Entrepreneur as leader

At a recent workshop, a room of business owners were asked, ‘do any of you know what your role is?’ The room was filled with an awkward silence. The silence you get when you realise a good question has been asked by mistake. The silence that fills the person being asked with a mild sense of panic – a realisation that they should be able to provide the answer! After a few moments, someone replied “deal with all the c**p that my staff leave me with!”

What is the role of the business owner? Or, more specifically, how do they make the transition of entrepreneur to business leader?

It goes without saying that the energy needed to start up a business is not the same as the energy required to lead a growing business. One requires a ‘just do it’ mentality, whilst the other requires a whole lot of stuff and patience that many business owners often struggle to deal with. “If I am not doing ‘stuff’, then what is my role?”

To answer this question, we often find ourselves exploring the functions of leadership (referred to in the book Reflections and Challenges – see http://www.telospartners.com/index/reflections.php).

Those business owners who we have observed take significant leaps forward seem to have a canny knack of ‘managing the present’. They do it in a way that allows them to work and provide clarity on ‘creating the future’ and ‘nurturing identity’. “Some of the most valuable time I spend in my business is staring at a blank wall. It is then that my thoughts and ideas crystallise.”

Without doubt, the transition towards business leader moves the business forward – “each time I have let go of stuff, to focus on where I can add real value, the business has jumped to the next level”. It is a transition that has real challenge – “the reason I set up the business – autonomy and control – is the very reason I find it difficult to let go of stuff”. It is a transition that requires a certain leap of faith – “I wish I had managed to trust my team sooner”. It is a transition that is particularly challenging when family is involved – ask any son or daughter who has taken over the business from their mother or father.

The transition appears easiest in those businesses that have a clear plan for the founder to exit the business: “I realised I needed to manage my exit”. And, in planning this exit, they aim to create, to build and to sustain a legacy that lasts beyond the founder.

To do this requires a need to “be bolder about paying for and hiring in the best talent available”; “build a team with everyone on the bus doing the right roles without pandering to individual wants and needs – a clear focus on the ambition and the vision”; “find a way to articulate your vision and values and get your team to develop and create a strong brand together”; “focus, focus, focus – ask the right questions of those who want to help you”.

And of course, to do this requires a need for the founder to behave differently themselves: “entrepreneurs must be confident to lead the business and not so confident that they can’t ask for help and stand in the way of success.”

It is important to note that exit doesn’t always mean sell. On a number of occasions, we have observed entrepreneurs suffering from ‘seller’s remorse’ – a sense of loss and regret that has occurred once the business has been ‘taken away’ from them. Perhaps this a sign that they have not properly thought through the process of ‘passing on’ the business – an insight that we may find develops further with time.

In the pursuit of sustainable success there is a need to think about passing on the business. Given this, some key questions worth asking are:

• What does exit mean to you?
• What heritage are you trying to create?
• What role does your business require you to play (now and when you exit)?
• What is the real value that you can add to the business?
• What do you need to do differently to perform this role?
• Who are your potential successors?
• What are you doing to develop them further?
• How will you manage the transition?

For more information, please review the discussion of our compass meeting # 3 Entrepreneur as leader