How to Scale Without Imploding

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Both new businesses and older, smaller businesses typically have one thing in common: they want to grow, and, in most cases, they want to grow fast. Fast growth, of course, is not something as easy to accomplish as it is to aspire to.

One issue that business owners and stockholders often do not take into account, however, is the problems that a company can encounter when pursuing a path of fast growth. Too much growth can actually have the (decidedly counterproductive) effect of diminishing—or, worse, shuttering—a company rather than expanding its operations. And the same problems that a company can encounter when growing too fast can prove to be impediments to further expansion.

Here are three key things to consider to make a growth spurt less painful for everyone.

Ensure your leaders are up to the job

One of the largest bottlenecks for fast-growing companies is a lack of leadership experience or management capabilities. If the growth of the company outpaces the ability of management to adapt and grow, things will begin to fall apart very quickly. Growing and leading a company with $ 1 million in total revenue requires a very different skill-set than, for example, growing and leading a company with $ 10 million in revenue.

Leaders should always be revising their strategies and educating themselves. They either need to learn the skills to manage the next level of complexity in their business or they need to bring people in who already have those skills. Education keeps leaders thinking bigger, and that is key to success.

Ensure your processes are up to the job

The second issue is that companies rarely plan for the logistical capacity of fast growth. This problem often follows the first. When leadership is not prepared, the company’s capacity is not addressed and growth slows down. The business cannot handle the logistical or staffing demands, and fails to accomplish its goals as a result.

Budget accordingly and begin looking for the staff you will need well in advance. Doing so prevents the type of “panic mode” that sets in when people are unprepared to take on larger demand than the enterprise is capable of meeting.

Set a manageable pace

In order to account for these problems and address them through planning, some companies opt to grow in specific increments, even stifling their own growth if needed in an effort to remain consistent and discipline while scaling up. Progressive Insurance, for example, during their high growth years, planned for between 20% and 30% growth each year. Leadership insisted on at least 20% growth, but would slow down top line growth if they started reaching their upper limit of 30%. By doing so, the leaders made sure their operations were prepared and had strategies in place to prevent operations from becoming overextended. They succeeded because they grew the knowledge, the capacity and the company’s ability to grow into the business they wanted to be in the future—but they didn’t rush it.

The ultimate takeaway for businesses looking to grow is that proper planning is essential. Plan for consistent growth patterns year after year, and spend some time assessing what your team and strategy will look like well in advance.

Growth without a plan results in a company having to play catch-up. By that point, it is already too late to do anything or make significant adjustments. Successful companies have both a vision of what their future looks like, and a plan in place to meet the demands of that vision.

Andy Buyting is the CEO of Carle Publishing. Carle Publishing helps independents publish and distribute their own customized print and digital magazines, positioning them as a leading authority in their marketplace.

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