Growth and Scaling: What's the Difference and Why Does it Matter?
In early 2021, I changed my tagline to Be Ready to Scale®. Shortly after that, I was meeting with a prospect and he asked me, “Why did you choose the word 'scale' instead of growth?”
At first, I was taken aback. It wasn’t a question I was expecting as we were talking about his company and how I could help him. I was happy to answer him though. It’s what makes me different from my competitors.
I explained that growth is something that is usually thought about in linear terms—a company acquires new resources (people, technology, capital, or markets), and then its revenue increases as a result. It’s a regular or ongoing result.
In contrast, scaling is about increasing revenue without incurring significant costs. The intention is that as revenue grows, expenses only increase incrementally. When an organization is looking to scale, they have already achieved some level of success in the market but the business has plateaued for some reason. Getting beyond this plateau could mean the difference between going out of business or exponential growth.
This tipping point is when my clients usually reach out to me. They are on this plateau or in some cases, the Emergency Zone, and they have decided they want to grow. They’ve done all they know to do, but still need something more.
THE QUICK WIN
When I first start working with my clients the focus is almost always on a Quick Win. The Quick Win is a big project that is going to get them beyond the plateau and out of the Emergency Zone. It usually has an ambitious turnaround time with ambitious goals. But, it’s what they need to do to, in some cases, to survive.
As we’re accomplishing this goal, I’m laying the groundwork for auditing their business—from marketing to operations, to sales, to identifying how the organization could be more efficient. But since we’re focused on the Quick Win, rarely are changes implemented at this point. This usually lasts about 3-6 months.
After the Quick Win, the danger is that they will look for the next Quick Win rather than sustainable growth. To avoid this, our next step is “The Audit”. Since I’ve already seen how they operate in the Emergency Zone, I have a good idea about where their weaknesses and bottlenecks are beyond what they can articulate and have started to identify ways that they can steadily and reliably grow.
According to a joint study by the Kauffman Foundation and Inc. Magazine, roughly two-thirds of the fastest-growing startups end up failing. Research from California State University showed that companies that had fast revenue growth performed worse, long-term than their slow-growing counterparts. Other macro studies have shown that slow-growing companies tend to do better in the long run than their fast-growing counterparts.
When companies are in a fast-growth or Emergency mindset and have seen results, it’s easy to get caught up in more is better, faster is better. It’s almost addicting which can cause them to focus on more Quick Wins. Our Audit does not suggest that an organization shouldn't want to grow quickly, rather that it prepares them to be able to handle the growth, and offer quality products and services. Therefore, the organization grows, increases profits, and does so smartly in a way that works for them.
There are three main areas that our Audit looks at:
- Brand Building and Marketing Strategy—How you are positioned and perceived in your market, brand messaging and strategy, and how can you be more effective.
- Operational Efficiency—How the operations and technology in your business enhance experiences and reduce wasted time.
- Client Experience—How your clients experience doing business with you to drive repeat business and generate referrals.
Finally, once we've identified what works and how to improve their results, it's time to make it happen. I work with my clients to make the necessary changes. Sometimes this includes new tools, hiring new employees, or training and supporting their existing team. For many clients this includes researching various tools that are a better fit for their needs, selecting, and implementing them.
Sometimes it includes process development. I worked with one client who had no processes in place. Each team for each project did something different for tracking. No one kept up with any of the different process tracking methods so everything was treated as an emergency to get things done. Which was leading to team burnout, inefficient quality, and increased costs. Developing and implementing efficient processes across the company created accountability, streamlined workflow, increased quality, reduced stress on employees, and changed the culture of the organization.
Sometimes it includes looking at pricing structures. One client I worked with had a flat yearly fee that was paid upfront, but clients often left after three months. So, we created a new three-tiered pricing structure that offered more flexibility, which encouraged longer-term commitments and increased revenue.
Sometimes it includes building intentional funnels for attracting new clients as well as being able to provide more value to existing clients. You can be active on social media as is humanly possible, and you can pay any amount in online advertising, but if you don’t have the means to collect your prospects contact information and an easy way for them to do business with you, they will simply choose to do business with your competitor.
Sometimes it's about rebranding or brand messaging. If your target audience doesn't "get" how you can help them, then they will simply do business with your competition. With most of my clients, we go through at least a brand messaging process to simplify, streamline, and amplify the value that they provide to their audience. The goal is to make it easy for people to do business with you. I focus on a strategy that helps your audience "get it" faster so you can close more sales.
Omicle delivers brand clarity, marketing strategy, and operational efficiency to prepare leaders to scale their business. If you are interested in learning more about how we can help you, contact us today.
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