How to build a foundation for exponential business growth

Growth is a balancing act. Grow too quickly, and you run the risk of over-extending your organisation. Grow too slowly, and you may be eclipsed by the competition.

Growth is critical for an organisation to survive, yet two-thirds of the fastest-growing companies will fail. This is because growth operates as an accelerator: all the positives and negatives of a business are amplified during a growth phase, and businesses that are not prepared for rapid growth will quickly find themselves falling apart.

Limited resources, exhausted employees, and a disruptive work environment can all eventually take its toll, even on a business that appeared to have strong fundamentals.

In order to handle growth, a business needs to start with a firm foundation.

Training and retaining your employees during growth

Employee retention is the top concern for employers in 2017 — and rapid expansion only compounds this problem. Not only are human assets the foundation of any business, but losing human assets during the process of expansion can be exceptionally disruptive. The cost of training a new employee can be many times that employee’s monthly salary, and cycling through employees during a growth cycle is a fast track towards business disruption.

During expansion, employees may find themselves having their day-to-day tasks interrupted with a continuous flow of challenges. They may not feel as though a structure is in place to adequately reward them for meeting these challenges — and ultimately they may find themselves fatigued. During aggressive expansion, employees may also wonder what their position will be once the structure of the organisation changes, and they may feel uncertain regarding their future with the business.

To counter this, employees need to be trained specifically to handle growth phases. Management must be clear and transparent regarding the changes that the employee will experience — and management should further go out of its way to identify and reward its star employees.

Constantly foster innovation

Regardless of industry, innovation is considered to be the key driver of business growth. It may not always be possible for a business to have superior resources than its competition, but it is always possible for a business to find a way to do something better.

Businesses can only gain an edge during rapid expansion by fostering innovation and looking towards improving upon their operations, processes, products, and services.

Innovation can be best fostered in a business by encouraging employees to explore new ideas. Creating a company culture of openness and creativity can naturally lead to innovation, even during times of aggressive expansion and growth. A culture of innovation will additionally keep employees engaged and constantly improving, thereby also improving upon employee retention.

New business processes, new products or services, and new ways to service clients all fall under the banner of innovation, which is critical for business survival today. An innovative business is an agile business and a business that will be able to evolve with its growth.

Streamline business processes

Everyone knows that small businesses have a tendency to fail during expansion due to a lack of capital. But what is less explored is why large successful enterprises fail. This is usually a matter of a lack of innovation and optimisation. As businesses become larger, they become set in their ways and processes become entrenched — even if they may not necessarily be the most ideal.

Businesses need to be open about identifying bottlenecks, finding solutions, and validating their own assumptions. Well-designed business processes must be documented and analysed, and a business process should be available for every task. Otherwise, a business can quickly fall apart as it grows, as employees will not be able to follow direct strategies for handling customer complaints, processing orders, servicing clients, creating products, and more. As growth rates accelerate, these processes become even more important.

Identify the value in technology

Technology is a major asset to any organisation poised for growth. Through technology, businesses are better able to leverage their existing infrastructure, competing with businesses larger than themselves, and increasing their own stability. Businesses that do not invest in technology run the risk of being left behind; a decade ago, the cloud was virtually unheard of, yet as of 2015, over 90% of businesses had invested in some form of cloud-based infrastructure.

Enterprise resource planning, customer relationship management, and logistics and shipping platforms are all designed to optimise and improve upon business operations. Ultimately, this also improves upon a company’s ROI, which is absolutely critical during the intense stages of business growth. Businesses need to start implementing these suites now rather than later, so that their organisation has already integrated them fully into their business practices as they grow.

When it comes to growth, firm business foundations are what make the difference between success and failure. As a leader, your primary goal is to make your business foundation stronger to sustain it throughout these periods of aggressive growth and expansion. If you want to learn more about reviewing and improving upon your business systems and foundations, contact TEC today. TEC can give you complete access to experienced professionals with invaluable insights into business growth and management.

