Most people think the hardest part of running a company is getting it off the ground. Once they gain momentum, it’s smooth sailing from there on out.
Every company experiencing success must decide whether they want to continue to grow and increase profitability or remain stagnant. And because growing isn’t as easy as leasing more office space and hiring more employees, this means running the business doesn’t get any easier.
Here are 5 tips for businesses experiencing fast-paced growth and what you can do to prevent growth based problems from hindering your company’s success.
Unless it’s Crystal Pepsi, people like transparency in their lives. It’s why we don’t like drivers with tinted front windshields, jack-in-the-boxes, or Spirit Airlines, and why more companies are using anti-marketing strategies to show customers how transparent they are.
Transparency within in a company isn’t just about open doors. Every employee should know and understand the vision, objectives, and strategies of the company and work together to achieve these goals. This makes it especially important for fast-growing companies to embrace and practice transparency and not let it become another buzzword to get tossed around by the executive team.
Managers and company leaders alike can maintain a transparent environment by having open communication channels and proactively share company updates, news, and information with their team.
Hire the Right People
What is the financial impact of a bad hire?
Fast-growing companies may be tempted to speed up their hiring process to accommodate growth, but it’s worth investing the time and money to recruit top talent. Since a bad hire costs a company 30 percent of the employee’s first-year salary (not including other expenses like relocation fees or lost customers), it’s best to hire right the first time.
When holding interviews with potential employees, find out what matters to them. Are they looking for a career or a job? Do they want more out of their career than a paycheck? Do they align with the company’s core values? Since one bad apple can spoil the barrel, fast-growing companies need employees who can mesh with their culture; people who are flexible, can adapt to ever-changing environments, and are capable of tackling challenges outside of their skill set.
Fast-growing companies should have processes that help them find the right employees for the job and not just fill openings with those who look good on paper.
Don’t Neglect Company Culture
Culture is created and defined early on by the company’s founders. When a company is first starting out, the team is smaller and relationships are more personal, making it much easier to establish a culture with a clear vision. Once the company starts to experience growth, it’s harder to define core values, so it’s important that the founders maintain and practice the culture from the very beginning.
Many things can hurt a company and cause its culture to disintegrate: hiring people who don’t support the company’s shared ideals and vision, lacking authentic communication, failing to incentivize employees, etc.
What you don’t know can hurt you. Since company culture is about people, it’s important for a fast-growing company to continue to listen and understand what their employees want. Continue to ask for honest feedback from employees and have processes in place to ensure anonymity.
Keeps Employees Motivated
Not long ago, the most a company had to do to keep employees was offer job stability, a paycheck, and some benefits. And if a company was really generous, they may have even offered a 401k plan.
But those days are gone.
While keeping Lucky Charms stocked in the kitchen, having a ‘no dress code’ dress code policy, and furnishing the office with foosball tables are all nice perks, they’re not what keeps your best employees sticking around.
What factors encourage motivation?
Herzberg’s motivation-hygiene theory focuses on the importance of internal job factors as motivating forces for employees: motivators and hygiene factors. Motivators are the things like being recognized for achievements, having meaningful work, or feeling a sense of importance within a company. Hygiene factors, which are extrinsic to the work itself, are things like having a good salary, paid vacations, or one’s status within the company.
Employee motivation correlates with company culture. Since employees contribute to the success of a business, it’s critical that a company experiencing a surge in growth prioritizes and listens to employee feedback.
Watch Your Cash Flow
From financing to finding new customers and expanding infrastructure, fast-growing companies have a lot on their plate. Amidst the disorder that comes with growth, running out of money should never become a part of the problem.
With so much cash changing hands, it’s easy for a scaling company to lack cash flow forecasting.
This makes it especially important for fast-growing companies to have proactive cash flow management. Taking a proactive approach to cash flow ensures that a company forecasts the timing of when cash is to be paid and received, and will give insight into whether the company is at risk of running out of cash.
If your business is preparing for or in the midst of growing or looking to scale but in need of expert advice to making smarter decisions and setting better goals, contact us today.