Driving profitable growth is at the top of every leader’s priority list. Yet, according to Bain and Company, only 10% succeed in achieving sustainable profitable growth.

While growth is the life-blood of every business, at some point, your company will experience the double edge sword of growth.

Either your company will grow faster than your internal capacity to handle it. Chaos, breakdowns and burnout are the result.

OR

Your company hits a wall and growth flattens. As a result, panic often sets in and leaders make rash decisions – either prolonging the stall or causing the company to spiral downward.

Unfortunately, there are no alarms to warn you of either impending challenge. Growth does not follow a linear path. It can be unpredictable and erratic. Growth walls often catch leaders by surprise.

Some companies don’t survive growth walls. They either go out of business or stay in “no man’s land.”

The focus of this article is to address the latter issue – ie., growth walls. While many leaders see growth walls as a revenues issue. The truth is that flat numbers are the byproduct — not the cause — of stalled growth.

The good news is that there are predictable pitfalls and signals that leaders need to heed to scale their companies. This article focuses on 7 of those growth pitfalls.

 7 Pitfalls That Stall Your Company Growth

1. Running After Growth in all the Wrong Places

Initially, growth is critical for survival. However, as your company scales, not all growth is healthy or good.

How, as a leader, do you distinguish between good and bad growth? Healthy vs. unhealthy growth? 

What % of your new business is coming from your core competencies? What % requires capabilities beyond your core?

Do all your new revenues provide healthy margins? If not, is it a market issue, a competitive issue, a behavioral issue or something else preventing you?

According to Bain, companies leave significant money on table because they are not fully leveraging their core.

Tim Cook (Apple’s CEO) says it best …”At Apple we say ‘no’ to great ideas every day in order to do one or two things very well.”

How much of your new growth focuses on what you do best?

2. Success Blind Spots 

Companies that hit a wall have experienced past successful growth.  They are meeting or exceeding revenue goals. Their leaders and employees are proud and rightfully so.

However, success often creates cognitive or psychological leadership blind spots.  Below are 2 examples how.

• Blind Optimism

You make unconscious assumptions that company growth will continue on the same trajectory if you keep on the path you have been. However, markets change and so must your path to future growth.

• Over-Confidence

Past success can exaggerate your ability to control events. And you over-estimate your company’s capabilities.

When over-confident, leaders tend to take on risky opportunities, not ask for help and believe they can handle it all.

Whose unbiased perspective can you access to right-size your decisions and perceptions?

3. Crashing into the Leadership Glass Ceiling

In my extensive experience with growth companies, the number one reason why companies hit the wall is because their leadership team has hit a wall.

Organically grown leaders don’t know what they need to know to get to the next level. As a result, they keep on doing what they have always done – only working harder — expecting a different result. Yes … that’s called insanity :))!

As a company scales, leadership roles also scale and change dramatically at each growth level. To avoid the leadership ceiling, CEOs must ask themselves —

Are you willing to make a major investment in growing your leadership team to the next level?

Does it serve the greater good of your company to be loyal to long time leaders whose roles have outgrown their capabilities and capacities? 

Is it time to hire outside seasoned passionate leaders who have been there and can help you grow?

Both options – ie., cultivating your leaders from within or hiring from the outside – have their upsides and downsides.

If your leadership team has hit a ceiling, get outside help in evaluating the options. Doing nothing will keep your company stuck at the wall.

4. External Oblivion

As a company scales, significant focus is spent on building internal infrastructure. As a result, leaders lose sight of changes in their external environment.

A once fringe competitor may now emerge as a looming threat to your company. Your customers’ needs may have changed without you realizing it.   New disruptive technologies may displace your products/services as alternative solutions to your markets.

Successful growth leaders who break through the wall anticipate the unexpected and turn the unexpected into the profitable.

Are you overly focused on internal superiority that you are missing the cues of external changes?

How are you proactively anticipating and responding to external changes?

5. Hiring for current skills, not long term capabilities

As a company grows, the tendency is to hire employees with current needed skills by your organization.   When small, hiring for the short term is necessary as your resource needs are not always clear.

