Once upon a time, businesses followed a ‘growth at all costs’ strategy. If an idea had the potential to boost growth, why not try it? In modern times, we are aware of the risks involved.

Growth, especially rapid growth, poses significant risks to organizations. They may struggle to scale in all areas to meet their growth needs. Customer service and company culture will suffer as a result.

However, with the right approach, companies can achieve growth and reach their profitability and sustainability goals.

What are the Risks of Rapid Growth?

Strain on Talent

Companies that grow rapidly may not have the necessary human resources to keep pace. Over-relying on the talent they have can result in stressed-out teams, with some employees leaving the company at a time when they’re needed most. If assigned too many tasks, they may struggle to focus, resulting in diminished customer service, careless work, and increased errors.

Many organizations try to hire quickly to ensure they have teams that can handle the extra workload. However, these hires are often made carelessly, and teams may not have the ability for proper onboarding and training. As a result, new workers create subpar output.

Overstretched Resources and Equipment

Organizations must also keep pace with growth by ordering additional inventory and equipment, as well as adopting new systems. However, hasty decision-making can do more harm than good.

Adopting new equipment and technology increases the need for training, which can be difficult for an over-taxed team. Additionally, organizations may order equipment and technology that isn’t right for their companies, leading to a waste of time and money.

Companies experiencing rapid growth also need to order inventory to fulfill order demand. If they are unable to access the inventory they need quickly, they may disappoint customers and lose orders.

Poor Quality and Customer Service

Companies that lack the resources to keep pace with rapid growth often produce subpar products and services, which fail to satisfy customers. They may find themselves losing clients and failing to achieve long-term growth.

Additionally, many organizations that grow rapidly often find themselves stepping away from their company’s culture and values. They are unable to focus on what made their company great, and their organization becomes unrecognizable. This loss further alienates customers and employees.

How to Reduce Risk and Achieve Growth

• Create a Scalable Infrastructure: Companies with a scalable infrastructure will experience seamless growth. They must identify technology that will automatically scale to the company’s needs. Organizations should also hire individuals who will help maintain consistent quality.
• Develop a Resilient Culture: A resilient team will easily adjust to changes in the workplace. Despite what some may think, resilience is not about adopting a ‘get-tough’ attitude. Instead, companies that demonstrate a commitment to prioritizing their employees’ well-being will achieve resilience in the face of change.
• Integrate Risk Assessment and Risk Management: Organizations should carefully consider their approach before embarking on a growth initiative. They must use data to identify all risks involved and ensure the risks are worth the investment. Teams should also develop plans for risk management and mitigation to achieve their goals successfully.
• Keep Values at the Forefront: Companies should be aware that growth can make them lose sight of what matters most. They should intentionally remind themselves of their company values, even if it means writing them on a whiteboard or reciting them verbally each day. Doing so ensures they maintain a high level of service without alienating their client base.
• Collect Feedback: Growth often requires an adjustment to new systems and processes, and leaders must check in with teams and customers to ensure a smooth transition. They should actively solicit feedback through surveys and an open-door policy. If issues are detected, they should be addressed immediately.
• Set Up Dedicated Teams: As a company grows, it often undergoes numerous changes. Consider establishing dedicated teams to ensure processes run smoothly for both customers and employees.
• If Necessary, Say No: It can be tempting to accept any process that potentially leads to growth, but companies should weigh the pros and cons carefully before adopting new systems and strategies. If a project does not align with your company’s culture and long-term growth, don’t be afraid to say no.

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