Authored by Yariv Ben Yosef, COO at Air Doctor
Perhaps the first example of scaling up in history was Noah’s Ark. Noah was warned to get the Ark ready before the flood, and not wait until the deluge began.
It’s the same with scaling up – you need to be prepared before a potential avalanche of orders swamps your company and potentially derails your brand. But how can you plan for something as unknown as future demand levels for a product yet to enter the mass market? Unlike Noah, you won’t get any Divine advice, but the following five points about scaling up might still save your company from being washed away.
Analyze changing customer characteristics
Once you start to grow, how will your customers change? Project various scenarios for growth and determine how they will result in different customer profiles. Variables include location, support requirements, and length of sales/support cycle (which will affect how much time you’ll have to develop and nurture customer relationships). The answer to this question will also tell you whether or not your current suppliers are positioned and/or qualified to work with this rapid growth.
Build a scaling team
Organize a dedicated team to manage planning, training, performance improvement, customer success, and overall management, for before, during, and after the scaling process. Be prepared that this will require a change of the organizational structure and processes that served you well up till now but won’t be sufficient to handle the scale.
Although it might seem that these changes will slow down the pace in decision making and execution, they will be valuable in the long run.
Identify and relentlessly improve your SCF
Figure out the single critical factor (SCF) in your business that impacts scale. For example, in manufacturing, it would be lead time; for services, it is probably MTB; and in customer support, it is handling time.
Map all of the variables and owners which affect the SCF. Returning to our examples: for manufacturers, take a look at who and what impacts lead time (e.g. part quality, availability of tools, approval waiting period); for customer support, examine the factors regarding handling time (e.g. information searches, system stability, response times, professionalism).
Identify all parties in your organizational value chain that are or may potentially be affected by growth, then make sure they understand what needs to change and are prepared to do so. For example, the finance department will face an increased workload across the board which will require additional overhead, expanded coverage, and new processes.
Once this is done, you should discuss the results with relevant stakeholders and implement a program to improve the SCF. Moreover, monitoring the status of the SCF should occur on a regular basis and include the possibility of occasional revisions as the company’s situation changes.
Design a frictionless operation
Back in the 1980s (of course you remember!), when Japanese business culture was really popular, we learned all about Kaizen, or striving for continuous improvement. The 80s may be long gone, but Kaizen is still a valuable principle to use when continuously simplifying, upgrading, and eliminating waste in your operational processes. Customers value frictionless and streamlined operations. Every non-essential click or tap on the phone for example drives customers away.
Invest in software
Yes, the pyramids were built without software, but hey, we don’t have slaves or want to wait 40 years before trying out for the big leagues. Business intelligence, CRM, and customer success management systems are all vital to observing and managing the scaling up process.
A note on MVPs
Startup companies with a proven MVP and market need, will sooner or later, to face the challenge of scale, but a Minimum Viable Product doesn't translate to a Minimum Viable Operation. You may have QA’d your MVP to death but backing it up with operations that are similarly robust is absolutely vital.
In order to succeed in this regard, and as described above, each company needs to carefully examine its current operational state and change the processes that could be bottlenecks during a fast growth phase. But more than this, a quickly growing organization needs to recognize that what brought them successfully to this point won’t help them in the next. Sticking to old ways might do more harm than good in a company that is under pressure to scale up rapidly.