One of the most important characteristics of a successful business is good leadership and in the small to medium sized enterprise (SME) space this means that owners must be good leaders and leaders need to think and act like owners.
Leadership is incredibly complex, especially in the SME space and many leaders feel they have to be experts in everything. Whereas in the corporate world, leaders are surrounded by experts in most areas.
Generally leaders in SME’s have specific technical expertise and usually have little or no business management training, yet to be successful you have to be an entrepreneur, a leader and a manager - and be good at all three. However the reality is you can’t be good at everything and continual leadership development is critical to the long term health and sustainability of any business.
The ability to understand leadership and identify leadership qualities isn’t about being an expert in leadership training however assists in many other areas such as, employing and developing future leaders and fast-tracking your own personal development.
The subject of leadership means many things to many people, and the following is a collection of what I have found, in my extensive experience, to be the key characteristics of successful leaders in business.
These outlined characteristics are meant to promote thought, discussion and even a little self-evaluation.
Ability to see an opportunity
Leaders are able to see, evaluate and pursue profitable business opportunities. As the old saying goes “you can't eat potential”, but a good leader has the ability to turn opportunity into reality. Good leaders are able to continually adapt and reinvent opportunity as it changes over time.
Do you still see the opportunity in your business?
It is essential that leaders establish a clear and enduring business purpose including what a business does and why it does it. They also need to be able to convert the business purpose into a “pitch” which includes the important messages to get across to key people, both internal and external including staff and prospects.
Do you have a clear purpose for your business?
Once the purpose is established it is essential that a leader creates a clear vision on what the business will look like in the future. That vision must then be communicated to all key stakeholders, especially employees so they have a clear path to follow. Leaders then take that vision and develop a plan to turn it into reality.
Do you have a clear vision for your business?
It is almost impossible to achieve results in business without being incredibly passionate about your business, your people, and your customers. I believe this passion is achieved from having a clear purpose and vision and it is this passion that creates motivation.
Are you incredible passionate about your business?
To create a truly long term sustainable and profitable business you have to be innovative. Leaders must encourage and create innovation in all critical aspects of the business. They must build an innovative culture which means having a go and putting the spotlight on failure as a key positive learning for the business.
Do you encourage and are you an active innovation participant?
Who you know
Leaders work hard to establish a network of key people who can help the business achieve its objectives. This network will include customers, suppliers, alliance partners and equally important, mentors and advisors.
Do you have the right connections to be successful?
What you know
There are skills that leaders must have to be successful which includes knowing how to plan, knowing how to get the best from your people, a comprehensive understand of finance and marketing, being able to identify what makes a business successful, being able to problem solve, and knowing how to make continual changes in business. Leaders must have these core skills to be successful and must know their skill gaps and seek help to achieve their goals. Leaders must have a huge appetite and continue to want to learn.
Leaders must be aware of their own strengths and weaknesses, the business strengths and weaknesses, the market opportunities and threats, the customer needs, your competitors strengths and weaknesses, and most importantly, the need for change and how much you must have. If leaders don't know, they ask a lot of questions to find answers, they understand not knowing is not acceptable.
How are your skills and knowledge to run a successful business?
How you manage others
One of the most important characteristic of a great leaders is the ability to manage others. If leaders look after their people, your people will look after your customers and your customers will purchase again and provide your profitability. The key elements are understanding that everyone is important, employing the right people with the right attitude, training, appreciation, recognition, respect, engagement, communicate, empower and most importantly build a lasting culture and don’t forget, train for character and not just skills.
How well do you manage others?
It is about how you act, often termed the characteristics of good leaders. They listen before they speak, ask lots of questions, ensure the vision is communicated, inspire others to follow, lead by example, be visible, earn respect and trust, have the hard discussions, make decisions and respect others. Leaders have energy, ask the difficult questions, are highly self-motivated with an ability to motivate others and most importantly live and breathe their core values.
Are there areas of your character that could be improved?
How you manage yourself
You have to be able to manage yourself before you can manage others, you have to effectively manage time, be able to prioritize, work on the right things, focus on the key drivers, know when to say no, get things done through others, continually strive to improve yourself and most importantly be disciplined.
How well do you manage yourself?
Achieve results not excuses
Leaders are remembered for what they achieved and not how hard they worked. They have an ability to make things happen, achieve results and most importantly they don't make excuses. The primary reason they are able to do this is their ability to focus on the things that matter, they continually prioritize and ensure they work on the right things. They ensure they spend a percentage of their time working on the business and not in it.
Do you regularly achieve what you set out to do?
As it can be seen, effective leadership is dominated by how you act, which is very true when you observe great leaders. They act like great leaders and it is this behavior that differentiates them the most. If you can't behave like a leader it is impossible to be one.
We all have our strengths and weaknesses however you must continually work on improving your leadership capability and capacity with resultant business performance improvement and personal development and satisfaction.
How would you consider your leadership capacity and capability? Try answering the questions in the article and identify the one area that if you improved would provide the most significant improvement to you and your business. Then obtain some help to develop strategies to address these areas.
I hope you found the article thought provoking and helpful in understanding how leadership has such a major influence on the profitability, the performance of your business and your own personal development.
If you would like some assistance to develop your leadership skills and help you to address your number one priority or to obtain copy of our leadership audit, please contact;
Simply Business Australia
Philip Coombs “The Profit Coach”
0419 834 678