Posted on 15/07/2015, 14:13
Everyone wants to grow, right? Well not everyone but there’s a well-known phrase that goes “if you are not moving forwards, you are going backwards!”
But I’m not talking about incremental change; this blog is concerned with out of the ordinary growth, 4 key unintended consequences … and strategies to deal each of them!
So where are the 4 Critical Growth Pains likely to be seen?
CASH-FLOW: Growth requires investment; stock, people, capability, product development etc. Without proper planning the required investment can stall your cash-flow with the unintended consequence of stopping growth in its tracks.
Key Thought: Success comes from thinking ahead and accessing financial solutions before the critical period arises. Using cash-flow models and taking advice, plan through the investment period so that you can reap the rewards of growth. The most popular sources of finance are shareholders’ funds, re-investment of profits and banks. However there is a growth in other solutions such as angel investors, crowd funding and asset finance.
LEADERSHIP: Over extended leadership is another key inhibitor. As the company expands, the owner who signs everything, is involved in every process and makes every decision is a critical bottleneck; slowing growth and frustrating staff.
Key Thought: People create the culture required for growth and the role of the leader needs to change; the goal is to create an empowered, dynamic and creative culture where the sum of the parts is far greater than individual contributions. Key to the change is talent acquisition and performance management as delegation to a trusted team and hiring of experienced managers becomes necessary.
CAPACITY: Growth tests every facet of your business; stock control, purchasing, product development, financial processes, manufacturing capacity, supply chain, after sales service.
A supply chain that is not fit for purpose or field service team that can’t handle increased demand can bring growth to a dead halt.
Key Thought: Plan ahead and understand where the likely pinch-points are going to be and invest in both capability and capacity; innovation is a strategic necessity … the most successful businesses demonstrate creative focus, re-tooling business practices, processes and organisational structures.
INTELLECTUAL PROPERTY & LEGAL CHALLENGES: Just because you haven’t been challenged before does not guarantee immunity in the future.
The world changes when you put your head firmly above the parapet or enter new markets. Will you threaten a previously unchallenged behemoth? Are you entering a new market where the rules of the game may be different (true even within the EU)?
Key Thought: Think carefully about what you are trying to do. Risk assesses your plan; get expert advice. It doesn’t need to be expensive; there are small players as well as large legal companies (e.g. http://www.donpennant.com/i/). One thing is sure; prevention is always better than litigation!
So there you have it. 4 Critical Growth Pains that you can avoid with thought and planning and put you and your business firmly on the road to growth.
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