By Bruce Johnstone, Director of the Business Growth and Development Programme at Cranfield School of Management
The team that delivers the Business Growth and Development Programme (BGP) at Cranfield School of Management have uncovered insights into what it takes to grow a business and stress ten steps that are vital for business growth. Business owner-managers who attend a briefing session for the BGP participate in a discussion of these ten steps led by Cranfield Visiting Fellow, Mark Kelly.
Step 1: Keep the Passion Alive
Passion is the vital ingredient that drives business growth. The owner-managers of fast-growing businesses are three times more likely to be “as passionate about the business today as when I first set it up”.
Step 2: Become a Strategist
Successful owner-managers often begin as Artisans – people good at doing the work of the firm. As the firm grows they take on roles as Hero or Meddler. Ultimately they need to take on the role of Strategist if the firm is to grow.
Step 3: Know Where You’re Going
Over two-thirds of the fastest-growing firms have written business plans (compared to 44% of slow growers and decliners). The Business Growth and Development Programme (BGP) at Cranfield creates an environment where business owners can forge a plan for growth.
Step 4: Stick to the Knitting
Focus on supplying existing products or services to existing markets. Get this right before moving into adjacencies. Trying to grow by supplying new products to new markets is a risky approach which Mark Kelly calls “the stupid box” of the growth-market matrix.
Step 5: Know Your Competition
Successful growers are always one step ahead. Aspire to greatness and ask what can you be great at? Always benchmark against the ‘next division up’ and focus on how you can win. Be ready to seize the right opportunities and ‘Bet Big’. Kelly explains that all businesses have a “biscuit tin full of opportunities” and, while the process can be a bit like “drowning a puppy”, it is also vital to know what to say ‘No’ to!
Step 6: Know Your Numbers
Champion growers know that what is really important is cash and profit. Focus on profit – don’t be what Mark Kelly calls a ‘busy fool’ and pursue turnover that does not boost profit. Less than a third of SMEs across Europe set objectives in terms of profits and margins. Remember Cash is King, create a commercially savvy management team and employ a good finance person.
Step 7: Grow Up!
Successful growth businesses become ‘small, big businesses’, not ‘big, small businesses’. As you grow, you need to change your people, processes and leadership style.
Step 8: Develop a Great Team
In fast growing businesses, nearly two thirds of owner-managers spend most of their time motivating and coaching their team. It’s what your people actually do that delivers strategy. Do you employ smarter people than yourself?
Step 8: Develop a Great Team
Firms which invest significantly in developing people are nearly all Champions or Profit Enhancers. It is what your people actually do that delivers your strategy. Owner-managers of fast growing businesses know this and invest in empowering and developing the people in their business. Nearly two thirds of the managers in fast growing businesses spend most of their time motivating and coaching their team.
Step 9: Learn to Balance
It’s all about you! YOU are a fundamental part of the challenge and solution to growth. Be more confident, become an accomplished leader, be bolder and courageous, invest in developing yourself, work smarter, not harder, work to a plan and work ON the business not IN it.
Step 10: Love Your Customer
Sixty per cent of customers leave because they feel indifferent about the service they receive. How many of your customers rave about you? Do you strive for customer service excellence? How much new business do customer referrals generate for you?
The Business Growth Programme at Cranfield School of Management is aimed at established businesses, usually with a turn-over in excess of £2m, and the capacity to grow. Over 1250 owner managers have completed the BGP which now runs three times a year at the Cranfield School of Management in Bedfordshire. Designed specifically for the development of owner-managers, the BGP helps you create the future you want for your business and for yourself. Find out more, and attend a special briefing event, by visiting www.som.cranfield.ac.uk
Dr Bruce Johnstone is a director of the Business Growth and Development Programme at Cranfield School of Management. He can be reached on firstname.lastname@example.org
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