6 min read time
Businesses exist to make money. The more sales they can land, the more money they will generate, so growth is usually high on the company agenda. How firms go about achieving that growth will vary greatly and depend on a range of factors.
Large firms may choose to call on the services of specialist external consultants, who will help them figure out what the best growth strategy is going to be. At the other end of the spectrum, micro businesses and very new companies will often be focused on pulling in any revenue they can, so everything is geared towards making sales.
But what about those companies who fall somewhere in the middle? They’re established but not yet as large as they dream to be, and despite their best efforts their growth seems to have stalled and they’ve hit a bit of a plateau.
What is a business growth bottleneck?
It could be that they are falling victim to some of the common business ‘bottlenecks’.
It’s a term that originated in manufacturing, where it referred to a jam on the production line. Rather than the whole process flowing smoothly from one step to the next, an issue crops up along the way that sees it falter. This leads to a bottleneck situation, where a backlog of work starts piling up and things move slowly, until the issue is spotted and resolved.
If you can avoid a bottleneck happening, it will save you time, energy and resources. But, in terms of business growth bottlenecks, it’s not always that easy to spot what’s going wrong.
What could be going wrong?
You need to start with a thorough analysis of your current operations, to try and find any areas where growth may be being hindered. Generally, business growth bottlenecks are found in two areas: 1) people and 2) processes.
Some of the common issues that can arise here, are:
- The owner
The owner themselves may end up being a problem, especially in midsized businesses. They may have had 10, 20 or even 30 successful years with the business to date. What they may not realize is that it is they who are throttling the growth potential of the company.
Management guru, Peter Drucker, describes the situation like this: “As a new venture develops and grows, the roles and relationships of the original entrepreneurs inexorably change. If the founders refuse to accept this, they will stunt the business and may even destroy it. But even among the founders who can accept that they themselves need to do something, few know how to tackle changing their own roles and relationships.” (The Essential Drucker (2001) pg 156)
Owners are often very hands-on in a business. While that’s usually essential in the early days, it might not be so good further down the growth path.
If this is an issue that might apply to you, then it’s time to sit back and take stock. Getting an outsider in to give you their views and pointers will definitely help. It will give you some perspective and new ideas for how to shake things up for the best. Speak to someone who has worked with many other business owners, for their advice.
Closely related to the above, is the kind of culture and leadership that exists within the company.
What does the management structure look like? Does everyone have the skills needed to help the business grow? Can people develop within the company?
There are many different leadership styles and ways to run a company. If your goal is to grow the business, you need capable leaders in place, who can manage both its operations and people. That takes specific skills and sometimes - particularly when a company has slowly but steadily grown over many years – could be the issue that’s causing a bottleneck.
For example, sticking to what has worked in the past can be tempting for some line managers, but may not be the best option for taking the business forward.
One way to get things moving for mid-sized companies with this issue, is to recruit some top talent. Hire in experienced managers from large companies, whose job it is to help you grow the business. They will know the ins and outs of a larger company and will have ideas for helping you get there.
- Growing sales team
Many potential bottlenecks can be caused by the sales team. In the beginning, you’ll often have a sales team of just one - the owner - but very quickly the team is likely to expand.
Financial constraints and other barriers may lead to hiring decisions being made that aren’t always right, or which haven’t been thoroughly considered. The end result being a mishmash of individuals and a team that doesn’t work as well as it could.
It is always wise to consider the sales team as whole - how it is structured, managed, what works and what doesn’t. Your best salesperson won’t generally make the best sales manager. The skills set needed for each role is very different and they don’t always go hand in hand.
Having a good mix of people with different skills can go a long way towards supporting the growth of the team and the success of the business. For more ideas, check out: What does your perfect sales team look like?
- Training & Development
As the business grows, more people will join the team. From the moment the company takes on its first employee, there needs to be some sort of procedure in place for how you will work together.
Defining a set of values can be helpful, even if you’re the only one, but certainly when the team starts to expand. Regular communication and actively working to pull the team together, are also crucial to success.
By now, most firms realize that money isn’t the only motivating factor for individuals. In fact, non-monetary rewards are just as important. As is having the chance to grow and progress through regular training and being able to see a future mapped out with the company.
Yes, we all ultimately go to work because we need the money, but we’ll carry out our jobs even better if we’re happy, motivated and engaged. That can’t be achieved simply by offering the odd off-site team lunch or early finish.
Your best bet here, when trying to guard against bottlenecks, is to systemize the team’s development. Have it form part of your business goals and strategies.
As well as people, bottlenecks can occur within your processes. Some areas to examine here are:
- Operational processes
Look at every area of the business.
Are the processes for your sales, production, customer service, administration, etc, all fully optimized? Are they running as effectively as they could? If not, why not? Is the problem caused by people or systems?
- Systems and Technology
If your IT department is not sitting in on business strategy meetings, then that’s an easy first step to take. In today’s digital world, it is unwise not to work closely with your IT team, to build comprehensive business strategies.
Not only do you need reliable technology to be able to run your day-to-day business operations, but your business itself is likely to need technology to provide the product or service it is offering.
Your IT team needs to understand what the overall business goals are and management needs to understand that without IT, nothing is going to work!
For more on this, see:
- Business CIOs Urgently Needed - But Most IT Leaders Still Don't Get It!
- Technology and what the future holds for sales team
- In-house capacity
Another vital component, when looking for potential bottlenecks, is whether you have the capacity to deal with new business. This can often feel like a bit of a chicken and egg situation.
It will put a huge strain on the company if you land a big deal, then struggle to keep up with the work. It’s a difficult path to tread and one that needs careful navigation. Planning for every eventuality will help you anticipate potential threats to your growth and eliminate them.
Technology can help up your productivity and make the while company run more efficiently. However, there is a learning gap with any new tech and adoption rates aren’t always good.
Using the best software and tools isn’t going to matter if your team doesn’t fully buy in to them. But productivity will increase if you have good processes mapped out, with the right tools in place to support business functions, operated by confident trained people.
- Top ten productivity hacks for B2B sales teams
- Effective time management tips for busy sales professionals
- New business mechanisms
Finally, take a long hard look at the processes you are using to generate new business. Are they as strong and effective as they need to be? Are they current and designed with the modern B2B buyer in mind?
This blog is a great resource for making improvements and getting ideas in this area. It is filled with useful resources and expert advice, which can help you enhance every area of the buyer journey.
You’ll find lots of information, from top tips on increasing the number of quality leads you are generating, to how to close more deals quicker.