First, Xenophon recognizes that the best leaders are able to inspire people to do what needs to be done because they want to, not because they are forced to. This is essential in the profession of law enforcement, as police officers most often operate independently, with little direct supervision.
The second part of the quote deals with technical and tactical proficiency. True leaders must know the academic and practical applications of not only their own positions, but also the jobs of those they lead. If they do not, their credibility, and therefore their ability to have their people follow willingly, is compromised.
Xenophon goes on to say, "Thus he (the leader) can secure obedience from his men because he can convince them that he knows best, precisely as a good doctor makes his patients obey him." This comparison of leader to doctor segues into Xenophon's final and possibly most important and thought provoking point: "Also he must be ready to suffer more hardships than he asks of his soldiers, more fatigue, greater extremes of heat and cold."
So let me make the following analogy. Doctors and police officers also suffer many of the same hardships due to the nature of their professions. Sleep deprivation, changing schedules, intense situations, and high levels of stress are all good examples of some of these hardships. Doctors and police officers deal with these inconveniences because they are committed to serving people. This dedication is, in part, why the majority of society looks to doctors and police officers as leaders.
Consider the final sentence of Xenophon's quote and ask yourself: Who would most likely be required to put forth the lion's share of blood, sweat, and tears in 360 BC? My guess would be the workers, the slaves, the foot soldiers, or in other words, servants! But Xenophon is pointing out that leaders must be the ones to actually work harder than their subordinates in order to lead effectively. And the best leaders are the ones who make the commitment to serve their followers, thus learning what is required in order to gain willing obedience, the best kind of obedience.