If you search the internet for inspirational quotes [and hey, we’ve all been there, wine-in-hand at the end of a long week, begging the internet to deliver some nicely formatted platitudes to spur us on for the week ahead], then you’ll likely be met with many variations of throwing caution to the wind, diving in head-first, feeling the fear and doing it anyway! Maybe I’m looking in the wrong places, but I personally haven’t come across anything along the lines of “feel the fear, sit in it for a week, make a spreadsheet and map out the various financial implications of every scenario and then… if you’re confident it won’t end in financial ruin then maybe do it in a series of well-considered stages”. Less catchy, I guess.
While the term scaredy-cat may be tongue-in-cheek, I will put my hand up to being a little cautious when it comes to big company decisions, especially growth. Part of this, admittedly, is that I am the custodian of somebody else’s business, but really it just comes with the territory. I can’t imagine not crossing all those t’s and dotting the hell out of those i’s, when dozens of people’s pay-checks depend on the success of my decisions.
Don’t get me wrong, I am in no way spurning the idea of acting courageously in business. The Digital Picnic is largely built on brave, big and sometimes risky decisions, and our fearless founder Cherie is an inspiring real-life example of trusting your gut and taking the leap. Preparedness and courage don’t have to be mutually exclusive, though, and they certainly aren’t at TDP. While I admit that as a company we’re still fans of the odd blind-leap, as we have grown we’ve put a lot of processes in place that allow us to still make those big, brave decisions, but from a place that assures the more risk averse amongst us [*waves*].
So, want to scale your business but not quite feeling inspirational-quote-levels of brave just yet? Here are my top tips for heading into the unknown [but maybe with a map, compass, a week’s worth of water, a torch and some nutritionally balanced snacks in hand]…
It’s never too early to start defining your culture.
So you just started your ecomm store side-hustle, and most days it’s just you and your dog, unless your mum pops in to help you pack orders? While a full company handbook and organisational chart may be overkill, you can still start laying the foundations for when you do eventually have a team. Start thinking about, and recording, your values. These can evolve over time, sure, but they can also be used to inform the sort of company that you build. If you make your very first hire with your values in mind, then this sets the tone for the culture you want to cultivate. Rapid growth creeps up on you, and take it from us, it is much harder to retroactively change a culture than it is to approach growth with culture in mind.
Understand your motivation for growth.
If you feel like you’re ready to make your next hire, make sure you know where that feeling is coming from. Is it the result of late night desperation, because things are happening too quickly and your workload has got the best of you? While this can absolutely be a contributing factor to the hiring process, it shouldn’t be the only one. In my experience, these thirsty hires [much like a lot of the decisions we make from a place of burnout] almost never pan out well. It’s also always worth examining your internal workload distribution and processes before you go straight to bringing in an extra body. Could you be more efficient with your current work? Could a casual external contractor be a better solution? And most importantly, will the new hire not only relieve pressure from you/the team but will they also bring in more revenue or create other opportunities for growth? This brings me to the next tip…
MAP IT OUT.
Sorry to yell. But really. Map. It. Out. Please! Regardless of the size of your operation, make sure you understand not just the obvious financial implications of hiring [wages, super, etc.] but how it affects your overall operational costs, and how much you need that person to be bringing in, to make it a worthwhile investment. Let me leave no doubt that I am not an accountant [or even anything resembling such a creature] but I do know when to take counsel from one. As we don’t have a CFO [or any accounting expertise at all in our leadership team] we outsource this aspect of the business to Fi [of Peach BM] and we’re sure to consult her before making any big hiring moves. Fi helped us to understand that for an employee doing billable work, we should be expecting them to bring in roughly 2.5x their annual salary. Armed with this info, we get deep into spreadsheet land [the happiest of places, for me!] to set financial KPIs to support the new role. We have a great handle on profitability and productivity, so we already have the frameworks to measure this stuff. I bet you can guess what my next point is?
Spreadsheets are your friend.
That sentence will have either made you audibly shudder, or nod maniacally. Spreadsheets are the great divider [or multiplier, it depends on the formula. Sorry, even I rolled my eyes at that] and you either love them or hate them. Even if getting deep into Excel or Sheets is your own personal hell, Future You will thank you for keeping even the most basic grasp on output vs income. Of course how you do this and what question you’re answering will really depend on what your business is, but the more historical data you have when it comes to big decisions, the better. From an agency perspective, measuring profitability of client work is the most essential, but in addition to tracking our time and profit on client work, we also break down each area of the business to compare percentage of revenue to percentage of time/resources allocated to it. Having this kind of information allows you to really understand how each revenue stream is performing, and where to focus your efforts of growth. I could go on about this all day, but I’d rather you stayed awake. In a nutshell: If in doubt, chuck it in a spreadsheet!
So, you’ve sent so long in Google Sheets that you see the world in grids. You’ve designed, laminated and framed your values. You’ve prepared for every financial eventuality, and still, you’re balking at making that job ad live or expanding your service offering. So don’t do it. There is no amount of preparation that can negate your own instincts, and this goes both ways. Sure, being equipped for growth on a practical level goes a long way, but that final stretch is down to mindset. And anyway, whatever you decide, the internet probably has an italicised platitude to back you up.