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Understanding Leadership And Natural Energy

Want your board to make a true contribution to your operation? You need board members who are focused and engaged. And the key lies in understanding their natural energy.

Carl Bates

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High-performing companies require effective boards focused on ethical company growth. Such boards depend on each director maximising their contribution, and the board functioning as an engaged team that maximises its collective contribution. Maximised contribution leads to maximised return – for directors and the company.

Natural Energy

To maximise return, each director should function with what is referred to as ‘natural energy’. Your natural energy reflects the way that you naturally think and operate. It is most easily observed in critical moments, when you will always respond in a particular way.

Related: Business & Leadership Lessons from Kumaran of Spartan

A critical or defining moment is usually a brief and intense pressure or turning point, in which your decision or action, dramatically impacts your journey positively or negatively. You will respond in that moment from your natural energy as your instinct kicks in. But your ability to respond effectively and in alignment with your natural flow can be developed through learning and development.

Some people are naturally innovative and intuitively drive concepts, projects and activity forward. Others wait for the right time to make a decision or take action based on their sense of the market, team or clients.

Some people will always be focused on who is affected by a decision and who they can connect with, whereas others will naturally think of the process or the system first and how that should operate. The concept of natural energy acknowledges that different people will naturally be more effective at different activities.

Balancing Your Board

The same is true of a board – a director whose natural energy is focused on detail and analysis could undermine a blue-sky strategy session by firing off too many questions on ‘the how’.

A company that requires a firm hand on implementation, quality and controls could be challenged by a visionary director who wants to always ‘change things up’. Expertise is essential, yet in a critical moment natural energy will always prevail.

We use a profiling tool that accurately positions a person as one of eight natural energy profiles. During the director selection and appointment process, we consider the balance of natural energy across the board to ensure that it is as diverse as possible and likely to have a balanced perspective to its debate and decision-making.

When there is a balance of natural energy around a board room table, there is more effective flow, and in turn results, for the directors and the business. A company that is focused on maximising its growth opportunities should commit to consciously understanding and bringing into balance the natural energies of its board.

No matter which profiling methodology is chosen, its consistent application is critical and increases in value over time as your understanding as an organisation deepens.

Maximising Your Contribution

By understanding your own profile you can develop a deeper awareness of your drives and unique, value-adding perspective. With emotional intelligence you can then consciously focus your point of view in a constructive manner.

Related: How Ian Fuhr Built Sorbet – The Beautiful Business Empire

By understanding the profiles of your fellow directors, there is a powerful opportunity to support them to master their engagement and contribution. For example, if one of your directors is a ‘Catalyst’, who accelerates changes, you would engage them on ‘what’ or ‘action’ questions, whereas you would ask a ‘Coach’ director for their input on ‘who’ questions or team considerations. It works both ways – self-development and the development of others.

Identifying, creating and sustaining your value, which you then leverage, is the cornerstone of working effectively with your natural energy. It requires that you have a deep understanding of your natural energy and that you use it to create, build and deliver value – for yourself, your board and the company.

Carl Bates is a global entrepreneur, speaker, author, mentor and director. Currently based in South Africa, he is a dynamic entrepreneur from New Zealand who guides small to medium businesses to achieve Extreme Business Success.

Leading

What A Grade 1 Sticker Business Taught Me About Business

It’s the very fundamentals that are frequently overlooked amid ambition and “blue sky thinking” – yet, these remain the most crucial element of any business.

Grant Field

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When I was a kid, my father believed that instead of getting pocket money, my brothers and I should learn how to make money. Stickers were the school craze when I was in Grade 1, and we wanted a collection for ourselves, so Dad said if we wanted to buy the stickers, we needed to make the money. So, logically, we started a sticker trading business. Dad gave us the start-up money and took us through the basics of business.

