Leadership, and its role in building the culture of an organisation, is a feature of successful growth.
A strong leadership culture helps to provide a clear purpose for the business and its people, as well as helping to build healthy and balanced working practices. These factors ultimately help create an environment where people are highly motivated and can thrive.
Management teams that demonstrate leadership capabilities and develop this skill across all levels of their workforce can see gains in resilience, agility and future-proofing. Leadership isn’t necessarily an innate talent, it’s something that teams can proactively and consistently develop.
When Total Fitness CEO Sophie joined the business, she recognised the power of its people.
Key to transformation was harnessing that power – watch the video to find out more.
Clearly CEO Mick, alongside the wider leadership team, has worked hard to create a clearly defined Employment Value Proposition.
Watch the video to see Mick talk about how they’ve achieved colleague engagement, improved effectiveness and why measuring success is key to sustainable improvements.
Since the Management Buyout in 2018, people have been a key focus for the management team at Orbis, with the aim of reducing employee churn and improving employee engagement.
The work they have undertaken was more important than ever during Covid-19, watch to see CEO Guy talk about how their people helped to get them through the crisis.
Culture as a foundation for success
A common challenge for many management teams is how to align long-term values with day-to-day actions. To be effective, senior leaders in the business need to demonstrate clear vision with everything they do, while also empowering teams to take responsibility and creating a pipeline of talent. Getting this right will result in a culture focussed on leadership at all levels of the organisation.
Perhaps the most important element is understanding the difference between management and leadership, two concepts often grouped together as one in our approach to day-to-day work. While manager mode drives employees to work efficiently and achieve results, great leaders should inspire them to act autonomously and take responsibility.
Management undeniably plays an important role in business, but balancing it with leadership is crucial. This may seem intuitive but it often takes conscious effort to break bad habits. Management teams that can empower everyone in the organisation to ask “What do you think?” to people in junior positions, help better ensure people feel a sense of ownership over their work while also demonstrating a key facet of leadership – an ability to trust.
Effective leadership is more difficult than direct management as it often challenges many old habits. It requires open dialogue, engagement with colleagues and the consideration of critiques – ultimately giving employees the opportunity to think for themselves and feel as though their voice is heard.
The Living Leader, a personal leadership programme, sets out the fundamental differences between management and leadership, and has demonstrated numerous times the impact it can have on driving growth. It also helps to reduce inefficiencies as people are empowered to do their job without seeking constant approval, while also heightening innovative spirit in the organisation.
Selecting or developing leaders for the future requires a forward-looking strategy and culture.Boris Groysberg, Professor of Business Administration at Harvard Business School.
Aligning people with objectives
The bigger picture, and how it relates to internal culture and values, is also a key consideration for leadership teams. Great leaders present employees with a coherent company vision, that aligns with their values and is achieved through clear objectives. This ensures that teams are galvanised across the business and working towards achieving a common goal.
Nigel Shackleton, managing director at PeopleHub Group – a leader in developing people strategies, said: “A real test-case for how robust your culture is how people react to changes. The reason people reject change in organisations isn’t about workstreams or project plans, it’s much more connected to emotion. We’re biologically built to resist change because there’s inherent risk. Because businesses need to change all the time, management teams need to ensure their business engages with its people on an emotional level, helping them to feel connected to their workplace.”
Introducing a culture and a vision provides a sense of purpose for everyone within a business. This is a vital part of building an emotional connection for people to have with their work, ensuring employees can buy into the business and also weather challenges when times are difficult.
Creating this internal purpose is aligned with the “Golden Circle” value proposition model coined by leadership expert Simon Sinek, which evaluates how leaders can inspire cooperation and drive change in business. The model shows that organisations must be able to effectively communicate what they do, how they do it, and, crucially, why they do it, to their staff.
Achieving all three of these elements is the most reliable way for great leaders to resonate with employees, and has a significant impact on internal satisfaction, motivation, adaptability and differentiating an organisations’ brand from competitors.
Two studies by Queens School of Business and the Gallup Organization showed that disengaged workers had 37% higher absenteeism. In organisations with low employee engagement scores productivity was 18% lower, profitability was 16% lower while share price was 65% lower over time.
Leadership at all levels
Training drives the development of senior staff and the creation of new leaders that can go on to maintain and grow a strong company culture. People Hub Group and the Living Leader programme offer an example of how schemes that build a strong cultural foundation, built by employees with well-developed leadership skills, can have a transformative impact on business performance.
NorthEdge portfolio company Total Fitness’s experience with the Living Leader course demonstrates this change in action. A number of the team have completed the Living Leader masterclasses to become trainers themselves, which has then enabled them to train the whole of team Total Fitness.
By integrating the training across the business, and not just stopping at the Senior Leadership Team (SLT), the initiative helped to ensure that a leadership culture is developed across the business and isn’t isolated to the most senior staff. This changes all facets of how the business operates, as a new culture should, improving the quality and tone of communication between team members. Naturally, this then fostered an environment of purpose, motivation and accountability and helped their employee Net Promoter Score rise from -20 to +55 in a short period of time. As you will see from the case study, the impact on the business has been transformational.
Leadership is a fundamental foundation to a healthy company, and leaders across a variety of sectors should look to invest in current and future talent to ensure their business is futureproofed and well-positioned for sustainable success.
The role of Private Equity
Private equity can be a key instigator of investment into leadership strategies, by offering businesses the resources and structures to deliver a culture that pushes them towards objectives. For example, additional backing can be deployed as part of a campaign to hire the next generation of leaders, or portfolio companies can utilise our network to identify the most promising industry talent.
Alongside that, the people plan is a core part of our investment process – helping management teams understand how they can harness the power of their people to grow the businesses, whether that be through new hires, investment in learning and development or supporting the SLT get to the next level in their careers.