What makes an effective Leader?

What makes an effective Leader?

Being an effective business leader is a demanding role. It requires a business owner to direct, manage and balance every aspect of his growing business while earning the respect and loyalty of all people involved.

In this article, I discuss the key qualities and values that make an effective leader.

Lead with Passion

Effective Leaders are passionate about what they do, and they’re not afraid to show it. When they demonstrate to their team that they love and believe in what they’re doing, their team will too.


Jim Collins author of the book ‘Good to Great’, found that great leaders have humility, in other words they don’t seek success for their own glory; rather, they seek success so the team and company can continue to thrive. They also share credit for company success with their employees and not just at Christmas, after all, business success is a team effort. Conversely, they accept responsibility for company mistakes rather than blaming team members.


An effective business leader has a clear view of his business for the future and communicates it with his team. He ensures that everyone in his team supports the company vision and wants to work together to make the vision a reality.

Business Planning/ Goals

Good leaders create a plan for every area of their business – sales, marketing, project management, team development, financial, finding key labour and so on. Short-term and medium-term goals are created so everyone has benchmarks and targets to work towards.

A good leader is proactive not reactive and identifies potential problems and creates steps to prevent them from happening or if they do, solves them quickly before they escalate.


Effective leaders learn how to make sound decisions, quickly. Making a sound decision quickly involves: Define the decision, create a decision deadline, list all the strong options, list the pros and cons for each one, imagine the outcome for each option, share the options with a key person and get their opinion, check with his gut, if he has time will sleep on it before deciding, then make the decision based on all the information collected.

Inspire by example

Leadership is defined through action, therefore a strong leader will act in ways that are aligned with his personal and company values and the consistent message he is always delivering. So he leads by example and displays his values through his actions.

Effective Communicator

An effective leader knows when to talk and when to listen. He can clearly and succinctly explain to his employees everything from goals to how to do something. If employees don’t understand what he means, he explains it again in a different way and checks to see if they got it. An effective leader takes time to understand how he needs to communicate with each employee, client, alliance and supplier, knowing full well that building strong relationships is key to business longevity and success.

Team Building

An effective leader knows his team is his greatest asset, therefore he creates an environment that allows employees to learn, grow and increase confidence so they can reach their potential. His key employees will get to know and understand each team member under their management, by knowing what motivates them, how to help them overcome their weaknesses and how to inspire them.

Firm but fair

Effective leaders are firm but fair when communicating directives, goals and expectations. They present employees with documented standards, behavioural rules and a job description they are expected to follow. Weekly meetings are conducted with key employees and a report with important targets and objectives become habitual. Employees respect firm but fair leaders much more than an easy going softer approach.

Managing in a changing environment

Leaders must be problem solvers who can make decisions under shifting circumstances. Leading in a sometimes complex and changing environment is a vital skill. An effective leader must assess a situation and make the right decision that will best suit their clients and business. Sometimes they will get this wrong and learn a valuable lesson. Being a leader is about managing change while striking a balance between stability and growth.


Strong business leaders self-reflect regularly. No-one is evaluating or giving them feedback on their performance, so they know it’s up to them to self-reflect every week. It only takes 10 mins to look at their key actions and assess what worked, what did not and where they could improve.

There is no single characteristic, value or quality that defines an effective leader but a combination of many. Giving attention to improving your leadership skills will pay huge dividends to your future business success.

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