Growth Means So Much More Than Sales
It’s easy for small busineses to be focused on growth. Sales, income, and adding people are commonly associated with the idea of “growth.” But, there’s so much more to it. When a small business experiences growth, it evolves through a web of tangible and intangible effects. Some outcomes are way more obvious than others, although they’re almost always evident. And some are more positive or negative. The key is to be aware of the process that unfolds because it’s often unpredictable and can happen slower or faster than ever anticipated. This is why there’s way more to growth than sales. Moreover, there’s a big difference between growth and progress, although they’re closely related. When used properly, this difference can steer teams clear of many challenges, a common one being competing demands, which will compromise almost any organization.
Leveraging the Difference Between Growth and Progress Increases the Likelihood of Success
A Tale of Letting Growth Run Your Small Business
For context, here’s an example of the difference between growth and progress. One brother decides to help another by starting a new business venture together, partly out of sympathy and curiosity but mostly out of the desire to make money. Early on they complement each other and capitalize on their strengths that make up for the weaknesses. Their last name is on the building. A couple of prospects become customers and then turn into raving fans. Word of mouth takes over. Before long, the business experiences growth and both brothers begin to make money. Lots of it. Organic and rapid growth take over and the two owners hire whoever they can find. They simply need warm bodies and hold on for dear life.
Seven years pass with amazing year-over-year growth before sales plateau in the eighth year. People are burnt out, tensions are high, and the drama between both brother-owners skyrockets. Before long, their relationship erodes, sales vanish, and the pressure to maintain overhead for 20-some employees mounts. Then, the firm’s reputation gets tarnished as quickly as it blossomed. Soon the mass exodus of talented people begins, one brother buys out the other, and the business is swallowed into the black hole of competing demands. The magic disappears, the team dissolves, and the once-booming business is a shell of itself. And the one brother who initiated the endeavor is now overtly negative and biased about being a small business owner. He shuts everything down and resigns himself to never wanting to live with ownership responsibilities ever again.
Does this sound familiar? Chances are you’ve heard of a local small business like this. They’re everywhere because, according to the U.S. Census Bureau, private firms that employ fewer than 20 individuals in 2014 accounted for 89% of all domestic firms. That means almost 9 of every 10 local businesses employ fewer than 20 people. How could a small business like this avoid being swallowed by the black hole of competing demands? The answer is they fail to understand and leverage the difference between growth and progress.
Why Does the Difference Between Growth and Progress Matter?
The difference between growth and progress affects a small business like the one described above for one reason: competing demands. Just like small businesses, competing demands are everywhere. And they’re all-consuming. What is more, they’re so pervasive because the relationship between growth and progress is often unclear. This is important because one supports the other and creates chaos if there’s no separation. Moreover, it’s tough to know which one to focus on first. As a result, growth is often associated with obvious things like sales or revenue. But, like a lot of things, growth has many layers, each of which creates a ripple effect. Just the like brothers who started a business together, growth and progress must complement each other to become stronger and to overcome weaknesses.
Merriam-Webster describes growth as an increase in something, whereas progress is onward movement or the gradual betterment toward an objective or goal. In business, the first connotation with growth is sales or revenue. Beyond this initial glance, though, other attributes like size, scale, pace, or complexity help to define growth. Intrinsically there are leadership, skill-sets, knowledge, and vision that also influence growth. Meanwhile, progress is still generally all about an ongoing effort towards something. Understanding and owning these differences is the key to unlocking the power of each.
5 Ways to Leverage the Difference Between Growth and Progress
Here are five ways for small business owners to leverage the difference between growth and progress.
- Define and contextualize growth AND progress for your small business. As mentioned above, if growth is about an increase in everything from revenue to complexity and leadership skills to knowledge and vision, then progress is all about facilitating the ongoing effort towards increasing things that grow. Moreover, please know growth has its negative sides, as well. The more your small business grows, the more complexity and the responsibility to support more people adds pressure, especially for owners. This never stops—it only grows. Every small owner will feel the change from hiring their first employee, to the fifth, twentieth, and so on. It can be a lot to embrace, manage, and lead if the owner is unprepared for ownership responsibilities. These small business owner tasks and responsibilities are just the beginning of what amounts to a lot of pressure to lead and perform for others, let along yourself.
- Visualize how growth and progress complement each other. Instead of shying away from this pressure or ambiguity, own it and make the most of growth and progress. Use your vision to think about what you want to grow (i.e., the objective to your growth) and progress (i.e., your indicators or key results) to determine how you intend to grow. OKRs, which stands for objectives and key results, are particularly popular in tech firms but can be applied to any organization. They help organize what you want to grow and how you intend to make progress towards it, which creates clarity and structure.
- Mobilize effort around growth and progress. Growth and progress are only as good as your ability to mobilize effort around the same vision, objective, and key results. To do this, develop a work plan that outlines a SMART objective, key results, necessary resources, potential constraints, roles, and responsibilities. Doing this will help to ensure that a clear growth objective is articulated with supporting progress understood and community. STRE.ME’s Strategic Boost Template will help you create manageable and actionable work plans. In turn, you’ll be in a better position to create value by creating value with confidence. Get the free guide here.
- Get the right people in the right spots to make progress towards growth. Roles and responsibilities should always be evident in a work plan with OKRs for two reasons. First, a well-defined work plan sets expectations for everyone involved and, as a result, increases accountability. This Strategic Boost Template lets you facilitate conversations with team members to get their input, refine and improve the work plan, and ultimately let team members determine their roles, responsibilities, and timelines. This level of participation can increase employee buy-in. Then, second, as the business owner, you get a better sense of capacity utilization levels, which measures your firm’s productivity level of output against available time. You’ll know whether you’re adequately staffed to carry out the work plan by simply evaluating its roles and responsibilities. Ideally, individual team members are responsible for different key results. Otherwise, as the small business owner, you’ll continue to have competing demands that stunt your growth. At least you’ll have a better sense of being pulled in specific directions before starting the process.
- Know how to measure progress towards growth. Your work plan’s key results will serve as indicators, which are also known as key performance indicators or key metrics. As these indicators become more evident through regular progress, your desired growth will come. This is the point where you need to focus on making progress before growth because this is where it’s all about your ability to mobilize effort around the same goals. Otherwise, your small business will be making progress on multiple fronts, which delays results, creates competing demands, dilutes resources, and increases complexity. Then the black hole of competing demands will swallow everything in sight. Literally.
Getting Growth and Progress to Work Together
When small business owners can get growth and progress to work together, they gain focus, clarity, and confidence, and increase the likelihood of success. It’s the difference between herding cats and rowing in the same direction. Which do you prefer? Same for your team. Simply put, the more your team can make progress towards the same growth objectives, the more likely you are to be successful, especially as a small business owner. Otherwise, you’ll end up being swallowed by the black hole of competing demands, just like the brothers who went into business together and let growth get the best of them. Knowing how to complement growth with progress requires effort, clarity, structure, and accountability. But controlled growth and increasing the likelihood of success is totally possible for those who can understand and leverage the difference between both.