What Is the Importance of Leadership?

Updated September 28, 2023

Leadership is a vital management function that helps to direct an organization's resources for improved efficiency and the achievement of goals. Effective leaders provide clarity of purpose, motivate and guide the organization to realize its mission. Regardless of your position, understanding the role of leaders can help you contribute more meaningfully to the accomplishment of your company's objectives.

In this article, we discuss the importance of leadership and its impact on the fortunes of an organization.

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What is the importance of leadership?

Leadership serves several functions crucial to the success of an organization. One of the most important functions of a leader is to provide a vision for the company. The leader explains the vision and what members of the organization must do to achieve it.

While an organization may have people with various talents and capabilities, it is leadership that harnesses individual efforts toward the collective goal. By inspiring and motivating teams and coordinating personal actions for the advancement of a common goal, leaders help their companies achieve excellence.

Related: What Does Leadership Mean?

Why do teams need leaders?

Teams often comprise multi-talented individuals who have the right skills and experience to deliver results. But most organizations still choose a team leader to direct the energy of the members for more effectiveness. Here are the reasons your team needs a leader:

Effective leadership

People have a natural disposition to follow a leader. Regardless of your level of knowledge and experience in a particular field, you can achieve more if there is a higher authority you report to. This is because a leader provides guidance and helps you minimize potential threats that can affect your productivity. A leader doesn't have to be a senior colleague, but they can still improve your chances of success through effective mentorship, accountability and delegation of duties.

Read more: 10 Traits of Highly Effective Leaders (and How To Develop Them)


Leaders have a clearer understanding of the team's purpose and what it must do to make it a reality. Effective leadership not only guides but identifies, understands and communicates the organization's vision to motivate others to support them to achieve objectives. During the designing and implementation of a project, it is the leader who ensures every team member understands their roles and provides an enabling environment to help them perform at their best.

Promote values

Team leaders can encourage others to take up essential values vital for the organization's success. If you are upright, honest, punctual and serve as a good role model to your team members, they will emulate your behavior. Values such as accountability and taking responsibility when things go wrong can also make the organization a better place for employees and clients.

Related: Core Values: 84 Powerful Examples for the Workplace

Promote creativity

Team leaders can also foster an atmosphere of creativity in an organization. While leaders help others see the vision of the business, they can also provide more flexibility on how employees do their work. This can help produce new insights on how to perform tasks, make decisions and deliver on projects, improving efficiency and productivity.

Read more: 8 Ways to Use Creativity in Leadership

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Why is leadership important?

Leadership is important for the success of an organization because it provides guidance, purpose and helps others understand the long-term strategies and goals of a business. Here are 11 reasons to value effective leadership:

1. Vision

Successful leadership creates a clear vision of what the organization can achieve. Leaders provide a roadmap outlining the steps and resources their company needs to arrive at the preferred destination.

Related: 14 Traits of Visionary Leaders

2. Communication

Leaders help to communicate the vision and mission of the firm to employees. This provides direction and helps everybody identify the roles that best fit skills and experiences. Through clear communication, leaders encourage their subordinates to act for the actualization of objectives.

Related: Leadership Communication: Why It's Important and How To Improve

3. Decision Making

Decision making is one of the top leadership skills. Successful leadership takes the best decision for the organization in all situations. Leaders are experts at taking the right decisions based on the prevailing circumstances. They weigh their organization's strengths and weaknesses to ensure their choices put them at an advantage now and in the future.

4. Passion

Leaders are passionate about their vision and infect others with their energy to achieve it. Effective leadership inspires others to buy into the company's objectives and provide a powerful reason for everybody to remain dedicated to their duties.

Related: The Importance and Qualities of a Good Leader

5. Guidance

Once employees know what to do to deliver on projects, effective leaders oversee their work to ensure they perform their roles effectively. Leaders make sure employee efforts align with organizational goals for improved efficiency.

6. Commitment

Effective leaders are committed to the success of their organization and its employees. They remain focused on the company's long-term goals and do not allow temporary setbacks to dampen their spirits. When they face a setback, good leaders motivate their teams and help them see beyond the problems preventing them from reaching the common goal.

Related: 9 Common Interview Questions About Commitment

7. Integrity

Successful leadership teaches the organization ethical values. Regardless of their problems, successful leaders do the right things to achieve their goals. For them, integrity, truthfulness and fairness are core attributes they want to see in their company and its relations with contractors and clients.

Related: A Complete Guide to Integrity in the Workplace

8. Confidence

Leaders help subordinates to excel at their work and every aspect of life by expressing confidence in their abilities. They listen to employees' worries about their work, provide positive feedback and ensure the office environment brings out the best in them.

9. Morale

Leadership boosts staff morale by winning their trust. It assures employees of the leader's confidence in their abilities to deliver on the vision and mission of the organization. High morale among employees reduces distraction and motivates them to devote their energies to achieve organizational goals.

Related: How To Boost Employee Morale

10. Growth

The best leaders create an environment where others can grow. They are open to new ideas and methods of achieving results and are flexible enough to admit their mistakes. Successful leaders encourage subordinates to provide inputs on how to improve work processes and reward excellence to increase creativity and loyalty.

Related: Opportunities for Growth: What They Are and Why They're Important

11. Coordination

Effective leadership balances personal interests with organizational objectives. Leaders know that employees have personal reasons for working with their company. They create an environment where the organization can achieve its goals without sacrificing employee satisfaction.

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