We’re finally growing and looking forward again! I know the business needs to change as we grow. Now I fear that it’s the things we don’t know that are going to get us into trouble. How do I impart knowledge I don’t have, and anticipate needs in areas where I don’t have experience?
Keeping a business ahead of inflation means annual growth between 10% and 15%. That puts the business on track to double revenue every 5 – 8 years.
It’s up to the owner to infuse new knowledge in every area of the business, in order to sustain a steady growth track. As the company grows, problems become more complex. Challenges are different. Businesses, just like people, all hit a Peter Principle – the business maxes out what it knows, and begins to stall unless the owner takes action.
Break the business down into disciplines: I call this the Six Sisters: Sales, Finance, Marketing, Operations, Human Resources and Leadership. Instead of having the entire business sit on the owners’ shoulders, spread the load. Look at the business in sections. Assign one person to be responsible for each area. Increase depth and breadth, as the team works to build the business.
Not sure how to help grow skill in each area of the business? There are four primary ways for a business to gain new knowledge. Each choice has positives and negatives.
Option 1: Ask people already in place to get their own education. Be aware that people who get an education on their own often move on to new jobs within a year or two of completing the education cycle. Be prepared to deal with the reality that the load of study diverts attention from work during the education cycle. Make sure your company can employ and reward the individual at a significantly higher level, once their education is completed, or be prepared to replace them when they’re ready to move on.
Option 2: Hire experienced personnel. New executives can bring new energy and knowledge, but may have trouble earning the trust and respect of their direct reports and peers. They may overlook the value of what’s already in place, and make wholesale changes that cause existing employees to lose focus. Do a careful assessment of what skills are needed for your company. Then do a lot of reference checking to be sure your candidates have experience successfully bringing the skills you need to the table in a new organization.
Option 3: Outside experts can provide limited cost proposals for specialty work that is not core to the company. Accounting and legal are 2 classic examples. Make sure your current providers have experience working with companies like yours that are 2 – 3 times your company’s size. This means they can guide you through challenges you’re about to face. If not, it may be time to focus on upgrading skills.
Option 4: Hire teachers to work with your organization. Use the training process to unify people around shared skill development. Be aware that any development process will include some disruption. Allow time and budget for experimenting as your team works on increasing results. You may find some people get left behind, be ready to deal with the fallout. Make sure that the teachers you hire are qualified to do what you need.
Ask you team of six managers to take an in-depth look at each of the six areas of the business. Make a list of development needs and prioritize from critical to nice-to-have. Lay out timing – don’t try to attack every area all at once. Decide which learning option is most appropriate for each area. Develop a company training plan, that the management team can use to stay on track.
As you go through this development process, your job, as owner, shifts. You go from working in the business, to planning and managing the future growth. You’re working on the business for a portion of each week. This is exactly where you need to be to insure the company’s longevity.
