DRIVING A SCALING BUSINESS
Updated: Jul 7, 2020
The world around us is born of processes. For a seed to become a rose, it must undergo a distinct set of steps. Those steps, if not precisely executed, will either present a sub-par flower or worst case, the rose will die.
A rose's growth is as delicate as its petals
We are faced with many challenges when we launch a business. From compliance to marketing; we must execute each department up to a certain level to bloom into a successful venture. One wrong move and your business will wilt.
But how do I avoid failure? Who do I hire first, a manager or an assistant? Should I be frugal here or spend money here? Should I open a new location here or there? Do I sell this product first or this product? The questions go on and on. The unfortunate thing is there are no right or wrong answers - It's all about a balanced execution.
You must fully envision the completed house before you start construction
Dreams, visions, outlooks, or whatever you want to call it; is one of the most important facets of growing a business. It's also most likely why you launched your venture in the first place. To properly execute a set of processes within a growing business, we must have an idea of where the road will lead. This will allow us to answer each question as it pertains to us.
Once you form a clear vision of where you see your business in the next five years, you can start to create plans on how you will craft it. Five years may seem excessive, and it is, but purposefully so. As an owner of a business, the reasoning behind your decisions will empower you to continue to fledge forward, even as times may be troubling. You keep going because you want to reach your goals because you know what your goals are.
Measure your losses, not your gains
Once your goals are well defined, and you start to move forward, you think everything is going well until boom! Someone in your purchasing department made an error on order, and now you must pay with time and money, both of which are equitable, in order to fix the issue. Running a business without the mitigation of risk is formidable to the overall process. Which is why when scaling, you must create a check back system.
Before an assignment is completed in one department, someone must review it to ensure that it is accurate and free of any erroneous information. Then as the project is passed on to the next department, it must be reviewed again before it can be actionable. A good product will sell itself, and the revenue will start to flow into your bank though you need to ensure that you guard those funds. A system that checks itself will decrease the margins of error, which can save you and your firm from monetary losses, time, or even failure.
Storms will come
When you think about strength, you may envision something like the trunk of a tree or that guy at the gym that grunts as he squats two baby elephants in weight. In business, strength is not about brute force it's about fluid dynamics. Water always seeks the path of least resistance. Issues will flow into your system, and you must be ready to cure them. Resistance to your growth will always be present, but a mixture of finesse and force will be the vaccine. You must form antibodies to issues that your business will face. They will act as your early detection system of future issues that may arise. You can then cure them efficiently before they mess things up.
The force is as essential as the fluidity. In business, you will wake up to many bad days that will affect your psyche, mood, relationships, pockets, or even your health. Your girlfriend needs your support, your boyfriend is is having a bad day, or you were up all night taking care of the baby. But you get out of bed, get ready for work, get to the office, and tackle all of those headaches. And the next day and the next. Because your vision inspires you and you've built a whole process around it. You've hired a team, and now they depend on you to safely steer the ship. This my friend, is the definition of grit and you'll need a lot of it.
Some of the best CEOs in the world have a sense of urgency in everything they do. It seems as their feet on four steps ahead of them. This jet fuel will be the propulsion of your business. You have to want to get things done as soon as possible. You don't want to take too long to act.
Speed is important to a business. Too slow and your competitors will surpass you; too fast and you'll fumble along the way - the best way to gauge your speed it to stay close to your business. The closer you are to it, the better you'll feel if your pressure will cause the system to burst. It's like blowing up a balloon. The balloon gives you feedback before it pops from too much air.
Cash is King
You can have an amazing product, a strong team, willpower, plans, etc; but without the capital to launch you’re just a concept or idea. Having capital in a business is what allows the business to sustain which is why you need to be very cognizant of how you spend it. The law of numbers is very relevant when it comes to scaling a business.
The larger you grow, the better deals you should be able to negotiate with manufacturers, vendors, strategic partners, etc. The economies of scale are your sidekick and should be tested against all lines within your balance sheet to ensure that you are negotiating the best deals for your business. To summarize, frugality is your friend and businesses with lean growth strategies are not only more profitable but they’re also more attractive to investors. Every dollar is important, so spend it wisely.
So you want to either grow or start a business. You’re crazy but we all are, right? Having a lot of experience scaling companies, I've learned that it will get messy, but if you think about these five components, you will be that much closer to success.
• Have a vision.
• Create a plan.
• Build a process that checks itself.
• Have grit.
• Be impatient.
• Guard those funds.
But the most important point is to enjoy it. Oh, and don't forget to laugh all the way to the bank.