How do you know when your business is ready to scale up? Jennifer Bridges, PMP, asks the right questions and gives you practical advice on how to scale your business successfully in this short tutorial video.
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In Review – How to Scale Your Business
What are the common problems of trying to scale a business? Jennifer started by noting two scenarios:
- Overspending and scaling too early
- Waiting too late and not being prepared for opportunities when they arise.
So, like a good joke, the secret to scaling is timing. But how do you know when the time is right? Jennifer offered three criteria to measure if you’re ready to scale your business.
- Look Ahead: What’s the economic landscape look like? Is there a disruption, market shift or customer demand you can take advantage of?
- Fulfillment Capability: Are you getting more orders but don’t have the inventory or bandwidth to fulfill them in time?
- Constraints: Do you have enough team members, inventory, resources, time, etc., to ramp up?
What Steps Do You Need to Take?
If you’ve done the due diligence after asking yourself the above questions, and you’re ready to scale the business, Jennifer suggests following these six steps:
- Evaluate and Plan: You need a strategy, so evaluate the situation fully and plan thoroughly. Do this early in the process, of course, but also do it often to revise as necessary.
- Find Resources: You can’t execute your plan without resources. That means money, which can be sought from investors, or you can reinvest profits back in the company. Then there’s the team to implement your plan. Either hire them or outsource that work.
- Upgrade Technology: To help the process of growth, you’ll want to automate as much as you can, which means investing in new management software and tools that can handle the new scale of the organization.
- Revise Process: What processes are you using? Whatever they are, they’ll need to be retooled to respond to the new scale of the company.
- Increase Visibility: As you grow, you want people to know. Therefore, it’s critical to your success to make sure your services are seen by many.
- Leverage Strategic Business Relationships: Are there strategic alliances that can help you grow? Seek them out and build those relationships.
Areas to Assess When Scaling a Business
What areas of your business do you need to assess to position yourself to scale that business successfully? Jennifer suggested these seven areas:
- Customer Service: You’re growing, which means more customers, and more customers calling. Be sure you’re set up to cover these communications.
- Human Resources: With growth comes the need for more employees. Make sure you’re able to scale up in this regard, while still following all legal requirements and making sure that new roles are clearly defined.
- Marketing: What is your marketing going to look like? What sort of campaigns are best suited for the scaling up of your business, and where will those leads be generated?
- Sales: With a new generation of leads, you’re going to have to reassess your sales force and processes.
- Legal: As you grow, you’ll likely expand into new areas where compliance will have to be studied and adhered to.
- Finance: When and if you get an investment, you’ll need to look at those deal structures and payment requirements.
- Operations: Keep an eye on your administrative responsibilities as you scale the business, and make sure process and operations are suited for growth.
Pro-Tip: Scaling your business is a project, which needs leadership. But strong leaders know they can always use help. That’s where a project management consultant can come in handy to offer you their experience to help chart a successful course.
Thanks for watching!
Today we’re talking about “How to Scale Your Business.” Well, first of all, there’s a book by Marshall Goldsmith that says, “What Got You Here Won’t Get You There.” And it’s true because we have to start assessing different things in preparation for the scale.
So, there are some common problems. Number one, sometimes people scale too early. And what does that mean? When that happens, typically investments are made beforehand and they overspend their budget.
The second case is when they wait too late. And what happens there is, if you don’t scale quick enough and opportunities come in faster than you can handle them, you actually lose opportunities that sometimes you may not get back.
So, how do I know when I need to scale? So there are a couple things. First of all, look ahead. Is there any disruption happening in the market that you need to respond to? What about any kind of market shifts or customer demands?
Number two, fulfillment capability. Are you getting orders more and using up the inventory that you have? So, if you are depleting your inventory and you can’t meet turnaround times, then those are cues that it’s time.
And then third are, look at your constraints. Again, maybe team. You don’t maybe have enough team members to handle the demand. Again, inventory or even resources, whether that’s monetary resources or even time.
So now, let’s look at some of the steps. What are the steps that you need to take in order to scale? Number one, evaluate and plan. Get a strategy. And do this early and often. So, you wanna make sure you have a plan to scale.
Number two, find resources. Money resources. Determine, do you need to reinvest money from the business, back into the business, or, are you in a scenario where you need to look for investors? And that does take time. So we say this process is actually a project in and of itself.
Number two is look at your team. Do you need to expand your team? So, if so, do you need to hire more people, more employees, or, is it a scenario maybe you need to outsource something to a strategic partner?
Number three, upgrade technology. When we start growing and scaling, we wanna start automating things. There are always new tools, new tool sets, new apps out that make things easier to automate.
Number four, revise processes. So, as you grow and scale, you may need to add some processes, maybe you need to revise ’em, and again, automate as much as you can.
Number five, increase visibility. So when you begin to scale you want more people to know about the business and what you’re doing.
And number six, leverage, strategic business relationships that can help you scale.
So here are some areas of your business to assess. Number one, customer support. When we start growing and scaling our business, that makes us think we’re having more customers. And with more customers, generally comes more calls, more requests. So, we wanna be sure that you’re prepared for those customer calls.
Number two, human resources. Once we begin growing and scaling our team, adding more people, come more people issues. And you wanna be sure that human resources requirements that are regulated by the government are met. You also wanna make sure when you do add more people, that you define the roles clearly.
Number three, marketing. When we, again, scale, we look to maybe have more marketing campaigns. What do those look like? And then we wanna be able to do that for lead generation.
Once we start generating more leads, we wanna convert those leads to customers. So, we tend to look at sales. How do we do that? And do we need to add more salespeople, more sales processes? And we would be doing quotes. What do those quotes look like? Or maybe even statements of work.
When we grow and scale, many times we start needing to look at other legal requirements, other compliance, and maybe even things that are happening in our industry that we need to ensure that we’re complying with.
And then number six, finance. Again, if we go to get investment dollars or investors, we need to look at deal structures. And how do those payment terms impact the business?
And then number seven, operations. Making sure our business operations and our processes are set such that it can meet the needs to support all these areas, including administration.
So, If you need a tool that can help you scale your business, then sign up for our software now at ProjectManager.