by Dan Adams, founder of The AIM Institute and author of “Business Builders: How to Become an Admired & Trusted Corporate Leader“
For many companies, 2023 was a doozy. Navigating a shaky economy, rampant inflation, labor shortages, and soaring interest rates has taken its toll. If your company is struggling and you’re not sure how to turn things around in 2024, I have a suggestion: Set a New Year’s resolution to restore your Builder spirit.
Every company was founded by a Builder. Yet too many end up putting a different type of leader — a Decorator or Remodeler or even a Realtor — in charge later. From that point on, whether they know it or not, there’s a long spiral into mediocrity, irrelevance, or even nonexistence.
Yikes. Could the root of your problem be you’ve got the wrong leader at the helm? That’s a good possibility. My company did some research that yielded two key findings:
1. Only one-third to one-half of companies are still led by Builders. The rest have leaders who are fixated on issues other than growth — say, presenting favorable financial performance to investors, or improving operational efficiency, or pursuing external alliances. (These non-Builder types Decorators, Remodelers, and Realtors, respectively.)
2. Companies helmed by senior leaders I classify as Builders consistently experience faster revenue growth than those headed up by other types of leaders.
The C-suite must have a hefty dose of “Builder spirit” — a passion for driving organic growth by delivering differentiated value to customers, a focus on innovation, and an insistence on thinking in years rather than quarters — to stay competitive in a fierce marketplace. Lose that spark and you’re prone to big leadership errors that squelch your own growth.
How can you tell if your company has lost the “Builder spirit” that no doubt burned hot in the belly of its founder? My book explains more, of course, but a few red flags are:
- Revenue growth is sluggish.
- There’s lots of talk about maximizing shareholder wealth (Adams calls this a “false goal”).
- Customer-facing innovation is downplayed (or even neglected).
- There are lots of cost-cutting measures like spending freezes and mass lay-offs.
- In general, employees seem uninspired, disengaged, and unhappy in general, with the best and brightest future Builders jumping ship.
If any of this sounds (dismayingly) familiar, don’t worry: You can restore the Builder spirit, get back on track, and start ramping up growth. Here’s a three-step plan of attack to take starting in 2024.
STEP 1: Start putting Builders in charge.
When you leave a Decorator in charge — someone fixated on making the company look better to investors — you’re failing to inspire employees, and you’re chasing away future Builders. But don’t fire those who aren’t Builders. You need their help to improve operational efficiency, make acquisitions, or look good on Wall Street. You need them, but in supporting roles.
How do you know if someone is a Builder? They should have market-facing innovation in their DNA, a desire to build skills and capabilities, a passion to make things better, a duty to leave the business stronger than they found it, and frankly, they won’t be satisfied doing much else.
(If you want to get real about your own mindset and/or that of other leaders in your company, visit https://www.
You can’t afford to hesitate with changes at the senior leadership level, but you can take more time with middle management. Give them a chance to show what they can do. Establish new measures of success, starting with their ‘duty’ to leave their business stronger than they found it. Ask them for evidence showing they’re strengthening their business’s long-term growth capabilities and their plan to do more of this.
STEP 2: Create a growth capabilities roadmap.
Building the long-term capabilities to become a growth powerhouse doesn’t take place in a single year. Nor does it make sense to bounce from one initiative to another in a haphazard fashion. You need a roadmap that is intelligently formed, embraced by the full leadership team, and communicated clearly and often to all employees.
Start by developing a list of capabilities your company needs for strong organic growth driven by market-facing innovation. For example: customer interviewing skills, competitive insights, R&D capabilities, new product launch, talent management, and culture of innovation (to name a few).
Conduct an employee survey measuring your business’s current capabilities. Then, for each capability, ask them to rate its importance and satisfaction. Prioritize improving capabilities with high importance scores and low satisfaction scores. Next, create a plan to boost those capabilities most likely to impact your growth. Publish your results for all employees to see and make it clear that your goal is to understand and meet customer needs better than others.
STEP 3: Attract new investors who get the benefit of long-term thinking.
If yours is a publicly traded company, you need patient investors who, like you, are focused on the longer term. If quarterly earnings take a dip while you stay focused on the future, these investors will understand. In fact, they don’t want you making poor decisions that damage long-term growth.
When you meet with investors, try to assess if they’re truly in this for the long haul with you.
Too many company leaders make the excuse, ‘We’d like to focus on the future, but investors won’t let us’. That argument doesn’t hold up. In Amazon’s early years, Jeff Bezos led it through seven years without showing a profit. Far from penalizing Amazon, Wall Street cheered it on. Its leader had communicated a vision of growth, and this is what you must do.
One more thing: Carefully time when you start courting long-term investors. Do it too soon, and it might seem like you’ve got a story without substance. Do it too late, and your stock will be punished when you make the right decisions judged by the wrong investors.
I suggest communicating elements of your Growth Capabilities Roadmap when you can do so buoyed by early successes. Examples of market-facing innovation that led to positive financial results will be well received. I’ve seen billion-dollar businesses completely reinvent themselves this way. It’s not easy, and it takes several years. But as a leader, you won’t be on your own. You’ll have many very motivated employees coming alongside to join you.
Now that sounds like a 2024 to look forward to!
Dan Adams is the founder of The AIM Institute and author of “Business Builders: How to Become an Admired & Trusted Corporate Leader“. He is a chemical engineer with a listing in the National Inventors Hall of Fame. Dan has trained tens of thousands of B2B professionals globally in the front end of innovation and works with senior executives on driving profitable, sustainable growth.
