Without even defining corporate adolescence, you have probably figured out what it means. It’s a term I like to use to describe that awkward stage in a company’s life when they are no longer small, but not yet large. You have some characteristics of each and it’s downright uncomfortable.
Almost everyone survives human adolescence (somehow). The mortality rate for companies, unfortunately, is somewhat higher. The odds of corporate survival go up dramatically if you recognize its characteristics, acknowledge that you are in it, and learn to cope with it. You don’t put it behind you by just waiting for it to pass.
Adolescence can occur within a wide range of descriptions — and has little to do with how long you’ve been in business. Here are a few thoughts that may help.
You are probably a corporate adolescent if:
- Your sales are in the range of $4-6 million and you have 15 to 25 employees. And you seem to be stuck there. Officially, you are still a “small business,” but you are doing more “large” jobs (think $250K plus). You really don’t know if you are making money. Your employees are a little restless and frustrated.
- You can’t run the business alone. Three guys and a van no longer cut it. You need intermediate management. You need someone to focus on Sales and Marketing, someone on Operations, and someone on Finance and Administration. Trouble is, you don’t know who, where to get them, how to pay them, what they should do, or how to lead and direct them — because you’ve never managed other managers.
- Your financing needs are changing. You need more working capital but your bank is balking at a larger credit line because they don’t think you are profitable enough and they don’t believe your forecasts. They want (gasp) an actual business plan! You’ve probably outgrown your accountant, too — if you have one.
- You are being “forced” into different kinds of work. Your clients (and you have some good ones) are asking for new services, new technologies, new solutions — and you don’t know which ones to pursue. Jobs are getting bigger, more complex, and outside your comfort zone.
- Your systems and processes aren’t getting it done anymore. You’re inefficient, don’t have the reports and information you need, and you are both mystified and terrified about the prospect of more robust software. Your people don’t follow the processes you thought you had in place. Maybe because they exist mostly in your head or are simply part of your “tribal knowledge.”
Sound familiar? Step back, breathe deeply. You can fix this.
The most common denominator we see in adolescent (or immature) companies is lack of documentation. If in doubt, start here: begin writing things down. Your business is changing, usually gradually enough that you don’t notice it much.
You need to document the following nine things:
- Your major markets. Where is business coming from today — by geography, by type of client (vertical), by products or services sold, by size of project? How do you see it changing and why?
- What your ideal client looks like. For whom do you do your very best work? How can you find more like them? How well is your sales team aligned with markets and preferred clients?
- Your processes. There should be established and written ways to do what you do, from front to back. Just to name a few (out of several dozen):
- Use of site surveys
- Clear scopes of work
- Estimating and proposals
- Forecasts of revenue and needed resource
- Order entry/job setup
- Project kickoffs
- Change orders
- Time tracking/job costing
- Substantial completion/project closeout/final billing
- Commissioning to service
- Reporting/monitoring metrics
- A list of “must keep” employees. Who can you not function without, and why? Who on your staff is ready for more? Who is OK where they are but little more. Who is struggling — in danger of losing their seat on the new bus?
- A priority list of next hires. Who (or what skills) do you need next, when, and why?
- Job descriptions — for everyone, but especially for new positions.
- Evaluation of your professional service providers. Many who helped you get started aren’t suited to where you are and where you’re going. Think accountants, attorneys, banks, outside advisors, IT suppliers, sub-contractors, and others.
- A business plan. Simple at first, maybe only for next year. There are dozens of templates and outlines available for this.
- A list of the information you’d like to have available in reports, but don’t.
It follows that once you start this process you will see much of what it will take to “mature” your company, because most of these things are things the larger company has that the smaller one doesn’t.
The process will reveal what you have and much of what you need. That can lead to a list of initiatives to be worked on within your business plan. And talk to others in the business or ones like it, those who have been there, done that.
Someone once asked Wayne Gretzky what made him such a great hockey player. His answer was “I always try to skate to where the puck is going to be.” Point taken, Wayne.