For many small businesses, there comes a time when it’s necessary to scale up. Many businesses attempt to grow, but not all succeed. If a business grows too fast, it can lose sight of its founding mission and values, overextend itself financially or fail before it has built the solid foundations for long-term success. Growth becomes infinitely more achievable if approached with a repeatable, strategic mindset. Having worked with many growing businesses, from start-up to scale-up to unicorn, I’ve seen plenty of examples of how to grow and how not to grow. If your small business is ready for growth, here are a few considerations to keep in mind.
Do your due diligence
One of the primary challenges growing businesses encounter is realising too late that there isn’t demand for their product or service. Before you fall victim to the same fate, determine that there’s a need and an audience for your product or service. Be clear in your value proposition, and targeted in your audience. If you’re too broad or too unclear, you’ll stretch yourself and end up targeting nobody.
If the first step is determining whether there is a market for your offering, the second is analysing whether scaling will actually be profitable for your business. If the path to strong or long-term ROI isn’t clear, don’t rush, you’ll only financially overstretch yourself. When businesses grow too quickly, they often lose control or stability. Often when that happens a business introduces policies to regain control but usually only succeed in suppressing innovation. To avoid this, establish processes, frameworks and a standard operating procedure. This will help you maintain control even as you scale.
Align your business
An often overlooked ingredient for successful growth is alignment. When a business operates in unison with collaboration, communication, a shared vision and metrics for success, it can grow sustainably. To truly align, you must unite every team member or department under your overarching goals, then align these goals with the needs of your customers and market.
To do so, you must be thorough. Align your financial and business plans and monitor key success metrics closely and openly as a team. Open, honest and aligned communication about metrics, challenges and opportunities helps create a sustainable growth mindset. When done well, business-wide alignment can become a direct, powerful and reliable driver of growth.
Expand your team
It’s easy to think the faster you hire the faster you grow, but that’s often not the case. To scale successfully, your business must operate with a focus on ratios. If you over-invest in one team without thinking about the effect on another, it can lead to hitting “potholes” that impede growth. For example, if you double your product and engineering teams to develop new product offerings, but aren’t able to see commensurate sale increases or haven’t invested in increased marketing efforts to generate demand for the new products, the go-to-market for your new products may “fail to launch”.
Or, if your growth or sales teams are expanding, so too must those behind-the-scenes like finance, HR and admin. Not every role in a business is revenue-generating, but everyone is a key cog in the growth machine.
Scaling a business is an exciting journey, but requires careful consideration. Relying on the same tried-and-tested approach that helped you start your business often doesn’t suffice, while pushing too hard, too quickly, can see businesses falter before they’ve even got into their stride. By doing due diligence, aligning your business behind a shared goal, and understanding how to scale your team as your business grows, you’ll have a better foundation to transition from small business to scaling business.
