want to see from co-workers and subordinates;
• Never ridicule suggestions made by subordinates because doing so is the surest way to discourage creativity in problem solving;
• Possess strong problem solving skills and do not try to dodge or fence sit when it comes to difficult decisions;
• Provide challenging assignments;
• Recognize and reward success rather than rewarding effort;
• Refuse to step in too quickly when subordinates start to struggle with assignments;
• Remove obstacles that prevent others from completing tasks or achieving goals;
• Set high but realistic goals for subordinates;
• Set an example for everyone to follow;
• Share the credit with subordinates when departmental goals are met or exceeded;
• Solicit input from a variety of sources;
• Take responsibility for your actions;
• Takes time to define and describe tasks assigned to others, explaining not only how the task is to be accomplished but why the task must be completed;
• Uses questions from subordinates as an opportunity to clarify issues, offer assistance if necessary, or to congratulate them on the progress already made;
• Utilize coaching to help team members improve their performance --- especially employees whose work is substandard;
• While managers push subordinates for results, leaders get results by recognizing and appealing to individuals drives, wants, and needs;
• Work at developing a team approach to solving problems and achieving goals;
• Work to capitalize on the strengths of each of your subordinates

Some credit managers take a hands off approach to personnel management - reasoning that once people are fully trained they do not need a manager looking over their shoulder and/or reminded of the importance of their work, or of the need to do the best job they can. The risks associated with too little supervision include:

- A perception that the credit manager does not care about the subordinates, and does not value their work or their accomplishments

- Misunderstandings and miscommunication;

- Poor coordination between and among the members of the department, and

- Poor performance for the department as a whole.

On the other hand, too much supervision tends to stifle creativity and initiative, and can be both de-motivating and demoralizing. One way to overcome this inherent problem is to disguise your instructions as suggestions. If your team members believe they have autonomy and authority over their work, you are likely to get better results than you would by giving orders.

© 2011 by Michael C. Dennis.  All Rights Reserved.  Michael is the author of "1001 Collection Tools and Tips."