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10 Tips For Scaling Up: Are You Already Doing These?

by Verne Harnish

9 minute read

    Note: This is a short summary of Verne’s talk at Scaling Up User Workshop in Mexico City, September 2017. You can see the slides from his talk at the end of this article.

    In 2013, Infusionsoft, an Arizona-based provider of customer relationship management software, secured $54 million in growth capital from Goldman Sachs. The year before they grew 53% with a $50 million run rate and they plan to grow to $200 million and 100,000 small business customers in the coming years.

    Infusionsoft is what I refer to as a Gazelle.

    The Rockefeller Habits and its tools are discussed on a weekly basis among our leadership team. Your work has made a big impact on our company,” Clate Mask, CEO of Infusionsoft.

    I’ve spent over 30 years helping more than 40,000 business leaders like Mask scale up their ventures. My team and I focus on helping cities and countries create scaleup eco-systems to support the already robust startup eco-systems that exist.

    Here’s what I know:
    1. CEOs and executives of growth firms want ideas and tools they can implement immediately to improve some aspect of their business.
    2. Ideally they’d like to enjoy the ride along the way!

    The Gazelle In A Startup World

    Because of the huge number of startups and small businesses, understandably there is a lot of attention and support available to help those who wish to open their own business. However, the companies that generate the most growth for the country, provide a good number of jobs and development, are the high impact firms, or the Gazelles.

    “High-impact firms are relatively old, rare and contribute to the majority of overall economic growth. On average, they are 25 years old, they represent between 2 and 3 percent of all firms, and they account for almost all of the private sector employment and revenue growth in the economy.

    — High-Impact Firms: Gazelles Revisited

    Two such Gazelles that are having that type of impact today are Apple and Starbucks. In 2001, when Apple released the iPod on its 25th anniversary, they had only 9,600 employees. All the phenomenal growth of Apple in revenue and employment (80,000 in 2013) occurred after this historic milestone.

    When Starbucks celebrated its 25th anniversary, it had 1,000 stores and was just beginning to venture outside the US. Since then, it has rocketed to more than 18,000 stores in 62 countries and more than 150,000 employees.

    Basically, what I’m trying to say is, if you’ve been in business less than 25 years, you still have time to make it big; if it has been more than 25 years, and you’ve not scaled up, it’s never too late!

    I gave a an in depth introductory talk into scaling up in Mexico City last week and thought I’d share with you what I shared with the over 400 people who attended our seminar. Here are 10 tips for scaling up:


    1. Get Educated

    Leaders are readers. Great leaders know one thing — having a natural curiosity and thirst for learning separates the good from the great.

    I’m not going to lie, scaling up will shake things up at your company. You must be able to handle whatever is thrown at you. And for that to happen, you must have the expertise that comes with knowledge and experience, to handle it.

    Follow the lead of successful leaders:
    • Larry Page, CEO of Google:
      When asked how he learned to run a company, he responded “I read a lot.” For instance, he read three books on how to name things.
    • Mark Cuban, Owner of Dallas Mavericks:
      Reads 3 hours per day. His goal is to find just one idea he can use to give him and the over 150 companies in which he’s invested an edge in the marketplace.
    • Warren Buffett:
      His first priority was to reserve quiet time for reading and thinking, particularly that which might advance his learning, no matter how old he got.
    • Mark Zuckerberg:
      His personal development priority in 2015 was reading a book every two weeks.
    • Bill Gates:
      For decades, maintained his famous “Think Week”, devouring a record 112 books/articles/whitepapers during one session.

    2. Understand Your Niche And Its Competitive Advantage

    A key to growth is understanding the niche in which you belong. Your business needs to have a deep understanding of what your competitive advantage is over your competitors (and vice versa).

    You want to dominate your niche! You do this by setting a #1 Priority. Think Facebook, and Mark Zuckerberg’s almost maniacal priority to figure out a wireless strategy. Think Apple, and Steve Jobs decision to focus on just producing two desktops and two laptops.

