Download your FREE guide: "5 Proven Ways to Rapidly Scale Your Business", you will:
- Understand the difference between growth and scale and why growth doesn't always turn into profit
- Learn how reducing the variation in your products/services can significantly decrease the cost to service your clients
- Appreciate that by keeping management from getting bogged down in details, they can focus on more strategic, value-added activities
- Understand how outsourcing non-core activities is requisite to scaling your business
- Realize how improving your daily processes can reduce inefficiencies and drive profitability
- Discover how you can use time zones to support and respond to clients more quickly
"Enshored team has been extremely instrumental in scaling up our operation. From data entry, audit, to customer service, we could not have achieved all of this without their significant help."
~ Siqi Mou, CEO and Co-Founder, HelloAva
"We've partnered with Enshored for three years and have been really happy with the service levels and their flexibility as our business has grown:
- Steve Wiesner, CEO, PelotonRPM.
“Our company doesn’t have a traditional business model, but Enshored has been able to accommodate our unique requirements. From the beginning, the Enshored team has been incredibly flexible and easy to work with.”
- Debbie Shen, Director of Operations, Rocksbox
Growth vs. Scale
There’s a difference between growth and scale. In fact, there’s a multitude of differences. From the definitive standpoint, growth is the simple increase in revenues of a business. Scaling is the ability for a growing business to improve profitability at a faster rate than revenue growth. It’s an active process, and it’s an important one. Why? Because when it comes to the way that business is run, every company needs to grow before it can think about scaling.
Savvy business leaders are attempting to grow AND scale. The reality of doing so presents some interesting challenges. As with anything that is expanded and hopefully improved, growth requires some discomfort. Growth brings new obstacles and more complexity. It’s important to see the obstacles not as roadblocks, but as key milestones on the way to where you want your company to end up.
Since scaling is an activity that’s going to affect every aspect of your business, you want to do so as rapidly and painlessly as possible. Here are 5 tactics we have seen companies use to scale their business quickly.
- Reduce Variation
- Make Sure Your Management Team is Fully Focused on the Core Business
- Outsource Non-Value-Added Activities
- Improve Your Processes
- Take Advantage of Different Time Zones
Scaling is the ability for a growing business to improve profitability at a faster rate than revenue growth.
1: Reduce Variation
Many companies grow through the addition of more products and services. That can make sense if the rationale behind doing so is cohesive with their overall portfolio. That means leadership has spent time rationalizing decisions around not only product additions, but sunsetting older products or discontinuing services. The result of not doing so is an overly expensive operating model which makes it difficult to scale and optimize profits.
We all know it can be hard to say goodbye to “fan favorite” products. It’s critical to take a close look at every product’s rate of growth and margin. Every product in your portfolio should lend toward a leaner operating model and quicker profits. Also consider what will happen to buyers of items you will no longer offer. Ideally there is a way to transition them to other products to keep your numbers trending upward.
2: Make Sure Your Management Team is Fully Focused on the Core Business
Consider what the ultimate goal of your business is – what are you trying to sell, and how can you do more of that?
As businesses grow, they get more complex. That’s just a fact of life. The problem is that this can force your company leadership to get bogged down in items that don’t contribute directly to this core goal.
Time is Finite
Each of your business leaders only has so much time in the day. Every hour they spend working on the dealing with customer issues, working on administrative tasks, or other non-value-added activities is an hour they aren’t contributing to the core mission of your company.
Opportunity costs in this area are bigger than you think and can seriously hinder you.
Companies that scale the smart way are aware of this and put a framework in place so that management can delegate and execute on their to-do list without taking away from key initiatives.
Get help from experts in fields like legal, recruitment, facilities, finance, tax, and operations. Consider adding a fractional CMO or CFO and other outsourced assistance. Doing so is not a sign of failure – it will be your rallying cry to focus on the core, and the future.
3: Outsource Non-Value-Added Activities
As businesses grow, processes naturally need to be added and tweaked. Some of these add real value to your bottom line, but some don’t. Many companies claim that their customer service function is a real value-add, but do you have data that proves you actually add customers because of it?
It’s very hard to do everything perfectly, and the implication of spending too much focus on non-value adding work is that the core business functions are being underserved. That doesn’t mean that those processes should be forsaken or done with less effort, however.
This is where outsourcing can be a game-changer.
It’s essential for growing companies to seek outside assistance, but the following conditions should be met:
There is enough scale in the process.
An outsourced partner can be found who will not only deliver the same or better level of service, but for less management oversight and ideally a lower total cost.
4: Improve Your Processes
When businesses are growing rapidly, the focus is generally on revenue and getting more of it, and not necessarily on how you deliver that product or service. This can create large inefficiencies in the daily processes that your team are working on. In particular, growing a business can be like reinventing the wheel as there is no time to go outside and work out how others solve this problem.
By avoiding process optimization, you’re likely leaving significant margin or revenue on the table. Poor process design means that your teams are handicapping themselves. You’ll likely have teams that have grown more quickly than they had to, or worse, you’ll have missed revenue opportunities as the team has been down in the (wrong) weeds following poor processes.
It’s essential to make the time for regular reviews of all frequent business processes. This isn’t always easy when you’re in a high growth period – but the management team should set aside time after reviewing each internal financial report to identify areas for improvement.
Circling back to point #2, outsourcing partners will often proactively offer suggestions on how the processes they operate for you can be improved, and what implications this will have for your ability to scale faster.
5: Take Advantage of Different Time Zones
When a company is just starting out, having everyone in one office can have a lot of advantages. That energy is hard to replicate! But there are some disadvantages, and those become apparent as a business grows.
Have you ever had an issue with a product, only to realize you need to wait until the next day (probably your own work day hours) to call customer service? That’s because many customer support departments are based on the company’s normal hours within the head office. The problem is that customers may need support outside of those hours, and may even be in different time zones or countries! In another example, teams like software developers may not be able to take full advantage of having a “follow the sun” structure where they can pass on each day’s work for review and QA while they sleep, so that they start each day with the best possible code baseline.
Is the solution to open more offices or keep your customer service desk open 24/7? Obviously not. Finding ways to mitigate these challenges generally requires looking to outsourced partners who either have 24×7 operations or are in a time zone that allows you to start following the sun each day and seeing shorter project completion dates.
Scaling Up With Enshored
Growing your business is a terrific goal, but you also want to scale. Working with a trusted and experienced partner will help. Enshored is purpose-built to solve the challenges related to scaling disruptive, high growth businesses like yours, delivering proven results by employing our unique agile operating framework and the most highly skilled associates in the industry.
Rapid business growth brings many challenges. Outsourcing with Enshored makes it easier, more profitable, and less risky.
Enshored have helped over 75 companies to grow and scale in the past six years. During that time we have helped our partners try new ideas, expand coverage models, and enter new markets. We have proven to be expert at scaling rapidly with excellent productivity and quality outcomes. Significantly, over 40% of Enshored’s clients are referred to us by our other happy clients.