Get Yoda's Wisdom

Ask any small business owner and they will almost always tell you the same thing. If they could just grow their business bigger and faster, everything would be terrific. Not so fast, there my young business warriors! Growth and success are not the same. And further, all success comes at a price.

First, let's address the growth issue.

You always want to grow the business. But, growth for growth's sake is sometimes detrimental to the business. I would guess 75% of all of the inquiries I get from prospective clients come from companies whose "growth is stalled." Yet when I ask them where they think they should be and why, and further, why they're not there, they simply have no answers.

You should rationalize why and how you want to grow. Playing the game just to achieve "the scoreboard" (kind of like professional athletes' salaries) can create all sorts of problems for you. First, you want to grow in a measured way so you can effectively manage the growth (and have the capital to support that growth). And, second, you want to do it, profitably. Two fairly, self-evident points. Yet, many entrepreneurs find themselves either growing too fast and not having the infrastructure or the cash flow to support that growth, or they are growing with reduced profitability or both.

Growth requires a plan. I spent a previous blog post (December 15, 2009) talking about the importance of a plan, throughout the life of a business. The plan helps you rationalize growth. New products, new customers, new markets, etc. It forces you to determine the strategies and tactics you will use to achieve that growth, including what infrastructure changes you will need to achieve and support that growth and how you will fund it (remember my rule of thumb from previous blog posts - about 35% - 40% annual growth is about all you can expect out of cash flow, unless you have a very unique business model - they're out there, but few and far between). And, of course, it should be flexible enough for you to modify it along the way.

And now comes the even harder part. Let's say your growth plan works and you achieve the success you were after. It will come at a price!

The business will no longer be so easy to manage. You might have doubled staff, expanded your facility requirements and your payroll may have doubled or even tripled. The challenges of the early stage will seem like "child's play" compared to the growth stage. You will lament about how easy it used to be when it was only you and your three earliest employees. And this is another crossroads for small business owners. Success means that some professional management needs to be added to their organization - folks who have "been there," to assist you with further managing and growing the business. And your biggest test - to maintain and expand the culture that you have built so that the new employees embrace and thrive within it and this continues to translate to existing and new customers.

For the small business owner, growth and success are always challenges to reach. And, they come at price. But the price is, most often, well worth it. The price encompasses growth of a different nature - personal and professional, stretching and challenging the entrepreneur to new heights, bringing satisfaction and value way beyond just the balance sheet! It is the building and growing of a team to drive the business. You are no longer alone!

Master Yoda knows these things. His job it is. May success be with you!