- Delna Avari
Design your organization to scale profitably: People Perspective
Updated: May 8
The decision to scale is an important turning point in any organisation. The success of this endeavour depends, in large part, on the organisation's people strategy.
Business scaling occurs when your revenue increases exponentially, but your cost of servicing that revenue increases only marginally. The strategy to scale profitably needs to be designed at the core of the organisation, keeping people, processes, operations and technology in mind. We discussed the business model and strategy development perspective in the first part of this series, now we come to the heart of the business, its people.
There are certain aspects to keep in mind when preparing your business to scale from a people planning perspective.
1. Lead, don’t micromanage
The leader needs to structure the organisation so they can move into a position of irrelevance for the execution of the strategy. By its very nature, scaling requires the leader to step back once the strategy is set in motion. Keep your eye on how the strategy is being executed but if you find it necessary to micromanage execution then scaling will suffer.
The leader needs to keep their focus on the big picture and on the milestones. Step in to check if everything is on track, but you shouldn't need to do that too much after the initial ‘lead by example’ phase.
2. Hire right
Effective people planning requires you to hire for broad and complementary skills. Many hiring teams suffer from the ‘lookalike’ syndrome, thus missing out on much-needed complementarity. It isn’t about building diversity for clichéd reasons, it is about truly filling the gaps in management skillset. It is also about hiring with the end state of a scaled organization in mind, else you will find a mismatch between where you want to go and the people you are counting on to get you there.
When you are convinced you are ready to scale, hire the right people for that vision, invest in their growth and development, while giving them the space to do what is agreed upon. The mental preparation to let go of excess control is key to scaling. One way to counter the inability to delegate core jobs would be to set critical control points in your organisation’s process flow. Think of them as checkpoints in your road to successful scaling.
There also needs to be an acknowledgement that profitably scaled businesses do not happen due to individual brilliance but actually due to team brilliance. There is a lot of lip service given to this fact but in reality there is greater media focus on ‘stars’. This is no exaggeration, the right team makes all the difference. You should ensure some skin in the game for key leadership and management positions with a decided percentage of the stock pool kept aside for this purpose.
There are certain aspects which are core to the business, everything else is collaboration and alliance. These are alliances with other entrepreneurial outfits, with service providers, suppliers, channel partners and with your customers.
This network supports scaling and building the right one makes all the difference. There are some partnerships that develop organically; by the very nature of the business. But if you want to truly succeed, you need to plan the details and ensure your network of relationships functions like a well-oiled machine. The details will include who you will collaborate with and for what; this has to be by design.
While you consider these three key aspects under the people planning perspective, ask yourself; are you consciously planning for business scaling? Or are you so caught up in paying the bills that you’ve forgotten your purpose? Living day-to-day often leads to a leaking bucket or feeling like you’re stuck on a treadmill.
If this resonates with you, let's discuss further. Consult with us on business transformation and scaling for your enterprise.