Even during these uncertain times, there’s never been a better time to be in business. It would seem that each day new and emerging ideas come to the marketplace in the hope of leading to success and riches for the entrepreneur that’s prepared to back themselves in and have a go.
But with this mindset comes saturation. It’s well known that the marketplace is dominated by three central themes: Competition, Challenge, and Evolution of ideas. Multiple businesses compete and challenge one another in selling goods and services in the marketplace.
While this is a good thing and is essential for the successful operation of a market economy, it means some in business miss out (or fail altogether).
The statistics for starting, running and succeeding in business make for sobering reading. Year after year, thousands of ambitious and passionate entrepreneurs start new businesses but only about 56% of companies started in 2014 made it to 2018 and according to the US Bureau of Labor, 20% of start-up businesses fail in their first year, 30% fail in their second year, 50% in their fifth year and 70% fail in their 10th year.
It seriously does make you question why anybody would bother packing in a stable job and trying their hand at entrepreneurship knowing there’s such a high rate of failure.
But there’s another way to look at these stats and that is that some do actually prosper and go on to form meaningful businesses. So, it can be done.
Therefore the question becomes not why bother but how can you succeed. And the answer is simple, leadership.
For far too long business owners have operated with a top-down (or waterfall) mentality to how they operate and it hasn’t gotten the best out of their employees.
Top-down management is described as “occurring when goals, projects, and tasks are determined among your organisation's senior leaders, usually independently of their teams. These goals, projects, and tasks are then communicated to their teams.”
So, management decides what to do and staff are expected to follow their instructions. This leads, very quickly, to a workforce that’s uninspired and lacking the energy needed to help the business prosper. That doesn’t mean these employees need to be shown the door. It means the business owner needs to invest more effort into their staff.
In an interview with Inc., Richard Branson articulated why staff should be your focus.
"It should go without saying, if the person who works at your company is 100 percent proud of the brand and you give them the tools to do a good job and they are treated well, they're going to be happy,"
He also went on to say that if employees are put first everybody else wins too.
"Effectively, in the end shareholders do well, the customers do better, and your staff remains happy."
One of those tools Branson is referring to is allowing your employees to operate with ownership culture.
Ownership culture is described by global mamanagent firm Oliver Wyman as “one where employees feel a substantial, personal stake in the company's performance. It creates a situation in which behaviour is guided more by values than by rules; even when “nobody is watching,” people treat each decision as if they were, in fact, the owner.”
Forget ping-pong tables and the occasional free 3-minute massage, the statement above is the best way to build culture within your business. It goes without saying that enabling everyone to take responsibility for their actions and engaging your employees in your company's ultimate objective will always give desirable results.
If you think about high-performance winning teams - be it military, business organisations or sports teams - the one thing they have in common is they are vehicles for extreme ownership. Soldiers, employees and players are empowered to take ownership over what they do, how they do it and the results their actions have.
For any small business, this is a powerful way to build the employee-base you want.
The demands placed on leaders are at an all-time high. Their industries require education, communication, and support. However, the best leaders don't just take responsibility for their job; they take extreme ownership of everything that impacts their greater mission.
They fully understand the importance of self-leadership, knowing that leadership is as strong as the leader. They're willing to make themselves uncomfortable to lead themselves and others to bigger dreams and more significant goals.
And in situations when subordinates are not doing what they should, they don't just blame the subordinates; they first look in the mirror at themselves, bearing in mind that they are fully responsible for explaining the strategic mission, developing the tactics, and securing the training and resources to enable their team to properly and successfully execute.
Like Branson, great business leaders understand the importance of empowering employees.
Your most significant competitive advantage is not producing new products or tapping into new markets; it's the engagement-level of your employees.
A recent study, conducted by management consultants the Hay Group, found that employees who are engaged are up to 43% more productive than those who are not. In real terms, that’s a significant uplift to productivity and has the ability to position what you do as the market leader in your industry.
A leader with an ownership mindset takes the time to praise their employees for doing something right and encourage them to turn their mistakes into learning opportunities and supports employees to take ownership in establishing expectations and defining what success looks like - which means defining the end goal.
Leaders with an ownership mindset, clearly define the end result they want their staff to achieve without dictating everything they must do to reach the goal. They learn to entrust their employees with the “how” knowing that by focusing on the end goal, they are placing trust in their employees, which in turn empowers them. They fully understand that trust helps employees to take ownership of what they do, so that they care about the outcome.
The truth is, employees who are given responsibly are more likely to take responsibility. So as a business leader, let your employees know clearly what end result you are seeking, and give them the trust to work out how to get there. Allow them a means to understand the benefit of this end goal to them and by how being engaged in this end goal will positively impact them at a micro-level and the business at a macro level.
How many times have you sat in a job interview and witnessed an interviewer ask questions directly from a pre-written document and then tick the question off?
While questions are needed to guide an interview, it doesn’t show a lot of thought and certainty won’t allow a potential candidate to express their ownership mindset.
An ownership focused culture will enable a company to take into consideration how a candidate's aptitude and attitude fit into the company Culture, Vision and Values.
Since candidates are seen as potential team members, a robust selection process helps attract loyal and empowered employees; employees who take ownership and responsibility for getting work done, thus reducing the operating costs.
As business leaders, it’s imperative to keep in mind that, when you hire your first employees, you're making a definite choice about the kind of company you will build because your first employees often grow into leadership positions. Knowing this, great leaders don’t hire people they will have to assign accountability to because they know that, that is tantamount to building a company where leaders implement their ideas by enforcing processes and procedures. Instead, they hire owners, which in turn enables them to build a company where employees are engaged and satisfied because they thrive in a culture of autonomy and independence.
Equipped with this knowledge, ownership focused culture enables a company to know how to identify and nurture potential leaders within their organisation. It allows them to allocate resources to the development of these potential leaders, thereby increasing their skills, knowledge, and behaviour.
So, since these employees are responsible for delivering the company's products and services, the training and development process not only leads to an increase in performance, it also helps establish a culture of innovative ideas, as well as developing employee engagement.
An ownership focused culture breeds positive change. It encourages team members to fail forward, make mistakes and learn and ultimately attracts top talents to that company.
It helps to identify team members with an ownership mindset and breeds great leaders.
Ownership focused culture is a surefire way of skyrocketing your business.
"The most fundamental and important truths at the heart of Extreme Ownership is: there are no bad teams, only bad leaders.” - David Goggins
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