“Unique Leadership Context? Wha you coming wid now?
That was the response I got when I asked my group of small business leaders if they knew their unique leadership context.
As I explained to them, business leadership does not happen in a vacuum. Each leader has his or her own unique mix of operational challenges and complex people to lead. The problem is, we tend to focus primarily on the "people aspect" of leadership and in so doing, continue to create a lopsided context of leadership.
And when you’re leading a small business, you cannot separate that business from the unique set of circumstances that impacts it, and hope to be successful just by focusing on your team.
You need to continuously find the necessary and most effective leadership actions to take, within your special set of circumstances, to lead your people in such a way that your business is consistently making you the money you want.
It’s your make or break challenge, really.
The big question is: How do you determine your unique leadership context?
I can help with that and I’m happy to do so.
First, I’ll explain "leadership context" and why it matters to you.
Then, I’ll borrow 10 questions from my Rapid Scale Leadership Programme which you can use as a start to understanding the context in which you have to lead.
And finally, I’ll show you how to use this understanding as the path to finding your money sweet spot.
If you're ready, let's unpack this together...
What is “leadership context”?
For the most part, when we talk about business leadership and when we practice it, the picture is about the organisational chart.
You know, the perennial concept of a person, or group of persons, at the head of a business or an organization with a number of layers of followers below them.
In this scenario, you are focused almost exclusively on the people and culture, or the soft issues of leadership.
While this is okay, it is not enough, especially if you want to scale your revenue fast.
We can now agree that while this approach to leadership is practiced in isolation, in reality, leadership does not happen in a vacuum. Every business is impacted by hard, technical and or market issues, and as a leader, it is really a serious mistake for you to ignore these.
So, for your small business, your leadership context can usually be divided in two parts:
The external market/industry/niche part impacting all small businesses; and
The internal part that is unique and special to your business.
For example, let’s look at a sample of external issues all small business are likely to face:
- Rapidly changing business environment
- Increases in complexity and risks
- Diverse workforces
- Need to develop leaders at all levels
- Economic/social uncertainty (COVID-19)
- Growth and productivity pressures
- Continuing need to innovate
Your leadership context then, is how you interpret these issues and leverage your internal circumstances to scale your business fast. To be sure you understand, I want to emphasise that your leadership context is specific to your business and as such, it is different for every business.
Why does "leadership context" matter?
In order to answer this question, let's first answer the question "why does LEADERSHIP matter?"
Very briefly, as a small business, you want to scale your business as opposed to growing it.
When you scale your business, you increase your revenue without putting out large sums of money or other resources, to generate that increased income.
For example, if you wanted to add another 50 customers, you would do it by using existing resources instead of adding more staff or finding a bigger place.
As a small business owner, with limited resources, I find that keen, practical and innovative leadership is one of the best ways to scale your business.
And discovering your own leadership context is the first step in applying leadership skills to rapidly scale your business.
This is not something you just skirt around. This is something you need to know.
Furthermore, in the process of discovering your own leadership context, you:
- Improve your decision-making
- Deepen your understanding of your market/niche
- Increase market share and by extension, revenue
- Gain a better understanding of your business risks
- Become a more effective leader
- Improve your personal and professional development
- Rapidly scale your business
How to establish your unique leadership context
In my Rapid Scale Leadership Programme, participants answer a number of important questions to help them nail down their unique leadership context.
I’ve selected 10 of them for you, which I believe will be key to getting you started. Answer them as best you can, paying special attention to the ones you struggle to answer.
So open a blank page in word or use good, old pen and paper and begin. Try to follow the order but if you have difficulty with any, move to the next and then return:
1. What is your mission?
This is the reason you set up your business and should not be confused with your vision. Being clear about your mission is the best place to start when you analyse the context in which your business operates.
If you don’t yet have a mission statement, if you want to, now is a good time to go through the process of writing one.
2. What is your business model?
If we state this simply, it’s a plan that indicates how you make money with your business. Please don’t confuse it with your mission, which is what you set up your business to do. It’s more of an actual representation of how your business operates and it also tells the financial story of your business.
Because it helps you to tell the financial story of your business, It is invaluable as a tool for investors to decide if to risk investing in your business or not. It also makes it easy for business flexibility.
3. Can you describe your business culture and is it working for you?
If you can’t describe your business culture, you are in good company, not that you should take comfort in that. The problem is, most small business owners have a sense of the definition of “culture” but describing their own, is another story.
You must also honesty answer if it’s working for you. Why? Your culture might have unconsciously evolved by your hiring, your behaviour, your values and what you have tolerated. And now, even though you are not willing to admit it openly, it’s not working for you.
But leadership and culture are deeply intertwined, so you must address them together. And you must also address them, even if you have no employees at the moment.
4. How many employees do you have and are you making the best use of their skills?
Of course you know how many employees you have, so just write the number down. But are you clear about what skills they have? And even more importantly, are you making the best use of those skills?
Let me show you what I mean. It is common for you to hire a person with the skills to match a specific job you want done. No problem there. But often, that person might have skills you could well use in your wider business, and you miss out on them because of how you hire.
That's why this questions matters.
5. What’s the state of your market and your niche in that market?
This is the first of the “hard” leadership questions I’m asking you to answer. It really matters to understanding your specific leadership context and using it to scale your revenue.
I trust by now you have carved out a specific niche in your market, understanding that you can’t be everything to everyone.
This question is necessary because when you’ve been in a particular market/niche for a while, you become complacent. You are slow to realise that the market has changed on you, and you need new solutions to maintain your market share.
