Growing a scalable small company or startup is hard work. Entrepreneurs are the only people I know that work 80-hours per week to avoid working 40-hours. I have been at the helm of many startups over the past 20-years and I’ve experienced successes and struggles. In fact I am starting another company, Vocaly, and I will be documenting my journey in order to help other entrepreneurs with their journey’s.
After living the first few years of my entrepreneurial career with struggles, I found a better way. This is when I began attending a conference called The Gazelles International Growth and Leadership Summit. These conferences exposed me to a whole new world of entrepreneurship that I never knew existed.
After attending a few of these semi-annual conferences, it was simple to figure out where I was going wrong, but figuring out what to change in order to do things “right” wasn’t as easy. When I heard Verne Harnish, the creator of The Gazelles International speak, I decided to read his book, Mastering the Rockefeller Habits. I knew that I had found the answer. Since then, Verne has written another book called Scaling Up, which I recommend to all small business owners and anyone trying their hand at a startup. Verne’s books introduced me to the importance of focusing on three key phases of operating a business; Growth, Delivery and Support.
These three phases have to work in perfect harmony in order for a company to achieve high growth. At any given time your business is in one of these three phases, which ironically also identifies your business’ choke point. By identifying and removing each choke point, you move your company through each phase. Think of a triangle with each point representing one of the phases. The top point being “Growth”, the bottom right being “Delivery” and the bottom left being “Support”. Each one of these phases spin and the quicker you spin each phase, the quick you will move the choke point ot the next phase. The quicker you make one full revolution from growth, to deliver, to support, the faster your company will grow.
The Growth phase is made up of any department or employee that deals with the growth of your organization. Traditionally, these would be your strategies, marketing and sales departments or staff. Having a solid and well defined strategy is the keystone in any business. Without a solid strategy, you will NEVER have sustainable growth. It would be like going on vacation but not choosing where, how you will get their and when you are leaving.
Delivery, on the other hand, is any department or employee that deals with the delivery of your product or service. This could be engineering, developers, or vendor-relations. Delivery ties into the growth strategy. In my analogy of going on vacation, delivery would be the act of picking a date to leave, a method of transportation and deciding what you are packing. These are all key ingredients to a successful trip.
The Support phase, or as I like to call it, Operations are the departments or employees that support the product delivery like your; call/support center, billing, HR and legal functions. In the trip analogy, it would be deciding who’s going to go, who is driving, who is buying the gas and when to stop and eat. All the behind the scene activities to get to your destination.
So, how do you move your company from one phase to the next phase? The answer is: By spinning each phase, faster. Someone MUST be accountable for each phase. If you are in the Growth phase, you may want to start by looking at your overall marketing strategy and identifying if it is driving enough qualified leads to your sales department. In the sales department you may want to find ways to drive out waste and shorten your sales cycle. Doing this will move the choke point to the delivery team.
As your business takes on new customers, your physical and human resources get consumed. Your delivery team will need to augment your systems and human capital in order to handle the additional sales. Once the delivery team delivers what was promised by sales, the pressure moves to the support teams. This pressure will come in the form of billing your customers, additional billing questions, more call volume and more bookkeeping duties.
When the support department scales up and solve each road block, the impediment moves back to the growth team, completing one full cycle. The faster you spin each phase, determines the number of full cycles, providing your company with growth and scalability. In future post I will discuss each phase in greater detail, so keep checking back to the Vocaly blog
Co-Founder and Managing Director