One of the things many new businesses aim to achieve is scale. Scaling your business means you can grow without being inhibited by staff, funding or technology issues. Your business is lean, your processes are water tight and you can achieve what you want to achieve.
But what does that actually look like? And how do you actually scale a business anyway?
In this article: 5 essential tips on how to scale your business in 2024
- Growing the Business vs. Scaling the Business
- How to Scale
- 1. Follow a process to scale
- 2. Scale according to customer’s needs
- 3. Never leave out employees when scaling your business
- 4. Maximize local resources
- 5. Consider working ON the business vs. working IN the business
Growing the Business vs. Scaling the Business
Growth is different from scaling, even if both concepts point you in a similar direction.
Growth is an increase in capacity and operations along with an increase in revenue. However, this increase may be coupled with a concurrent rise in costs, so there’s no guarantee the business is earning any more in profit. The business can end up being more complex and harder to manage, while the profit margin remains the same.
On the other hand, scaling means increasing revenue while keeping costs down, and it all boils down to how the business can prioritize efficiency.
For example, online fashion store Shein has not only seen skyrocketing revenue in the last few years, but it’s also used technology to improve and speed up production systems in an incredibly smart way.
It uses sales data to inform manufacturing facilities which products are popular, so it can produce more of these items, meeting customer needs and reducing wastage.
This is all automated, and it’s a good example of how a business becomes more efficient (and more profitable) as it scales, rather than simply growing by selling more.
How to Scale
While the method for scaling a business depends on its unique characteristics and circumstances, there are some common factors that tend to be used to achieve it.
- Automation. Automation technology allows businesses to replicate tasks for no extra cost. It can also give you unlimited production capacity.
- Technology. In today’s world, there are an infinite number of ways technology can make businesses more efficient, reducing overheads in almost every business area - if not all.
- Innovation. Achieving scale requires constant improvement in how you do things. This starts with being aware of your bottle-necks, hurdles and barriers, and overcoming these challenges with creative problem solving.
There can be many other aspects you can use to scale, but these three factors are almost always utilized in order to achieve it.
Not all businesses can scale. A self employed plumber can’t scale, as they have to perform just about every task themselves. However, an e-commerce platform can scale easily, because it doesn’t need a premises, can list endless items for sale online and utilize automation and technology to make sales processes efficient and cost effective.
Sometimes, achieving scale means focusing on how you perform your services in order to make them easier and cheaper to replicate, without taking up more and more of your time.
5 Essential Tips on How to Scale Your Business
Here are the 5 essential tips on how to scale your business this year:
1. Follow a process to scale
Determine what steps and strategies the company should follow. By having set processes, you standardize your operation and can ensure you’re working to best practice. It also means you can improve processes easier, because those processes are set in stone.
A good example of a business investing in its processes is Tesla. Tesla is expanding its production capabilities as it grows, including improving battery efficiency and automating assembly lines to keep up with global demand.
Creating a process map can help business owners and employees visualize and understand the necessary steps to ensure continuous improvement. This can take time, so allow at least six months.
Simplicity is an important feature of the process. Astute business owners understand the importance of simplifying things to make them more digestible for all stakeholders. Complex processes can siphon resources because they require more alignment meetings and communication, and this can ultimately slow down the scaling process.
Tools such as Lucidchart, Tallyfy and Gliffy are all tech-enabled tools that can make it faster and easier to design and track processes.
Where possible, try to create standard operating procedures (SOPs) that contain detailed instructions of the processes within the company. Having a unified approach to operations can help increase process efficiency, mitigate errors, and reduce potential miscommunications. Technology is a fantastic tool in this regard, as it performs the same task in the same way, every time.
2. Scale according to customer’s needs
As company operations expand, business owners should never lose sight of why they are successful—their customers. Improvements must be made to address customers’ needs. For businesses that rely heavily on visitors, key improvements in visitor registration can be critical in improving customer relations. Along with advances in customer acquisition, owners must continue delighting loyal customers.
