Solidify These 5 Business Fundamentals Before You Grow
By Shindy Chen | October 29, 2015
Every company’s primary purpose is sustained growth. This may involve seeking outside investment, raising capital, or joining and/or acquiring a like-minded company with a similar product, service, or market.
But putting the cart before the horse can do more harm than good to the business and most importantly, its customers. Before getting bigger, it’s essential to ensure the following key fundamentals are in place.
Anyone will tell you that having the “right people” is essential to growing a company, but what does this mean, exactly? Managers who were trained to carry out responsibilities based on existing arrangements, methods, and concepts may not be ready to adapt to new models, workflows, employees, or even leadership. “Understand that some managers cannot handle growth-oriented initiatives—make sure they’re in line with the goals being sought,” according to company growth strategist Marc de Swaan Arons in Forbes Magazine.
Targeted growth training prior to expansion may be necessary to ensure managers can continue to guide and empower others. Companies can start by tapping their HR teams to develop any additional outreach or training programs required, and to ensure leaders are informed and delivering consistent messages.
With each major addition in the workforce, a company’s intrinsic culture is at risk of dilution. That’s not necessarily a bad thing. Like living beings, company cultures are always evolving, and any change in regards to size or process will make an impact. To help the company evolve successfully, gather high level company officials to review mission statements, workflows, key tenets of the business, and achievements. Re-stating the core principals that have gotten you this far will help you continue to uphold them as the company moves forward.
What technology tools are employees using to communicate with each other and perform their day-to-day work? Can these tools support high demand, more complex processes or a larger organization?
Just because existing tools perform basic functions doesn’t mean that they’ll be the best tools going forward. Oftentimes, company employees and leaders will already have solid ideas about what potential tools, methods, and software might be better suited to get things done. Heed their suggestions. Before integrating or adopting to new technology, be sure to test it among small groups and roll it out in small batches.
Employees and customers at every level share a certain level of anxiety when they learn that a company is expanding, merging with another, or being acquired. Don’t blindside employees — be sure to deliver timely internal messages regarding fundraising or a merger or acquisition.
For customers, it’s essential to detail the benefits of upcoming developments and , and whether anything, especially their experience, will change on their end.
Are the company’s departments set up for expansion? According to a McKinsey and Company report, “Well-defined organizational structures establish the roles and norms that enable large companies to get things done. Therefore, when growth plans call for doing things that are entirely new — say, expanding into new geographies or adding products — it’s well worth the leadership’s time to examine existing organizational structures to see if they’re flexible enough to support the new initiatives.”
A traditional retailer may choose to operate a new subset of outlet stores with management at arm’s length for maximize efficiency and autonomy. A product company that has typically used an executive panel to approve new products may find this model unscalable with an influx of new products and innovation. Thus it’s necessary to evaluate what processes can feasibly carry the business forward.
Company leaders are responsible for performing not only a thorough SWOT analysis but also evaluating the above qualitative components before getting bigger — or risk internal disorganization and pushback. Each company is different and has its unique growth drivers, but these solid principles will help address the basics.
ABOUT THE AUTHOR
- NAME: Shindy Chen
Shindy Chen is the founder of Scribe, a content consultancy. She curates, writes, and edits for clients in the finance and tech industries. She also contributes to The Huffington Post and is author of The Credit Cleanup Book (Praeger). She was previously a Vice President in consumer lending at Wachovia Bank, and worked in financial broadcast media at CNBC and Bloomberg TV.
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