Opinions

For A Business To Grow, First It Needs To Shrink

Access to business markets is easier than ever, so you don't need to be a big organisation in order to win big.

Share this article

Share this article

Access to business markets is easier than ever, so you don't need to be a big organisation in order to win big.

Opinions

For A Business To Grow, First It Needs To Shrink

Access to business markets is easier than ever, so you don't need to be a big organisation in order to win big.

Share this article

The secret to growing a small business is that you need to be lean. Continually hiring more people and expanding the scope of what the business offers will not necessarily lead to success if you don’t have the right focus.

Running a lean business is the key, because being lean fundamentally means that you are getting maximum value from every part of the company. You should be thinking about how to optimise your business as a whole, not just focusing on individual parts.

If you do this well, your lean startup could well be more successful than much bigger companies.

Have a reason for everything!

If you’re running a lean business, then you should have a good reason for everything that goes on. If you want to get the maximum value from the resources that are available, you need to be serious about cutting down waste. If you can’t give a good reason why something is happening, it’s probably waste, and it should get the chop.

You need to guard against complacency - don’t do something one way just because that’s how it’s always been done. If the chance arises to improve something, do it.

Justifying your decisions starts with having a clear knowledge of the objectives of your company. This is not the same as having an entrepreneurial vision.

Visions are meant to be something to aspire to, perhaps even something unattainable, and while they may inform your goals, your goals themselves should be tangible metrics that you can use to measure your success. Everything that you and your team do should serve to push the business closer to your goals.

cutting tailoring

It's a good idea to cut out what you don't need

Understand your customers

It is essential that your goals, and therefore your reasons for doing what you do, are motivated by your customers. These are the people that are paying you, and if they stop paying, you stop earning. It is not enough for you to think that something is worthwhile if your customer isn’t willing to pay for it.

Sometimes, this leads to tough decisions. You may have to axe a great new product idea because it isn’t clear that the market exists for it at the moment. Sure, a big corporation might be able to take a chance on it, but you have limited resources and you have to get as much value from them as possible.

Focus on making the products and services that you know customers will pay for as good as possible, and keep the money coming in.

Get everyone on board

Your current employees, and everyone that you hire in the future, should be on board with your lean methodology. As you grow, it will not be enough for the entrepreneur to be the only one thinking about these things that I’ve already mentioned.

Train your employees to ask themselves if what they’re doing is adding value to the company. If someone isn’t able to do this, maybe your startup environment isn’t right for them.

If you encourage a lean culture as you grow, you won’t have to work hard to implement it further down the line (which would be a big burden on your time). Hire people who can take responsibility for their own time and work, and make sure that people understand what the customer wants and what the goals of the company are.

structure of a business

Structures hold growing businesses together

Don’t be afraid of structure

As soon as your team grows too big for you to manage individually, you should start to think about your company’s structure. Such a thing might seem at odds with a free-thinking entrepreneurial mindset, but it’s crucial for a lean, value-orientated business.

At its most fundamental level, implementing a structure simply means making sure that everybody knows what (and who) they’re responsible for, and everyone knows who they report to.

You need a structure like this to make everyone in your business accountable, which in turn allows you to solve problems far quicker than you could in an unstructured environment. This isn’t about pinning blame on people, but about arriving at the root cause of the problem as quickly as possible to allow it to be fixed, freeing up your time and resources to continue improving the business.

The bottom line

If you only remember one thing from this article, remember this: a successful startup will always get the highest possible value from its resources.

Cut away the baggage that isn’t doing anything for your company, and work on improving the things that add value. If you do, your customers will stay happy, and your business will be in a great position to grow.

Related Articles
Get news to your inbox
Trending articles on Opinions

For A Business To Grow, First It Needs To Shrink

Share this article