The Lloyds Bank - National Business Awards UK 2017   

 

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From entrepreneur to leader

From entrepreneur to leader

18 Sep 2013

Guy Rigby explains the difference between a good manager and a great leader

Being an entrepreneur is just the beginning, writes Guy Rigby, head of entrepreneurial services at Smith & Williamson. To build a successful and sustainable business requires strong leadership and management. As businesses grow it’s important to recognise the shift in skills required. It’s also important to acknowledge that management is not the same as leadership. They are not interchangeable.

Reducing owner-dependency

A huge part of the early stage owner-manager’s time is spent fighting fires, because everyone – customers, staff, suppliers – see the founder as the hub and the hero of the business; the person that the entire business revolves around. This role can be self-perpetuating because the more problems founders solve for others, the more likely they are to retain the role of chief firefighter. This period of development can be self-limiting and prevent the business from growing.

So what’s the way out? To break through this frustrating glass ceiling, entrepreneurs need to begin to build infrastructure, recruiting people to take on some or even most of the responsibilities that were once their personal domain. In practice, however, human nature and an all-too-common reluctance to let go can make this fundamental behavioural shift difficult.

Owner-managers often feel that nobody is as good as they are. Yet, in order to become good leaders themselves, they need to recognise the value of helping others to develop, taking a long-term view on the personal development of their team and empowering them at every level.

A vital behavioural change is therefore required. Delegation, empowerment and trust are critical if the entrepreneur is to evolve and assume the role of strategist: thinking about what’s next; looking forward, outward and upward; establishing relationships to enable growth and shaping the business for the future. In other words, moving from working in the business to working on it. Rather than spending time solving, checking, training, selling and doing, time should be spent thinking, trusting and, crucially, leading.

What makes a great leader?

Great leaders spot potential and unlock it. They allow other people to prove their worth, progressively ‘passing the ball’ and enabling others to take over non mission-critical tasks before delegating full responsibilities.

There’s always a temptation to meddle, but meddling has a detrimental effect on the business. Faced with constant criticism and micro-management, the management team gives up or quits and the owner-manager reverts to being the ‘hero’ and limits the growth of the business. Continuing to run day-to-day operations at a detailed level or meddling simply doesn’t work in the long-term, yet it can be hard to recognise this until it’s too late.

Trust is an essential part of the journey from entrepreneur to leader. Trust defines leadership. Founders won’t unlock the potential of their teams unless they build trust.

Management and direction

One of the factors preventing entrepreneurs from successfully navigating the journey to leader is often a lack of confidence around managing others or a lack of knowledge about appropriate management styles.

Styles of management generally boil down to the amount of direction and inspiration required to maximise productivity and maintain a motivated workforce. Every organisation and every individual is different. Some people need pushing, others don’t. Some people like to be led, others like to lead. Some are proactive, others reactive. What’s important is understanding the motivations of the management team and how to lead them to deliver the optimum business performance.

Guy is a Shortlist Judge for the Smith & Williamson Entrepreneur of the Year award. For further information on strong leadership and management, contact Guy Rigby on 020 7131 8213, or email guy.rigby@smith.williamson.co.uk.

 

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