SMEs face many challenges and achieving ongoing growth can be one of the most difficult propositions. Many SMEs experience good initial growth and then, for a variety of reasons, performance can plateau or decline.
We see it plenty of times and all too often, advice from outside parties can go unheeded as operational pressures dictate where the owners spend their time. What often happens at this point is that a lot of hard work and energy can be focused in the wrong places, leading to frustrations and disappointment with a negative impact on business value. So what can business owners do to get their business back on track?
This is a time for owners to step back, take stock and put on their director’s hats. They need to set aside time, preferably with advisors, to address the following questions:
· Where do you want the company to go? Work on the strategy.
· How do you get there? The capability.
· How badly do you want it? The commitment to achieve.
The first question is targeted around the strategic focus and where you want to take your business. In this instance, business growth is an outcome of employing that strategy. The second part is how you will achieve that. Using the Deloitte Growth Plus Value Map to prompt discussion on these two questions is an ideal place to start.
This is dependent on the type of business but essentially working through the Growth Plus Value Map will assist with identifying the key drivers of the business and then deciding on the actions to achieve growth.
1. Top line growth: Is growth tied to volumes or is a pricing decision? Maybe it’s both?
2. Bottom line Growth: What efficiencies can the business achieve through improved management of their inputs?
3. Assets: Can the business achieve growth through increased/decreased or improved deployment of their assets.
4. Skills: What does the team look like at each level? Are there missing skills, performance issues or other team related gaps?
Delving into these four areas should prompt the necessary discussion and identify the key steps for completing a plan for growth.
Once the plan is formulated, it's important to get the commitment required to carry out or follow through on the key steps identified. Communicating the plan to the key players in the business, getting their buy-in and completing actions is important for the plan to have any chance of being achieved. Depending on the size and complexity of the team, having their involvement in the plan formulation stage can go a long way to achieving commitment and delivery.
Lastly, it will require hard work and keeping an eye on results, revisiting the plan and understanding when and how to change it. Being fluid and reacting at the right time will assist with the overall growth proposition and overall delivery of value.