The Difference Between Leadership and Management

Hey there. Lars Hedenborg here, founder of Real Estate B school and co founder of High Performance Real Estate Advisors, Charlotte, North Carolina. And today we're going to talk about the difference between leadership and management and how the byproduct of the two is accountability. You know, I'm 12 years into my business journey and my real estate team has sold over 3,000 homes. So we've served 3,000 families and, and I only served about 220 with my personal production. I built the business on a really sound financial model. So an economic model that works and that has scaled from my first year. I hired a buyer's agent. We did 58. Well, he was hired late in the year, so I basically did 58 myself that year. And then we did 118 with my first buyer agent hiring a few misfits and then went on to 118, 178, 248, 312, 400plus units. And the thing I fail with most in there was leadership and management, but really accountability. And I read an awesome, awesome, awesome book that I recommend, how to Be a Great Boss by Geno Wickman. And he talks about lma. So leadership, management and accountability. And he gives a very simple equation where he says leadership plus management equals accountability. And from the book he says you can't demand accountability or wish for it, you must create it by applying a simple equation. Leadership plus management equals accountability. There's a cool quote by Peter Drucker that says management is doing things right, leadership is doing the right things. So leadership, I'm going to read this off here. Leadership is defined as working on the business, giving clear direction to your team, creating the opening, meaning that as you're scaling this business, as you're fulfilling the vision that you've set out to achieve, you're creating openings for your team members. And leadership is mainly a thinking job. There's a quote from Edison or Albert Einstein. You know, thinking is such a rare thing because nobody does it. And then management on the other hand, is working in the business. So this is where your hands are dirty and you're working through systems and people issues. It's giving clear expectations, it's communicating well and it's the doing part of a business. And so, you know, when I think of and in terms of leadership, there's a few things I want to go through. There's a quote by Thomas Edison, he says vision without execution is hallucination. So if you look at leadership versus management, you know, you want to be in the quadrant where you're Managing and you're leading and that's where growth happens. So it's vision with traction. So it's providing that leadership and providing the management and that's where you get growth. If you have management without vision, your business is rudderless, it has no clear direction. If you lead but you don't manage, that is complete hallucination, right? Like you can be out there just casting vision and nothing's going on to actually achieve it. You know, you don't want to be there. And then if you have no leadership, no management, it's an absolute nightmare. And so vision without execution is hallucination. And so there's just a few things that I want to cover here that I think will be helpful. And you know, I think a lot of times it was one of my fears when I, you know, I got into real estate and I hadn't hired anyone, I hadn't managed anyone before. And you know, you don't really know like what to do. I mean, nobody taught me this back then. You know, this is something I learned over the years and I'm now able to teach to real estate B school members that are coming after me and sort of scaling their businesses. But there's really four things, four ingredients to being a great boss or four truths. Number one is that being a great boss can be simple. There's some basic leadership practices and management practices that you need to employ in order to be a really great boss. And they're not very difficult. So leadership is mostly about vision. There's a planning process that we follow where basically you answer like five questions to really create the vision for your business. And then we have a process, a a meeting or a business cadence and structure to achieve that vision that you set. And that includes annual planning meetings, quarterly check in meetings, and then weekly meetings with leadership. And so it's real simple. Process Truth number two is that your style does not have to change. A lot of folks think that leadership is a sort of like a, you either have it or you don't like. It's that natural sort of charismatic leader. And that's just not the case. These are things that you absolutely can learn how to do. You could be nice, you could be tough, you can be introverted, extroverted, it does not matter. Just be yourself and authenticity is believable. And that's what builds trust within the team. If you don't know what you're doing, it's okay. I can't even tell you how many times I've told my team, hey guys, how many times. Do you think I've built a multimillion dollar coaching business before? And I'm of course like, you know, being, being funny and they get it, like they give me grace when I make mistakes because I've never done this before and we're all doing it together, you know, so it kind of puts us all on a level playing field. Truth number three, you must genuinely care about your people. This is one. I am sad to admit that in the early part of my real estate business growth journey, I really, I was probably, it was overwhelmed. I had two young children, first born in late 2007. My daughter was born in April 2010. And those were my big growth years. And so I just don't think I was in a good place. I viewed people as a way to make my life easier. I did not view people as an opportunity to serve and help them get to their next level, which is the way that I feel about my people now. So there's been a radical shift for me there. And you know, people don't care about how much, you know until they know how much you care. It's really, really true. It's sort of a kind of easy to say, you know, hard, hard to do, but just bring humanity and humility and give tons of grace. It doesn't mean you have to have lower your standards because, because people need structure, cadence, accountability and standards. But just, just give grace every day. So truth number four is you must want to be great. So for your business to grow, you must grow. This is probably the coolest part of my journey over the last, I guess it's going on 12 years now. March. Yeah. As of this recording, it's, it's. I Almost, it's almost 12 years ago that I left my corporate job to get into real estate. And so it has been. I've grown more than I ever could have possibly imagined. And I probably a lot of the books that I listened to probably didn't move me forward, but I have been ravenous about learning, you know, people and systems and how do you really scale, how do you simplify the business? How do you, you know, how do I sort of get more emotionally intelligent so I can connect with my team members better? You know, how do I, I'm really sort of very, very driven and very fast paced and how do I, how do I make sure that doesn't, you know, tire my team out and how do I keep them engaged and energized when, when I'm so far out there all the time? And then how do I Not drive my, my wife and my kids crazy at the same time. So hopefully that was helpful. You know, this is an area that if you don't focus on, on, you know, leading and managing and learning that the byproduct of those is really where the accountability comes from. You're not going to scale your business or it's just going to be a loose collection of people and it won't even be a real business. You know, we're seeing a lot of quote unquote teams in the real estate industry are really not. They're not businesses because they're not highly coordinated systems and people that are delivering a system. I won't say systemized service, but like a unified service. Like we're seeing a loose collection of agents, basically brokerages within brokerages that I don't believe me personally that they're sustainable. I don't think those businesses are going to be around three to five years from now because they're not providing value to the agents that are on those quote unquote teams. And I don't think the team itself is delivering a quality real estate experience to buyers and sellers that, that they're even going to be able to defend the commission rates that they charge. So if you missed the episode, I did an episode on high performance. I like building a high performance real estate team versus any other team. It was in January 2019. You should go back and listen to it. I think you really got to focus on what you're building and not just going about this haphazardly because it is going to go down in the next year, know, couple years, three years. The whole industry is getting ready to change. So hopefully that's helpful. Leadership management equals accountability. I've got so much love and respect for this industry, for those that are challenging themselves to step up and get to their next level. And if that's you and you want to have a conversation about it, go to realestatebschool.com there's no hard sell, there's no gimmicks, there's no hype. It's just the stuff that works and it's proven and we love doing it. It's business coaching. That's what the B and B school stands for. Business coaching for the real estate industry. We'll talk to you soon.