“Managers have a plan, Leaders have a dream.”

I am often asked, “What is the difference between managers and leaders?” Libraries’ are filled with books about the subject. Here are three ways that will help you understand the difference.

First, are you counting value or creating value? If you are managing people you are counting value, not adding value. Only managers count value. Some even reduce value by trying to micro-manage those who add value.

Distracting a diamond cutter by asking him to report every 15 minutes how many stones he has cut his “manager” is subtracting value. In the end people do not want managed, they want led. You manage things, not people!

By contrast, leaders focus on creating value by saying, “I’d like you to handle “A” while I deal with “B.” Leaders generate value over and above that which the team creates, and is as much a value-creator as are the team members. Leading by example and leading by enabling and empowering people are the hallmarks of great action-inspired leadership.

Second, are you creating circles of influence or circles of power? Just as managers have “direct-reports” and leaders have “direct-supports,” managers create circles of power while leaders create circles of influence. Influence trumps power every time.

The quickest way to figure out whether you are a manager or a leader is to count the number of people outside your reporting hierarchy who come to you for advice. The more people that do, the more likely you are a leader and not a manager. Managers provide answers and directions, leaders provide opportunities and options.

Third, are leading people or managing the work? Management consists of controlling a group of people and a set of challenges to accomplish a goal. Leadership is the ability to influence, inspire and enable others to contribute toward the teams’ ultimate success. Influence and inspiration separate leaders from managers, not power and control.

In India, M.K. Gandhi inspired millions of people to fight for their rights while he walked shoulder to shoulder with them so India could achieve independence in 1947. His vision became everyone’s dream and ensured that the country’s push for independence was unstoppable.

Martin Luther King did not give a “I have a plan speech” he gave a “I have a dream speech” and the future of The USA changed forever. The world needs leaders like Gandhi and King who think beyond problems, have a vision and inspire people to convert challenges into opportunities. Leaders never let the managers stifle their dream, they ask them to come up with a plan to make it happen.

I encourage you to invite your team for a talk. When they stop discussing the problems and tasks and start talking about vision, purpose and aspirations instead, that is when you know you have become a leader. When your dream becomes the team’s dream great things will happen!

Every organization needs great managers, those who watch the radar, react and execute the plan. However, without great leaders who create what gets on the radar and lead the way into the unknown, there is no future—only a rerun of yesterday.