The demo went smoothly and they came to the last slide. The CEO asked, “Are there any questions?” After a long pause, a skeptical voice in the back said: “Yea, looks great. But can it SCALE?”
When you’re looking for funding, whether from outside investors or from inside your organization, the question is often the same, “How can your big idea actually SCALE?”
In my work with CEOs and boards driving high-stakes strategies, scaling quickly is often the goal.
What exactly IS scaling? And why does it matter so much?
I’m speaking about what it takes to scale at the Nehemiah Best Practice Conference at the end of the month, with entrepreneurs and investors coming together from all over the world.
To prepare, I ran an informal poll this week. The majority of people I asked to define what it means to “SCALE” responded with the word “GROWTH”.
Sure, growth can be a juggling act. Even if you’re past the risky start-up stage, growth can be overwhelming and exhausting.
But GROWTH and SCALING are DIFFERENT.
- GROWTH means that you are increasing your impact: more customers, more revenue, and more market share.
- SCALING takes growth up a notch. Scaling means that can increase your impact (growing customers, revenue, and market share ) – but you can do it WITHOUT increasing your costs and resources at the same pace!
WHY DOES SCALING MATTER?
Scaling is a STRATEGIC approach to drive impact, create profit and sustain a healthy organization over time. By scaling, your organization can deliver more value.
According to McKinsey & Company,”While most companies tend to focus on LAUNCHING new businesses, the real value comes from being able to SCALE them up. Based on an analysis of U.S. venture-capital data, two-thirds of the value is created when a company scales up to penetrate a significant portion of the target market.”
SO HOW DO WE SCALE?
Growth requires a BIG VISION. But scaling requires we GET READY for the implications of that vision — to plan for “WHAT IF?” across four dimensions: Purpose, Product, Process, and People.
This is not a new idea.
· Thousands of years ago, the Israelites and their leader Moses were advised to get ready for growth, even while they were wandering around in the desert. God guided, ‘’Enlarge the place of your tent; Stretch your tent curtains wide. Do not look back.…”. And when Moses was getting burned out, he tapped capable leaders to help him make decisions.
· In the 1770s, George Washington led American revolutionary forces to victory despite horrible conditions. He organized a process to get food and supplies to frontlines to survive the freezing winter. He tapped Alexander Hamilton as his right hand to get day-to-day decisions made faster. And when he became President, Washington planned for his own succession right from the start.
· In the 1920s Thomas Watson believed technology could solve the world’s problems. So he became General Manager at the Computing-Tabulating-Recording Company, the result of a messy merger with lots of silos and little trust. Watson quickly streamlined operations with standardized components and manufacturing processes and established clear lines of communication across departments and with customers. Watson invested in training for every employee and manager, focusing not only on products and processes but on doing business based on shared ethical values which later became “The IBM Way.”
Say we invited Moses and George and Tom to be on our Advisory Board. Don’t you think they’d be urging us to start NOW to get ready to scale? I can just hear them:
- PURPOSE: “Get clear about your WHY and don’t get so darn attached to HOW! The world changes quickly, and you’re going to need to adapt the way you get things done.”
- PRODUCT: “Focus on real problems people want solved. Don’t fall in love with your perfect solution (your WHAT). Start with listening. You’ve got two ears and one mouth for a reason.”
- PROCESS: “Be flexible!” Bite the bullet and convert your systems and processes and leverage the technology so you can add transactions more easily. Keep it simple. (And what is this new thing, ChatGPT AI?)”
- PEOPLE: “Build strong leaders you can trust. Start delegating. Build a diverse ecosystem of trusted partners as fast as you can. Remember — you can’t scale by yourself!”
It would be hard to ignore the sage advice of this brain trust!
I believe the PEOPLE aspect of scaling is the most complex.
Scaling sounds GREAT when you’re talking about software. One line of code can support one customer — or millions! But how can PEOPLE scale?
At the conference, I’m going to be talking about three considerations for scaling when it comes to people – and cloning isn’t one of them!
What have YOU found works to help PEOPLE scale? I’d welcome your thoughts!
This article is part of my newsletter, Driving a New Direction to equip and energize leaders with practical ways to move people forward, whether you’re leading a new strategy (or getting one back on track!). To get notifications of new articles (and updates about my next book!) Subscribe below. To learn more about workshops and other support to fast-track your strategy, explore this website, www.gotomarketimpact.com or message me at susan.schramm@gotomarketimpact.com
