Leadership is a way of management that has always been very important and there has never existed a company without leader. Although people often consider leadership and management as synonyms, these two terms should be distinguished. Leadership is an important aspect of management and the separation of leadership from management has important analytical advantages. The main thing in leadership is in the process of follow-up, employees in an organization are expected to respect the rules and meet the demands of the leader. Guidance is also related to motivation and in the sense that if people understand the process of motivation, leaders can better evaluate their subordinates and create them a stimulating environment. The focus of the paper is to define and explain the term leadership and its related concepts. The paper will also focus on the behavior and styles of leadership and management in a small, medium and large enterprise. Leaders have a difficult task because they need to know their company well and they must be constantly aware of everything that is happening in their organization even in situations where tasks are delegated and passed on to subordinates. A successful leader has variety of skills (organizing time, delegation, presentational and interpersonal skills), coordinates the work of his company and is responsible for success and failure of his subordinates. The empirical part of the paper will cover the topic of leadership in Croatian company Hrvatske šume ltd.