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Managing Problems Associated With Rapid Business Growth

March 30, 2016

So, your business is growing, and quickly. That’s great! However, there are some cases where the bubble grows so quickly- and  bursts. This is why rapid business growth is exciting, but nerve-wracking for any executive. The common problems affiliated with rapid business growth affect all aspects of your company, from management and employees, to the physical workspace, to your customer relationships.The first step is to identify these problems before they yield negative outcomes.

What Happens to Centralization and Standardization?

One of the first requirements of rapid expansion is to implement and develop new departments, locations and tools. Whenever you add more of any one of these, decentralization increases and standardization decreases. A negative effect is a lack of communication between silos, resulting in a lack of understanding across departments and locations. You may see the corporate standards fade, changing definitions, metrics and even entire processes.

Disparate Systems and Inaccurate Reports

An even worse effect of this is an increase in disparate systems. Many disparate systems are detrimental because data and information coming from disparate systems is not well integrated; thus you are not getting the complete and accurate information that is needed to make the best business decisions. You might be getting bits of information, but many times it is confined within certain silos. The most common response of management in this situation is to pressure reporters to give you more complete information and reports. Unfortunately, a common consequence of this is manipulation of the data- which only gives you the ability to make misinformed decisions.

Employee Consequences

But it’s not just management that suffers from problems with newly-introduced, disparate systems. It’s all employees that have an interaction with the system or the tool. They too suffer from a lack of communication between silos. Simultaneously, they are required to learn how to use all of these new tools. Frequently when software companies, or companies that sell you the new tools come to install them, they know exactly how to deploy them, but not how to use them. Therefore, they do not help you implement the tools, nor do they ensure you and your employees know how to use them properly and to their full potential. This only puts more pressure on your staff.

This is one of the first signs that your staff may become dissatisfied. As your company grows and grows, the demands of individual employees also increase- they must learn new tools, and accomplish more in any given work day. This will likely result in a tired, stressed out team with low morale. What do you get when you have a stressed out team that is unable to communicate seamlessly? Petty arguments.

Your employees are now unable to meet skyrocketing demands, unable to effectively use new tools, are stressed and no longer feel a part of a unified team. These employees are far more likely to decide to leave, exacerbating the problem for management. Because now, management must focus their attention on hiring, rather than managing. New hires only add to the confusion and chaos, not reduce it.

New Workforce

So let’s say you do hire more employees. You may not immediately have the physical space to hire and train all the employees that are needed to fulfill all the duties that your customers expect from the company. This is likely a time when you might open new branches; only increasing decentralization. As your locations and your people become more and more disconnected with you and the center of the company, how can you be sure the original values and standards are being taken in and valued? During rapid expansion, it is much easier to lose touch with your company culture, especially when many of your earlier employees have left.

Loss of Customer Relationships

It is at this point that your disconnect with your customers has grown too much. The employees that once held the company values and delivered your standards are gone. They are replaced with new trainees and new systems. But the new systems are not running seamlessly, causing more hassle for the customers, and giving you less feedback on their experience.

You are likely to begin losing even your most loyal customers, before you can do anything about it. Due to the disparate systems, you are likely to have too little timely and accurate customer data to make this discovery before it is too late. This is a huge problem because retaining loyal customers is vital to your success. Loyal customers are worth up to 10 times their first purchase. Now you are tasked with finding and retaining new customers which is costly.

Can You Prevent These Problems?

Ultimately, this chain of negative consequences will result in a loss of profit. Once you are in the midst of these problems, it is difficult to address them. However, if your company is rapidly expanding, you can take preventative measures to ensure this is not your fate.

The first thing to address during expansion is system integration. Cliintel is able to take the data from your disparate systems, providing you with accurate, complete and timely data. They also conduct data analysis to help you identify problem areas, then develop and deploy solutions quickly. Our clients typical see improvements within a month, and experience ROI improvements in just a couple months.

We also help our clients enhance the previous implementation of tools. We ensure you and your people are using your tools to their full potential. We can even conduct trainings to make sure your employees are using them properly, reducing a great deal of stress for them, while simultaneously reducing user error.

We can even help you increase the productivity of your workforce. We have increased previous clients’ worker productivity by 15%. We’ve also helped them repurpose internal resources that were not utilized as effectively and efficiently as possible. We re-matched a clients’ employees with more appropriate roles for their skillets. This increased their workload distribution and resulted in a hard dollar savings of $90,000 per month.

Therefore, we can help prevent each of these negative situations from occurring. We help you keep things running as seamlessly as they did before the rapid growth and chaos, so your customer continues receiving the same quality of service they expect from you. We helped a client improve their net promoter score (customer loyalty) by 40%. Find our more about what we’ve done, and what we can do for you. 

 

 

 

 

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