Every business owner has a big vision for their company and wants to make it happen.
In a recent LinkedIn post, I asked what was the one thing you wish you knew before you started your business? A business owner replied, “Starting a business is easy, but scaling a business is hard”. I get it. You want to move your company forward, but you don’t know how. Scaling is all about people, processes, strategy, execution, and cash.
Last week, we talked about how you can utilize your team (people) to help your business grow fast. In case you missed it, you can read it here. Now, let’s talk about processes.
Many business owners generate more ideas than time or money allow them to implement.
The frustration level is high and often leads to feeling paralyzed or overwhelmed and unsure. Every business owner deserves to have a business with a strong financial future.
- Are your processes in writing? If not, you’re leaving yourself open to interpretation of those processes by your people. Without training for your workforce, new and existing, it’s likely that these processes will be done the way the employee thinks they should be done or the way it was done at prior firms where your people have worked. This can create mistakes in your processes, which will take time to correct, causing inefficiencies in time and money. The sum total of all this can have a significant impact on your ability to scale.
- Most businesses travel at a fast pace, some faster than others. Efficiency measures are often implemented to shorten cycle times. With many construction projects underway and impacted by COVID-19, I imagine general contractors had to shorten multiple cycle times to get projects completed on time. The faster you can make your product or turn your inventory, the more business you can do which increases revenue and profits.
- In the midst of running your business, you may find some ways to improve your business model through improved processes. I have several clients that are looking at sales processes. Enhancing the client experience, expanding products and services or your geographic reach through an improved business model can mean a significant change in your delivery cycle. I have one client who, through improved processes, has increased revenue 20% last year and is well on their way to another 20% this year. Improved processes have caused their average order to increase by about 30%. Since they’re doing bigger orders, they’ve created capacity to do more orders by going up market.
So, how much is having undocumented processes limiting the potential growth of your businesses? One at a time, record the major steps in each process. Follow a linear or chronological approach. Make sure these processes are followed by everyone.
Bill McDermott, The Profitability Coach
If you want to make sure not to miss a blog post, visit our homepage and click or tap the “Subscribe to ProfitSense” button.