THE PROFIT PRINCIPLE? (Part 5)
Our last Key Framework of Leadership, as you probably expected, is PROFIT. The principle of PROFIT is about two key concepts: ownership and order.
Let’s talk about ownership! When you own something, you treat it differently. Why? Because you come into it with a different mindset. Every summer my family and I rent a house for a week of vacation. We take good care of the house, being careful to follow the rules and not break anything. But you know what we don’t do? We don’t invest in the house. We don’t make improvements. We don’t dream about how the space could be redesigned. We don’t think about how to solve problems. Why? Because we are renters, not owners.
Many of us have a team of renters working with us every day. They won’t break anything, and they will be careful to follow the rules you have set in place. But is that all you want from your team? I don’t know about you, but I want a team that is invested in the business. I want a team that is dreaming about how we can make it better. I want a team that makes improvements to my business because they see themselves as owners.
When your team has an ownership mentality, it will absolutely impact the bottom line. But this mentality won’t magically appear - you have to cultivate it. We do this by creating opportunities, soliciting feedback, and making sure that we prioritize our people over our profit.
This leads us to the second key concept of the profit principle: order. Principled leaders consider profit only after the other four priorities are established. This can be a counterintuitive mindset to adopt, especially when profit margins are thin and the budget isn’t balanced. But the fact remains that profit will only grow the way you want it to if the other four priorities (purpose, people, pace, perception) are addressed first.
Still not convinced? Consider what happens when we put these priorities in the wrong order.
- What happens if you put Perception first? Your purpose suffers because you’re trying to carry on as usual without clarity on vision and values, and you lose your ‘true north.’
- What happens if you put Pace first? Your people burn out, and your innovation suffers.
- What happens when you put Profits first? People suffer. Both employees and customers can end up feeling used and abused just so that you can get the profits you want.
On our worst day, if we’re not careful, all of us will put these Key Frameworks in the wrong order and immediately put a glass ceiling on our success. Instead, we need to make decisions in light of who we are and why we do what we do (Purpose), focusing on the talent we attract and grow (People), all while maintaining a marathon mentality so we don’t burn out (Pace), and with an open mindset so we attract the next generation (Perception).
If we grow all five of these Key Frameworks in the right order, we will set ourselves up to win the war for talent and experience greater levels of success. That’s how we blow through the glass ceiling.