There are a number of ways to look at leadership, but they all boil down to this. As the CEO, you want to be an effective leader.
The 5 Levels of Leadership.
One way to view leadership is as John Maxwell has written about in The 5 Levels of Leadership. The lowest level is Position Leadership – people follow because they have to. The next level up is Permission Leadership – people follow because they want to. The mid-position is Production Leadership – people follow because of what you have done for the operations. One more step up is People Development – people follow because of what you have done for them. Pinnacle Leadership – People follow because of who you are and what you represent.
The level of leadership does not translate to effective leadership. Effective is defined as successful in producing a desired or intended result. So the question is how can you be an effective leader? The general answer is that to be effective, you need to change how you lead as your company grows.
A Researched Foundation
Based on interviews and working with 650 CEO’s in 35 different industries, James Fischer was able to identify 7 Stages of Growth that firms pass through. In this research, he also found that leadership needed to change as the firm grows.
Starting a Business
In the beginning when a person launches a new company, the owner has a vision for the business and with only few employees, the leader can oversee and make all of the decisions. From his research, Fischer defined Start-Up as a firm with 1 to 10 employees.
He defined the next stage of growth as 11 to 19 employees which he called Ramp-Up. At this stage, the CEO is still dominate and able to effectively lead the firm. However, looking forward to the next stage of growth, the CEO needs to understand that in the future they will need to delegate decision making. Thus, they need to identify the 2 to 3 people who can step into new roles and responsibilities to effectively build the company.
Moving from CEO-Centric to Enterprise-Centric
The 3rd stage of growth is called Delegation which is a firm with 20-34 employees. The name explains what has to happen. “You must let go to let it grow.” As CEO you need to delegate not just tasks, but responsibilities. You must coach and develop those key people you identified in Stage 2. If you don’t make the shift, you will find yourself overwhelmed by more decisions to make than you can handle. If you don’t make the shift, it will impede your firm’s ability to continue to grow. At this point, you may be tempted to reduce the size of the company to get it back under control. You can’t move forward by moving back. Referring back to John Maxwell, a company can only grow to the level of competency of the leader.
Continuing the Growth
If you become effective in delegating to your management team members, then your firm will grow into Stage 4 which is Professional. At this stage the firm will have 35 to 57 employees. The Department Managers will be focused on effectively leading their department. They may become somewhat isolated without CEO oversight.
This sets the next stage of growth which is Integration. The firm will now have 58-95 employees. The department managers will now need to see how their department fits into the overall operation of the company. The CEOs job is to help these managers become an effective leadership team. The CEOs leadership skills are critical at this stage of growth.
Becoming an Effective Leader
So, how can you be an effective leader? The answer is by understanding what stage of growth your firm is in and then adjust your leadership accordingly. You need to grow and change as your firm grows and changes. If you fail to do this, you will slow, constrict, or stop the growth of your business.
Getting Started – A Test Drive
Fischer also identified other business issues a company will face as it grows. One of these are the 27 Challenges. The top five challenges change as the firm grows. Do you know your Top 5 Challenges? I challenge you to take the FREE 27 Challenge Assessment. It will not only give you better insight into your Top 5 Challenges, but you will receive a Special Report for your Stage of Growth. The Report will provide you with the following:
- 5 Biggest Challenges for your firm’s stage of growth
- Tools to Build Your Business
- 5 Non-Negotiable Rules for your firm’s stage of growth
- Business Building Blocks
- Getting Ready for the next Stage of Growth
To take the FREE 27 Challenge Assessment go to https://www.trwconsulting16.com/ and click on Take 27 Challenge Assessment.
TRW Consulting was created to help companies navigate the challenges that are typical for Stage 1 through Stage 7 organizations. We have designed programs, services and tools that are directly tied to the issues you’ll face at each stage of growth.
You can find over 14 articles on LinkedIn and my website that relate to the 7 Stages of Growth. Here is the link to a related one – When Everything in Your Company Changes – Ramp-up to Delegation https://www.trwconsulting16.com/everything-company-changes-ramp-delegation/.
Another resource is my eBook 4 Puzzle Pieces to Growing a Successful Business. You will find it on the home page where the 27 Challenges are located.