You’re ready to grow your business – maybe you’re planning to expand, add new services, or acquire some of your competition. Either way, it’s is a big shift that requires you to transform the way you do business today. Are you ready? Have you properly prepared for the change? Do you know the five business transformational pitfalls that can derail your success?
Business Growth Doesn’t Come Without Growing Pains
I recently had an interesting conversation with a friend and business colleague. She called to tell me that the company she worked for had made its first acquisition. They were about to merge with another leading company in their industry that would double their size. Literally, overnight.
I listened as she told me how this business growth opportunity was going to lead to their continued success and move them to number two in their industry. She was full of excitement. I could hear it in her voice. I could feel her energy buzzing through the phone.
However, I was immediately concerned by how quickly this acquisition was taking place, and I didn’t get a sense that they were properly prepared for the scope of the change. She wasn’t the least bit worried though. She insisted this was going to be a great move for the company.
I listened intently. Though I felt bad about it, I couldn’t help but smile. I knew what would happen next – that the honeymoon phase wouldn’t last long.
5 Pitfalls Of Business Growth
- Infrastructure. Organizational and IT infrastructure are both critical to the success of any business. This is the first area that needs to be carefully considered when growing your company, as this can pose threats to the speed at which you are able to meet customer demands. If organizational or IT structure is not clearly defined and functioning at every level, the company will struggle to maintain its momentum. This is especially true for companies that experience rapid growth in size. Things to consider:
- Will the current organizational structure be effective in the future state or is a new structure necessary to support the company’s growth?
- Will the current IT infrastructure support the transition or do changes need to be made ahead of time to reduce the loss in productivity?
- What framework is necessary to support associates as they move through the transition? For example, implementing an intranet site to provide associates with a platform where they can ask questions and get answers can help them move quickly from a state of confusion to a state of action.
- Communication. This may sound obvious but it’s often the first area to get overlooked during the planning phase. Good communication plans can make or break a smooth transition and should be carefully drafted by leaders well in advance. These critical touch points will help everyone in the organization understand why the change is important in helping the company meet their mission and goals. How associates will be personally impacted by the change. And what to expect during the phases of the transition. It’s important to remember that people will fill in the gaps of what they don’t know with their own stories (good and bad), so leaders need to ensure they own this valuable real estate of the mind through their communications which should be:
- Transparent and open – share what you know about the change to gain trust and understanding.
- Story related – people emotionally connect and relate to stories, so be prepared to tell a story as you explain why and how the change will occur.
- Timely – The information you share in your communications will help people prepare for the change so make sure you are sharing well in advance of the changes to give people time to adjust.
- Repeated multiple times – change ignites strong emotions in people which can interfere with their ability to process and remember new information. You should plan to repeat important communications 6-7 times and across various mediums (audio and visual).
- Processes. Organizational processes are the glue that holds your business together. They directly correlate with your company’s efficiency and productivity. What works today may not be what’s needed after the transformation takes place. Overlooking any necessary change to your processes to support this shift can be detrimental to your company’s success, so be wary of anything that disrupts the flow of doing business. Leaders should intentionally ask themselves what changes are needed in their processes to support the change.
- Is the way you do business today, conducive for the future state? If not, what process changes are needed to set the organization up for success under the new structure?
- What process changes are needed to help associates efficiently serve the customers once the change is made?
Once you’ve identified what needs to change, develop a plan well before the transition to make sure that everyone understands the new process and how to implement it. If a drastic process change is required, it may require additional communication and training as part of the rollout plan.
- Culture Immersion. With mergers and acquisitions or rapid growth that require you to hire external talent, you are bringing a new group of people into a well-established culture; however, these new associates came from a very different culture. They will initially resist the new culture since it is unfamiliar to them. This can be a difficult transition for both sides. It can also strike discord at a time when you need everyone to be closely aligned with your vision.
You can assist with the process of cultural immersion by making the new associates feel welcome and valued while reiterating the company’s core beliefs and values and how these translate to their new culture. Intentionally reinforcing this will help them adopt their new culture more quickly – or indicate that they may want to look for other opportunities if they do not feel it’s a good fit.
- Training. Most organizational transformations require some degree of training to get associates quickly up to speed so they can maintain forward momentum. Things to consider:
- What skills are required to reach future state and what are the gaps that need to be addressed?
- Based on their current skills, do you have the right people in the right roles?
- Is any training required to learn new processes before they roll out?
Based on your evaluation, work with your HR department to build a comprehensive training plan to facilitate the transition.
The Rest of The Story
It had been about three weeks since the phone conversation with my colleague about the acquisition, and somehow I knew it was her calling before I ever looked at my phone. When I answered, I was greeted with a very different tone in her voice. Her previous excitement had been replaced with despair and frustration. “This isn’t going so well,” she admitted. “In fact, it’s been miserable. For everyone. Especially me,” she added with a weak laugh. As I suspected, improper planning had plucked the rose-colored glasses right off her face.
I asked her questions to understand what had gone well and what wasn’t working. I wasn’t surprised by anything she revealed, terrible communication, broken processes, organizational confusion, lack of IT structure to support the change, major culture gaps, etc . . . I’ve witnessed many other companies go through similar struggles as they grow their business.
I shared my perspective on what she was experiencing to help her cope with her situation. I explained that things will eventually get better as her company works through the hurdles of the transition.
I secretly wanted to tell her with the proper planning on the front end, they could have avoided a lot of the issues they are currently experiencing. But I’m not the kind of friend who takes pleasure in saying, “I told you so.”
No matter what type of growth plans you have for your business, a transformation will always involve some growing pains. You can reduce these setbacks through proper planning ahead of time. By determining how you will handle the challenges of infrastructure, communication, processes, culture immersion, and training, you will build a transition plan that helps you reduce the inevitable drop in productivity and associate engagement (both which naturally occur as part of the change cycle). This is key to successful business transformation. Are you ready to do this?
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10 Most Damaging Growing Pains in a Small Business; https://www.thebalance.com/growing-pains-in-small-business-1200437
Rod Kurtz, Richard Branson: How to Overcome Growing Pains; American Express.com; https://www.americanexpress.com/us/small-business/openforum/articles/richard-branson-how-to-overcome-growing-pains/
Samuel Edwards, The 9 Growing Pains Entrepreneurs Need to Overcome, Entrepreneur; https://www.entrepreneur.com/article/247173