The Three Faces of a Leader - Stage 7
The Stage 7 leader is tasked with reigniting the entrepreneurial spirit that characterized the organization in earlier Stages. They achieve this through creating a compelling vision, one that is shared amongst the Leadership Team and clearly communicated to the entire organization. In contrast to the previous Stage, where the leader guided the Leadership Team in creating the vision for the future, the leader is now collaborating with the Leadership Team to create that vision.
In Stage 7, the leader ideally spends 75 percent of their time and energy wearing the Visionary Face, 20 percent wearing the Manager Face, and 5 percent wearing the Specialist Face.
Stage 7 features the greatest concentration on a single face in all the Stages of Growth, with 75% of a leader's time spent wearing the Visionary Face.
The Stage 7 leader is tasked with reigniting the entrepreneurial spirit that characterized the organization in earlier Stages. They achieve this through creating a compelling vision, one that is shared amongst the Leadership Team and clearly communicated to the entire organization. In contrast to the previous Stage, where the leader guided the Leadership Team in creating the vision for the future, the leader is now collaborating with the Leadership Team to create that vision. This marks an important transition, where the Leadership Team is running the day-to-day of the business and begins to set the company’s strategic direction. Connecting daily tasks to the big picture becomes critical to maintain an engaged staff, now that the company is much larger.
The leader wears the Manager Face by managing, mentoring, and growing the Leadership Team, with a special emphasis on the two to three leaders in the succession line for the CEO position.
The Specialist Face should only occupy five percent of the leader’s time and energy. While this is the face least worn by the leader, it is no less important. The leader still has experience that can benefit the organization. Furthermore, a leader who is too far removed from the day-to-day reality risks losing touch with the organization. This creates blind spots that can lead to poor strategic decisions and cause the organization to lose trust in its leader.
Stage 7 marks a significant change in the Three Faces of a Leader. The leader is no longer engaged in active management of the day-to-day operations. Such change can be incredibly difficult, especially for a leader who is also the founder of the organization. In fact, a founder’s inability to align themselves to the Three Faces of a Leader is one of the reasons it is common to bring in a professional CEO in Stage 7.
The common misalignment in this Stage comes from a leader who wants to maintain a higher allocation to the Manager Face, not wanting to give up operational oversight. This can result in a frustrated Leadership Team who wants to take on more responsibility.
If the leader insists upon staying active in operational management, that also means not enough energy is being spent on the Visionary Face. More than ever, the business needs its leader to be working on the business regularly, spending time in critical thinking, and painting a clear vision for the organization. In these cases, it’s common for the organization to experience excessive turnover in the Leadership Team.
Three Faces of a Leader Misalignment
A regional airline that is headed by its founder has been struggling lately. While they continue to offer quality, reliable service, a competitor has begun attracting some of its core customers. The CEO, who is himself a pilot, brings contagious enthusiasm to the company. Lately, though, the Leadership Team is frustrated by his frequent absences. Whereas they are interested in offering the same new features that the competition has adopted, the CEO is focused on his love of the craft. He still flies a few routes and spends a lot of time with his on-the-ground team, talking shop and building loyalty.
The pivotal moment comes when the airline is forced to quit servicing some of its destinations due to a lack of demand. As the Leadership Team faces the urgent need for solutions, the CEO doubles down on his stance. He insists that the to key to maintaining a healthy organization is the time he spends on the job, talking to employees and making adjustments to routes and procedures based on his extensive knowledge. He doesn’t want to “waste his time” trying to predict what the next trend will be.
This organization needs a clear vision to unify its efforts and enable it to plan ahead rather than react to the present circumstances. The CEO is well-intentioned in his desire to stay in touch with the day-to-day operations, but his personal enjoyment comes at the company’s expense. If he finds that he is unable to wear the Visionary Face the majority of the time, the best thing for the company could be for him to find someone who can. In such a competitive industry, stagnation can quickly lead to collapse. A strong vision backed by a robust strategic plan are the most effective means of staying relevant.
The concepts from this article were taken from The Visionary Stage: Organizational ReWilding Rules for Business Growth. Available through The ReWild Group and Amazon, the book explores this and other concepts in-depth while providing illustrations to help business leaders incorporate the ideas into their organizations. Get your copy today to learn the rules for growth for companies with 161-350 employees.
