At breakfast with an old friend this weekend he told me about an incident in his firm where a project manager referred to one of his software developers as “Resource Number Two.”

Not in the third person. Not in a written report. To his face.

The manager saw nothing wrong with this; after all, people are the only resource he has. The developer, on the other hand, saw it a bit differently. Like, as a major insult.

As a leader, keep one rule in mind: you manage resources, you lead people. Each task is essential, and each task is different.

Defining management would take a lot longer than a simple blog post. For our purposes let’s just say that management addresses the efficient use of resources. How do I get the most out of what I have, how do I avoid using everything up too soon, how do I avoid having an unnecessarily large inventory? These are important, and a manager who controls the use of non-living things can use these things while focusing on the repercussions in terms of finances and operations.

When your resources are people, though, you need to exercise leadership. The individuals working for you and the talents and skills they bring are your most important resources, and you can’t treat people like inanimate objects. You need to deal with things like recruiting, retention, motivation, mentoring, development, and other issues that you do not need to worry about when controlling only money or material.

You can be a manager, and only a manager, if you only work with things. But when you are working with people you need to exercise both leadership and management, and one thing a leader needs to avoid doing is treating people like they are merely interchangeable, and expendable, pieces of equipment.

It is possible that this project manager saw the word “manager” in his title as a sign that management is all he needs to do, so all he has to worry about is the efficient use of resources, without worrying about the touchy-feely leadership stuff. But when people are your resources, then you need to go beyond timelines and cost-benefit analyses; you need to address the individual needs and opportunities presented by your employees. That requires leadership.

And for the record, calling somebody a “resource” instead of calling them by name is probably pretty high on the “Don’t Do This” list of leadership.