5 ways to improve leadership skills and generate business growth
As RGU’s Help to Grow: Management course gets ready for its latest cohort, Programme Leader and Senior Lecturer at Aberdeen Business School, David Gibbons-Wood, shares five key ways that businesses in the North East can improve their leadership skills and generate business growth…
1. Digital adoption
If becoming more digital is still something that daunts you as a business owner or manager, fear not. Few realise just how easy it can be now thanks to a variety of reasons, most pertinently the advancement of technology and amount of resource out there to help. It’s crucially important and I think businesses from all sectors and sizes need to be exploring just how effectively they can adopt digitalisation and build it into their strategy, SME’s included.
It may be something as simple as some paid advertising on social media or selling more products online on an existing platform. Small things that take less time than you’d expect could add an extra percentage to your revenue at the end of the year and reach new customers.
2. Understand your mission and use that to build your brand
Many firms have a section on their website with their mission statement but fail to relate that to how it makes a positive difference for the consumer. It could be that your mission includes something vague such as “be more inspiring”, but why? Are you understanding how your values can link you to your customers?
You can use your mission statement to not only build your brand and identify your values, but also to gain a competitive edge. Resourcing locally and using local products can be part of your mission but also allows you to meet your consumer needs and give you an advantage because the suppliers you’re competing against are competing from across the globe and have neither the local knowledge nor flexible supply chain that can meet local customer desires. Make your mission statement something that not only identifies you but also gives you an advantage over competition.
3. Empower your team
Choose one thing that's going to build the growth of your firm and pursue that. It is easier for start-up firms to have a real focus but the need for common purpose is applicable to all firms. Once a firm is established it might feel like you don’t have the same focus that you did as a start-up. This early motivation can be brought back by giving a small team in your firm the autonomy to pursue one new driver of growth which brings time to concentrate and can rejuvenate the firm.
Make whatever the target is a clear objective for people within the organisation to deliver on and give them some autonomy to go and tackle it themselves. Make it part of the strategy and tie it in with the mission of the group.
Handing over responsibility and entrusting your employees to take charge can have a hugely positive role in the organisation, something to deliver on and actually make business fun, which is of course hugely important. It should alleviate some stress from the top and enable managers to have more time to do what’s more important than anything, leading.
4. Look at the operational data of your organisation
I see the core operations of your business as right through from how you make your product to how people then engage with the ultimate buying process. It’s so important to regularly look at who your product users are whilst continually improving their experience and the efficiency of your production process.
The advancement of digitalisation means almost everything an online consumer does can be tracked so it’s now a lot easier to extract useful data to see what your customers are doing when they come onto your website. Are they spending time on the website and adding something to their basket before stalling and failing to purchase? Or entering the website and leaving very soon after? Both tell a different story and subtle changes can make hugely positive impacts. Knowing the type of consumer that’s visiting your website is an important first step and something that’s essential to continuously monitor. Explore the data, map it out and improve your bottom line as a direct result.
5. Data: Understand the key financial metrics for an SME
Many firms use both financial and non-financial KPIs to help them understand their performance. The Help to Grow: Management course takes our businesses through 6 key metrics that help you understand whether your firm is efficient and successful and I’ll briefly take you through two in this article.
I would draw readers attention to Gross Profit Margin (GPM). This is a simple ratio-based formula on gross profit divided by sales, very useful for businesses that sell goods but not services. A poor figure for GPM tells a leader to review operations and lower the cost of goods sold. It can also mean your product is viewed as inferior by customers and thus prompt review of your place in the market.
The other really interesting and not often used metric is Sales Per Employee (SPE). This is derived by simply dividing total revenue by the number of employees. This is useful for service-based firms and tells you how efficient your people are at driving revenue. Don’t see it as an absolute figure but use its rate of change to track improvements and motivate you as a leader. It can help you understand productivity and lead to better profit levels, allowing you to understand just how important the workforce is!
It wasn’t easy, but they’re my 5 key takeaways from the 12 course modules and what I would prioritise to improve both leadership and growth.
If you are a senior business leader of an SME with ambitions to grow your business, RGU is providing support to transform your company by delivering the Government’s Help to Grow: Management course.
The in-depth, high-quality curriculum will support you to build your capabilities in leadership, innovation, digital adoption, employee engagement, marketing, and financial management. By the end of Help to Grow: Management you will develop a business growth plan to help you lead your business to release its potential. With just one session per week, the course has been designed to fit around the workload of senior managers.
The course is 90% funded by Government meaning participants only pay £750. The sixth Cohort of RGU's Help to Grow: Management begins on 31 March 2023, to find out more and the eligibility criteria please visit www.rgu.ac.uk/helptogrow.
