When you’ve only just started your business, it might seem like the risk of not being able to hold it together and losing it all is so real that you barely have time to think about it, you just have to keep working, keep moving, and ensure that things are staying afloat. As time goes on, you might find the existential anxiety of “will I make it?” isn’t as common a feeling. However, there can be a sense of disconnect from your home business as it gets increasingly complex and run by more people.
As such, you may not have your finger on the pulse of the business, specifically, the potential problems you need to address as it continues to grow. Here, we’re going to look at some examples of those problems and what you can do to mitigate them.
Know your true north
As a business grows, running it will become more and more complex. It’s not uncommon for those who founded the business, those who were most close to its core principles and aims, to lose touch with it a little as they take on more and more responsibilities. As such, you should make sure that you at least have your growth objectives clearly laid out and made available for all of your business’s decision-makers to see. This can include what metrics you need to reach for further growth, what your aims in growing are, what internal improvements you want to focus on, and more.
Letting go of the reins of the day-to-day
When you first start a business, you are going to be right there on the front lines, usually taking part in the production of your products, delivering services, and interacting directly with customers. As the business grows, you’re more likely to take a back seat from this role, delegating more and more as you take on responsibilities of management, resource planning and, eventually, an executive function focused on the growth of the company.
Learning to work on the business, not in the business, can legitimately be a difficult lesson for a lot of new business owners to learn. However, unless you’re willing to hire someone to make the business decisions for you, you will eventually need to scale back your involvement in the day-to-day and avoid micromanaging those who are taking it over for you.
Losing sight of the business’s core functions
When you do start taking a back seat from the business’s day-to-day, then what your day-to-day looks like can change so much that it can begin to warp your view of what the business’s core functions are. Your work might be essential for the running and future planning of the business but if, for instance, you are in a crisis situation and you need to scale back operations to make sure that the core functions of your business are able to proceed unimpeded.
Even if everything else has to halt, then you need to make sure your priorities are in the right place. Work out your core functions and, no matter what, make sure that they are a priority. What makes your business earn money and keeps it existing?
Taking on more financial burden
One of the most frequent problems with having to manage growth is that, often, you have to borrow money to do it. As a result, you can end up a little overborrowed if you’re not careful. Additional capital is usually a must for businesses, which means that you could be dealing with negative cash flow and lower profits for some time.
Making use of internal sources of finance can help you avoid overleveraging your credit to some degree. Otherwise, make sure you’re taking the time to get the best loan that’s available to your business.
The need for more customers
Finding your customers and keeping them coming, and returning is going to be one of the key parts of your business’s growth, period. If you can’t bring them in, then you can’t grow a business. However, once you get the investment or loan you need to scale your business, then you will find that the business’s demand for fresh and returning customers is going to grow, as well.
As such, you need to make sure that you’re able to go to where your customers are and win them over in greater numbers, while also working to improve their average lifetime value. This can mean a range of things, from investing in new marketing strategies to improving your customer service processes.
Your increasing reliance on new people
When you first bring people in to work on “your baby,” it can legitimately feel like you’re giving up a part of something that is unique and special to you. This feeling does go away as you expand the team further and further, but you should still make sure that you’re involved in finding the right staff to help you fulfil your goals.
As you get less hands-on with more and more parts of the business, it’s your choice of team members that will drive the success or failure of different aspects and processes in the business. As such, coming up with a clear hiring process that your managers can follow can ensure that you’re always steering the ship towards quality hires. You want to make sure that the people you hire not only bring the skills that you need but also fit the burgeoning company culture of your business.
Dealing with stakeholders
As your business grows, you might find yourself having to share the reins, to some degree, with others. Either you can start welcoming investors and literally sharing the business, be it with large stakeholders or with a board of investors representing those who have invested in the business after it has gone public.
There are other ways your business can bring on stakeholders, too, but once you do, ensuring that they’re working for the good of the business is essential, which is what a board review process can help you do. You can make sure that the people who are influencing the decision-making in the business have the information they need and are aligned with the business’s aims and values. Again, having your growth objectives and your business value’s clearly outlined can help you do this, too.
Creating a company culture
It’s not unfair to say that a lot of business owners can get tripped up by the very notion of a company culture, or an organizational culture. After all, when it was just you and a few members of a small team, “culture” isn’t something that you have to worry about very much. When your business is growing to include dozens and maybe even hundreds of people, however, you can’t manage the kind of work environment, communications, and work traditions you want by direct communication alone.
Take the time to define what you want your company culture to be and, more importantly, how you can put it in place. One increasing problem in the business world is that a lot more businesses are using inactive speech, i.e. making something policy, to avoid having to actually act on it. When you’re writing your company culture, think about the actions that you can take, directly, to make it real.
Recovering from failure
As businesses get larger, growing from a team of individuals to a cluster of teams, you are going to find that it is a little less agile, a little more cumbersome, since decisions have to be made that affect a much wider group of people. However, even when that is the case, you have to be able to make sure that your business can fail quickly.
Your business is going to make mistakes, and you need to be able to spot them, fix them, and learn from them rapidly if you don’t want your business to get bogged down in the process of spending too much time troubleshooting. You have to be able to refocus. Working with a business consultant can be particularly helpful for helping you get some perspective on problems that you might be too close to.
Keeping in touch
As a business grows, the sheer amount of contacts that you need to manage can begin to expand exponentially, too. This applies not just to you, but to business contacts for the whole business, as well. As you collect data from various sources, such as your sales team, marketing team, and your own networking, your contacts database can start to get a lot more complex. You can simplify things with tools such as a customer relationship management tool that will allow you to much better track your histories with your leads and past, customers, for instance. It means that you have to rely less on the individual memory of team members, institutionalizing that memory, instead.
A growing business is a great quandary to have, but it can come with real problems that, if you fail to manage properly, can put what you’ve earned at risk. Make sure that you’re planning ahead for just that reason.