If you want to build a large company, then at some point you will have to expand. This is something that a lot of startups don’t consider until it’s almost too late.
There is lots of talk about how a handful of people built Facebook or Google, but not about how they mastered the art of scaling and managing their staff (Google now employs more than 20,000 people – that takes a lot of management!).
So over the next few blogs, I will be sharing my own experiences on how to manage the process of scaling up a company and the key things to implement.
Once you get into the fast growth stage and start bringing on-board other board members you’ll generally get two pieces of advice for scaling your company:
- Get a mentor who has taken a business from startup to large scale
- Hire senior managers who have been through scaling-up before and can manage large numbers of staff
I was told this and, while very good advice, I found it has some serious limitations.
Firstly, the old saying “you don’t know what you don’t know” applies here; if you don’t know anything about growing a business, then it’s very difficult for you to tell if someone else is right for the job.
Secondly, a lot of board members and career “non-execs” who are good when raising investment, know very little about scaling a company.
So, the advice is good, but you need to learn a few basics about growing a business before picking a mentor or hiring the best person to help with the process.
Easy becomes difficult
When your company grows in size, you’ll notice that things that used to be easy become more difficult.
In particular you will find the following three things that were simple when you were a small company often become complex:
- Common knowledge
- Decision making
Take the example of a single person company. That person does all the product development, marketing and sales and they manage it all themselves. They have complete knowledge of everything that goes on within the company, they don’t need to talk to anyone else and can make decisions very quickly. As soon as you add a second person you have started the growth phase and things will only get trickier!
However, if you don’t expand, you won’t be much of a company, so you need to make sure that these areas weaken as slowly as possible.
As you start to add new employees, you will find that things like specialisation, the company structure and all the new processes you have to implement tend to over-complicate things.
Feeling that you’ve lost clear communication and shared knowledge within the company is common, but it is important to implement these, otherwise you’ll stay small forever.
When you get to the point where hiring new staff is more work than you can handle, then it is time to delegate control of these key areas. That’s what I found anyway.
In the next post I’ll talk about role specialisation and the issues and solutions that worked in my business.
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