When a business owner begins to doubt their own ability to grow their business, they unknowingly start sending signals to their company. Those signals are reflected in the amount of caution that a business owner may carry into meetings or into conversations with managers or even employees.

This Protector Mindset can create havoc if it occurs in the CEO.

Confidence Builds and Supports Change
The owner of a manufacturing company has 29 employees. After growing to this size and being in this very competitive business for just 4 years, this owner is experiencing headaches typical for a company in this stage of its growth curve. Doubt has crept into everything the owner does.

Issues include:
1. The inability of the CEO to release control to key employees creating a sense of distrust among every single person in the company. Which comes first? The CEO not releasing control or mistakes by employees that hurt the viability of the company?

2. No defined values that help drive the behaviors of each person in the company, promoting a lackadaisical attitude among the more experienced employees because they don’t see bad behavior dealt with. The CEO is resorting to micromanaging employees in order to get work done the way the CEO knows is best.

3. Questions about growth go unanswered more than likely because the CEO hasn’t created a vision for the company or felt the need to share it with people if it does exist. Survival is the only thing on this CEOs mind. The ability to think even 6 months ahead has been replaced by a death-grip approach to managing every nickel and dime.

4. Decision making is only done at the CEO level because employees know that their decisions will be belittled, not just questioned, leaving employees thinking that not asking is better than taking a risk in asking. The CEO is frustrated by a seemingly lack of capability by key managers. More and more decisions are based on fear, not the ability to look for opportunity.

5. Experienced employees wanting to step up and take a more active role in helping to run the company receive no encouragement and lack the motivation to pursue their own professional growth because of what is perceived as a lack of trust and willingness on the part of the CEO to let go of authority and responsibility. Lists are drawn up for layoffs. The CEO knows that the biggest savings will be in the larger salaried employees being let go. The protector-like mindset the CEO is carrying is willing to forego experience to save a few dollars.

6. Communication does not exist between the CEO and key staff members. The CEO is very involved in the production day in and day out, there are no regular staff meetings to share information and staff members are left wondering what is expected and even more importantly what they are suppose to be doing. The energy in the company is so low even the most upbeat employees are wondering how the company will survive.

7. The CEO firmly believes that people just need to step up and do their jobs and shows impatience, and in fact, considers it a weakness when people can’t make decisions, ask too many questions and appear to not understand what is expected of them. Chances are good that the CEO will opt to simply shut the doors because the headaches are just too big and the rewards too few. The risk adverse attitude taken because of a downturn in business has taken its toll on another organization.

The ability of a CEO to understand a little-known phenomenon called the Builder/Protector Ratio would have helped this CEO and the company to weather this downturn. By simply understanding that there is a Protector Mindset and a Builder Mindset and that CEOs must be more Builder-like than Protector-like is what is called a Hidden Agent. And understanding these hidden agents can help a CEO adjust their behavior to avoid a disaster.

The Builder/Protector Ratio
This phenomenon called the Builder/Protector Ratio (B/P Ratio) is a measurement within a company of confidence vs. caution. It’s a critical measurement tool for a CEO and their leadership team to be able to assess the company’s ability to accept change, react with confidence to that change and help the company achieve its stated goals.

A Builder mindset creates new ideas, takes on new initiatives, and finds ways to expand the revenue and profitability of the enterprise. A Builder chooses to challenge and improve the way things are done. They are risk tolerant and highly supportive of growth. A Builder tends to be confident in the financial strength of a company and hold a high degree of confidence in the company’s processes and systems.

A Protector mindset is cautious and prefers to slow down the pace of change. They are risk adverse and highly suspicious of growth. Protectors may not feel confident in the company’s financial strength and are slow to embrace the optimism of the future.

The CEO of this small manufacturing company is unknowingly creating a company of Protectors because of his need to control and his hesitation to bring his employees into the vision and strategic plans for the company.

His controlling nature has virtually shut down the Builder-like capability in every single employee. By not encouraging communication, the Builders in the company will not step up and take risks and will revert to Protector status quickly.

By not sharing with the employees any information about the company’s future plans or their current financial situation, the employees will always come from a Protector mindset, which can be interpreted by the CEO as an unwillingness to step up and get the job done.

A company that had huge potential for growth will suddenly find itself with a culture of resistance, high staff turnover and life for the CEO will become almost unbearable.

Determining Your Company’s Builder/Protector Ratio
There are specific signs happening today in your company that will immediately let you know how balanced your Builder/Protector Ratio is. A leader can get a good idea of their company’s B/P Ratio by 1) tuning into the voltage (think energy) in your company 2) talking to your leadership team and asking some pointed questions and 3) listening to your employees, really listening.

What are the signs? Are people engaged in open and active dialogue? Are meetings productive, full of valuable information? Are good decisions being made?

What are the questions? Does your leadership team or your employees appear optimistic about the future? Are they confident in the financial strength of the company? Do they have a high level of confidence in their co-workers?

What are your employees saying? Is there too much behind the scenes gossiping? Is there a high rate of absenteeism or turnover? Do your managers or employees complain about a lack of accountability? Are projects derailed or slowed down too often?

Creating a Builder Mindset
A leader can help create more of a Builder mindset in their company by doing one thing and doing it often. Communicate. Communicate where the company is going. Communicate why it is going there. Communicate what the goals of the company are today and for the future. Communicate to individuals daily. Get to know each employee. Share critical information all the time and do it often.

Confidence vs Caution
If a company is aware of its B/P Ratio it can 1) make good decisions in a timely manner 2) accept change as a part of the company’s culture and 3) engage employees in meaningful dialogue because they have helped design the strategic future of the company.

Remember, a confident company is a profitable company.