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Running a successful business requires not just a great product and an effective strategy, but also strong leadership and an ability to make difficult decisions.

This is particularly true of small businesses – with fewer resources and staff meaning the decisions you make often have a more significant impact than those in similar positions at larger companies.

In this context, business leaders can often feel isolated, dealing with too many issues than they can effectively address. Particularly now, when businesses are having to continually assess and react to changing operating environments, the number of big decisions that need to be made can feel endless.

Just like any skills, leadership and decision making are areas that can be worked on and improved. It’s important that you establish strong principles and an effective framework for managing your organisation so that in times of crisis or significant change, you’re best placed to make decisions and carry them out confidently.

In time, building these foundations will help not just with dealing with immediate pressures, but also improve your management techniques and better set you up to take risks in the longer term.

Management, decision making, and leadership are topics of huge attention for researchers across the academic and business world. So, whilst this guide written by our strategic partner Be the Business, will only skim the surface of these topics, it should help put you on the right path.

First steps – making big decisions under pressure

Businesses will be making more critical decisions now than ever before. With coronavirus drastically changing how and where we do business, shifting consumer habits and accelerating the adoption of technology, you are likely being forced into making decisions outside of your comfort zone. Whilst this might seem overwhelming, it’s important to remember that you’re not alone with this, with countless businesses of all sizes having to do the same.

Here are some key steps and principles that are worth remembering before throwing yourself into any decision:

  • Remember that not every decision is final or irreversible - it may feel as if any decision you make in difficult times cannot be changed or altered after, but that’s often not true. Take the time to consider the various ways in which it could play out and assess whether every decision is truly ‘make or break’ for your business, or just feels like it is.
  • Don’t make the decision completely alone - as a business owner, it will often feel as if everything must fall on your shoulders. Whilst you may be ultimately responsible, the decisions you make will likely affect other people around you. Take the time to speak to people you trust and those with a useful perspective to ensure you have all the feedback you need to make the best decision possible.
  • Ensure you have an effective decision-making framework in place - there are many different decision-making frameworks out there that will help you to approach your problem. Whether you prefer visual methods or working through thorough checklists, it’s important you figure out which suits your style best. Having a system that you know works well can help make difficult decisions easier and stop things feeling out of control.

Over the next three to six months – becoming a more effective leader

Whilst making decisions is a key element of being an effective business leader, it’s important to reflect on how to be a good leader in every area of your role. This should extend to every interaction, large or small.

In the same way that businesses must respond to rapidly changing external factors, leaders need to adapt their styles to any structural changes. For example, the move towards increased working from home was already a trend impacting how leaders operate, and this has only been accelerated by the introduction of social distancing. Whilst many people prefer face-to-face interactions and find them to be the best way of managing and motivating their staff, you need to take the time to think about how you can adapt to new ways of working, including an increased reliance on technology.

Strong communication is also at the core of being a good leader. Whether communicating with staff or customers, always keep in mind the basic principles of business communication, such as combining different mediums to get your message across, and making sure that you’re actively listening. Keeping in touch is vital to maintaining good customer relationships. Think about what your customers or clients need and want to know. Now more than ever, it’s important to consider how you’re setting up your business to keep customers updated in the event of a crisis.

As your business grows, it becomes less and less feasible for you to make every decision, and being a leader is as much about making decisions as it is encouraging others to make them. Putting the right systems of coaching, culture and support will allow you to be able to choose when you need to motivate your employees, and when you need to enable them.

Over the next year – learning to take risks and managing long-term goals

Over the long-term, your role as a leader will involve managing the ambitions of the business, successfully delivering on your recovery plan and building resilience.

Ensuring your company has the right ambitions can be a challenge even at the best of times, as you adapt to growth and changing markets. In periods of greater change, this can be even more of a challenge, as your focus on survival might make it difficult to consider the long-term goals of the business.

The best way to get back on track is to ensure that you’re following principles for setting goals and doing so in a structured and strategic way. Here are some tips to get you thinking about the best way of setting your companies goals:

  • Like decision making, choosing and sticking to a goal-setting framework can help make it easier for you to develop strategies and evaluate business performance. What’s more, your teams will value having consistency and clarity in what they are aiming for. Once again, there are dozens of frameworks, each with their own strengths and weaknesses. So, take the time to investigate what suits your leadership style best.
  • Setting ambitious long-term goals is a great way to inspire employees, get them to rally around your objectives, and attract the best people. By being bold you can help turn challenges into opportunities and avoid creating negativity by trying to be overly pragmatic.
  • Make sure your long-term goals and short-term targets are connected. To make a bold ambition more achievable, structure your short-term goals so that they feed into this longer-term view. By seeing their work as part of a bigger picture, employees are more likely to be motivated and understand why what they’re doing matters.

Risk-taking may become necessary as you look to achieve your objectives; and as a business leader, it is crucial you understand how to take risks in a way that benefits your business.

Pushing yourself to take risks can seem intimidating, and you might be naturally inclined to shy away from it, feeling there is too much at stake if you do go wrong. However, it may be necessary to take calculated risks to be successful as a business leader. If it helps, start with taking small risks and trialling your ideas, and lastly, understand that mistakes will happen and provide an opportunity to learn.

When working on soft skills like decision making, leadership, goal setting and risk taking, there aren’t many hard-and-fast rules that you have to follow. However, amongst all these areas, understanding the principles of best practice and establishing systems that work well for you will help to refine your skills and reap benefits across your business.

While all reasonable care has been taken to ensure that the information provided is correct, no liability is accepted by Lloyds Bank for any loss or damage caused to any person relying on any statement or omission. This is for information only and should not be relied upon as offering advice for any set of circumstances. Specific advice should always be sought in each instance.

Be the Business

This article was produced by our strategic partner Be the Business. We’re working with Be the Business to help businesses across the UK recover and rebuild.

Find out more about Be the Business

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