Leadership is an individual’s ability to motivate and inspire team members. Leaders empower employees to succeed within an organization and in their professional aspirations. A manager is responsible for guiding employees to carry out the tasks defined by their roles. Both leaders and managers are vital to your organization’s success, but managers aren’t necessarily leaders.

So what makes an effective leader, and why is leadership important?

Most Leaders Are Built, Not Born

While there are examples of natural-born leaders throughout history, leadership isn’t a natural, inherent trait for most. Instead, leadership is something that must be cultivated and developed.

Unlike managers, who are tasked with developing processes and holding teams accountable, leaders must develop specific traits to drive innovation and change in an organization. There are five habits common to all successful leaders.

1. Leaders motivate and inspire. The thing that sets great leaders apart is their ability to inspire others. Leaders don’t just tell team members what to do; they motivate them to take the necessary actions to reach their goals and succeed.

That starts with creating a clear, focused vision, helping everyone understand why it’s important, and showing individuals how they contribute to this overall goal.

Based on data from InitiativeOne Leadership Institute, inspirational leaders must:

• Care about their people just as much as the business

• Push for excellence from their teams

• Lead with both their heads and their hearts

• Seek to learn from others, not just teach=

• Develop others

• Value the input of everyone on the team

Leaders understand that to succeed, they need a strong team working alongside them.

“Leaders are essential to individuals and organizations when it comes to inspiring, motivating, setting goals and visions, innovating, and building relationships,” according to Eran Galperin, founder and CEO of Gymdesk. “A truly great leader is one who can effectively do all of those things—even in times of economic hardship.”

2. Leaders develop focused, forward-thinking visions. A clear vision serves as a North Star for your organization. Understanding and aligning with this vision helps team members work in lockstep toward a common goal.

A well-defined vision gives a team direction and motivates employees to keep going despite setbacks. This starts with a mission statement to define the purpose the organization serves for its customers or audience.

A successful mission statement must define the company’s goals, core values, and purpose.

Examples of mission statements from well-known brands include:

• American Express: Become essential to customers by providing differentiated products and services to help them achieve their aspirations.

• Workday: To put people at the center of enterprise software

• JetBlue: To inspire humanity–both in the air and on the ground

Effective leaders don’t just define their vision and mission; they use it to guide everything they do and rally everyone around it.

According to Barry Maher, author, speaker, and consultant, “The best leaders cut through the clutter and find the core of simplicity. They provide a clear vision and help others uncover a direct path to results.”

3. Leaders create relationships. Leaders cannot motivate or inspire team members without building real, authentic relationships. They must believe in their team’s ability, help them find the necessary resources to develop and improve, build trust, and lead with understanding and empathy.

“Day after day, people do not come to work for a time clock,” writes Frank Molinaro, vice president of human resources at Security First Insurance, in Forbes. “They come to work for a person. And for them to give anything other than the minimum, they must have relationships with that person.”

In business, leaders must not be dictators. They need to create a positive working environment where employees feel supported, especially in a post-COVID-19 era, where people value company culture more than ever.

“Empathy is a critical component in developing competent leaders and effective teams,” according to Douglas Ferguson, president and founder of Voltage Control. “It means having the ability to understand the needs of others. By showing genuine interest in the people around them—like learning about what inspires them and how they feel—they build deeper connections with employees in the workplace.

4. Leaders promote a culture of coaching. Leaders can’t be everywhere at once. But they can cultivate an environment that brings out the best in their team members by creating a culture where opportunities for coaching are built into the organization.

A coaching culture can include different modalities, for example:

• Mentoring

• One-on-one meetings

• Skill-sharing sessions

• Knowledge sharing

• Social and peer learning opportunities

• Workshops, webinars, and more

This environment creates a support system for employees and empowers team members to learn and develop new skills. But don’t limit coaching opportunities to individual contributors; it’s also valuable for managers as well.

“Coaching can have a multiplier effect for leaders in an organization because they set the tone for everyone around them,” according to Melissa Eisler, an executive coach and leadership development consultant. “If a manager lacks certain competencies like emotional intelligence, listening skills, or adaptability, it can be difficult to create a trusting, collaborative culture in the workplace. So it’s important to know what your blind spots are and where you need to grow.”

5. Leaders never stop learning. Successful leaders pursue a continuous journey of learning and personal development, encouraging others to do the same. This helps them stay agile, evolve, and adjust to changes and challenges.

Promoting this idea of lifelong learning helps leaders create resilient organizations that can stay ahead of the competition during times of rapid change.

"Who are the companies that will thrive amidst all this uncertainty?” asks Ted Blosser, co-founder and CEO of WorkRamp. “It's simple. It's the companies that can learn faster than everyone else."

Some individuals are born with natural leadership skills and traits, but that doesn’t mean others can’t learn and grow into effective leaders who inspire change and drive results. But there’s one thing all leaders have in common: They must never stop learning and growing.