Only 18% of execs have the skills needed to lead. As markets, technology and workplaces evolve, leaders will meet significant challenges and will need to brush up on their foundational skills. Get ahead by leading with innovation in all areas of the business.
As a business leader, it can be hard to know exactly where to focus when everyone and everything demands your attention. For those in charge, schedules are very tight, multiple problems can arise simultaneously and unforeseen challenges can derail even the most rock-solid plans.
The most successful leaders rely on their foundational business skills to tackle these challenges—but the problem is that many leaders are missing these skills. In fact, 82% of leaders lack all the abilities to effectively steer their organization.
What skills do strong leaders need?
Today’s leaders must be able to build trust, be transparent and communicate clearly with their teams. Motivating and engaging employees is also important for driving outcomes and overcoming challenges or adversity. And they must be able to make productivity-based decisions.
Ultimately, the most successful executives have a strong mix of communication, interpersonal and executive-functioning skills.
To gain clarity and provide direction to your teams, start with the foundational basics. Successful business leaders should focus on three areas as their baseline:
- Create a shared vision
- Set strategic objectives to achieve specific performance outcomes
- Offer strategic direction to create value in innovative ways
As challenges arise, these three areas can be your North Star, guiding you and your teams forward. If you start to feel lost or if new challenges arise that can sway you in a different direction, revisit your intended visions, objectives and strategic direction to recenter on the original priorities.
Ushering in a new era of leadership styles
“Traditional” leadership styles are becoming outdated and massive transformations are happening at breakneck speed. Consequently, leaders must pursue new management methods to better facilitate:
- Employee engagement
- Resolving internal disputes
- Improving productivity and efficiency
- Change management
- Making better choices
- Encouragement of ethics, inclusivity and respect
- Promoting a goal-oriented culture
As industries evolve, business leaders can innovate in all areas of the business. It’s not just about technology alone, but as a leader, you can push forward new products and services, define innovative workflows to improve operational efficiency, revise and refine internal processes or completely evolve the business model.
For two well-known examples in the modern era, innovative leaders at Uber and Amazon modified processes at the very core of their operations. By doing so, they not only rose above their competition, but they redefined their industry and innovated completely new ways of doing business.
By considering how to innovate across all departments and in every process, companies like this are shifting business—and the world at large.
Did you know?
Organizations with skillful leaders and higher employee engagement have a higher bottom line (as much as 147% higher earnings per share) than competitors.
You must be compelled to innovate
Naturally, leaders have an innate desire for growth, and many already see “innovation” as the way. To truly succeed, they must not only recognize it, but then implement it.
According to The Boston Consulting Group, 79% of executives rank innovation in their top three business initiatives. They also made a critical observation that the highest ranking companies have a shared focus on research, technology and development, which helps them stay one step ahead of competitors and fuel growth.
Tesla is a perfect example of a company whose investment in innovation has led to unprecedented growth, having surpassed $206 billion in 2020. Through a carefully crafted and deliberate innovation strategy, the company has quickly risen to new heights of success and notoriety. In this instance, strong leadership, vision and innovation drove them forward.
Extinction of Fortune 500s? Innovate to stay relevant
Of course, businesses have to adapt to stay relevant and profitable. If they can’t (or won’t) adjust, they’ll eventually perish. This sounds obvious, but it could catch some of today’s “big fish” off guard.
A recent study of C-suite executives in the US and Europe see digital disruption as one of the biggest threats, predicting that 40% of Fortune 500 companies will be “wiped out over the next decade.”
Leaders who embrace technology will make their businesses more agile, able to disrupt industries and compete against top-industry players. Likewise, leaders will need to adapt to social and cultural shifts—and leadership can’t just stay the course and operate the same way for decades on end.
The oil and gas industry, as one example, has increasingly come under fire for the environmental repercussions of its practices. However, despite these criticisms, many of the top producers continue operating the way they always have. While there are many other factors at play, there will always be opportunities to innovate, adapt and improve a company’s social and environmental impact.
For Civitas Resources, Colorado’s first carbon neutral energy producer, leadership saw an opportunity to do things differently, and have done so with their orphaned well project. The company’s Chairman, Ben Dell, announced that Civitas would plug dozens of wells that were abandoned by other operators in and around Colorado. By making a commitment to do the right thing, they are improving their environmental footprint and taking responsibility for mitigating their lasting effects.
Innovate to differentiate
Innovation is about pushing into new territories—and when done effectively—can support your efforts to differentiate from your competitors. This can help you improve processes and products, which can help you stand out in an oversaturated market.
A great example in the notoriously competitive retail industry, Bombas has been shaking up the athletic apparel industry with its premium-made, cost-conscious socks. Their “sell one-donate one” mission dictates that the company donates one item for every item sold to homeless organizations across North America.
To date, Bombas has made $100 million in profit and has donated 35 million pairs of socks to those in need. This has allowed the online retailer to compete against big industry players while also making a difference in people’s lives.
Working towards a brighter future
For long-term organizational success, leading with innovation is vital. But it takes time, persistence and investment. When done well, it can help build trust and fuel ‘innovation thinking’ that is adopted further down the organization.
Innovation can also require increased working capital to keep up with manufacturing, inventory, payroll, R&D, operational expenses and to launch new strategic initiatives.
If you or your client have an opportunity to take a step towards innovation, but need additional cash flow, alternative funding such as invoice factoring can help. By turning open invoices into positive cash flow, you can continue innovating while being assured you’ll have the funds to meet the demands of the business.
Get in touch if you’d like to learn more about funding options as you take the next steps in your business growth.