In Business growth and finance, News

Colin Bell, Business Growth Director, discusses how to lead your business through different phases of growth.

At the North East LEP, our business growth programme exists to make sure that people have access to the support and finance required to start and grow a business. It’s therefore important that support is targeted at the common challenges faced when transitioning from one stage of growth to the next. Each transition tends to change the businesses structure, complexity, and what’s required from leaders as well as throwing up a multitude of challenges that risk destabilising the business and stalling growth.

So what are the main phases of growth and associated challenges?

Phase 1: Birth – the owner does everything!

You are the leader, you are the sales person, the receptionist, the technical specialist, the operations manager…..you are the business, it’s an extension of you! As the business’s major resource, you are working incredibly long hours, and family and hobbies feel like a distant memory. Generating a predictable cash flow to recruit additional resources is the short-term issue.

The major challenges include:

  • Defining your market and ideal customers
  • Generating enough cash to feed and develop the business
  • Coping with operational disorder and chaos
  • Maintaining the required levels of energy and tenacity
  • Attracting talent with limited resources.

Phase 2: Development – making the shift from manager to leader

Your business is in lift off; the orders are rolling in, you markets and customers are more defined, you’re utilising 110% of your resources but cash is beginning to build and a management team has begun to form. The business’s operations have become less reliant on your day to day involvement.
The major challenges include:

  • Maintaining the levels of energy required to grow the business
  • Motivating and aligning people’s efforts on the vital few things that will achieve the business’ goals
  • Developing the systems and processes required to consistently deliver your value proposition and control growth
  • Generating or raising enough cash to invest in the businesses development.
  • Identifying, attracting, recruiting and developing talent
  • Developing the trust, capability and confidence in people to empower them to own and take account for parts of the business
  • Developing the competence in others to sell – vital to breaking through to the growth phase.

Phase 3: Growth – becoming a leader!

The business has begun to get real traction, you’re attracting some great customers and employees and are known within the industry and things are feeling a little more stable. Stability, however, can result in a loss of the restlessness and entrepreneurialism that’s got the business to this point.
The major challenges include:

  • Developing the leadership capability required to take the business to its next level
  • Reigniting your entrepreneurial spark and reconnecting with your vision and purpose
  • Packing your business full of the talented people needed to deliver growth
  • Providing the opportunities for talented people to grow their career within the business
  • Making sure that the business’ systems and operations continue to deliver the value proposition
  • Having visibility of and understanding what causes either good or bad performance
  • Nurturing, enhancing and maintaining the businesses culture, value and purpose.

Phase 4: Expansion – Mastering Leadership

Your business has been successful, you’ve expanded geographically, perhaps made a few acquisitions, but it’s likely that your market is becoming more crowded and competitors are approaching your customers and your staff. Growth requires something new to differentiate from the competition and to retain profitability. It’s time to break the mould and rewrite the rules of competition creating a culture capable of developing and executing the ideas that will disrupt the market.

  • Developing a culture capable of generating and moving forward the new ideas that will fuel your next growth curve
  • Breaking down the silo mentality and sub cultures that has formed over time
  • Communicating and having presence across a larger business
  • Keeping people aligned to the businesses vision and goals and living the businesses values and purpose
  • Developing effective governance and keeping an increasingly complex group of stakeholders happy.

To find out what support and finance is available to support your growth then please visit www.northeastgrowthhub.co.uk

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