How to manage your star employees

Employees are what drives a business — and that’s why businesses are always competing for the best talent.

Industry professionals have estimated that up to 90% of an enterprise’s value is driven by its intellectual capital, but you don’t need to rely upon such abstract estimates. It’s already known that the average employee costs six to nine months of their salary to replace.

With all this in mind, it becomes necessary for CEOs and managers to focus on both acquiring and supporting their best employees. Unfortunately, model employees tend to disappear beneath the problem employees, making them feel unwanted and undervalued.

It’s a CEO’s job to ensure that all employees feel satisfied and recognised — especially the ones that are doing the most for the business.

Foster your team relationships

The Pareto Principle tells us that the top 20% of our employees will complete 80% of the work. By the same token, the bottom 20% of our employees will take up 80% of our time. This is what can cause a solid employee to disappear under a morass of more difficult ones. But when you manage a business, you aren’t managing just the top employees or just the bottom employees; you’re managing them all as a team. There will always be overachievers and underachievers, but you need to work with all of them effectively.

When employees work together, they are more likely to feel rewarded by a task successfully completed. Team-building exercises and corporate events can be used to further deepen and build upon these relationships, in addition to the foundation that a strong sense of company culture provides. A sense of camaraderie and team spirit is often enough to make employees feel like a valuable member, but the danger is that they may also feel as though they aren’t being rewarded for their direct and unique contributions.

Recognise and reward individual employees

Creating a company culture of recognition is important. But rewards don’t necessarily need to involve money. In fact, both public and private recognition are often rated more highly. Employees don’t just want to feel directly recognised; they also want to feel as though they have a future with the organisation and that they will continue to develop their career. What’s more, while 24% of employees found recognition from their CEO the best, 28% found recognition from their direct managers preferable.

Communicate with your employees through bi-weekly meetings

Regular one-on-one meetings, even quick stand-up meetings to check in, are a great way to tell your employees what they’re doing correctly and to get any feedback on what managers may be doing wrong. Many companies are blindsided by employees who appear to leave suddenly, when the departure really wasn’t sudden at all. The employee was simply never given the opportunity to directly address their concerns. When given a chance, most employees will be straightforward about their own goals with the organisation and what the organisation could be doing to better serve them.

Training and development opportunities

Employees today are not loyal to their companies; they are loyal to their careers. If they feel as though their careers aren’t advancing at the rate they expected, they’re more likely to jump ship. The solution is to offer a steady stream of training and development opportunities. Employees want to be able to do their jobs well; this gives your top-performing employees their time to shine.

Training and development directly benefit the organisation itself. As employees become more effective, they become more efficient at their tasks and more capable of operating autonomously. Though the company may need to invest directly in these training and development opportunities, they will ultimately achieve a substantial return on their investment.

Employees may also be given the opportunity to engage in transfer of learning, through which skills are diversified and employees are able to cross-train in different fields. Employees who are able to train in multiple fields are far more likely to be effective, as they are able to quickly adapt to the positions that the company requires. Transfer of learning is how some of the top CEOs are able to be so effective. It is also instrumental in grooming top-performing employees for management positions.

By improving your employee retention, not only can you reduce your hiring costs, but you can also boost your employee satisfaction by up to 22%. Though this isn’t an easy task, it can be achieved by building a company culture of employee recognition from the ground up. As a CEO, managing your employees is a balancing act; you need to be able to reward your outstanding performers while still managing the employees who are struggling. Mentorship and advisement can help. Through TEC, you can connect with other entrepreneurs and CEOs who are facing the same hurdles and developing their own employee management strategies. For more information, contact TEC today.

Most popular TEC articles so far in 2017

TEC’s blog is comprised of an extensive list of resources suited to the eyes of SME CEOs and executives. If you missed one of our weekly posts, below is a list of our top blog articles thus far in 2017.

