In general, growth is a good thing, but for the small business owner it is important not to see it as an end in its own right. Continual growth is more likely to be required by large public companies with investors and shareholders hungrily pushing for their dividends and returns. In the rather more humble world of starting and running your own business, however, this may be less important. Obviously when you start, you start from scratch, and so year one will always involve growth. But if you succeed your desired size and state fairly soon, say in the first year, then further growth may not be what you want thereafter. For example, if you successfully establish a coffee shop with four staff, then you might not want to open a second one. So it is important to view growth in its broadest context so that you can pursue an appropriate, manageable rate of it. This is a quite separate point from durability. All businesses should aspire to durability.

THE PROS AND CONS OF GROWTH

Sometimes starting is the easy bit. After the initial excitement there are new challenges, and getting bored or stagnating in year two is one of them. You need a view on what type of growth is good for your business, and how you are going to remain enthusiastic about it. As a starting point, it is good to ask whether growth is always a good thing. Although the answer sounds obvious, it may not be as simple as it first appears. For some businesses, reaching a certain level and staying there might be more desirable than growth for the sake of it. Straightforward survival might even be acceptable for many. Growth might be necessary, or desirable, but it certainly brings with it many issues.

To stay as you are is impossible in the strictest sense, because there will always be something about your business that is changing, even if the essential shape of it is the same, and sales are the same as last year. Momentum is important but size in itself is not. Many people who start a business have a certain shape in mind, and if they achieve it within the first year or two, then maintaining that will be the goal, not world domination. Nevertheless, many entrepreneurs claim that it is important to adopt a mentality of growth, even if growth is not the main objective. Most agree that there is good growth and bad growth. Good growth is planned, expected, and comes judiciously. The business gears up appropriately. Resources and staff come along on the journey in a reasonably orderly way, and methodical forward motion keeps everyone happy. The chances of this happening smoothly are, of course, quite low. Most businesses experience lurches in fortunes to which they have to adjust. Growth is good as long as it is profitable. If growth merely lowers the margin then the business may superficially appear to be in great shape when in fact it is heading for a loss, albeit from a bigger base. As such, it is critical to differentiate between higher turnover and better margin. Higher turnover is good if it brings with it no loss of quality and no margin reduction (even better if the margin rises). Higher turnover with a slightly lower margin may just be acceptable, but any significant margin reduction is not desirable. As the old saying goes, turnover is vanity, profit is sanity.

Bad growth is doing things for the wrong reasons. Rapid growth can endanger quality and reputation. Standards can slip if a company pursues money just for the sake of it. Getting the order out of the door at breakneck speed simply to rush into the next customer’s demands may build a business in the short term but is unlikely to be sustainable. It could simply generate a misleading spurt of activity and build up problems for later. It is important to make sure that quality of service and product is maintained. Of course growth usually involves making a lot of mistakes. This is understandable and perfectly fine as long as lessons are genuinely learned. If the mistakes are ignored and simply repeated, then no progress is made. Knowing when to turn down business is an important skill to develop. Natural instinct suggests that you should accept all business that is offered, but this may be a mistake. Customers that prove problematic can ruin the business you have carefully built up. This could be because they are demanding lower prices, because they are unpleasant to deal with, or just because they unwittingly force you into areas that you didn’t originally have in mind. Remember that a principle isn’t a principle until it costs you money

So be careful to manage, control and plan your growth as far as you possibly can. It’s your business, so you reserve the right to dictate how it develops. Do not pursue growth for growth’s sake. Instead, devise your vision for what the business should do, and then the growth will follow. Equally, do not compromise or dilute what you set out to achieve in the first place, or what your customers consistently tell you that they like. Many businesses have veered off by not ‘sticking to the knitting’.

ANALYZE YOUR PRODUCTS AND SERVICES

Imagine your business as a series of rivers and dams. These will be areas where everything is flowing well, or where there are frequent blockages that prevent you from conducting your business properly. The first step is to ask some questions and write down the answers. Start with the good stuff:

• Where are the rivers?
• How many of them are there?
• How large?
• How small?

