Once upon a time a bright young engineer decided to start her own construction business. After years in the industry, she had grown weary of the pointless meetings, bureaucratic processes, and military style organizational models. She dreamed of creating a company where she could do interesting work, earn a good living, and have more fun.
When the company she worked for was sold, Briana joined with some like-minded associates and launched The Briana Company. It was hard work, but so worth it. She had an intensely loyal team that worked hard and supported her. Folks knew what needed to be done and did it.
Over the next 20 years, The Briana Company saw many changes in its core market, including increased costs and competition, and new technologies. They attempted a number of growth initiatives, including geographic expansion, new business lines, and strategic new hires. Most failed, eroding profit margins and limiting investment in technology and employee development and retention.
Briana persevered. Something clicked, and sales took off with a 60% increase in less than two years. The company added new customers and began winning larger, more complex projects. They were short-staffed and struggled to attract and retain new talent.
The new customers were demanding and impatient. They had their own processes and preferences. The learning curve was steep. Employees were complaining. A handful of long-term key personnel left.
Briana was overwhelmed with constant demands for direction, solutions, and assistance. It seems no matter what she did, someone was unhappy with her. She was tired, anxious, and filled with despair. But mostly, her heart was broken.
Avoiding the Growth Conundrum
The Briana Company is a fictional composite of small and medium-sized companies I work with that fail to adequately prepare for business growth and change. I wonder if it is due, in part, to skepticism or doubt the business owner and employees have in their ability to change.
As a business grows and develops, several factors are prominent in determining ultimate success or failure. Let’s look at our fictional business owner Briana.
The business was built around Briana’s talents and vision. Briana’s ability to do the job was a priority. Her ability to delegate and hold others accountable was not since the team was small and well-defined.
As The Briana Company grew, new skills were needed in sales and operations that at first supported, and then supplanted Briana’s skills. Over time, Briana had to do more time managing and delegating. She also had to invest in employee development and seek more experienced talent to help her effectively scale the company.
An Owner’s inability to stop doing and begin managing and delegating can ultimately lead to the demise of the business. But it doesn’t have to be that way.
If you are business owner contemplating a growth strategy, consider the change in personal activities such a decision entails and consider the following questions.
- Do I have the quality and diversity of people needed to manage a growing company?
- Am I willing to make a critical examination of the skills the company needs to grow and invest in training and development?
- Am I willing to replace under-qualified and poor performing staff?
- Do I have now, or will I have shortly, the systems in place to handle the needs of a larger, more diversified company?
- Am I willing to invest in technology and support to streamline the business?
- Do I have the inclination and ability to delegate decision making to my managers?
- Do I have enough cash and borrowing power along with the inclination to risk everything to pursue rapid growth?
- Am I willing to endure short-term discomfort in exchange for a more profitable business?
Perhaps the ultimate question for the business owner seeking to grow is the all-encompassing, What do you really want, and what are you willing to do to get it?
A major challenge in a small company is the fact that both the problems that emerge, and the skills needed to deal with them change as the company grows. Owners must anticipate and manage these factors.
If you need help with your next business move, let’s talk. Surrounding yourself with advisors you can trust is smart business. It allows you to move forward with confidence and focus on what’s important.