How the best leaders drive high performance and growth
Very few CEOs know how to lead their companies up the growth curve. Many fear that trying to grow bigger means risking what they have achieved, so they ‘hunker down’ and try to protect what they have. But in business, like sports, you don’t win a game by playing defence. And the good news is that there’s an art and a science to growth that can be explained, learned, and executed—with positive results.
MISSION, VALUES, AND VISION
Successful growth CEOs are able to communicate the company’s mission, vision, and values, translate strategy into specific actions, make decisions, and then communicate priorities and progress.
When employees share the company’s values, grasp the company’s mission and vision, and understand how their performance impacts the company’s performance, companies will grow.
Management consultant Peter Drucker asked five key questions of every CEO he worked with:
- Who are you—that is, what are your company’s mission, values, and vision?
- Who are your customers?
- What do they value?
- How are you measuring that you are delivering value?
- What’s the plan to deliver more value to more customers?
CEOs must recognise where their company is on the growth curve. Companies that are in the start-up growth stage need to focus on developing their product or service and building relationships with potential customers and employees. Companies that are in the initial growth phase need to focus on generating revenue and launching differentiated products that capture market share.
The role of the CEO changes at every stage of growth. In the beginning, the CEO does much of the product development, sales, and administration and makes all the decisions. However, once the product or market fit is established, they need to begin setting the direction of the company, hiring people who are high performers and who fit the values of the company, then learn to delegate to them. Rapid growth provides a different set of challenges and requires the CEO to play a different set of roles—that is, team-builder, coach, planner, and communicator.
CEOs of high-growth companies have an unrelenting focus on customers’ needs and the ability to define who their customers are. Technology entrepreneur and CEO of Amazon Jeff Bezos has an empty chair at the table to remind everyone that the most important person not at the meeting is Amazon’s customer.
CEOs need to watch competitors and ask, “In what ways are they serving our customers better than we are?” In the same vein, they need to ask, “How are we tracking customers’ emerging needs, and what new products or services can we develop to meet those needs?” CEOs of high-growth companies keep everyone focused externally—and minimise internal politics. They know that success is about winning battles in the marketplace, not winning battles over internal resources.
CEOs need to be continually asking themselves, “Do we have the right people in the right seats on our bus?” You need people who are quick learners, can teach others what they have just learned, are team players, and can solve problems, not just identify them. Finding people who are motivated—then not de-motivating them—is critically important in a growth company.
CEOs need to insist on diversity if for no other reason than diverse teams produce better results. Teams with people from diverse backgrounds are better at innovating, and teams that reflect the diversity of their customer base develop products that are more appealing to their customers. Companies whose boards include women are more profitable. The data is unequivocal. So make the choices that lead to growth.
High-growth companies regularly assess employees’ performance on fit with values as well as functional performance. Skipping evaluations means missing opportunities to identify, reward, and promote great performers, as well as to identify low performers who need to move on. Failing to recognise high performance or to address low performance will often result in high performers becoming discouraged and moving on—just the opposite of what you want if you are trying to grow.
High-growth companies regularly assess employees’ performance on fit with values as well as functional performance.
STRATEGIC FORESIGHT AND EXECUTION
A high-growth CEO needs to strike the right balance between strategy development and execution. You need to pick a strategy and then develop your organisation to support your strategy. For example, if your strategy is to be the lowest-cost provider, then you need to be good at sourcing products, supply-chain management, and automation. If, on the other hand, you want to charge premium prices for your products or services, then brand strength and a personalised buying experience coupled with amazing customer service are paramount. Picking the right strategy and aligning the company to it, is an essential element of growth.
There are many tactics that leaders can use to grow, including product expansion, market expansion, different positioning, pricing, and better marketing or sales skills. Each year, the CEO should identify one or two tactics that are most appropriate, then develop goals and action plans and assign responsibility and accountability to individuals for achieving specific results.
Clear communication and alignment of all staff is essential to ensure that everyone understands the strategic direction of the company and their specific tasks and activities.
Successful CEOs are not timid. They take bold risks—on people, markets, and on ideas. They have a healthy paranoia. They challenge assumptions and never get too comfortable with the status quo. When things don’t work, they challenge their team to figure out why. Leaders ‘lean in’ and navigate through uncertainty. They encourage exploration. They use their networks to help ‘de-risk’ ideas. They continually challenge themselves and others to ‘imagine a better way’.
In summary, high-growth CEOs are obsessed with achieving their company’s vision, meeting customers’ needs, and selecting and retaining those high performers who share the company’s values. They balance strategy, tactics, and execution. They watch the edges for pending changes and the ‘white spaces’ for opportunities.
Dr Jana Matthews
Article and Artwork as featured in The CEO Magazine