Are you ready to scale up your business and dominate your industry?
Have you thought about the challenges that occur when you need to deliver consistently whilst achieving high growth?
In this blog, we look at 5 areas of focus.
1. Cash conversion cycle
The cash conversion cycle (also known as the net operating cycle or cash cycle), looks at how many days it takes your business to convert cash spent on inventory back into cash received from selling your product/service. As you scale, you will need to spend more to make more. Getting your cash conversion cycle right when scaling at speed can be a balancing act, yet with adjustments to internal processes it can be achieved.
As an example, Dell Computers used to produce hardware and place it into shops for sale. They spent the money to build the product, then had a period of waiting before receiving funds from their sales. They changed their model to ‘build on demand’, received money upfront and made their computers to order.
2. Scaling your systems
When creating systems which are fundamental to the smooth running of your business, ensure that they are future proof. This means that they need to work when the business scales, not just for the here and now. If you start with a basic system and ad multiple bolt-ons to cover up the cracks created by growth, you are heading towards disaster.
Investing in the right technology to make your business agile and adaptable will pay dividends in the long run.
Build your systems with the customers needs in mind, not the needs of the business. An example of this is online check in for airlines. This system improves the customers experience by giving them a form of control over their checking in experience, allows them to select their own seat and access their flight information from a variety of different devices (mobile phone, laptop, ipad etc).
3. Your product and services
Are your products and/or services scalable?
Do you have a reliable supply chain in place?
Can you guarantee the quality of your product or service will not suffer as a consequence of scaling up?
As a business grows, you may find that your customers look for reasons to doubt you. To counteract this, devote your business to the customer experience and ensure that it is either maintained or improves as your business grows.
4. Your people
Are your people ready for growth? Have you given them the tools, resources and training necessary for success? Have you provided them with a vision for the future so they know what they are working towards?
During phases of growth, loosing and gaining people may inevitably happen. Some employees have the right skills to get you to a certain level, thereafter the business outgrows them. Look at the skillset in your current workforce – are you utilising it correctly? Are there opportunities for change or promotion within your team (whilst being mindful not to overpromote)? Or do you require fresh ideas and new people to shake things up and add a new layer of expertise to the mix?
Your employees are the numbers one asset in your business – they are what differentiates you from your competitors and makes you stand out from the crowd, so be sure to look after, nurture and protect them as your business changes.
5. Your framework for growth
Be clear on your current position and what you need adjust in order to sustain profitable high growth.
Prepare yourself for challenges heading your way at high speed from all aspects of the business, not to mention external pressures and juggling your personal life next to your professional one.
It might help to know that you are not alone and that many businesses have trodden this path before you. Seek valuable insights and strategies from trusted advisors to help you navigate the scaling up process successfully. Such knowledge can help you avoid costly and disastrous situations.
Speak with a business growth specialist, reach out to your business community and read business books to equip yourself with all that you need to make your business the success you envision it can be.