How to Develop Growth Strategies for a Business

In running a small enterprise, time is the ever-present enemy. The owner-manager is the firm’s major asset – using that asset to maximum advantage involves a planned and fully thought through use of time. It means, in other words, the same careful planning as applied to finance and marketing.

Periodically, keeping a diary of daily activities for a week or so is more than helpful. Often this is a source of surprises – it not only tells you where your time goes but throws up suggestions about how it might be used more profitably. Priorities have to be selected, especially when the work load becomes over­whelming, as it does from time to time in any busy enterprise. Should you be doing this or that task yourself at all? Costing out your time may show that employing somebody else produces more profit than doing it yourself because you could use your time to earn more than they cost. Remember, employees do not have to be bought whole – part-time workers may be more effective.

Business Growth Strategies

Owner-managers are often tempted to hire mirror images of themselves. But that may simply duplicate present personal strengths and weaknesses. It might be smarter to find some­body who is good at the tasks which the owner-manager finds most frustrating or boring. An employee may not only be better at the job than the owner-manager – he may also be cheaper. The object is to free the owner to do things which he or she does best, including planning.

Activities such as dealing with routine telephone inquiries, bookkeeping and other paper work are important but the owner-manager can use time more effectively doing other things. What is important is to ensure that any new job is clearly defined and a good working relationship is built up with the occupant. Informal relations are attractive – ‘we are all friends here’ – and an easy atmosphere is an asset, but a lack of clarity about what people are responsible for is a recipe for trouble.

All the above is doubly important when the time for hiring specialist skills arises, usually as an enterprise grows. This in­variably means the delegation of duties which the owner-manager did previously and a more consultative approach which some owner-managers find difficult to come to terms with. The idea of a management team, which means that others will have a share in decisions, sometimes seems threatening to the owner-manager’s highly valued independence.

This is compounded by the typical specialist’s personal com­mitment pattern. For him, the firm is often just one more step on his career ladder: he has not got his life savings bound up in the enterprise and other jobs in other firms may emerge as more attractive. Equally, the loyal jack of all trades who has frequently been with the firm from its early days and who did part of the job previously, sometimes feels cheated when a new­comer takes over. All these problems can be minimised by care­ful planning. If not, they can be an organisational time bomb blowing up just when the firm is vulnerable because it is going through fundamental change.

As firms grow, relationships with the outside world become more complicated. Banks, local authorities, government depart­ments and perhaps trade unions all begin to take more of an interest. Owner-managers often resent this ‘interference’ but the outside world will not go away. The mark of a successful small enterprise is that its owner-manager recognises that posi­tive strategies are needed to adapt to the outside world rather than simply ignoring it or indulging in an energy-wasting attempt to take all comers on.

One strategy is to invest in deltek outsourced bookkeeping and accounting – using the resources of the outside world to cope with that same outside world. For instance, if you have a roofing business, you may want to invest in Bookkeeping for Roofing Contractors. Good accountants need seeking out. Too many account­ants simply do the books every year regarding their main job as minimising the tax bill. They do not offer any useful and needed additional advice for a growing business. ‘Management accounting’, providing skilled advice and help to augment the firm’s in-house planning and controls, is increasingly being recognised as what accountants should be doing. Younger members of the profession are now being trained and are keen to do just this. They become part of the business – albeit part-time – consultants rather than fillers of tax forms.

There are now many advisory schemes aimed at the small business which provide cheap but valuable advice and other resources for the small firm. In fact, it has been said that there are now so many sources that the average small business owner is entitled to be bewildered. Some are government initiatives, such as the Small Firms Service run by the Department of Employment. Others are a mix of public and private enterprise, such as many of the 300 plus local enterprise agencies now up and running in Britain.

Growth Strategies

College courses abound, often run on a subsidised basis and at times convenient to the busy owner-manager. Small business clubs are also mushrooming, helping to counter the isolation of so many of those who have set up for themselves. The chance to meet others, to talk, learn and exchange ideas, is far from a waste of time. It can prevent the loss of perspective which arises from over-involvement in a single activity like running a busi­ness and a break from over-preoccupation with your own prob­lems.

In a small business, more so than in any other, ‘management intensity’ and overload are likely. Functions merge into one another, tasks are left uncompleted and short time perspectives dominate. Making room for planning is not a luxury but an essential, if sanity and business are to be preserved. Planning uses time to make more effective use of time and enables the owner-manager to discover how to get more out of life. Run­ning a business should be creative, rewarding and even fun, not a treadmill which deadens the soul and shortens your life.

Filed Under: General How To's


About the Author: Marie Mayle is a contributor to the MegaHowTo team, writer, and entrepreneur based in California USA. She holds a degree in Business Administration. She loves to write about business and finance issues and how to tackle them.

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