    So what is your niche you’d like to dominate?


    3. Know When To Say NO

    In the early stages, in it common for companies to say “yes” to everything — even things they aren’t sure they will be able to deliver. But here’s the thing, in order to scale up, you need to concentrate on winning in your niche, which means at some point, rejecting everything that isn’t moving you towards that goal.

    So yes, while in the beginning you might need to say “yes” to everything, but say “yes” until you have the luxury to say “no”.

    You know you’re there when you start saying “no” to the increasing number of opportunities coming your way (that moves you away from your goals); “no” to the wrong customers for your business model; “no” to 19 of the 20 people wanting to work with you; etc.


    4. Get Your Strategy Right

    A good strategy is crucial for growth. It generates sustainable top-line revenue growth, creates raving fans of your product/service, gets your whole team on the same page (with a One Page Vision Summary or OPVS), grows as you grow, and yes, takes a whole lot of constant work. This step isn’t easy, but it is worth it.

    In fact, a good indicator that your strategy is on point, is when you start saying “No” more than you are saying “Yes” (point #3). With the help of the team you’ve assembled (The Council), you can work on your short, medium and long-term goals (as well as a Big, Hairy, Audacious Goal) that will help your business scale.


    5. Attract And Keep The Right Talents

    Senior leaders know they have succeeded in building an organization that can scale — and is fun to run — when they aren’t necessarily the smartest people in the room! Attracting and hiring the right people is as critical as landing the right customer. These people will make or break your organization.

    And I don’t mean just the senior team — every person in your company should be hired so they fit in with your strategy and culture. Every single person is valuable. So spend some time developing a strategy to attract and keep the right people.

    City Bin Co. And Attracting The Right People

    10 tips to scale upThough his business was recognized as one of the Best Managed Companies in Ireland, Gene Browne from City Bin Co. still couldn’t easily attract and hold on to employees to sling garbage cans. It’s a dirty and physically demanding job requiring an early start in the morning.

    Browne needed to get creative in attracting the right people to work on the back of his garbage trucks since the people working on the back of the trucks are the ones who can make or break a service experience.

    When a young man named Gary Manogue applied for a back-of-the-truck job because, (a) he saw it as a chance to do part of his daily workout while also being paid and (b) the early start and finish times suited his lifestyle, Browne saw this as his opportunity.

    Gary was a competitive kickboxer and had ambitions to win a world title fight. He needed to train as many hours a day as possible. In December 2013, Gary became the world super welterweight kickboxing champion. In a pre-fight interview, the Galway Advertiser noted:

    “This is Manogue’s first seven-round fight and he has prepared with a fitness regime that involves an eight-kilometre run every morning, workout in the gym in the evening, and in between working for The City Bin Co. ‘Running after bins keeps me pretty fit too,’ he says.”

    The City Bin Co. has since developed a hiring campaign aimed at unemployed young men who are big into fitness, asking, “Would you like to be paid for your daily workout?” These young men do not perceive the job in the same way as the typical young person who is handing out CVs looking for a job.

    6. Learn How To Manage Your Team

    “The bottleneck is always at the top of the bottle,” — Peter Drucker

    Great leaders are excellent delegators. You can’t (and won’t be able) to do everything by yourself. As your company scales up, the toughest decisions involve people and their changing roles in the organization, especially within the leadership team.

    Invest time and effort in learning to manage your team effectively, so you’re not getting involved in tasks that should be taken care of by others.

    Here are five activities of successful managers:
    1. Help people play to their strengths.
    2. Don’t demotivate; start “dehassling.”
    3. Set clear expectations, and give employees a clear line of sight.
    4. Give recognition, and show appreciation.
    5. Hire fewer people, but pay them more.

