By David Garza, Managing Director & CEO,
COMPASS Human Capital Advisors LLC

A new business owner must evolve with the business or risk becoming an obstacle to improvement, innovation, and growth. However, they develop and evolve as the business grows. There are four distinctive leadership phases that an entrepreneur cycles through with their growing business.

Ubiquitous Leadership

Out of necessity, an entrepreneur must be involved in all business aspects to ensure the fledging company gets lift to take off. They are everywhere all the time.

Controlling Leadership

The business grows. The business owner’s omnipresent involvement becomes normalized and it rigidly fossilizes. The entrepreneur gradually becomes a bottleneck as all decisions must flow through them. Opportunities are missed, responses are delayed, and backlogs of important decisions are the norm.

Emancipated Leadership

Some business owners recognize the trap within which they exist. Once recognized, they seek to evolve as a leader, despite their emotional attachments to the business they grew from inception. The entrepreneur acknowledges that they must relinquish control. They seek to build trust with other qualified leaders and delegate portions or most of the business operation within a functional leadership model. The business owner self-emancipates and creates personal capacity.

Effective Leadership

The business owner shifts their focus to improvement, innovation, market opportunities and threats, expansion, and growth. They keep tabs on the business operation to bring attention to issues or opportunities, but they use their newfound capacity to leverage their experience, wisdom, and insight to guide the business and the leadership team forward in the market and industry.

The critical transition for entrepreneurs is between controlling and emancipated leadership. Those who are able to recognize, acknowledge, and successfully traverse the transition have a higher likelihood of long-term business success.