Are you building a leadership team?


If you’re actively growing your business, it’s never too soon to start thinking about your leadership team.

Successfully scaling a business isn’t quite rocket science, but there are quite a few moving parts that you have to get right in order to make it all work.

For starters, let’s assume you have a product or service that’s in demand and can be delivered for at least a reasonable profit.  *Note – if there’s any question on this first part, nothing else really matters… thanks for playing.

Assuming you’ve got the basics, you’ll still need a few things if you really want to scale your business successfully. You’ll need systems and processes – without them, you’ll spend way too much time handling the basic stuff (over and over) and you won’t have any opportunities for continuous improvement.  You’ll also need to understand what drives your business. A handful of key performance metrics that are fairly easy to collect and can quickly tell you how the business is doing and forecast what the next month or two will look like.

You’ll need the right people on your team.  The right people are the ones who share your core values (so you’ll also need to understand your core values…). The right people want to be on the team and they want to make things happen. Without the right people, you will ALWAYS find yourself struggling to get things done – every day will be an exhausting uphill battle.  *Note – this is the biggest reason why a business doesn’t make it in the long run.

Finally, you also MUST have a leadership team. Depending on the size and maturity of your business, that could be as small as 1 or 2 key employees who ‘own’ significant parts of the business (i.e. operations, sales, marketing, back-office) or it could be a full-fledged executive team (C-Suite officers).  It’s a simple concept, but this is the one that trips up a lot of business owners.


What’s so important about a Leadership Team?

Do you know a business owner who works really long hours… all the time?  More than likely they can’t remember the last time they took a vacation and pretty much every significant issue that comes up in the business is handled by them.

That’s a business owner without a real leadership team.  They may have employees or even have people who are supposed to be responsible for certain areas of the business, but they do not have a leadership team.

Here’s another way to explain this – courtesy of my friend Jon Denney, who put together a great graphic that really illustrates the difference between most small businesses and those with a leadership team (he calls it an executive team).

The picture on the left represents a majority of small businesses – the owner can balance everything, but it’s a tough job and there’s absolutely no room for error and no time to rest.  Contrast that with the idea of an executive team (that the owner leads) and suddenly your company has a stable foundation. As the owner, you don’t deal with every issue and you’ve got plenty of coverage so you don’t have to be ‘on’ all the time. (You can take a long vacation and actually enjoy it…).

It’s pretty obvious, but as your business gets larger, this issue of balance gets worse. For every business, there is a hard ceiling of how large it can grow without a leadership team. That ceiling varies based on industry and how much energy or capabilities a particular owner might have, but it’s still a hard ceiling that will stop growth and eventually bring a business down.

The other reason why this is critical is that it drives substantial value to the business should you ever want to sell.  A business without a leadership team is more like a job to the potential buyer, whereas one with a leadership team is a valuable asset that can run without the current owner.


What’s it take to build a leadership team?

There are really 4 things you need to have in order to build a leadership team that will help you scale.

1. Profitability – you have to be making enough money so that you can afford the additional overhead of someone in a leadership position. This will enable growth, which means it will be easier to afford over time, but you still need money sloshing around to make the hire.

2. The right people – even more than your employees, someone on your leadership team has to buy into your core values and the overall mission of the business.

3. The right position – whoever you bring on as a leader needs a clear scope of accountability and ownership that’s a big enough chunk to really impact your time as the owner.

4. You have to let go… – this one seems obvious, but it’s where a lot of owners get stuck. When you make the right hire, you have to get out of their way and let them do the job. Which includes letting them make mistakes (and cleaning them up).  They must be able to truly ‘own’ their part of the business and they can’t do that if you’re constantly stepping in to make the big decisions.


What do you think?  Do you have a leadership team in your business that you can count on to help you scale?  Are you doing too much of the work yourself?  Are any significant decisions being made without you?  We’d love to hear your thoughts – leave us a comment.

Shawn Kinkade   Kansas City Business Coach