Gates of Focus in a Stage 7 Business
Stage 7’s Gates of Focus are People, Process, then Profit. The number of employees in a Stage 7 company is double or triple what the company had in the previous stage, an increase that demands for People to be the top priority. The primary way a leader can successfully show a focus on People is by investing in the growth of the Leadership Team. The company is too large for the CEO to have regular, personal interactions with all employees. He or she must rely on the Leadership Team (who in turn invests in the Management Team), as the primary driver of successful employee engagement.
Stage 7’s Gates of Focus are People, Process, then Profit.
The number of employees in a Stage 7 company is double or triple what the company had in the previous stage, an increase that demands for People to be the top priority. The primary way a leader can successfully show a focus on People is by investing in the growth of the Leadership Team. The company is too large for the CEO to have regular, personal interactions with all employees. He or she must rely on the Leadership Team (who in turn invests in the Management Team), as the primary driver of successful employee engagement. That said, it’s still important for the leader to regularly practice “management by walking around.” This ensures ongoing individual interaction with employees to communicate that they are valuable, contributing members of the company.
Process is now second priority. The sheer number of people cycling through the company requires effective processes to ensure that quality and scalability can be achieved. For the business to stay relevant to the market, it needs to have an ongoing plan for the investment and methods to encourage continuous innovation.
While Profit is important, it falls to third priority in Stage 7. A company of this size should have its profitability engine in place, with Marketing consistently generating leads, which Sales then turns into revenue and hands off to Customer Service to keep the revenue coming.
Business leaders embracing these Gates of Focus should be constantly thinking about how decisions will impact employees. Their energy should be focused on the development and well-being of the people in the organization.
Gates of Focus Misalignment
A technology company that specializes in home security has found tremendous success due to its highly innovative products. The CEO and founder, who comes from a technology background, has been instrumental in pushing out cutting-edge products that can command higher margins than the competition. With plenty of demand for their products, the company is optimistic about the future and haphazardly adds people to its customer service department to support expected growth in new customers.
Initial sales are strong but there is more churn than expected within the customer base. The overwhelming reason customers give for leaving is dissatisfaction with the service they experience when interacting with company staff. The products themselves are rated highly, but support is far behind. Customers complain about a lack of knowledge, slow response times, and overall frustration with the disconnect between the product and the service.
This CEO has his focus firmly fixed on Profit. After investing large amounts of capital into research and development, he looked for other ways to cut corners to improve profitability. He failed to account for the significant value that trained, knowledgeable employees add to the product. Relying on the product alone to maintain market share isn’t working. He needs to invest in People in order to keep growing the company beyond what the product alone can achieve.
The concepts from this article were taken from The Visionary Stage: Organizational ReWilding Rules for Business Growth. Available through The ReWild Group and Amazon, the book explores this and other concepts in-depth while providing illustrations to help business leaders incorporate the ideas into their organizations. Get your copy today to learn the rules for growth for companies with 161-350 employees.
Builder-Protector Ratio in a Stage 7 Company
In Stage 7, the ideal Builder-Protector Ratio is 2:1, which means there is twice the level of confidence as caution in the organization. The 2:1 ratio reflects a relationship between Builders and Protectors that advances the company at a sustainable pace. The company will need to double its number of employees to grow completely through Stage 7, a process that can take a long time.
In Stage 7, the ideal Builder-Protector Ratio is 2:1, which means there is twice the level of confidence as caution in the organization.
As shown in the graphic, the portion of Protectors in Stage 7 has returned to the same level as Stage 5, indicating a confident organization. This represents a slight decrease in Builder mentality from Stage 6, which positions the business for the long run. The 2:1 ratio reflects a relationship between Builders and Protectors that advances the company at a sustainable pace. The company will need to double its number of employees to grow completely through Stage 7, a process that can take a long time.
This high level of confidence sustains an optimism in the future and fuels the willingness to take the necessary risks to keep the company from becoming complacent. New offerings and strategies will be required as the organization responds to market changes and emerging opportunities.
Just as with the prior two Stages, the Leadership Team needs to be mindful of key individuals who are naturally Protectors. If they press too hard on the brakes, the entire organization will be stopped.
