Scaling Your Business With Agile Leadership
Agile leadership is nothing new.
One of the greatest advantages of being agile in a business context is that it allows for easier growth and scalability. Scalability is one of the key components of business growth; it’s what we all lean on heavily as we look to exit our businesses.
One of the biggest assets for a business owner is an agile workforce (also known as a contingent workforce). Structuring labor around responsiveness to the demands of client and customer needs allows owners to gain expertise or project ownership for the short-to-mid term without a heavy investment in long-term overhead or management. And while many organizations have used “temps” to keep low levels of the org chart responsive, an agile workforce is an option at all levels of the organization, including the leadership level.
Being able to borrow top-level leadership talent as needed on an interim, fractional or project basis is a business owner’s secret weapon to scale the business.
So, why is scalability so important?
The most common reason an entrepreneur starts a business is to eventually sell it, hopefully for a profit. In such a business, the number one focus is growth. A number of components that factor into the value of a business when the owner is ready to sell. Top-line revenue is important, but bottom-line profitability needs to be there as well. In order to maximize value in a business at the time of sale, the company needs to be scalable.
When growing a business as fast and as big as possible is the primary driver, with growth comes inevitable growing pains. The business hires rapidly, ramping up from a few people doing everything to multiple people. and each person begins doing tasks from processing customer orders to product delivery a different way. This causes daily fires to put out, mounting frustrations, and costly mistakes. All of the knowledge of the organization’s operations and institutional history is trapped inside everyone’s heads; nothing is accomplished consistently, or even necessarily in the most efficient way.
As these “little” annoyances mount, they become costly to the organization and margins start to erode. The common saying is, “I’ve never worked so hard for so little in my life.”
Scalability is a product of intentionally orchestrating all the business and operational tasks in the organization both effectively and efficiently. Being a scalable business provides a number of advantages:
- Ability to hire more easily, since the skill sets needed are more narrow. Rather than finding talent who can fit a range of expertise, roles and responsibilities are more specific, which broadens the talent pool to be pulled from.
- Ability to train quickly, since all processes and procedures are documented. The learning curve is greatly reduced.
- Ability to increase production or revenues without adding the equivalent number of FTE.
- Repetitive tasks may be automated and any non-value added activities can be removed.
- Ability to react to the changes in the marketplace.
- Ability to capitalize on marketplace opportunities.
Whose Job Is It To Scale The Business?
If designed scalability is so important, with many clear advantages, why are so many business owners challenged with scaling their business?
Put simply, building organizational scalability is itself a skill, and most start-ups don’t have an expert in-house.
When you’re involved in the day-to-day of running a business, it is difficult to step out and get a clear picture of what needs to be done and how. Recognizing the growing gaps in your leadership team intensifies the sense of urgency to just get today’s problems solved, since the owner ends up wearing multiple hats and forgets about the most important hat – the hat of the CEO.
As the CEO, once you’ve identified your leadership gaps, you can then focus on filling them and moving on to the next priority: An intentional, rationally paced set of initiatives that lend most to scaling your business.
- Key areas that require attention in nearly any business scaling strategy are:
- Knowing which way and where you want to grow the business
- Understanding which KPIs are most important (the ones that will drive the business)
- Identifying repeatable, documentable systems, dependencies and processes throughout the business, in every functional area
- Clarifying how your product/service solves a problem in the marketplace
Interim, fractional, or project leadership is available in all functional areas to help strategize, advise and execute on scaling a growing business to profitability and beyond.