CUTTING EDGE - Work Smarter, Not Harder

If you want to grow your business, think strategically, writes David Fox

WE HAVE discussed in previous Cutting Edge columns the trade-offs between small and large business models. In many discussions with broking business owners on this subject a common objection raised against growing the business exponentially is that they will have to work much harder in a larger business.

This response is a great example of how difficult it is to exclude current influences when viewing the future.

If a business was to grow by increasing the number of clients it serves and the number of employees servicing them, then of course it is logical to believe that the business owner will have to do a lot more of what he/she does currently to drive that growth. However, the business that grows exponentially typically does so by doing things differently, not doing things the same but more often.

Therefore, again typically, the owner’s role in the larger business will be vastly different than the role he/she has filled while the business was in a smaller model. There is not the necessity for the principal to work harder, just smarter!

At Advice Centre Consulting we have noted five principles followed consistently by businesses that have demonstrated exponential growth without the need for the business owner to work harder.

PRINCIPLE 1: REFINE AND CLARIFY ALL ROLES

A $2 million business is not a $400,000 business on steroids. It is structured differently, has different skills and competencies, serves different clients, has a different working and operating environment and so on. And the people working in this business have clearly defined roles with clearly articulated measurements of success. And that includes the role for the business owner. In the smaller business the owner may have had multiple roles of CEO, HR, operations and marketing manager as well as principal broker and lead loan writer. As the business grows it is impossible for all these accountability areas to be successfully held by the one person.

The business owner will need to choose whether he/she wants to continue in the loan writing role or focus on the CEO and management role. There is a transitionary stage but eventually the business owner will need to narrow his/her role focus.

PRINCIPLE 2: SURROUND YOURSELF WITH TALENT

We have stated in past columns that the best people work for the best businesses. There is no room for ‘B Grade’ players in an ‘A Grade’ team. Business owners need to build the talent in a growing business if they are to work in the larger business without the need for extra effort and higher stress levels.

There needs to be a refined recruitment strategy to access new talent and personal development programs in place to raise the talent levels of current team members.

PRINCIPLE 3: CLEARLY IDENTIFY TARGET CLIENTS

Larger businesses can only achieve efficiencies required if they are serving common groups of clients. Target groups may be broader than one but no more than four. This also allows the business to develop the talent required to service these clearly identified client groups.

PRINCIPLE 4: WORK IN HARMONY WITH OTHER PROFESSIONALS

There is not the need for businesses to have all the skills and competencies residing in the business to deliver to the advice needs of their clients. Creating advice partnerships with other professionals ensures all specialist skills are available to deliver to the advice needs of clients in a cost effective and efficient way.

PRINCIPLE 5: CHARGE WHAT YOU ARE WORTH

Growing businesses have greater confidence to implement premium pricing structures. They are less reliant on the next client to meet their financial targets and therefore are less inclined to fear the client will reject a higher fee. If growing businesses are delivering value to their clients they need to ensure they are being compensated fairly for delivering such value.

Following these five principles will provide the opportunity for business owners to experience exponential business growth without the fear of extra work.

By David Fox, Principal, Advice Centre Consulting