Customer expectations and behaviors change regularly. People increasingly want things done faster, better or easier. By focusing on how you do that, as well as emerging trends within your industry, you can ensure you’re meeting their needs into the future.
Think about how Apple is constantly innovating to meet iPhone users’ needs. New models and updates regularly include things like new apps, better quality cameras, longer battery life etc.
A good way to stay on top of customer expectations is to seek and monitor feedback. The best way to understand what customers want is to ask them, and to reflect on how you’re performing against their needs.
Businesses that provide only the best products and services can reap significant benefits, including word-of-mouth marketing. However, it is also critical to anticipate their needs, or gaps in the market, and how you can take an active role in closing that gap and reaping the benefits. Improving the visitor experience can make customers feel that they are the focus, which increases their engagement and commitment to the company.
3. Never leave out employees when scaling your business
As your company increases its focus on customers, employees should never feel left out. The employees are a business’s first customers. They are your brand ambassadors. Keep them engaged at all times by providing them with the appropriate tools and resources that allow them to become more effective and successful in what they do. For instance, a receptionist app can free front desk employees to work on more important tasks.
Engaged employees are more productive and committed to contributing to the company’s success.However, Gallup research found only 23% of employees worldwide are engaged, costing the global economy $8.9 trillion in lost productivity.
Give employees feedback wherever possible, and provide growth opportunities, both personally and professionally. Investing in your employees brings good results; it helps to attract and retain top talent, and working with individuals who share the same vision can help scale the business.
There are many different ways to promote employee engagement, including:
- Internal messaging tools like Slack or Microsoft Teams, including channels dedicated to less formal, cultural topics that promote collegiality.
- Employee engagement platforms like TINYpulse that are dedicated to gathering feedback and gauging the culture among staff.
- Employee Assistance Programs such as Clearhead that provide mental health support and counseling, including proactive tools to help staff stay on top of their wellbeing and employee engagement insights.
4. Maximize local resources
One key thing that can help a business thrive is to maximize local resources. Consider partnering with small local businesses. Not only will it help the company keep the costs down, but it can also open and maximize potential partnerships and relationships that make scaling more achievable.
By tapping into local partners, suppliers and other resources, you endear your business in your community. This encourages local customers and puts you in good stead to hire high quality local talent.
Similarly, local resources can fuel expansion into other related areas. For example, Walmart partnered with DroneUp in 2022 to enable drone delivery for its customers.
The best way to maximize local resources is to maintain good quality relationships among the community. Think of organizations that support startups, or your sector, and leverage the services they provide.
It’s not always about being well connected yourself, but having good relationships with people whose job it is to be connected. That way, if they succeed, you succeed also.
5. Consider working ON the business vs. working IN the business
Scaling a business means leveraging the right people and technology. It means hiring talented people and delegating important matters to those who are most knowledgeable and best suited to address them.
This frees owners to work ON the business, handling more high-level tasks requiring executive presence, rather than doing low-level admin like paying electricity bills or emptying the rubbish bins.
When business leaders see the business as opposed to merely looking at it, organizations can better anticipate any potential adjustments and changes to help them pivot and adapt. And actually, when owners aren’t actively providing that high level oversight, the business can end up drifting along without any real purpose or direction.
How can businesses make this possible? By reviewing the process maps they created.
The process maps should give organizations a high-level understanding of the workflows and necessary performance management to help keep the operations optimal. Measure success through key performance indicators (KPIs) and scorecards to manage performance from the ground up.
- Review process maps and look for ways to improve them.
- Use project management and capacity planning tools to identify staff best placed to have tasks delegated to them.
- Block out time in your calendar every day or week to focus on big business decision making.
- Make sure you have set goals, and spend time analyzing your progress towards achieving them.
Final thoughts...
Scaling is not always achieved in a linear way, and it doesn’t happen overnight. Keep it steady and strategic. Start with a process, focus on your customers, reward your employees, maximize resources, and progressively work on your business.
Take a look at the status of your business now and visualize how you want to see it in the future. Do you see yourself scaling this year? If yes, you can start with us.
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