Profitability vs People – A Leadership Challenge
As the captain of an aircraft, most duty periods are made up of moments of high-decision-making requirements, balanced by moments of great appreciation for the incredible elements of the job you do – such as the view from your office window.
One of the hairiest decisions you’ll ever be called on to make as a captain is to assess the financial implications of an action vs the safety of the people you carry on board your aircraft. Perhaps you’re presented with a technical issue shortly after take-off that requires you to return to land – a decision that may require you to dump the fuel you expected to burn before you landed at your planned destination. Fuel that now means you’re over the weight your landing gear can accommodate if you land immediately. Fuel that represents both a large financial consideration, as well as the difference between a safe landing and one that may end in disaster.
A less hairy version of this consideration may be navigating around weather that would otherwise make the flight extremely uncomfortable for passengers, and possibly unsafe for the aircraft. These diversions also require you to use more fuel than estimated, which adds up flight after flight and affects the bottom line of the business.
The captain of an aircraft probably spends more time balancing profitability and people than they realise – and this juggle isn’t confined to leaders in a cockpit.
Leadership is an art, not a science. It’s a skill that requires constant learning and refinement to achieve the perfect balance between financial profitability and taking care of the people who make up your team. Anyone who’s every headed up a family, a department or team, or an entire business can tell you so. Leaders are accountable for the financial success of their undertaking which often means making tough decisions that may not be popular with the team. On the other hand, building a strong internal culture and relationship within the team is essential for long-term success, employee retention, and overall organizational effectiveness. Without a strong internal culture that promotes collaboration, communication, and trust, team members can feel undervalued, disengaged, and demotivated, resulting in high turnover rates, low productivity, and ultimately, a negative impact on success as a whole.
Responsibility for both the financial success of the business and the well-being of their team can feel stressful and many leaders feel torn between their desire to build strong relationships with their team members and their need to prioritize financial profitability. They may also feel a sense of responsibility to ensure that their team members are happy and engaged at work. This can lead to feelings of guilt or anxiety if they feel like they are not doing enough to create a positive work environment.
Here are 4 areas worth focusing on:
- Effective Communication
Communication is the cornerstone of good leadership. It’s a skill essential for building relationships and fostering a positive work environment. Effective communication involves the ability to convey ideas, listen actively, and create an open and transparent dialogue with the team. Leaders who communicate effectively can build trust, respect, and loyalty among their team members.
Achieving effective communication requires that leaders are empathetic, and openly invite and understand the perspectives of their team members. This involves active listening, asking questions, and seeking feedback to gain a deeper understanding of their needs and concerns. Empathy is essential for effective communication because it helps leaders connect with their team members on a personal level, understand their feelings, and create a sense of belonging. If you’d like to understand how empathy is a strength rather than a weakness, you’ll find a link at the bottom of this page.
Leaders can also communicate effectively by being transparent and honest with their team members. This means sharing information about the business’s financial objectives, challenges, and opportunities. When leaders are transparent, team members feel included and valued, which fosters trust and loyalty.
- Investing in Team Building Activities
Team building activities are a powerful tool for building relationships and fostering collaboration within the team. These activities provide opportunities for team members to get to know each other on a personal level, build trust, and develop a sense of camaraderie. These activities can take many forms, including retreats, team dinners, or even simple activities such as team lunches or social events. The reason ‘team building activities” are normally an eye-rolling experience is that the needs and preferences of the team members are often not considered when planning them.
Some team members may prefer outdoor activities, while others may prefer more structured indoor activities. Leaders need to be empathetic and understanding of the different personalities and preferences of their team members to ensure that the activities are engaging and enjoyable for everyone. You’re aiming for involvement, fun and a depth of connection – rather than just ticking the box that says you’ve done the exercise. If in doubt, draw on the experience of someone skilled in understanding team needs.
- Prioritizing Employee Engagement
Employee engagement is the emotional connection that team members have with their work and the organization. When employees are engaged, they feel connected to the organization’s mission and values, and they are more likely to be motivated, productive, and committed to their work.
You can prioritize employee engagement by providing opportunities for feedback, recognition, and growth. This involves creating a culture of continuous learning and development, where team members can learn new skills, take on new challenges, and receive feedback and recognition for their contributions.
Empathy and understanding also play a vital role in leaders appreciating the different motivations and needs of their team members. Some team members may be motivated by financial incentives, while others may be motivated by the opportunity to learn new skills or take on new challenges. By understanding the different motivations of your team members, you can create engagement strategies that are tailored to the individual needs of each team member.
- Leading by Example
Leadership by example is a powerful tool for building relationships and creating a positive work environment. Leaders who model the behaviours they expect from their team members can create a culture of trust, respect, and accountability.
Leaders need to understand that they are role models for their team members, and whilst this is not a new realisation, it may be one worth refreshing now and again. Focus on demonstrating the behaviours you expect from your team members, such as accountability, transparency, and respect. When leaders model these behaviours, their teams are more likely to follow suit, creating a positive work environment.
Being mindful of your tone and language when communicating with your team, and avoiding the use of language that is condescending, dismissive, or disrespectful is another check worth making every now and again. Leaders who communicate with empathy and respect can create a positive work environment that promotes collaboration and teamwork.
Balancing Profitability and Relationship Building
When trying to juggle the predicament of balancing financial profitability and relationship building within the team, it’s important to note that financial profitability is essential for the success of the business, but it shouldn’t come at the expense of relationship building.
Finding a balance means creating a culture that promotes both by prioritizing employee engagement, investing in activities that allow your team to get to know each other better, communicating effectively, and leading by example.
With empathy, respect, and understanding, leaders can build strong internal relationships while still focusing on strong financial profitability.
Assessing Empathy: Is Empathy A Leadership Strength or Weakness?
By Christen Killick
April 3rd, 2023