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Your Small Business Needs to Prepare for Survival When It Grows Featured

Your Small Business Needs to Prepare for Survival When It Grows Nebula

Small businesses often go through many challenges as they seek to cement their place in a competitive business landscape. According to Harvard Business Review, companies go through various stages of growth from their inception to maturity. Accordingly, each business starts at the startup phase. However, not every one of them reaches the highest level, such as those reached by companies like Apple and Microsoft. According to HBR, 92% of high-growth tech startups fail even before reaching three years. This is a worrying trend for entrepreneurs, with only half the businesses remaining operational five years after being founded. Since the challenge has proven to be real, here are some things you should consider as you prepare for the survival of your business.

Work on your organizational chart

Predicting what the future holds is not an easy thing, considering the fluidity of the business landscape these days. However, planning for the success of your organization and potential growth will save you from a lot of problems in the future. As a leader, avoid doing everything yourself. Rather, learn to delegate some responsibilities to the existing employees and possibly hire others to take up the increasing responsibilities. Give the people you trust tasks and clear expectations from you. Ensure that each employee understands who to when they have questions.

For small companies, delegating duties can be a challenge, particularly if the hierarchy is not expansive and for firms that depend on a flat hierarchical structure to manage employees. As you grow, you need to add more levels and additional structures in your business to enhance management efficiency.

Keep focusing on the product

While focusing on the growth of your organization, ensure the quality of the product remains the same or grows with your status. While this may seem obvious, it is not always the case for many companies that focus on growth while forgetting that success is always linked with the consistency of products or services. Most startups fail during the rapid growth phase, with quality issues being among the top contributors to such failures. Due to the fast phase of change, the company’s internal structure can be overloaded, and the delivery of services can be affected substantially. As a growing company, always look into the quality of your product and don’t let it slip. Your products need to adapt to the change. Ensure the processes, systems, human resources, and finances are in place to keep up with the spike in demand. Whenever you make changes to your products, let it be an improvement and do a thorough analysis of the market. Let the customers know the reason for the change. Communicate to them clearly, honestly and in advance so that you do not catch people off-guard. Proper communication will enable the customers to see the change coming and adapt accordingly.

Focus on profit, not revenue

As businesses grow, money may come in fast and in large qualities. However, such revenues can be misleading if used to measure success since most of the revenue may be used to settle other needs such as logistics and workforce and expand the product. Therefore, as a growing company, you should know that high revenues can hide a sick company if the top echelons of the organization focus mainly on revenue and not the profit coming from services or products sold.

While actions such as adding employees, investing in improving products and adding new positions are good, companies need to focus on profits. Resist the urge to glorify money coming into the company. Rather, ensure you clearly understand the profits that your business makes.

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Scott Koegler

Scott Koegler is Executive Editor for PMG360. He is a technology writer and editor with 20+ years experience delivering high value content to readers and publishers. 

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