Once a company hits the $10 – $20 million milestone, hiring people with capabilities to grow your company in next 2 – 3 years is crucial.

What capabilities do you need to hire today to achieve your desired growth for next 3 years?

6. Culture Meltdown

When a company has less than 20 employees, rarely is culture a dominant issue. As the company scales in size, structure and complexity, culture becomes the heart and soul of its growth success.

What causes a culture meltdown as a company scales?

It’s not one thing. It’s multitude of factors that amplify with scale, such as …

• Not Scaling Culture

Some leaders will argue that company culture cannot scale. I both agree and disagree :)).

Your company culture cannot scale if you perceive culture as fixed, unchangeable and static. However, the culture your company needs at $20 million will be different than the culture you need at $50 – $100 million

As you add new people to your organization, as well as your markets evolve, so must your culture evolve.

How are you adapting your culture to the changing needs of your organization and those of your customers?

• Core Values Without Success Measures

While your company’s culture may seem intangible and elusive at times, you can make the intangible tangible and measurable.

The key is to define an abstract value into an operational, measurable success outcome.

I have one client with a core value of excellent customer service. Their measure of success is a customer excellence rating of 25:1. For every 25 customers that rate their service as excellent, only 1 or less customers will rate it as non-excellent.

How do you measure success for each value?

• Healthy Values Gone Bad

Every positive value also has a dark, unhealthy side. However, most leaders are not aware when their values have crossed that line.

A value of excellence, in the extreme, can become perfectionism. Acceptance, at its extreme, can become (unhealthy) tolerance. Customer service, to the extreme, can cost you significant profits.

It’s good to set the bar high. At the other end, know when your values become your Achilles heel, especially as you scale.

7. Mediocrity Sets In

The final danger as companies scale is backsliding into complacency or mediocrity.

Success is a lousy teacher. Complacency often sets in as your company loses its drive and hunger. Nothing will kill growth faster than losing your sense of urgency.

High growth companies should celebrate success. If your company has hit a wall, however, it’s time to take stock.

Has your success morphed into over-comfort and contentment? 

If it has, it’s time to raise your bar, set new sights and refuel your organization’s fire.   Commit to scaling not only in size. Commit also to scaling big WHY and purpose.

Getting Back on the Growth Track: Initial Steps

• Educate yourself about your company’s growth life cycle and the common pitfalls at different growth stages.

• Get your leaders out of day to day operations.

By the time you hit $15 – $20 million in revenues, your leaders should spend about 80% time leading – building teams, delegating, creating strong culture, focusing on long term goals/projects, etc. – and only 20% on daily operations.

To prepare for the transition, ask yourself:

Do your leaders know how to think strategically?

Are their brains wired for big picture, future-orientation, goals/results thinking?

Do they have strong delegation skills to get out of the weeds?

Remember … not all leaders will be able to make the leap to the next level.

• Invest in infrastructure and systems that provide built-in capacity for growth.

• Get outside perspectives

An advisory board or board of directors … visits to “friendly” competitors to see how they do things … hiring a consultant with experience in growth companies. These are all ways to get beyond your blind spots and tap into expertise that may be missing in your organization.

• Invest in scaling your company culture

Continuously communicate your company’s vision and purpose. Entrench your values and behavior norms at all levels of organization. Change your culture as needed.

• Download our complimentary handout — Developing Leaders of Growth: 5 Critical Factors for Driving Double/Triple Digit Growth

The post 7 Leadership Pitfalls That Sabotage Company Growth appeared first on The Empowered Business.

• Do you know how current trends will change the face of leadership in your company?
• Is your company ready to meet the new leadership challenges in the coming years?
• Are you aware of how leadership is evolving to respond to those trends?

Every leader knows the importance of being strategic.  Being strategic means looking into the future and identifying trends, opportunities and threats.

Below are my 2015 leadership predictions – threats, trends and opportunities – that will change the world of leadership as we know it today.

1.    Complexity is the new normal.

The intensity of change is increasing at an alarming rate. Such changes will pressure leaders to lead agile organizations, while attempting to do more with less in an already over-taxed work environment.

