The missing link for business success

January 17, 2013, 3:03 pm Peter Switzer Yahoo7

Success and failure come down to leadership which is why developing strong leaders is crucial to the success of any business.

I have often joked in my small business speeches that the best book I have ever read is “my own!” I then hold up a copy of 350 Ways To Grow Your Business, which always brings a nice laugh.

Of course, there are other great books that anyone in business should read, which include Good to Great by Jim Collins, Losing My Virginity by Richard Branson and Steve Jobs by Walter Isaacson. There are others, but the one that had an enormous impact on me was John Maxwell’s The 21 Irrefutable Laws of Leadership.

Leadership = business growth

Maxwell has sold in excess of a million books on leadership and I actually was his MC in Dubai at a conference a few years ago. That’s where I heard him for the first time and it was there that the penny dropped I had to lift my leadership ability if our business was to grow.

John McGrath, the founder of McGrath Real Estate always argues that a fish rots from the head down and no business will outpace its leader. Jim Collins, in looking at the most successful US companies over a 20-year period using over 30 post-graduate students to drill through the data, identified leadership of these companies as critical to the operation’s success.

The key to success

However, when I wrote my 350 Ways to Grow Your Business, which was based on 78 very successful Aussie businesses from Gloria Jeans to Sumo Salad to BridgeClimb to Boost Juice and a whole lot more, all of the founders held back on what I think was the main reason for their success!

You see, the 350 ways were often based on what the founder or CEO or MD would underline as the reasons for the businesses’ success. I also interpreted what they did, which singled them out from others, to get the 350 number but not one of these legends of business ever answered my “why did you succeed?” question with “my leadership!”

But they should have, because this is the critical reason for most great businesses. The longer I have run my own business with my family, the more it has become clear that success and failure get down to leadership.

Get outside the comfort zone

Maxwell doesn’t believe leaders are born, in general, but they can be developed and he argues, I think convincingly, that “no matter where you are in the leadership process, know this: the greater number of laws you learn, the better leader you will become”.

Of course, it’s not just learning but actually doing leadership, which means challenging yourself to get outside your comfort zone. Leadership feeds off change and this leads to growth and not just of the business but you as a leader and invariably you as a person.

Plan for growth

Another point Maxwell makes is that leaders are always learners who strive for better business as well as individual performance and productivity all of the time. It’s a 24/7 commitment linked to a clear dream of what the entrepreneur wants to achieve.

Maxwell says he was asked a question by his mentor many years ago, which really shocked him and told him that his approach had to change.

The question was, “what is your plan for personal growth?” He had to admit that he didn’t have a formal, written down plan for personal growth and that was the last day that ever happened in his life.

Of course, I don’t think many successful entrepreneurs have ever done this — written out a plan for personal growth — but they do tend to be so fanatical that they are always up for change, they are always willing to invest in innovations that could deliver better outcomes, and they are totally driven for success.

No fear

I have a theory that the most successful entrepreneurs are the ones who continually push themselves into discomfort zones and they do it because success is more important than self-protection and fear of failure.

When I recently reread my own book, I saw the subjects — great Aussie entrepreneurs — I have interviewed, talked about, analyzed and deconstructed to see what explained their success in a totally new light.

Their journey was not just one of navigating a business from a start-up to a huge franchise operation such as Gloria Jeans or an iconic brand such as BridgeClimb, but it was one about the growth of a leader.

This not only explains the business success in terms of profits, the number of employees or its value, but also what it did for the people who worked for these leaders, as great leaders create great leaders.

It’s no surprise that Aussie Home Loans founder, John Symond, saw many of his staff go on to create other great businesses in the mortgage space.

Maxwell’s 5 levels of leadership

Maxwell, in his latest book The 5 Levels of Leadership, says at the first level people follow you because you pay them while at the second level they like you — it’s a relationship thing. The quality of the leadership lifts at the third level as they follow you because of what you’ve achieved, but at the fourth higher level they want to work with you for what you have done for them. Finally at the fifth level, you have all four levels of leadership working for you, your business is performing brilliantly and you are a legend not only to your devoted customers, but also for the people who follow you.

At numerous award nights I have seen great business builders instantly thank their staff for the success, but these people don’t happen along by chance.

Like leaders, they are created by leaders, and this is the holy grail that all business owners or entrepreneurs have to keep searching for.

Peter Switzer is the founder of the Switzer Super Report, a newsletter and website for self-managed super funds.

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