Then repeat the process for the not-so-good things. Which do you have more of – rivers or dams? This exercise should allow you to see at a glance what works in your business, and what doesn’t. It will also reveal straight away whether the business has more good things going on than bad, or vice versa. Don’t panic if there seem to be way more dams than rivers. Your next step should be to initiate more rivers and unblock the dams as fast as possible.

Ballistics is the study of the flight dynamics of projectiles: the interaction of the forces of propulsion, projectile aerodynamics, atmospheric resistance and gravity. These five areas provide a useful analogy for working out why things are happening in your business:

• Projectiles: who, or what, is heading where?
• Propulsion forces: who, or what, is making them do that?
• Aerodynamics: who, or what, has good momentum behind it?
• Resistance: who, or what, is resisting forward motion?
• Gravity: is there anything structural that anchors any of this?

You can now review the rivers and dams information through the eyes of the ballistics categories. Use the questions associated with each component to try to unravel how something might be resolved. For example, does a resistance question help solve an issue? Does the gravity of the business explain why something is as it is? Does a propulsion force provide a clue as to how to fix a dam? The sequence of questions can be repeated for each type of motion. What type of motion are we dealing with here? Who, or what, is heading where? Is that good or bad? If it’s good, how can it be replicated elsewhere? If it’s bad, how can it be fixed?

If you work in a highly technical business area and have specialist staff, you may need to involve them in this process. Their knowledge of the technical detail may be able to answer some of the more tricky questions, and there is no point in generating scores of questions that you cannot personally answer. Far better to embark on the process with an approximate idea of what you think might emerge, and have the necessary people on hand to help you out. Diving into any wide-ranging thought process without decent preparation is also inadvisable. If you embark on it with only one angle, you may only generate the one solution, and it will probably be the same as everything you have come up with before. Most issues have multiple possible solutions, so you need to stay open-minded as to what these might be. By the end of this exercise you should have a comprehensive review of your products and services, and an action plan of what to do next.

A word of warning about the positive things that fall into the rivers category: do not be tempted to claim that these things were wonderfully devised and thought through if, in truth, they were actually a fluke. Only you know the reality of this. If you allow this to happen, then you will assume that their success can be replicated if you repeat the process, which may not be the case. So when looking back at successes in your business and looking for inspiration, always admit if something happened by chance. Far too many people (and businesses) rewrite history to claim that a random success was carefully thought through when many are not.

KEEPING THINGS VARIED

To run a successful business you need to stay sane and relentlessly enthusiastic. The definition of sanity is ‘the state of having a normal healthy mind’ or ‘good sense and soundness of judgement’, so we are describing the condition of a rational person who feels well balanced and reasonably calm. Many aspects of modern life would appear to be designed to unhinge us at every opportunity, and the pressures of any breadwinner in today’s society are well documented. So it is important that you engineer a set-up that keeps you as calm as possible. Equally, enthusiasm is an absolutely fundamental prerequisite of someone who runs a business. Nobody else is going to generate business for you. No one else is going to be enthusiastic on your behalf. The job falls to you. People don’t usually want to do business with someone who lacks enthusiasm, so one way or another you need to find a way of having an endless supply of the stuff. Keep lots of variety in what you do to stay fresh. Get keyed up for phone calls and meetings, and try to be in a good mood before you do them. Change things if you don’t find them interesting. And take a sensible amount of time off so that you can return to your work energetically.

The net effect for your customers should be that your enthusiasm appears to be relentless even though, of course, it is impossible for any person to be in that state as a permanent condition. A vital part of this is taking the right amount of time off work. How many times have you heard a self-employed person say that they haven’t had a holiday for ages? Even if they have arranged it and left the country, they still keep worrying about the business when they are lying on a beach somewhere. This is a poor formula that usually leads to some form of meltdown, with both the business and the individual inevitably suffering.

One helpful trick is to build time off into your plan for the year. Try not to do it on the fly halfway through. If you do it ad hoc like this, there is a very strong chance that the break that you do go for won’t really do the trick. You will almost certainly have compromised on one aspect or another, and this does not befit the reward that you have earned. So look at the year and ask yourself these sorts of questions:

• When are the best times of year to be away?
• Will you take one large chunk or several smaller bits?
• Do you need a sabbatical?
• If so, how would you arrange it?
• Could you plan to work a 10-month year instead of 12?
• Where do you want to go?
• In what sort of style?
• With anyone else or on your own?
• What sort of research do you need to do before you can answer some of these questions?

