Guide: Influence of the Leader(s)

There is no person more important in determining a business’ success, or struggles, than the person in that head leadership position. In almost all small businesses this will be the owner(s).

A business’ purpose must be aligned to that of the business leader(s), and the owner heavily influences all aspects of culture (atmosphere, productivity, creativity), discipline, awareness, openness, empowerment, strong management, inspiration, and translation of the purpose into reality. However, there are several other crucial business leader elements, all of which are measured in some capacity within the Business Assessment Rating tool in the review section.

Let’s start with three key ones:
  • Leader ambition
    • Other terms: aspiration, dream, wish, intent.
  • Leader ability
    • Other terms: skills, experience, intelligence.
  • Leader action
    • Other terms: drive, desire, determination, hunger, work ethic, motivation.

Leader Ambition

We start with ambition since that is what both ability and action will be measured against.

Ambition comes in many forms and levels. It can measured in financial or non-financial terms. It can be small, like loving your work, or it can be very large, like Elon Musk (founder of PayPal, Tesla, and SpaceX), who wants to build a space station and retire on Mars.

To help you work out your level of ambition we have created the Dsrupt Ambition Scales. Don’t get too hung up on the exact figures or words; what’s more important is to realise that there is a continuum of financial and non-financial ambition and it’s vital that you work out where you a) are and b) want to be.

Things that can restrict ambition in life include:

Life stage

It can be easier to be ambitious when we are younger and more energetic, and without a partner, children, mortgage or large salary to sacrifice. However, age comes with many experience benefits, and there are numerous examples of successful entrepreneurs who didn’t get very ambitious until later in life. Michael Hill didn’t start his business until his forties, Ray Croc didn’t join McDonald’s until he was 52, and Colonel Sanders didn’t start Kentucky Fried Chicken until he was 66!

Reality of hard work

Relates to action as well. The reality for startups and small businesses is that only 2% in New Zealand get beyond $5 million turnover. To get to $5 million, many owners have to push hard for 5 years. This means long hours, some sacrifices, and that likelihood puts many off. Creating great businesses is not easy and not for everyone.

The social norms in your peer group

If you’re surrounded by friends and family who say it isn’t possible, then you’ll probably aspire to those same standards. If you’re not happy with this, then it’s probably time to rethink your social circles, and start to see more people who see the world differently.

The size of the market you’re playing in

You can never make $3 million in a $300,000 niche industry. Purpose needs to be aligned with Demand.

Tolerance for risk

Being afraid of the risks holds a lot of people back from dreaming big. Often though, the bigger risk is to do nothing. By following the right steps, you can also radically reduce the risk of a big ambition.

Doubt in your ability

We cover this next – most of us put limits on ourselves unnecessarily.

“You are the average of the five people you spend the most time with”

Leader Ability

As just mentioned, we often have more ability than we give ourselves credit for. The missing gap is usually confidence. If you are confident, your dominating thoughts will be positive and centre around why you can do this. If you’re not, then your dominating thoughts will be negative and revolve around what’s stopping you.

None of us know everything of course, so for anything you don’t have the ability to do, then you either need to:

• Gain that ability yourself.
• Gain that ability through others.
• Decrease your ambition.

For any of us to confront our own ability level takes a great deal of self-awareness, honesty and humility which is very hard whether you’re an employee or a business leader. The difference is that when an employee doesn’t have the ability, the solutions are pretty straight forward. However, when a business leader is the one that is holding a business back, it takes a very smart and brave person to a) realise this and b) do something about it.

We decided not to specifically measure owner/leader ability within the BAR; however, the scores for each measure, and the overall score, will reflect how good a job they are doing. Good business owners/ leaders create good businesses.

Leader Action

If the ambition and ability are present then you’re two- thirds of the way there, right? Wrong. Plenty of people have plenty of ambition, and some of those people have plenty of ability, but very few ever make anything big happen.

Turning ideas into action is the final step of this phase.