Every business wants to grow sustainably and in a scalable way. However, the percentage of companies that reliably grow year over year is about 50/50.
As a business owner, you want to be part of that growing 50%, not the failing half of businesses.
So, how do you do this?
In a recent interview, Adi Klevit of Business Success Consulting Group discussed this issue with Matthew Pohl, CEO of The ReWild Group. During their talk, they shared a clear roadmap that helps companies all over the U.S. move through the stages of growth successfully and systematically.
Read on to find out more.
The Stages of Company Growth
Businesses often get stuck in one stage, perhaps at the small or medium business level, and then fail to scale.
During their discussion, Adi and Matthew talked about why this occurs. One key factor in stalling growth is the added complexity of increasing the number of employees a business has. As the number of staff grows, so does the complexity of communication, decision-making, and execution. That's why the number of team members, not sales or longevity, defines a business's growth stage.
Here are the seven stages of growth, based on headcount:
- Stage 1 (1–10 employees): Startup
- Stage 2 (11–19 employees): Ramp-up
- Stage 3 (20–34 employees): Delegation
- Stage 4 (35–57 employees): Professional
- Stage 5 and beyond: Complexity continues to increase as the business grows.
Most companies get stuck during the transition from one stage to the next, as they need to make substantive changes to the operations to ensure consistency across the board. These transitions are made insurmountable by failing to establish:
- a) Processes that all can follow.
- b) A business model that is set up for growth.
- c) A firm organizational structure.
- d) A development or training process for managers and those aspiring to join management.
People, Profit, Process
All businesses must focus on three elements: people, profit, and process.
When in the early stages, business owners focus on profit first, then building processes to ensure consistency, and, finally, they invest in more people to continue to scale the business.
However, developing and hiring people must become a priority as a business grows to stage three and delegation begins in full force. Then, there is profit (of course, because you have to keep your business afloat), and you must continue to document and utilize processes.
Finally, as your business grows to stage four and beyond, priorities change again. Your teams must focus on defining systems to implement automation and other tech tools that allow your company to scale and keep your teams working on high-level and customer-centric activities. These processes must reinforce and continue to grow the profit margins, allowing your company to grow and capture even more market share as your team expands.
At the end of the day, a business must have a self-sustaining infrastructure. It must make the income required to train existing employees, hire new employees, pay for process consultants, and build or purchase software. Recognizing the stage of growth your company is in and refocusing your business goals accordingly will help you to create sustainable growth in your business.
A Note About Delegation
Delegating is one of the hardest things for business owners to do. It can feel like a real make-or-break point. Matthew emphasized this during the interview, and we have talked about the struggles business owners have with delegations many times here on the blog.
Delegation requires that founders step back and leaders step up. Effective delegation means more than just assigning tasks—it involves:
- Clarity on what decisions others are empowered to make.
- Building a competent management team.
- Using tools to ensure leaders focus on what truly moves the business forward.
And most importantly, it's about trusting your people and investing in their development.
As you continue to build your business, it is vital to step back and determine whether a founder or CEO should complete the critical work they are doing or if it can be delegated. In this regard, ask yourself, "Would I pay someone else my salary to do this work?" If the answer is "No," then it's time to delegate, whether you enjoy the work or not.
If you want to scale your business, you must recognize the areas that need the most support and build teams and systems to ensure continued growth. Connect with the systems experts here at Business Consulting Group to take that next step. Schedule your initial free consultation by clicking here.
