CEO of Acumatica.
Small business owners want to see their companies grow: getting more customers, edging out competitors and establishing brand longevity. Such growth, which shows that the company is meeting market needs, is a satisfying confirmation for business owners. It means the risks they’ve taken have paid off.
The digital marketplace is challenging in 2022. But the good news is that many small business owners feel confident about their future. A recent survey by Capital One found that—despite inflation, rising interest rates and the tight labor market—small business owners remain optimistic and are motivated to grow their organizations.
But with increased growth comes complexity and greater responsibility. When a small business or startup shifts toward being a mid-size company, it must establish a growth plan and make sure it has the right software and tools to scale effectively. Many growing businesses discover they have outgrown their digital tools. As they increase in revenue, hire more employees and open new office locations, their operations obviously become more complex, and technology management is among the biggest obstacles to growth.
To skirt these growing pains and avoid the fits and starts of haphazard growth, one of the first initiatives in an SMB growth plan should be adopting a robust, customizable business management system. Such software places the entire organization under the umbrella of one unified system, serving as a central data repository for every department. This connects all workflows—from sales and accounting to CRM and IT—and creates a solid foundation for smooth, strategic advancement.
To remain competitive, business leaders must know the signs that herald the need for a more robust business management system. A few of those signs are outlined below, with an eye toward how SMBs can harness them to thrive at the helm of their growth journeys.
New Lines Of Business
Branching into new product and/or operations areas is arguably the clearest sign that a company needs to take a good, long look at its business management system. The expansion will be hindered or halted if the governing software can’t handle the burden. An SMB opening new lines of business needs a system that can keep track of every area. For example, a manufacturing company can be broken down into supply chain logistics, inventory tracking, warehouse management, etc. It needs a comprehensive system that can cover and connect every department and line of business.
Leaders must take the reins of expansion, and the right business management system will help them accomplish this with company-wide visibility, communication and data analysis. Organizations should use the opportunity presented by expansion and, before taking the plunge, determine whether their current business management systems are up to the task. If the software can’t grow with them, then an upgrade is necessary. And, on the flip side of that coin, an upgraded business management system can help SMB leaders make informed, data-driven decisions about whether a new line of business is worth the investment.
As an organization scales out, it increases its workforce, builds more departments to support new customer needs and potentially opens more locations in key markets. These signs of growth, while exciting, often lead to work silos. Employees don’t collaborate outside their departments and have no knowledge of the projects being accomplished by other departments. Teams use separate spreadsheets or even different software to manage data, and that data is rarely shared outside their groups. If work silos like this aren’t addressed, they can become embedded in a company’s culture, with teams seeing no value in collaborating outside their own departments.
But no company can thrive with siloed workflows. Transparency is the answer. A cohesive business management system that integrates multiple departments and applications, providing a holistic view of all workflows, pulls leaders and employees up from their individual tasks to see the horizon.
A business is divided into many parts. Department A is responsible for this; department B is responsible for that. But, together, they make up the landscape. The power of that can only be harnessed by integrating all the parts. SMBs should address siloed workflows immediately, using them as a vantage point for testing new business management systems. The system that will most efficiently replace silos with company-wide cross-collaboration is the right answer for that SMB.
Customers’ Evolving Expectations Aren’t Being Met
As an SMB grows, the stakes become higher. The larger a company becomes, the more customers it reaches. The more customers it reaches, the more varied expectations it will see. Leaders may notice customer expectations aren’t being met in several ways, some more obvious than others: a rise in complaints, a drop in sales or customer engagement, a shift in sale types and buyer demographics, etc.
At the outset of these changes (preferably, before they even begin), SMBs must implement a business management system that will provide real-time insights into how each department and/or product area functions. This will help them remain ahead of customer expectations, identifying minor issues before they become significant problems. And, when a business owner can quickly see all aspects of a company—from revenue and profit margins to product quality and customer satisfaction—decisions can be made faster, efficiency increases and customer experience is prioritized.
Taking the step forward from being a small business to becoming a mid-size company is a milestone to be celebrated. With a comprehensive growth strategy, knowledge of how to read the signs of change, and the right business management system to provide clarity and connection, a mid-size company can thrive and scale successfully and strategically.
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