Ronnie Altit returns with his tips on how to ensure your business continues to be sustainable even during periods of rapid growth like those experienced by his own young company Insentra
Hi again. I re-read my last blog to see the teaser I left at the end and it was about how to “stay sustainable”. I realised it may have been a little tautological... ‘staying’ sustainable. If you are ‘sustainable’ as a business you will stay there right? That’s why you can say your business is sustainable! Fortunately I know how to speak Ronnie, so I know what I meant, which was how do you ‘maintain’ sustainability when your business is growing?
We have been in the fortunate position at Insentra where our business has grown very rapidly. In 18 months we have expanded to 16 permanent headcount and have maintained our cashflow positive position with zero debt. The key to maintaining sustainability is to ensure that the right foundations are in place.
First and foremost, as mentioned in one of my other blogs, managing the cash position is critical. Too many small businesses fail as they grow because they lose focus on their cash position because they have too much else more exciting to address. No cash, no business.
Staff are very high on the list. Let the CFO/accountant worry about the money and let the management focus on the staff! Recruit the best and treat them like they matter because they do! In fact they are the substance of the business. Their job satisfaction and happiness are fundamental ingredients in building a sustainable business and don’t just take that as rhetoric. If you don’t truly believe in this and act accordingly, your business will not be sustainable. Simple.
I am not sure of the exact statistic however in my experience, losing a staff member has an impact of 3-6 months on productivity. By the time a replacement is found and trained in the ways of your business, much time has elapsed and with it has gone opportunity. Of course businesses will lose staff – it is bound to happen. If you are close enough to your staff, however, more often than not you can work with them on a ‘planned departure’ to minimise the impact. If your staff member comes in and resigns one day and you are surprised, take a good long look in the mirror because it is then that you will see the problem! Every business must have their staff top of mind and do all that makes sense to ensure a happy, FUN work environment to ensure sustainability is maintained.
Automate automate automate! From the very beginning, it was important to us that anything that needed to be done more than once and could possibly be automated should be! That is a serious undertaking and it in itself requires time and effort to reap the rewards and is easy to deprioritise. When a business grows, things get busy, corners start to be cut and quality is always impacted. Achieving a balance between managing growth, maintaining quality and controlling costs is tough to do without systems in place. The easy answer is to throw more bodies at the problem and sometimes that is the correct answer. However, the question I always ask is “can we automate anything to make us more efficient and avoid incurring additional headcount and costs in the business?” If the answer to this is yes, then the balancing act commences – how long will it take to automate? What will the impact be on current staffing during this process? Can we afford the automation process right now? What is the return on investment? Doing things manually time and time again is a sure fire way to hamstring your business.
Communicate internally– lots! Part of the Insentra philosophy is to over communicate – both good news and bad. In many organisations staff are kept in the dark, particularly when there are issues in a business – which there always will be. Who better to help address these issues than the team of people you employ? If the business is not meeting its sales targets then why not tell the team this is the case and look to them for ways to bridge a gap? Does it really matter if your staff know what that number actually is - I think not. Make your staff a part of your issues and you are guaranteed a better outcome. And equally important is the celebration of success. Catch someone doing something right and when you do, broadcast it widely. Sure, some people don’t like the public recognition but in the 20 years I have had the pleasure of managing staff, not one has come to me to tell me to not share their successes with others.
At Insentra we share the vision, goals and direction of the business and report back to the staff regularly – fortnightly in fact. Everyone who works at Insentra should know what has been and will be happening for the business to meet its strategic goals. If they don’t then how do they possibly feel like they are contributing in a broader sense than just fulfilling their every-day roles? How also do they know what management are doing on a day to day basis? Treat staff like mushrooms by keeping them in the dark and feeding them sh*t all day and you will only ever get fungus in your business!
Now, this is by no means an exhaustive list – I have left out items like managing risk, saying no, making the hard decisions, walking away from ‘bad business’ as some examples that perhaps I will talk to in the next blog. I am certain many people will have other suggestions. How about you post a comment on this article with your experience and suggestions?
Till the next time…. And if it is not before the festive season be safe, be happy and be sustainable!
Insolvency accountant asks: Have you paid your tax yet?
By John Papadopoulos
Ask the Experts: Does automation stack up financially?
By Christopher Overton
Opinion: How bad do things have to get?!
By Adam Zuchetti