Managing a booming business by preparing for it was the focus of my last post. In this post, a few more insights.
One, know your bandwidth and act prudently. As founder, you will know how much resource you have at your disposal. Conventional wisdom states that we should never turn away new accounts. You need to ask yourself if taking on new accounts will stretch your resources uncomfortably (could be short-term overload) or dangerously (accepting work that is beyond your knowledge and skill sets). Yes, I have worked with startups that promised work that they could not deliver. The results: wasted time and money on everyone’s part, loss of goodwill and trust, damage to that startup’s brand and loss of any future business, referrals and recommendations. My advice is don’t take on what you cannot deliver.
Two, one way that you can manage growth deftly—as you’re juggling on the back-end to obtain more resources and support—is to set and manage client expectations. Let’s say your startup can process 10 accounts per month. Business is taking off and you’re now dealing with 12-14 accounts per month. Lengthen the project timelines. It is always much better to tell your new clients right away that you’ll take a bit longer and ensure that you will meet that set deadline, than to promise an earlier deadline and not meet it. In your clients’ eyes, you want to show reliability. You want to retain their trust and goodwill. You don’t want to over-commit and under-perform. The extra time in the project plan will give you some buffer to gather whatever resources needed to complete the project.
Three, it’s a gratifying and heady feeling to experience fast growth, to see revenue streaming in. Often, unseasoned founders would focus on the revenue part and forget to ensure that the team that enables this growth receives the sustenance and support it needs to stay productive, or even hyper-productive. Remember to manage your human resources well during rapid growth, as your team’s performance will affect how your entire company responds to growth.
From time to time, media will showcase a successful startup story about how the company employees worked in 100-hour week schedule, in frenzied mode. Sounds exotic, but it is not. There’s no glory in working your people to exhaustion nor long-term benefit to anyone. A software founder I knew is workaholic so he expected his entire 14-person team to do the same. At first, he told the team that it would be just, ‘this one-project.’ But he didn’t stop. He kept pushing the team hard, and once the company started generating a lot of sales, all the initial employees were burnt out and started quitting.
I can tell you from personal experience as a project manager of various cross-functional teams that overworked employees do not serve any startup well. People get grumpy and start to find ways to slack off; performance goes down, so does company morale. An exhausted engineer will forget to update the codes; a tired QA person will not verify the last round of fixes. An overworked producer or account manager will start to respond less often to clients, which results in client frustration, miscommunication, etc. Your colleagues and employees are your best resources; treat them well they’re more likely to contribute more productively.
In sum, three take-aways:
- Know your bandwidth. Don’t promise what you cannot deliver.
- Manage client expectations.
- Take care of your best resources: your team.
© 2013-2015 My-Tien Vo