To truly unlock a business's full potential requires addressing two complementary aspects in parallel.
The first one is the business side: understanding the strategy, financials, planning, operations, product services, marketing, etc. Basically, all that comes together to make a business functional.
The second one is the people side: the individuals that make the systems work together and fulfill the organization's purpose.
Because many entrepreneurs frequently start out by themselves, they typically will focus more on the functional side of things to build enough of a profitable business to, let's say, start paying themselves.
But what happens is, as the business starts to grow, they still heavily favor the functional side to the detriment of the people side.
So what can micro-business owners do to ensure that they are growing the people at the same time as the business?
The first thing is to understand how leaders make the difference. Take a moment to really consider how they make a difference. Leaders are often needed to help navigate the organization through its changing environment. As the organization scales, as new team members are onboarded, as operational requirements evolve, these leaders will be there to help identify how to address these new challenges.
Although growth is typically a positive thing, it can also bring a lot of challenges. Having those leaders who are able to help manage that really makes all the difference. Leaders can also help drive innovation and increase client satisfaction. If they’re identifying how the needs are changing, how the organization is growing, how failures are turned into lessons learned, and how we are going to apply those, that will eventually improve the products, improve the services, create new offerings, and this will better meet the client's needs. And that will increase client satisfaction, which in turn will increase the likelihood of referrals.
It just builds upon itself as you continuously improve and increasingly help meet the client's needs and potentially even anticipate needs as well.
As the business grows, you learn more and more about what is missing in the offerings, what is missing in the services, and what potentially no one else is doing.
Perhaps it’s missing in your own organization, but maybe it is also missing in the industry as a whole. And leaders can help with that.
Another aspect that leaders help with is retaining amazing team members. As we know, we've heard it before, people tend to leave bad bosses as opposed to bad jobs.
That saying is very true. There are a lot of amazing team members who move on, due to the way they are being treated or how the culture is.
And if you have really great leaders within your organization, then there's a higher likelihood that you will be retaining these team members. I'm not saying that no team member will ever leave, even if you have the best leader ever. There are many other reasons why team members choose to leave. But leaders can help retain these amazing team members. And since turnover is costly, investing in your leaders will actually decrease your costs.
Another way that new leader development – or simply leader development – is key to the organization is, as I mentioned earlier, as the business grows, then there comes a need to learn to delegate and train.
It’s tempting to think we know how to delegate: “I just give everybody else my work.” No, that's not delegating. Delegating is more than just passing on a task. We have to take the time to explain what it is, train how to do it, support them as they ramp up and become proficient at doing the task. True delegation actually involves also checking in on how they are doing with the task. How are they feeling? And making sure that they are properly supported so that they can perform the task in a way that will be actually an asset to the organization as opposed to a detriment to the organization.
If they haven't really learned how to do a task properly, then there could be all kinds of mistakes happening, and they're not always perceptible until it's too late. So learning to delegate is also training the person on how to do it and explaining why it's done and the context of it. The more they understand, the better they can perform. Because if they have the full picture of how this task fits in, how it impacts the organization, how it is essential to this “machine” then the better they can adapt, modify, tweak, and improve how the task is done itself. So really taking the time to explain that is important.
Choosing the right type of training can be an investment. And that investment pays off because, with the right skills, the leaders can better understand what is needed. And if they better understand what's needed, they can train their own team with that information in mind. And then those team members can help the leader be an even better leader. And so there's this effect when you train this one person, do it properly, they will train the others, and then they will do their job even better because they also understand things better. And all of this really comes down to wanting them, helping them, supporting them to make better informed decisions. The better they understand this, the more likely they are to make sound choices that positively impact the organization.
At this point, you might be saying: “This all sounds great, I'm convinced, but we just don't have the money.” And I get that. Absolutely. If cost is truly an issue, look at other ways to make it happen.
For example, you could have an internal business book club where everybody reads the same book and you come together at lunch or something and discuss what you learned and how you would apply it to the organization or not. That could be a great way to see how others interpret the same written word, how others interpret pieces of advice and how various people see it applying to the organization or not. That is just one simple, pretty low-cost way of training the team. And that could be an opportunity as well to say: “Okay, I see this applying this way because XYZ, and then this ties into our long-term plan.” It opens up those potential conversations. Another example could be exchanging services. Maybe there's another organization similarly-sized who is going through comparable challenges and would be happy to exchange services with you. And then the two of you could complement each other and train each other's teams.
I've been focusing a lot on training the leaders and how that is key to the organization. There still needs to be a balance between the functional aspect and the people aspect.
Being an entrepreneur leading an organization requires constant juggling between the two. It is a constant back and forth. One day, it’s a little bit more the functional side, the next, a little bit more on the people side. For example, you know you're having trouble with your services and offerings, and your clients aren't happy. You ask yourself: “Okay, is it in the way that we're delivering it or is it because our team members have lost touch with why it's important and doing it properly?”
And so you're constantly juggling between those two worlds. And, although I am talking about training people and emphasizing the need to train people, it is important to remember that the best talent in the world can only make up for broken systems. They can only make up so much for broken systems because if you have a broken recruiting pipeline or you have a broken delivery pipeline or something of the sort, even if your team members are fantastic, but you have functional operational holes, these need to be addressed to allow the team members to do the best jobs possible so that they can better serve the clients.
Keep in mind that, even if you have the absolute best people, if you just focus on the training, it will become problematic. It really, really is that balancing act between the two.
One of the benefits of identifying which needs more attention at which time, because it does go back and forth, like I mentioned, is that if you do recognize what you really need right now. And perhaps it is to train your leaders.
Once you do, then those new leaders can help identify the problem areas, and they can help identify that earlier and they can help fix them earlier on as well. It creates a form of improvement effect. You start improving your operational side – your functional side –, it impacts on team members, and you start training your team members and then it impacts your functional side.
In terms of what to tackle first, start with the mindset. That's really where it all begins.
Recognize that it's important to train your leaders even if it’s not possible to address right now. As I mentioned earlier, if money is an issue, then you may not be able to do the things that you need to be doing, but at least, if you keep it in mind, at some point you will find opportunities.
And so start with that mindset and then remember that ultimately investing in the development of new leaders and yourself as the owner can lead to increased revenue for the business while improving the work environment for all.
Team members will be more motivated. They will be more interested. And this will, in turn, impact on the product and services and will likely make for happier clients.
There won't be much profit to invest in the beginning, and that's likely an issue if you're really a micro business or maybe a solopreneur that is just starting to add team members and starting to grow, but do what you can without compromising the organization.
Just remember that it's both sides. You don't want to overly focus on one at the detriment of the other. They go hand in hand. And, as the business grows, include regular skills development training into the strategy in whatever form makes sense for the profits that you can reinvest. Because investing in the development of your new leaders is truly essential for the long-term success of any business.