Is There a Limit to Scaling Your Business?

Written by Emma Hopkinson-Spark & Mike Dixon

The short answer is no. However, the fact that this article isn’t one sentence long means there is more to the story. The reason this question is harder to answer than it should be lies in the confusion surrounding growth and scale. Scaling is often viewed as an end result when it’s actually a process that enables sustainable growth.

The importance (and prevalence) of scaling, however, is easier to pin down. By 2023, annual spending on digital transformation is expected to reach almost $7 trillion, as companies are gearing to grow into “digital-at-scale future enterprises.” 1 It’s the prime time for businesses to really think about their scaling strategies so that they can stay one step ahead.

The world has experienced immense changes in recent years. For many, scaling represents a viable way to meet demand and succeed in these new conditions. Let’s go through what you need to look out for to enable smooth scaling. 

Suggested reading: Our whitepaper Scaling and Accelerating Product Development goes into greater detail on everything you need to know about effective scaling and product development.

The relationship between scaling and growth

Although linked, growth and scaling differ in key ways. Growth is about “more” — more customers, more staff, more products. You get the picture.

Scaling is the implementation of a framework that allows a business to enjoy long-term growth without collapsing in on itself. It’s the changes in your people, structures, and operations that enable the “more” of everything.

So your scaling should be dependent on a combination of your existing business objectives and your anticipated growth. If scaling isn’t conducted in line with these factors you will hit roadblocks. 

We opened by hinting that, for the most part, there is no limit to scaling your business. You might argue that certain things like the size of the market your company operates in can actually be limiting, and we understand that. But the majority of “limits” that will come in the way of your efforts to scale are more likely to stem from your internal structures. Taking a step back and reconsidering how your organisation is set up and how it functions on a granular level is what takes your approach to growth and ability to scale to the next level. 

New call-to-action

Challenges that limit scaling success

Every organisation must find a way to overcome the following challenges to see a successful business scaling strategy.

Lacking clear objectives and/or a plan for measuring progress

Clearly defined goals and performance indicators are essential. Fail to set and share these and you can expect drift. Maintaining open communication and collaboration is what’s ultimately key to solving this.

Strategies to help 

  • Prioritise visibility: Every employee should know organisational goals and what progress has been made. The latter could, for example, appear on a company-wide dashboard.
  • Contextualise objectives: Relating team goals to wider business objectives increases motivation while simultaneously fostering a sense of inclusion.

Evaluate success from a user perspective: This keeps you focused on the right things while helping you quantify the impact on the bottom line.

Expanding teams disproportionately 

Balanced teams are effective teams. Any imbalance can hinder progress, particularly when it comes to the skill sets and personas grouped together — you need a team structure that empowers your people and enables them to be able to work together and learn from each other effectively.

Strategies to help

  • Understand what you have: Establish which skill sets and competencies are present and/or missing before recruiting new team members.
  • Understand what you will need: Consider how the team structure will have to change as the business grows and allow that to guide recruitment.
  • More people or better people?: Upskilling may prove more fruitful than increasing headcount. Providing your teams with coaching opportunities and mentorships is an effective way to see this through for the long term.

Preventing business autonomy

Team structure is critical; small and independent is preferable. Failing to allow units to self-organise and collaborate autonomously introduces complexity and limits efficiency.

Strategies to help

  • Prioritise visibility over control: Defer accountability to teams and trust in your talent. Note that smaller teams means greater accountability.
  • Enable communication: Provide the tools needed to communicate internally and with other teams. Ensure that the people you’re putting into your teams have high quality communication skills to enable both their self-reliance and collaboration.
  • Focus efforts: Give teams responsibility for a limited section of product development or delivery. The more you separate the process, the easier it will be to scale.

Losing connection with business strategy

Scaling in a way that doesn’t align with objectives is a direct path to bloat. Every decision should be guided by accelerating the development of processes that improve customer experience, and helping your business achieve strategic goals.

Strategies to help

  • Establish the metrics of success at an early stage: Be transparent about what you want to achieve and how progress will be measured.
  • Establish the right metrics of success: Improving outputs (increasing revenue, profitability etc) isn’t everything. Enhancing outcomes (helping customers succeed) can lead to real transformation.

Not understanding what stage of business you are at

The start-up mentality is intoxicating but it can blind you to the fact you’ve already successfully scaled beyond it. It is imperative to understand where your business is on its journey and what structures are required. 

Strategies to help

  • Understand what’s really going on: Invariably, that means the people behind scaling need a seat on the board or access to someone who does. 
  • Be guided by your infrastructure: Comparing existing solutions with your goals and budget is key to keeping your scaling on track. Be transparent with your teams on how their projects fit into the bigger picture, so that everyone is geared towards the same, shared objective.

