If you own a business, you know that growth is necessary to prevent stagnation and eventual closing. Therefore, no matter what stage you are in, business growth needs to be a priority. However, every stage of business has unique growth challenges that you need to overcome.
This is the final stage of business. When a company reaches this stage, it either needs to innovate and eliminate inefficiencies so it can still compete in the market. The key is to control the incredible financial increase your company has gained while retaining the competitive advantages you may have as a smaller company, such as entrepreneurial innovation and flexibility. Your focus should be on eliminating inefficiencies through proper management and financial tools, including budgets and strategic planning. However, you want to continue to encourage continued entrepreneurship and gain key talent so you continue to grow and avoid ossification.
In this stage, your business is primed and ready to take off. To promote this growth, you need to delegate managerial responsibilities so that you can focus on strategic and operational planning and execution and guidance and they can manage individual departments and their performance. You may have to adopt a high debt-equity ratio because this growth requires high influxes of cash that don’t deplete your cash flows. You need to have strict control over your expenses and investments.
At this stage, you have officially accomplished success. Now, you need to decide whether you exploit this success on expansion. Your company is stable, so you can pay your operating costs every month and still have cash left over for savings and reinvestment.
Therefore, you can disengage, remaining the same size and market penetration level. You hire managers for individuals whose goal is maintenance, not growth. Your goal is to avoid cash drain. Defined departments have been established as well.
You can also pursue a growth strategy during this stage. To grow, you hire managers that seek growth rather than maintenance. You pursue operational and strategic planning for every part of the company, maintaining your involvement in each area.
Your planning is done, and you have opened your doors. You seek to produce and deliver products or services to your customers, but you need to obtain them first. Your task is finding enough money to cover the startup cash demands. As the owner, you are responsible for managing everything.
No matter what stage your business is in, you have important tasks. If you seek business growth, investigate the challenges and opportunities of your business stage.
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