Women In Business

5 signs your business needs more structure

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How do you know when your business needs more structure – and what can you do about it? A business becomes self-sustainable when it has a repeat client base, with new business coming in the door on a regular basis either through sales and marketing activities or referrals or a combination of both.

There is a team in place which may be small or large depending on how rapidly the business is growing, and it is starting to make money.

Once a growing business reaches this stage, it represents a huge shift for the business owner and is probably the most important stage in transitioning the small business into a bigger business.

The person or people who started the business are no longer the only ones in it and no longer do everything. They need to delegate to others, plan ahead and grow their own roles in order to move through this stage.

Dealing with the complexity that comes with this stage is a huge learning curve for most business owners who have never been in a situation like ‘the stage 2 business’ before.

A lot of the knowledge of how things work and are meant to work is in the head of the owner, and when things reach crisis point with too much going on at once, the solution is to throw more resources at the problem. Hence the complexity continues to grow.

Many business owners run the risk of this happening when they approach Stage 2. Some fail to really understand the importance of building structure, and continue to focus on more growth and the irresistible desire to take all opportunities that are presented. If you neglect structure your business will fail. It is essential to take stock and build structure at this stage, so you can continue on your growth path.

 

It is at this stage that the game changes. When you start to see any of these signs, you will know for sure that it’s time to put more structure into your business to enable it to continue to grow:

Signs that something isn’t right

  • You don’t feel in control of what’s really going on: Your business has grown relatively quickly and you have lots of new clients and work, but you and your team are feeling a little out of control with all the growth.
  • Mistakes and problems are occurring more frequently
  • There’s uncertainty how to get things done: You have a team of people, but you seem to be the only one who knows how everything is done, or meant to be done
  • The owner is ready to crack: You are overwhelmed and exhausted by trying to keep it all together
  • People aren’t performing: One or more of your original team is no longer performing, placing extra pressure on you

 

What has happened is quite typical of growing businesses:

  • The owner of the business hasn’t had the need or the time to document what she knows, so it remains largely in her head
  • As a result, her team aren’t quite sure what they have to follow up on, or take on, or even how to do it without asking her a million questions. That’s why many business owners at this stage wonder why they’ve employed so many people when they still end up doing most things themselves.
  • They hold on tighter to what needs to be done, as they often believe that in the circumstances, if they want something done it will be easier and faster to just do it rather than delegate it
  • This increasing load on the business owner takes them to breaking point
  • The team meanwhile is trying to be supportive but is not sure what they’re meant to be doing or how to do it, because this information resides in the business owner’s head
  • Early recruits are often given way more responsibility than they are able to shoulder, as the company grows. The owner keeps expanding their role beyond what they’re really qualified and suited to do. As a result, they start to falter under the load and stop being effective, but they don’t want to let anyone down.
  • No-one has had the time or the availability of the business owner, to take information out of her head and put it into a format that can be accessed by other people in the business
  • The business owner effectively causes a bottleneck in the company, by not letting anything go forward until she has overseen it, amended it, corrected it, viewed it or approved it.
  • There is a lack of coordination amongst people and projects, because there isn’t are no processes that tie the different parts of the business together.

Sitting at the centre of all these challenges is typically a business owner who is inexperienced in making the changes that need to happen at this stage of growth, and is reluctant to let go.

It is only when she lets go and shifts her own role to that of a CEO whose job it is to implement structure, organisation and processes so people can effectively support her, that the company will be stronger and able to keep growing.

About Jenny Stilwell

Jenny Stilwell is a strategy advisor and mentor to CEOs of small and medium sized companies, providing advice, clarity and focus on the right strategy and structure for different stages of business growth. To receive fortnightly ‘bite-sized’ videos across a range of challenges and questions facing small business CEOs, sign up for C-Class at http://www.jennystilwell.com.au/c-class

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