The transition period of growing your business from a small business to a medium-sized operation poses many challenges for South African entrepreneurs who may not be equipped to deal with the change and some of its effects. This is according to the South African cooking school, Capsicum Culinary Studio, who 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.
How To Grow Your Small Business
According to Capsicum Culinary Studio, during the transition phase of Capsicum, the goal was to run a R100 million business. In order to achieve this they hired a CEO with skills that the business did not possess but were necessary to bring the 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 Capsicum.
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,' they explain.
As a business grows, more management will be required to take on the increasing number of responsibilities of the operation. Furthermore, the original employees generally won't have the skills required to work for a medium-sized business.
An example is Steve Jobs who once said that the original team is not the team that takes entrepreneurs to the next level.
There is often a resistance from old staff to adapt to the changes of new management and for this reason they may resign. You need to have a clear succession plan in place before you decide 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.
Furthermore, 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.
Entrepreneurs should not underestimate the value of attending conferences and networking. Attending conferences and networking often bring about ideas that could take a business to the next level, as well as establishing meaningful professional connections.
You can view a shortened version of this talk on the University of Stellenbosch Business School's Youtube Channel.