In their early years, most small businesses don’t require a significant amount of leadership, per se. After all, the business is usually comprised of just the owner and perhaps a few employees. Things can be done in a relatively ad-hoc manner as long as everyone knows their roles and responsibilities.
But as a small business grows, so does the need for effective leadership. The business owner must evolve from simply being part of the business to being an active leader of the business.
And frankly, this can be challenging for small business owners. After all, they probably didn’t receive any specific leadership training. Their training consisted of learning how to be a plumber or electrician or HVAC tech. They must learn how to be an effective leader.
All of which raises the critical question: what makes for an effective leader in a small business?
What’s different from an average leader to a highly effective, motivating, inspirational leader?
In this post, we’re going to look at 8 qualities of outstanding leaders.
Let’s dive in.
1. Inspirational Leaders Have A Clear Vision Of Where They Want To Go
First and foremost, an effective leader has a clear understanding of where they currently are, as well as a clear vision of where they want to go. They can articulate this vision passionately and clearly to their team so that each team member understands how their work contributes to the overall goals of the company.
Writing in Forbes, Deep Patel puts it like this:
Exceptional leaders have the ability to look into their company’s future and make clear, concrete goals that will benefit their organization. They are confident and optimistic, inspiring enthusiasm in those around them.
If you don’t have a clear vision of where you want to take your business, ask yourself these questions:
What’s the most important thing to me as a business owner?
What achievements would make the most difference in my life, the lives of my employees, and the surrounding community?
What do I want my business to stand for?
What sort of legacy do I want to leave behind?
When people think of my business, what should be the first thing that comes to people’s minds?
Answering these questions should help you get clarity on what matters most to you as a small business owner. You can then communicate these values to your employees and other stakeholders. Read this to learn what leadership advice other renowned leaders in the trades have for you and what values they communicate to their employees.
2. Effective Leaders Set Goals and Persist In Achieving Them
The most effective leaders are relentless in the pursuit of their goals. Not only do they know where they want to take their company, but they are doggedly persistent in working to make that vision a reality.
When they encounter an obstacle, they don’t let it dampen their enthusiasm. Rather, they press on toward achieving their goal, doing whatever it takes to overcome the obstacle. They keep on going even when others may be tempted to give up.
3. Effective Leaders Lead With Integrity
President Dwight. D. Eisenhower said:
The supreme quality of leadership is unquestionably integrity. Without it, no real success is possible, no matter whether it is on a section gang, a football field, in an army, or in an office.
The most effective leaders are very clear on their values and they let those values drive their decisions and actions. They’re clear on what is right and what is wrong, and they hold fast to those truths. They don’t let circumstances determine how they will act. Rather, they let their values determine how they will respond to circumstances.
When they make a promise, they keep it. They are honest in all their communications and treat people as they want to be treated. Effective leaders are ethical at all times, refusing to bend their principles.
The simple reality is that with integrity, a leader can achieve great things, and without integrity, a leader will never truly be outstanding.
4. Effective Leaders Lead By Example
Effective leaders understand that the best way to gain the trust and respect of their employees is to lead by example. They model and demonstrate the behavior they want to see in their employees. If they set a high bar for their team, it’s only because they first set a high bar for themselves.
Before complaining about employees underperforming, think of ways to empower and make your techs more productive. When a small business owner leads by example, the employees are much more likely to follow.
Your teams look up to you and if you want them to give them their all, you will have to be passionate about it too. When your teammates see you getting your hands dirty, they will also give their best shot. It will also help you to gain the respect of your subordinates and infuse new energy in your team members, which helps them to perform better.
5. Effective Leaders Are Accountable
The best leaders understand that, just as employees must be held accountable for their actions, so they too must be held accountable. The most effective leaders always hold themselves accountable, acknowledging when they made mistakes or made a poor decision.
They also work within established policies and procedures. They don’t act as if they’re somehow “above the law”. Rather, they hold themselves to even higher standards than their employees.
6. Effective Leaders Make Hard Decisions
There will be many times when a small business owner must make a challenging decision with limited information. In those moments, they must not back down or waffle. Rather, they must realize that they are the only one who can make the decision, and make it they must.
What should you do if you find yourself needing to make a difficult decision with limited information? At a high level, you should...
Consider all the alternatives before you. Is there an obvious best choice? If so, go with that one.
Consider the consequences of each decision. Will one decision have significantly more negative consequences than another? If so, avoid that one.
Make your final decision with conviction. Take full responsibility for the outcome.
When your employees see that you’re willing to make hard decisions and take responsibility for them, it will increase their respect for you.
7. Effective Leaders Communicate Clearly
Being able to communicate clearly is an absolute necessity for leaders. Communicating clearly doesn’t just mean speaking whatever is on your mind. Rather, it means listening carefully to what others are saying, clarifying any misunderstandings, asking probing questions, and sharing important, mission-critical information.
The most effective leaders know how to clearly communicate what is needed at any given moment.
When a leader can’t communicate clearly, mission-critical tasks get missed, projects are delayed, and offenses between employees arise.
8. Effective Leaders Recognize and Reward Success
If a leader wants his employees to give their best, then he must be able and willing to recognize and reward their achievements. When employees stretch themselves and give their best effort, it’s absolutely essential that their work be recognized. If it’s not, they’ll quickly become demoralized and unmotivated.
The most effective leaders are creative in the different ways that they recognize good work. Sometimes they use verbal praise. Other times they give gifts. Still other times they call out the employee’s efforts in front of the entire company. If this is done consistently across the board, the end result is that all the employees are motivated to give their best for the company.
9. Effective Leaders Empower Others
The best leaders understand that, while they may be the one in charge, they also must give their employees a sense of ownership over their work. They know that micromanagement is demoralizing and that if they want their employees to do their best work, the work must be meaningful.
By giving clear goals and deadlines to their employees, and then letting the employees determine how they will meet those goals and deadlines, the effective leader gives the employees a freeing sense of autonomy.
Are You An Effective Leader?
Don’t be discouraged if you find yourself lacking in any of the above areas. The simple truth is that everyone has room to grow as a leader. Instead of becoming discouraged, think of each of these attributes as a goal.
Make it your goal to become a better communicator or to hold yourself more accountable or to more effectively reward your employees. Take small, simple steps every day that will help you grow in these areas.
As your employees see you striving to grow, it will inspire them to grow as well.
You truly can be an effective leader. You just need to put in the work.
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