Before we hop on to discuss what a Level 5 leader is, humor me by answering a question first. What makes a great leader? Is it any of the following?
- Courage to face adversity
- Business acumen and knowledge
- Unrivaled expertise
- Organizational skills
- Charisma and leadership
Perhaps you answered, “all of the above”. After all, great leaders come wrapped with varying blends of skills and personalities. But Level 5 leaders? They pack something much more important.
Level 5 Leadership was introduced by Jim Collins in his book, “Good to Great.” In it, he says good-to-great leaders are cut from the same cloth, regardless of their backgrounds, upbringing and industry.
Through the course of Jim’s five-year research for the book, he found an interesting pattern. All companies that transformed from good to great had a Level 5 leader at the time of transition. Furthermore, the presence or absence of Level 5 leadership dictated the success or failure of companies in embracing radical change.
In other words, being a Level 5 leader entails something more than being just a leader. If you’re in a position of leadership, you probably wondered how to take your leadership to the next stage. I’ll teach you how as we examine Level 5 leadership and explore the elements surrounding this concept. Keep reading.
Jim Collins’ Level 5 Leadership
The idea of Level 5 Leadership was coined by the thought leader in radical change, author and speaker, Jim Collins. He first described the term in his book “Good to Great.” According to Collins, a Level 5 leader have all the best leadership characteristics you can think of.
Level 5 leaders don’t fixate on their own egos or achievements. Instead, they prioritize the success and growth of their company above all else, despite adversities. They may be ambitious, but their dreams go beyond themselves and involve the entire enterprise. A Level 5 Leader is willing to call the tough shots if it meant fostering radical change in their organization.
On top of all those, they also possess a strong combination of two important things, which we’ll discuss later.
So, how can a residential home service business owner like you become a Level 5 leader in your own company? We’ll get to that later. The cornerstone of it is embracing the core elements of Jim Collins’ Level 5 leadership. You have two options:
- Read all of Jim Collins’ books and master his principles religiously
- Work with Wizard of Sales® to train your team to become Level 5 leaders
By tailoring Collins’ concepts to your specific situation, I can help instill Level 5 leadership into your company. All it takes is booking a free call and let’s talk about how it will work.
The Concept of Level 5 Leadership
How did Jim Collins come up with the concept of Level 5 leadership? Here’s a quick background. As part of his research for “Good to Great,” Jim screened 1,435 companies and found 11 truly great ones. Each of the 11 winning businesses was headed by a Level 5 leader.
As the term “level” suggests, there are different stages of leadership. Being classified as a leader from any of the five levels is already a commendable feat in itself.
Do note that leadership is not necessarily a title.
Leadership is personal branding you hold when there are people looking up to you. When your leadership and rank go hand-in-hand, it demonstrates that upper management knew you were worthy of the position.
Among them, however, the Level 5 leader is the pinnacle of success and effectiveness in leading a company to greatness. Wherever you are on the list, you must always strive to reach your full potential. Being in a more advanced position means that you’ve acquired the qualities in the preceding levels.
Try and assess where you think you are among the stages. Here are Jim Collins’ five levels of leadership:
Level 1: The Highly Capable Individual
The level 1 leader is the talented, knowledgeable and skilled worker in your team. These qualities make them effective in the workplace as they perform well and consistently deliver results. In this category, being a leader is attributed to one’s capability of bringing contributions to the company. You’re a leader in your field, in a sense.
The only pitfall of Level 1 leaders is they are independent. They look after themselves and their performance, without a larger team-wide purpose or goal. Another is that these leaders also lack the ability to inspire and motivate others. This translates to poor skills in delegating tasks, team building, and communication.
Level 2: The Contributing Team Member
The Level 2 leader takes the talent and skills from the previous one and makes up for what they lack. Contributing team members means that they are also skilled and talented, but more than that, team players. They work well with other members and are proficient in helping their team reach its goals and objectives.
In other words, you use your knowledge and skills, not only for yourself but for the team surrounding you. That means working in conjunction and complementarily with others in the group.
Level 3: The Competent Manager
Being a Level 3 leader is when your leadership skills converge with your position. Upper management finally grants you the rank that goes with being a leader.
These leaders are competent managers who are able to effectively handle tasks and delegate them accordingly. Having a clear understanding and grasp of the company’s goals is a requirement at this stage. Competent managers are effective at overseeing people and allocating company resources toward goal-achieving endeavors.
