“Slow down to speed up.” You’ve heard this before, right? And, “You don’t know what you don’t know.” These familiar phrases are often used in life, and are applicable for business as well. Two places these phrases surface in business are during rapid growth and in a sudden crisis.
Most companies grow organically. In the early stages and often at points of rapid business growth, team members are commonly called on to manage a wide range of responsibilities, including ones outside their areas of expertise. Operating at a very rapid pace, often with limited resources, and juggling multiple priorities at these points can result in leaders overlooking or deferring the addition of expertise and infrastructure. That in turn can prevent a business from sustaining long-term success and/or being prepared to weather an unexpected crisis like the COVID-19 pandemic.
Below, let’s look at an anonymized-but-actual example of how one company found wisdom and a way forward as they experienced the impacts of uncontrolled growth and the business perils of the pandemic simultaneously.
Mining for Minerals and Finding Fractures
Innovative Mining Systems (IMS) experienced rapid growth as a mining and excavation services organization that supports the hydraulic fracturing initiatives of notable organizations in the energy industry. For many years, the company profited from and rode the fast and steadily rising wave of the collective industry, doing what it could to keep up with demands for its services.
As new contracts were awarded, more employees were onboarded, and the scale of operations expanded. Fractures in the infrastructure of their business began to emerge as the company was always in a catch-up mode on infrastructure. Left unaddressed, these fractures turned into full-fledged points of crisis when the COVID-19 pandemic wreaked havoc on the industry as a whole and forced IMS to stop operations at several sites, leaving only an OSHA-required skeleton crew at those locations.
You Don’t Know What You Don’t Know
To try to save the business and regain lost traction, new leadership joined the team. They needed to act quickly but recognized that required first taking a step back (i.e., slow down to speed up) for a thorough evaluation of the business before they could confidently craft the way forward. They also recognized expertise gaps in the organization (i.e., you don’t know what you don’t know) and partnered with vcfo to augment their work by assessing and providing recommendations for the accounting, finance, and HR functions and assisting them with the strategic rework of the operating plan. Together, they were able to:
- Prepare, evaluate, and select from scenario analyses to guide overall planning and execution
- Identify the key areas of stress in the organization and what needed to be done to reset and optimize operations in those areas
- Reengineer and reorder working groups and departments for higher efficiency and work skill alignments
- Improve cross-training processes to set employees up for success and reduce costly errors
- Implement accounting and financial best practices that increased accuracy and supported better decision making
- Review alternative actions and establish contingency plans that would get them through the current downturn
One element that also worked in favor of IMS was that other competitive operations were experiencing similar growth- and pandemic-borne business losses and operational pains. The general reaction of these competitors was to cut expenses and lower margins, but these steps also lowered their ability to meet customer needs. By maintaining high customer service standards and repairing the fractures that were present well before the pandemic, IMS has been able to attract business from these competitors to compensate for its losses and set a stage for higher future growth.
Slow Down to Speed Up
When organizations grow the scale and complexity of their business at a faster pace than they grow their infrastructure and capabilities, they introduce risk. Keeping this in balance requires the discipline of continually and objectively asking important questions and addressing answers that require action:
- Do we have the right mix of skills and experience in place for where we are and where we want to go?
- Are our financial and accounting practices producing accurate information and valuable operational data that will guide us forward?
- What systems or processes are not functioning as well as they could or should be?
- Are we developing and equipping our employees to be able to grow as our business does?
- If our industry experiences a sudden downturn, how will we respond?
Regularly engaging in these explorations takes time. It is much easier and more advantageous to do so before a crisis hits than after. Smart and diligent preparation for potential problems can help businesses avoid many crises altogether or, at the very least, put them in a stronger position to survive them.
Prepare and Provide, Don’t React and Rescue
It’s all too easy for leaders to get caught up in firefighting exercises, especially during the early stages of growth and in periods of rapid change or crisis. To thrive, in-the-moment attention must be balanced by a focus on in-the-future needs and foundational pillars. Speed is vital in business but forging ahead as fast as possible with actions that are not well informed and processes that introduce risk can keep a business from getting to the finish line first – or, worse yet, take it out of the race. Slow down to speed up and don’t hesitate to ask for help when you don’t know what you don’t know.
Are you struggling with these or similar issues? If you wonder sometimes what you don’t know or need assistance preparing your business for new levels of growth, request a free consultation today from a vcfo expert. We have worked with more than 5,000 business teams in our 25 years. We would love to talk with you, hear your story and concerns, and share our experience and collective wisdom to see how we can help.