MANAGEMENT: Growing Your SME
Recent Western Cape Business News
THE transition of growing a business from a small business to a medium-sized operation poses many challenges for entrepreneurs who may not be equipped to deal with the change and some of its effects.
So said Cheryl Nesbitt, founder and owner of South African cooking school, Capsicum Culinary Studio, who recently addressed entrepreneurs at the University of Stellenbosch Business School’s (USB) Leader’s Angle and discussed how to survive the stressful transition period of expanding a business.
According to Nesbitt during the transition phase of Capsicum, her goal was to run a multi million business. In order to achieve this she hired a CEO with skills she did not possess but were necessary to bring her business to success.
“Once a CEO and/or new management are hired it is likely that the culture of accountability will change. During this process it is important that the original culture created stays the same,” warns Nesbitt.
Nesbitt says the key to growing a business and expanding the footprint is to document all business systems, processes and routines utilised during a typical day of operation. “This is the reason why franchises such as McDonalds stay successful. They ensure that everything is documented exactly the same way,” she explains.
As a business grows, more management will be required to take on the increasing number of responsibilities of the operation. Furthermore, Nesbitt says the original employees generally won’t have the skills required to work for a medium-sized business.
She refers to Steve Jobs who once said that the original team is not the team that takes entrepreneurs to the next level. “There is often resistance from older staff to adapt to the changes of new management and for this reason they may resign. One needs to have a clear succession plan in place before deciding to grow so that these frictions do not lead to unnecessary interruptions. Another alternative is to upskill staff members so that they are equipped to deal with the new responsibility when it becomes necessary.”
In order for a growth strategy to be successful, business owners must be able to adapt their strategies and compile regular competitive analyses to assess their position in the market. Moreover entrepreneurs should not underestimate the value of attending conferences and networking. Attending conferences and networking often bring about idea’s that could take a business to the next level, she says.
Business News Sector Tags:
Fax 2 Email
Study IT Online
Work from Home