In Stage 7, the Leadership Team is now guiding the strategic direction of the business. At this size, the organization must lean on shared language, values, and structures to sustain its unified culture. This will require significant and intentional energy exerted to communicate with the entire organization, as well as the introduction of a company-wide program that supports and rewards individuals who demonstrate the company’s values.
With a sustainable level of confidence in place, the organization with a 2:1 Builder-Protector Ratio is positioned to mature proportionately across all functional areas and achieve sustainable, long-term growth.
Misalignment can occur when organizations reach Stage 7 without an integrated, professional Management Team and a maturing Leadership Team who are both being challenged to reach a high level of confidence. Weaknesses at either of these levels of the organization may result in the company regressing to previous Stages.
Another contributor to misalignment from the ideal ratio can come from influential, key members of the organization who have not bought into the direction of the company and who serve as Protectors, undermining confidence.
Builder-Protector Ratio Misalignment
A call center company that offers 24/7 support for medium-size businesses has found a great deal of success, in large part due to the consistency of service it provides. The organization has refined its hiring process to the point where it can attract and retain the right kind of talent to provide quality customer service and tech support over the phone. With large new contracts coming in, Human Resources has ramped up hiring to prepare for the influx in the workload.
A shift is taking place in the marketplace, however. More and more companies are requesting chat services in addition to phone support. The company has exclusively provided phone support in the past, and that’s what their employees were hired to provide. When the new clients request chat support, employees are resistant. The recent hires are especially unwilling to shift because they interviewed specifically for phone support, which requires strong oral communication skills, whereas chat support requires strong written communication skills. Many of the Managers are reluctant to make the shift as well. They have comfortable careers with the company and are hesitant to try anything new that might rock the boat.
This company has become stagnant due to an overabundance of Protectors, causing a reluctance to pursue change. It would benefit from a strong message from leadership reminding people that providing support is their number one goal, and while the technology might change, the goal hasn’t. They could also benefit from understanding that they can’t maintain the same size if they aren’t willing to adapt. Status quo is not a viable option, because the company is going to lose clients by refusing to take a chance on change.
The concepts from this article were taken from The Visionary Stage: Organizational ReWilding Rules for Business Growth. Available through The ReWild Group and Amazon, the book explores this and other concepts in-depth while providing illustrations to help business leaders incorporate the ideas into their organizations. Get your copy today to learn the rules for growth for companies with 161-350 employees.
Leadership Style Blend in a Stage 7 Business
The ideal leadership blend for Stage 7 is Visionary, Coaching, and Democratic. Stage 7 leaders ignite the spirit of innovation, grow future leaders, and listen to their people.
The ideal leadership blend for Stage 7 is Visionary, Coaching, and Democratic.
Stage 7 leaders ignite the spirit of innovation, grow future leaders, and listen to their people.
Primary Leadership Style: Visionary
Visionary leaders guide the team and the company with a compelling picture of the future, framing the collective task in terms of a grander mission. They encourage employees to innovate and work towards shared goals that build team commitment. Without strong direction provided by a Visionary leader, the large number of employees in a Stage 7 business will eventually grow overly cautious, causing stagnation and ultimately resulting in retreat.
The Visionary style provides the 200+ people working for the company a clear idea for where the business is headed. Without a unifying vision, departments, teams, and staff will start to go their own way.
Secondary Leadership Style: Coaching
Coaching leaders communicate a belief in people's potential and an expectation that they do their best; they provide feedback and instruction regularly and are willing to put up with short-term failure if it furthers long-term learning.
The Coaching style is critical in Stage 7 because it is needed to grow and develop a Leadership Team that can manage the day-to-day operations of the business.
Tertiary Leadership Style: Democratic
The tertiary leadership style in a Stage 7 company is Democratic.
Democratic leaders focus on promoting harmony in the organization while building a relationship of trust and respect with employees. Listening is a key strength of a Democratic leader, who, in Stage 7, is always seeking out innovative ideas from team members.
A Stage 7 organization should now have fully developed and integrated Leadership and Management Teams. The Democratic leader builds buy-in and forges consensus through collaboration with these teams.
The most common misalignment in Stage 7 is an under-emphasis on the Visionary style. The organization has reached new heights in the number of employees, and now more than at any time since Stage 1 does the organization desire a clear, compelling vision of the future. With the leader turning over day-to-day operations to the Leadership Team, it is time to make the Visionary style primary. Failure to provide sufficient emphasis on vision can cause the organization to lose its way, plateau, and eventually decline.
