The priority for businesses whose growth trajectory has remained intact or even accelerated over the past few months will be scaling up to the next level. One of the challenges they will face is identifying and overcoming the barriers to delivering sustainable growth in a ‘new normal’ – or potentially ‘never normal again’ – commercial environment.
Some obstacles to growth stem from a lack of process and prioritisation, leading to a lack of focus. James Howard, director of business consultancy Red Orchid, says: “Sustainable growth is more likely to be achieved when growth, profit, commercial, operational and cultural excellence align within a balanced strategic framework. Exclusively targeting growth often results in people defining how it will be achieved, before fully understanding why they want to grow and the indicators underpinning opportunity, desired outcomes, and potential risks.”
According to Paul Holmes, managing director of PCH Business Support, cash flow and capital investment are typically the biggest barriers to growth, and understanding and managing these against the business plan is vital if the team is to be expanded, and new services, equipment and systems implemented to support next-stage growth.
“Can the company’s systems and processes cope with the increased demand, increased data management and processing orders, without error?” he says. “Customer experience, stock management, logistics, training, development of the team must all be carefully managed as they can bring growth to a halt.”
Know your strengths and weaknesses
Simple tools like a business model canvas can help a company understand its value proposition, its relationship with customers and suppliers, and staff requirements, allowing the team to identify gaps, weaknesses, or opportunities.
A straightforward SWOT analysis will help the team start to look at where pain points might be or what threats need to be countered. By identifying points in each area, it’s possible to see where you can adapt, improve and build to support growth. But as business expert Erica Wolfe-Murray explains, before business owners make a start with a SWOT analysis they should spend some time digging into their past trading.
Customer experience, stock management, logistics, training, development of the team must all be carefully managed as they can bring growth to a halt
Managing director, PCH Business Support
“It’s important to start with a thorough review of past experience, working life, clients and sectors, and trading history, etc,” she says. “This information feeds into the business’s ‘strengths’ and ‘weaknesses’, and everything contributing to these should be internal to the business to date. Then you look at the external factors that impact the business: the different marketplaces you operate in, your different audiences, emerging trends, and what your competitors are doing. All of this external information feeds into the ‘opportunities’ and ‘threats’. These lists should be dynamic and constantly updated.”
Another obstacle to business growth is imposter syndrome: that secret fear of being ‘found out’ as ‘not good enough’, in spite of success to date. The 2019 Imposter Syndrome Research Study revealed that as many as 82% of entrepreneurs struggled with this daily or regularly in the past year.
Clare Josa, author of Ditching Imposter Syndrome, says: “To grow a business to the next level, you need to have scalable systems and support in place, but it is equally important to take action to get out of our own way, clearing out any hidden fears and excuses that cause us to ‘play small’, so that business decisions can be based on what’s right for our customers, rather than triggering our inner critic’s emotional roller coaster.”
Be right for now
Growth businesses can avoid some of the obstacles by focusing on a single question: ‘Does the current scenario present my business with a unique opportunity?’, as Ant Cauchi, co-founder of live video coaching platform PepTalk, explains.
“In 2008, we were a small agency, Outside Line, producing high-quality work,” he explains. “In a market that was under financial pressure, clients were prepared to look beyond the usual big names. We were agile and cost-effective enough to pitch against the ‘established’ agencies and win, and our business flourished.
“Now, as a result of Covid-19, remote working is dominating business. With The PepTalk Co, which was launched in 2019, we have a digital product that’s right for now. We have shifted up our timelines, hired ahead of the curve, and are pushing to provide as much value as we can in this moment. In both these cases we saw the market present opportunities for our business and went with them.”
Stay in control
Barriers to growth can also arise from failures within the organisation. These could include failure to communicate an inspiring vision that resonates with the target market and staff who will lead or implement growth; failure to involve employees in determining and overcoming pain points that are barriers to efficiency; and failure to automate and digitise simple, repetitive processes to improve the consistency of outcomes, maximise economies of scale and improve access to goods and services that can enhance the customer experience.
“Most things are in your control, especially the pace of growth,” says Howard. “Successful outcomes can be achieved through robust financial modelling and realistic targets, assessing risk and opportunities equally, and being prepared to pause or pivot as either emerge.”
As the business starts to grow rapidly, key indicators must be monitored to ensure that the growth can be sustained. This includes communicating with customers to ensure customer satisfaction isn’t changing, monitoring cash flow against the plan, and monitoring the quality of product or delivery of service for consistency.
“Feedback from the team, morale, pressure, stress levels, absenteeism, retention rates are also indicators for the sustainability of growth,” says Holmes. “Any changes to the measured data should be brought to the weekly or monthly management and growth-planning meetings, and considered and addressed, with new actions and plans added to the overall plan and managed in the same way.”