Why small business leaders need a peer group more than anyone else

Small business leaders are a rare and special breed because so often they start by having an idea that they believe will create value.

They are entrepreneurs who can demonstrate creativity and resilience in the face of challenges. They are driven to persist, while adapting and taking risks to meet new opportunities.

The businesses these people are running are usually in an area where they have great experience or interest. As the company grows, challenges erupt in areas outside of that expertise, but these passionate entrepreneurs don’t have specialists on their payroll in those other areas of business. For example, the president of a small IT company may not have the necessary expertise in marketing, human resources, or finance.

These leaders have chosen demanding roles, which include long hours, wearing multiple hats, enormous responsibility, and difficult decision-making — all the while feeling that they need to maintain an impenetrable facade. Here’s what happens:

• They begin to doubt themselves and become afraid of being exposed as a fraud, despite the success they’ve accomplished.

• Over time, the pressure of their roles can cause them to doubt their abilities.

• They become physically, mentally, and emotionally exhausted.

Small businesses with limited resources and personnel are challenged by growth that inevitably strains operations and compromises quality.

They have to fight to compete with larger organizations due to lower economies of scale that creates diminished profit margins and no room for error.

It’s difficult to keep up with technology and identify the right choices to adopt for their company’s specific needs.

Money management can be a struggle due to lack of expertise or inadequate planning.

Small business leaders can get mired in the day-to-day operation of the business, limiting their focus on strategic planning and growth opportunities.

The pressure these entrepreneurs place on themselves to succeed along with long hours and limited resources blurs the boundaries between work and personal life. The result can be business stagnation, personal burnout, and strained relationships.

A professionally run peer group that stresses confidentiality can be transformational for small business leaders.

• It provides the opportunity to speak honestly and openly about the challenges of running a small business with others who intimately understand.

• Experience and resources shared to help members make solid choices and engage with trusted advisers.

• Time created to work on the business instead of in it underscores the value of a leader’s time.

• Brainstorming and idea sharing provides broad perspective enabling conversant decision-making.

• Opportunity to be educated in areas outside of one’s own expertise makes stronger and more capable leaders.

Running a small business is daunting, but entrepreneurs do it because they are driven, passionate, strong-willed, and able to tolerate risk.

In a well-run peer group, they get honest, reality-based advice about the business because the members have gone through it, unlike an investment firm or banking adviser who has never run a business (although that counsel has its place.)

Much of the pressure and fear can be mitigated by working with a group of colleagues who understand the fatigue, failures, and most of all the triumphs that come along with small business leadership.

• Lori Dann is CEO of the Presidents’ Leadership Council.