Business Growth — Stage 6 — Lack of Strategy Will Kill A Business
Strategic is Stage 6 in The Stages of Growth methodology and follows on from the Integration stage. Companies are in this stage as they grow from 96–160 employees.
At Stage 6, the risk of not seeing the bigger strategic picture could lead to the ‘too little, too late’ syndrome. In the earlier stages from 1–4, the leader acted almost exclusively with an immediate focus, dealing predominantly with current issues and opportunities. In Stage 5, the leader started to focus on and tackle serious budgets and long-term planning. Now in Stage 6, the leader needs to focus on longer-term planning, beyond a year, in order to compete in the marketplace.
Growing from 96–160 employees, the company is big enough to start appearing on the radar of much larger competitors. So the usual 6–12 month strategic and product development plans, that were effective up to this point, need to extend further into the future.
The key objectives in Stage 6 are to:
- Establish a 3-year budget and a financial system that can handle the needs of a larger company.
- Ensure Business Development has an integrated system and comprehensive strategy to sustain company growth.
- Complete Infrastructure Building Blocks.
- Focus first on People, then Profit, and finally Process.
Engaged Employees Build Successful Companies
This is true for all Stages, but it becomes really important in Stage 6, where the company begins to struggle with staff related issues like staff buy-in, hiring quality staff, difficulty establishing new hire orientation processes and aligning staff satisfaction with company profit. These challenges combined with a weak business model put significant pressure on the business.
To mitigate these challenges, the leader needs to focus on initiatives that will benefit employees and the organization. The easiest way to ensure employees are on board is to establish a comprehensive orientation program and to ensure new hires are immersed into the culture of the organization. Then determining staff satisfaction through surveys and managing staff performance through annual one-on-one performance reviews, where staff get to understand what is required of them and are given an opportunity to provide feedback and raise any concerns, are also key to increasing staff buy-in and engagement.
By strategizing and building a bigger picture for the company over the next 2–3, possibly even 5 years depending on the industry, the business leader can start bringing back the visionary atmosphere that was so engrained in the earlier stages. Being visionary does not simply mean dreaming about the future, but rather, the leader together with his management team must develop and communicate a strategy for each department.
Some of the Non-Negotiable Rules of Stage 6 are:
- Establish an advanced orientation program that immerses new hires into the culture and processes of the business.
- Establish a fully integrated 2-year budget and forecast for each department by Revenue Groups.
- Task Operations teams to lower costs through the identification, acquisition, and implementation of advanced systems and processes.
- Leaders and managers must demonstrate Core Values daily.
The business leader must have the personal ability to develop a strategic orientation, be able to set in motion a longer-term view and drive the organizational culture as a visible leader.
At Stage 6, the significant increase in headcount changes the workplace community — a dynamic ecosystem — almost overnight due to the additional complexity. As a result, the distribution of authority and accountability raises major challenges in this stage. So, in order to manage these challenges within the workplace, the business leader must:
- Establish a very clear vision for the business.
- Establish a strong set of core values.
- Establish a clearly defined corporate culture.
- Establish a powerful strategic plan that spans the next 2–3, if not even 5 years.
The business leader must effectively communicate and propagate these four key items to the employees and ensure they are infused into the leadership and management teams.
In Stage 6, the primary leadership style is Pace-setting blended with Affiliative and Visionary as secondary and tertiary styles. The business requires the leader to set the bar for success, foster connectedness within the team, and instil pride in the organization.
In Stage 5, the Affiliative leadership style was introduced, which focused on connecting people with each other. This style helps facilitate the healing of rifts between teams and provides motivation during times of stress. To be effective, the leader needs rely on this connection among the team to facilitate and manage change. It is important to place emphasis on the team, because the leader now spends 50% of their time in the Manager role and without a strong competency in empathy, this can be a tough time for a leader.
To keep the company growing and successful, the leader and his team must clearly communicate the company strategy to the organization and ensure everyone is aligned to it. Remember — a company that lacks strategic vision will become stagnant.
Mastering the Strategic stage then leads into the Visionary stage, where the challenge is addressing the enormous shift in complexity in the organization as the number of employees can double from just the prior Stage.
Here are links to the articles published on the other Stages: