5 minute read
The Six Stages of Business Growth
By Brad Harker
Behind every business success story is an equally inspiring tale of adversity, adaptation, and grit. While we don’t often see the many mistakes, failures, and near collapses, it is these adversities that fuel growth.
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At Harker Growth Partners, we experience these moments with our clients every day. Entrepreneurship is riddled with pitfalls and detours that can stifle growth. Recognizing the patterns and challenges inherent to the rollercoaster of innovation, our focus is to illuminate the checkpoints and milestones that can ensure business success. Compiling years of tales and case-studies into a single framework, these are the six stages of business growth.
Stage 1: Strategy
Objective: Establish an intention and purpose for the development of the business.
Every business begins with a spark of innovation or an “entrepreneurial seizure” as Michael Gerber puts it. Occasionally, however, this spark creates a blinding optimism towards key aspects of business creation and alignment. If we are not careful, we can lose objectivity and control of the purpose for which we started the business. Entrepreneurial success requires a defining strategy or intention for both short-term and long-term success. This strategy must also include longer-range checkpoints or milestones to ensure we maintain alignment as growth ensues.
Stage 2: Validation
Objective: Validate product market fit and establish a scalable model of growth.
“Validation” has become a buzz-word in entrepreneurship for good reason. Entrepreneurship has traditionally been viewed as a high-risk endeavor with low odds of success. Today, that trend is changing. Entrepreneurs are learning how to test ideas, share them with customers, and leverage customer feedback to refine the solution into a final product in which they can have a high level of confidence. Entrepreneurship today might be better described as demandbased innovation. Your customers are anxious to solve their challenges and will gladly tell you exactly what they need. The key is taking the time to ask them.
Objective: Leverage sales validation to establish a scalable framework.
Validation instigates demand and a series of new challenges. The first challenge is the “founders plunge.” Stepping back as a founder to enable your team to step up can be overwhelming! It can be equally challenging to simplify the business to a set of processes that can be managed by employees and still make sense to customers. Although hard, this “founders plunge” is an early milestone that will unleash your capacity for growth.
As you embrace the plunge and shed the constraints of the “lone wolf,” a sales process unfolds. This “customer’s journey” leads each prospect from lead generation to pre-sale, sale, onboarding, and ultimately, fulfillment. Successful companies map this process, refine it, and identify every interaction that occurs at each stage. What is the messaging or scripts that optimize each stage? What metrics should we measure to track success? Where can we automate and streamline the process to accelerate growth?
Sufficiently mapping the sales process is paramount for growth. It’s nearly impossible to achieve scale without a framework from which to build and test. As you introduce structure to your sales process, look for consistency in customer acquisition costs, conversion rates, sales cycles, and use-cases. As these indicators align, growth will ensue.
Stage 4: Systems
Objective: Implement systems to ensure sustainable growth at scale.
As a repeatable sales process emerges, you may encounter bottlenecks and process breaks, or you may struggle to find data to support strategic directions. Remember that systems are the backbone of growth.
One of the most obvious systems is a CRM (customer relationship management). At some point, we all need to graduate from MS Excel to manage customers. As you implement systems to track leads, customers, conversions, or finances, you’ll also free up capacity to increase customer engagement.
Systems can also include onboarding and training processes for new employees. If there is a task in your business that feels repetitive or overwhelming, there is likely a system that can be implemented to ensure more productive uses of your time. Systems might seem overwhelming at first. Be patient and enlist help. The investment will pay massive dividends in the long run.
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Stage 5: Efficiency
Objective: Establish sustainable growth and mitigate vulnerabilities of scale.
Efficiency can be the most deceiving and illusive segment of the growth process. Shortterm traction can often be detrimental to longterm growth.
Systems and data integrity provide the vantage point to recognize bottlenecks and inefficiencies early. This is a great stage of the business to seek guidance from outside experts. Instead of hiring seasoned (and expensive) executives, leverage outside guidance to implement proven models and empower a nimbler and more affordable “tiger-team” to execute on those directives.
Culture and leadership also become significant during the efficiency stage. As layers of leadership emerge, strong communication becomes critical. Does every employee, leader, and executive understand and embody the same mission, vision, and strategy?
Stage 6: Growth
Objective: Establish scale through channel expansion and innovation.
Achieving predictable growth is anything but predictable. The market is volatile and constantly shifting. Each preceding stage plays an important role in overall growth. From strategy to efficiency, you must be prepared to adapt to market shifts and constantly seek opportunities to optimize each channel and department.
Depending on your product or industry, growth can come in many forms. Perhaps a reseller network could help you increase your market reach or expand revenue sources with adjacent products or strategic acquisitions. Regardless of your strategy, remembering these four tenets will ensure long-term success:
1. Validation never stops. Always seek guidance from your customers. 2. Sell value, not features. Focus on the customer’s journey to success. 3. Measure and test everything. 4. Adapt, even if it’s painful.
Brad Harker is a relentless problem solver who is driven by the pursuit of purpose and potential. He has led an unconventional career spanning entrepreneurship, real estate development, and more than a quarter-billion dollars in sales. Now, as an author, speaker, and founder of Harker Growth Partners, Brad helps organizations and professionals generate powerful growth. Through his book The Laws of Influence, podcasts, and training courses, Brad and his team are committed to accelerating performance at the highest levels. You can connect with Brad at www.bradharker.com.
