Growth in a small-to-mid-sized business can be difficult to achieve. CEOs try to balance maintaining stability, improving upon products and services, and reaching new markets.
This can stretch a company and its employees thin, making it difficult to do any of these well.
If your company is struggling to find the right balance, it may be time to invest not just in a leader, but in the right type of leader. This would be one who will bring the skills and perspective needed to get to the next level.
Operations and Management
Operationally focused companies typically have a CEO who comes from an operations background. She’ll have experience in something like engineering, manufacturing, finance, or sales; all of which are targeted on the internal operations of the company.
What we have found regarding leadership in operationally focused companies is that the CEO tends to surround herself with other operationally focused people.
Her direct support staff are in roles that focus internally on the company, not outward growth opportunities.
The leaders of operationally focused companies are usually very happy with company performance. They think they are growing at the industry average. However, when operational-focused CEOs are asked about the future and potential growth, they typically aren’t as confident.
These leaders generally anticipate future growth only via mergers and acquisitions.
In short, operationally focused companies excel at running their business as a machine with repeatable processes. They are wonderful at managing and operating, but they are more focused on growth through the acquisition and improvement in processes and management of another company.
In a market-focused company, the CEO typically comes out of a marketing or IT background. While this might surprise you, keep in mind that the world of technology constantly requires participants to look ahead, to analyze competitors to see what’s happening in the marketplace, and to look where the industry will be five years from now.
Market-focused company leaders look ahead in business.
They excel at predicting trends, but don’t necessarily focus on the day-to-day management of the company.
Market-focused leaders tend to not be too enthusiastic about the state of their business, but they often see a huge amount of opportunity and growth in the future.
A CEO who is focused on the future will have dedicated employees who are researching and analyzing the future of the marketplace, and the company will create growth through new products and service offerings.
The Best of Both Worlds
You might deduce that both types of company leadership are flawed. Operations-focused leadership means the company excels at managing and running operations, but they are often limited when it comes to innovation in the industry.
On the other side of the coin, market-focused leaders are frequently great at seeing the future and working six months out, but they don’t have the capacity to effectively employ the procedures to manage a company day-to-day
The good news is that a company is in no way limited to just one or the other style of management.
When market-focused companies add operational behavior, they get better. However, when operations-focused companies add market behavior, they got exponentially better.
In economic terms, there is a bigger multiplier effect when you take the linear, metric-based culture of an operationally focused company and add the market perspective to it than when you take a market-focused company and add the metrics of operations to it.
When operationally focused companies exhibited the behavior of market-focused companies, they claimed the highest rate of growth, were the most excited about the future, and performed better overall than market-focused companies trying to acquire operational behavior.
The Growth-Driven Leader
There is one type of leader that trumps the operationally focused or market-focused leader. Leaders who are so confident that they are willing to admit mistakes that will provide a company with the greatest amount of growth.
A leader must admit what she doesn’t know and be assertive enough to surround herself with people who have the skills necessary to promote growth and innovation or internal efficiency.
When a leader isn’t confident, she is often hesitant to bring in the necessary support staff or lacks the self-awareness to see she can’t do it all herself.
Little growth will ever come from an organization with this type of leader.
Leadership isn’t just one person’s responsibility. It takes perspective from both sides to build, sustain, and grow a company.
See the research behind this article. It is available for download here
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