What Is Leadership? (2024)

Leadership. It’s one of the most powerful forces on planet Earth. In its best form, leadership puts a spring in your step, builds courage in your heart, and gives you the head-to-toe mojo to move mountains. But leadership done badly—whether you’re on the giving or receiving end of it—drains your soul, shakes your confidence, and makes you want to run for cover.

So, of the 2.5 billion results (literally) you get when you Google “leadership definition,” which one is right? At the top, you’ll probably find that it’s the position of a leader, the capacity to lead, and the act of leading. Thanks, Merriam-Webster, but that’s not super helpful.

In a more stripped-down definition, leadership is the ability to influence and maximize the talents, passions and skills of others to achieve a goal. And for the world-class leader, leadership is the ability to empower and bring out the best in others to serve the greater good.

As President Harry Truman put it, “Men make history and not the other way around. In periods where there is no leadership, society stands still. Progress occurs when courageous, skillful leaders seize the opportunity to change things for the better.”

In other words, leadership is kind of a big deal.

Traits of a Great Leader

Maybe you’re leading and growing your business so you can make life better for tons of people. Or you might be an accidental leader who was so freaking good in your role that you were chosen to build a team of people who can do what you do. Then again, you could just be in the figuring-it-out stage, wondering if you’ve even got it in you to lead others.

Wherever you find yourself, here’s the thing about leadership: Becoming someone worth following is less about leadership theories and formulas and more about the character and principles you lead with.

In fact, you probably already have a picture in your mind of some amazing everyday heroes you admire and respect for their ability to cast vision and lead courageously. Take a minute to think about their character qualities. If you’re like the thousands of people before you who’ve done this exercise, your list of leadership traits looks something like this:

• Integrity-driven
• Servant-minded
• Humble
• Visionary
• Decisive
• Disciplined
• Passionate
• Loyal
• Focused
• Influential
• Driven
• Charismatic

Guess what? You’re onto something! These qualities are the nuts and bolts of the definition of leadership. So if you’re serious about growing as a leader, focus on building the character traits on this list.

And listen—don’t worry if you only have a few of these mastered right now. Everyone has something to work on no matter how experienced they are as a leader. Just like most things that matter, slow and steady wins the race. There’s no such thing as an overnight success!

Here are some steps to get you started on your leadership growth:

• Decide and commit to change.
• Read as many biographies, autobiographies and leadership books as you can get your hands on.
• Listen to people—like really listen. And learn. Don’t just jump in with advice before you’ve heard them out.
• Observe all kinds of people, and value their differences. What moves them? What brings out the best in them, and what takes the air out of them?
• Reflect on the leadership qualities listed above. The ones you need to focus on usually stick out like a sore thumb.
• Do the hard work. Apply what you’ve learned and make the necessary changes to lead with purpose. You’ve done your research, and now it’s time to make the best calls you can as you grow.

Throughout your journey, sometimes you’ll win and . . . other times you’ll screw up. But take heart! Henry Ford had you and every other brave trailblazer in mind when he said, “The greatest thing in life is experience. Even mistakes have value.” The key is finding the lesson in your failures and successes and applying what you learned to make you a better and stronger leader.

You probably thought running a business sounded fun—until you realized it would actually run you. Discover the EntreLeadership System—the small-business road map that takes the guesswork out of growth.

Related articles:
7 Keys to Developing Leaders in Your Small Business
What Is Leadership Coaching?

Types of Leadership

The list of all the different leadership styles is as long as your arm. Some styles are great. Some leave us shaking our heads for all kinds of reasons. As you sort through a few of the most common types, remember that a leader’s greatness is less about power and more about how they create vision and empower others.

Transformational Leadership

Transformational leadership is based on trust and respect that raises followers to higher levels of motivation and morality. It’s known for reducing drama and bureaucracy and inspiring productivity, innovation and creativity by focusing on the team’sability (not just the leader’s) to achieve big, daring wins.

Servant Leadership

Leaders who practice servant leadership prioritize empowering and growing their team. They focus on what they can do for others instead of what others can do for them.

Transactional Leadership

Transactional leadership focuses on managed, structured guidance with the goal of producing specific outcomes. Team members are rewarded for creating the expected results.

