I have often heard business owners decry “the politics” they see as being inherent in bigger businesses. The implication is clear: smaller businesses are free of that kind of skullduggery and self-seeking.
The fact is that many business owners get stuck because they don’t understand that, past a certain size, they need to include political thinking in their growth plans.
Most owner-managed businesses get stuck once they have grown to between 5 and 25 employees. They reach the limit of what the owner can manage on his or her own. There are only so many employees, customers, sales and transactions that one person can deal with.
Think of it as reaching your plate-spinning capacity.
The unfortunate fact is that most businesses (over 99.5% according to the ONS) get stuck like this – even when the market opportunity for more growth is there. They reach this revenue ceiling and there they stay. It doesn’t matter what the owner does, how many hours they work, what fancy marketing they invest in. They have grown as big as they are going to grow.
Of course, a few do grow past this – they must, or all we would have is small businesses. This tiny fraction of business owners realise that continuing to grow requires them to manage their business differently.
Stuck businesses consist of the owner working long hours trying to decide and do everything plus some employees being given tasks and micro-managed. Scalable businesses are quite different. They consist of systems being operated by employees while the owner does very little.
One way to achieve this is to follow The Scaleup Formula©:
Standardised Processes x Accountable Employees x Routine Reviews = Scalable Business
Standardised processes have a clear start and end, a single measurable output or result and a single owner. They have a standard set of metrics covering inputs, output, backlog and defects. They are defined in such a way that the responsibility for results can be delegated.
Accountable employees are autonomous and take responsibility for the results of their processes.
Routine reviews develop management understanding and skills in employees whilst making the responsibility for results real to them.
Over time, The Scaleup Formula© builds a core of motivated and able employees around the owner. In fact, it has developing this core as its prime aim. It is a political process. These employees are fertile ground for improving planning and performance in the business, developing new leaders and eventually creating with the owner that shared purpose that drives great businesses.
If you’d like to know more about applying The Scaleup Formula© to your business then click here.
