Leadership in a Small Business

Aug 11 2020

In this post, I am going to show you why Leadership is a requirement in any business – even a small business.

I am then going to provide you with a simple challenge that you can try out in the next week, a set of simple steps or processes that you can use in your business.

But first, let’s start with why leadership is a requirement in any business.

Through the course of my career in developing and growing businesses, I have observed that business success depends on doing six things well.

These are Leadership, Planning, Marketing, Customer Fulfilment, Operational Efficiency, and Mastering Finance.

You can get my free Small Business Owners Growth Guide called The Six Business Success Factors (click on the link) but this week I want to focus on Leadership.

Very quickly, let’s talk about what Leadership is, and why it’s different from Management.

In a nutshell, Leadership encourages people to do their best and shows the way, while Management provides the tools and resources for people to do their best whether they do or not. Leadership needs to be inspiring whereas Management needs to be detailed.

The example is of a Master Stonemason when asked what the two stones on his cart were for. His answer: “I’m building a cathedral!”. The same question was asked of his worker who supervised the rest of the stonemasons. His answer? “They make the south-west corner.”

Both are right. Both are necessary – you cannot have a business with Leaders and no Managers to look after implementation!

While you might say it’s merely a matter of semantics, research has proven it is not merely how you define a word. The difference is largely one of natural focus. Leaders focus on the end and the benefits the solution bring; managers focus on systems and method.

Leaders can get lost without managers – a whole load of inspirational vision is pretty useless unless your stonemasons have the right tools and stone delivered to the right place at the right time.

You can read about the positive Act of Leadership in my free Small Business Owners Growth Guide called The Six Business Success factors by clicking on this link https://teikoh.com/Guide

But equally good managers can also lose the way without Leadership – well-resourced workers building a structure by rote will not produce an inspirational and beautiful cathedral where the beauty is in the detail combined with the right proportion and balance, even with the right technical plans.

So, having established that Leadership is different from Management and that both are needed in a business, let’s explore why a business – even a small business – cannot succeed without Leadership.

In this case, of a small business, I define “success” as being the best business that you can create and be really happy and proud of. Not merely a profitable one but one that fulfils the dream you first had when you started, including what it does for you, your family, your happiness, your pride and your lifestyle.

All businesses start with a dream (I call it your vision).

Whether you had an idea for the best mousetrap or you felt while working for the man that you could do it better, or you knew you were expert in something and wanted to be independent – the idea became a vision.

“This is how I would operate my business,” you said to yourself. In your mind, in small or large fashion you would have thought about what your days would be like, who your customers would be and how you would get on with them. In some part, your vision would have included what your successful business would look like and how that made your life better.

Nobody starts a business “to make money” because deep down, people start their own business to fulfil a purpose or to feel a certain way about it, and making money is the vehicle to get there.

But when you actually start your business, you are faced with a multitude of tactical, technical and mundane tasks – tax registrations, leasing a shop, printing stationery, hiring staff, setting up the books.

There are three things you can do.

First, you can tackle the mundane tasks as a Manager.

You utilise your managerial skills and start to plan and write down the actual steps you need to take in each task. You gather capital and resources and you put one foot in front of the other, telling yourself this is the way you don’t trip up.

Soon, the dream gets lost in the doing.

If you had a sound business idea, the business will probably do well financially, and it probably runs like clockwork. But the inspiration is gone and if you are in this boat, you will probably feel like you own a business so that you can work in it – you know, that same feeling when you used to work for “the man”?

The second thing you can do is to be a great leader, even if you don’t initially hire any staff.

So you inspire yourself with your Vision.

You translate that vision into great websites and colours for your logo. You publicise at your shop and on your website an inspiring vision statement, and you talk about it to your customers about why you are working for them and how you would like to help them.

As time goes by, things start to go wrong. Your BAS was lodged late because you missed a week of keeping the books. A customer complained because your delivery was late or it was incomplete. When you tried to finish a task you discover you didn’t have enough supplies and had to stop and start.

Again, if you had a sound business idea your business probably would not collapse – you’d find a way around all the technical details and patch the holes. But it takes a toll on your vision and every day is a hard day because you’re no longer sure you’re working toward the vision because you are dissatisfied.

Finally, the third thing you can do is be both Leader and Manager.

It is tricky, but you handle the technical and mundane issues by planning and ensuring the resources are there when you need them. You hire professionals to look after things you can’t or don’t have time to handle like keep the books and prepare BAS returns. You write up a simple set of procedures that you follow on a day-to-day basis or that you give new employees to follow.

At the same time, you show Leadership – to yourself, to customers and suppliers, and to any new staff that you hire.

You do this by reminding yourself every day why you are in business – your purpose and your vision – and you inspire yourself to get over the mundane tasks so that you build your business. You remind yourself not to get bogged down but to find a balanced solution (including hiring people best suited to do those tasks). You talk to customers with purpose and inspire them to believe you can provide the best benefit for them and to make them like doing business with you. You talk to suppliers by describing what you want from them and why so they are in no doubt that they need to meet your standards.

Importantly, you both manage and inspire new staff by giving instructions while putting them into the big picture so that, while they know the step-by-step procedures of their work, they also know why they are doing it and what bigger benefits it will give all of you as a collaborative team – something to be proud of.

So, how can you be an effective Leader in your small business?

Let’s try this seven-day challenge (go on, nobody’s watching)!

