Growth is always a part of a company’s strategic plan. From its earliest stages, companies are working to win new business, create innovative products and services, and establish a presence in new markets. However, growth tends to stall once companies reach the maturity stage.
“Growth plateaus in mature companies typically because they’re not as focused on innovating their products or services as they had been at the start,” says Patrice Blakemore, interim executive director of the Goldman Sachs 10,000 Small Businesses program. “Instead, their attention is more on the delivery of existing products and services — both of which are already proven and established in the markets they serve.”
Smart Business spoke with Blakemore about growth in later-stage companies — why it can stagnate and how businesses can jumpstart it again.
What are some of the more common reasons that growth in mature businesses stalls?
Companies at the maturation stage stall when the focus shifts from strategic initiatives, such as expansion and innovation, to technical initiatives, such as day-to-day operations. That happens a lot when business owners fail to delegate to employees aspects of the operation, e.g. order fulfillment and customer service. Business owners become tangled in the weeds, which prevents them from establishing a long-term strategy and vision, and setting organizational milestones.
In business, what gets measured gets done. Goal setting and accountability are equally important to daily tasks. Business owners should ask themselves, ‘What are we measuring? Why? Who is responsible for hitting those goals?’ Incorporating an accountability process can help business owners measure where they are relative to their strategic direction and identify benchmarks for growth initiatives.
How can small businesses create successful growth opportunities?
Most often, when small business owners think about growth, they think about what they need — increased revenue, additional staff, better equipment — rather than their clients’ needs or pain-points. For growth to continue, business owners must focus on their customers.
Focus groups are a good way to get in touch with client needs. Current and past customers can offer insight into what products and services work well, their current pain points and what the company could deliver that would address any gaps or unmet needs.
When business owners feel stuck, who can they work with to generate ideas that will move their businesses forward?
Cleveland has many resources for businesses in need of advice. There are business coaches, outsource CFOs and consultants with experience in myriad industries who are available to help companies align their metrics with their goals. Advisers can analyze a business from a numbers standpoint to determine what is working strategically and what is not.
In addition, there are other programs that focus exclusively on growth and offer tools to vet ideas, identify opportunities and create a plan for growth.
As they mature, the challenges faced by small businesses are common — hiring, retention, finances. Companies that feel they’ve stagnated can find support from community resources and people who are invested in their success.
Community colleges are wonderful resources for small businesses. They offer noncredit courses — in-person and online — designed to support small business owners. Courses include QuickBooks, leadership and organizational development, and information technology that will benefit their management team.
Companies should always have an eye toward innovation and growth opportunities and a plan to stay relevant to existing customers. It’s not uncommon for progress to slow down. But recognizing it and taking steps to address it are critical to a company’s continued success.
Insights Education is brought to you by Cuyahoga Community College.