The 4 Building Blocks for High-Growth
by Andrew Cooke, Growth & Profit Solutions
High-growth can be risky, but you can mitigate the risk by having focus, discipline and consistency in approach. Yet even then, businesses can fail – even those who prior to embarking on a strategy of rapid-growth were operating successfully. So what can we do to reduce the likelihood of failure?Understand Your Business Model – first of all, let’s be clear about what a business model is not. It is not a business plan. A business model is the foundation on which the business is built, and which answer 3 key questions:
- Who is your customer and why would they buy from you?
- How will you make money from selling to them, and what will you sell?
- What, exactly, are the key things you must do to achieve this?
To do this you need to understand the 9 basic components of any model (this will be covered in a future blog) which include: key partners, key assets, key resources, the value proposition, customer segments, customer relationships, channels to market, your costs and your revenue streams.
Build the right foundation consisting of the right blend of the nine components, and you have a foundation that is not only stable but can support further growth without having to restructure or reorganize the business.
Having the Right People – you need to have the right people in terms of both their aptitudes and attitudes. That is, you want to have people who not only have the necessary skills, but whose values and attitudes reflect those needed by the business. I have seen companies who have suffered from hiring for aptitude rather than attitude – ending up with skilled people who don’t fit in, who alienate employees and customers, and quickly quit leaving a path of devastation for them. I am a great believer in the adage – “Hire for attitude, train for aptitude”. To do this the other way round will put you into a role of managing people’s behaviour rather than the business.
A further point is that you need to plan what skills and capabilities you need to acquire, develop in-house or outsource not just to grow the company but to maintain the growth. New skills and capabilities are needed and you need to be able to identify where and when you need to have them available to utilise
Continuous Improvement – you need to have the right processes in place to support the existing business and which can be scaled up to support and facilitate the anticipated growth. A poor or flawed process will either collapse or create delays and blockages, and this will be compounded by the increase in the volume of work coming through the process.
This needs to be continuously improved to meet changes in the business and its environment. This needs to become part of the culture of the business, with everyone continually looking to improve how they work, remove waste, develop new products and services, and to capture and standardize the improvements on an on-going basis.
Leadership Approach – this will need to develop with the business. At the start the business benefits from a more entrepreneurial approach, however as it matures there is a need for a closer operational and strategic oversight and the blend of skills needed to lead the business change. As such, you need to think if you have the right people, with the right skills and the right approach to run and continue to develop the business. Those who have brought the business through its early stages may not have the skills required to take it further – so plan for succession and development, otherwise your leaders will take the business backwards from their desire to continue to operate in their comfort zone.
What do you see as the critical pre-requisites to support high-growth?
Share your ideas, insights and experience! Share the knowledge, share the wealth!
