5 Ways Leadership is Different in Small Business

Reliable leadership is a requirement for any business to find success. Having effective leadership is necessary for a company to grow; when it comes to small businesses, this need is only exacerbated. In a larger corporation, whenever there is a lack of leadership, there’s still a broad enough network of employees for the company to rely on to survive. For a small business, this is not possible. With fewer employees and resources, a small business relies even more heavily on its leaders, and it must invest in great leadership.

Understand Your Role as a Leader

Successful leaders need a variety of practical skills to operate well in a small business environment. They have to be able to cohesively represent the attitudes, expectations, goals, and standards of the company to the employees working under them, all while functioning within relatively limited parameters. With a reduced workforce, small business leaders are tasked with a complex role. It is common for small businesses to be still finding their footing and navigating the early stages of business development, so it’s essential to work out how your company appears. What do you want the overall ‘feel’ of your business to be? You will necessarily need to put ground rules in place as early as you can so that the workplace environment isn’t confusing, inconsistent, and ineffective. For example, ask yourself the following questions:

How strictly do you want your dress code to be?
Will you have flexible or more pre-set deadlines?
How much work will you delegate?

Considerations such as these are essential to establish from the start. Set standards for your team and stick to them. You may want to be lenient with deadlines, or not enforce a dress code. Regardless, you must be consistent in your choices to maintain professionalism. Personally, set an example by following these rules (i.e., adhering to the same dress code as you expect from your employees) so your employees feel like they are valued and treated equally to their leaders.

Keep Your Employees Motivated

To further create a safe, open working environment that is conducive to productivity and teamwork, employees must be sufficiently motivated. Motivation is undoubtedly crucial in any business, but when it comes to small companies, you are working with a much smaller team of people, and it means employees need to be dedicated to doing their job to the best of their abilities. Often, leaders conflate ‘motivation’ exclusively with ‘money,’ and while money is an integral factor in the running of any successful small business, it should by no means be the only motivator for your team. An advantage of being in such a close-knit community with your employees is that you can easily inquire as to what other incentives they would be motivated by, whether it’s advancement opportunities, a beneficial work/life balance, varied and challenging assignments, or being a more socially or environmentally conscious company. Listen to what your employees want and follow through by providing them with these opportunities. You are going to have to be more direct. In a small business setting, a leader will be interfacing with employees more frequently and more personally than they would in a significantly larger business.

Communicate and Communicate Well

Excellent communication is a prominent yet often overlooked aspect of great leadership. In such a limited network of employees, practical communication skills are central to successful functioning. Each employee will often have to take on a variety of roles, especially those in higher leadership positions. You will not only be expected to manage the company and your subordinates but also represent the company in an array of situations. Whether presenting to investors, pitching to clients or customers, or working with marketing, a leader in a small business needs to be able to communicate proficiently in a variety of professional capacities.

Define Your Goals

One of the essential skills for a small business leader to have is the ability to design goals properly. It is a common mistake to neglect this seemingly simple task. Setting a goal for yourself or your company may seem easy, but following through takes work. Make sure you design your goals with more than just the final result in mind. Setting incremental goals along the way to your ultimate goal will make it much easier to succeed. You can focus on one step at a time, only ever working toward the next goal, not the daunting end goal. In addition to this, when designing your goals, don’t be vague. Make sure you set yourself a specific timeframe to work within, so you can’t keep pushing back the deadlines as you go. It is also important to remember not to place too much pressure on yourself, your employees, or your company to reach the goals you set. Yes, in an ideal world you would reach them without difficulty, but even if you do not attain the exact achievement you had planned to, you still worked hard to get to where you are, and there’s still useful data and lessons to be taken from your actions and the progress you make.

Make Sure Everyone Understands the Goal

Once your goals are set, be sure you share them with everyone on your team. All of your employees and partners need to be on the same page about the long-term goals for the company so that they can work effectively toward that common goal. In a larger business, setting the goal and projecting your progression towards completing it would be the majority of the work. But most small businesses are not well-founded enough to focus primarily on the day-to-day tasks at hand without keeping the future of the company in mind at all times. It is essential to know the direction you want your company to go and let this vision guide your actions daily. You need to be aware of the opportunities that you encounter and their ability to potentially expand your business. Be forward-thinking in the way you plan, delegate, and enact your daily tasks and responsibilities.