What defines successful leadership today?

What does it take to successfully lead a growing business today? It's probably not the specialist skills your business was first founded on. As the number of staff grows, the role of a business owner shifts from 'do-er' to 'leader'. From specialist to generalist, and from problem solver to agenda setter. That transition doesn't always come easily or naturally.

"Trust and empowerment is a key theme of leadership today," says Andrew Rasby, General Manager, Lending with Yellow Brick Road. Having begun his career as a bank teller in 1988, he is now responsible for 40 staff plus 160 franchise businesses.

He says his biggest challenge was teaching others to do the tasks he had previously done – and believing in their ability to do it. “You can't take over and check in too often,” he says.

So what are the most important behavioural traits today’s leaders need to develop?

1. Empowering trust

“I’ll let people skin their knees, but I won’t let them get a compound fracture.” That’s how Rasby defines the delicate balance between trust and responsibility. “They can feel empowered to run with opportunities and ideas, to take the initiative, but I won’t let them come to any major harm in the process.”

It's natural to stick within your comfort zone, and keep managing the functions you know well. But if your role is to oversee the whole business, you need to give others space to grow. And if you bog yourself down in the day-to-day demands of meetings and tactical activities, you'll lose sight of the bigger picture-what's happening externally, how that impacts your strategy, and how you're performing against industry benchmarks.

2. Asking the right questions

When you make the transition from specialist to generalist, you are no longer the expert and you may not have all the answers.

“I’ve been out on the road since I took over a new team, seeing what’s really happening,” explains Rasby. Continuing to ask the right questions of the right people will help you understand what is really happening across the business – and any hidden challenges or opportunities.

Rasby says understanding the customer’s perspective is just one thing he admires in Mark Bouris, Executive Chairman of Yellow Brick Road. “He is genuinely interested in what goes on in his business, and when he acknowledges he’s made a mistake he moves quickly to fix it,” he says. “I think that takes gumption for a leader of his stature.”

3. Open to new ideas

Asking questions can sometimes lead to uncomfortable truths. But it’s important to be open to thinking that challenges your own.

"We're managing a new generation today, with different ideas and motivations, and I think we have to adapt to that," comments Rasby. "They want to see a clear career path and structured development planning, and they expect access to technology to manage their workload."

4. Balance

Depending on the size of your business and structure, you may need to be both a manager and a leader. You’re responsible for both the ‘why’ and the ‘how’ of your business, and that means being able to focus on both people and processes, purpose and profits.

The most important thing is to spend time on what's important, rather than what's urgent. Prioritising opportunities and threats in this way will also help you rationalise and stay focused.

"I have a mentor, who helps me bounce around ideas and plans," says Rasby. "With disruption and changing risk appetite, we need to keep an eye on marketplace changes and knowing when to move or not is a key skill otherwise you will get exhausted and not keep to your plans."

5. Diplomacy

Bringing people with you on your vision takes more than great communication skills. Managing conflict, and negotiating resolutions both inside and outside the business, is a leader’s responsibility. This may mean building alliances with natural competitors, or influencing regulators, the media or industry groups. 

“Looking back, I think I could have managed up and down a bit differently,” admits Rasby. “I would ask more questions to understand people’s motivations.”

6. Emotional intelligence

Leadership is ultimately about people – inspiring them, acting as a role model and supporting them through both professional and personal issues.

“Although there’s a saying that ‘professionals act as they must, not as they feel’, I think people need to know you’re human as well,” says Rasby. “Show more of yourself, your emotion or humility. Your staff will have key inflection points in their career and personal life, and being aware of this and managing and leading in a supportive way during these times is essential for culture and their belief and trust in you as a leader.”

7. Sustaining your legacy

Rasby says a business leader’s ultimate responsibility is ensuring their business will thrive in the future.

"Know your financial drivers, because that will help you assess new ideas," he comments. "Make sure your business is adequately protected with a succession plan and insurance, because a setback could take away your business in a heartbeat. And have an up-to-date business plan you can constantly check back to."

In turbulent times, the role of a leader has never been more important. Your team needs you to inspire them, but you should also let them take the initiative to fulfil common goals. All these traits can be developed through experience, and through the ups and downs of growing your business and empowering your team.

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Additional information

This material has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL & Australian Credit Licence 237502 ("Macquarie") for general discussion purposes only, without taking into account your personal objectives, financial situation or needs. Before acting on this general information, you must consider its appropriateness having regard to your own objectives, financial situation and needs. The information provided is not intended to replace or serve as a substitute for any accounting, tax or other professional advice, consultation or service.