The Boogieman of Small Business - Part I
Every company needs infrastructure of some sort. Infrastructure for a business entails processes of how the business operates, or in other words how it does its business. This generally involves things like policies on how employees are treated, credit limits for customers, how accounts payables are processed, how orders are filled, and many, many other issues involved in running a business. In most small business, the infrastructure is developed unintentionally. In other words, the business owner "makes it up as he/she goes along."
This process has consequences. The following story is a composite of many stories I have heard from small business owners. The point in combining the stories is that most small business owners experience the same issues as their businesses grow. See if this sounds like anyone you know!
Starting the new business was stressful, but fun. There was not enough money or time, but things seemed to get done. Most of the time was spent taking care of the customers. There was a lot of satisfaction knowing that we could not only find customers but we could also do a better job servicing and providing products than our competition. Looking back, words such as "excitement," "fun," and "killing the competitors," were words we used to use with the few employees that we had.
Our company grew
Sales increased more than we ever imagined. Our sales tripled, then doubled, and then doubled again. We actually had cash in the bank! Our customers were pleased with us. We would stay at the office late at night and dream of how we would continue to kill the competition. The ideas were creative and exciting. We saw a clear vision of the future and felt that we had unlimited energy to continue to grow the company. As the owner, I dreamed about finally buying that car that I had wanted for such a long time. That long vacation with the family seemed within reach.
This business is in a phase that is called Infrastructure Creation and Infrastructure Peak. At this point everything seems to be coming together as the owner imagined what owning a business would be like. But this phase of business growth does not last! In Business Caffeine next week, we will see what happens when the business outgrows the infrastructure. There is disillusion and chaos right around the corner. But there is a way to handle this.