6 Tips On How To Scale Up

Paul Toth
Paul Toth
Nov 5 · 7 min read

This is an article from the Big Hairy Hugs series on business management.

In many instances, our company is brought in to help small and midsize organizations scale up their operations. Below is a list of 6 challenges we often see companies struggle with in their attempts to scale up, and potential solutions to these challenges.

1 - Threshholds

Problem: Difficulty overcoming the cost thresholds of expansion.

Solution: Scale laterally. Copy your current workflow instead of changing it.

It seems like there is always too much work for the existing team to handle, yet not quite enough work to justify hiring that missing team member. This pattern plays out with common decisions such as hiring an additional front line worker, or taking a more significant leap to hire a full-time salesperson or hiring a project manager. The reality is that you cannot scale up your business without investing in it. Investing always has some degree of associated risk. Therefore, the bigger the threshold, the bigger the risk, therefore one strategy is to structure your growth in a way that keeps the thresholds to a minimum. Instead of growing by restructuring your workflow patterns - and taking on the associated overhead of hierarchy and layers of management - consider growing by duplicating your workflow patterns into copies or "cells", and therefore scale laterally. It may seem less efficient to follow this strategy; however, in some cases your current workflow pattern is intimately tied to why you are taking business away from your more significant competitors in the first place. In other words, scale what you do, but don’t change how you do it. Rarely do companies respond to growth pressures this way, yet it has been proven to work well in manufacturing via the "lean" paradigm. In our experience, lean manufacturing principles apply equally well in service-based industries. If it ain’t broke, make copies of it. Your competition won’t see you coming. Some of the benefits of scaling laterally include: Smaller teams know each other and work well together. Risk is reduced. The complexity and bureaucracy from hierarchy is avoided. The ability to scale up and down becomes relatively seamless. Smaller teams remain agile and innovative.

2 - Experimentation

Problem: Small scale operations often makes experimentation difficult due to risk and lack of resources.

Solution: Scale experiments down in size and leverage close connections with staff and customers.

A bigger company may have the luxury of segmenting a team off from the rest to experiment with services and organizational changes. However if your company only has one team, this may not be possible. With only one team, experiments can have disastrous consequences. Even though there may be no easy solution here, we cannot let go of the importance of experimentation. Try scaling down experiments into smaller increments. Try your ideas with one or two staff members as well as with one or two customers, staying close to both with frequent, in-depth communications to understand what is working and what is not. Your small size can be an advantage here over larger competitors who have layers of bureaucracy and disconnect from the front lines. This turns what may initially seem like a disadvantage into an advantage that can be leveraged.

3 - Momentum

Problem: Business momentum moves you forward but also holds you back.

Solution: Know and communicate your growth vision through each scale change.

Momentum is often the signal you waited for to decide it is time to grow; however, momentum also resists the necessary changes. This is because "success" has different meanings on different scales. The definition of what success looks like when you have 20 staff can look very different from what it will look like when you have 50, or 200. It complicates discussions and confuses staff when what is an advantageous workflow now, may be a disadvantage later, and what will be an advantage later may be a disadvantage now. Lay out your growth plan and share this continually with all of your staff. Be careful in discussions to clarify if you are talking about your short, medium, or long term vision to help avoid confusion. And again, scaling laterally and having the ability to do small intimate experiments is a pattern that can work on all scales. Sometimes the best plan to beat your bigger competitors is to not become more like the bigger competitors; it is to be different from them.

4 - Formalization

Problem: Scale creates the apparent need for increasingly formalized procedures, which can stagnate growth.

Solution: Think not in absolute terms. Instead, think in relative percentages.

The burning need to formalize procedures as companies grow creeps in and can quickly stagnate innovation and destroy the very reasons why the company achieved a degree of success in the first place - the "why" of your initial success. Because dollars amounts become much larger as you scale up, a small percentage of error now translates to a much larger dollar amount of loss. The key here is to remember that it is still a percentage. If the percentage remains small while the margins remain high, is there truly a need to change your processes and tighten procedures? Sometimes the leaner, smoother workflow of a small scale business allows space and time for empowerment, innovation, and a higher level of customer service to occur. With this perspective, the percentage of loss may instead be viewed as a percentage allocation of continual investment back into the company. It is something the bigger lumbering giants have long since forgotten, and it is what keeps your team agile, empowered, and responsive to change.

5 - Shifting JTBD (Jobs To Be Done)

Problem: Your business is what it is because the people within it are who they are. All people resist change from the path they are on, which is yet another form of momentum.

Solution: Address each and everyone's JTBD and frame the future in their context.

The basic principle behind JTBD is that everyone in a company is working toward a future vision of themselves. Since a company is nothing more and nothing less than the people within it, the company’s JTBD is always defined by the collection of the JTBDs of all the people within it. If a company is to grow, its JTBD must shift, and if this shift results in misalignment with too many individual JTBDs, the shift cannot occur, not without realigning staff. It is critical to have a clear vision of your company’s next stage. Paint the picture. How will things be different from what they are now? Combine this with the understanding of each person’s JTBD to help fit their personal path into the company’s vision for the future. If the company’s plan moves them forward in their JTBD, they will actively move the company forward with them.

6 - Knowing why

Problem: If your success in the market is because of what you do, and your growth plan includes changing what you do, will you still have success?

Solution: Know the deep deep fundamental "why" of your business, and make it resilient to change.

Unless your company fully and completely understands the "why" within "Why do customers buy from you and not from another supplier?", then scaling will be very unlikely to succeed. Truly knowing your “why” is more difficult than it seems. This question, asked over and over, forces you to sometimes realize that the reasons why customers buy from you are a combination of factors that will facilitate scaling up, while some of these factors will actually prevent scaling up. Often this is the "craftsman’s dilemma" where what you find to be your competitive advantage is *you*, and you cannot find a way to replace yourself. This is when some serious soul searching kicks in. However, the process of asking why is like peeling away at the layers of an onion (with the accompanying tears), and sometimes the deepest of layers reveals it isn’t *you* that the customer wants, nor key staff who may also be craftsman. It is what you do that is of value, hidden beneath what appears to be magical, irreplaceable abilities. And that is something that may be scalable. It can be deflating to think that with all of your years of experience, and the sweat, blood, and tears you’ve put into your company, that not only can you be replaced, you actually need to be replaced in order for the company to grow. This is a personal JTBD shift that compares to few others. However, it may simply be a matter of perspective and seeing a new future role for yourself and the others caught in this dilemma. Your abilities and wisdom got the company to where it is, and the company will continue to need you to grow up and graduate into independence, like a child moving on to become an independent adult. For this to work, parents need to let go, and the child needs to remember what was taught. It takes time and courage. The same applies to letting your business grow.

Does Ucora have all the answers? Far from it. In terms of scaling, our company faces many of the same challenges our customers face. Our strength is with our experience in employee empowerment, understanding barriers to growth, helping companies organize, streamline workflow, and free up time to innovate, recharge, and grow. As our customers scale their operations up, and we believe that if we can understand and address these challenges, and incorporate solutions into our services and the custom software solutions we provide, we will serve everyone better.

I hope this article will spark discussions among your team members, and with our team as we all move forward.

Paul Toth

Written by

Paul Toth

Founding member of Ucora Corporation. Management consulting, information systems design. Web: www.ucora.com LinkedIn: www.linkedin.com/in/paul-toth

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