When you take time off, try to be genuinely unavailable. There is little point in taking a break if you spend a vast amount of it checking messages on your mobile phone or logging on to your e-mail system. Be sure to put the measures in place to explain why you are not around before you make yourself unavailable. Also don’t forget that corporate time moves differently to normal time, so many of your customers may not even notice that you have gone away anyway.

Try to follow these simple steps to taking time off and being genuinely unavailable. Put your mobile phone in a drawer and don’t take it with you. If you must, then limit the times per day that you turn it on. Do not visit an internet café unless you have a burning need to contact a loved one. Do not take any work material with you at all. Change the messages on your phones to explain what is going on. Set up an auto response on your e-mail to do the same. Tell your customers a long way in advance that you will not be available (in certain types of work, this may even mean that you actually receive more work before you go so that their needs are covered whilst you are away). All in all, this approach works well. There will of course be some lines of work where you really do need to be contactable, but you can judge the level of that for yourself. If you apply even a few of these disciplines, you will stand a better chance of having a decent break, and that will be in everybody’s interests.

DEALING WITH SETBACKS

Setbacks are an inevitable part of business life, but small businesses should not feel that they are at the mercy of larger ones. If, on reflection, you feel that your business is being too servile, under-charging, over-delivering and generally being too subservient, then it is time to change something. Fear often prevents businesses from confronting customers who mistreat them, because they think they will lose the business, that they will never replace the income, or that the customer will never change their approach. The outcome is rarely as disastrous as was originally feared and it is undoubtedly better to ‘die standing up than to live on your knees’. Sometimes, bullying customers do listen to comment and try to change their approach. Even if things can’t be reconciled and their custom moves on, many businesses find this quite liberating because it allows them to reinvent themselves in another area with other customers.

Setbacks and mistakes are rife in business. It can be very cathartic to come clean about your business disasters. It is all about learning and being human. We all make mistakes, and when we have made enough, they call it experience. For example, some people have terrible trouble with their selection of business partner. They originally get together because they think they will make a good team, or that the other person will compensate for skills that they don’t have, but after a while it can go wrong. The most commonly stated gripes are unclear roles, lack of communication, or changing opinions. So if you have a business partner, one key to durability is to talk frequently and make it clear what you want. On the personal front, all sorts of trouble can brew. Business owners talk of almost burning out, not looking after their personal relationships, and many other problems. This is a highly personal area, and it is important to pay attention to yourself, and those who care about you, so that the business doesn’t take over your life.

Everyone, but everyone, has money troubles. These include, in no particular order, insufficient financial systems, spending beyond their means, not seeking outside investment, under-pricing (and then not being able to raise prices), and not chasing outstanding money quickly enough. The trick is to identify these issues early and do something swiftly. Once you have rectified the problem, you can laugh about it later, or reflect on it ruefully. But make sure that you act fast enough to stop the business going under.

When it comes to not having enough income, there are two main mistakes that businesses make:

Number one is a common problem. Always try to make time for developing your business even when you are right in the middle of coping with what you already have. If you become over-dependent on one or two sources of business, you might as well work for a corporation, and if that business suddenly goes away you will have no pipeline to fall back on. Losing a big or long-standing customer can be a serious blow, but it shouldn’t be a surprise, nor should it be the end of your business. Customers move all the time, and the sooner you acknowledge it, the better. Allocating separate specific time for meeting potential customers and staying in the swing is vital. Equally though, you shouldn’t expend too much effort on scores of little new business leads that are highly time-consuming but very tactical. A typical example of this is companies who draw up no plan of their own and so spend the whole time reacting to inbound enquiries that may or may not suit their needs.

One final point on growth and durability: If you find your business stalling, do stop and ask yourself this fundamental question – what was the original idea? It could refer to a number of things – why you set the business up in the first place, what the vision or purpose of your company is, why you bother to come to work in the morning – anything that is crucial to the matter in hand. The original idea always lies at the heart of what is important. So remind yourself what it was in the first place, and use that as an anchor point to rededicate yourself and your staff to the essence of what you are trying to do. This will help to cement your purpose and provide a clear platform for growth.