Why your role as a leader is crucial to business growth

In this column, based on a webinar he delivered for the UK Government’s Business Academy, Mark Hart, Deputy Director of the Enterprise Research Centre and Professor of Entrepreneurship and Enterprise Policy at Warwick Business School, outlines the key leadership qualities that help businesses to grow.  

After studying the issues surrounding business growth for more than 30 years, it is clear that in the UK, we are currently in a period of marked decline. 
 
Working closely with businesses, policymakers and researchers, and tracking the performance of the UK private sector, we can see that, in the last decade, the number of businesses that are growing has fallen significantly. 

This is not simply the result of big economic and social events like the COVID-19 pandemic or Brexit, more of a general malaise in the private sector. 

Which has led me to ask the question, ‘What are leaders doing? And how can we help them break this cycle of low growth in the economy?’  

The answer? We need to be looking more closely at ourselves and the way we lead and run our businesses. 

Our work at the Enterprise Research Centre consistently shows a strong positive relationship between leadership capability, management practices and business performance. Understanding what kind of leader you are, and what you can do to develop your leadership skills, is a crucial first step in boosting the growth of your business, helping you focus on the type of environment and team you want to create. 

So, how do we develop leaders who can take their businesses forward in this way? Together with fellow business expert Simon Raby, Professor of Innovation and Entrepreneurship at Mount Royal University in Calgary, Canada, I developed what we call the CORE Framework. It captures four capabilities that are central to effective entrepreneurial leadership. 

• Cognitive capability is how you think as a leader. It starts with foresight: your ability to see opportunities, anticipate change and understand what may be coming down the track. It also involves critical reflection. How do you assess the decisions you make? How do you define yourself as a leader, both inside and outside the business?  

• Organisational adaptability focuses on how your business is structured and how it learns. Is it still built around rigid, transactional ways of working, or does it encourage experimentation and continuous improvement? Does learning always come through you, or do you empower others to bring new ideas into the organisation? Culture matters here just as much as strategy. 

• Relational connectivity is about networks. Not just internal relationships, but connections beyond the business as well. Mentoring, coaching, and peer networks are among the most powerful – and undervalued – sources of leadership development. The real benefit of programmes like Help to Grow: Management lies in the trusted relationships they create, where leaders can share challenges and opportunities openly. Productive networks challenge and support you. Review your networking to see if you’re in the right groups or just attending things out of habit. 

• Emotional resilience underpins everything else. Leadership is emotionally demanding. Constant disruption, uncertainty and pressure can drain energy and confidence. Resilient leaders understand how they feel, recognise when they are under strain and take steps to look after their own wellbeing.  

Leadership capability only translates into growth when it is embedded across the organisation. High-performing teams are a crucial part of this. There is a strong and consistent relationship between effective people management, employee engagement and business performance – not just in terms of turnover and jobs, but productivity and profitability as well. 

So how do you get employees invested in what you’re seeking to do as a visionary, entrepreneurial leader in your business? 

There are four key enablers of employee engagement: 

• A clear strategic narrative. People need to understand what the business is trying to achieve, where it is going and how it plans to get there. This narrative must be consistent and reinforced through everyday actions and excellent communication. 

• Engaging managers. Managers play a critical role in translating strategy into action. They must understand the strategic narrative themselves and help their teams see how individual objectives contribute to it.  

• Employee voice. High-performing organisations listen carefully to their employees and take their feedback seriously. Employees often see problems and opportunities long before senior leaders do, and ignoring this leads to them feeling disconnected. Creating effective channels for dialogue and improvement is essential. 

• Organisational integrity. Values must be lived, not just stated. Consistency, fairness and value-led behaviour at all levels build trust and commitment. When people believe in the organisation, feel respected and see opportunities to grow, they want to stay and perform at their best. 
   

In summary, being an entrepreneurial leader is not about doing everything yourself. It is about surrounding yourself with the right people and creating the space to think strategically.  

Finding the space to step back from day-to-day operations is difficult, but it is vital if you want to continue to grow your business. 

You do not need to enrol on a formal programme like Help to Grow: Management to do this, but many people find them helpful particularly for this reason. The dedicated time to think, combined with the peer mentoring aspects of these courses, can be the catalysts for real change.   

To find out more about Help to Grow: Management click here. 

Find out more about the Enterprise Research Centre here.