- Growing your way into bankruptcy In standard
“PAUSE, PAUSE, PAUSE!!!”
I was yelling at the remote and pushing every button. I had somehow put the TV show my husband and I were watching in fast-forward mode. Exasperated, I tossed the remote to my husband who deftly found the pause button and stopped the madness. After he stopped laughing, he revoked my remote control privileges for the rest of the show. Ahhh… true love.
I consider myself pretty tech savvy but the remote is my arch nemesis– probably because I don’t watch much TV.
As I think about that episode, the analogy just hit me. How often do we wish we have a PAUSE button for our businesses? Unfortunately, like my inability to make the program stop, we don’t have the luxury of a pause button to stop the constant craziness of everyday business life.
A lot of companies are on a hyper-speed track that comes with rapid growth. And similarly to my remote-control situation, there’s no way they can stop it without intervention.
Here’s the thing. You can grow your way into bankruptcy if you don’t stop and make some changes. While many entrepreneurs aspire to rapid growth, behind the scenes might be a company that is posting great top-line numbers but may be crumbling on the inside. While everyone aspires to rapid growth, those who are in it can feel out of control. And, in many cases, they are.
Here are some common growth issues and the PAUSE you need to take to assess how you will address (or prevent) them:
- Infrastructure suffers. When you grow fast you are often “too busy” to find time to make sure your underlying processes are sustainable and scalable. Many times band-aids are put on problems to patch them until the “day when we can find a permanent solution.” Wrong.
- PAUSE: Spend some time and invest in developing your infrastructure. Make sure you document your procedures. Find time to identify if the way you are doing things is the best way. Your ultimate question is: Is it scalable?
- Cash is sucked out of the business faster than it is replaced. Growth devours cash like a hungry dog scoffs its food. If you don’t have a plan on how you will sustain your business in the short or long term you can literally grow yourself into bankruptcy. Seriously.
- PAUSE: If you are saying “my business changes too fast to forecast it” you have the wrong forecasting tool– (if you even have one at all.) There is no better way to be able to sleep at night than to have a forecast in place to make sure you are able to make payroll.
- Growth requires new people, and fast. Sometimes growth means that you need more people, and relatively quickly. However, unless you train those folks, you can find yourself with a team who is “winging it.” That’s the last thing you need.
- PAUSE: Hiring people can be as expensive as buying a new house, yet fast-growing companies don’t give it the necessary time and dedication they need to vet them properly. Be sure you create a formal onboarding process and the work that your current staff is doing works.
Growth is great on the surface, but smart growth is even better. So take a moment, and pause. Look beyond your growing revenue number, and make sure that growth isn’t damaging the long-term viability of your business.
What ways have you found to manage growth in your company?