InPhonic, lead by David Steinberg, was Inc. Magazine’s Fastest Growing Company in 2004. By November 2007, the company filed for Chapter 11 bankruptcy. Steinberg now leads XL Marketing, once again one of the nation’s fastest growing companies. He recently told Inc.’s Leigh Buchanan the five lessons he learned from InPhonic’s collapse. These insights are something all leaders, especially those who have recently experienced failure, can learn from.
- Count What Counts - Steinberg began to focus on profit. At InPhonic, Steinberg sacrificed profit for growth. He now buys only businesses that are profitable or can become profitable very quickly.
- Hire Top People - When InPhonic was a small business, Steinberg could personally oversee the hiring process and guarantee the acquisition of top talent. As the company grew however, he was unable to be involved at the same level and the company’s leadership bench suffered. Now at XL Marketing, they implement an entry-level testing process so difficult less than 10% qualify.
- Upgrade Your Staff - One of the toughest issues church leaders face is when loyal staff have grown the ministry beyond their capacity. Do you keep quality, loyal staff knowing the ministry needs now outpace their ministry skills or do you transition people out whom you deeply love for the good of the ministry and the advancement of the Kingdom? This is a heartbreaking issue most growing churches face. InPhonic faced it as well. They kept their people and suffered badly, particularly in the financial areas. Now Steinberg says he wants an ”expert in what you’re currently doing, not what you were doing two years ago.”
- Keep The Board Small - InPhonic’s board consisted of 12 large personalities such as former Vice Presidential candidate Jack Kemp. XL Marketing’s Board consists of four people, one of which is Steinberg. “I have the contractual right to add two more anytime I want. But I don’t want to do it,” says Steinberg. Small boards streamline decision-making and provide the flexibility needed for fast growth.
- Put Your Family First - Your family are often the only ones who love you unconditionally regardless of your profits, your employees, or the size of your Board. Steinberg averaged 100 hours per week while at InPhonic which obviously had a negative effect on his family. His life is more balanced now and his family is a greater priority.
If you have failed miserably as a leader, there is always hope for redemption. If you count what counts, hire top people, upgrade your current staff, streamline your decision-making processes, and put your family first, you can ensure to previous levels of success.
Pastors and leaders, which one of the five items listed above can you implement today to reverse your negative leadership momentum?
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