How People Management Powers Profit & Growth

Juggling the balance between people management and business growth as a CEO, Founder or Entrepreneur requires a careful mix of emotional intelligence and business acumen. This article will provide a recommended system for developing effortless people management skills that enable you to be a self-assured, assertive, but likeable leader.

A founder’s vision to create a highly profitable business relies on a solid product or service, market demand, visibility and an impeccable team of motivated staff to disrupt the marketplace with exceptional solutions or products.

Let’s break it down.

• Good product or service.
• Market demand.
• Visibility.
• Human capital

These four criteria are necessary to create increased business value. According to research by McKinsey Global Institute, many well-known corporations with fantastic products and services operating in hungry markets fail to elevate their profit margins due to a myopic approach to talent management. The research, published in February, 2023 uncovered that companies that focused on the performance (emphasis on the bottom line) and developing their talent were more likely to elevate themselves to “large-scale ‘superstars’” – no matter their sector.

Companies that managed people in a way that challenged and empowered their talent while focusing on the bottom line were more likely to achieve epic revenue than those that concentrated solely on the bottom line (in fact, this mix was the unique set of variables in the companies that were more likely to average $1 billion in profit).

Whether spearheading your start-up and striving to gain traction or heading up a multi-national business venture, this article will provide you with verified strategies for people management.

If you want to generate increased economic success in your business pursuits, your organisational signature needs to 2 key elements:

• Vigilance to the bottom line and growth measured by economic performance
• Tangible and concrete approaches to people management that empower and challenge your team

This is but one study of an incredibly large pile of recent research that emphasises both the benefit and necessity of managing people with foresight, strategy and a deep dedication to creating an engaged and stimulated workforce of employees.

Each year, Gallup releases an annual report designed to represent the collective voice of the global employee- the State of the Global Workplace Report. Here are my key interpretations based on insights from the 2023 report reveals key findings that should matter to you as a CEO, Founder or Entrepreneur:

• Happiness at work is an issue, the report shows, employee stress is at a record high44% of employees are experiencing heightened stress attributable to their managers
• Worker performance is likely to be impacting your revenue, The majority of the world’s employees are quiet quitting.With roughly 6 out of 10 employees quiet quitting globally, the anticipated impact on the global economy is 8.8 trillion dollars, that’s 9% of global gross domestic product.
• Don’t ignore retaining your talent, over half of the world’s employees are job seeking.51% of the world’s employees are on the lookout for a new role that pays more, improves their wellbeing and challenges them with growth and development opportunities
• And just as the Mckinsey research revealed, challenging and empowering employees matters more than where they work.The lack of engagement and the sense of purpose for the most part appears to stem
  from reduced interpersonal connection between teams and their managers according to
  Gallup research

And we wonder why economic growth is slowing, and then if there is a way to solve it?

While numerous extraneous factors contribute to slowing markets and reduced consumer confidence, the opportunity to manage your people better than ever, in a way that affirms, inspires and stimulates your workforce is ripe and in most organisations notably wanting.

As a CEO, you know that the way you manage your investments and financial capital can reinforce or reduce growth margins.

Consider, on the basis of this research, that likewise, the way you manage your human capital will also reinforce or reduce growth margins.

“What can leaders do today to potentially save the world? Gallup has found one clear 
answer: Change the way your people are managed.”
JON CLIFTON, CEO, GALLUP

You can rapidly reduce the risk to your company/s bottom line and reduce your own personal stress and frustration as a leader if you strategically plan  considering how you invest in your human capital.

As a CEO, Founder or Employer, it’s not uncommon to perceive the weight of responsibility to deliver profitable services, products and systems.
Then there’s your board of investors and business partner, or both, to look after without adding the responsibility of paying for your overheads, team wages and benefits.

All the while, popular articles emphasise the need for the CEO and leader to be the likeable, omnipresent, modern visionary- accountable for ethical play, worker happiness and the greater global good.

