Grow Your Business Leadership

How to Grow Your Business by Becoming a Better Leader

A key to scalable, sustainable growth is strong leadership, but very few people are born leaders. A key concern for many of my growth-focused clients is leadership development. A question I am often asked is, “How do you energise and motivate the people around you to build the sort of business that will survive in the long-term?”

The fact is, that as you grow your business you also need to grow as a leader. At the recent Growth Summit in Melbourne, John Maxwell, an international leadership expert, gave a fantastic talk about leadership development. Here are the three things I learned about Maxwell’s 5 Levels of Leadership that will help determine your success.

1. Leadership is Influence

The first thing Maxwell explains is that leadership is influence, nothing more, nothing less. By increasing your leadership ability, you are increasing your influence and effectiveness, and this is how you grow your business. Maxwell explains that your leadership ability puts a ‘lid’ on your effectiveness in your business. Therefore, your leadership ability literally determines how much your company will grow.

Maxwell calls this the Law of the Lid and gives the example “if your leadership rates an 8, then your effectiveness can never be greater than a 7. If your leadership is only a 4, then your effectiveness will be no higher than a 3.”

2. Grow your business by growing as a leader

The second point is to remember that leaders develop daily – not in one day. As a business leader, you need to work to develop the skills, attitudes and behaviours of a strong leader. Leadership development takes time, but Maxwell gives us a clear guide to get there with his model of Five Stages of Leadership (see below). 

3. Scale up by growing leaders around you

The third point is that the only way to scale successfully is to not only build your ability as a leader, but to also build your team’s capacity to lead. As you progress through Maxwell’s five stages of leadership, it is as much your own journey of leadership as it is for the people you are leading. Therefore leadership development must become part of your business culture.


Maxwell’s 5 Levels of Leadership Success – What Level Are You?

Level 1 – Position

This is the lowest level of leadership because it does not require ability – anyone can be appointed to a position. It’s a great place to start, but it’s a horrible place to stay. Here, people follow you because they have to, not because they want to. The problem with level 1 is there is no energy and no commitment. Leadership at level 1 will never inspire or motivate action, and a business with a level 1 leader will never be a great business. Three things level 1 leaders do:

  • Rely on rules, regulations, policies and org charts to control people.
  • Team only does what they have to.
  • See staff as subordinates not team members.

Level 2 – Permission

Permission level sees the first real change in leadership effectiveness. At this level, people follow you because they want to. They buy into you because you are influencing people with relationship, not just position. Level 2 leaders are excellent listeners.  Three things level 2 leaders do:

  • Learn what is happening by listening
  • Make an effort to understand each person.
  • Have the same values and vision as your team.

Level 3 – Production

Here people follow you because of what you have done for the business. This level is where you establish credibility. All level 3 leaders are productive individually as well as helping their team to produce. Level  3 leaders do three things:

  • Lead by example.
  • Create momentum.
  • Attract better people to the team.

Level  4 – People Development

People follow you because of what you have done for them. People at level 4 of leadership invest most of their time and energy into growing others as leaders. They spend 20% of their time on personal productivity and 80 % of their time on developing others. This is a significant shift for highly productive people, but the change significantly impacts the long-term success of the business. Three things level 4 leaders do:

  • Recruit very well.
  • Position people correctly.
  • Equip people well to succeed.

Level 5 – Pinnacle

The pinnacle of leadership is level 5. Here people follow you because of who you are and what you represent. Leaders at the pinnacle of leadership create a legacy of strong leadership within the business and it is this quality that ensures the long-term success of the business. They see that by creating a leadership legacy and lifting everyone they are lifting their entire business. Three things level 5 leaders do:

  • Build an outstanding business.
  • Continue to lift up as many leaders as possible.
  • Extend influence to make a positive difference beyond the business and industry.


Whatever stage you are at, growing as a leader is not only essential to your personal development, but the success of your business. A key part of the answer to ‘how to grow a business’ lies in leadership growth.


For more on leadership development take a look at our article Leadership Development Is The Key To Business Growth that lists the two critical questions growth-focused business leaders should ask themselves to unlock business growth.

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  • About the Author, Leigh Paulden

    Leigh Paulden


    Leigh Paulden is an author and internationally certified business growth consultant with over 30 years of experience across 30+ different industries. He works with mid-market business leaders looking to grow. He creates the clarity and certainty needed to make great decisions and achieve scalable and sustainable success.

    Find out more about Leigh or contact him to discuss taking your business growth to the next level.