An effective leader has to be technically competent in some discipline, particularly when leading a group of specialists. It is difficult for the leader to establish rapport with group members when he or she does not know what the group members are doing and when the group does not respect the leader’s technical skills. The importance of knowledge of the business is strongly recognized as an attribute of executive leadership.

Leaders at every level are expected to bring forth useful ideas for carrying out the mission of the organization or organizational unit. Knowledge of the business or the group task is particularly important when developing strategy, formulating mission statements, and sizing up the external environment.