Here's something we probably don't think about often enough:

Great companies grow one person at a time.

The simple fact is, without individual growth, organizational growth is almost impossible. But if your people ARE growing, that sets the stage for every other kind of good growth. Processes improve. Capabilities expand. Innovation increases. If your people are growing, that's good growth.

We have all manner of financial metrics, as well we should. But most companies don't have a clue whether their people are growing. When we think about growth we think about the top line or the bottom line or debt to equity or whatever. And all of those are important. But the best way to improve any or all of those important measures is to help our people grow.

This is a ridiculous example, but still. If the American League MLB All-Stars were going to play a game against the best high school baseball team in America, which team do you think would win?

Bet on the team with the best players. They don't always win, but that's where the smart money goes. That's why good growth always involves improving the knowledge and skill of your team.

Two American favorites, Growth and Beer. But some months ago, when I heard InBev was buying Bud, I just shook my head. For God's sake, how big is big enough? More to the point, is it good business? Bill Taylor (co-author, Mavericks at Work and great blogger) has some thoughts on this kind of thing:

"When will big-company CEOs ever learn that using acquisitions to get bigger almost never makes their companies better? ... There's nothing wrong with these acquisition-driven behemoths other than the fact that talented people don't want to work for them (the politics and bureaucracy are paralyzing), customers hate doing business with them (they lose any sort of human touch), and investors don't trust them (which is why the stock price of the acquirer almost always drops on news of a deal)."

I wish I would have said that. Neither growth nor size make a company the best, the most profitable, the most innovative, or the most anything-you-probably-aspire-to.

Growth (the good kind) is necessary. And it is a critical deliverable of great leadership. But it is way harder than simply making acquisitions or increasing sales. We'll talk more about this in future posts.

In the mid-sixties Grace Slick wrote a song entitled, White Rabbit. The song opened with these lyrics:

One pill makes you larger

And one pill makes you small

It occurs to me that much the same is true with growth. Some growth makes you larger and some growth makes you small. I'll use the the casual dining segment as an example.

Virtually every major company in the category has chased growth incessantly, building more and more stores. That "worked" for awhile. But even before the current economic meltdown there were serious signs that things were unraveling. Same stores sales in decline, locations being shuttered. In some cases, stores and companies actually losing money. I'd say that's growth that makes you small.

And it wasn't just the restaurant business. The same pattern was repeated in almost every industry. The assumption was all growth was good growth and that is simply not true.

Good growth makes a company stronger. Bad growth makes the company weaker (even if sales are headed north). Good growth builds people up. Bad growth tears people down. Good growth makes the future brighter. Bad growth endangers the future. Good growth attracts the right kind of people. Bad growth repels the best people.

Hindsight is 20/20, I get that. But let's learn something from this. Let's make sure we understand the difference between good growth and bad growth.

For most of the 70s, 80s and 90s, the prevailing business platitude was:

People Are Our Greatest Asset.

Thankfully, Jim Collins disabused us of that notion in Good to Great. Or perhaps more precisely, he refined the platitude so it was, in fact, true. He taught us:

The RIGHT People Are Our Greatest Asset.

There's a corollary regarding growth. For most of the last couple of decades, the obsession of most boards and businesses has been growth. That obsession is partly (sometimes mostly) to blame for the mess so many companies find themselves in. I'd suggest we refine our objectives (obsessions) as follows:

The RIGHT Growth is Our Number One Objective.

I can hear the wails from here, "But we HAVE been focused on the RIGHT growth." Not so much. Stay tuned.

Try this: Make a list of the five or 10 people you care most about. If your list has only family members, expand the list to 15 or 20.

If you're like most people, your list will have some family members, personal friends, people you met at work, folks from your church or a support group, members of your softball team or book club, a teacher, a coach, a mentor. But chances are, the people in this group have only one thing in common:

Every one of them cares about you.

It seems to be a law of nature. We care about people who care about us. We engage with people who care about us. And that can have powerful benefits. According to research reported in the book, First, Break All the Rules, when people feel cared for at work:

Productivity Goes Up

Profitability Goes Up

Customer Satisfaction Goes Up

Turnover Goes Down

All of that happens because when employees feel cared for, they're engaged. When your people are possessed of a genuine, unshakable belief that their well-being and success are among your primary concerns, engagement explodes.