They also know how to motivate their team members. This creates an environment where members feel valued and contribute towards the company’s vision.
Level 4: The Effective Leader
As a business owner, your goal is to step up beyond being a competent manager and actually lead the company. Most top leaders fall into the effective leader category, and rightfully so.
Effective leaders are like captains that steer the ship to safety across violent straits. In the same way, they know how to inspire and guide their team to achieve company goals. For this reason, keeping organizations functioning at the highest level is possible.
One key quality of Level 4 leaders galvanizing or exciting departments or organizations to meet, if not exceed performance objectives. However, they’re still not at the tip of the iceberg.
Level 5: The Executive (Great Leader)
A Level 5 leader is layers-different from a Level 4 leader, but not in any way you think. Of course, being a Level 5 leader entails having all the abilities mentioned in the four preceding levels. This means having all quality-and-characteristic gauges from previous levels at full capacity.
Despite having all those traits, two qualities set a Level 5 leader apart:
- Personal humility
- Indomitable will
Jim Collin calls these traits a “paradoxical combination.” Perhaps because it’s not often we see leaders who are both humble and unwaveringly determined to succeed. However, this combination of characteristics allows level 5 leaders to create lasting results.
Being humble means level 5 leaders are able to take the blame for failures and give credit where it’s due. It also means having the ability to transcend ego and confidently delegate tasks to those who are better at it.
Indomitable will, on the other hand, means level 5 leaders never settle for mediocrity and are constantly pushing toward improvement.
What Separates the Level 5 Leader From the Rest?
Jim Collins suggested that mastering Level 5 leadership means understanding the following elements and implementing them effectively:
First Who, Then What
A Level 5 leader embraces the idea of First Who, Then What. This means that leaders prioritize assembling a strong team first before focusing on pursuing a vision or strategy for success. They know they cannot achieve great things alone. That’s why they surround themselves with remarkable individuals who can share the burden of pressing toward radical change.
The Stockdale Paradox says:
“You must never confuse faith that you will prevail in the end– which you can never afford to lose. Use this with the discipline to confront the most brutal facts of your current reality, whatever they might be.”— James Stockdale
This quote means that a Level 5 leader has two things:
- An unwavering belief in the ultimate success of their company
- The ability to face challenges head-on without denying or avoiding them.
They are able to acknowledge and address challenges and failures while remaining optimistic about their company’s future.
Creating the Flywheel Effect
Creating unstoppable momentum is a key component in Level 5 Leadership. The Flywheel Effect suggests that small, consistent actions over time can build up to create a powerful systemic change.
Leaders don’t stop pressing toward a goal unless the desired radical change is realized and normalized. They create momentum by being a part of the change and influencing their Realm of Association to be involved too.
The Hedgehog Concept is derived from a Greek parable comparing foxes and hedgehogs. Foxes know a little about so many things while hedgehogs know a lot about one thing. Jim Collins says that businesses that adopt a hedgehog characteristic are those that achieve greatness. Hedgehog leaders understand three things:
- What a company is best at
- How to effectively use its economics
- What drives its people’s passions
Focusing on these factors eliminates unnecessary and non-money-generating endeavors.
Culture of Discipline
Discipline is not a negative word. A Level 5 leader is able to create and nurture a culture of discipline within their company. This involves setting high standards, enforcing accountability, and teaching employees to be self-disciplined.
Level 5 leadership asks people to be disciplined on three fronts: people, thought, and action. With discipline, you eliminate the need for hierarchy and bureaucracy while promoting remarkable performance in the workplace.
The Path to Great Leadership
Your goal as a business owner is to become a Level 5 leader. It won’t be an easy ride. But it will certainly be worth it if you want to take your business from good to great. The path to great leadership takes time. Acquiring the necessary skills and mastering all nit-bits that make a great will take months if not years.
But what if there was a way to hasten the process? You could through our help.
Wizard of Sales® has been part of honing residential home service business owners on how to become Level 5 leaders. Our program teaches you everything there is to know about Level 5 leadership. Plus, we tailor our training to your specific circumstance to help apply it to your company right away.
Take control of your company’s future by becoming a Level 5 leader. Book a call with us and let’s get that leadership on a platter.