Is Your Business Really Ready To Grow?
Many top executives say that they want to increase revenues and profits, but are they really ready?
Growing a business is much more than making a wish; it requires a serious commitment as well as staying power. Resources need to be allocated to fund the increase in expenditures that growing a concern requires. Here are some thoughts that should be considered before a decision is made to increase the sales and client base of any organization.
To grow requires a change in mindset to an external focus. Basic business systems have to be in place and working well. Many businesses cannot make the shift from an internal focus to an external one because the systems are not sufficient to support more clients, production, or delivery.
Using an analogy of a garden hose, once the decision is made to put more volume through the hose, the leaks better be plugged, the kinks straightened out and the radius of the hose has to be sufficient to handle the increased flow. Unless this is done, there is going to be a considerable amount of frustration generated. Picture a hose with the faucet opened as far as it can go, with kinks blocking the flow and leaks spraying and showering water where it isn’t wanted. At the end of the hose less than a desired amount of water is being dispatched.
This means that the brakes on growth have to be removed. Leading indicators of success should be identified and a monitoring system in place. This might mean sales calls made, responses to advertising, and so forth.
The organization’s business model needs to support the growth. In some companies, this might mean changing from what is "usual and customary" to something dramatically different. For example, a company that is used to doing work for clients, invoicing them and waiting for payment of 60, 90, or 120 days might change to enforcing a policy of requiring clients to provide a sizable deposit before starting any work. This might mean seeking a different kind of client base.
To that end, before the decision and commitment is made to grow, the ideal client has to be identified. Unless this crucial step is taken, valuable resources could be wasted as the company may do business with just any prospect. The problem is that just any prospect may not be able to afford the company’s product or services, may not be credit worthy, and may over commit to purchases it does not need or cannot handle.
Part of growing is an understanding and acceptance of the best methods for marketing for new clients. Without a plan based on research, it simply becomes guesswork, which can be costly to implement, with no guarantee of a positive return on investment on the expenditure.
Specific goals need to be set at critical juncture points in the marketing process. It isn’t enough to say "We need more clients. We need more revenue." SMART (specific, measurable, actionable, realistic and time-bound) goals need to be established and monitored.
Having a system of accountability is important, if for no other reason than to keep the marketing program on the path of success. At any point the progress can be measured to the action and resources expended, providing clues as to what is working and more importantly, what hasn’t, isn’t and won’t.
Last, does the organization have the right people in place to execute the marketing and sales programs that will generate growth? Too often it is assumed that someone who was previously successful in another role or in another industry or segment can make the leap without problems or hiccups.
Growing an organization is exciting and rewarding; just make certain that a realistic plan is in place before starting the process and monitor progress regularly. The old adage of "an ounce of prevention beats a pound of cure" is particularly true when it comes to growth.
About the author: Kenneth W. Keller is President of Renaissance Executive Forums, which brings business owners together in facilitated peer advisory boards. Contact him at 295-6892 or KenKeller@sbcglobal.net. His column represents his own views and not necessarily those of The Signal.
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