In our last Equipped to Compete blog we talked about the characteristics of a successful start-up. Clarity of purpose, entrepreneurial spirit, persistence… But we don’t often hear about how established small and midsized businesses make the crucial jump to being sustainable high-growth businesses.
The fact is that lots of ambitious, fast-growing companies expand for a while, but then reach a point where they are held back by operational constraints. Their technology isn’t flexible enough; they can’t recruit the right leadership or get access to the right skills; their distribution network can’t cope with the volume of orders….and more.
Scaling your organization to meet the needs of an uncertain future is a tricky business. But get it right and you can deliver even the most ambitious growth strategy. The first step is to put the right operational infrastructure in place, starting with basic elements like drawing up an org chart, defining clear reporting lines and creating simple communication channels.
Are you going to have tight central control or a devolved, flexible structure with a lean executive office? What about a sourcing strategy? Should you outsource back-office functions to stay flexible? Or are certain functions a core part of your business that you need to keep in-house, where you can exert close control?
One key aspect of this big shift is that it is usually time for the company’s founders or CEO to empower and delegate. You need to establish ways of working that don’t depend on the boss’s sign-off. It’s time for policies, disciplines and standard, repeatable processes. For example, if your cash management procedures haven’t evolved from those small business days, you need to rebuild them on sound financial principles. It may feel unnatural at first, but automating everyday procedures frees up people’s time and talents to make sure you stay entrepreneurial in spirit, if not in size.
Of course, if your name’s above the door, it may be unsettling to see other people doing things differently but, as long as they stay faithful to your guiding principles, it’s the only way to set your company free to grow into a genuine market force.