4 common growth pains for SME
Growth is an exciting prospect for SMEs, but owners should be aware that pain can also be part and parcel of gain.
That pain can take many forms depending on the business and the market it operates within. However, four areas present similar challenges in times of growth for most small businesses:
Each of these has security implications that most small business are unaware of, or don’t prioritize as part of the scaling up plans. That includes challenges around team growth and office expansion or moving into new premises - which both require advancements in security. If unaddressed, these challenges can prove to be painful further down the line, but forward-planning with security in mind helps to avoid that.
Growth pain 1: Financial pressure
Scaling up is an exciting stage of small business life, but can put cash flow at risk or require taking on loans as a result. For example, growth may create financial pressure on small business who need to scale up operations, due to the need to increase production capacity or buy more stock to respond to growing demands. Additional costs linked to finding additional storage space for it, or onboarding new team members are other typical financial constraints brought about by times of growth. Sound planning and forecasting is crucial at this stage, to avoid crippling financial commitments or ensure growth-critical cash flow is kept positive.
Growth pain 2: Implementing processes
As SMEs scale, managing tasks and operations can become more complex and difficult. This creates a need for building robust processes to implement structure and ensure critical business activities continue to get done at a consistent quality level. Striking the right balance when implementing processes is always challenges, as too many processes, or processes that are too complex, can impact productivity negatively. The key is to identify which functions are most critical for business growth and sustainability, and lack structure, then prioritize and build around those. For example customer service and accounts receivables.
Growth pain 3: Changing staffing levels and patterns
When SMEs grow, they typically also need to expand their workforce, so they have sufficient personnel to manage additional business volumes and customer commitments. Examples include salespeople to bring in more business, and account managers to manage customer relationships, but also operational staff to ensure customer order fulfillment and service levels scale up too. There could also be a need for a different mix of staff within teams, adding contractors for example, and to change operating hours from a typical day to perhaps incorporate weekend overtime or even shift work to cope with the increase in business. This means SMEs need to implement proper measures to control access to the premises and within, and reduce risks of malicious activities.
Growth pain 4: The need for more space
An increase in members of staff creates a natural requirement for more office space to accommodate them all. Similarly, business growth may create a need for more inventory or production space. This means expanding an existing office or workshop, or if that is not sufficient, moving into new premises. That said, many small businesses are now looking at adding to their existing office space via co-working (or co-making space), rather than moving the entire team to new premises. These spaces offer many advantages to fledgling businesses, not least access to fully serviced spaces at a more affordable cost than traditional commercial spaces. SMEs need to be mindful that bigger spaces mean more opportunities for intruders. And moving part of the workforce to a shared working space can mean having to mix different sets of security policies and systems, as well and risks, including that of social engineering.
Read our Three forward-planning tips to avoid security-related growth pains: