iMarket Solutions Blog : Posts Tagged ‘Leadership’

Lead Your Company to Growth with These 6 Principles

Monday, June 24th, 2019

Motivation comes and goes.

But if your business is losing money, you’ll suddenly have plenty of motivation. Every hour of work will be dedicated to adjusting prices, improving techniques, and generating more leads.

Let’s say you’re making 12% profit before taxes. For an HVAC contractor, that’s a true marker of success. You could strive to hit 16% and above, but at that point, it’s optional.

Of course, “optional” never motivated anyone. Even the blatant fact that 16% is better than 12% isn’t enough to spark motivation.

The most powerful motivators come from our emotions, and there’s nothing our emotions respond to better than pain.

The way to get that pain back in your life is by holding not just yourself, but your entire business, up to a new set of goals and values. When done successfully, the pain of staying comfortable will grossly outweigh the pain of growing.

By establishing those goals and values throughout the company, they can take root and create cognitive dissonance—the feeling that your actions are not living up to your standards.

Instilling cognitive dissonance will create new thinking patterns and turn them into improved performance:

It won’t be enough to give yourself and your employees a morale-boosting pep talk. Those feelings will hardly last until the next quarter, let alone the next week.

To truly keep motivation for growth burning strong, you’ve got to change thinking patterns, and it all begins with instilling a solid set of principles for growth and execution.

1. Create a Plan and Buy-In

Before you can do anything, you need to start with what Jim Collins defined as the BHAG—the Big Hairy Audacious Goal—in his book Built to Last: Successful Habits of Visionary Companies:

“A true BHAG is clear and compelling, serves as a unifying focal point of effort, and acts as a clear catalyst for team spirit. It has a clear finish line, so the organization can know when it has achieved the goal; people like to shoot for finish lines.”

Your BHAG should consider what’s possible for your business in a ten-year timeframe. Then, reverse-engineer it into smaller goals to mark significant milestones. For example, five-year goals, three-year goals, one-year goals.

The purpose of these goals is to improve the current condition of the company. Examples include factors like pricing, sales process, marketing plan, and more.

Establishing a plan and getting buy-in from the organization will unite everyone’s efforts in moving to the next level.

2. Leadership Matters – Not Just Yours

Good leadership gets people in alignment, and that’s great for getting everyone to work together.

However, leadership also means giving your team a model of success—what we call the “white rhinoceros.”

Try this exercise with your team:

Have everyone draw a picture of a white rhinoceros from their imagination (no cheating!)

Most people will draw it poorly. After seeing a picture of a real rhinoceros, most people will see they mistakenly only drew one horn instead of two.

Did they draw the rhinoceros so poorly because they weren’t trying?

Of course not—everyone was giving the right effort in design and in the work. The problem is that they weren’t sure what the work really was in the first place.

Good leadership is about giving people the model of success. You need to give people the right expectations and define the proper attitudes from the very beginning. If you don’t provide it, they’ll do what they think is best. While that can lead to good work, it will mostly lead to inconsistent work.

3. Raising Others “Up” Is Key

We’ve all heard this old saying:

“Your business is only as good as your employees.”

When your employees get better at what they do, your business gets better with them. The people are the driving force behind the growth.

But as business owner or manager, it’s on you to take ownership and responsibility of their individual growth.

Your efforts for improving your employees should revolve around:

  • Teamwork and interrelationships
  • Training and development
  • Understanding and awareness

There must be a constant thought process about how to improve your employees’ performance. For example, if you have a mid-manager who is a level 7 on the leader scale, how do you bring them up to level 8? And then to level 9?

4. Changing the Entrepreneur’s Work

When you first started the business, you had no choice but to think like an entrepreneur. However, a key factor of growth is evolving from that entrepreneur mindset and into one of a leader.

When you’re working as the entrepreneur, you’re still involved in the day-to-day operations of the business:

  • Directly involved, responsible, and in control.
  • “The passion” behind what happens every day.
  • Living in the world of unknowns—every new day could be a high or a low.

In order to focus on making the business grow, you must step back and become the leader:

  • Allowing others to take responsibility for your tasks.
  • Organizing the business so that the owner doesn’t have to be present.
  • Developing plans for your employees’ growth.

Many business owners are hoping to get to this stage but are unsure how to proceed. The secret is relinquishing control—a thinking pattern adjustment.

It also requires patience and allowing others to fail. Even if you don’t think someone is necessarily on the right path or doing things the way they should be done, there are times where you must let them experience how business works—both in success and in failure.

5. Mastering Accountability

In order to step away from the business, you need to know what direction it’s heading and how to keep it on track. Not only that, but the leaders in your company must be capable of steering the ship, too. The way we do this is by staying accountable with key performance indicators (KPIs).

For example, let’s say you and the manager of the service department both understand that the labor to revenue ratio KPI is 22%. Yet, the data shows 28%. You and the manager should both understand—independently—that there needs to be some investigation into dispatch, travel time, technical capabilities, and so forth.

Teaching others how to interpret the numbers is the first step. The second step is teaching them how to make adjustments based on those interpretations. If you do that, you should be able to reach a new level of accountability that gives you more freedom, gives you the ability to pay people differently, to reward people based on success patterns, and more.

6. Measure the Top Five to Ten Key Metrics

There will be plenty of metrics and KPIs to keep track of, but there are usually 5 to 10 that drive the principles of success and failure in any company.

When you’re making mistakes in the business, it’s not always clear-cut where they’re coming from. But, with a good set of key metrics, you should be able to narrow down the problem.

Not only will these metrics help you understand the business’s weak points, but it will also show you what’s working well.

Refining these metrics, again and again, is key to maintaining growth.

When trying to create and measure essential KPIs in areas outside of your expertise—such as in marketing and customer acquisition—you might need to outsource help to a lead generation company for contractors. Instead of trying to form those KPIs on your own, you can rely on their specialists to set those KPIs and achieve them for you.

Conclusion

As soon as growth becomes optional, we tend to lose the sense of pain that brought us up in the first place.

However, we can find our motivation again with the right combination of growth and execution principles.

Instilling these principles throughout the company can create just enough cognitive dissonance to make it more painful not to grow.

Nothing is more essential to growth than lead generation! To learn more about our lead generation strategies for contractors, contact iMarket Solutions.

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