When an organization starts its operations, it has a certain scale that it is following. Based on that scale of work, the different employees play a host of roles and most of the roles tend to be hybrid ones. So irrespective of age, we have individuals who are becoming leaders because they gain experience of managing multiple business elements. The management levels are no longer the defining parameter for a leader, potential and performance are the criteria.

As the scale of operations grows, the corporate strategy of the organization also undergoes a change. Different people are needed to manage the multiple elements and accountabilities, and that creates the requirement for leaders of different kinds as well as at different levels of the organization. Functional or technical expertise leaders, people managers, team leaders and so on are some leadership roles that arise and the earlier definition of a leader gets evolved and redefined. 

Now, the requirement is to have leaders at the top, middle and entry levels of the organization’s structure, so that the vision of those who had founded the organization or have been leading it so far, is cascaded down in the correct way. The sharing and percolating of this vision to the different levels is what will drive the creation of more leaders. 

A hugely negative implication of not growing leaders as the organization expands, changes its growth trajectory and business direction, is that there will be a stagnation that will set in. So despite the growth that is projected, actual growth might not take place because the organization will continue to work the same way and hence yield the same results. The next phase of growth will become difficult to achieve without investing in new leaders across the organization.

There are some further challenges that will arise in the event that leaders are not grown and groomed, to create a pipeline and internal pool or network – 

• A growing organization needs to have business continuity – It needs to have leaders who can take on the different tasks so that there is less dependency on just a few individuals. This is one big way of mitigating your risks and business impact. 
• Organizations need a culture of performance orientation in order to meet new and aggressive business goals. Enabling high potential leaders to achieve these is what will help create healthy competition within the organization. That is important from a growth point of view. 
• Employee retention is better since there is a career path and progression that is more visible to high potential employees across each level and they know they do not have to spend a long time in the organization to achieve leadership roles. 

The founding leaders or the entrepreneurs need to be involved in growing leaders internally at all stages of the process. Through their own actions and words, they not only reinforce this culture and approach, but can also ensure the right communication of the business vision and be actively involved in assessing the right leaders for each level.