First of all, let’s start with the premise that you either think you are a good Leader, or you don’t; and that you think you are a good Manager, or you don’t – it doesn’t matter. Nor does it matter whether you hire staff or work on your own.

Let’s start from scratch today.

You should be reading this original post on Tuesday so let’s start there – all you need is up to 60 minutes a day for the next 7 days.

Tuesday:

Take 45 minutes – do it now – and write down a paragraph about why you started your business (What made you do it? What did you want to achieve? What emotions would it give you? What benefits would it bring to you?), and what your ideal business looks like (describe a “typical” day, what you do during the day, who you engage with and what that engagement looks like, what gets said, what gets appreciated, what you do to help customers and staff).
Then take 15 minutes to write down your tactical to-do list. If you have time make a few notes about “first-steps” in some of these tasks.
For the rest of the day, carry your Purpose and Vision description with you. Do your to-do tasks, but set an alarm on your phone so that every hour, without fail, you re-read your Purpose and Vision Statement and spend 5 minutes imagining how you would feel when all of it comes true.

Wednesday:

Take 30 minutes first thing in the morning to focus on yourself (and your staff if you have any). Reading your Purpose and Vision Statement, ask yourself how you (and/or your staff) should behave in line with your Purpose and Vision when you do your work today. Should you be more focused or systematic, and why in the overall bigger picture, what does that do to getting to your Vision? How would you explain that to yourself and your staff? How would you remind yourself and inspire your staff to behave in that way?
Write down at least 3 things you (and they) should do differently, and a sentence to explain why it helps get to the bigger picture.
Take 15 minutes to review your to-do list and make plans to implement some of those tasks during the day.
Take 15 minutes to walk around and talk to staff (or to remind yourself) about the Vision and the benefits to everyone once the Vision is attained.
Set an alarm every hour to re-read your Purpose and Vision Statement and to purposefully look for a staff member who is doing something right and praising them, explaining again why it helps attain the Vision.

Thursday:

Take 15 Minutes at the beginning of the day to re-read your Purpose and Vision Statement and think about how great it would be once you have attained the Vision – how would your life benefit?
Take 15 minutes to review your to-do list and make some plans.
Set an alarm every hour so you are reminded to re-read your Purpose and Vision Statement – and what it really means to you – and go look for something positive you can say about staff who are doing things that will help you get to the Vision.
Take 30 minutes at the end of the day to ask yourself, or to groups of staff members, what can you do better so that we are closer to the Vision? Should we change how we engage with customers so that they see how we live the Vision? How do we treat ourselves to make sure we work with satisfaction and efficiently? Is there anything we can do to be more profitable without moving away from the Purpose and Vision? What systems can be improved so that we can act like in the Vision?

Friday:

Take 15 minutes at the beginning of the day – yup, you got it – to re-read your Purpose and Vision Statement and make sure you really get to feel how good it would be for you, your family, and your staff once you’ve “got there.”
Take 15 minutes to review your to-do list and make plans.
Set your alarm every hour to re-read your Purpose and Vision Statement and go find something positive that your staff are doing (again, what’s important is that it is something they do that will help you get to the Vision, not just some random good thing). This time, make sure you inspire them with how they are helping to build the future.

Saturday:

Rest, but do find 10 to 15 minutes to read your Purpose and Vision Statement and really imagine what it would be like in the future when you are performing as you describe.
You can do this on Saturday or on Sunday, but do this during the weekend – take 60 minutes and think about the discussion you had late on Thursday. Taking each suggestion, look at how that would help you get to the Vision and decide which can be acted on quickly. Make some plans about how you can organise (manage) resources, time and people to get it done.

Sunday:

Rest and bask in the happiness of attaining your Vision during the day.

Monday:

Take 30 minutes in the morning to either implement the plans you made over the weekend to make changes or to get staff together and tell them what you’ve decided, how they can help, and how to manage the changes. Make sure you tell them why the first ideas were chosen (how they helped get to the Vision) and what you will do with the others.
Take 15 minutes to review your to-do list.
Set your alarm every two hours to re-read your Purpose and Vision Statement and to look for positive behaviours and praise people.
At the end of the day, take 15 minutes to review what you have learned during the week, and decide how you will continue this challenge into a daily set of behaviours.

So there, 60 minutes or less a day over the week, in order to think about and practice Leadership in your business.

Practice through knowing exactly what your desired outcome is and why it means so much to you and why it will benefit everyone who comes in contact with your business. Be inspiring, talk in positive ways by pointing out how individuals contribute to such a great picture that you can all achieve.

Maintain a daily focus on Leadership and over the next few months, I believe you will find that attitudes and motivation in your business will change by improving for the better. Basing the focus on the Vision allows you, and everyone involved, to focus on what really matters and not be too bothered about the mundane because it has to be done to get you there. What really matters is how you will all feel when you succeed. If you want to read more about Leadership, get my Small Business Owners Growth Guide.

The challenge balances Leadership with the need to display good management characteristics – planning, resourcing, implementing.

Both are required in a successful business, and we will focus more on the management aspects in a later post, so keep watching for these posts and read them!

Oh, and if you want to get my free Small Business Owners Growth Guide on the Six Business Success factors, you can click on the link here to get a copy https://teikoh.com/Guide

Next week I’ll give you a simple process to get into the Practice of Planning.