Management is the process of setting and achieving organizational goals through its functions: forecasting, organization, coordination, training and monitoring-evaluation.Leadership is: the ability to influence, to make others follow you, the ability to guide, the human side of business for "teacher". Interest in leadership increased during the early part of the twentieth century. Early leadership theories focused on what qualities distinguished between leaders and followers, while subsequent theories looked at other variables such as situational factors and skill levels. Other considerations emphasize aspects that separate management of leadership, calling them two completely different processes.The words manager and lider are very often used to designate the same person who leads, however, they represent different realities and the main difference arises form the way in which people around are motivated. The difference between being a manager and being a leader is simple. Management is a career. Leadership is a calling. A leader is someone who people naturally follow through their own choice, whereas a manager must be obeyed. A manager may only have obtained his position of authority through time and loyalty given to the company, not as a result of his leadership qualities. A leader may have no organisational skills, but his vision unites people behind him. Leadership and management are two notions that are often used interchangeably. However, these words actually describe two different concepts. Leadership is the main component of change, providing vision, and dedication necessary for its realization. Leadership is a skill that is formed by education, experiences, interaction with people and inspiring, of course, practice. Effective leadership depends largely on how their leaders define, follow and share the vision to followers. Leadership is just one important component of the directing function. A manager cannot just be a leader, he also needs formal authority to be effective.