Managing A Business In Growth Phase
What are the phases of a business?
Many describe 4 business phases, but I like to simplify and stick with three. Although I do love even numbers, for a lifecycle 3 makes so much more sense to me. I’ll tell you all 4 and the 3 that I like to stick with.
This seems really obvious, but just in case, I’m going to go through it in short detail.
During the startup phase of a business, you’re coming up with ideas, looking at how to market your service or product, meeting with new people, constantly learning and educating yourself, and creating and tweaking your processes. This is the part where you typically are overworked and underpaid. It sucks. But, it also can be amazing, fulfilling and rewarding to see your idea take shape and come to life. It’s exciting to start something new that you believe in, and honestly, nothing compares to that fresh, I’m going to succeed feeling you have here. Yea, of course, you also have a ton of insecurities, but the excitement can help put some of those to rest, and you will need that fresh excitement to keep you going. So try your best to hold on to it and reserve some for the future!
This is the phase we are going to talk about, so I’m not going to give anything away…
I like to call this phase Scaling. At maturity level you should feel secure and comfortable in your business. Your first employees may be reaching the 8-10 year mark. There may be some emergencies that demand your attention, but overall, things are running smoothly and for the most part, in an automated mode, whether that be through actual automation or employee’s and staff. At this point in your business, it is predictable and dependable. You and your employees shouldn’t be feeling burnout and you should be able to choose to put some profit to growth and sustainability.
Renewal or Decline:
I will fully admit, I don’t acknowledge this phase in my own business, or my clients’ businesses. There is a very good reason for this though! If you’re watching your business closely and monitoring it, you’ll know if it starts to decline and hopefully you’ll do something about it. “Renewal” is something we call pivoting, re-branding, etc. You should never let your business get to the point of decline, this means it’s losing its worth, power, and viability.
How do you know if a business is in a growth phase?
So how exactly can you tell if your business is in a growth phase? Well, to start off, you should be able to keep your pricing balanced with fair increases for new clients. The clients you started with should be hitting the 3ish mark point in your business relationship. You also shouldn’t be concerned about making payroll anymore and turnaround for staff shouldn’t be an issue. If you can look at your business (or your clients) and see these factors, see the steadiness, then you can say that the business is in a growth phase.
What does the growth phase require?
So, let’s say you’ve concluded that your business is in a growth phase, what now? First off, try to keep your confidence, if your business made it through the startup phase and into a growth phase, you should congratulate yourself.
Being in a growth phase and succeeding requires you to look at a few things and educate yourself. As with everything in business, you need to keep your drive up and hold the capacity to continue in your education. The growth phase is where you can choose two different directions, I legit imaging the board to The Game Of Life in my mind here. Sad but true. Take the college path, or the career path. One isn’t necessarily better than the other, it’s just suited to what is best for you.
This phase of business requires some type of investing to keep going. That can come either in the form of giving back from your profit, or finding outside investment in either investors or debt. This is going to depend on your personal situation, the type of industry you’re in, the type of business you’ve started, and other factors. The growth phase also requires something from the owner, solidifying current relationships and business models. This is the perfect time to look ahead and start analyzing what potential problems the business could face so that you can prepare for them and solve them as soon as they show up, or, ideally, prevent them from ever happening in the first place. This is also a really great time to start investing in your employees, make them feel and be part of the success of the company. Push them to begin taking accountability for client relationships, internal processes, and general growth of the business.
Do you have or manage a business? Let us know what phase you think it’s in below, and ask any questions you may have about getting the coveted growth phase!