6 Key Leadership Skills That All Entrepreneurs Need to Develop by 2023

As an entrepreneur, leadership skills are essential at any stage of your business. As your business grows and changes, so too must your leadership skills.

Every month, a lot of small enterprises are founded, but a substantial percentage of them fail. According to the "Survival of Private Sector Establishments by Opening Year" report from the Bureau of Labor Statistics, by 2021, 50% of failures took place within five years, 65% within ten, and 20% occurred within the first year.

Businesses fail for many reasons, but poor leadership is often a contributing factor. Poorly led businesses tend to make bad decisions, resulting in financial losses and decreased morale.

In order to avoid these problems, it's important to develop strong leadership skills. Here are six leadership qualities that every entrepreneur should possess by 2022:

Leadership Skill # One: Effective delegation skills.

A Gallup study found that CEOs who are good at delegating increase revenue by 33%. As your business grows, you will likely find yourself with more responsibility and less time to focus on the tasks that you are good at, due to embarking on the new path towards becoming a great leader with your own team to run.

Delegation allows you to focus on the most important tasks and goals while also empowering others to take on responsibility and ownership of their work. It can also help to develop the skills of your team members. Lastly,
consider enabling sales teams with AI, which can automate routine tasks
and provide valuable insights to further boost productivity.

When delegating, it is important to be clear about what needs to be done and who is responsible for doing it. You should also provide adequate support and resources and set deadlines.

Leadership Skill # Two: The ability to think strategically.

Hubert Miles, CEO of Home Inspection Insider states that as an entrepreneur, you need to be able to think strategically about your business. This means identifying opportunities and threats and developing plans to take advantage of opportunities while mitigating risks. Strategic thinking requires both creative thinking and analytical skills.

Aside from learning from experience, one of the best ways to develop your strategic thinking skills is to read business books and articles, attend industry events, and talk to other business leaders. Several online strategic thinking courses can help you develop this important skill.

Leadership Skill # Three: The Power to motivate and be an example to others

Being able to inspire and motivate your team is a skill that a leader must possess. Setting clear objectives, fostering a healthy work atmosphere, and rewarding employees with unique corporate holiday giving who go above and beyond expectations are examples of how to do this.

True leadership doesn't mean you make your people do all the work for you, but you are at the front to encourage and set an example, said Dawood Khan, the CEO, and co-founder of Pixelied. "I think entrepreneurs must first learn to live what they teach their employees and start there to make a difference," Khan added.

To have this power, you don't need to be the loudest person in the room to get your point across. Leaders show they can be trusted by being consistent and honest with their words and actions. When your team knows that you're a reliable force, they'll be more likely to put their faith in you and follow your lead. One of the Chefs at Gourmaze adds "Being a head chef, you must give the best example possible, as everyone is looking up to you, and it's the same in any other business.

Leadership Skill # Four: Cultivate an adaptive and agile mindset

Shah Aktaruzzaman, CEO Sneaker states the ability to adapt is another important leadership quality. This means being able to change your plans and strategies in response to changes in the marketplace or your industry. It also means being open to new ideas and willing to experiment.

For example, when the COVID-19 pandemic hit, many businesses had to adapt their plans and strategies quickly. Some businesses had to temporarily close their doors, while others had to pivot to a new business model. Adaptability is essential for any leader who wants to succeed in today's ever-changing world.

We can see an outstanding example of agility from Elon Musk, the founder and CEO of Tesla. In early 2020, when the COVID-19 pandemic caused a decrease in demand for cars, Musk quickly adapted by pivoting to the production of ventilators and other medical equipment. This quick thinking and adaptability are what have made Tesla one of the most successful companies in the world.

Leadership Skill # Five: The knack for financial management

According to a U.S. Bank study by Jessie Hagan, 82% of business failures are caused by poor cash management. This is not surprising when you consider that most businesses have to deal with a lot of financial uncertainty. As a leader, you need to be able to make decisions that will ensure the financial stability of your business. This means being able to create and stick to a budget, as well as understanding and managing cash flow. Additionally, consider incorporating professional OIG checks to protect your business from risks and ensure compliance with regulations.

For instance, during recessionary periods, businesses like PCBPit need to be extra careful with their cash flow. This might mean cutting costs in order to free up cash for essential expenses. It's also important to have a good understanding of your business's finances to make informed decisions about where to allocate resources.

Leadership skill in financial management involves understanding the importance of proper structuring and risk management for personal and business assets. By choosing the right business structure like an LLC, maintaining the corporate veil, avoiding personal guarantees, and securing adequate insurance coverage, leaders can minimize the potential impact of business failures on personal assets. This includes understanding LLC tax classification, which can significantly influence financial strategies and tax liabilities. Offering robust enterprise software development services is also crucial for supporting business operations and growth.

To further support your business structure, consider taking the initiative to generate a free LLC Operating Agreement, ensuring clarity and legal protection for your enterprise.

It is essential to consult with legal and financial professionals to ensure compliance with the laws and regulations specific to your state. For instance, California LLC would have different laws and regulations than Pennsylvania LLC.

Leadership Skill # Six: The capacity to sell.

The capacity to sell is another important leadership quality. This means being able to convince others to buy your product or service. It also means being able to effectively market and promote your business.

As the late Steve Jobs once said, "Marketing is about values. It's a complicated and noisy world, and we're not going to get a chance to get people to remember much about us. No company is. So we have to be really clear about what we want them to know about us."

This quote highlights the importance of clearly communicating your value proposition to potential customers. If you can't sell your product or service, you won't be able to stay in business for very long.

Fortunately, there are a number of online resources available to help you improve your selling skills. There are also many books and articles that can provide valuable insights into effective selling techniques.

There you have it, six essential leadership skills that every entrepreneur needs to be successful. While there are many other qualities that can contribute to success, these six are a good place to start. So if you're looking to improve your leadership skills, be sure to focus on these key areas.

And remember, the most successful entrepreneurs are constantly learning and growing. So, don't be afraid to continue developing your skills and knowledge.