What’s the difference between making money and being a leader?
Jonathan Males explains why sustainable leadership means taking a much broader view.
For some businesses, leadership doesn’t matter. Instead, people concentrate on simply making money. That’s fine. It makes perfect sense. But it’s not the way to create a business that’s healthy and robust and has strong potential for the future.
Let me put it like this: you can make money without being a good leader. But you can’t build a sustainable, long-term business without being a good leader.
Shake your money-maker
Businesses need to make money. A profitable business is best for employees, shareholders and customers. So they need people who concentrate on fulfilling tasks and getting results. Let’s call them the money-makers.
In a law firm, they’re the lawyers and partners bringing in the top-whack hourly rate. In a car showroom, they’re the ones closing deals, pushing upgrades and selling finance packages. And in ad agencies they’re the lead creatives – think Don Draper in Mad Men, knocking up an entire campaign over a post-lunch rye and dry.
These people are fundamental to the business’ operations because they’re the ones securing the income. If you’re not sure who they are in your business, ask HR. They’ll be the ones whose talent they value the most highly and protect the most fiercely. The smart business owner or MD will also recognise them, and do everything they can to hang on to their golden goose.
Lead from the top
Sustainable leadership looks very different. While a business’ money-makers can concentrate single-mindedly on the task in hand, a great leader needs a broader and longer field of view.
This is different from the classic model of the heroic leader who single-handedly saves the day. We’re not talking about Scott of the Antarctic or Winston Churchill here – we’re talking about someone who understands the detail in order to see the big picture; someone who builds relationships and engages their people’s heads and hearts. Business demands this all-round awareness in a way that other contexts don’t. The closest parallel is in sport, where the captain whose team prepares rigorously and performs superbly will win more often than not. Running a better race will lead to bigger improvements than concentrating on individual results.
In a lot of cases, the people who bring money into a business are the ones who work their way to the top – and when they get there they find it’s tougher than they’d expected. They never get to concentrate on doing deals because they’ve got so many different demands to balance.
From money-maker to leader
For a money-maker who finds themself in the driving seat, it can be a real challenge to see how they need to change. Let me offer my advice on a few ways to face up to the challenges.
* Connect up what your business does with why it’s important
As a money-maker, you do something over and over again – whether it’s trading stocks or selling insurance – without stopping to think why it’s important. As a leader, you need to communicate that purpose to your people. Everyone needs to understand why their contribution matters. So for an insurance company, it’s reassuring customers when they go to sleep at night. Absolutely everyone – from the IT team keeping the systems up, to the call centre staff handling claims, to the marketing team helping persuade new customers – needs to understand how their job contributes to that overall purpose.
* Manage your own emotional needs so they serve, rather than distort, the business you’re running
After 14 years as Tesco’s CEO, Terry Leahy is stepping down. From his previous role as head of marketing, he’s thrived as CEO, and the quadrupled profits and rocketing share price reflect this. It’s massively unusual for a CEO to last for nearly a decade and a half and enjoy this level of success. Tracy Corrigan in the Telegraph suggests that much of this is down to his grounded manner: ‘It’s not that he doesn’t have an ego… but he doesn’t have the personal vanity that afflicts almost every other chief executive.’
Money-makers tend to be business’ big names, the characters everyone recognises. But the best leaders manage their own emotions so they can best support the business and the people who rely on them – and for money-makers, that means managing that egoism to support the business’ needs, not just their own.
* Understand your business’ relationships and environment
Some money-makers are opportunists who look no further ahead than the next deal. Their relationships with colleagues and customers tend to be purely transactional and their interest in people ends once the deal is done… they’re not worried about ripping people off or doing damage. Opportunists don’t think about the complex web of relationships within a company and with its suppliers, customers and partners… so they’ll often do things for the fast buck, rather than play the long game.
To sum up, sustainable, inspiring leaders know the value of connectivity, of building and maintaining relationships. They also understand that a healthy business is like a living organism in which each part influences all the other parts, which is why you need to think about change carefully, about the impact on the whole enterprise – not just whether it makes money in the short term.