Lead by example if you want a profitable business

Encourage and motivate your team and they will work wonders

In Summary

• Many small businesses grapple with a high staff turnover, but fault may be at the top

A businessman
A businessman

“It's so hard to get honest, hard-working employees," business owners often lament.

The common problems businesses contend with employees include theft, lack of customer care skills, frequent absenteeism, lack of initiative and abrupt departures. Many of these problems may have something to do with the business owner's attitude to his or her employees.

In their defence, employees of small enterprises complain of long working hours, harassment, authoritarianism and a lack of professionalism. Gladys Nyange, a former waitress at a roadside cafe on the Nairobi-Mombasa highway, got to work at 5am one morning only to find somebody else doing her job.

“My colleagues and I left the restaurant the previous night at 11pm with no indication from our boss that anything was wrong," Nyange recalls. "When we arrived at work the next morning, we found a fresh set of employees in the cafe. The boss did not explain the reasons for the sudden change. He gave us our money and sent us away."

While big companies demand certain academic qualifications for senior positions, there are no similar requirements in small businesses. That's why lots of businesses are run by individuals with little or no experience in leadership. In essence, entrepreneurs learn leadership through trial and error.

Poor leadership negatively affects a business in many ways. The business will not have good strategies, making it impossible to churn out profits. Business resources, such as money and assets, are wasted on unprofitable activities. Poor communication and lack of teamwork contribute to low productivity. Customers will generally be dissatisfied with such a business.

Poor leadership creates a toxic work culture for employees of the business. Consequently, the employees become unhappy and start leaving. A reluctance to delegate leads to inefficiencies. Favouritism inevitably stokes resentment among employees.

Good leadership will help you build a positive work environment and a successful business. Employees who feel comfortable, engaged and positive will perform better and be less likely to leave.

According to the National Association for the Self-Employed, a good leader must form an effective team. Rather than focusing only on the negatives and ways to punish mistakes, a strong leader will encourage, motivate and lead the team by example. A good leader will promote a culture of collaboration and cohesion.

“If the team feels like they are working towards a shared goal, they will work harder. They will work cohesively to collaborate on projects and ideas that could one day change the company for the better,” the association says in a blog post on its website.

There are many ways for entrepreneurs to improve their leadership skills. Universities, colleges and professional associations offer short, affordable courses for entrepreneurs. It is better to take a leadership and management course than spend years fumbling around the dark.

Find an experienced person to mentor you and share his or her knowledge with you. In turn, you should eventually become a mentor to someone else. Mentoring motivates the mentor and the person being mentored, thus improving both their skills.

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