Believe it or not, not all businesses want to grow. Some people just want a lifestyle business, have it stay about the same, not grow and just keep ticking over.
If that’s your vision for your business, then this blog post is not for you. While it’s a perfectly valid strategy to want your business to stay exactly the same, the reality is that the world of business is constantly changing, which has an impact on your company, whether you like it or not.
When a child plays a video game for the first time, they quickly discover is that the character that stands still gets killed first. It’s the same in business. Usually, you’re going to either grow or shrink your business, but if you’re standing still, you’re really going backwards. Your competitors will be overtaking you if you’re staying in the same place. While staying the same is certainly a type of strategy, you may well decide that it’s not a good one or the right one for your business.
So if after all that, you decide that you’d prefer to grow your business, you’re going to need a plan and you’re going to need to make sure your leadership style matches the demands of your changing business needs.
Break the strategic plan down
Why do so many companies spend so much time doing strategic planning only to fail to execute the vision? Why put a plan together when you can’t actually follow through?
It’s very easy to plan and come up with brilliant ideas and goals for your business. The tricky part is putting it into practice and achieving your targets, which is why so many strategic plans end up confined to a ring binder, gathering dust until someone remembers that there was a plan they were supposed to be following.
Grandiose goals that span years and years are all very well and good, but when it comes to practical implementation, 15 years in the future is too distant for most companies to execute against. Even three- or one-year goals tend to be too optimistic for most companies.
Many companies confine their strategic plan to one year, but have countless goals to hit within that period. However, when you look back over the last year, you’re lucky if you’ve accomplished three or four.
The companies that are really great at executing their vision divide it into 90 day segments. Ask yourself what the three to five most important things your company has to do over the next 90 days. Who in your leadership team owns those deliverables? How are you going to measure those goals?Break down your plan into little tactical bite-sized pieces. It’s much easier to digest that way. Your big vision might cover 15+ years, but in practice, you’re setting up a process so that every 90 days you’ve made significant progress towards your one-year goals and every year, you’re closer to completing your three-year goals.
Set yourself up to succeed
If you’re serious about growing your business, you need to start at the top and work down. If you’re not leading your team in the right direction, everyone will be lost.
Strong leadership doesn’t mean doing everything yourself. In fact, the one leadership skill that’s essential to breaking through to the next level is delegation. Companies that can’t delegate rarely get larger than 50-75 employees, because the entire senior team is so caught up in running the business that nobody has time to think about growing the business.
The second thing you need to look at is your infrastructure, office space, warehousing, technology, etc. Is it really as efficient and effective as it could be? Does it support your company in the way you need? Can it cope with an increase in business?
The third and final consideration is your business focus. As a company becomes larger and more complex, your focus shifts across a number of aspects: financial goals, operational goals, sales and marketing goals, etc. It’s very easy to lose sight of where you’re going as your business needs become more complicated.
Breaking through the barriers
If your vision includes growing your business, there will be a number of barriers you face along the way. When you set up a new company, often, you hire a small number of employees and everyone’s a Jack of all trades. It doesn’t matter what needs doing; everyone is responsible for getting it done. It’s a very simple organisation chart – the CEO is at the top and everyone else is beneath them. If you have a question, you know where to go for the answer because there’s only one person in charge.
There are no business processes and every day is chaos. While this can be fun, a start-up company in chaos mode will be able to make up to around £625,000 in revenue but struggle to break through to make more. As you hit this first barrier, the complexity of the business makes it impossible to get any further.
So the first barrier you need to address is a crisis of business management. Someone needs to look objectively at the company and ask “what do we have to do differently to reach the next barrier?”
Assuming you manage to overcome that hurdle, things need to change. A CEO might have had nine people reporting to them directly when they started up and function perfectly well, but it’s impossible to cope with 45, 50, even 75 direct reports. If you want to grow your company, you’re going to need to recruit leadership talent.
Continue to Part 2 where we'll be looking at the power of middle management and other key areas, you as the business leader should be focussing to break down the barriers to real growth.