Tips on how to scale a business

As a business consultant supporting organisations across industry and around the world for over 20 years (and I am always conscious of sounding old.  I assure you that it is depth of knowledge, not one year twenty times over!), I’d like to share some tips on how to scale a business. Scalability is about capacity and capability.  Does your business have the capacity to grow? Do your business systems, infrastructure and team have the capability to accommodate growth?

Even if you manage to sell like crazy, you will still encounter the next problem in business growth  This is likely to be the ability to be able to deliver to all those new customers. Bottlenecks keep moving! In the context of business, scalability describes the ability of the business to grow without being hampered by the available resources when production increases. Advances in technology over the years have made scalability more convenient, as it has made acquiring customers, expanding markets and scaling the business much easier.

Common signs your business is cracking under scale issues is confusion amongst staff members, orders getting lost or forgotten, not enough manufacturing or inability to deliver. Those manual process that were fine while you were small are now slowing you down and creating unhappy customers, and potentially burning cash. Here are some key steps to getting on top of the issues.

Step 1 - Finding the cash to scale

Regardless of your scale strategy, you will need cash to fund your growth and help you implement the actions necessary to take you to the next step. Lack of cash can be a big hurdle for growing businesses, but fortunately, there are plenty of creative options you can explore before seeking investment and sacrificing equity. These might include Kickstarter and crowdfunding, creating a revenue stream eg. subscription, joint ventures or bank loans.  Managing your own cash and self-funding means that you don’t need anyone else’s funds which often come with demands on how you run your business.

Step 2 - Establishing good processes and procedures.

You cannot scale your business unless you’ve established processes and procedures that facilitate streamlined operations. You must ensure the appropriate delegation of these repeatable standard processes to simplify growth of your business. While story telling may have worked in a small business, a growing business must put them into writing.

Key procedures will be different for each business but they might include:

• Customer Strategy & Relationships (Marketing)
• Employee Development & Satisfaction (Human Resources)
• Quality, Process Improvement & Change Management.
• Financial Analysis, Reporting, & Capital Management.
• Management Responsibility.
• Customer Acquisition (Sales), Retention and Growth
• Product Development.
• Product/Service Delivery.

Step 3 - Automating processes

Automation allows you to run repeatable processes smoothly at a lower cost and more efficiently by minimising your manual work. It allows your business to improve the delivery time of any task and it further reduces the risk of human error.

Processes which are easily automated include:

• A client management system to manage contacts and track leads.
• A robust system to manage sales orders and integrate with accounting systems.
• A billing system and a receivables function to ensure invoices are followed up and collected.

Step 4 - Improve company communication

It is very important that as your company grows you do not forget to keep your people involved with the changes. This might be a good time to create a written company culture and clearly write your companies values. Take care of your team Recognise them for their hard work and celebrate the effort they're putting in to help your business grow. Scaling is an opportunity to give employees more responsibility and even expose them to new parts of the business they haven't worked in before.

Step 5 – Get some advice

A fast-growing business will soon exceed the point where the founders can grow it alone. When you reach this point, strategic advisors can help you push through this growth hurdle and get to the next step. That's because the right strategic advice will shortcut your learning curve and become a catalyst for growth.