The Business Journey | Extraordinary Business
Business growth stages, different methods and why you should understand which stage your business is on
Businesses typically go through a number of stages throughout their existences, from startup through a “surviving” phase, a bit of a plateau, or even a decline, then, with some effort, the business might reach a point where it is “sustaining,” where things are pretty much under control and the owner can begin to consider options.Typically, the next steps of the business could involve purchasing other companies, being purchased by other companies or simply maintaining the business until the leadership simply doesn’t want to run it any longer.
Like the growth of a child, each phase is unique; each one has its own set of challenges and opportunities. Many businesses get stuck in that “struggling to survive” mode. Others may move rapidly forward, only to slide backward or even go out of businesses as a result of changes in economy, market, industry, competitors, technology or public policy.
The $64,000 question is: “Where is your business and what will you do next?”
There are a few ways to look at this:
Look at how the business is being managed. For example, if your business is generating somewhat regular revenue, but doesn’t operate without you, you are beyond the “startup” phase, but aren’t exactly able to make the investments you might like to in the business, so you are probably in the “survival” phase. However, if you are generating predictable revenue, focused on growth, how to reduce costs, take on more customers, are delegating tasks, etc., you are probably in the “sustaining” phase.
The Harvard Business Review published an excellent article that goes deeper into this method.
Another way to look at this is similar to how you might look at your own existence; how the business relates to the world. Paralleling with Abraham Maslow’s hierarchy of needs, the first three phases of business growth – survival, safety and sustainability, the business is probably focused on just getting things up and running, and beginning to get a flow for how things should operate. The next phases of growth might be focused on refining the business activities further, integrating and communicating more predictably and beneficially with the outside world, understanding the value exchange (money for products or services) and making strategic moves in order to gain market share.
Over the next month, we will dive deeper into this thinking. At the end, there will be a quiz so take notes. (Just kidding!)
In either case, understanding where you are can help you in a number of areas, such as:
- Benchmarking – by understanding what the next phases of growth are, you can begin to incorporate practices that will move you toward the next phases, versus doing the same things and hoping for better results.
- Expectations – understanding that there are different cycles and phases of growth and that a lot of businesses go through what your business is going through can be motivational or keep you focused, but at the same time, it may assist in your decision-making process
- Prioritization – sometimes, as business leaders, the cart gets put before the horse, so the business ends up lopsided in some way, such as being process-heavy without the support to ensure that the other components of the business (such as sales) is being handled well. Businesses require a balance of inputs in order to produce the desired output.
Growing a business doesn’t mean that the business needs to grow into a multi-national or multi billion dollar business. What you want to do is think about what the end zone might look like and focus on getting the business there. If it is to be a lifestyle business that will allow you to run it and do other things on the side, that is one story, whereas if you want to build it so it can run without you, that is a different one.
Regardless of the end zone, if you leave it up to hope or chance, you may find that your business never meets your expectations; it will never become extraordinary. Setting specific goals and driving the company toward them, one step at a time, will increase the likelihood, multiple times over, of reaching them.
Rick Meekins is the Managing Strategy & Operations Consultant at Aepiphanni Business Consulting, the trusted advisor for business leaders who are seeking forward-thinking solutions to help them plan for and navigate through the challenges of business growth. Our entrepreneurial multidisciplinary team works with clients to develop differentiating solutions and provide direction focused on lasting, strategic results. We exist to help our clients CREATE | DESIGN | BUILD extraordinary businesses.
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