Capturing Your Best Return
Several years ago, I asked a client struggling to attract and retain good team members why they treated their customers so well but didn't extend that same treatment to their employees. This client, the company's owner, told me he paid his employees to do what he told them, so that's what he expected. He also said his customers were paying him, so they deserved to be treated differently. I immediately replied that he had no business having employees unless he was willing to change that perspective. This reply ruffled his feathers, but that didn't mean I was wrong!
Surprisingly, that wasn't the end of our working relationship. I attempted to help that client change his approach for a while until I learned he had plans to dissolve the business. I won't go into any more of the ugly details, but I will emphasize that it DID NOT have to be that way. Had he been willing to invest even the slightest bit of effort into changing the approach he was taking with the folks on his payroll, he could have built a team rather than just having a few random people showing up for a check.
If we're genuinely interested in achieving quantifiable results by dealing with the profitability killers that are having the most significant impact on our bottom line, the simplest solutions can often make the most difference. But it's critical that we start at the top because that will set the tone for everything else across the organization. I'll stress it once more in case I haven't been clear enough: this doesn't require some magical gifting that's only possible for a select few. Making these behaviors a part of who we are and what we do is as simple as creating any other routine we've ever built into our lives; we need access to the right tools and then decide to apply them!
Of all the areas in a business where additional profit could be captured through more effective top-down leadership, I'm convinced that recruitment and retention matter the most. Cindy and I developed a lesson in 2020 for our Executive Leadership Elite Think Tank, a group of a dozen or so local business owners at that time, called "How Top Leaders Set the Tone for Recruitment & Retention," where we made a business case for how much money organizations lose when the owners and top executives don't understand the importance of their relationships throughout their companies. While this also applies to everyone on our teams with even the slightest bit of leadership responsibility-and I'll break that down in very specific detail soon-the approach those at the top take can make or break a business-just like with the client who seemed to believe he owned the folks he was paying.
And the hard reality is that if we don't give our best people every reason to stay with us, sooner or later (and it's almost always sooner), we'll have a hard time recruiting people to take their place. That's a big enough challenge when we're trying to fill individual contributor roles in any given field, but it kills even more of our profit when the positions we need to fill are ones that oversee critical segments of our business!
Before we dive into the gory details of why Cindy and I built an entire course geared at helping leaders strengthen their organizational approach to Recruitment, Retention, & Culture, let's look at one more area where we'll see the effects of poor leadership from the top down if we're not intentional in how we address it. Then, I'll touch on one valuable thing we can do as leaders to prepare our organizations for a strong future.
Something to Strive For
As we build a top-down leadership model that positively impacts recruitment and retention throughout our company, we can expect that same leadership style to drive results in other areas too, as long as we understand the difference between servant leadership and subservient leadership. I heard Dave Ramsey differentiate the two very plainly a few years ago: subservient leadership is doing things our team members can and should be doing for themselves, whereas servant leadership is doing the things for those folks they cannot do for themselves. He went on to suggest that a servant leader expects their team members to meet (or even exceed) the expectations of their role.
A while back, I had the opportunity to hear a lieutenant colonel who oversees our local university's ROTC program share some successes he had seen from his cadets and some challenges the United States Military is experiencing nationwide. It sounded like overall recruitment across the various service branches was down close to 40 percent. The part that grabbed my attention, though, was when he nonchalantly mentioned that his ROTC program had produced almost double the number of officer candidates based on the targets for a school that size. When he gave us an opportunity for Q&A, I made sure I had heard both stats correctly and asked what he attributed the overwhelming success of his program to when the nationwide totals were so far down. He simply replied, "We've never dropped our high expectations. Good people want to be a part of that."
When business owners maintain high but achievable expectations and practice a genuine servant leadership approach that cascades from the top down, it attracts and retains some of the best people in the respective field, but it also yields a level of performance that doesn't come from carrots or sticks...
In too many scenarios, there's a misconception that a team leader should do whatever they can to ensure their team members are happy or satisfied. Let's be honest; we all know our share of people who are happy to sit on their couch and eat chips. And we can each make a relatively long list of folks who would be perfectly satisfied in a role where they're not held accountable for anything. But when we invest the time and energy necessary to earn influence and lead effectively, it impacts our organization's recruitment and retention efforts and drives employee engagement. Some employees could be perfectly happy and completely satisfied to go through the motions without ever meeting or exceeding what their job requires, but an engaged employee produces results-and they're almost always satisfied in their work!
We'll work through how leaders at any level in their respective companies can address this profitability killer soon. For now, though, my point relates to how a top-down approach leads to capturing your best return! And if we want to ensure the leaders at each level throughout our teams contribute to this return, we'll need to continuously work on building our bench strength.
For Best Results...
There are so many ways that effective top-down leadership can reduce and even eliminate the profitability killers in our businesses, and as I've said, we'll start unpacking some simple strategies for dealing with several of the highest-risk areas soon. But one way we can achieve the best possible results across our entire organization is by taking steps to ensure the influence we earn with our teams personally doesn't stop with us; we need to be very intentional about developing our leaders at every level. To put it in sports terms, we need to build a strong bench!
Even the best companies experience some level of turnover; that's a part of life. If we've worked to build great leaders at the highest levels of our organizations, there's little doubt that we're seeing it show up on the profit and loss statement. But if we haven't been just as dedicated to developing leaders in every other part of the business, I'm sure we aren't doing as well with recruitment and retention as we're capable of, nor are we earning the kind of engagement that produces best-in-class results. If those two things were all we needed to be concerned about by not having effective leaders throughout our organizations-that strong bench, if you will-it would still deserve our attention. However, that's definitely not where the issues stop!
Without that strong bench, we can also expect significant dips in performance any time one of our top leaders moves on, be that into retirement or another company. If we're not incredibly strategic about developing our next tier of leaders so they're prepared to fill gaps as they occur, any given profitability killer can creep back in.
Even this doesn't automatically ensure we'll be able to capture all the profit that's typically left on the table! Just like leadership isn't synonymous with management, we can't focus solely on providing our supervisors and managers with access to leadership development resources and expect peak performance. For best results, we'd provide that same kind of development to every team member who's shown they have influence with the people around them so their message aligns with our mission and vision. Whether as a trainer, an informal department lead, a working superintendent, or a respected peer, their positive leadership skills will impact the performance of others around them!
However, there's one trap we'll need to avoid when we do this. We must fight the urge to automatically push people into formal supervisory and management roles because they're the best at what they're currently doing, and the people around them respect them. We often advocate that as the natural progression and end up losing some of the best players on our bench-from the role they love and sometimes from the entire organization. I'm not suggesting we keep those folks from advancing, just that it should be something they want to do rather than something we've pressured them to do. When we've created a top-down leadership model that's duplicated across departments and at every level, our chances of eliminating any of (or maybe even all) our profitability killers increase exponentially!
With that in mind, let's get to work on dealing with them one by one.
