Have you ever watched the classic television show This Old House? Imagine you’re on it, working on a 75-year-old house with its original electrical wiring and plumbing. What would happen if you plugged in a full complement of modern electrical appliances? You’d blow your fuses, not to mention create the potential for an electrical fire to break out. And what would happen to your plumbing if you went from a well-water system to tapping into the higher pressure of city water? (Can you say rain gear?)
Likewise, too much growth that makes increasing demands on old, outdated systems is what causes most growing businesses to fail. The systems that worked for a $500,000/year business are no longer sufficient to cope with a $5 million business, and not even close to being adequate for a $50 million business. At first, the additional sales will cause a few “leaks,” but before long, your business will have burst pipes and water everywhere. That’s where “scalable solutions” comes into play.
Scalable solutions is concept prompt for you to always be making choices in your business that will scale, that is, choices that will still work when you have a magnitude more volume through that system.
For example, imagine you were building a web platform to process orders from your field sales force. When evaluating which platform to purchase, a savvy business leader would choose one that could handle the high transaction volume you eventually want to have, provided the cost for this greater capacity isn’t too high. If the cost doesn’t make financial sense, consider a smart alternative. Choose a platform that can be easily upgraded later as your sales volume increases and you have the excess cash flow to warrant the upgrade. You’d say “no” to any platform that couldn’t handle your expected sales volume or be easily upgraded and expanded later.
We deal with this every day with our business coaching clients, most of whom are growing at 5-7 times the national average for privately held companies. They must constantly be vigilant about making “scalability” a criteria for any new system they are developing, investing in, or implementing. You should do the same.
Scaling your business requires building it in such a way that your model and systems can be rolled out and replicated on a much bigger playing field. When you’re solving a business challenge, you must look for solutions that can be scaled.
Today’s article was a shot across the bow, and the biggest take away I hope you gained is to make “scalability” a stated criteria for your systems decisions.
For more specifics here, I’m in the works of two new articles on this subject. One is on scaling “expert systems” – how you can replicate a scale things that relay and pricy, highly skilled talent, such as what you’d find in a professional services firm or consulting practice. I’m almost done with that article so look for it next week.
The second is on a “quick list” tip sheet on the best practices in building scalable systems. That will be available in the next 2-3 weeks.
Finally, may I suggest that if you want more ideas on growing your business, including a free tool kit with 21 in-depth video trainings to help you scale your business and get your life back, just click here.