You need to understand the business lifecycle to strategically grow your business

One important concept you need to grow your business is a complete understanding the business lifecycle, says Brad Turville, director and business advisor at BJT Financial. Otherwise, you risk tripping over your own success.

If your business sales have plateaued, your team is unmotivated or the business isn’t where you originally envisioned it to be, keep reading because you are about to find out what strategic decisions you need to make to drive growth.

The business lifecycle is something I learnt many years ago from a mentor. It’s a powerful tool for strategic planning.

The business lifecycle

We are all sitting somewhere in the business lifecycle. Some may be in the startup phase, others in the middle in the high-growth stage, but few will break through this hurdle to the next stage.

Dependent on where you currently sit, your strategy should be focused on continuously moving and breaking through two important milestones that cripple many businesses.

The startup stage

Remember when you first started your business? Or maybe you are just starting now. It’s a very exciting time, converting sales, sending out your first invoices and establishing some cashflow. This stage is fun, but tough and you have to invest a lot of time and energy to really drive it. This is when you hit the first hurdle and you need to invest time and energy to grow your business and push over this milestone.

The growth stage

Moving into the growth stage of the business lifecycle, you’ve put in the hard yards, your business growth trend accelerates and with that comes sales and cashflow. What happens here is you start rewarding yourself. Maybe you buy a house, a new car, take a few holidays and why not? You’ve worked hard so you deserve it, right? This is payback time because you feel like the business now owes you. “It’s my business, I built it, so I’ll take whatever cash I want and enjoy it.”

Suddenly you’re now working seven days a week, there is a blurred line between work and home, you’re missing out on family time. Added to that, the business is not growing as quickly as it was not that long ago. How did this happen? You get frustrated with yourself, at the business… at everything. Stress starts to settle in, you become anxious answering the phone and meeting with clients, and decisions will be made in a panic.

Welcome to the second hurdle

From here, things usually go one of three ways:

You get through the wall and experience rapid growth (trending upwards)
Your growth plateaus (a flatline trend)
The businesses growth declines (downward trend)

To break through this wall and continue to grow your business, you are playing a different game to when you first started. At this stage in the business lifecycle you need to determine what your role is and, just as importantly, what it isn’t.

You also need to assess all other roles in the business. How many hats are you really wearing and should they be delegated either internally or externally? This isn’t about your ego, it’s about the best strategic decision to drive the growth of the business.

Some more questions are:

Is there an effective sales process in place?
Is there a strategic plan in place to drive business growth?
Is there a succession plan in place to pass on the baton?
Where do you sit in the marketplace?

A high emphasis on strategic decision making is now a priority. That’s because unless you planned and implemented strategies for rapid growth, at this stage you may shrink as quickly as you grew.

So where do you think your business is at in the business lifecycle? And where do you think your head is at? Because how you feel and where your business sits can be two different things. So you may have to put in some work to grow personally. Never discount the impact of personal growth on the growth of your business.

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Now read this:

https://www.kochiesbusinessbuilders.com.au/how-to-take-back-control-of-your-cash-flow-and-drive-business-growth/