Growth Curve Lessons Learned
Early on in my career I had the pleasure of working in a fast growing corporation that doubled its revenue to a billion dollars in six years.
From that experience in the trenches I earned my stripes. Since business growth appears to be in style once again, let me share four key takeaways that might make your business growth easier.
The first is that growing a business takes capital and financial savvy. Setting aside the increased payroll costs when new people are hired, spending to satisfy new clients and delivering products and services takes additional cash.
Without the ability to financial ability to invest in the future, all the plans in the world won’t help. What makes a huge difference is having top internal finance people, smart management and connections to lenders who are open to hearing a story of past and future success.
The company and all the managers at my employer became extremely financially literate during this time. Decisions were made with profitability, not volume, in mind. Investment decisions were openly debated before being made. Financial reporting was enhanced to the point were the books were closed within just a couple of days after month end.
The second is that not every employee is going to be able to handle the increased responsibilities and output required to successfully handle what growth comes in the door.
In my situation, the company had chugged along in slow motion for decades and many long term employees, some of them managers, did not recognize that their leaders were doing more than just talking about more rapid growth. The process has moved along to planning and building infrastructure to handle a growth spurt.
In the run-up to what was planned, key professionals were brought in that had “been there and done that” elsewhere to manage expansion. This was not hidden from anyone; however, some employees never thought it was any more than just wishful hiring.
Once leadership hit the gas pedal, it became clear who was pining for the “good old days” of a 9 to 5, long lunches lifestyle and those that understood they would be “driving home in the dark” defined as long days, weekends and plenty of nights away from home.
The third was that everyone was expected to take new responsibilities and an increased workload. Great pride was taken annually calculating revenue per employee as a productivity measurement. It was not a surprise to hear, year after year, that my privately held employer was considerable more efficient than all companies on the Fortune 500 list.
To pull that off, experienced managers and high potential employees were given opportunities to take on assignments where their talents and strengths could be fully utilized and their capabilities expanded. People were not thrown at problems; intelligent people were told to “make it happen with what you have” and they were required to use creativity to achieve goals.
This provided opportunities to learn and grow. Mistakes were made, some costly, and it was a confusing and disorganized place to be employed because change was constant. I soon recognized that if I did not like my boss, all I had to do was to wait six months because I would be working for someone else. But everyone had a sense of belonging and more importantly, purpose.
The fourth takeaway was that the company could only have one dominant focus. In many companies today, all decisions made are based on financial metrics. In others, the legal department has the final say. In some companies, all departments have input and the strongest one, the one with the compelling argument wins.
My employer was driven by sales and the rest of the departments and employees were all considered “sales support.” That did not mean that sales could make promises that could not be kept; it did not mean that sales could sell below cost so that commissions could be paid to everyone while every box that was shopped out was sold at a loss.
It meant that the company was focused on profitable revenue growth and that selling, delivering and taking care of the client was the highest priority of every employee. If you did not accept that the company was not a good place for you to work. You did not have to love the product, but you needed to take care of the clients better than any competitor could.
Growth is exciting and challenging. At the heart of it is having a compelling story to be sold both internally and externally, challenging the right people to do things they didn’t know they were capable of doing, not being afraid to address under-performers and to keep the “main thing” clearly in sight at all times.