Laissez-faire Leadership

The French word laissez-faire means “allow to do” or “let the people choose.”¹ Laissez-faire leadership lets the team make their own path with little interference or guidance.

Bureaucratic Leadership

As the total opposite of laissez-faire leadership, this style values company policy and history over team member input. New, outside-the-box thinking is discouraged in favor of doing things how they’ve always been done—regardless of whether those things are still successful.

Autocratic Leadership

Similar to bureaucratic leadership, the status quo still holds the most value here. But this leadership type operates with team members having less power and leaders having more power.

Democratic Leadership

As you might have guessed based on the name, a democratic leader considers the views of multiple team members at multiple levels when making decisions for the organization. Almost everyone has a voice.

Leadership Myths and Myth Busters

Clearly, some of those leadership styles create workplaces where team members can thrive. Others . . . well, we’ve all had experiences with bad leaders who chose less-than-ideal leadership styles. Those negative experiences—and the types of workplaces they created—have led to lots of myths about leadership. Let’s bust through a few right now.

Myth:

Leadership means pushing, bossing and driving outcomes with fear, threats, micromanagement and manipulation.

Truth:

Great leadership pulls—meaning leaders are out in front, leading the charge. They grow the quality of their teams by inspiring, teaching and valuing them.

Myth:

Leadership is a skill you’re born with. You’ve either got it in your DNA or you don’t.

Truth:

Leadership comes easier to some more than others, but it can definitely be learned! And great leadership always evolves and grows stronger over time.

Myth:

Leadership belongs to the most dominant, extroverted personality types—like Enneagram 8s and high Ds on the DISC assessment.

Truth:

Great leadership traits is found in all kinds of people and personalities. It flows from your sweet spot, passion and decision to develop the character traits all great leaders have.

Myth:

Leadership equals popularity, power and celebrity-level talent.

Truth:

Great leadership is hard and rewarding. It values serving others over serving yourself and teamwork over solo talents.

Myth:

Leaders are managers first.

Truth:

Great leaders are visionaries, communicators, strategists and influencers first. They lead ideas and people. Managers, on the other hand, are planners, measurers and monitors first. They manage projects. Of course, leaders manage decisions, change and other situations, but they’d much rather leave the tactical steps to someone else.

Myth:

Without a leadership title or level of seniority, you’re not a real leader.

Truth:

True leadership has little to do with titles and doesn’t automatically happen when you reach a certain pay grade. If you’re banking on a title to motivate followers, you’re in for a surprise.

Great leaders lead themselves first. So, as new doors open, they already have the habits and character of a leader.

Myth:

A leader’s personal success is at the mercy of the economy, their teams and the available business opportunities.

Truth:

Great leaders, even in the hardest circ*mstances, find the grit to grow their abilities, character, knowledge and capacity. When they fall, they get back up.

Related article: America's Labor Shortage

Myth:

Leaders can effectively separate what they say and do in their leadership role from who they really are.

Truth:

Leaders’ thoughts, attitudes and behaviors affect everything. Great leaders understand that with power comes responsibility. Their strengths are their team’s strengths. And—you guessed it—their weaknesses are their team’s weaknesses.

What’s Next

To help you get a clear mental image of the leadership definition, picture an orchestra conductor—baton in hand. They lead scores of musicians without ever making a sound. It’s wild! They set up the rules, the signals, the musical roadmap—and they get every artist to make absolute magic.

The power of a conductor depends on making other people powerful. They work like crazy to awaken possibility in those they lead and help them tap into the conviction that they’re creating something special together, something worth their energy, talent and time. “If their eyes are shining, you know you’re doing it,” said Benjamin Zander, a former conductor for the Boston Philharmonic Orchestra. That’s a picture of leadership at its best.

Are you ready to develop your leadership skills and build a deeper bench of leaders in your business? The book EntreLeadership, by #1 national bestselling author Dave Ramsey, offers even more leadership tools.

If you want to take it a step further, check out EntreLeadership Elite, our membership that teaches and equips business owners to develop as leaders and grow their businesses.

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners. Learn More.