So much of our success in business is measured by growth: growth in revenues, growth in client numbers, growth in Twitter followers.
In economic development growth is a solid indicator that things are headed in the right direction. Many were disappointed to hear recently, for example, that Prince George had only grown in population by 192 residents since 2012.
But lately, I've begun challenging my assumptions regarding business growth. Is Fortune 500's Fastest Growing Company list really the one to aspire to? Is growth at any cost truly the ultimate measurement tool?
It is important to look beyond the opportunities of growth in order to recognize the risks of growing too quickly. If high growth measurables are part of your business plan, one that is well defined and developed, then your business will be ready to meet the challenges that come with growing very quickly. If they're not part of the plan, then you may want to slow things down to a manageable level that will allow you to match the product quality and service levels your customers expect from your business.
In such situations, pruning is not necessarily a bad thing. Just as you would prune your rose bushes from time to time to encourage concentrated healthy roots and growth, you may need to do the same to your business. Pruning may come in the form of reducing your client intake, the number of employees you are managing, or cutting out bad business habits. It is really about thinking of ways to work smarter, not harder.
Keep in mind that pruning bad growth to make room for good growth may actually end up increasing your profit margin. It sounds counterintuitive. Yet consider, for example, how certain clients take up the majority of your time and energy. While you spread yourself thin in order to keep these high maintenance clients happy, it is to the detriment of many other neglected yet loyal customers. But if you selectively and respectfully drop a few troublesome clients, you may consequently increase sales within the pool of remaining less demanding customers. Strengthen this revenue base and suddenly you're ready to increase your capacity to take on new employees and clients, thus making room for healthy growth.
Consider the original reasons you went into business for yourself. Was it to attain growth or was growth only one of many parts of your business plan? If you can keep growth in perspective and not lose sight of the things about business that you are most passionate about, you'll establish healthy balance in your business and retain the integrity of a well thought out plan.
Until next week, stay in the black and keep coming back.