 

1. The guide to organisational structures (flat vs hierarchical) 

An organisation’s structure forms the very basis of its operations. As a company grows, the impact the structure can have is significant. Read the guide to choosing and changing your organisational structure to suit your business’s needs.

 

2. Authentic leadership and what it means for culture

Is your approach to leadership authentic? It plays an important role in shaping your business’s culture. Learn how you can be the most authentic version of yourself.

 

3. 5 leadership styles and when to apply them 

Are you one of the 36% of organisations that don’t have a formal leadership development strategy? The relationship between leadership styles and employees play a crucial role. Learn the five most popular leadership styles here.

 

4. Are you a manager or a leader? Three essentials lessons from Inspire CA 

Do you manage people, or do you lead the way for them? 46% of all startups fail due to general incompetence in leadership. Learn how to be a leader here.

 

5. Adding the why back into goal setting

Perhaps it’s time to revisit those New Year’s resolutions. Ensure the goals you set are driven with clarity and purpose. These tips will help you identify why these goals are important and how to set goals that you value.

How to have difficult conversations with employees

In an interview with 200 executives, it was discovered that 53% of executives admitted to avoiding difficult conversations because they felt they didn’t have the training or the experience to handle them. Of those who avoided conversations, 97% did so because of the stress that it caused them — and 80% were concerned that the conversation would escalate into anger. The role of a CEO is no different; difficult conversations with employees are stressful. Unfortunately, they are still necessary.

Being able to tackle difficult situations in the workplace is a defining characteristic of a CEO. A true leader doesn’t just manage difficult conversations; they excel at turning difficult conversations towards a positive goal. But all of that takes experience and self-awareness. Here are some of the key factors to mastering difficult conversations with employees.

Set the right tone 

It’s important to start any conversation with a positive tone — otherwise, you can easily put your employee on the defensive. Handling a difficult conversation is very much about reducing the emotions that are in play. An emotional person will not be receptive to your feedback and your direction. There are many things that can influence the tone of a conversation:

  • Environment. Being ‘called into the office’ can be stressful in and of itself, and it’s important to understand that your employee is already going to have their guard up. Consider an alternative approach, such as walking up to your employee and asking them, ‘Would you mind having a talk with me in the conference room?’ For difficult conversations, neutral territory may be best.
  • Body language.It can be difficult to control your body language, especially if you yourself are upset or frustrated. As a CEO, your employees are going to take their cues from you; if you seem agitated and upset, they will be as well. Keep your body loose and relaxed, avoid any aggressive movements, and take some time to just breathe.
  • Mindset. What is your ultimate goal for this encounter? If it’s a combative one, then the encounter will probably be combative. Your mentality going into a difficult conversation should be to ask about the other person’s point of view and to work together to find a solution.
  • Opening. Your opening sentence should be inclusive rather than, ‘I need to talk to you about something,’ say ‘May we talk about something?

It’s important to align yourself with your employee so that you can work together during the conversation. While you may feel that the employee themselves is a roadblock or that they have caused a situation, it is still true that you and the employee are going to need to work together and resolve it. As a CEO, this bigger picture will override any smaller frustrations.

Be clear about the issue, but don’t oversimplify the problem

Effective leaders are able to convey complex topics in simple terms, but that in itself can be an art form. When describing an issue, CEOs need to achieve a balance between being concise and being clear. There can be a temptation to oversimplify an issue — either to get the conversation over with or to gloss over some of the negativity. Unfortunately, that gives the employee an incorrect perception of the issue. They may not treat it appropriately or even take it seriously. Eventually, this leads to frustration, as the leader perceives a problem that the employee still does not.

