Everyone who starts a company wants it to be successful. They want it to grow because this is the sign of success. Right? Wrong, if that is the primary goal.
2/3 of the companies that made Inc. Magazine’s list of the 5,000 fastest-growing companies had shrunk in size, gone out of business, or been disadvantageously sold 5 to 8 years after they had appeared on the list according to The Kauffman Foundation*. (*Derek Lidow; Fortune Magazine; March 7, 2016)
What lesson can we learn from these numbers? Successful, sustainable companies evolve over time. There is a sequence that predicts their success:
- They start off with the entrepreneurial zeal required to get the venture off the ground and find customers for their products/services.
- As the venture progresses they document their basic processes so they can replicate what satisfies their customers.
- The Ansoff’s matrix is employed to help decide in which 1 of 4 directions the firm will chose to grow.
- More sophisticated processes incorporating continuous improvement are developed which has the added benefit of allowing for new product/service development.
- Professional management is brought in to take the organization to the next level.
We recently had a client with a big heart and a willingness to work harder than anyone else in their industry. The problem was his hard work was killing him & getting the way of their success. They had taken the company from a start up to the brink of success but just couldn’t get over the line. They were frustrated and the business was suffering.
We sat them down to strategize how to make the business more successful while working smarter rather than harder. We reviewed the 5 steps above based on our experience with other successful firms & created a plan with them they could implement.
They implemented the simple plan we crafted together, followed the steps, measured the results and adjusted as needed. The result was an amazing turnaround that started to materialize within 90 days.
The takeaway? It is your choice & your actions that will determine whether you are the 1/3 of firms that sustainably succeed or the 2/3 that fall by the wayside.