We had a cash float for purchases, and learnt about cost price, mark-up and selling price – very basic accounting. We kept recycling that money, making extra and using it to buy more stickers. Then we worked out that if we increased the mark-up, we’d make a bigger profit – so why not make the mark-up as big as possible? The obvious happened. Our prices were too high, and we lost customers.

Valuable business lesson learnt, we came back down to a mark-up that other kids were willing to pay for.

More lessons to learn

Then people came to us and asked if they could take a sticker today and pay us tomorrow. We saw no reason not to trust them. Guess what? They didn’t pay us back. We had bad debt on our hands. When we sold out of stickers, we had cash-flow issues and couldn’t buy more stock. Dad was there to help us out, though, so we received another capital injection to get back off the ground. And this time, if we did extend credit, we loaded it for the privilege of “buy now, pay later” – another lesson learnt.

We ran a proper ledger for the business, tracking our inventory, sales and profit. Even if our “bank” account was a piggy bank, we had a clear record of what was going on. When I look back on it, none of what I learnt was irrelevant.

Today, I run a leading financial services company with billions of rand running through our bank accounts. Even though the finances of the business are run on a much larger scale, the principles of business – those basic principles that we learnt trading stickers – still power our company. And when I see entrepreneurial ventures failing, or when friends come to me for advice because their business is struggling, it’s almost always because they haven’t got these basics right.

Related: Successful SA Entreps Share Their Most Valuable Business Advice Ever Received

Clarity

One of the most important lessons I’ve learnt is that if you don’t fully understand how the money is being made, walk away. Whether you are dealing with stickers or financial services, the business principles should be straightforward: money coming in, money going out, and profitability.

Every day, I look at an Excel statement of my company’s forty bank accounts. Every day, I look at the cashflow, and unusual big-ticket items get a note so I know what’s going on. It’s just like that Grade 1 business, only on a bigger scale.

Entrepreneur, thwarted

Once the other kids saw the success of our sticker business, they started to want to get in on the action, so they came to market with their own competing products. At first, we were able to innovate as the competition squeezed our margins and started to impact on our profits. Eventually, the whole situation got completely out of hand and the school banned sticker trading for profit.

While I didn’t become a sticker magnate, the lessons I learnt in Grade 1 remain central to every business I am involved with – get the basics right.

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Leading

How To Handle A Director Who Always Says No

Diverse opinions on a board is a good thing — but is it boosting your business, or hindering growth and decisions?

Carl Bates

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Do you have that director on your board who always says ‘no’? Regardless of what the issue is, regardless of the context, who raises it or whether or not it is indeed a good idea, their response is either a simple ‘no’ or an elongated perspective on why they disagree? It can even feel at times that they are actively working against the company and against the board. Although they obviously do not see it that way.

Experienced directors will have multiple war stories related to this subject. Aspiring directors should be aware of how to approach these situations when they arise and how to avoid becoming the subject of such stories.

Develop a culture of trust, candour and professionalism

A board’s conduct must be characterised by trust, respect, candour, professionalism, accountability, diligence and commitment. It is the board’s collective responsibility to build this culture and to engage with one another in a productive and effective way.

Dissent should be welcomed when it is constructive and engaging. The idea of being the ‘devil’s advocate’ for the sake of it however, is not the best way to approach this. Dissent should be based on a real belief that the issue has not been fully debated or creates a real challenge for the company going forward.

If you have a director who genuinely believes a different path is right for the company, hear them out and engage in the discussion. In my experience, this often opens up an issue or changes a detail that when taken as part of the whole, improves the decision-making outcome for the board and the company.

Related: Contributing In The Boardroom

Remove the politics from the boardroom

At the heart of this issue is often politics. Politics between directors, who are also shareholders or executives. Politics between the ‘new guard’ and the ‘old.’ Regardless of the genesis, politics really do not have a place in the boardroom and directors who engage in it should be called out by the chairman or another senior director.

