The Top 6 Leadership Qualities for High-Growth Companies
Predictors for high-performing leaders are more than just past performance and personality. We look at the behaviours needed for high-growth businesses.
By: Leadership Dynamics team
This article is part of our series on leadership qualities.
When searching for a leader to fill a role at your company, technical knowledge, ability and proof of past performance are basic requirements which you can find on a CV. What's harder to find are the more intangible qualities of leadership – how will an individual apply all of their past to a future with you?
After all, a company's strategic objectives, values, mission statement and high-performance culture can only become part of the fabric of the business if its leaders are able to bring them all to life.
This article pulls together the six essential leadership qualities that go beyond the CV; that will help high-growth businesses to keep growing.
Leadership qualities and leaders' behaviours
In our work helping companies analyse their teams to identify the kind of people who will help them achieve success, the two key pieces of the puzzle are:
Individuals with high-performing behaviours
Teams made up of diverse individuals with complementary behaviours
Surfacing personality traits from psychometric tests can only go so far. If we want to understand how people will impact performance, we have to go deeper. And that means understanding individuals' behaviours and how they complement the behaviours of others.
It is better to understand an individual's behaviours because that helps predict what an individual is likely to do in a given situation. Personality traits are static mental states, which can tell you "what" they are like, but not "how" they operate.
It's important to have teams of individuals who function well together, and that's where studying behavioural complementarity comes in, but first you need individuals who exhibit high-performing behaviours. And those are:
1. Leading by example
Delegating has its place, whether in a large cap business or smaller start-up, but in our experience, a leader who remains engaged and when needs be rolls up their sleeves alongside the workforce is more likely to succeed.
Being proactive and optimistic is key, especially in private equity where there isn't time to be pessimistic or simply reactive. Leaders have to get on with the job if they are going to hit the targets of a value creation plan.
By setting an example with their behaviour, a good leader can influence the behaviours of others. For example, they can inspire employees to be more work oriented by using their proactive and optimistic attitude to put in the extra hours finding new solutions to a problem. A leader who is effective in achieving their objectives sets an example to the rest of the leadership team.
The ability to understand one's own strengths and weaknesses is critical for good leadership.
A leader with low self awareness might not recognise when someone else is better suited to a task, nor put themselves forward to lead an initiative when they are ideally positioned for it. Knowing oneself leads to an understanding of how behaviours can impact the performance needed in order to succeed.
If a leader is self aware enough to know what behaviours they need in order to complement the rest of their team, then they can take action with learning and development. Developing the right behaviours is possible only once they know where the gaps are.
Leaders are often put into place due to past performance and the results they've achieved, but not because they are good leaders of people. When you have a star salesperson, it doesn't mean they are going to be a great manager. Without nurturing essential leadership qualities in them first, promoting them to lead a team can have adverse consequences on the performance of that team. If they know where they are lacking, they can begin to practise the right behaviours to become a leader.
Instituting a culture that promotes self awareness – for example, honest feedback and deep reflection – can help your leaders and high-potential employees develop high-performing behaviours.
Take our PACE test for free to understand your behavioural profile.
3. Ability to adapt to challenges
Leaders with a high level of agility are able to adapt to new environments and unforeseen circumstances, which is essential for good decision making and problem solving.
When new challenges arise, leaders have to maintain the BAU part of the job with added work streams on top. Fighting fires while steering the ship is something all leaders will face.
Even when the challenges are part of the plan, leaders need to be able to multitask. This is especially important when, for example, a company is looking for investment. The leadership team needs to be able to manage two virtually full-time jobs: 1) to run the day-to-day and 2) to ready themselves for seeking out and presenting to investors. Being able to adapt to remain effective at both is a top leadership quality.
In these kinds of scenarios, leaders need to be proactive and outcomes-led, but also very optimistic about their success or they could run out of steam.
4. Knowing your audience
Effective communication is key to getting things done. But it requires knowing what drives the person you are talking to.
Similar to the ability to adapt to challenges and circumstances, a good leader will also have the political skills to slightly alter their communication depending on their audience. Being able to understand who they are speaking to and how best to communicate a point to that person will get things done quicker and more effectively.
Understanding how different people operate involves some emotional intelligence, and getting what is needed from them involves some political skills. As we have mentioned, a team is more effective when it includes a balance of not just cognitive diversity but also diversity of age, gender, educational and socio-economic backgrounds. Understanding those differences can help a leader get the best out of their employees as well as their colleagues on the senior team.
If a business is international or is going through internationalisation, there will be cultural quirks that dictate how it operates in different locations. The ability to change ways of working and communicating is critical for leaders who have lines of reporting that stretch across borders and time zones.
5. Consider multiple perspectives
Innovation comes from imagination, and a good leader will use their imagination to step outside convention and consider multiple possibilities when approaching a problem. They need to be open, curious and empathetic enough to understand other people's perspectives, and then be able to experiment with solutions.
This involves taking risks and being comfortable with uncertainty. An ability to have open-ended brainstorming requires a comfort with ambiguity (or a tolerance with being out of one's comfort zone) while finding solutions to a problem. To be willing to try out new and unexpected paths is risky but a good leader will be able to handle the uncertainty and keep experimenting until the ideal solution is found.
6. Growth mindset
Agile leaders are adaptable, but they are also open minded enough to know they are not the finished article.
An individual with high potential to become a leader will have already assessed early mistakes and corrected their behaviour to become more competent at their job and so have a solid history of high performance. With their growth mindset they will be able to look at any kind of setback as a learning opportunity so they can keep developing their strengths to get them to a top role.
This kind of agility helps leaders maintain an edge because they have a continual focus on growth. They see success and failure as part of an indefinite process and so are more likely to have the confidence to take on unfamiliar projects. And when they hit obstacles, they will be able to adapt quickly and pivot to a new strategy.
A true leader will also expand their growth mindset to incorporate the people they lead – sometimes called growth leadership – by constantly looking for opportunities for employees to learn and grow.
How to find the right behaviours when time is limited
While leadership qualities can be developed through learning and development or a culture that nurtures high-performing behaviours, private equity houses and their portfolio companies may not have the luxury of time. They need to adhere to a strict timeline and value creation plan.
With this kind of pressure, it's critical to have the right people with the right behaviours in place as soon as possible.
This is where people analytics comes in. It can save a business precious time and prevent mistakes in hiring or promotion by using data and analytics to pinpoint the exact candidate profile for the role.
Aiming for behaviours over personality traits is the key. This is why we created PACE, our behavioural assessment model that goes deep into situational judgement for leaders, and is based on data from more than 4,000 executive profiles.