This article was originally published in the online edition of Forbes in the CommunityVoice section.
What’s the one thing you could do to ensure your company is sustainable? The answer is to create a growth engine for your business, of course. Many organizations neglect to invest in creating a predictable and measurable strategy to accelerate and manage growth. Six key areas can help companies sustain a growth engine.
1. Budget For Growth
If you intend to replicate your annual investment in marketing and sales but are forecasting additional growth, your plan is probably unrealistic. According to the February 2017 CMO Survey, marketing spend is typically 7.5% of a company's overall budget. To grow at a rate above the market standard or disrupt your current plan by entering a new market or launching a product, you should be prepared to spend more. Additionally, if you intend to increase sales volume but still operate with the same size service team, you may not be set up to handle growth successfully. Increased sales and marketing activity is not the only consideration. As a company's revenue scales, we witness growth pitfalls like lack of lead follow-up, operational or system failures, and the right amount of available growth capital. Establishing a financial model that projects revenue growth alongside staff planning and a recruiting strategy is critical to realistically managing growth goals.
2. Identify Your Niche
Trying to be all things to all markets dilutes your offering. Determine what your business does best and build your market focus around that strength. Begin collecting data on what makes your company and customers succeed. Think about your best client relationships and where you are doing exceptional work. Document these achievements to help clarify the right market, service or product offering, while answering:
- What does your business do exceptionally well?
- How are you different and better than competitors in your space?
- What are the challenges your customers face?
- Why is your product or service the best option to solve those pain points?
- What success stories can you tell?
- Which data or key performance metrics (KPIs) back up your success story?
Getting clear on your sweet spot or niche market position will help you identify the types of customers who will value your offering.
3. Think Small
You are clear on your market position and market target. Now it is time to build a list that should focus on prospective organizations that have similar characteristics to your most profitable existing clients. This list is where your sales team should focus their high-touch efforts. LinkedIn, InfoUSA, industry associations, Google and an array of online tools are resources to utilize when researching company information, contact names and emails. When building your list, ask:
- What is your ideal customer size?
- What are the decision makers' titles?
- What size list can your team personally contact in a month?
- Are there any conflicts of interest to consider with current clients?
- What technology(s) will you use to maintain and communicate with prospects?
Once you have a list, your marketing and sales strategy should focus on a campaign that gets you in front of those accounts with a meaningful story to tell. Creating a list and a marketing campaign can be much more impactful with the aid of a CRM. Tracking and regularly sharing insights across your sales and marketing team will improve your approach and identify gaps in your sales process and marketing efforts.
4. Think Bigger
Create brand awareness in market groups or industries that extend your reach beyond those targeted accounts. Casting a wider net is perfect for building your pipeline. Campaign tactics can include participation in industry events and associations, publishing articles, or developing a lead generation campaign with relevant content that interests your target audience. Ask:
- What are the industry pain points?
- What products or services can you provide to address your audiences’ pain points?
- What are the buying triggers?
- What information will aid in informing a purchase decision?
- Which associations, publications and social media channels influence your prospects?
- Which tools and technology(s) will you use to vet and track opportunities?
Do not discount the need for brand awareness as part of your growth strategy. You will never have the chance to be considered as a buying option if your business is not known or credible to your target market.
5. Look Inside
You now have a plan to grow sales but once an order is placed or a contract is signed, you have to deliver. Many organizations fail on the delivery side of growth – typically called growing pains. We believe you need to nurture a talent pipeline just as you would your sales pipeline. Hiring to support growth can be challenging but you can diminish stress if you plan. Maintain open job postings and ongoing recruiting efforts to find qualified applicants. Ask yourself:
- Which the roles are most critical to your business?
- What are the salary ranges in your market?
- Do you have HR technology to manage the recruiting process?
- Does your brand look inviting and exciting to potential applicants?
Making a bad hire is costly to company morale and your bottom line.
6. Make It Predictable And Measurable
Growth can be measurable and predictable when you forecast and track. Build a budget that includes sales projections, cost of goods sold (COGS), fixed expenses, and new staff plan projections. Establish benchmarks by planning and asking questions.
- How much do you want to grow sales (annually)?
- What is your typical deal value?
- How many inquiries become proposals or quotes?
- How many of those quotes turned into sales?
- How long is your sales cycle?
- What is your close percentage?
- How much additional staff will you need to deliver on new sales?
- Which roles will you need?
- What is the salary range for your market?
- When will your new hire(s) need to start?
Answering these questions will help you set realistic benchmarks and formulate the success of your growth plan. Forecast your sales and expenses. For most businesses, forecasting billings and expenditures at the beginning of each month and reviewing the prior month will be the right cadence to monitor progress. Knowledge is power in creating a growth engine. You may not always get it exactly right, but by tracking and measuring, you will be surprised how often you do.