The quality of leadership is one of the most important factors in determining the success and survival of groups and organizations. The purpose of this paper is to examine effective mangers Malaysian leadership. The objective was investigated on how mangers can have better understanding of leadership and to use it to their advantage. In addition, this paper also examined to what extant Malaysian leadership 'managers reflect the level of their social interaction, preference for gathering data, preference for decision-making, and style of making decisions. Finally, it identified several ways on how effective managers could reduce the gap between the difference in their leader to capitalize the strength of their counterparts in order to enhance organization performance and at the same time grasp new ideas so that it could benefit both sides. This study attempted to find out the effect of functional and behavioral competences on the leadership effectiveness in relation to managers in the construction industry in the Penang and Butterworth states in Malaysia. Functional competences were technical knowledge, managerial knowledge, communication knowledge, IT knowledge, legal knowledge, financial knowledge and business knowledge; and behavioral. competences were social/vocational knowledge and intraprotessional knowledge. Based on the literature review, theoretical framework was developed and hypotheses were constructed. The finding has shown that all managers surveyed basically agreed that IT knowledge and the business knowledge are the most crucial competences that should be acquired to become an effective manager in the construction industry. On the other hand intraprofessional knowledge of behavioural competences was found to be the most important for an effective manager.