Growing a business is tough. You have to find and retain good people, get new customers in through the door, source investment or commercial finance to fund your expansion plans, and be innovative and flexible enough to take advantage of new trends. All whilst ensuring you’ve got more money coming in than is going out and that the books are balanced at the end of the month.
It’s a lot.
But here’s the thing. It’s all about growing in the right way, by putting measures in place that will support your business as you expand and give you the tools you need to excel.
In this blog, we will outline the top six things that, to us, signal that a business is growing up. By this, we mean that they are leaving infancy behind, along with its haphazard approaches and make-do-and-mend processes, and approaching adolescence – the phase in which businesses begin putting in place the grown up infrastructure they need to support their growth and reach a new phase in their development.
So, what are those six signs? Well, in our experience, grown up businesses:
- Don’t micromanage
- Invest in software that will grow with them
- Implement scalable processes
- Don’t have knowledge silos
- Know when they need help
- Have thought about the end game.
Enough with the introductions – let’s go!
1. Grown up businesses don’t micromanage
When a business is just starting out, it is likely that the owner or director will be doing a lot of the work themselves – usually out of necessity more than anything else. As their business grows and they take on new people, however, many business owners may still find it hard to ‘let go’. There are a few common reasons for this:
- They think they can do the task better themselves
- They are afraid that the delegee will fail
- The task process has not been properly communicated or documented
- They fear the loss of control that may accompany the delegation of the task
- They feel it would take too much time to train somebody else.
It’s completely understandable why many business owners and managers have trouble delegating. They have put their blood, sweat and tears into their business and don’t want anything to go wrong.
However, hoarding tasks or micromanaging will inevitably stunt business growth. That’s because this type of behaviour depends on the business staying small enough for the owner to continue overseeing everything that’s going on. That’s why grown up businesses don’t micromanage; it is physically impossible for a business owner to keep doing everything themselves and simultaneously get their business to the place it needs to be to grow and fulfil its full potential.
2. Grown up businesses invest in software that will grow with them
We’ve been supporting businesses to professionalise their financial management for over three decades, and if there is one thing we cannot recommend enough, it is to invest in systems and infrastructure that your business can grow into – not out of.
To explain what we mean, we’ll take an example from our own business. When we start working with a lot of our clients, they are still using entry-level accounting software like Quickbooks, Xero or (the horror!) a Microsoft Excel spreadsheet. The trouble is that, once a business gets to a certain size, these entry level solutions start struggling to keep up.
Enter iplicit, the cloud accounting software for growing and mid-sized businesses, which we use for all our clients. It’s likely that when we initially migrate a client across to iplicit, they will not need all of the functionality it offers. They might not even need the majority of it. But, as they grow and their needs become more complex, iplicit’s functionality really starts coming into its own. Suddenly, our clients are asking for more in-depth and complex management accounts to facilitate their decision-making processes, or perhaps they’ll start using iplicit’s automation facilities to drive efficiencies in their business and smoothly scale up their processes.
As the saying goes, you have to speculate to accumulate, and grown up businesses will see the purchase of a solution like iplicit as an investment, rather than a cost. They are open to investing in technology that will support them not just now, but years into the future.
3. Grown up businesses implement scalable processes
When we start working with them, many of our clients are growing fast. But they’re growing too fast for their existing systems and processes to cope with. In fact, they’re barely hanging on from day to day and things feel out of control.
Almost invariably, they’re not coping as well as they should be because their operational processes aren’t scalable. Many of these processes were put in place when the business was established and are now completely unsuitable for a larger organisation.
A grown up business, on the other hand, has scalable processes – i.e., processes that can cope with increased volume and activity without a corresponding increase in workload or cost.
A scalable process:
- Is standardised across the business
- Is documented
- Is decentralised – it doesn’t rely on one person’s knowledge
- Can handle increased volume
- Doesn’t create bottlenecks
- Is often facilitated by software and automation
- Doesn’t increase in cost as the business grows.
One of the best ways to implement in scalable processes is to invest in systems and software with the capacity to cope with an increased volume of work as your business grows – such as iplicit.
4. Grown up businesses don’t have knowledge silos
Picture the scenario: Graham from the accounts department is on holiday and the team has suddenly realised that nobody else knows how to issue an invoice.
This is an example of a knowledge silo. When a business is in its infancy, there are many reasons why knowledge silos can develop:
- Processes aren’t properly documented
- There is no centralised system for information sharing between individuals and teams
- There is no formalised onboarding process for new personnel
- Different departments don’t communicate
- A competitive culture discourages information sharing
- Company leaders fail to communicate with employees about the company’s overall vision, objectives, values and processes.
Breaking down knowledge silos is key to building a grown up business. Better information sharing can reduce the need for unnecessary meetings, minimise task duplication and foster a better working relationship between individuals and teams.
5. Grown up businesses know when they need help
It can be hard to admit that you don’t know it all. But every business owner will at some point run into a challenge that they can’t resolve alone. Or, we should clarify, a challenge that they could try to resolve alone, but don’t really have the expertise or time to tackle satisfactorily.
Perhaps they need more customers through the door but don’t want to ‘waste’ money on marketing. Or maybe the financials are becoming ever more complex, but they are still using the same part-time bookkeeper as they were when their turnover was a fraction of what it is now.
In cases like this, businesses usually take one of two approaches:
- They’ll baulk at the cost of hiring new staff or investing in new tech, and continue doing exactly what they are already doing.
- They will recognise that something needs to change and take steps to invest in the future of their business, whatever that might look like.
A grown up business is capable of looking beyond the immediate cost of hiring in new expertise or outsourcing to a professional agency, and understand that this investment in their business could unlock growth opportunities that they would otherwise be unable to access.
6. Grown up businesses have thought about the end game
When you first started your business, you were probably so focused on getting to the end of the day, the week, the month, and then the year intact that you had no time to think about what it was all actually for.
There was no plan for the future, no end game in sight. You were just focused on securing the next sale, finding the next client or meeting whatever other challenges that particular day may have held.
This way of working may suit you in the here and now, but what about 10 years from now? 20 years? 30? Having an endgame plan will not only allow you to understand what you actually want to get out of all this hard work you are doing; it will enable you to set defined goals and objectives to work towards and add purpose to your business endeavours.
So, although it may feel very early to be thinking about the future of your business without you in it, starting to plan now means that you have years to prepare, slowly steering your business into the best possible position to succeed.
How you can grow up, too
At Insight Associates, we specialise in working with businesses who want to grow up, but perhaps aren’t quite sure how. They understand that things need to change and that they are outgrowing the financial systems and processes they have relied on thus far. They are willing to put in the time and investment required, and they accept that things will have to change fairly drastically in order to get them where they need to be.
iplicit is a key part of that process, representing that significant step up in both functionality and reporting that our clients really need to move forwards.
As painful as it can be to feel like you are losing control (even if the reality is quite the opposite) and to let go of previous systems and ways of working, what our clients get back on the other side is so much better.
So, if you’d like some help in becoming a grown up business and are ready to take that leap of faith, then Insight Associates is here to help. To discuss our services and your business’s needs, please do call us on 01279 647447 or email info@insightassociates.co.uk.