The success or failure of a company lies in the ability of its leader to lead it through the different stages of growth that it will go through. It is essential that entrepreneurs know and understand their roles and responsibilities as leaders of their companies.
Building a Business vs. Building a Company
As a leader, you need to make a choice between building a business or building a company. When you build a business, you create an enterprise and make money from it. If you decide to stop, the business collapses.
On the other hand, when you build a company, you don’t just build a business. You also create an organization with the right structures, systems, and culture. Keep in mind that a successful company has several businesses. However, to build a strong, growth-oriented company, it is your prime responsibility as a leader to:
- create and define the company mission and vision;
- specify the values on which the company will operate;
- create the appropriate company culture; and,
- establish systems, structures, and procedures.
Hiring the Right Kind of People
It is also your job as a leader to make sure that you choose and hire only the right kind of people for the job. Don’t just look at their credentials. Look for people who are also self-motivated and who share your values. Moreover, they should be customer-focused and are able to change and deal with crises.
Above all, they should help you and the company to achieve its goals, particularly in times of trouble. However, never hire people who are mere clones of you. Value diversity and choose people who will compensate for your shortcomings. For instance, if your accounting skills are weak, hire a CFO and conduct an outside audit regularly.
Focusing on the Essentials
Your roles and responsibilities as a leader will change with each new stage of development that your company will go through. The ability to change and assume new roles and responsibilities separates great leaders from ordinary ones. Set the tone and the priorities of your company. Stay focused and don’t allow employees, yourself, or your partners to get distracted.
Take calculated risks. Don’t bet everything on just one venture. Moreover, don’t be a spendthrift. Make certain that your expenditures add value to the company. Furthermore, keep track of your progress and lead the company through the different transitions of its growth. If you feel you can’t do this, step aside and ask help from people who could.
The ability to manage people is also a sign of a great leader. In addition to having good leadership skills, entrepreneurs and business owners also need to develop good management skills. You can’t just assume that the organizational needs of your company will somehow take care of itself.
Management is all about creating systems and standardizing processes. It is essential for business owners to understand their responsibilities in building an organization and managing people. You can teach people the technical skills that you will require from them, but you need to make sure that they already possess the core strengths in people, customer, and crisis management.
For a company to grow, you need to have good people. Once you have selected and hired the right kind of people, be sure to put them in positions where they will do extremely well.
In addition, spend more time with high performers and learn how and why they are successful at their jobs. Afterwards, coach and help poor performers get better. If after some considerable time, the poor performers still fail to perform up to speed, don’t hesitate to fire them. Your company and its reputation will be affected greatly if you don’t.
Furthermore, make sure that your employees understand the company’s goals. Help them set personal goals that are congruent with the company’s goals. Then, help them accomplish those goals. By helping your employees reach their potentials, you also enable your company to realize its own potential.
No matter how good you are as an entrepreneur, you can’t do everything or be present everywhere at all times. Learn to delegate responsibilities to your employees. This will enable you to effectively lead and manage your company, as well as instill a sense of pride in your employees. In addition, empower your employees.
Give them guidelines, develop the right systems and procedures that will enable them to make important decisions when required, and hold them accountable for their actions and decisions. Let them do their jobs and provide them with opportunities where they can put their expertise and knowledge to good use. Above all, always keep your employees and teammates focused on satisfying customer expectations.
It pays to plan ahead. Make sure that you establish firm strategies, guidelines, and systems to address the varied changes and challenges that accompany growth or crises. As the leader set the tone and the priorities of your company. However, it is wise if you surround yourself with motivated people who are used to making the right kind of tough decisions for each type of situation.