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‘The Profit’ an Example of How Poor Leadership Can Ruin a Business

by yak max

I recently caught up on the first season of The Profit, a reality-based TV show where billionaire entrepreneur Marcus Lemonis offers to invest in struggling small businesses to help them turn a profit. The show offers high drama among lessons in business. There is a common theme in the first season which mirrors what I often see in business- poor leadership leads to poor performance. Marcus talks about his three Ps (people, process, and products). When things go sour in the show, it always has to do with the people, specifically the ones in charge. One episode featured an owner who was too controlling, micro-managing his head of marketing. Another owner was too lackadaisical, even disinterested in leading the business he inherited from his father. This CEO couldn’t be bothered to stay for the entire grand reopening event at his flower shop. Another CEO displayed questionable ethics; she tried to undercut Marcus on a deal involving her domain name, and didn’t appear to be shocked when alerted that $400,000 in cash was missing from her company.

When conducting leadership and management training I often like to remind participants that “a fish rots from the head.” Simply put, when things go bad in a company, the problem usually starts from the top. What I have seen so far on The Profit supports this; CEOs featured were directly responsible for the shortcomings of their companies.

The Profit episode I found most astonishing featured LA Dogworks, an upscale dog grooming, boarding, and training facility in southern California. Founder and owner Andrew Rosenthal spends the entire episode contradicting one of my biggest beliefs in business – employees are each company’s greatest asset. He constantly disrespects his employees, both behind their backs and to their faces. He considers his employees to be as disposable as the plastic bags used to pick up after his dogs, telling Marcus he could fire all of his employees and start over. Mr. Rosenthal is what I refer to as a MINO – manager in name only. He doesn’t know the first thing about how to deal with the people he manages. I suggest Mr. Rosenthal take a page from my book Sit Stay Succeed and start treating his employees like the dogs he grooms and boards.

In the business world, individuals sometimes get promoted to management positions on the basis of excelling at their previous job within the company. Excelling at your job is a good thing. Unfortunately, the skills required to successfully perform a job are not necessarily the skills needed to manage other people to top performance. There has always been a debate on whether great leaders are born or made. I think it’s a combination of both. Leaders need to possess skills and characteristics to be successful. Characteristics like integrity, compassion, and strong vision make people who they are. A person lacking a value system can’t be trained to be ethical. Skills such as being able to delegate, communicate, and create a plan are learned and developed throughout an individual’s career. A combination of skills and characteristics are vital to be a great leader. Someone with strong vision must learn how to create and execute a plan in order to be successful.

In one episode of The Profit, the CEO for a popcorn company repeatedly told Marcus her company generates $2.5 million in revenue each year as proof of her success. Unfortunately, her $2.5 million in revenue generated zero profit. The business class I took in school taught me companies need to be profitable to stay in business. This CEO lacked basic business acumen, a necessary skill. She was being stubborn, shortsighted, and nonchalant, a few characteristics not generally sought after in highly effective leaders.

Regardless if you are a seasoned, new, or aspiring business leader, you can always expand your knowledge in technical and soft skills. Become a leader that inspires, convinces, and persuades employees to achieve their goals. Acknowledge if there is a problem with your company, someone may be the culprit, and that person maybe the one in the mirror.

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