Leaders who lack a natural strength in this style may find it necessary to rely on other leaders—those who are already part of the organization or someone from the outside—to meet this primary leadership need of a Stage 7 organization.
The second common misalignment is an under-emphasis of the Democratic style. While it is only tertiary in Stage 7, the Democratic style is important to maintain buy-in from the Leadership Team, which is now the driving force of the organization.
Leadership Style Blend Misalignment
The founder and CEO of an innovative technology company has retired. The new CEO, who is promoted from within the company, is known to be a hard worker—someone who is always out in front, demonstrating the drive and productivity expected of all employees. Mindful of the shoes she is trying to fill, the new CEO sets a fast pace for the company, with ambitious goals and seemingly impossible deadlines. Initially, her Leadership Team manages to keep up with her, but over time there is a noticeable lack of energy or excitement. Managers report that morale is not very high within their departments, and turnover begins to increase.
Several months into her leadership, the company suffers a blow when it fails to earn the Innovation Award, an industry prize they had secured five years in a row. The award goes to their main competitor instead. The CEO is shocked by the outcome. She’s been pushing her team hard and can’t imagine asking for more; they’re struggling to keep up as it is. The long hours are starting to wear on her as well, something that never used to bother her under the former CEO.
The Pacesetting leadership style is no longer the most effective style for a Stage 7 company. Instead, the CEO needs to primarily lead with the Visionary style. In this case, the CEO is getting the other leaders in the company to push and work hard, but the problem is that nobody knows where they’re heading. Without a unifying vision, their sprints of effort are effective at meeting deadlines but miss the mark when it comes to creating anything disruptive or out of the ordinary—anything truly innovative. Without vision, employees are following orders but are not empowered to make decisions for themselves. By shifting her focus to where the company is headed and the big picture of what they are trying to accomplish, the CEO can generate momentum and excitement that will once again spark innovation.
The concepts from this article were taken from The Visionary Stage: Organizational ReWilding Rules for Business Growth. Available through The ReWild Group and Amazon, the book explores in-depth this and other concepts while providing illustrations to help business leaders incorporate the ideas into their organizations. Get your copy today to learn the rules for growth for companies with 161-350 employees.
Stage 7 challenge: adapting to a rapidly changing marketplace
Known as the Visionary Stage, one of the top five challenges Stage 7 businesses struggle with is a marketplace that is rapidly changing. With between 161-350 employees, the business has grown to a point where it is no longer quick and nimble like it was when it was smaller. To remain competitive, the organization must be able to methodically identify and pursue market opportunities.
Known as the Visionary Stage, one of the top five challenges Stage 7 businesses struggle with is a marketplace that is rapidly changing. With between 161-350 employees, the business has grown to a point where it is no longer quick and nimble like it was when it was smaller. To remain competitive, the organization must be able to methodically identify and pursue market opportunities.
Typical Symptoms
The typical symptoms that can be found in a company that is struggling with a marketplace that is rapidly changing include:
historically strong offers aren't as popular anymore
difficulty understanding the real needs of today's customers
customers’ needs seem to have changed dramatically
Key Elements to Address the Challenge
The Organizational ReWilding framework is composed of 11 Elements. Each one is integral to the health and full functioning of a business. When a business is struggling with a rapidly changing marketplace, there are three elements that should be implemented to address the challenge.
Ensuring Business Development Structure encourage Marketing, Sales, and Customer Service to work together using synergistic strategies.
Revitalizing the Business Model optimizes margins and confirms key structures and assumptions.
Reinvigorating Key Performance Indicators ensures every employee is contributing to at least one metric that is keeping the organization headed in the right direction.
Why this Challenge Must be Resolved
A Stage 7 company has grown to this point thanks in part to successful products or services that resonate with the marketplace. When that no longer proves to be the case, the company must adapt or face shrinking revenue. With significantly more people than it had before, a Stage 7 company typically has trouble adapting quickly to new feedback from the marketplace. By relying on the structure provided by these three Elements, the business can confidently keep moving forward. It doesn’t have to stop and reassess everything, just focus on the areas that are going to address this common challenge.
