I must confess that when I officially started my coaching practice, I had this preconceived idea of the role I would play in helping my clients achieve professional and personal success. From a business coaching perspective, the focus would be all about how to grow revenue, improve operational performance, further develop leadership capabilities and increase profitability to name a few. All credible business coaching programs should at least address these key success factors and aim to help take the business to the next level – no arguments there! However, what I am observing all too often is a false narrative (driven by those who claim to serve their clients) which revolves around the notion of constantly acquiring and always accumulating, irrespective of what stage the business is at.
Enter the business owner who is growing at an incredible rate but is at breaking point. Overwhelm has taken over and personal fulfilment is out the window. Complex emotions such as resentment and frustration swirl around in response to time and money stress and the illusion of all the benefits of running your own race becomes a mirage in the distance. If someone dares to talk about accelerating growth in this context, then all I will say is good luck with that.
There is no doubt that this may be a very sensitive time for many business owners facing these challenges and coaching to this audience needs to be handled with the utmost care. This is also the time to have the “managing growth” conversation with someone you trust and is probably one of the most important stages to think about engaging a highly skilled business professional who also happens to have adequate coaching credentials.
Whilst everything appears fraught with risk and danger from an owner perspective, as a coach, I think it is important to celebrate what has already been accomplished thus far and to view these new challenges as simply a sign to explore profound personal and professional growth opportunities. The reality is that the world we live in has changed in so many ways. Contemplating what success means or looks like in a small business context no longer correlates to just more and more customers or higher profit margins. Lifestyle, social responsibility, community engagement, meaningful work and professional relationships capture a significant portion of how business owners measure relative success these days.
With all that said, when faced with the practical implications that comes with managing growth, it becomes more of a question of ability to make decisions around priorities and often boils down to choosing between two very distinct pathways as one reaches that all too familiar fork in the road: 1) Continue to evolve as a lifestyle business; or 2) Grow the business with a clearly defined exit strategy. I firmly believe that neither option is better than the other. I also find there are many business coaches out there who advocate a one-dimensional or outdated text-book approach (think 1990’s seminar style stuff) to this seemingly natural progression in reaching business owner utopia. Here’s the thing, none of these so-called guru’s tell you that trying to scale a business presents a whole raft of new issues to consider and that it is not always the obvious choice to follow. Without going into all the details in this short article, the main point I am trying to make is to first take a step back and gain clarity on what your future business goals are and what you really want over the medium term as a minimum.
It is also important to highlight that the lifestyle option does not give licence to maintaining the status quo in your business. Constantly reviewing and making positive changes or improvements to your market positioning, business model and strategic alliances requires plenty of thought leadership and planning amongst other things. On the other hand, if managing growth means relying less on you the owner, then option two requires a real change in mindset as well as replicating that energy and excitement when you first started the business. Essentially, it is about taking the necessary steps to start the process of giving your company its own brand identity while at the same time learning to let go of your connection to it. This part is much easier said than done! Breaking things down into manageable steps is a good way to slowly make the necessary changes and so if option two is something you are striving for, then consider the following key areas to initially focus on:
Realizing you cannot do everything as the owner is one thing, but actually letting go of your direct involvement in every client project or customer transaction is a different story altogether. While it may be difficult for you to come to terms with believing that others will be able to deliver as good as (or even better than) you, the reality is the alternative to this will unequivocally lead to stress, then burnout and finally end in significant reputational damage.
Once you overcome this initial hurdle, do not make the mistake of hiring out of desperation. Setting some time aside to put some simple and effective general recruitment processes in place will save you time and money in the long run. It will not only give you a bird’s eye view perspective on how you want your organisational structure to look like, it will also give you greater clarity around where you believe you will be able to contribute most as the owner as well as be ready to engage an HR professional to speed up the recruitment and onboarding process if need be.
When I talk to most people in this phase of their business, they seem to think that systemizing is all about implementing new technology platforms that can automate those manual and time-consuming tasks or simply outsourcing to those that know more on how to use the various platforms. Sure, this makes sense in many ways and is an important consideration, but in my view, technology is just a tool that can be used to execute operations more effectively. Remember, having access to better technology is one thing, using it in a disciplined manner is another or in other words, garbage in equals garbage out!
When I talk to clients about systems, it is about building the necessary infrastructure that introduces a simple framework of governance to the organisation and more importantly supports a culture of accountability. The mechanism to bring this all together starts with documenting process improvements, reporting and standard operating procedures that are relevant across the core functions within the business. I always like to stress that systemizing does not need to be overly complicated, in fact the simpler the better in many cases. What is important, is to ensure that when creating or designing a new system, report or process, it needs to be both repeatable and consistent. Getting this right will force you to slowly let go and allow you to start seeing the bigger picture as well as give you more options when it comes to scaling and exploring various exit strategies.
It is no secret that managing growth is synonymous with managing cash flow. This, along with maintaining healthy profit margins is often the most daunting aspect to consider for many small business owners, who are ready to take the next step. Whether it is a combination of capital expenditure and working capital requirements or simply one or the other, growing your business further will certainly bring these elements into focus.
Regardless of whether the numbers side is one of your core strengths or not or if it just doesn’t float your boat, when you reach this point in your business, I honestly believe that you should be investing more time in becoming proactive in the financial management of your business. Having greater clarity and understanding around the key drivers impacting your working capital as well as your margins is no longer optional, it’s a must. This is also the same for regular monitoring and reporting being a key activity.
Lastly, if you do not have the internal capabilities yet to explore various financing options available to you, then it may be worth engaging an experienced commercial finance expert or broker to workshop some ideas that will ultimately prevent you from stifling growth. The landscape has changed so much in recent years that many innovative fintech platforms now exist and serve the small business community with specialised fit for purpose financial products.
If you happen to be at this stage in your business, then the reason you have all these options in front of you is because you must be doing something right. Take some time to acknowledge your accomplishments as it will give you that extra boost in confidence to take that next step, whichever way you decide to go.