You’ve tasted success! You knew your idea was great and you ran with it. Your business grew fast. You began to start taking a salary. You are your business. You can and do everything from marketing to customer support. You are amazing! Your customers are happy and they keep recommending you. You’re watching your profits soar.
You are cruising along and you hit a bump in the road. The nonstop work is taking its toll and you are being stretched too thin. Your customers aren’t happy that they can barely get you on the phone. The solution is to hire more employees and to do it quickly. You hire, train, fire and repeat. It is a time consuming and costly road. Some employees are superstars. You give them more responsibility and they hold more knowledge. You start to let go of responsibilities and delegate them to your employees. Your business is still growing but your growth chart looks more like a staircase instead of a rocket blasting off.
Something is not right. Your growth has plateaued and you’re not sure exactly why. You work harder at sales and marketing, trying new things and see small successes. Sales then fall, then rise, then fall again. It is stressful. Your company has grown and you start to lose the family feel. You worry that employees will quit and if they do you know longer are able to do their jobs. Everything seems out of sync. You wonder who is working for whom. All of your time and energy is spend keeping your house in order. This is the bumpy road to nowhere. This is not the dream you thought it would be.
The business described above is in stage 3 of the growth chart above
Where did it all go wrong? A casualty of the business planning process for many small business owners is delaying the adaptation of best management practices. Typically the business owner waits to implement these practices until they see a significant growing or slowing of the business. The business owner may think that these can be put off until they are “successful.” This short term thinking is a big mistake.
Best Management Practices are essential to manage rapid growth in any business. Without these practices in place a business does not have the proper infrastructure it needs to accommodate an unexpected growth in sales. As the growth chart moves forward and up you are beginning to compound the issues of not having the proper infrastructure in place. A solid foundation is just important during a rapid growth phase as well as a business recession.
The problem that many business owners do not see is that the first phase of growth for a business is wonderful! It is your first taste of success. Nothing can go wrong and your dreams are becoming reality. This is precisely what lulls the business owner into a false sense of security. It is not openly apparent that there are cracks in the foundation.
The next step to handling this surge in sales is to hire more employees and to delegate more responsibilities. This can be costly and time consuming without a clear set of best management practices implemented into every facet of your business. Training becomes simple. You can hire employees, train them to do specific processes and let them get on with helping your business make money. Without these practices you are spending more time training than getting back to working on your business.
As you hire more employees the common issue is that they start to do more and more within the business. They are creating their own processes and may be doing a very good job. But what happens if that employee leaves, gets sick, or wants to move up in the company? If there are no documented best management practices in place your business faces a real challenge of filling the gap that an employee may leave. Although the foundation is building up it is not as solid as it looks. You are creating more of a house of cards instead of a building with a solid concrete foundation.
If only someone would have explained these things during the first phase of your growth. It is apparent that creating best management practices from the get go will build the solid foundation that your business needs to create the sustainable growth that you desire.