To succeed in this new normal, leaders must become master delegators, change agents and futurists.  They must oversee strategic planning as a dynamic process, not an annual event.  They must become laser-focused on the critical few while filtering out the less important many.

2.   A rising shortage of good leaders and leadership capabilities spells disaster for future growth.

With the continued exit of baby boomers, millennials have become the largest segment of the workforce for the first time.  As a result, millennials are being pushed into leadership roles before they are ready.

Also, many qualified managers are choosing entrepreneurship, rather than continuing to climb the corporate ladder. This trend will exacerbate the shortage of capable leaders.

To deal with this shortage, companies must invest in growing their own leadership talent.  They must develop a continuous pipeline of potential leaders and groom early before undertaking those roles.

3.    The 3 most critical leadership skills to navigate the future will be:

• Advanced “people skills”

Of all the skills a leader develops, the capacity to lead and influence people is ranking higher every year amongst CEOs.  The most important of these leadership skills needed for the future will be:

-   Building a culture of self responsibility and accountability

-   Coaching and developing new leaders

-   Hiring “best fit” talent – in terms of motivations, values and competencies – to drive a high performance culture

• Problem predicting (over problem solving)

Most strategic plans are not really strategic.  Many leaders create annual plans that extrapolate from the past and focus on eliminating current problems (aka “problem solving”).  If such a plan is successful, all that has been achieved is an absence of problems.

On the other hand, a true strategic plan focuses on what you want your company to become in the future, the results you want to create and the unexpected problems you anticipate along the way.  The focus is on problem predicting and the actions necessary to prevent the problems.

• Change leadership (over change management)

Change will only accelerate in the future.  To thrive in such an environment, leaders must know how to initiate and respond to strategic change.

While change management still is important, its main focus is on following plans, creating responsibilities and measuring results. Change management is about things.

Change leadership, however, focuses on leading change – ie., making things happen that would not normally happen.  It’s about inspiring employees to participate and “own” their contribution in future company direction.  Change leadership is about people.

4.      Higher cognitive impairment, burnout and stress amongst leaders is escalating due to information overload.

The rise of mobile communications, social media and web 3.0 have their dark impact on leadership performance, despite the benefits.

• Leaders’ brains are being hijacked due to an addiction to information.

The constant bombardment of information provides leaders with a feeling of new and exciting — triggering the neurotransmitter dopamine and a sense of immediate gratification.

Repeated exposure – in this case, to “information pleasure” – hijacks leaders’ brains to continually seek more information.

The end result is confusion, avoidance patterns in tackling challenging tasks and reactive decision making.

• Leaders are jeopardizing their companies with decision-making fatigue.

Research has shown that, to deal with this constant influx of information, your brain assumes that the latest news is the most important.

Behavioral economist George Lowenstein of Carnegie Mellon University calls this the “urgency effect.” The urgency effect means that your brain tends to overvalue immediacy over quality of information.

The implications of this brain bias are that leaders will feel compelled to make quick (often poor) decisions over right decisions.

• Information overload is inhibiting your leadership creativity.

Leaders’ brains need “space” to synthesize new with existing information and identify new connections and hidden patterns.  With information overload, leaders are less likely to make those crucial creative connections. 

5.    The third evolution of leadership intelligence – what I call Transcendent Leadership — is now emerging.

Leadership styles evolve over time to meet the changing needs and values of business.

Transactional leadership – dominant in the 20^th century –emphasized disciplinary power, the smooth flow of daily operations and rewards/punishments to drive performance.

At the start of the 21^st century, Transformational leadership became the new leadership style — focused on long-term vision, team-building, collaboration and employee engagement.  At the heart of transformational leadership is the development of awareness with such capabilities as Emotional Intelligence and Conscious Capitalism.

What’s the next evolution of leadership?

I call it Transcendent Leadership.  A Transcendent Leader has a level of super-consciousness that transcends the physical world (including time and space) and drives exceptional results through the quantum world — ie., the world of energy, thoughts and spirit.

