Grow to GROW!
Most people associate “business growth” with top-line performance. In fact, there are two kinds of “growth” in business. Growth in the overall financial performance of the business and growth in the organization at large – its culture, people, systems, skills and structure. Organizational growth should be seen as leading and critical to long-term financial success of any business. In other words, the need for organizational growth should be anticipated and acted upon as though financial growth i.e. the performance of the business is dependent upon it.
Investopedia® reports that one of the most common reasons why small businesses fail is because the top-line grow rate exceeds the corresponding rate of organizational growth needed to support demand. This scenario is the reason why small businesses hit “glass ceilings” and are sometimes well advised to temper top-line growth ambitions in the short-term, to better position the organization for future, long-term, sustainable growth. Some common symptoms of organizational stress that reflects the need to bring greater focus on organizational growth, include: workplace chaos, a deteriorating cash flow position, a loss of orders from previously loyal customers, a reduction in customer retention rate, the loss of key employees, poor teamwork, poor “attitudes”, and more.
At 1Direction, we advocate the use of the 6 STEPS to a Great Business framework for planning and managing organizational growth in a way that is leading and consistent with the future financial growth objectives of any business. The 6 STEPS represent the need to continuously:
- Master critical skills in all key functional areas of business.
- Define your Niche in the market place and refresh your offering in a way that is aligned with customer needs and to maintain competitive advantage.
- Leverage the assets of the business by developing systems and routines that improve efficiency and profitability.
- Optimize the effectiveness of your Align functional roles and activities with the future needs of the business. Get the right people in the right seats.
- Maintain Synergy between functional roles and the goals and activities of all employees to keep people moving in a common direction.
- Dedicate more time and attention to building strong relationships with external partners to get better Results for the business.
Opportunities for organizational growth should be targeted and supported at a strategic level during annual planning meetings with key business managers and/or trusted advisors – ideally, with meaningful input from employees or teams. Annual objectives for organizational growth and strategies for achieving them should be established during the last quarter of each fiscal year and coincident with the business’s planning and budgeting process. And, since the level or rate of organizational improvements can be difficult to quantify, we recommend the use of a Business Scorecard, consistent with the 6 STEPS framework, to identify specific opportunities for improvement and to quantify progress achieved in successive years.
Contact your 1Direction ActionCOACH today to assess the relative state of your organization and its readiness for sustainable financial growth. Click here for more information.