What does it take to expand your business? What are the steps? What do I have to philosophically and psychologically prepare for?
How do I take my small business from the initial growth stage where, you’ve made enough money, you’re meeting expenses and maybe even more, you’ve got a couple of employees, you’ve got some structures in place, but you want to get to the next level of your small business?
Ready to Expand Your Business? Start Planning.
You’re being stopped and held back by either a lack of planning, strategy, or just plain paralysis. You’re not really sure things are so busy that you can’t get to the next level. The important thing is to decide if you want to grow.
There are some costs involved and hopefully, by presenting what’s typically required to make this happen, you can think through whether you want to do it or not. So there are a couple of things to look at. One is your systems, secondly, your functions, and thirdly, your employee retention. These involve some work and upfront work, and it’s almost required work.
Now you can spread it out over time to build it, and that’s probably the best way to do it, cause it’s probably not going to happen like in a one-month spurt. It could, but it probably won’t. So there are a couple of things.
Firstly, the assistance, as I said, so you want to identify systems and functions that go together hand in hand. You want to identify all the functions that you want to hold onto, what your business partner wants to hold onto, and all the functions that you want to give away.
So you may want not want to hold on to, let’s say administrative tasks anymore. You may be doing some, but you want to give away all of it. At some point, you may be in that position. And so you want to start identifying what those functions are and the functions are really simple. You can look at it as a black box diagram.
Expland Your Business by Mapping Out Existing Systems and Processes
So there are inputs coming in and outputs going out. So an example of a bookkeeping system or function is that the inputs coming in are data from your business, like income, data, receipts billings, invoices, etc., etc., and the output could be a QuickBooks report that goes to your CPA. You want to identify and draw out these kinds of functions.
And there’s some advantage of doing this in an engineering-like manner because when you account for it all you start seeing how you can combine so many systems and functions. Inevitably it happens to almost every client you can combine with them and you can start getting some economies of good design if you thoughtfully design this.
The second thing would be, you may discover some of these functions are redundant, you don’t really need them anymore. So it’s really good to look at this pictorially, or visually for yourself by drawing these boxes with inputs and outputs.
Once you decide on these systems and functions, you’ve got to see which ones you want to keep, which ones you want to delegate to other people and which ones you should use technology for, or which ones you should consolidate and design a better system for the future.
This involves how fast you want to grow, which means you got to start planning out in the next 12 months. How much do you want to grow?
And what’s required for that growth. If you’re going to take on more customers, your systems have to be on par. Remember, you won’t be able to change your systems overnight.
So it takes some time. So you got to pace your business with the redesign of your business as well.
The last point is employee retention. And this is a big one for a lot of people because as you grow, you’ll find a couple of things. One is you need better employees or different kinds of employees to handle the growth.
Expand Your Business by Evaluating Personnel
You may need more leaders and you have to start training leaders, you may need training manuals, you need more training. You need a team that has very clear partnership agreements with you. You need HR policies. And I’m not saying that you have to go out and get an HR consultant and, get everything done overnight, but there’s a lot more upfront thinking required before you go to the HR consultant that is looking at individual agreements, especially with your top-level managers.
What do they want to have for that career in the next one year, two years, five years? Not doing that could be a huge problem for you. Even if you are not committed to growing, because you don’t want to be surprised by someone leaving, especially if it’s a top-notch employee, you want to be able to see, okay, it’s going to last about a year, maybe two years, which is fine.
People need to move on sometimes. And when you deal with younger people these days and in this generation, you’re inevitably going to find people who don’t want to hang around the same company for too long. They want to move on and grow and that’s normal. That’s okay. And you should encourage that, but you want to be clear about how long you want to have this person as an employee so that your business is not at risk.
If you want to grow, you have to be willing to roll up your sleeves and actually go for this kind of work. And the question is, are you willing to do that? And you have the resources. And the money to do that. And if you still want to grow, then you’ve got to have a good plan to spread out the work.
If you need help planning to expand your business, contact me or follow me on LinkedIn.
Since 1991, I’ve been reflecting on, designing, and implementing methodologies and systems for bringing a transcendent, creative and innovative approach to critical aspects of entrepreneurship.