“The function of leadership is to produce more leaders, not more followers.” – Ralph Nader
As a company grows from a raw startup to a successful enterprise, the focus and skills required of leadership must evolve accordingly. Leadership is a skill that can be developed with guidance and practice, but it needs intimate self-knowledge and insight to be successful. Adjusting your management style to your company’s stage is crucial, as what works for a large corporation may not be appropriate for a small startup.
In larger companies, leaders spend time making speeches and communicating with the media, relying on simple and repeated messages. In contrast, leaders in small startups are “hands-on,” showing employees how to get things done and requiring more complex communication to build trust. Personal charisma and specific domain expertise play essential roles in leading small teams effectively.
To explore how leadership evolves with company development, a five-stage model is used: raw startup to a mature company. At all stages, leaders need consistency, leading by example, and empathy to form trust and respect with their team. Employees may not fully understand the decisions and complexities of a CEO’s role, and leaders must empathize with their perspective.
Leadership attributes essential at all times include confidence, knowledge of the business landscape, respect for others, honesty, strong communication skills, and unwavering commitment to the mission. Effective leadership is not just about giving orders but producing more leaders within the organization.
“Good leaders inspire people to have confidence in the leader; great leaders inspire people to have confidence in themselves.” – Eleanor Roosevelt
The first stage of a company’s development is the raw startup. Leaders must be hands-on, providing clear direction and demonstrating domain expertise to build trust and confidence. One-on-one communication is vital in forming a cohesive team. As the company moves to the second stage, growth requires a focus on building systems and processes to handle increased complexity.
In the third stage, success requires a shift from being a doer to an enabler. Leaders must delegate and empower others to take ownership of tasks and decisions. This stage demands a strategic vision for expansion and positioning the company for the long term.
By the fourth stage, the company becomes a mature enterprise, and leaders must adopt a more strategic mindset. They should focus on talent development, succession planning, and guiding the company through changing market dynamics. The fifth stage involves leadership legacy, ensuring a smooth transition of leadership and a lasting impact on the organization.
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Throughout these stages, leadership is not about power but empowering others, fostering a culture of innovation, and building a strong team that can carry the company forward. Leadership is a journey of growth and adaptation, and great leaders inspire confidence in their team, enabling them to reach their full potential.
“The best way to predict the future is to create it.” – Peter Drucker
In conclusion, leadership in emerging growth companies evolves with the company’s stage of development. Different skills and approaches are required at each stage, from hands-on guidance in the startup phase to strategic vision and talent development in the mature stage. Consistency, empathy, and strong communication are essential attributes for effective leadership at all times. A successful leader is not just a person giving orders but one who empowers others, inspires confidence, and creates a culture of innovation and growth. By understanding and adjusting your management style to your company’s stage, you can lead your organization to success and leave a lasting legacy of leadership.
Bob Norton is a long-time Serial Entrepreneur, CEO and investor who founded six companies with four exits that returned over $1 billion to investors for a 25X ROI. Two others are still in development. He has trained, consulted and advised thousands of Entrepreneurs, CEOs and boards since 2002. Mr. Norton works with companies to 2X to 10X growth rates and valuation using AirTight Management™, the world’s most comprehensive Leadership Operating System. He also helps companies raise capital to fund growth. He is also the Founder of The CEO Boot Camp™ and Entrepreneurship University™ for early-stage companies that have not reached product-market fit and $1M ARR.
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