  • Don’t go into unnecessary detail. When describing an issue, discuss only the facts that are pertinent to the employee — and only give enough for the employee to both understand the issue and understand the desired outcome. The employee doesn’t need to know the intricacies of the situation. They need to know what to do to complete their work more effectively.
  • Ask questions to determine whether the employee fully understands the issue. What is clear to you may not necessarily be clear to the employee; after all, you have more data to work with regarding the situation than they do. Rather than assuming that the situation has been resolved at the end of the conversation, ask the employee questions — such as what they will do next to resolve the problem.

Communication is all about clarity, and clarity often requires brevity. Complex situations should be distilled into a few concise statements; this will ensure that the employee will understand the issue and be able to appropriately tackle it.

Prepare for the meeting, but do not rehearse

As a CEO, it’s likely that quite a lot of your life involves preparation. The more prepared you are, the better the outcome. Having difficult conversations is no different. Before you tackle a difficult conversation, you need to have as full an understanding of the situation as possible. You should understand the facts of the situation, be able to articulate why it is an issue, and have suggestions for moving forward.

But preparation is far different from rehearsal. When you’re concerned about a conversation, it would be easy to go over it many times in your head. But eventually you would end up developing a script — and scripting can be dangerous. When you operate from a script, you stop listening to the other person. You are no longer able to effectively communicate with them and answer their questions. Instead, you’ll find yourself going back to your script, again and again.

Avoiding rehearsal will make it easier for you to connect directly to your employee and to listen to them. Remember: your prior knowledge may not always be accurate, and you may not always have a full picture of the situation. Being open to your employee means that you can be open to changing your preconceptions and open to solutions that may differ from the ones that you had previously devised.

Know your objectives, stay positive and future focused

It’s easy to get derailed through the course of a conversation, especially a difficult or defensive one. This may involve becoming bogged down in arguing details rather than looking at the bigger picture. Rather than seeking to position themselves at an indefensible point (such as whether or not a project was delivered late), defensive employees may begin to argue finer points (such as who was responsible for delivering a specific part of the project late).

This can be avoided by remaining positive, staying on track, and focusing on the future. It’s always possible to argue what has happened in the past; it is less possible to argue about what needs to happen going forward. Practically speaking, the major concern is not who was guilty or culpable; it’s being assured that the situation will not occur again.

Regardless of the content of the discussion, it must always end with a clear, concise goal for the future. This is what gives your employee something to focus on moving forward.

Master the art of conversation

As a leader, you have to be able to tackle difficult conversations head-on. Developing this talent will serve you well throughout your career, and will lead to better business outcomes throughout your organisation.

It can be difficult to face frustrated or aggressive employees, especially when you are perceived as opposition rather than help. Luckily, you’re not alone. TEC’s network of experienced, knowledgeable CEOs can help give you tips that have served them well throughout their tenure, developing your social skills and building up your network. Contact TEC today to find out more.

The impact of Impostor Syndrome on CEOs

70% of millennials have impostor syndrome; it’s a growing trend in the modern world. First discovered in the 1970s, impostor syndrome is typified by a constant and persistent belief you are not as competent as you are believed to be. Understandably, impostor syndrome is most often found in those who have elevated or high-pressure positions: doctors, scientists, and, of course, CEOs. These are individuals who have received consistent accolades and success but still feel that it has been unearned. CEOs who suffer from this syndrome feel uncertain, anxious, and guilty.

As CEOs, you are often called upon to make difficult decisions that have widespread consequences for your employees, customers, and shareholders. Often you may need to make a decision that will have a negative impact on others, in the best interests of your organisation.

Exploring impostor syndrome and CEO guilt

If impostor syndrome is the cause, then CEO guilt is the effect. When you feel as though you are somehow unworthy of your appointment, any decision you make is going to feel that much dire. Consider a CEO with impostor syndrome who is forced to lay off a large number of employees. Due to their impostor syndrome, they may then be haunted by a number of questions:

  • If I were a better CEO, would I have been able to save those jobs?
  • Why should I still have a job when I’m clearly just pretending?
  • Could the company be headed towards failure because of me?CEOs with Imposter Syndrome

Of course, these questions are unfair: they are based on the premise that the CEO is not doing a good job and that they could have somehow avoided the situation. Most importantly, impostor syndrome means that you believe that you are not as good as other people think you are. It isn’t just that you feel incompetent; it’s that you feel as though you are a fraud.

