I use the acronym L I D to remember this law - Learning Increases Development.
The Law of the Lid says that leadership determines a person's level of effectiveness. The lower an individual's ability to lead, the lover the lid of his or her potential. To give you an example: if your leadership rates an 8 (based on a scale of 1 - 10, with 10 being the highest and 1 the lowest) then your effectiveness can never be greater that a 7. If your leadership is only 4, then your effectiveness will be no higher that a 3. Your leadership ability always determines your effectiveness and potential.
In The book, The 21 Irrefutable Laws of Leadership, John Maxwell tells a story that illustrates the Law of the Lid. In 1937, two young brothers named Dick and Maurice opened a small drive-in restaurant in Pasadena, California, located just east of Glendale. Their tiny drive-in restaurant was a great success, and in 1940, they decided to move the operation to San Bernardino, a working-class boomtown fifty miles east of Los Angeles. Their business exploded. Annual sales reached $200,000.
In 1948, their intuition told them that times were changing, and they made modifications to their restaurant business. They streamlined everything. They reduced their menu and focused on selling hamburgers. They created what they called the Speedy Service System, in which their kitchen became like an assembly line, where each employee focused on service with speed. The brothers’ goal was to fill each customer’s order in thirty seconds or less. And they succeeded. By the mid-1950s, annual revenue hit $350,000, and by then, Dick and Maurice split net profits of about $100,000 each year.
Who were these brothers? Back in those days, you could have found out by driving to their small restaurant on the corner of Fourteenth and E Streets in San Bernardino, to see a neon sign that said simply MCDONALD’S HAMBURGERS. Dick and Maurice McDonald had hit the great American jackpot, but they never went any farther because their weak leadership put a lid on their ability to succeed.
The McDonald brothers’ genius was in customer service and kitchen organization. That talent led to the creation of a new system of food and beverage service. But in 1952, when they tried marketing the McDonald’s concept, their effort was a dismal failure. The reason was simple. They lacked the leadership necessary to make a larger enterprise effective. Dick and Maurice were good single-restaurant owners. They understood how to run a business, make their systems efficient, cut costs, and increase profits. They were efficient managers. But they were not leaders. Their thinking patterns clamped a lid down on what they could do and become. At the height of their success, Dick and Maurice found themselves smack-dab against the Law of the Lid.
In 1954, the brothers hooked up with a man named Ray Kroc. As soon as he visited the store, he had a vision for its potential. In his mind he could see the restaurant going nationwide in hundreds of markets. He soon struck a deal with Dick and Maurice, and in 1955, he formed McDonald’s Systems, Inc. (later called the McDonald’s Corporation). The leadership lid in Ray Kroc’s life was sky high. Between 1955 and 1959, Kroc succeeded in opening 100 restaurants. Four years after that, there were 500 McDonald’s. In 1961 for the sum of $2.7 million, Kroc bought the exclusive rights to McDonald’s from the brothers, and he proceeded to turn it into an American institution and global entity.
It is my belief that with raising your LID success is within your reach. Learning increases your development and decreases the chances of limited effectiveness. Without leadership ability, a person’s impact is only a fraction of what it could be with good leadership. Your accomplishments are restricted by your ability to lead others.
Remember, the lower an individual's ability to lead, the lover the lid of his or her potential. If your leadership rates an 8 (based on a scale of 1 - 10, with 10 being the highest and 1 the lowest) then your effectiveness can never be greater that a 7. If your leadership is only 4, then your effectiveness will be no higher that a 3. Your leadership ability always determines your effectiveness and potential.
Work to raise your leadership lid. When your leadership lid is raised you will be able to influence others to become leaders which leads to a multiplying effect.
Access your leadership level by completing this leadership assessment.