How to progress from a business owner to a leader

Deborah Done, director at employment law consultancy Peninsula, discusses how to make the transition from one-man band to successfully overseeing a team.

A major challenge faced by small business owners as their companies grow and as they begin to employ more staff is how to make the transition from being a one-man band or from working as a small operation of close allies to becoming a leader of several or even many people.

It goes without saying that if you’ve had the courage to set up on your own, you must either have had a certain amount of self-belief, have developed an idea that you felt would sell, or have possessed a combination of both. But being entrepreneurial does not necessarily equate to being a good leader, which is essential if you really want to develop and grow your business where everyone is working toward a shared vision and goal.

The late Peter Drucker, a business consultant, an educator and a prolific author on management education, was a great hero of mine. He once said, ‘Management is doing things right: leadership is doing the right things’. What might he have meant by that?

To my mind, he means that management involves, to some extent, doing things extremely well but by the book, demonstrating technical excellence, being supremely professional, ticking all the right boxes. But being a leader, he seems to be suggesting, is a far broader, tougher, more nebulous and trickier role. He implies it involves a level of creativity and judgement, which you can’t necessarily get from reading a book or by going on a course. It seems far more instinctive than simply ‘managing’. And it won’t always make you popular – doing the right thing is, of course, not always the easiest option.

So what differentiates a ‘leader’ from a ‘manager’ and how can you as a small business owner begin to develop those qualities? Here are seven points to think about when making the transition from running and managing your business to leading a team of people.

1. A leader is strategic. As you begin to build a strong team around you, you need to develop confidence and trust in the team you lead to allow you to look at the bigger picture. You need to be asking and answering strategic questions about your company and your vision. What is the overall direction for the business? What are your quarterly, annual and five year objectives? How will you get there? How are your teams putting this into practice? Do they understand your goals and vision? What are their goals and targets to achieve this strategy?

2. A leader has the confidence to delegate but the strength to keep control. This links into the first point. Unless you learn to trust those around you, you’ll never be able to grow the business beyond a certain point. This does not, however, mean relinquishing control. The important thing is to set clear objectives and targets to ensure your team know what they are supposed to be achieving, how they are meant to achieve it and by when. By checking in regularly on these performance indicators, you can maintain control whilst giving your team the autonomy to get on with their jobs independently. You can quickly spot when an individual or team are diverging from their goals and jump in to bring them back on track.  

3. A leader develops relationships. Communication is a key quality in a leader. Nurturing your people, recognising their achievements, developing their skills all comes through knowing your staff. Building your client base and understanding their changing needs also comes from developing, maintaining and strengthening your relationships.

4. A leader should inspire. In this regard, we can look to the great leaders in, for example, the military. ‘A leader is a person you will follow to a place you wouldn’t go yourself,’ said Joel Baker. You need to inspire your staff by setting an example and by pushing them, the business and of course yourself beyond your comfort zones. You need not only to believe in your business yourself and to regularly communicate your vision and your vision, but you need to be sure those around you understand it and are working with you to achieve it.

5. A leader knows his or her strengths and plays to them. A good business leader recognises that they can’t be all things to all people. Some are better at strategy, some at communication, some at finance, others at sales and marketing. A great leader plays to their strengths and has the self-confidence to bring in excellent people to support them in the areas where they are less strong.

6. A leader is flexible and opportunistic. A strategy is all well and good. But if an opportunity is staring you in the face, even if it may not have formed part of your five year plan, then a real leader wouldn’t rule it out without careful consideration. It’s vital to stand strong on the things that truly matter such as the company’s values and culture, but also to be flexible enough to realise either when an opportunity is too good to miss or to change direction if something is not working out as anticipated.

7. A leader keeps learning. It’s very easy when your business is growing to focus on what’s right in front of you instead of lifting your eyes to see what’s going on out there in the real world. But it’s vital to keep reading, looking, listening and learning to spot trends, to make connections and to stay ahead of the game. So read magazines from other sectors to see what they’re up to; keep on top of the business press; go on courses that can help you develop your skill set; and don’t ever get complacent.

Remember that being in a position where you can lead others is a huge privilege. As a business owner, you have a level of responsibility for your employees’ professional self-esteem and ongoing development. Your vision has provided them with a good reason to get out of bed in the morning, ideally to earn a living in a place where they enjoy working, where they understand what they are working towards and where they buy into the objectives. It’s probably worth trying to do it well.

Further reading on leadership

Alan Dobie

Alan Dobie

Alan was assistant editor at Vitesse Media Plc (previous owner of before moving on to a content producer role at Reed Business Information. He has over 17 years of experience in the...

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