The majority of business owners aspire to grow their company – and there can be many advantages in doing so. As a few examples, as well as enhanced returns to the owner, a larger organisation can attract bigger clients, with bigger budgets, gain market share and benefit from the cost advantages of economies of scale.
To be in the position of planning a growth strategy, things have to be going well:
- The right products or services are being offered
- These are well positioned in the market
- The company has sufficient resources to manage output
- The quality of the product or service is maintained
- The business model is financially viable
When everything is slotting into place, the thought of making changes to the business structure seems pointless. The current model is clearly working, so why do things differently?
Things may continue to go well for some time, but without change the company will reach the limit of its business capacity. Rapid growth is detrimental to many organisations because they haven’t put the right systems in place to cope. They reach their limit and then things start to go wrong:
- Staff get stretched beyond their capabilities
- Sales can outstrip production and thus quality can suffer
- Customers start to detect delay, loss of customer service, bad products
- Production resources, in use for higher proportion of time, start to need upkeep
- Costs to replace faulty goods, incorrect destinations, compensate for late arrival, all increase
- Management time is spent on fire-fighting rather than developing the business
- Reputation fails in the marketplace and marks the end of the good times
Management Before Marketing
When sales are on the up, it is tempting to focus attention on marketing. Building brand awareness and putting your products before potential buyers is a clear way to encourage more sales.
The reality is that all aspects of the business have to grow in unison in order for the company to realise success – production capability, staff training and awareness, quality control actions and so forth all have to be increased too. A high volume of orders has to be deliverable; to the same quality standards for every customer and in the expected time frame. If not, the reputation of the business can quickly take a hit.
Planning a growth strategy begins with implementing scalable management systems. By starting this way, all the benefit of the increase in sales flows back to the business – otherwise it is simply absorbed when trying to sort of the resultant problems. These management systems have to put efficiency at the heart of growth. Effective management includes clarity on responsibilities and accountability. It also involves a means of monitoring processes and measuring output, then using this information to inform change.
Reviewing existing management systems will help you to understand which work effectively and what needs to be in place to resolve regularly occurring issues. This may not sound as exciting as fitting out a retail unit or running a social media campaign, but it is far more crucial for long term success.
Growth and Efficiency
Growth and efficiency run in parallel. By implementing management and quality systems that work, you are off to a good start. There is also a need to incorporate your standard procedures into a comprehensive system so as to better measure the results. Then you have a strong foundation on which to make informed decisions for the future.
As sales increase, your systems will support the growth. You’ll know where the gaps are and you’ll have the finances in place to invest in the necessary skill sets and resources. Your quality assurances will retain customer satisfaction and you’ll be in a strong position to explore new business opportunities.
Quality and Efficiency for Growth
If business growth is on your mind, now is the time to contact our Qualitators. As experts in quality systems and efficiency, they can kick-start the process with a review of your existing systems. In addition to highlighting what’s working, they will advise on the improvements that can be made.
Their continued involvement will support the development of scalable management systems, quality control processes and business plans. Your company will then have the necessary foundations, as well as the future plans to both realise and capitalise on the growth and efficiency changes that are made.By Carl Kruger on September 12th, 2017 in Uncategorised