    7. Think Outside Investor Money

    While investor money sounds great, you should also look at ways to obtain funds outside of the investor circles. With platforms such as Kickstarter and Indiegogo, there are now other ways to test your concept to see if it is viable as well as to raise money that don’t involve investors. For more ideas on how to obtain funds outside of investor money, I recommend reading The Customer-Funded Business: Start, Finance, or Grow Your Company with Your Customers' Cash by John Mullins, Associate Professor at the London Business School and also a good friend of mine.


    8. Be Wary Of The Word “Innovation”

    Innovation has become a keyword in most companies. But I’d ask you to take a step back and instead, focus on refining the product you already have. This isn’t to say, never launch anything new, but in our rush to innovate, we might leave a half baked product on the line.


    9. Business Opportunities Are Everywhere

    Don’t let trends give you tunnel vision because business opportunities are everywhere. It might seem in recent years, with the birth of countless technology companies, that this sector is the only way to success, but this is untrue.

    Kimbal Musk, younger brother of Elon Musk decided to enter the food business and is currently making huge waves in changing the way we see, produce, and eat food in the United States and around the world.

    It’s best to keep your eye open for opportunity, than to just follow what is currently trendy.


    10. Gain Experience Before You Begin

    Finally, we come to my last point, which coincides with my first point — and that is, do the work.

    Let me explain. In point #1 I assert that education should always be the top most priority for any leader. In my final point, I’d like to add, “gain experience” to that list. So in essence, education plus experience will make one fine leader.

    There is no other way to gain experience than to do the work. This will help you understand how things work, see what others are experiencing, and how to manage the progress in your company.

    Check out the slides from my talk here:


    With these tips and tools in place, you’ll soon be well on your way to scaling up your business!

    Don’t forget to check out my 10 Rockefeller Habits Checklist that goes into more detail in how to scale up your company. When you’re done with that, don’t forget to download the One Page Vision Summary (OPVS) to get your strategy in place.

    Are you already practicing any of the tips I mentioned above? Leave a comment below and let us know!

    Go Further with the Complete
    Scaling Up Frameworks

    EBOOK Scaling Up Book EssentialsImplementing these 10 tips is just one aspect of what your business needs to scale up. To take your business even further, you’ll need to pair it with other essential scaling up frameworks.

    Verne Harnish’s ebook, “Scaling Up Your Business: The Essentials”, gives you a quick overview of the all the groundwork you need to lay down in order to scale. The ebook will give you additional guidance on the four key decisions to scale up your company, the 7 strata of strategy, plus answers to all the frequently asked questions about scaling up.

    Download your free ebook here so you can leverage the scalability of your business for maximum benefit.

    Verne Harnish

    Verne Harnish

    Verne Harnish is founder of the world-renowned Entrepreneurs' Organization (EO) and chaired for fifteen years EO's premiere CEO program, the "Birthing of Giants" and WEO's "Advanced Business" executive program both held at MIT.

    Founder and CEO of Gazelles, a global executive education and coaching company with over 150 coaching partners on six continents, Verne has spent the past three decades helping companies scale-up.

    The "Growth Guy" syndicated columnist, he's also the Venture columnist for FORTUNE magazine. He’s the author of Scaling Up (Rockefeller Habits 2.0); Mastering the Rockefeller Habits; and along with the editors of Fortune, authored "The Greatest Business Decisions of All Times", for which Jim Collins wrote the foreword.

    Verne also chairs FORTUNE Magazine's annual Leadership and Growth Summits and serves on several boards including chairman of The Riordan Clinic and the newly launched Geoversity.

    Nombrado por la revista FORTUNE Small Business como uno de los “Top 10 Minds in Small Business”, empresario, autor y columnista de la revista FORTUNE, Verne Harnish, es un consultor de gestión muy buscado, especializada en liderazgo, planificación estratégica y el crecimiento del negocio. Su libro, “Dominando los Hábitos de Rockefeller: qué debe hacer para acrecentar el valor de su empresa en rápido crecimiento” ha sido traducido al español, chino, japonés y coreano. Verne es también el fundador de EO, la Organización de Empresarios (http://www.eonetwork.org), y el CEO de Gazelles Inc.

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