Most business owners want their business to grow. The challenge is that growth brings its own set of problems with it. I think two of the most critical issues related to growth are financing and leadership.
One of my clients who has a manufacturing business in Virginia has had triple digit growth for the past several years. Obviously, that requires some serious capital for expanded payroll, as well as for inventory. Without her line of credit, she would have been in trouble.
Another client of mine runs a multi-generational, family owned health care business in Arizona that has several divisions including nursing facility, residential care facility, home health services, and more. They have an aggressive growth plan that has seen the construction of new buildings and addition of new programs over the past few years. That, too, of course, has required significant loans.
You may have a good relationship with a local banker. Many business owners don’t realize that there are also financing and insurance groups that specialize in specific industries such as health care or automotive. For example, Bankers Healthcare Group are experts in providing financing for health care professionals. Whether you need funding for a new building or just plain old working capital, don’t sacrifice your growth due to lack of adequate financing.
It’s a great idea to get a line of credit (L.O.C.) before you need it. If your business grows more slowly and you don’t need the L.O.C., no problem. But if you need the funds, they’re available when you need them. Many businesses have failed to grow or failed altogether due to inadequate capitalization.
Another key growth factor is your leadership skills. I would say this is the most critical factor of all, and the most difficult. It’s the one my Arizona client – and many of my other clients – struggles with the most. Running and growing a business these days is very tough. Competition is intense, laws and regulations can be daunting, even overwhelming, and leading your management team successfully is essential.
In most cases being a strong leader requires a skill set that is learned, not born into. So if you just “wing it” as a leader, the chances are exceedingly good that you’ll fail. You have to commit to developing yourself into a leader who can take your company where you want it to go. This development may include attending workshops, working with a business coach and reading some of the classic books on leadership and communication.
One of my favorite guides for this process is the book called The Leadership Challenge: How to Make Extraordinary Things Happen in Organizations by Kouzes and Posner. This exceptional book is now in its 5th edition. The five practices on exemplary leadership according to the authors, who studied thousands of leaders for many years, are
- model the way
- Inspire a shared vision,
- challenge the process)
- enable others to act and
- encourage the heart.
The book is loaded with real life stories that will educate and inspire you. A few other books that I also recommend include:
- The Five Dysfunctions of a Team by Patrick Lencioni, which reveals the five dysfunctions which go to the very heart of why teams even the best ones-often struggle and outlines a powerful model and actionable steps that can be used to overcome these common hurdles and build a cohesive, effective team.
- Leadership and Self-Deception by the Arbinger Institute. Through a story everyone can relate to about a man facing challenges on the job and in his family, the authors expose the fascinating ways that we can blind ourselves to our true motivations and unwittingly sabotage the effectiveness of our own efforts to achieve success and increase happiness.
- Discipline without Punishment: The proven strategy that turns problem employees into superior performers by Dick Grote. Highly recommended. Step by step guidance.
- What Got You Here Won’t Get You There by Marshall Goldsmith, which identifies 20 of the most annoying interpersonal issues in the workplace and help you figure out which ones apply to you and how to fix them.
- Crucial Conversations: Tool for Taking When the Stakes Are High, by Patterson and Grenny. This book has revolutionized the way millions of people communicate when stakes are high. And provides the tools to prepare for high-stakes situations, transform anger and hurt feelings into powerful dialogue, make it safe to talk about almost anything, be persuasive, not abrasive
To successfully growth your company, you must commit yourself to a program of self-development. Commit to reading at least one book a month. Many of the most successful business people read one or two books every week. But even if you read one a month, within a year, you’ll have some amazing insights and tools you can apply to yourself and in your business.
Books are fantastic, but of course you need more than that. You need consistent, live input and feedback from qualified people. These could take the form of a mastermind group of non-competitive business owners, a business coach like myself, or a mentor who is willing to talk with you regularly. With the tools of phone, video chat and email, these people don’t even have to be in your same geographical area. While the buck will always stop with you, as owner of your business, that doesn’t mean you should go it alone. No one succeeds all by themselves.
In conclusion, in my 13 years of coaching many business owners, my experience is that obtaining and managing the financial resources needed for growth, along with your development into the best leader you can be, are two essential requirements. The good news is that they are both achievable.