Earlier this month we held Bibby Financial Services’s International Leaders Conference in Prague. In addition to hearing from inspirational speakers such as economist Ana Boata of Euler Hermes and Peter Mulroy, Secretary General of FCI, the conference was an opportunity to bring together leaders from around the business to share our strategy and plans for the year ahead, and beyond.
Leadership is easily an overlooked virtue amongst the SME community. A company functions around the strategy and direction of its leaders, and so a good leader is just as important for a small business as it is for the largest multi-national. When we think of business leaders our common cultural assumption is to think of CEOs and leading lights in the largest industrial and technology brands. Whilst a big name leader may have a significant impact nationally and outside of their home country, an SME leader is no less important to their home town and local region. Companies are not islands and the business leaders that run them are part and parcel of a healthy and vibrant local community.
Many of the business leaders I speak to are passionate about their community and the purpose of their companies. With an increasing number being driven by digital activities, it can be easy for businesses to become disconnected from their environment. The businesses leaders that do keep their feet firmly on the ground and understand their communities are ones that listen and are dedicated to continuous improvement. A good leader is optimistic that they can make a difference.
Lessons can also be learnt from the largest companies. In a recent study by Board Intelligence 300 UK, board directors were asked if they agreed with the economist Milton Friedman’s statement: “There is only one social responsibility of business – to increase its profits”. An astounding 93% of respondents disagreed with the statement showing that the sentiment amongst top level senior executives in the UK is firmly in favour of purposeful business. In Germany we’ve long seen a similar attitude amongst middle market businesses where many companies take an active part in their regions by sponsoring education, culture and sport.
As 2017 fast approaches, the world will need its local business leaders to be on the front lines and driving us towards a more purposeful and socially responsible business culture.
This means engaging with employees and customers and spending more time understanding the impact of their decisions on the people around them. A good business leader will build long lasting relationships. They will treat customers and suppliers fairly and strive to innovate. Those small business leaders who’ve worked with difficult larger partners will already be familiar with the stresses and strains of late payments or unfair contract terms. A good business leader makes sure that payments are prompt.
A leader should also be empowering employees and enabling customers to make better and more informed choices. This is not only beneficial to their credibility but good for the wider community. An honest and open leader will foster respect and provide personal accountability that in turn will inspire those around them.
‘Doing good’ is a vitally important attribute of a healthy society. The Legatum Prosperity Index ranks prosperous societies: the successful economies which rank highly are also those nations with a high number of citizens that volunteer, give to charity and help strangers. These qualities go hand in hand with the entrepreneurial spirit. Small business leaders are the ones that can drive this kind of behaviour in their employees by setting an example and rewarding those that go the extra mile.
As we approach uncertainty in 2017 with the global economy responding to a new US President and a new European relationship, it is the leaders in smaller firms who can play a big role in leading their communities towards greater prosperity and purpose.
by Steve Box, International CEO, Bibby Financial Services