Serial entrepreneur Marcus Ho breaks down the arduous journey of growing your business with these insights
Having successfully exited two companies which he started, author of national bestseller Social Payoff, Marcus Ho, quickly realised that fast-growing startups face the common challenge of lack of financial capital. To fill this gap, he joined New Union, Singapore’s largest business financing platform, to work with emerging startups on their financing needs.
When a new business goes out in the market, its primary goal is to become successful and scale up operations. It is a challenge to get every individual on the team to go in the same direction, in terms of growing and scaling up their operations.
In this infographic based on Verne Harnish’s latest bestseller Scaling Up, here are 10 ways to quickly scale up your startup.
1. Learn to trust others and let go
At the time a business starts operations, it is fairly easy to run. The employees are still limited, dealing with a minimal number of customers.
The level of difficulty grows as the number of personnel grow and the work undertaken by these individuals gets more specialised. At this time, it is not possible for the business owner to look after every aspect of the business.
Those who try and micro-manage various activities are only going to threaten the growth prospects of the company. The fact is that it must be the endeavour of every business owner to hire individuals with the skills that will contribute to the business’s growth.
If the company is to reach its growth targets, it’s important for the business to give the workers the freedom to realise the goals that have been set for them.
2. Hire ideal workforce
It’s just what Steve Jobs of Apple once said, “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.” During the hiring process, the business owner looks for qualities much like him/her in the prospective individual. The fact is that what he needs to look for are qualities that show a different side from his own.
3. Hire a coach
Entrepreneurs can get separated from their goals, so it’s usually a good option to get a coach who can work as a sounding-board for the company’s course of action, as well as the crucial measures that need to be undertaken over the course of running a business.
A coach can even be someone who has experience in managing his own company and who’s available to give guidance that will keep the business owner motivated.
Experienced coaches might sound costly to small businesses but if they give sound advice, they could be worth the cost
Regardless, it is imperative that a company that wants to scale up operations gets some external sources of advice. These people can prove invaluable and may often be the single reason for the continued development of a new enterprise.
4. The importance of council
Business owners trying to level up their operations should seek advice from all sources available. As a matter of fact, setting up a council by businesses is highly suggested by Jim Collins, the writer of Good to Great, a seminal work on management.
Councils are basically a tool to gain understanding about major concerns that can affect the business. The council members are primarily key people in the management team and meet at regular intervals when members have the opportunity to share their insights on areas that they have particular knowledge of.
Importantly, the council does not aim to build consensus, knowing that judgements taken on this foundation may not be the ideal strategy forward.
5. Learning the four E’s of marketing
Shortened product life cycles have made it essential for companies to start considering the experiences they are providing instead of the goods they’re promoting.
This may ensure that they could suitably adjust their products to keep in touch with evolving consumer demands.
The outlet or the ‘place’ has been replaced by a location favoured by customers. Moreover, online purchasing is more common nowadays and the digital world’s impact on this facet of selling your business is imperative.
One of the important factors that the marketing department has to focus on is the price, among many others. A business has to recognise how to get consumers to give it their attention, their engagement and their permission.
Word of mouth, being the oldest form of persuasion based on evangelism to make it more effective, ought to be combined with the newest strategies, social networking and web 2.0.
Organisations must shift from the four Ps (price, product, promotion, and place) to the four Es (emotions, experience, engagement and exclusivity) if they are planning to be successful in scaling up their business.
6. Adoption of the correct strategy
The strategies an organisation has to take to yield the first million in profits differ from what is required to arrive at a multi-million level. Profits generated per employee in huge firms are much higher in comparison to smaller organisations.
The reason for this is the approaches and set techniques employed in major businesses. If a smaller company wants to size up its operations, this is an essential aspect to take into account.
These techniques let employees do something by themselves without having to lose time referring the problem to coworkers or relearning the processes once again.
7. Effective execution
Cross-functional groups can accomplish surprisingly insurmountable objectives by implementing the Scrum principle popularised by Jeff Sutherland.
This involved method necessitates team members to have a daily huddle and compile designations of responsibilities to be completed.
A team adhering to the Scrum principle is different from a normal workforce as it is self-managed, has a continuum of team membership and commitment to each particular job. Adoption of the Scrum principle has created amazing results for businesses attempting to grow their operations.
This works to concentrate the initiatives of every single person concerned with a problem and presents the direction required for the accomplishment of the desired goals.
8. Adequate funds
The importance of having cash in the business cannot be over stressed. It is the lifeblood of any company and its survival, not having this is not possible.
Many organisations expand quickly but fail to keep track of the inflow of profits. If growth is at the cost of mounting debtors, it might be safer to keep the level of sales lower because every single sale might be resulting in a depletion to the company’s cash position.
It’s vital that a firm monitor revenue at every single stage of its expansion and get the tools to measure the impact of its actions on the money available within the company.
9. Get customers to pay upfront
When a business can implement advance payments from buyers, it can supply the liquidity required to grow operations. An example of which is Amazon Prime, in which the online store is able to finance its expansion making use of the US$75 it accumulates upfront from the buyers who prefer its scheme.
When a certain business does not have a practice of clients making advance payments, an effort must be developed to raise the funds collected.
Every organisation, in particular, one growing rather quickly, would need to keep an eye on its monetary status. Companies which lose this focus may very well be setting their business up for crisis anytime in the future.
10. Get a one-page strategic plan
Many companies use Verne Harnish’s book Scaling Up which speaks about a one-page strategic plan. Implementing this basic product may actually provide direction to a company aiming to grow its operations.
The knowledge that allows someone to become an effective businessperson includes a deep sense of self-belief, drive and passion. In the absence of these characteristics, it’s highly improbable that a businessman will be able to grow his company in the right direction.
However, as the company develops, a number of different skill sets are necessary within the organisation. The businessman would have to adapt and understand how to trust in his staff to allow the company to accomplish the next stage of development.
Businessmen who learn to make this move will become successful in their attempt to levelling up their business.
The views expressed here are of the author’s, and e27 may not necessarily subscribe to them. e27 invites members from Asia’s tech industry and startup community to share their honest opinions and expert knowledge with our readers. If you are interested in sharing your point of view, please send us an email at writers[at]e27[dot]co
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