Overcoming the Most Common Challenges Facing A Growing Business

My business is in a period of strong growth, what should I do now?

Things are going well… until they aren’t. Sales are good, you are adding new clients, people are excited, your friends notice how well things are going and then, one day, it happens. You might not have any cash in the bank, even though sales are up. Or, there might be infighting and unhappy employees; silos are starting to form inside the company, and people who used to work together no longer even talk. You notice that there is a lot of activity but your not quite sure what people are doing or if the activity is actually productive. Worse yet, you might be missing deadlines, or quality may be decreasing, and, then, you realize that your tried and true customers are starting to look for other solutions. Now what?

Anyone who has lead a business through a growth phase understands that there are some real perils that can cause harm and sidetrack the long-term success of the enterprise. There are 5 cornerstones that every business must have in place to successful navigate the tricky waters of growth.

  1. A well-defined strategy and growth plan. While this may seem a bit esoteric, it is actually critical that a business have a True North heading and everyone knows the direction the company is headed. Build specific metrics into this plan as well as pivot points that are reviewed and refined regularly.
  2. Good internal financial controls, reporting, and, forecasting…which is often overlooked. There needs to be checks and balances and a separation of power with the people authorized to approve expenses and those making the payments. There needs to be regular, monthly typically, reporting that includes a P&L, balance sheet and cash flow report. In addition to this, there needs to be additional cash forecasting and reconciliation. Lastly, there needs to be a good annual forecast in place that is reviewed, updated, and refined at least quarterly.
  3. Clearly defined roles and specific expectations. Rapid growth often causes internal processes and procedures to get out of balance. Your employees will find themselves working hard but often there are efficiencies to gain. It is important that internal processes are refined and redefined, that employees have the training and tools they need to do their job, and that there are very clear expectations that are measured and understood.
  4. Create systems for all routine functions including sales, internal workflow, production, hiring, training, onboarding, vendor selection and management, customer on-boarding, etc.. The goal is to take the guess work out of what is to be done next, to eliminate the need to recreate the process every time it is undertaken, and to allow your employees to be successful.
  5. Have the right people in the right position with the right training and tools, and have an organization chart that is flexible enough to anticipate and accommodate future growth.

While these are broad categories, they are intended as thought starters and a quick check on key areas for you to evaluate your business. Each of these 5 are necessary for continued success but the reality is that at any point in time one may be strong while another needs attention. Good systems will mitigate these fluctuations and good luck with continued success in your business.