Photo: Robert Couse-Baker

Transcendent leaders go beyond emotional intelligence and focus on energetic intelligence.  They know how to tune into others’ energies and ignite their deepest motivation and potential.

They have mastery of mind, imagination and energy — pushing the boundaries in what is possible and achieving what is impossible.  They have the ability to “rise” above their thinking mind (aka metacognition) and disconnect from their own perceptual biases and limiting beliefs that hold them back.

6.    Increased time starvation and anxiety will create more crises. 

Many leaders believe that more is better.  That saying yes to everything creates more success.  That going to more meetings feels more productive.  That having a packed calendar is what good leadership is all about.

The truth is … more is less productive.  More creates more crises and escalates stress to levels beyond what leaders know how to control.

Doing more drives an even bigger problem amongst leaders …

Time Starvation. 

Time scarcity amongst leaders is NOT a time management issue.  It’s a mindset issue and a company culture issue.

The drive for more and a leader’s addiction to busyness prevent them from pulling back and reflecting on core issues and strategies for the long term. 

7.   Leadership brain training and coaching will become the new paradigm for developing leaders.

To prepare leaders adequately for the future, companies will need to change how they develop leaders.

Much of today’s leadership development methods focus on building external capabilities and changing behaviors.  While those are needed, both areas are a byproduct of how a leader’s brain is wired.

Leaders’ brains are overtaxed, hit with a level of complexity and information unlike any time before.  Behavior changes nor skills development won’t solve these problems.

The solution requires a new type of executive coach or consultant.   It requires experts in brain training and reprogramming.

Those companies who utilize brain training technologies to develop their leaders will increase performance in days and weeks, rather than months and years from conventional methods.

Summary

Not only will companies need to prepare for a shortage of leaders.  They must also train their leaders with a new generation of leadership skills to succeed in the future.

Companies must also find innovative ways to protect and expand a leader’s most important asset – his/her cognitive brain capacity – in the midst of increased information overload, complexity and time scarcity.

At the same time, experts in brain training and energy leadership are emerging.  These experts can provide leaders with the necessary capacity to think on higher and more complex levels to handle future challenges.

The question is … what are you doing to get ready for these trends?

Remember:  “Fortune favors the prepared.”

_________________________

Denise Corcoran helps growth-seeking companies develop game-changing leadership teams and organizations that drive double and triple digit growth … by design. Her company — The Empowered BusinessTM — is one of the few companies providing whole brain, strategic solutions for unleashing leadership and organizational potential that conventional methods can’t achieve. Learn how to master your Inner Game of Leadership, by downloading our free report – Wired to Win Big. Connect with Denise at her Blog, LinkedIn, Twitter or contact her via email.

The post 2015 Leadership Predictions: appeared first on The Empowered Business.

Today’s companies have it all backwards.  Leaders have a thirst and drive for answers to their biggest challenges.

Thousands of leadership books are published yearly to feed that thirst.  Buying those books to find the right answers for your company is where leaders make their biggest mistake.

 

Leadership is NOT about having the right answers.  It’s about asking the right questions.

If you’ve read my article “12 Strategic Thinking Questions That Yield Big Results,” you know why questions are so powerful and how they can change organizational results … overnight.  If you have not,  click here.

The Make-or-Break Question Critical to Your Business Future

There is one question though, above all others, that smart leaders ask … not just once, but everyday.  This one question has the power to:

• Create sustainable company growth and profitability
• Rise above your competition
• Make you an innovative leader in your marketplace
• Accelerate organizational and culture change
• Increase employee engagement and performance

This one question has equal relevance to both your external and internal environments.   What is that one question?

Where can we win?

Why This One Question?

How many times …

• have you spent great effort and resources on goals and strategies that were never worth your time to begin with?
• has your company pursued markets and customers that actually took you further from your goals, not closer?
• has your company spread itself thin with too many organizational changes, initiatives or diverse priorities?

The truth is …

“There are many battles in business not worth winning.   Worst still is to LOSE such a battle you should have never fought to begin with.”     Denise Corcoran

 Know which strategies and plans will lead you to your goals and which will not.  Distinguish those that create gain and those that create loss.  As the saying goes,

“Measure twice, cut once.”