The impostor syndrome impacts any successful demographic. Though it’s often been posited that female CEOs are the most likely to experience impostor syndrome, it’s actually fairly equally split over all genders and demographics. Anyone can feel like an impostor — but it may have a more negative impact on women and minorities, who may also have other factors working against them.

Triggers

A lack of confidence may actually be a major component of success, so it makes sense that successful people will find themselves in moments of self-doubt. Successful individuals are those who are never satisfied with themselves, those who are always clamouring for more. These are people who expect only the best from themselves — and are therefore harder on themselves in the wake of perceived failure.

 

The only way of avoiding this is learning to recognise (and react to) the triggers.

  • If you have recently experienced a professional failure, such as a mismanaged business acquisition, it may be easy to assume that you have finally failed enough to be found out. In this situation, failure is considered to be your default state — even if you have failed very infrequently — and you may feel as though it’s been a long time coming. You may feel as though all your successes were sheer luck but that the failure is evidence of your own incompetence.
  • Conversely, impostor syndrome can occur if you receive rewards or recognition that you don’t feel that you deserve. You may question why you’ve received this award and you may feel anxiety associated with accepting the reward; what if they realise they made a mistake?
  • On the path of career development, you may begin to feel impostor syndrome once you have completed a large project or accomplished something great. When the glow of success has worn off, you will be left contemplating your next project and fearful that it will not go as well.

CEOs in the Impostor cycle

Management

We now live in a world in which most people experience some level of impostor syndrome. But this type of self-doubt can be absolutely more crippling for you than it would be for an average individual. As a CEO, you need to be extraordinarily self-aware; otherwise, you may make emotionally led decisions rather than carefully considered ones. You can begin managing your impostor syndrome by not only identifying your triggers but also responding mindfully to allay their effects.

  • Talk to others. Impostor syndrome is rooted in the idea that others have a perception of you that differs from reality. Talking to others directly and discussing your concerns is an excellent way to resolve impostor syndrome; after all, if they can recognise your faults but still believe you’re right for the position, then you aren’t ‘putting one over’ on anyone at all. You may also find that the person you’re talking to feels similarly.
  • Don’t consider imperfection a deal breaker. There is no such thing as a perfect CEO. Even the most successful CEOs in the world still make mistakes. Understand that any of your imperfections or mistakes aren’t deal breakers; they are learning experiences and opportunities to change.
  • Try to focus on the positive. There are areas where you surely realise that you are an expert or a specialist — and you know that you wouldn’t have gotten as far as you have without unique talents. By focusing on where you’re good at rather than where you’re bad at, you can feel more confident in your role.
  • Adopt a mindset focused on growth. Rather than focusing on your own shortcomings (either real or imagined), you should instead focus on the areas that you want to improve. This can radically reframe your methods of thinking: rather than being focused on getting caught, you can instead focus on being better.
  • Avoid the compulsion to downshift. One of the most insidious consequences of impostor syndrome is often the urge to downshift — to step down in your career plan and avoid responsibility. Before making any drastic changes to your career (such as stepping down as CEO), you must court other opinions.
Two types of mindsets that can be adopted by a CEO

Fixed vs Growth mindset

Managing impostor syndrome

Everyone has moments of feeling ill equipped to deal with the challenges that life has presented them with. A true leader and a truly successful individual can recognise these doubts and can still move forward in spite of them. Though you will undoubtedly have moments in which you feel as though you do not deserve your own success, these are just moments — and they will pass. For a CEO, it is simply important that you continue to keep moving, growing, and succeeding, in spite of your concerns.

