6 steps that will take the pain out of expanding your business

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6 steps that will take the pain out of expanding your business

One of the many goals of most business owners is growth and, for some, this requires the business to expand to multiple locations. As soon as this happens, the business owner loses control over the actions of employees not in their immediate vicinity, which can see problems develop with regard to consistency, quality, and reliability.

A dispersed workforce creates unique challenges for business owners, especially if their skillset wasn’t already in people or quality-management. The same issues can be seen around businesses that are franchised as well as businesses that simply expand to multiple locations. And, when the additional locations are geographically far away, managing them effectively can become even more time consuming and expensive.

However, this shouldn’t dissuade business owners from seeking this kind of expansion. After all, the need to expand suggests that the business is succeeding and growing, which is positive. This expansion phase represents both a threat and an opportunity for business owners. It’s a threat because failing to manage the expansion effectively can damage the business’s reputation and set its growth trajectory back. But it’s also an opportunity to put strong processes and systems in place that will make it possible for the owner to step back from the business and act more as a chairman and shareholder rather than as a day-to-day manager.

Nowhere is the learning curve more clearly illustrated than in the example of one of the most famous brands in history; McDonald’s. After setting up their original drive-in restaurant in 1940, the McDonald brothers attempted to franchise their wildly successful concept in 1953. However, without their personal oversight, the franchisees were out of control and didn’t deliver anywhere near the consistent quality of the original restaurant. This gave rise to a strict franchise system with clear obligations and responsibilities for the franchisees, which continues today across more than 37,000 restaurants around the world.

To emulate this success, there are six key steps that a business owner needs to take, regardless of whether they’re franchising or just expanding:

1. Motivation

It’s essential to clearly understand the reason behind setting up another site and ensure the new site delivers what’s expected of it. This includes making sure that the business has financing set up to cover the new site, as there will be additional costs that need to be accounted for.

2. Resourcing

Setting up a new site takes time to recruit and train staff, as well as the time it takes to find the right site, negotiate leases, etc. This can take more time than anticipated, so it’s important to set realistic deadlines. And, because it can take significant time away from daily activities, it could be worth appointing someone whose sole responsibility is to manage the expansion. This person needs to be well-versed in company culture as well as the reasons for expansion so they can effectively execute the expansion strategy.

3. Culture

Maintaining a strong and positive culture can be tricky enough when all employees are in a single location. Expanding to multiple locations creates potential for micro-cultures to spring up in satellite locations. It’s crucial to have a strong set of systems and processes that employees adhere to automatically as part of the culture. Without that cultural impetus, the business could find that employees go their own way, which can negate all the hard work done to get the business to this point.

4. Processes

Expanding to new sites requires a whole new set of systems and processes around recruitment, induction, and training. It’s essential to standardise these processes so that each new employee receives the same experience, setting them up for success. The most successful businesses can even monetise these processes by offering them to others as a product or as a service.

5. Data

Business owners rely on data to make smart decisions. As the business grows, data becomes even more important, especially since decision-makers may not always be on the ground to get information first-hand. Access to comprehensive, accurate, and real-time data can help overcome the distance factor in maintaining control.

6. Training 

New staff members aren’t the only ones who require training. Managers also need their skills to be developed as they take on new responsibilities and new staff. Providing senior management training is crucial to ensure the people in charge of new offices and teams can be effective and autonomous.

With these six steps in place, business owners should be able to expand to new locations with confidence, celebrating their company’s growth and minimising the risks. It’s also important to remember that the risk doesn’t only come with the initial expansion but, as the organisation continues to do business in the future, systems and processes that were previously adhered to can fall by the wayside. Therefore, it’s essential to ensure ongoing management and oversight to maintain consistency.

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Andrew is on a mission to enable millions of business owners to not only create great businesses but also to lead incredible lives; lives providing the freedom that business ownership always promises yet rarely delivers. His systematic approach to designing and creating your ideal life and business is the one that he has implemented himself, to great effect, and that has been implemented successfully by countless clients. Regularly ranked among the top business coaches globally, and recently recognized as the top Executive Coach in Asia Pacific, Andrew has supported countless others to build prosperous businesses, delivering their owners enviable lifestyles. His approach to executive coaching is based on his business acumen and principles used when he grew a business from $50 million in sales to $2 billion in sales in under two years. Andrew has lectured in strategy and management at Sydney Business School, holds an MBA from INSEAD, Degrees in Economics and Law (Honors) from the ANU and is a published author of business books on both strategy and management.

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