The Secret to Winning in Your Marketplace

To succeed in today’s rapidly changing marketplace, it is critical for leaders to ask daily …

Where can we win?

And equally important …

Where can we not win?

Where you are winning today is not where you can win tomorrow.  To best answer these questions more deeply requires three steps.

Step 1:  Pause and take a REALITY check.  Challenge every assumption about your current goals and plans.

Take a look at your revenue and profit goals and ask yourself:

• Will your current customers (or desired customers) really get you to your goals?
• What makes you think your plan and expected outcomes are reasonable?
• Did you make up those outcomes and hope that you would reach them?

Remember …

“Hope is not a strategy.”

Step 2:  Dig deeper.  The real truth about where you can win is below the surface.

Even if you think your goals and plans are reasonable, dig deeper.  You will find real answers to your revenue or profit challenges below the surface. 

For example, do you tend to target customers based on their ability to pay your price?  While that is a good start, there are deeper questions you need to ask.  Such as …

• Are they willing to pay you your price?
• Are there competitors driving price resistance?  Are those competitors lowering customer demand for your products/services?
• How do you adapt your plans to this new reality?

If you have hit a ceiling in revenues and/or profits, you need to dig deeper to get the truth about your company’s reality.

Step 3:  Utilize the power of peripheral vision to detect early (often subtle) warning signs that your business needs to shift. 

In today’s rapidly changing world, smart leaders have systems to detect early warning signs that the positioning of their business may need to change. Even if realistic today, your strategies and plans may not be valid tomorrow.

What are examples of early warning signs that your company may need to re-position itself?

• Pressure on profit margins
• Decline in customer satisfaction
• Appearance of new competitors
• Loss of market share in key segments
• Surprises by outside high impact events in the last few years

The key to detecting early warning signs that your environment is shifting is to develop your leadership peripheral vision.

In a literal sense, peripheral vision is an expansion of your normal attention to what’s happening at the edges – the periphery – of your field of vision. You are often in peripheral vision, for example, when driving on a highway, assuming you are not engaging in any distractions.  Your vision expands to see cars in all directions in order to respond in a moment’s notice, if needed.

In the business world, leaders are mostly engaged in their foveal vision — critical for focus on goals and critical tasks of the organization.  However, foveal vision also creates serious tunnel vision to big picture strategic issues and the ever-changing environment in which it operates.

Leaders must train their minds to continually monitor the periphery or edges of their environment for subtle and early shifts. Here’s why.

Peripheral vision …

• Helps you detect emerging opportunities in your marketplace before your competitors
• Gives you early signals regarding outside threats to your growth – such as, new alternative substitutes that can satisfy your customers’ needs
• Helps you anticipate and respond to future unmet customer needs not even their radar screen today
• Slows down your negative internal dialogue that drives ineffective leadership decisions and actions 

NOTE:  To learn about how to develop your peripheral vision as a leader, fill out my contact form and I am happy to pass on resources.

Bottomline:  If your company has hit a growth ceiling … has been on a vicious profit rollercoaster ride … or in perpetual crisis mode, then STOP.

Pause and ask yourself the ONE question that determines the extent your company survives vs. thrive in the future.

Where can we win?

And, if you are feeling bold and confident,

Where will we win?

Ready to get off the profitability and/or revenue roller coaster ride?   Click here to sign up for our 90 minute, complimentary Leadership Edge Strategy Session to develop a leadership strategy to achieve your goals and desired breakthroughs.

Other Related Links

12 StrategicThinking Questions That Yield Big Results.  

How Great Strategic Thinkers Think. 

___________________________________

Denise Corcoran – CEO, The Empowered Business^TM – helps growth-seeking companies develop game-changing leadership teams and organizations that drive and sustain profitable growth by design.   Denise can be reached at denise@empoweredbusiness.com or www.empoweredbusiness.com.

The post The ONE Question Every Leader Needs To Ask appeared first on The Empowered Business.