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The Growing Pains of Business
But what happens when the organisation that has grown beyond its original skin and needs to mature into its next stage of its development? The early days In the exciting early stage, the business is all about survival, winning customers and creating a sustainable place in the market.
Eventually however, as the business grows and more people are involved, this seat-of-the pants way of working will no longer work.
Subordinates will want more certainty of direction, consistency of management style and will naturally become concerned about their own situation and future development This is a crucial stage in an organisations development, where the original founders of the business need to recognise their original ways of running the business will need to change.
The next phase From a sales and customer strategy point of view, the organization needs to formalize three key areas: Strategic Direction In this next stage of its development, the business may well need to refine its original product offering, drop certain elements of it and add additional products and services to complement its customer offer.
Additionally, the business may well need to redefine its principle markets, reconsider its competitive positioning and decide who its key customers are.
These are strategic questions for the organisation as a whole and should involve those people and business areas that will be responsible for making this revised strategy happen.
Role Definition & Structure This strategic business review is necessary before any changes can be made to what the organisation expects its people to do.
Most organisations have gone through the early stages of their development without such things as formalised job roles or job descriptions; given that speed of response and flexibility have been the key issues during early business growth.
However, the advantages that a totally flexible and fluid structure provide to a small organisation, where decision making and implementation takes place within a core group, can work against the effective working of a larger business.
In larger organisations, knowing how decisions should be made and who should be involved in making them needs to be defined.
Additionally, those responsible for implementation together with the ideal way that things should be done, need to be agreed and communicated.
Development of organisational capability Having an agreed strategic direction with more formalised organisational structures and operating processes, provides the organisation with the opportunity to develop its overall capability.
From a people point of view, this means the creation of training and development plans to develop personal effectiveness across the business.
This will create a climate of motivation, but will also help the founders identify those managers who will eventually run the business to provide the founders with a possible exit strategy.
Conclusion As a business grows, the need to reconsider strategy and to add more formalised structures and processes to enable the larger organisation to operate effectively, will challenge the original founders to embrace increasing complexity whilst maintaining flexibility and speed of response.