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What leaders know?

What distinguishes effective leaders from mediocre ones?

Is it their ability to make good decisions, their charismatic persuasiveness, or the clarity of their vision? And do the best leaders have these qualities naturally, or were they acquired at college?

The good news is that you can learn to be a leader, just as long as you take time to learn fundamental leadership skills. However, your effectiveness depends on how you apply these skills.

So, what do you have to learn if you want to be a better leader? And do you need to go business school to learn these things, or can you learn them on the job?

J. Sterling Livingston, a professor at Harvard Business School, attempted to answer these questions by studying the connection between formal education and successful leadership. In 1971, he published "The Myth of the Well-Educated Manager" in the Harvard Business Review.

One of Livingston's conclusions was that a formal business education, such as an MBA, was not a good predictor of long-term leadership success. This finding is much less surprising today than it was back in the early 1970s. However, his other main observation is as relevant today as it was back then – namely, that four key skills define successful leadership.

By developing your skills in these fundamental areas, he argued that you can lead people, and inspire them to change. You can also be dynamic and effective in how you tackle the challenges you face every day.

Let's look at these four skill areas in more detail.

Decision Making

Leaders need to be able to solve problems effectively and make good decisions. But decision making and problem solving skills are commonly taught – so, with all those problem solvers out there, why can good leaders be so hard to find?

According to Livingston, the difference often lies in your approach to finding solutions. If you deal with a problem believing that you have to find the "right answer," this can actually lead to failure. After all, you can analyze a problem forever, and still not be 100 percent sure that your solution is the best. The only way to assess your decision is by looking back, after the fact. Even then, there are sometimes too many variables to determine whether or not you definitely chose the right course of action.

Effective leaders use practical and responsive approaches to decision making. They know that you can't wait to make a perfect decision: when you're in the middle of a situation, you have to be confident enough to do what needs to be done right now. This means you must quickly evaluate the situation, and take an action that has a high probability of success. The decisions that these leaders make under pressure may not be perfect, but they're consistent with the desired outcome.

  1. Good decision making.

  2. Successful problem finding.

  3. Effective opportunity finding.

  4. Leadership style.

Terms reprinted by permission of Harvard Business Review. From “Myth of the Well -Educated Manager” by J.Sterling Livingston. Copyright © 1971 by the Harvard Business School Publishing Corporation; all rights reserved.

Good leaders also know that problem solving and decision making aren't entirely rational processes. We all have emotions, so completely objective decisions don't really exist.

Successful leaders therefore use critical thinking – a technique that questions every step of their thinking processes – to manage the subjective side of decision making.

Ultimately, what sets apart effective leaders is that they know how to decide. They know when to take the time to use analytical and thorough decision-making processes. They know when to engage the whole team, and when to make decisions on their own. This knowledge doesn't come from a book, but from practical experience. As a developing leader, look for opportunities to make decisions in a wide variety of situations, so that you can gain that experience.

See the Mind Tools decision-making skills section to learn a wide range of specific decision-making techniques.

Problem Finding

Leaders don't simply solve problems that people bring to them – they look for problems that may be hidden. In other words, they often recognize potential issues before they become significant.

The quicker you discover a problem, the more time you ha