The Three Natural Phases of Successful Small Business Growth
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The Three Natural Phases of Successful Small Business Growth

The Three Natural Phases of Successful Small Business Growth

By John Jantsch

growing a businessI’ve owned a small business for many years and have worked with thousands of small business along the way and I’ve come to sense what feel like natural states of successful small business growth.

A common small business plight is the frustrating cycle of expansion and contraction. I believe this not simply due to the cycle of markets, but more often due to the lack of strategy and proper expectation around planned growth.

I think business owners need to think about growth a lot like a parent thinks about the growth and maturation of a child. But, many simply dive in and try to do things they are not ready to do, lacking the proper foundation of an ideal market, core message and systems and processes necessary to deliver a thrilling customer experience. Now, depending upon a series of what I like to call “success factors,” things such as experience, resources, and networks, some business owners are able to move through these phases much more rapidly, but successful, long-term growth comes from moving in this same fashion no matter what.

Every business should look at progressing through as least three phases (although it’s never quite this linear)

Foundation – this is most commonly associated with start-up, although I’ve worked with plenty of businesses that needed to return here after years of trying to grow without it. In this phase, you are tasked with getting your house in order. This is where you must experiment with finding your ideal customer, testing out ways to differentiate, and finding your secret process sauce. This phase isn’t simply about getting your marketing materials and website created. This is the crucial strategy laying phase and it often requires starting and restarting, but the important element is a mindset of finding your niche and special approach. This phase takes time and patience, something that’s hard to find while trying to pay the rent, but missing this step is lot like skipping grade school and then wondering why college comp is so hard.

Growth – Upon a strong foundation you can start to add the layers of a consistent brand. This, of course comes with a total understanding of your customer, a consistent message, and systems and processes that allow you to deliver a stunning customer experience. Growth now starts in earnest because your business is “referable.” In other words, people start to voluntarily send business to your doorstep. During this phase successful long-term growth is built on taking what you’ve learned about your customer and what they value and expanding your reach, confidently into a larger universe of prospects, knowing that you now have the right message and have developed marketing systems that help you educate and build trust.

In this phase many businesses feel the pull to expand and capture new markets or add new directions, but the wise move in many cases is to actually refine and narrow your focus even more. By this time you’ve likely developed a great feel for your ideal customer or ideal kind of engagement and now is possibly the time to look at becoming a leader in your market or dominating a narrowly defined niche.

This is dangerous phase as well because in most cases this is the place where the owner, the one who may have built the foundation phase as a one person show, will probably need to add staff and start letting go of certain tasks. I say it’s dangerous because some entrepreneurs struggle with the aspect of turning any part of their baby over to someone else and constriction is often the result. The need to build systems that ensure incredible delegation over aimless abdication is the key to success over failure in this phase.

Momentum – Once a business develops the sense of rhythm that comes with a strong foundation and steady expansion into a market, there becomes the space to think in terms of what I call momentum. In business, this is the phase where the business growth seems easy, seems to run itself. Like many things in life, this is simply the payoff for all the hard work put in to date, but it’s more than that. It’s a maturity that comes with an unconsciously competent awareness of opportunities to better serve your existing ideal customer base.

The momentum phase is often marked by other organizations expressing a desire to partner and align strategically with your brand. Your growth is sustained primarily though consistent referrals and a keen eye for spotting ways to do more business with your existing customer base.

This phase is not the done part, in fact, momentum is extremely hard to gain and strangely very easy to stall. (There’s probably a physics equation in that) Maintaining growth and momentum comes from continuously monitoring, measuring, and adapting to the wants and needs of your ideal customer. It comes from staying one step ahead of your competitors and two steps ahead of the new thing. It’s achieved through your commitment to constant reeducation, your openness to new ideas and new ways of doing things, and willingness to take the time and space to get outside your business and learn from the experience that every industry has to offer.

My final point here is to attempt to provide any business owner struggling with growth the inspiration to appreciate that struggle is OK, in fact, it’s to be expected, but also that you must locate where you are these phases of successful growth and commit to doing what it takes to move to the next phase as your primary short terms approach. Do this and your frustration can turn to focus – and focus may be the world’s most powerful tool for growth.

Image credit: Clevergrrl

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