In local government I have heard stories of councillors who always vote ‘no,’ so that whenever something goes wrong, they can say “I told you so,” and show the public why they should be re-elected. But that is indeed politics. The boardroom is a very different space. It is private and discussions should be confidential.

Board rotation, a simple solution

While the removal of an errant director should never just be left to resolve itself, there is a simple solution that can support the easy removal of the most difficult directors. The challenge is that it requires forward planning prior to the appointment of any new director.

Directors should only ever be appointed for a predefined term, with automatic rotation at the end of that term. This does not stop you from reappointing a director for a further period. It is, however, always easier to ask someone to consider a further term than it is to tell them that their time has come and they should resign from the board.

Having a predefined term for a director essentially ensures an automatic resignation period. A simple rotation policy for directors is not just good governance, it is a practical step you can take to provide a way out of a sticky relationship.

Ultimately the board as a whole must address issues that detract from the board fulfilling its function as and when they arise. A rotation policy might provide an effective backstop. A high-performance board is one that will tackle the issue head-on.

Read next: How Diversity Drives Board Performance

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Leading

The Power Pose: Using Body Language To Lead

Use the way you move and stand and interact with others to become a better entrepreneur and leader.

Howard Feldman

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In 2012, the power pose became a global sensation. A Ted Talk by Amy Cuddy hit a staggering 46 million views and became the second most popular Ted Talk in history. The premise was simple – hold a powerful pose and it will not only affect the way you behave but it will even change your body chemistry. Since the talk, the power pose has met with heavy criticism and been labelled as nothing more than pseudoscience. Fortunately for believers, they were proven right. Amy Cuddy released further research this year and it fundamentally proves that this bold stance works exactly how she said it did back in 2012.

The power pose isn’t something that you’d adopt in a meeting or around the office but the science behind it shows how important it is to pay attention to your body language as it can fundamentally change how you are perceived.

Notice how you are noticed

People spend a lot of time reading one another’s body language and the way a person stands or holds their hands or moves can influence how others see them. It’s very natural to judge someone else’s posture, but what about the way they are judging yours? Few people look at how their body language is affecting the way people engage with them.

Related: [Quiz] How Good Are You At Reading Others In Business?

So, what are you supposed to do?

Fake it until you make it

Want to know how can you adapt to become a better leader? You can fake it.

The power pose isn’t the only way to change your mood. Research has shown that whether you laugh naturally or put on a smile and make yourself laugh, your body still releases the same levels of serotonin.

Whether you are really laughing or just pretending to laugh doesn’t matter – they both have the same impact on your demeanour.

Change how others see you

Think about the pose that every athlete adopts when they win a race or achieve something that’s been physically taxing. They hold their hands outstretched in the air. Even blind athletes hold the same pose. It’s big, it’s bold and it’s a physical manifestation of success.

Now consider the defensive pose. The tight hunched shoulders or inward curve of the spine. These poses immediately make a person look nervous, afraid and lacking in confidence. Like the porcupine curling in on itself for protection.

The same ideas apply to daily business life. While the power pose and the athlete pose are not necessarily a team activity, ensuring that you hold your body upright and with confidence means that you’re conveying an attitude of strength. You come across as confident and capable and positive. You are ready to take on anything and overcome the odds.

By contrast, if you are hunched and withdrawn, you come across as nervous and lacking in confidence and these are not the qualities you want associated with you as an entrepreneur and a leader.

Related: (Slideshow) 5 TED Talks That May Change Your Perspective on Life

Body language for entrepreneurs

  • Shake hands like a hero. The way you shake hands with someone is very significant in terms of establishing equality. Be even, be firm but don’t pull people towards you or turn their hands under your own. This makes them feel like you are trying to establish dominance.
  • Create an atmosphere of openness. Maintain eye contact, say hello to people with warmth while holding a strong posture. A warm and open greeting is essential to establishing trust.
  • Do the power pose for two minutes before any meeting or interview. This will get those chemicals stirring and make you feel confident and in charge.

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