Adding too many people too fast 

Hiring more people may seem like an easy fix, but it can ultimately cause more problems down the line if not done well. You have to introduce great people with appropriate structures in place to support them. This is as true of the teams they join as it is the systems you employ.

Strategies to help

  • Build teams around experience: This provides the stability required for growth. Getting help from the professional services of experienced consultants could prove a more effective — and stable — solution than increasing headcount. 
  • Look for untapped potential: Underutilised talent is present in every organisation. Reassigning them to tasks that help them better realise their skills boosts both efficiency and morale to foster a more inclusive work culture. 

Scaling at the wrong time

This equates to being out of sync with the growth you’re experiencing/are likely to experience. It can lead to unsustainable operations — and missed opportunities.

Strategies to help

  • Don’t put objectives before market conditions: Scaling is a process that requires constant review. Where possible, avoid one-way decisions. 
  • First principles: Maintain your understanding of your users/customers and their relation to your product. Ensure feedback colours your strategy.
  • Consider culture: Achieve scale before you’re ready and the culture of your organisation can suffer. Dunbar’s number states we can only maintain 150 relationships.2 Think how your company will operate if staff exceed that and always consider how you can further empower your people.

Staying true to core company values when hiring new people

People are drawn to start-ups and small businesses because they enjoy the environment. Maintaining culture while enhancing the business model is challenging; missteps can push your best people towards the door. 

Strategies to help

  • Value soft and hard skills equally: The traits that help people work together are just as important as technical capability. 
  • Hire intentionally: Diversity and inclusion must inform recruitment. Imbalances undermine meritocracy.
  • Improve what you have: Upskilling employees can create a more effective, empathic — and welcoming — workforce. 

Having a solid onboarding process

Allowing new starters to arrive into chaos will leave them feeling unwelcome and undervalued. It may lead some to reassess their decision.

Strategies to help

  • Communicate changes: Everyone should know what role the recruit will perform and where they will work.

Lacking clear objectives and/or a plan for measuring progress

Clearly defined goals and performance indicators are essential. Fail to set and share these and you can expect drift. Maintaining open communication and collaboration is what’s ultimately key to solving this.

Strategies to help 

  • Prioritise visibility: Every employee should know organisational goals and what progress has been made. The latter could, for example, appear on a company-wide dashboard.
  • Contextualise objectives: Relating team goals to wider business objectives increases motivation while simultaneously fostering a sense of inclusion.
  • Evaluate success from a user perspective: This keeps you focused on the right things while helping you quantify the impact on the bottom line.

Condensing the hiring process

A thorough recruitment policy is important; excessive processes risk alienating the best candidates. You have to strike a balance.

Strategies to help

  • Screen effectively: Establish close-fits and deal-breakers from the outset.
  • Act decisively: Respond quickly to candidates and keep interviews focused. 
  • Avoid technical tests: Unreasonable demands will deter busy professionals. Build a network of capable people so such tests become unnecessary.

How to think about scaling

We know that no two businesses are the same and their plans to scale shouldn’t be either. But there are some guiding factors that would be ideal for all businesses to keep in mind when it comes to scaling efficiently. Those would be:

  • Better-skilled people over more people. And that includes teamwork and collaboration skills on top of great technical expertise and experience.
  • Aligning everything with business strategy.
  • Create accountable, autonomous teams. 
  • Empower those teams through technology.

The key to scaling is being able to apply those principles simultaneously. One cannot stand without the other. 

When thinking about scaling, it’s essential to understand why you’re doing it, whether the timing is right and how you are going to meet the above criteria. It’s a big ask, but every successful business owner will tell you that is both possible and rewarding.

Suggested reading: A tech consulting partner can bring great value to your business — find out more on how to choose the best one for your strategies with our blog How to Identify the Right Tech Consulting Company for You in 2022

Do you need a scaling partner?

We can’t answer that question for you.

What we can say, however, is that the scaling process is complex and extends far beyond the scope of this discussion. We can also add that we at 101 Ways are made up of experienced people who know how to bring in the right solutions and empower people to enable success. And we don’t just look to solve your problems — we build up a partnership that keeps you growing at scale.

If you’d like to know more about what we do and how we can help your business, get in touch. That part couldn’t be easier. 

New call-to-action

Footnotes

1 IDC Reveals 2021 Worldwide Digital Transformation Predictions; 65% of Global GDP Digitalized by 2022, Driving Over $6.8 Trillion of Direct DX Investments from 2020 to 2023

2 Neocortex size as a constraint on group size in primates – ScienceDirect