The most crucial point in a small business where self analysis of the leader is necessary is during the transition to the professional management stage. The three important elements of people management, planning and the customer are built around the vision, mission statement and values of the company. As the entrepreneur grows the company, the leader must identify his/her need for control, sense of distrust, need for applause and defensive operations, also known as the “darker sides of the entrepreneur".
These characteristics if not monitored or unbeknownst to the leader can result in distorted reasoning and action making the transition (which is necessary for organisational growth) extremely difficult, if not impossible. Due to the leader's inability to recognise his/her destructive behaviours, the organisation may be destined for perpetual smallness or destruction. Needs such as hiring more employees, growing additional branches and hiring managers to oversee teams of employees begin to appear. As a small business earns success and recognition, issues arise.
The entrepreneur generally desires such growth and success and happily appoints managers to continue training and developing and maintaining business relations. If the leader is unable to relinquish control, the managers will be unable to accomplish goals in alignment with the vision and mission of the leader. A large part of providing a successful mission statement is emulating the freedom to accomplish those actions as well as relinquishing control to those the leader hired. Inconsistencies and deficiencies of the leader are well documented factors which limit the growth of entrepreneurial firms. An entrepreneur struggles with issues of authority and control and structure can be stifling. If the leader is unaware of this behaviour, the employees will disengage and eventually leave, which costs the company money in recruiting and training of new employees.
If the control issues are allowed to continue, the leader may attempt to pull back the reins on those he/she hired to manage his/her small organisation's growth. Thus, micro-managing and removing any control or power from the managers themselves. As entrepreneurs sometimes do, planning is done on a gut instinct. The transition to a professional management organisation is no longer based solely on gut instinct. This transits the organisation to rely upon several professionals sharing their knowledge and experience to guide the small business planning. If the entrepreneurial leader is unable to allow this to happen, the transition to a professional management organisation ceases.
This behaviour also affects customers. The integrity and enthusiasm that once existed deteriorates with the controlling, distrusting and defensive characteristics of the entrepreneurial leader. As customers receive lower quality service, unmet expectations and dissatisfied employees, the overall organisational reputation may be lost. The darker side of the entrepreneur negatively affects the small business, the employees and customers. It is vital for a leader to analyse his strengths and weaknesses in order to maintain a successful small business.
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