By John Rosling, UK CEO of Shirlaws
We all know that being stuck in the detail of our businesses is often both stressful and unproductive.
But how much detail should you have in your in-tray? It obviously depends on where your business is in its lifecycle and on its size. But how do you know what’s right for your business today and how and when to evolve your role in the business?
For a start, a CEO of an early stage business has a very different job to one running a mature business. Your role changes year by year and to understand your priorities at any one point it’s vital to know where you are and what’s coming next.
All businesses have a natural lifecycle and go through clearly identifiable growth stages. These stages are not based on set periods of time, but rather on “energy” within the business. It is this energy, or ‘feelings’, of the key players in an organisation that will dictate at which stage a company is and when it moves from one stage to another.
At Shirlaws we have worked closely with hundreds of businesses all over the world and using this experience have created a model of this progression we call the “Stages model”. This model applies to every company, regardless of size or sector.
This is a somewhat simplified version of our model. It shows each stage or phase of the business’ development and the feelings at each phase shown in red below the timeline. These feelings are a remarkably accurate indicator for precisely where the business lies on this timeline. Using data drawn from thousands of businesses we can then support our clients in understanding how they can navigate their business along this cycle and exactly what the business should be doing at any point to maximize returns - both commercial and cultural.
The first stage is the ‘Start-Up’ phase which begins on day one of the business. Remember how you felt on that day? Excited, nervous? Your energy levels were high, you were doing everything in the business; working long hours — it was frantic, but you loved it. You were investing time, energy and money into the company. If you hadn’t invested so much and worked so hard, the company would have failed quite quickly because that initial phase is tough; you need to win clients, get a reputation, and establish a cash flow. That hurdle is what we call the ‘First Brick Wall’ and to get through it you need to make that investment .
Because you work hard, the business begins to fly, and you get to the second or ‘Growth Stage’ when the company is doing well, turnover is growing and you begin to feel good about how well everything is going. These are the good times when you begin to reward yourself for all your hard work in establishing the business. Perhaps you move house, buy a second home, a new car or boat — you deserve it after all. It’s payback time.
But now you still seem to be working seven days a week, taking work home, going in at weekends - and the business is not growing at the same rate. There are more people in the company, so more day-to-day problems to solve. You are doing everything you did before — and more. At this point your feelings can best be described as frustration and stress and, eventually, disillusionment. You are at, what we call, the ‘Second Brick Wall’.
Now this is a crucial stage for any business. There are three options: you can get through the wall and take the business forward, the business will plateau or it will decline.
The crucial element to get you through is further investment, and this time it needs to be investment in skills. The business has changed and, unless you had a planned strategy for growth, you need to assess what your role should be (you shouldn’t still be responsible for running everything in the business) and assess the roles of everyone in the business — how well are you delegating responsibility? You need to reassess how the company is positioned in the marketplace against the competition and customer expectations. Sales methods need to be reviewed. Are there the right skills in the organisation for the business you now are? And what about your plans for the future — do you have a planned succession strategy?
If you recognise the needs of your business at this stage and invest in putting the right strategies in place, then you move into ‘Advanced Growth’ and start to feel contented with work and will have achieved a good balance with your life outside the office. In fact most business owners simply say they feel enormously “proud” at this point. It’s the feeling that successful serial entrepreneurs have. They have worked out how to get their business to work for them.
So, how does your business feel today? Is it an excited and frantically busy place? Calm and relaxed? Or stressful and increasingly frustrated? Understanding that will tell you what you should do now and what is coming up in the future.
How do you feel? You may be in a different stage than your business or your key team. Understanding that will help you know how to manage your relationship with your team and give you an insight into what skills you might personally want to develop.
Naturally, the capabilities and skills needed to shift through the Second Wall can be planned into the business as you accelerate up that growth curve. The more of these you build in while times are good, the less painful the Second Wall will be. Culture is also hugely important, as businesses with a strong culture and a clear vision avoid much of the stress and disillusionment.
But to really invest in these core long term capabilities you need some genuine perspective — to be ahead of and “above” the business. The trouble, of course, is that in the good times phase we are all too busy in the content, focused on clients and revenue creation (and having a good time), and as we move towards that Second Wall we are still in the content but now too busy fighting fires. That’s why managing in context is so important (and difficult to achieve).
To find out more you can download my new book for free at www.shirlawscoaching.co.uk
• Know where you are in your business lifecycle and plan ahead.
• Know where your key Directors or Partners are and understand how this impacts on your relationships and decision making.
• Build in now the skills and capabilities your business will need to grow in the future.
Understanding where you are in your business lifecycle is hugely valuable information for you as a business owner. But how do you act on that information to structure your business and your people to get you out of the detail and into the far more profitable (and fun) role of the entrepreneur? That’s what I’ll cover in the next two articles: 'The Fully Functional Business' and 'Capacity Planning - The Secret To Controlled Profitable Growth'
Shirlaws is an international business performance and coaching company. We help business owners achieve their business and life objectives. Our programmes have changed the lives of thousands of business owners all over the world by removing barriers to growth and ensuring their business pays them richly in money and time. What Shirlaws brings is a language and system for growing businesses and building internal capability. A language and system that gives our clients three simple things: more time, more money, and less stress. Founded in 1999 Shirlaws has now grown to include operations in North America, UK, Europe, Middle East, Australia and New Zealand. Our coaches take the many complex issues involved in running a business and help make them simple and easier to manage. We work alongside clients to guide their businesses to achieve long-term, profitable and sustainable business growth.
Join us on