Scale: 7 proven principles to grow your business and get your life back, by Jeff Hoffman and David Finkel, two consultants that have worked with hundreds of small and medium sized businesses, sharing their insights from those experiences.
The Big Idea
A truly scalable business has 2 key ingredients: systematized operations, and predictable sales. First – operations need to be systematized so that the business doesn’t rely on its owner, and someone can be brought in without the business missing a beat. And second – a deep understanding of why your clients work with you so you can position your company uniquely and grow top-line predictably.
But almost no business starts this way. So the authors have developed a roadmap to guide entrepreneurs from a startup to a company that inevitably relies heavily on its owner; and finally to an owner-independent and high-growth company that can be sold.
How it works
On the operations side, most entrepreneurs naturally resist the change from doing everything themselves to delegating to new hires. Because as soon as they delegate quality suffers, clients get upset, and the owner retrenches. The issue is that they tried to scale too soon, before they had the right systems and controls in place. The key is to streamlined business processes, organize each step so a new hire can execute with predictable results, and put the right controls in place so you’re not flying blind.
On the sales side, most entrepreneurs are too deep into the day-to-day that they haven’t taken the time to really understand why their customers are doing business with them. As a result, the business is more reactive than proactive and can’t grow.
Take for example, the company bringing you these video summaries. We’re selling corporate animations. It used to be that clients would call us up for ad-hoc projects. So every month we’d start from scratch, with no idea of our staffing needs or the true underlying demand so we couldn’t hire sales people to grow. Once we talked to our clients and figured out that our videos played an important role in helping them win million-dollar RFPs, we could customize our offering to provide more value for them and become an integral part of their process.
Along your journey to building a scalable company, you will face serious hurdles that the authors call your limiting factors. Their roadmap can guide you to push them back. Struggling with your sales capacity? How do you come up with 10 ideas to deal with this limiting factor, and how will your organization tackle it?
Every business starts with many operational and sales constraints. What are yours, and how can you eliminate them, one at a time?