The danger of growing too quickly

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It seems almost impossible to even think that a small business could grow too quickly.  Isn't growth one of the indicators of a successful business?  Doesn't growth mean that sales and profits are increasing, and what could be wrong with that?  When entrepreneurs begin their business are they not looking forward to the time when that business is growing?  Actually, there isn't anything wrong with growth as long as it can be properly managed.

Growth becomes a problem when the owners/managers find out they can no longer manage the business.  The business has grown faster than they have when that happens.  A growing business demands more of its owners/managers, and sometimes they are not capable of meeting those demands. 

Growth is also a problem when the business does not have the systems in place to manage the growth.  A few years ago a university set a limit for new students for the first time in its history.  They had grown so fast their personnel and computer systems could not keep up.  Their student advisers were overwhelmed by the demands of incoming students.  Much of administration was in shambles so the university president announced a limit on the number of new students the school would accept.  He also announced major changes in personnel, new computer systems, improved dorms and eating facilities, and a general upgrade in much of the admin department.

In the company I owned we had grown the business to the point that we needed to add new team members to install the equipment we were selling.  I hired new people, bought them a vehicle to use, and waited for a big increase in profits.  It never happened.  We were not structured as a company for that rapid of growth.  There were breakdowns in communication.  People were not properly supervised.  In short, we were not prepared to grow, or a more appropriate way of looking at it, I was not prepared for the changes that would be expected of me as our company grew.  My leadership was the lid that held our business captive and eventually forced us to return to our previous levels of sales and manpower.

Sustained growth should be the goal of every small business owner.  You want your business to grow, but that growth must come slowly and include everyone involved in your company.  For this to happen the owners must be committed to on-going growth in their own lives.  You must be continually growing so when the time comes for your company to take it up a notch you'll already be prepared.

Sustained growth also depends upon the systems in place in your company.  Do you have the computer hardware and software that will enable your business to grow?  Do your team members have the training they need to handle new expectations as the business grows?  Do you have the right policies and procedures in place for sustained growth?  These are important questions that must be answered before your company enters into any type of growth.