How Culture and Leadership Affect Your Business Growth
From: “Help! My Business Is Growing” Podcast
Your business culture is an integral part of the actual running of your business and can spell the difference between your company's success and failure.
The lack of culture and leadership will also inevitably show up in your business finances.
We break down how culture and leadership affect your growing business and what steps you take to avoid the lack of leadership and business culture. My guest is Lindsay White. She is a Leadership Coach, People Strategist, and founder of High Voltage Coaching. Her company coaches and guides female business owners as they navigate their leadership journey.
In this episode, we dive deep into:
02:50 Defining "workplace culture."
06:20 Identifying negative leadership issues that impact culture
10:50 Leadership extremes: Micro-management vs Hands-Off management
18:00 Culture & effective recruitment strategy
29:30 Managing employees who are also family members or friends
36:35 How to figure out your leadership style
Listen to the podcast here:
What is workplace culture & why is it important?
Culture is the way that people interact in your business. It is the behaviors that they demonstrate when they are relating to customers, suppliers, and work colleagues. It is also the behaviors that are a reflection of your organization's mission, values, and vision.
Management needs to provide a framework for culture or describe and articulate it so that everyone can understand and connect to it. This will enable all employees and team members, contractors, and stakeholders to see themselves reflected in your culture.
Take note that culture is not exclusive to big corporations and should also be present in smaller companies. In smaller businesses, every person counts and has an impact on clients, making culture even more significant, as it directly affects your bottom line.
If workplace culture - and leadership is lacking, it could negatively affect your business finances and cause problems such as higher employee turnover, falling productivity levels, customer complaints, and lost contracts.
Identifying leadership issues that impact culture
These are the three most common issues that lack effective leadership causes:
1. Communication issues
Leaders should clearly communicate what they want and what needs to be done. Employees are not mind-readers, so don't drop hints. Be absolutely and unequivocally clear with whatever directions you have. Though it seems like such a basic point, sadly, many miss this and continue to lead without clarity.
2. Avoiding difficult conversations
Some leaders don't want to hurt feelings and would rather avoid directly telling employees how to do things better. What ends up happening is that these same leaders become annoyed or unsatisfied with employees' performance.
It's essential to have hard, yet forward, empathetic, and open conversations with your team. Don't leave them wondering if they are doing a good job or not, or leave them feeling directionless by not giving feedback. Employees will continue to thrive if they feel valued, empowered, and cared for by management.
A lot of business leaders hire the best people but micromanage everything the new hire or team is working on. Micromanaging is extremely disengaging and leaves employees feeling undervalued.
All these issues cause unhappy or demotivated employees, which in turn create unhappy and dissatisfied clients. A drop in the number of customers and high employee turnover will eventually end up affecting your bottom line.
"It is critical to your business to create a space of trust and respect that goes both ways between leaders and employees." - Lindsay White
Leadership extremes: Micromanagement vs Hands-Off management
The two extreme forms of leadership, micromanagement and hands-off management, are both bad for your business.
You are micromanaging if you are way too involved, immersed, and feeling overwhelmed in the minutiae of day-to-day operations at work. This is especially unfortunate if you are in the C-suite already. Micromanaging will prevent you from working on what you need to focus on, namely strategy, planning, and building a culture.
On the other hand, hands-off management is when you are too liberal and let your employees do their own thing. Though this may sound like a great setup - it's not. You'll end up with nervous and anxious employees because they have not been given any clear directions and don't know what they are accountable for or how they slot into the company's structure.
These two leadership extremes end up with the same results: disengaged, disenfranchised, one-foot-out-of-door employees, who have no more innovation, creativity, or passion. They're probably already looking for new roles somewhere else.
It's imperative to find the right balance between micromanagement and hands-off management because demotivated employees will cost you money. They are no longer productive or happy, and your customers will feel it as well.
Culture & effective recruitment strategy
As your business expands, you'll need to bring more people into your organization. Getting your recruitment process right can boost your company’s culture.
Here are 3 suggestions on how to do it well:
1. Prepare well-defined job descriptions that incorporate your business’ vision, mission, and values.
2. Practice what you preach! You won't find the right candidate with the values you want if your culture doesn't reflect those values. Having that clarity of culture will ensure that you will hire the right people instead of someone that looks great on paper but, in the end, is not a good fit.
3. Keep an eye on your onboarding process. Get new hires up to speed as quickly as possible so that they feel a part of the group. The faster they contribute their expertise, the better for your bottom line and morale.
Managing employees who are also family members or friends
Having friends or family members can bring an extra set of complexities. Often, family and friends offered to help when the business was new. You hired them, and it worked out. But now that the business is growing, your best friend or cousin might no longer be a good fit, or their role has evolved.
To effectively handle family members or friends and employees, provide clear expectations and be willing to have difficult conversations despite how uncomfortable or awkward it might feel. Here are some suggestions on how to handle these conversations:
Don't tiptoe around any work or performance issues
You need to be brave and bold when discussing changes in position
Talk about what is working and not working
Try to keep your emotions out of it as much as possible
"Leadership is not about 'me'. It has everything to do with the people who work for me. It is all about being in service to them. That is what it means to be a true leader." - Lindsay White
How do you figure out your leadership style?
Here are some steps to help you figure it out:
1. What are your personal values?
What values are important to you - not as a business owner, entrepreneur, mother, or partner - but as a human being? You need to understand your values and see how you bring them to life in your daily behavior. If you don't know who you are, you won't figure out what kind of leader you are.
2. Define what it means to be a great leader.
Think about who you want to emulate when you see yourself as a leader. What do you think are the most important qualities of outstanding and effective leadership?
3. List down your special superhero powers.
What do you already do well? Can you find ways to bring more of it into your life and in your management style?
Lindsay takes it a step further during her coaching session. Participants create a personal "leadership brand statement" similar to what you would make for your business from these three questions. It fleshes out and articulates: "I do this, and this is the outcome for the people I lead."
Finding your leadership style is a process and, ultimately, a journey of self-discovery and self-awareness. It requires testing what values and behaviors work - and don't work, and personal reflections on great and terrible leadership examples. At the end of this process, you get to decide what kind of leader you want to be. It integrates all the things that you can bring to the table as a person and leader.
"Get honest with your values first. And then take a look at the values you bring to your own business. See if they are even close to being aligned and if they're not, that's where you need to start your work." - Lindsay White
We dissect this topic and more over on the podcast. Listen here:
Your company's culture is a crucial part of its success, and without it, your business finances will be negatively affected. Two things to do:
Define your workplace culture
Check for signs if your business is lacking effective leadership
Business owners must be proactive in fostering a culture in an engaging workplace that encourages creativity and collaboration among workers. How to:
Plan your company's people strategy.
Develop an effective recruitment process with culture in mind.
Developing an effective leadership style is also vital, especially one that motivates employees to do their best work and steers the business to continued financial success and sustainability. How to find your leadership style:
Take the time to go through a process of self-discovery and self-awareness
About Lindsay White:
Lindsay White is a Leadership Coach, People Strategist, and founder of High Voltage Coaching, a company that coaches and guides female business owners as they navigate their leadership journey.
She believes that every business deserves a great leader, an inspiring culture, and a people strategy that brings it all to life. It is her mission to help small business leaders succeed by developing their people and creating engaged workplaces.
Website - https://highvoltagecoa.wpengine.com/
by Kathy Svetina
Kathy is a Fractional CFO and the founder and director of NewCastle Finance LLC. She is a financial puzzle solver, focusing on women-owned businesses, providing financial insights needed for a healthy and sustainable business.