What Is the Importance of Leadership? (Plus Purpose)

By Indeed Editorial Team

Published 11 July 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Leadership is a fundamental management function that helps an organisation allocate its resources in an efficient ratio to achieve the best results. Great leaders positively influence the workplace and bring about necessary changes to improve its functioning. They motivate and guide employees to work towards achieving the organisation's mission while additionally helping them attain their maximum potential. Knowing about the importance of leadership can help you understand your purpose in an organisation. In this article, we discuss the importance of leadership, specify the purpose of an effective leader in an organisation and detail the qualities of a good leader.

Related: What Is Leadership? (With Key Elements of Leadership)

What is the importance of leadership in an organisation?

Leadership is an essential management function that helps bring all the departments in an organisation together to work towards achieving the same objective. It provides an organisation with a vision and the means to achieve it. While every organisation may have professionals with various skill sets, talents and capabilities, leaders help them apply their talents to reach a common goal and improve the overall functioning of the organisation.

Related: 15 Leadership Qualities You Need to Be a Great Leader

What is the purpose of effective leadership in an organisation?

While there may be professionals from different backgrounds with various talents and strengths working in an organisation, it's important for them to synchronise their energy and work towards a common goal. A good leader can help them achieve this objective. Here are points that highlight the purpose of effective leadership in an organisation:


Great organisations typically consist of employees who understand their potential to develop and use that energy to achieve personal and professional growth. Under the guidance of an effective leader, employees have a better understanding of how they can undertake and perform tasks better. Good leaders can help employees be more purposeful in their daily jobs and bring the same purpose to their personal lives with enthusiasm and vigour. A good leader can help employees identify obstacles in their growth and can provide them with tips on how to overcome them.

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Good leaders can effectively communicate an organisation's goals, vision and mission to stakeholders. They can ensure that team members put plans and policies into action in a timely and effective manner by communicating the needs and timelines of the organisation. This helps employees understand what role to undertake, depending on their experience and skills. Effective communication is important for every organisation as it helps in the decision-making process and enables teams to meet deadlines.

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Leaders can help an organisation succeed by instilling confidence in their staff members through multiple means. By listening to the grievances and worries of employees, leaders can support them by giving them positive feedback and advice. When leaders are confident in themselves, they may have a similar effect on the people surrounding them. An organisation is likely to excel if the people who comprise it are confident about their strengths and have the power to overcome any hurdles they may encounter.

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Once a leader assigns tasks to their team members, they proceed to undertake the responsibility of making sure they complete the tasks on time and efficiently. Leaders are present for every step of the process to ensure they can clarify any doubts or help employees find solutions to any challenges they may encounter. While there are deadlines for employees to meet and schedules to follow, good leaders use positive reinforcements to help employees complete an objective on time. They help further the goals of the company by guiding employees in the right direction.

Related: 10 Types of Leadership Styles


Great leaders have a vision for the organisation and break it down into short-term and long-term goals to provide stakeholders with clarity on the organisation's future. They're capable of creating a plan with attainable objectives to achieve within a stipulated period. Once they have a framework of the plan, they finalise details such as resources required, steps to take and methods to use to achieve this vision.

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Proactive leaders are creative thinkers and tend to foster creativity among their team members. While they help their team members understand their roles better and channel their skills and talents towards achieving organisational goals, they also apply creative techniques to improve productivity amongst the team. Using creative methods to complete a task while maintaining efficiency makes work flexible and enjoyable for employees and can provide insights into new ways to perform tasks.


When leaders are passionate about their work, their team members are influenced and inspired by their passion. Passionate leaders encourage their team members to achieve their goals and align them with the goals of the organisation. The growth of organisations largely depends on the behaviour of their employees and passionate employees are likely to put in more effort to ensure the success of their organisation.


Efficient leaders can boost the morale of employees by acting as a constant source of motivation. They trust their team member's decisions and abilities to execute objectives by placing their confidence in them and leading them in the right direction. When leaders encourage employees in a positive manner, the quality of work improves and the organisation can shift its focus on achieving bigger goals to help fulfil its vision.

Decision making

A good leader can execute quick thinking and decision-making skills when an organisation requires it the most. Making quick and well-informed decisions is important for enabling an organisation to grow and overcome any challenging situations it may encounter. Leaders make decisions by carefully assessing the situation and considering multiple factors to ensure the outcome is beneficial for the organisation and its employees. They analyse the organisation's strengths to establish the best way to handle any situation.

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Leaders establish responsibility among employees by helping them understand their objectives and using their talents and skills to achieve those objectives efficiently. This promotes a sense of accountability amongst employees to attain a predetermined target and approach leaders for help if they require it. The workflow of an organisation improves and runs smoothly when employees are accountable for their actions and duties.


Good leaders understand that every individual working in an organisation has goals to pursue. They help align these personal goals with the common objective of the organisation. When employees know the work they're doing contributes to their personal growth and furthers their own agenda, they may provide better quality work, have higher morale and possess an excellent work ethic. Leaders find and establish a balance between personal and professional goals for their team.

Qualities of a good leader

Good leaders possess qualities that help them contribute to the overall growth of an organisation. Here are some of them:


Leaders understand that completing all the tasks in an organisation on their own isn't feasible and thus they might delegate tasks to other employees and team members. A good leader knows how to delegate the right tasks to the right people depending on each individual's workload. An effective leader might also be able to demonstrate that they trust their team members by delegating work to them, which can motivate them to provide good results.

Related: How to Identify Team Strengths and Weaknesses (With Examples)

Patience and empathy

Great leaders understand the true value of employees and spend a considerable amount of time hearing their concerns. Leaders are patient when certain objectives aren't met by employees due to any challenging situations they might be facing. They're empathetic in their response and try to understand and help solve any issues to ensure employees feel heard and respected.

Problem-solving skills

Leaders are aware of the problems that may occur during the workflow and know how to resolve them. They're equipped with excellent problem-solving skills that help them make practical decisions and reach sound conclusions that benefit the organisation. They can predict future problems based on past reports and are well-prepared to handle them beforehand.

Related: Problem-Solving Skills Examples (With Steps to Develop Them)


Successful leaders are aware of their strengths and weaknesses. Being self-aware helps them understand their shortcomings and areas for improvement. They work towards being the best version of themselves and are open to learning along with their team members. When a leader is self-aware, it improves the well-being of the organisation as there's complete transparency of work.

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