Managing the ‘business growth versus leadership growth’ juggle
In times of crisis it’s tempting to focus only on revenue generation, but neglecting your employees can have dire consequences. The most successful organisations know that good leadership is about investing in your people.
In order to achieve long-term business success, managers must recognise their role in building high performing teams that deliver results consistently. This means that managers need to invest in their own leadership capabilities, whilst genuinely understanding the link between powerful leadership and successful business growth. It’s largely through dedicated investment in training and coaching that managers can really hone the skillset required to nurture high performing teams that stick around.
Many organisations are overlooking the hard truth that emotions drive people, and having excellent ‘soft’ skills will make or break their businesses.
Ironically, business growth is often prioritised ahead of leadership capability. One could argue that this makes sense for most organisations, given that revenue and profit are required for survival. A lot of management teams seem to be missing a trick, however, and overlooking the fact that no matter how good you are at ‘doing business’, you still need to excite, entice and inspire your people to follow you on your journey.
When leadership matters most
The significance of decent leadership has never been highlighted more profoundly than during the Covid-19 era. This unusual situation has put unprecedented pressure on businesses of all shapes and sizes. Organisations are managing costs down to cope, and this means many are eliminating training and development budgets entirely.
Ironically, it is at times like this that leadership is tested to its limits on a daily basis. The ongoing uncertainty – and the regularity with which we’re encountering situations that are unpredictable and out of our control – means that people are looking to their leaders for direction and reassurance. Despite this, many organisations are overlooking the hard truth that emotions drive people, and having excellent ‘soft’ skills will make or break their businesses.
Why investing in leadership pays dividends
Leadership done well means that organisations will retain top talent, whilst this top talent will be motivated to perform in the interests of the organisation. When it’s done badly, employees will feel like cogs in the wheel, dispensable and under-valued. When the time is right, the best talent will seek and take advantage of other opportunities where their value is appreciated, and businesses may be left with a team that is far from high performing.
High performing individuals combine to create powerful teams that drive outstanding business success. A focus on the financials is always going to be top of mind for management teams, but the argument for a more strategic, long-term plan is smart and appealing – a plan that encourages teams that thrive and want to work towards a common goal. These teams will be filled with creativity, energy, commitment, trust and a drive to get results. Which organisation wouldn’t want this? Despite this, we often can’t see the wood for the trees and we neglect to invest in our people. The key to creating high performing teams starts with quality leadership.
Convincing managers to invest in leadership
There are several factors to draw to their attention. These include:
Impact on productivity: it is certainly important to get the balance right between good leadership and business results. Whilst the numbers will almost always come first, people need to be appreciated. Psychological safety is a crucial element of top teams, and this can easily be destroyed in a moment. People need to feel appreciated, engaged and inspired by their leaders. In turn, they will go the extra mile and feel more connected to the organisation’s cause. They will be happier, and we all know that we work at our best and are most productive when in a good state of mind.
Impact on employee turnover: investing in leadership training will also impact the churn rate, as good leaders are able to pre-empt potential employee issues, mitigate them and recover from them far more effectively than those who do not possess these skills. Bain’s pyramid of employee needs illustrates how:
- Inspired employees are stimulated by leaders (this isn’t easy when you’re not an inspirational leader).
- Engaged employees learn and grow every day (without focused investment in formal training or good leadership above, this doesn’t happen).
- Satisfied employees have the tools, training and resources required to do their jobs well (without decent leadership or investment in training, this is difficult to achieve).
Impact on the bottom line: in an ideal world, it would be very easy to measure the impact of an investment in leadership on an organisation’s profitability. We need to give evidence that it makes sense from a financial perspective. Being an intangible asset, good leadership is hard to quantify but it definitely shows up in colleague engagement surveys, sick leave, churn rates and output. The hard statistics generated from these areas will give you a strong indication as to whether your organisation needs to reconsider its investment and perhaps dial it up.
Remember, the best time to invest in your leadership capabilities is before you actually need to leverage them. Sow the seeds well in advance, so that you’re ready to navigate challenges and unexpected situations. A business in nothing without its people.
Interested in this topic? Read Panic and the coronavirus pandemic: immersive leadership during a crisis.