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Why Leadership is Important in Business

What is important to business? As we answer the question, we can begin to answer why leadership is important in business.

Making money and generating a profit are undoubtedly vital aspects when considering what is important in business. However, many suggest that making money cannot be the only purpose of a business in this customer savvy, environmental, ethical age where social media means nothing is hidden.

Here are some examples:

Sir John Whitmore, in his book, “Coaching for Performance”, suggests Profit, People and Planet should be the bottom line for a business.

John Blakey, in his book, “The Trusted Executive”, suggests, Results, Reputation and Relationships.

In her article, Katherine Winkler, “Forget the 3 P’s. Here’s a better way to articulate the 3-legged stool”, suggests Economic, Equity and Ecosystems.

The World Needs Leaders

This is why leadership is important in business. Leaders set the tone, culture, climate, work satisfaction and ultimately set the vision and purpose for an organisation.

Business leaders, it could be argued, more than Government, have the power to change our world. In addition, our customers have more power than ever before to expose our motives and insist on high standards. Some business leaders have found this out the hard way.

Maslow’s “Hierarchy of Need” (1943), explained here by Saul McLeod, demonstrated how leaders impact motivation and how self-actualisation is key to increasing motivation. Some leaders are stuck in Esteem needs, often ‘fed’ by the need for higher salaries and expensive lifestyles. Self-actualisation is about growth and purpose.

Image showing Maslows Hierarchy of Need and why Why Leadership is Important in Business

Looking at motivation, it is clear that our younger workforce is motivated by opportunities for growth and development rather than pay (Hannah Wren: Beyond Bonuses). Any business that misses this is likely to miss out on talent retention and recruitment.

To Summarise, Why Is Leadership Important In Business?

  • Leaders have the potential to make the world a better place, both globally and at an individual level

  • Leaders are crucial to motivating the workforce

  • Leaders set the vision

  • Leaders can build or tear down a business reputation

  • Leaders build trust or are proved untrustworthy in the crucible of social media

  • Leaders ultimately are pivotal in creating the long term sustainable profitability of an organisation

This is an impressive list to live up to for any leader. As a leader, it is essential to ask who your safe, non-judgmental voice asks you vital, yet often difficult to hear questions is. Who is on this journey with you?

Leaders Need Coaches

There may be several people who you can identify as being on the journey with you, and an external quality coach may very well be one of them.

An external coach is in a unique position to contract a relationship where questions are asked that are not asked in any other part of a leader’s life.

Questions such as:

  • “If this was to appear in the papers, what would you think?”

  • “If this was to go viral, what would you think?”

  • “If a shareholder was sat with us, what would they say?”

  • “If you think forward 30 years, what would you hear your grandchildren saying about you?”

  • “How does this affect other systems in the organisation?”

  • “How does this affect other world systems?”

  • “This doesn’t sound like you are challenging yourself enough here. What would be a more courageous thing to do?”

  • “How does this build trust?”

It is not difficult to understand why leadership is important in business.

That is why organisations spend considerable sums of money to pay, recruit, retain and train leaders.

Coaching provides great ROI as part of this investment. Coaching is not soft; in fact, a great coach will challenge, provoke and raise the tension in your conversations.

As a leader, consider setting yourself a courageous goal. Be a great leader.

Written by Leadership Coach Ian White


“The Trusted Executive” by John Blakey

“Forget the 3 P’s. Here’s a better way to articulate the 3-legged stool” by Katherine Winkler”

Maslow’s “Hierarchy of Need” (1943) by Saul McLeod

Beyond bonuses: what motivates Millennials, Generation X, and Baby Boomers by Hannah Wren

“Coaching for Performance” by Sir John Whitmore


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