Perhaps you’re tired of the maxim- people don’t leave bad jobs; they leave bad leaders. Does the onerous task of fixing the workplace lie solely on the CEO as the harbinger of employee happiness?

At Cadenza, we’d be the last organisation to say that employees are unhappy because of your managerial manoeuvres; perhaps too much is expected of the modern workplace. Instead of blaming the dismal data on the state of modern workplaces, let’s focus our attention on opportunity- blame creates no economy.

Consider your position, and it’s a unique opportunity to disrupt your industry and fill bank accounts. Your venture is capital.

Now consider, your humans are too.

“Ideally, you build capital with people so they trust and respect you, and when you make 
a decision quickly, they know why.”
Dan Weiss, president and CEO, Metropolitan Museum of Art

Your unique entrepreneurial position saw you create something from nothing. You either turned a product idea into a production line or a service into a stock-listed corporation.

Imagine if you were to dedicate the same attention to the strategy behind the humans you employ and lead as the services and products you materialised.

The McKinsey results show that superstar companies (amassing profit in excess of $1 billion) experience incomparable growth marked by two denominators:

Expansive financial performance metrics creating profit at scale counterbalanced by talent attraction and retention

Fortunately, there is no mystery as to what is the best way to invest in your human capital because the research is solid in revealing that “companies that build human capital are more consistent and resilient performers.”

Generally, companies that focus on their profit drivers build more profit.
If you focus on talent drivers through people management techniques, your human capital will compound, attracting even more talent.

The outcome? A superscale exponential relationship between the business you offer and the performers you employ to deliver it. It is this thumbprint that sets the large-scale superstars apart. Managing your human capital assets just as vigilantly as you attend to your dollar offer and portfolio will protect you from the financial waste bucket of poorly handled humans, letting them surpass the other big players through the sole differential variable of tactical human capital management.

Here are 4 approaches to people management that you as a CEO can consider that can unfurl your ventures in heightened success without commandeering your time, health and clarity in the process.

The sole onus of worker happiness does not depend on you but needs to be in your orbit.

With the pressures of seasoned entrepreneurship, many leaders and founders retreat away from their workforce as their business grows. Whether it’s to achieve increased clarity to strategise, spend more time with family (or catch up on missed time from the past) or play catch up with the excess cortisol you’ve been dealing with over the decades- it is a normal process for a founder to start to tap out of the frontline to decompress, cope and in some cases even, stay alive.

Since we have data that worker happiness is a delicate combination of the staff member feeling empowered and challenged, it is going to take a little more than words of praise and appreciation, or pay checks.
Here is a research informed braindump of options of concrete strategies you can use to enhance your worker happiness that will directly stimulate your business and human capital:

Emphasise skill development across your workforce & build your machine to create career ascension opportunities to drive retention

Investing in bonuses and pay rises is a direct face value fix, but long term retention and engagement arises from providing opportunities for your talent to gain skills (Mckinsey, 2023).

Consider that employees who receive increased skills development through professional development opportunities, career ascension and engagement are more likely to stay in the role in a crisis, resulting in consistent revenue compared to organisations that fail to invest in their team who struggle to retain staff in crises and experience erratic earnings as a result (Mckinsey, 2023)

THIS CLASS IS A PRIORITY-WATCH IF…⁠

✅ You feel like your personality sometimes holds you back from speaking confidently at work⁠

✅ You don’t know exactly what your communication at work needs, but you know it needs to change fast.⁠

✅ You can’t pin what it is that prevents you from securing a promotion or leadership opportunity and need to increase your executive presence.⁠

✅ Your voice tone doesn’t work for you reliably, leaving you sounding hesitant and nervous when under pressure.⁠

✅ You admire charismatic communicators and wish you could engage and inspire the way they do.⁠

✅ Difficult conversations at work shake your confidence and you want some strategies to control your responses with polish.⁠

Train your middle managers to be elite communicators with impeccable, likeable soft skills