Here's a simple scenario: A leader exudes optimism. That optimism sparks an employee's hope. The employee's hope fuels his/her engagement.

Without hope, there can be little engagement. It's hope that motivates people to willingly commit their hearts and minds and sweat to achieving the company's goals – in other words, to be engaged. Hope creates the belief that tomorrow will be better than today. When people have hope, they face the future with enthusiasm.

The Gallup Organization asked thousands of employees whether their company's leadership made them "feel enthusiastic about the future." The dramatic results were reported in the book, Strengths Based Leadership:

"Sixty-nine percent of employees who strongly agreed with this statement were engaged in their jobs, compared to a mere 1% of employees who disagreed or strongly disagreed."

In a company with 100 employees where the leader expresses optimism and creates hope, there will be 69 engaged employees – 69 people who have a profound emotional commitment to organizational success. In a company with 100 employees where the leader fails to express optimism and create hope, there will be one lonely employee who has a commitment to organizational success. 69 to 1. It's not a fair fight.

What happens when someone lies to you? How does that make you feel about the liar? Most of us feel betrayed, angry, deeply disappointed &ndash sometimes even depressed. What we definitely don't feel is positive energy and engagement.

For almost thirty years, James Kouzes and Barry Posner have been conducting research about the qualities people most look for in a leader they would willingly follow. That research has consistently revealed four qualities: Honest, Forward Looking, Competent, Inspiring. But in almost every survey, honesty has been selected more often than any leadership characteristic. From the landmark book, The Leadership Challenge:

"It's clear that if people anywhere are to willingly follow someone – whether it be into battle or into the boardroom, the front office or the front lines &ndash they first want to assure themselves that the person is worthy of their trust."

Honesty is THE do or die requirement for building employee engagement. There is no wiggle room – you must always do what you say you will do. And just as importantly, your deeds must be consistent with your words. You can't profess to care about employees and then treat them with disdain. You can't list customer service as the top priority and then criticize customer service staff because their average call time is too long.

Again, this just makes perfect sense. And again, there is research to support the concept. In one national Gallup poll, the chances of employees being engaged at work when they don't trust the company's leaders are just 1 in 12. But when employees do trust the company's leaders, the chances of employees being engaged shoot up to 1 in 2. It's just this simple: If you're not completely honest, you won't have engaged employees.

Here's the thing about humans: Most of us like to do what we're good at. So, if we get a chance to do what we're good at a lot of the time at work, we're into it – we're engaged. In their book, Strengths Based Leadership, Tom Rath and Barry Conchie said it this way:

"In the workplace, when an organization's leadership fails to focus individuals' strengths, the odds of an employee being engaged are a dismal 1 in 11 (9%). But when an organization's leadership focuses on the strengths of its employees, the odds soar to almost 3 in 4 (73%). So, that means when leaders focus on and invest in their employees' strengths, the odds of each person being engaged goes up eightfold."

When people have an opportunity to do what they do best, they progress faster and they achieve more. That just makes sense, but there's also research to support the idea. From a recent study at the Harvard Business School, Professors Teresa Amabile and Steven Kramer drew this conclusion:

“People have their best days and do their best work when they're allowed to make progress."

And this is not a new phenomena. In the January, 1968 issue of Harvard Business Review, psychologist Frederick Herzberg published the results of his meta analysis of all factors relating to job satisfaction (which is more or less the same as what we call employee engagement today). Far and away the leading component of extreme job satisfaction was achievement.

One of the most important questions a leader can ask is: "Who does what well around here?" That question can open the door to increased employee engagement.

The best answer I can give to this question is: Read the book, 12 The Elements of Great Managing. In the introduction of this book (one of the two or three best books on management ever written), you'll get all of the evidence you'll ever need. Here are a few of the highlights:

Engaged employees average 27% less absenteeism than those who are actively disengaged.

In publicly traded companies (in the Gallup database), the more engaged organizations outperformed the earnings per share of their competitors by 18%.

Leaders and managers (but mostly managers) have almost total control of the level of employee engagement within their organizations. Given the benefits that accrue from high levels of employee engagement, you just can't consider yourself a great leader unless your staff is highly engaged.