Impostor syndrome and CEO guilt are best managed by reaching out to other individuals and talking about your concerns. It’s lonely being a CEO — but most of what you’re going through are more common than you think. Through TEC, you can gain access to a large network of accomplished individuals who are having the same experiences. Not only will you be able to request guidance from those more experienced and knowledgeable than yourself, but you’ll also be able to aid those who are still at the beginning of their journey. For more information, contact TEC today.

How important is emotional intelligence in leadership?

Leadership isn’t just about IQ or technical skill – in fact, these are the entry-level requirements for executive positions. When 58% of all success in jobs are accounted for by emotional intelligence, it’s a clear sign that emotional intelligence has a vital role in the workplace. It has also been discovered that people with a high degree of emotional intelligence make an average of $29,000 more per year than people with lower degrees of emotional intelligence.

What is ’emotional intelligence’?

In the 1990’s, psychologist Daniel Goleman coined five main components of emotional intelligence that affect leadership:

1. Self-Awareness
Self-aware leaders have a clear picture of their strengths and weaknesses. This skill also allows them to be aware of how they’re perceived by others. Having this knowledge, better equips them to respond in a way that delivers the results they need.

2. Self-Regulation
Self-regulation allows leaders to control their emotions when making decisions or responding to certain situations. Leaders with self-regulation rarely verbally attack others; make rash decisions or compromise core values.

3. Self-Motivation
Motivation is passion that goes beyond the material of money and status. This is about being fundamentally driven by a purpose deeper than something that might not last. Self-motivated leaders consistently work towards their goal with a high standard for the work they produce.

4. Empathy
Leaders lead people. Empathy is the ability to successfully manage a team of people by understanding their drivers and emotions. It’s through empathy, that a leader can help develop the people on their team, challenge them and give constructive feedback.

5. Social Skills
Social skills relate to conflict resolution, communication skills as well as forging strong relationships with others. Leaders with strong social skills are good at managing change and set an example to others with their behaviour.

Aside from these five core characteristics, there is also: charisma, confidence, the managing of relationships, and the regulating of one’s own expectations. These all fall under the banner of emotional intelligence. To be truly inspiring and memorable, a leader has to be able to display these characteristics.

How Jeff Bezos (Amazon) displays emotional intelligence

In 2015, Amazon found itself in the cross hairs of The New York Times, following the publishing of a lengthy critique about its rigorous employee standards and harsh working environment. It may have gone even further, if it wasn’t for the swift intervention of CEO Jeff Bezos.

Jeff Bezos was able to use the opportunity to turn the criticism around, by announcing changes within the company and directly addressing the concerns that had been raised. Rather than fighting the claims, he leaned in, and was able to deliver the changes that his employees and the public desired.

How Larry Page and Sergey Brin (Google) display emotional intelligence

 One of the best examples of overall emotional intelligence comes from Larry Page and Sergey Brin, the two initial founders of Google. Now one of the largest organisations in the entire world, Google still reflects the atmosphere of a spunky start-up. Much of this has to do with their emotional intelligence. As a business grows, it’s often normal for the culture to dilute or change radically. It’s only through emotional intelligence – an understanding of the drivers of their employees, of the context of the business – that Google has been able to retain their playful company culture.

Well-known for their corporate code of conduct, “Don’t be evil” Google has developed an entrenched reputation as a well-meaning and forward-thinking corporate entity. The success behind their strategic initiatives also relates back to the emotional intelligence of their executive team and their ability to be ‘ahead of the curve’.

(Since the inception of Alphabet, Google’s motto has been replaced by “Do the right thing.”)

Do you possess emotional intelligence?

Emotional intelligence may very well be the line in the sand that separates a “boss” from a true leader. Through emotional intelligence, CEOs and entrepreneurs are able to inspire confidence and motivate others to follow in their footsteps. And, just like any other skill, it can be learned.

With over 21,000 members, The Executive Connection has turned the development of emotional intelligence into a science. Contact us to find out more.