6. Who are your customers? (describe the top 3 groups)
Depending on your business, there are several ways you can group your customers – by spend, demographics, location, product, gender, behaviour - the ways are endless.
Grouping customers is critical for marketing. Moreover, when you link these to purchases or other KPIs (key performance indicators) you can nurture your customers at different stages of the buying funnel.
How you do this effectively, is a determined by how you harness and use your internal resources.
7. What signs have you noticed that your products/services are LOSING market share and what are you doing about it?
This question is about another one of the “hard” issues which impacts your leadership context.
It assumes that you have a pre-determined share of the market that you want to maintain. You also need to be clear that you’re actually losing market share and that the market itself is not contracting.
In this way, once you become clear that you are losing market share, you will be better able to come up with a variety of ways to address the loss.
8. What signs have you noticed that your products/services are GAINING market share and what role are you playing in this?
There are several desirable benefits of gaining market share. They include economies of scale, improved reputation, increased influence, more bargaining power and of course revenue growth.
But when you see signs that you are gaining market share and you have not deliberately planned it, you must quickly step in. Why?
You should be the one leading the expansion of your business. If you’re not, it could grow out of your control. The more of the market you acquire, the greater the risks for the size of your business.
9. How do you define a competitor and can you list your top 3 – 5 competitors? Including their strategies, strengths and weaknesses?
A competitor is not only someone who has a business similar to yours in your niche. A true competitor is constantly seeking to steal your customers and revenue, as well as outdo your reputation, influence and market standing.
Therefore, it is important to identify them and get to know them. In answering this question, I suggest that you put this in a simple table form so you can do a comparison. To make it more meaningful, include your business as well.
In addition, as it relates to your leadership context and competition, there is some key information you should know. For example, you should keep track of the key factors driving:
- your customer buying decisions
- employee satisfaction
- profit margins
- service quality
10. What are the 3 – 5 most significant market trends/issues which you think are going to re-shape your market in the next 3 years?
This goes beyond just having a vision. It requires you to read the tea leaves spot the trends and pivot and redirect your resources to reposition your business.
Bear in mind, these trends may be economic, legislative, political, technological or social. You must understand each of them, as this helps to set the context for your vision and the journey towards it.
Here’s an example you can relate to. COVID-19 came apparently out of nowhere and it has changed our lives and the way we do business forever.
How to use your leadership context to scale your revenue
Now that you have answered these questions, a significant "scale opportunity" awaits you.
What you have to do now, is use the answers to the questions to create the bridge to get you from where you are to where you money sweet spot awaits you.
In my experience, the following steps work very well. You can start with them and if necessary, refine the process until it's absolutely yours.
1. Be very clear on your mission.
Answering question #1 should have done this for you. Hopefully, if you did not have a mission statement, you would have written one.
2. Do a really deep dive into your market
Yeah...the current state of your market/niche and your standing within that market, matters.
When you answered questions #5, 7, 8 and 10, you should have acquired a comprehensive understanding of your market and your niche within that market. You also learnt whether you're losing or gaining market share and the trends likely to impact you in the next 3 - 5 years.
This is a key aspect of the hard issues in your leadership context as well as the greatest impact on how you increase your revenue. So now is the time to improve on any weak answers and close any gaps.
3. Know your customers and your competition
This can be seen as an extension of #2 above with special emphasis on the "people" aspect and you would have covered this in questions #6 and #9.
4. Decide on the culture you want in your business
You addressed this when you answered question #3. If you're happy with your existing culture and it's working for you, move on to the next step.
5. Nail down your business model
In this step, you place your business model in the spotlight. When you are really clear on how you make money with your business, then you are in a better position to make even more money.
Hopefully, you got it right when you answered question # 2.
6. Bring everything together in your own revenue-scaling plan
By now you have soundly established the context in which you lead.
What you will do now is come up with your own distinctive plan to scale your revenue. One that takes advantage of your unique leadership circumstances and helps you find your money sweet spot.
This is when you decide how you will actually lead your team to take advantage of you circumstances to help you rapidly scale your revenue. You need to be familiar with their skills and make the best use of them individually and collectively. Be sure to rely heavily on your answer to question #4.
To make this a success, you now have to lead, and NOT like you did before. With you new understanding, old approaches will not work.
Let me tell you, if you've not done it before, now is a good time to review your own business leadership skills. This is especially important if you don't yet have a team.
You see, the answers to the questions create the bridge from where your revenue is at the moment, to where it's constantly increasing. But how you lead in the moment, determines how you cross that bridge.
So go on...give it your very best shot!
Your next "leadership context" steps
So there you have it!
I have laid out a fairly comprehensive plan showing you how to use your unique leadership context to begin scaling your revenue.
If you implement it, you will begin to see results fast.
But while it is an important step, you need much more than that. You need to refine and streamline your leadership approach so that you lead your business to consistent, scalable revenue.
For that you need my Rapid Scale Leadership Programme.
In addition to your leadership context, it shows you how to lead yourself and your team. It also teaches you how to implement a mentorship programme that's just right for your business and helps you increase you and your team's productivity.
If this is for you, contact me with "Rapid Scale Leadership" in the subject line, and we can go from there.
To the sweet spot in your leadership context...
Now you know how to establish your leadership context...
If you want to learn how to make money in a crisis...yeah even in a crisis like COVID-19, then you'll love these 6 key strategies for making money in a crisis. Download them now!