Your middle managers should be precisely trained in leadership communication and rapport building with their direct reports. Just as your reputation as founder and figurehead of the organisation matters to protect your companies brand and public reputation, the professional reputation of the people tasked with leadership among their direct reports can sabotage or serve growth.The direct correlation between manager likeability and staff retention, well being and engagement is one of the greatest organisational risks or opportunities, depending on how you look at it. Middle managers are often positioned to be the henchmen or buffers between the bulk workforce and senior managers. Rather, your middle managers need to be trained to “foster talent,” and be highly skilled in rapport building, persuasive communication, tactical empathy and executive presence since 86% of an employee’s job satisfaction is determined by the direct relationship they have with their manager (Allas & Schaninger, 2020).

You can mitigate risk in this area by ensuring that all leaders receive leadership communication training. Don’t entrust your precious talent behind closed doors with inexperienced or untrained leaders and expect staff to stay. This is potentially your greatest financial liability. If it’s not ok for an unqualified medical practitioner to do cardiac surgery, is it best practice for a people manager to have no formalised training in communicating with people? Be thorough, be accountable, the quality of your leaders has a direct impact on the physical health of your team.

As your company grows, it becomes hard to manage the workhorses, parts, components and systems that provide value driven work to your personnel. Agile and innovative solutions can be envisioned by the business mastermind but your time constraints can deplete the scope of your best intentions to achieve a solid company culture that protects and engages your talent. Corporate communications systems and strategies are a massive opportunity, there are numerous concrete tactics you can incorporate to benefit your organisation.

Corporate communication strategy is a vital investment to protect each touchpoint across the organisation, providing a driving force for successful ventures, company growth potential and marketplace success.

Humans that speak well under pressure, solve problems better under pressure. Just as your communication matters as the figurehead, consider that communication across your organisation is untapped capital. Investing in your team’s communication abilities will mitigate risk and drive growth.

If your leaders can retain composure and instil respect in the face of change management,  and interact with your talent in a way that encourages engagement and retention, your organisation will not only thrive, but the systems you set up will operate with increased symmetry and efficiency. Learn more about how to develop your team member’s communication skills here

Don’t be ashamed of your sabbaticals and off-the-grid time, be strategic.

With the pressures of seasoned entrepreneurship, many leaders and founders retreat away from their workforce as their business grows. Whether it’s to achieve increased clarity to strategise, spend more time with family (or compensate for time lost in the past while building your empire) or play catch up with the excess cortisol you’ve been dealing with over the decades- it is a normal process for a founder to start to tap out of the frontline to decompress, cope and in some cases even, stay alive.

Take strategic sabbaticals. Time in your ivory tower and being off the grid is not something to feel ashamed of, but should be set up strategically to protect your human capital because of the risk potential these activities have to your leadership reputation.

At Cadenza, we work closely with elite CEOs and time poor founders to better manage your communication with the most limited commodity you have- your time. 

We partner with you to strategies ways to minimise the energy expenditure required to generate influence and people facing transformation in your organisation to gain maximal outcomes using corporate communication tactics grounded in research. 

If you want to optimise your already solid people management communication skills to synchronise tactical messages if sleep-deprived, time-poor or work load burdened or in the face of high pressure conflict or a larger workforce with increased people management demands, our elite communication training program for CEOs, Founders and Industry disruptors is the right fit for your needs.

References

• Madgavkar, A., Chaninger B., Maor, D. et al (2023). Performance through people: Transforming human capital into competitive advantage Report. McKinsey Global Institute. https://www.mckinsey.com/

• State of the Global Workplace: 2023 Report. (2023). Gallup. https://www.gallup.com/

• Tera, A. and Schaninger, B. (2020). The boss factor: Making the world a better place through workplace relationships.” McKinsey Quarterly, September, 2022, 2020.

• Hughes Johnson, C. (2022). Scaling People: Tactics for Management and Company Building, Stripe Press