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Your definitions are important. When it comes to leadership and business, how you define them affects your behavior, outcomes, and long-term results. It affects everything.

If you define it poorly, you could think you are accomplishing something, when really you are hurting yourself and others. Question: Are your definitions helping or hurting you?

In this episode you’ll hear:

  • What makes a leader and a business successful and why it’s important to define it?
  • What’s the difference between short-term thinking and long-term thinking?
  • What are the negative consequences of short-term thinking and how it destroyed the effectiveness of many businesses?
  • What makes a leader truly successful and what are the qualities of an effective leader?

Resources Mentioned

Full Episode Transcript

(00:15)

How do you define success?

When it comes to business, what makes a business truly successful when it comes to the leader? How do we define a leader and how do we define success of a leader? Because depending on how you define it, is the outcome you will get.

So for example, sometimes people say, oh, that person has this or this such quality. He’s such a leader. Maybe they are, say charismatic for instance. So they have people who follow them. Does that mean they’re a leader? Where if you define a leader as someone who just has someone follow them, then yes, that’s a leader. Or do you define it as someone who’s a good leader, who gets good results, and who treats people well?

I mean, how do you define a leader? And do you define it as the outcome or just the fact that they have someone follow them? Because people can be charismatic, people can people follow them, but that doesn’t mean they get good results.

And I think sometimes that’s the danger of when people talk about certain qualities or this person’s a leader, he’s this type of leader, he’s this style of leader, he’s this, they focus on certain aspects because people are following them or they have a good quality, but it doesn’t mean they actually are an effective leader.

They don’t necessarily get good results. So when it comes to leadership, how do you define leadership? When you think of a leader and you’re thinking of qualities or you’re thinking of what makes a good leader, do you think about the results or just the fact that they have people follow them or they give the appearance of it?

(01:47)

Short-term vs Long-term Thinking

Similar to business, how do you define success with business? Simon Sinek, in his book, the Infinite Game, talks about two kinds of games. He talks about the finite game and the infinite game. Now with the finite game, it’s something like chess, football, soccer, baseball, etc.

There are a set of rules you follow and there’s an ending. When you’re done, someone wins, someone loses, and it’s a finite game. However, there are also infinite games that they keep going and they go and the rules change over time.

The way things work over time, there’s never actually a win where, okay, it’s ended, we’ve won. It keeps going. For example, if you think of relationships as a game, relationships are an infinite thing. Your friendships, the way the government works, government planning and goals, and going forward, there’s no end to it.

Same thing with business. It’s an infinite game. The rules change and the way things work changes. And there’s not really a set end. There’s not really a way to say, we won. Even saying, hey, we’re the best. That’s very relative.

Like how do you say you’re the best? Like what defines best? Does it mean you’re making the most money? Does it mean you have the best customer service? Does it mean that most people follow you on social media? What makes you the best? And how do you define that?

That’s a very relative term. The problem with the love of businesses is they don’t think in an infinite mindset. Long term they think very finite, they think of a certain goal, and they’re done. They think in the frame of making money.

Now, one of the things that Simon Sinek talks about was Milton Friedman and the theory that businesses need to focus solely on the shareholders and getting them their return. And just talking about that has really destroyed the effectiveness of many businesses because people focus on that versus people versus purpose.

It has a lot of negative consequences and so a lot of businesses have very short-term thinking because of that. Their goal is to make money this quarter. Their goal is to make money, show growth, and show a profit for this quarter, for this period of time.

And that’s what’s making them successful. However, the problem often ends up in long-term failure because they’re propping up their business to show growth. So, they do acquisitions, they do layovers, they do all this stuff just to show growth, just to show money coming in so they can show something to their shareholders, to whoever’s looking and long-term they’re killing themselves because they have a very short term thinking versus thinking of the infinite game, the long term.

So if people are hurt, the businesses are hurt long term. And that’s why many businesses fail because they have that finite mindset. So when it comes to success as a business, what makes it successful?

Is it making money right now? Isn’t making money in this quarter? Is it showing growth or is it kind of more of long-term? Think if you are sacrificing the long-term for the short-term, are you really being successful?

If you’re thinking long term and you’re doing things to implement long-term growth and long-term success that may mean short term you make less money. That may mean short term you don’t show growth.

Is that bad? Is that failing in my opinion? No. I think the long-term’s the way to look, but it all depends on how you define success. People view business in that very finite mindset.

(05:17)

What makes a successful leader?

Let’s go back and focus on the leader again. So what makes a successful leader? Is it just that people follow them? Is it that they just get results? Is it that they’re successful while they’re the leader? What makes them successful?

If you look at it, sometimes leaders come in and seem successful while in there. The business and executive CEO are just different parts of the company. They’re in that part, they do well, they make money, or whatever they define success for that leader.

Then, they leave and everything falls apart. And for that leader, he’s like, “See, I’m what made it successful.” But is that really a success when the leader leaves and things fall apart? Was that leader truly successful?

In my opinion, no, because an effective leader is one who prepares for succession. An effective leader is one who raises up other leaders.

"An effective leader is one who prepares for succession." ~ Thomas R. Harris Click To Tweet

People can come in and their force of will bring about some results. But if it’s their force of will and they have yes men and yes women always following them, saying yes to whatever they do, and people don’t innovate, then they think for themselves, they leave and everything falls apart.

Were they really successful? No. If the leader gets results and they do well for the company in whatever metric they’re looking at, but they treat their people poorly and badly and they end up being a toxic leader, were they really successful?

In my opinion, again, no, because part of me thinks about, okay, they had some results, but what kind of results would they have been if they’ve used influence, if they treated people well, if they built a good culture, they may have gotten results, but what better results could they have gotten?

"An effective leader is one who raises up other leaders." ~ Thomas R. Harris Click To Tweet

So how do you define success? How do you define a leader and what makes a leader successful? How do you define what makes a business successful? Because how you define it matters as for me, I look at what makes an effective leader who through influence gets good results.

Just because someone may be charismatic doesn’t mean they’re a great leader. In fact, in Jim Collins’ book, Good to Great. He found that none charismatic leaders were more effective generally than charismatic ones.

I look at business as more of an infinite game. I think it’s about treating everyone well, all stakeholders well, and thinking long-term, not just short-term results. So when you hear me talking about leadership and great leadership and good leadership, that’s what I mean when I’m talking about business in the successful business. I’m thinking of the long-term view. And I hope you do too.

    Thank you so much for listening to this episode of No More Bad Leaders. If this episode meant something to you, I would be honored if you share it with someone who would benefit from it. You can find more episodes here.

    If you have any comments, questions, or inquiries, feel free to contact me.

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