Starting a new business is a crash course in everything from getting a loan and setting up shop to managing employees and attracting customers. But your education doesn’t end there. You’ll also learn important lessons when it comes time to scale the business, including how to navigate your way through the next stage of growth.
5 Things You’ll Learn From Growing Your Business
Learning never stops, especially for entrepreneurs. While you may have to learn things the hard way for them to stick, it helps to know what might be coming.
Here are five lessons you’ll learn when scaling your business and why they’re important:
1. How to Communicate Effectively as Workload Increases
Most startups begin small, with skeleton staffs and tight budgets. As the business starts to scale, each team member will be required to handle a bigger workload to keep pace with new orders, clients and infrastructure. This is a critical stage in the development of any business — and one where clear communication can make the difference between success and failure. Successful business owners learn how to articulate the company’s mission, goals, processes and major changes in a way that ensures everyone is on the same page as their workloads increase.
As the business scales, you’ll learn how to provide clear guidelines on the goals and expectations of each team member. You’ll also learn how to foster two-way communication to ensure team members get all the tools and materials needed to do their jobs and how to streamline and centralize modes of communication — such as email, text, phone calls, video conferencing, in-person meetings and instant messaging — to make them more efficient.
2. When and How to Delegate
It’s natural for entrepreneurs to want as much control as possible in the early stages of a business, but at some point, you’ll have to loosen the reins. That point usually comes as the business begins to scale and more of your time needs to be spent on big-picture items rather than day-to-day operations.
The learning process for successful entrepreneurs not only includes recognizing when to let go of certain responsibilities but also how to delegate those responsibilities to others. Delegating more operational duties to staff — or outsourcing certain tasks to third parties — ensures that you can devote more time to strategies that help your business grow even bigger.
In order to delegate effectively, it’s critical you hire smart people you trust; that way, when you delegate, you know the work is in good hands. Doing this makes delegating less about relinquishing control and more about setting your team up for success.
3. How to Put Effective Processes in Place
One of the most important lessons you’ll learn while scaling your business is how to implement the right processes to ensure a successful transition from one growth stage to the next. It might be fun (and even effective) to improvise and veer off course during the startup phase, but that’s no longer feasible when your business gets bigger.
As the business scales, you’ll learn to clearly identify plans and systems required to scale successfully, as well as how to document the steps, procedures and guidelines needed to keep everything moving in the right direction. You’ll also learn about different accounting systems needed to handle the extra business, new HR processes to deal with a growing staff, and new sales/marketing strategies geared toward a wider customer base.
4. The Difference Between Leading and Managing
Getting a business up and running requires management skills — the ability to plan, direct and supervise. But scaling a business and taking it to the next level requires leadership skills that go well beyond simply overseeing things. As a leader, you’ll be more concerned with the “why” of the business rather than the “how.” For example, you might focus on why your sales model needs revising rather than how to revise it. One way to look at it is that a leader creates value whereas a manager protects value.
To lead effectively, you must avoid silos. Leaders can’t do it all themselves — they need to inspire their teams to reach mutual goals. As your business scales, you’ll learn how to motivate your team to think proactively and creatively so you trust them in a way so you don’t have to put a lot of time and effort into micromanaging their jobs. You’ll also learn how to develop a vision for the company’s future — and how to influence team members to fulfill the vision.
5. When and How to Seek Funding
Scaling a business means not only putting more time and energy into it but more money as well. It takes capital to grow and expand. One thing you’ll learn is how to create a financial model that accounts for your growth and ensures you spend money wisely to get the best return on investment (ROI). You’ll also learn when to seek outside funding to take the business to the next level, whether it’s for acquisition, new equipment, a larger space, more staff or something else.
At this point you’ll need to educate yourself on the best financing options — a process that will require you to learn what banks, private investors and other funding sources have to offer businesses that have grown beyond the startup phase and now need money to finance growth.
Take the Quiz: How to Decide Which Funding Option Is Right for You
The Bottom Line
Watching your business grow and expand is one of the most rewarding parts of being an entrepreneur — and one of the most challenging. If you find yourself unsure of how to proceed, or you just want to be better prepared, don’t be afraid to seek the counsel of trusted mentors and colleagues. Learning how to navigate through every aspect of scaling your business can help ensure success through all subsequent stages of growth.
More From Seek
- How to Write a Business Proposal
- 13 Lessons Entrepreneurs Wish They’d Learned Sooner
- 5 Creative Ways to Fund Your Business Without Investors
Business Loan Resources
Photo credit: Monster Ztudio/Shutterstock.com