To get help with implementing the three Elements recommended in this article, contact The ReWild Group or check out our Element Guidebook Series. Not sure what Stage of Growth your business is in? Use the Stage Calculator to find out!
Stage 7: Creating a Vision for the Future
Stage 7 is not an easy transformation for a CEO, but a critical one to think about in this largest Stage of Growth.
Stage 7 – called the Visionary Stage – is a very different world than previous Stages. In Stage 7, the size of the company ranges from 160 to 350 employees.
The challenge at this Stage lies in addressing the enormous shift in complexity in the organization as the number of employees can double from just the prior Stage. By looking at the business from the perspective of an ideal business model, providing an integrated yet holistic template of how the enterprise could perform, you can apply solutions from a more informed viewpoint. Not an easy transformation for a CEO, but a critical one to think about as a Stage 7 company.
The key objectives in Stage 7 are:
The Leadership team must have a clear vision and communicate that to the organization.
The company must always be selling to keep profitability sustainable.
Setting in place a strong corporate culture that unites the team.
Refining the business model for this largest Stage of Growth.
Focusing first on People, then Process, and finally Profit.
Innovation and Disequilibrium: Great Tools for Larger Companies
In Stage 7, the company has entered a phase that begins to form layers of bureaucracy which quickly impede performance and growth. When a company grows to this size there is an overwhelming tendency for it to gravitate toward safety and equilibrium. It starts to act like a large company, its decision making is slower, the product innovation process is lengthier, and the bureaucracy is formidable. The CEO must recapture the entrepreneurial spirit. In short, he or she needs to systematically ‘break’ parts of the company.
The job of the leader, along with sustaining and propagating the vision of the company, is to create a degree of disequilibrium and chaos within the enterprise. The CEO’s mission is to improve performance by stimulating higher levels of innovation and employee authorship. Stage 7 is a visionary stage of growth wherein the CEO makes an internal entrepreneurial “call to arms.”
A leader can accomplish this transformation by creating a corporate culture that expects, supports and rewards entrepreneurial endeavors. The leader must foster a company-wide paradigm that directs them to identify new opportunities, foster exploration, develop action plans and assign the resources to manifest those plans.
Challenges facing a Stage 7 company include products not differentiated in the marketplace, inadequate profits, too slow getting products to market, marketplaces that change too quickly and again, weak business model.
Why is business model so important in Stage 7? Having a strong business model creates the profit architecture of your company. Not understanding what is driving your profit, what your revenue groups are, and how the company makes and keeps money can cause a company to flounder and potentially die. Many organizations reach Stage 7 and think they’ve got it figured out. They grew this far, right? However, taking a critical look at the business model to evaluate profitability is key to sustainable growth.
The Rules
Some of the Non-Negotiable Leadership Rules for Stage 7 are:
Revamp the company's Business Model to optimize company margins, rethink 3 Revenue Groups, innovate new Offers, and set future strategic direction of the company.
Generate, track, and preserve cash.
Ensure employees know how company makes and keeps money.
Leadership Team practices "management by walking around" daily and interacts at personal level with employees.
Revitalize workplace community by innovating the company core values program and infusing the culture with a specific citizenship recognition and reward program.
Visionary Leadership Is Vital
A Stage 7 leader must ignite the spirit of innovation, grow future leaders, and listen to their people. These traits have not been needed at this scale by the organization yet, so it is up to the leader to hone their skills and navigate the company through the largest Stage. The leader of a Stage 7 organization must be able to act as steward of the company culture and vision.
The leader must ignite a spirit of inspiration and innovation and be relentless in allowing mistakes in the pursuit of these new ideas.
To balance the Visionary leadership style, a leader must incorporate Coaching and Democratic styles as well. The organization needs a leader who can communicate well with employees and coach them to be their best.
The bottom line in understanding the Stages of Growth is that the complexity of an organization will always extract its due. Never be fooled. There is always a price to pay for growth. If you don’t get the infrastructure in place and the workplace community aligned as you grow, the pain of lost performance and profitability will inevitably send you back to the areas that you thought or hoped that you could drive past. Every company goes through the Stages of Growth. Some are aware of it, and some are not. It is up to the leader of the organization to make the choice – to be aware, and to take steps to mitigate the challenges of complexity.
