Is Your Business ‘Fit-for-Purpose’? Close your eyes for a few minutes. Picture your business and how you are currently managing your customer base. Then, imagine your business at some point in the future, it has grown ten-fold. If you serve 20 customers today, you are now serving 200 (perhaps do the math for your business’s customer numbers). Would you be able manage this increase in output given how your business works currently? Which departments in your business would be struggling to keep up?
When it comes to scaling or growing your business, it is critical to quote Discovery’s Adrian Gore, when he says it must be ‘fit-for-purpose’. Getting to this point is an intentional process where you mould your strategy and business functions to match the growth you have planned. It requires honing every function within your business, from sales and marketing to production, to meet the increased demand for your offering as a result of growth.
This is a deliberate and forward-thinking process, not a spur-of-the-moment decision, and it starts with your vision for the future. But what then? How do you ensure your business is fit-for-purpose?
Letting Go
Often the first step is for senior staff, especially the owner or CEO to let go. As you start to scale, it is no longer possible for the top team to manage the day-to-day running of the business. For example, it is not the CEO’s job to run the accounts or the procurement function of the business, something which may have been the norm during those early days.
It now becomes critical for senior leadership to realise and accept that the business is going to grow into something bigger than themselves. This means they need to adopt a mindset of people, systems and delegation.
A Disciplined Management Team
For a business to start scaling up the leadership team must have the necessary disciplines required to manage a growing concern. Leaders also need to ensure they communicate their growth strategy throughout the organisation and across all functional areas.
As Verne Harnish, author of Scaling Up, puts it: “To move faster, pulse faster.” Harnish recommends that employees take part in a daily huddle of 15 minutes. Individual teams should have a weekly meeting. The executive and middle managers should schedule a monthly ‘learning and resolving big issues’ day. While the executive team should hold strategic planning sessions at least once a quarter.
A Well-Understood Business Model
A business that is preparing to scale must be crystal clear about the organisation’s business model and how it works. In most cases, this requires the careful balance between profitability and capacity. As a business grows it will inevitably need to create additional capacity, from hiring more people to increasing infrastructure such as office and warehouse space, buying additional vehicles, upgrading equipment, and so forth.
The leadership team must have the tools in place to provide a clear idea when it is wise and appropriate to increase capacity. After all, there is no point upping the sales staff if the operational elements are not in line to support a surge in demand, or vice versa.
Fit-For-Purpose Business Functions
The fit-for-purpose attitude must pervade the entire business operation. This requires leaders to drill down into the workings of each department and examine how to repurpose each division to better handle the planned uptick in customer demand and the associated rise in work volumes. Some key areas that I often work through with my clients include marketing, sales, operations and finance. Let’s examine these more closely:
Fit-for-purpose marketing function
The scaling cycle starts with the generation of leads. This is the core function of marketing. For your business to scale you must be able to answer the following three questions:
- How many leads is the business generating per month?
- Which marketing tactics and channels are producing the most leads?
- What is the cost per lead on a monthly basis?
Marketing should not be left to chance. To make the marketing function fit-for-purpose, it is critical to have a clearly defined marketing strategy in place. In addition, there must be a system in place with well-defined action steps which, if executed by the marketing team, consistently produce a predictable number of qualified leads.
Fit-for-purpose sales function
The next step is to convert leads into sales. As leads come into your business, it is vital to have sales conversion metrics at your fingertips. Do you know:
- How many qualified leads and what value, you have in each stage of your sales pipeline?
- How many qualified leads your sales team closes?
- What is the average sales cycle? In other words, how many days does it take to close (or lose) a lead?
In order to measure these metrics, every lead should be captured in a sales customer relationship management (CRM) system and consistently tracked through the sales process from initial lead identification, through the sales stages, to being closed.
This requires your sales team to be trained on a CRM system, which should ideally already be in place. The reality is that if your sales process is not documented, or your sales team does not follow the sales process consistently, your business will struggle to scale.
Fit-for-purpose operations function(s)
As a business leader, are you able to confidently assess that every customer will receive the standard of service they expect from your organisation without you personally overseeing that service? Is this level of service consistent and predictable? Scaling up requires business operations to be systematised in such a way that it produces metrics which you can use to determine if the operations team is delivering in line with customer, and your expectations. This means you need to be monitoring and systematically receiving regular feedback from your customers about their level of satisfaction.
If you do not have these structures in place already then you need to spend time on building systems and processes to ensure your operations functions can withstand the higher levels of pressure which will come with growth. You get this right by hiring the best people, putting the rights systems in place, systematically training, and upgrading infrastructure as required.
Fit-for-purpose finance function
The final step in getting your business fit-for-purpose is to ensure your finance team is well-equipped and skilled. This critical team must be able to generate invoices quickly, collect cash effectively, efficiently manage issues around cash flow, credit and capital expenditure, and report regularly on the financial health of your business.
Talent Management
Finally, to make all of this happen, managing talent becomes a critical function. This includes the ability of the business to attract top talent, to avoid mis-hires, retain quality staff and manage performance in such a way that you create an accountable yet harmonious culture. Getting this right starts by ensuring that all managers are adequately trained on your company’s hiring methodology, thus ensuring that they consistently find and recruit good talent. Every company should want to build a team of A-players, and this is even more important when the business in question has growth on its mind. Getting the right people on board is a vital component in your fit-for-purpose journey and one that will help to drive your organisation seamlessly into the future.
