Business growth and development stage assessment
Assessing growth and development stage
Innotec Group is a major SME company where I am likely to work after graduation as a part of the larger management team in one of its departments. The assessment of the current stage of Innotec Group growth and development is important since it helps in diagnosing, predicting and providing solutions for the challenges facing the firm through learning of several major concepts. These concepts are important in improving the understanding of both external and internal environment in which the business is operating. Recognizing the current stage of growth and development will also make it possible for one to adapt their leadership skills to what is required while facing various challenges that await any successful business. Examination of the growth patterns and challenges facing the firm will be important in assessing the very stage of the business. This includes an evaluation on problems related to obtaining customers and delivery of desired products to the customers (Judge & Business Expert Press, 2011). The issues to be considered includes whether the firm is able to obtain customers, provide services or deliver its products effectively as a viable business. If Innotec Group is in the first stage, existence stage, it will encounter challenges while trying to expand from a pilot process of production or a few customers to a large base of its intended sales. In this stage the business will also experience insufficient money for covering considerable cash flow demanded in a start-up stage. In addition, at this stage, the firm has simple structures and operations with the owners doing most of the responsibilities, while directly supervising the employees (Churchill & Lewis, 1983). At this stage the, there is no much customer acceptance and due to limitation on start-up capital, there is possibility of the business being sold or closing down altogether. The presence of these issues indicates that the business is in the startup-stage with so many gaps relating to capital, customer base and strained management input.
If the firm has enough customer base that is able to satisfy them fully with its services or products, this implies that the business is the second survival stage. At this stage, the main problem would be the link between the firm’s revenues and expenses incurred. If the business is able to break-even in the short-un and covers basic costs such as replacement or repairs of assets and can generate sufficient cash flow in stay afloat in the business and financing growth to a sufficiently big size, it means that the business is in the second stage of growth and development (Churchill & Lewis, 1983). The organization operations and sales involve a small workforce at this stage, while there is minimal systems development and planning is formal and cash forecasting. If a company is in this stage, there will be indication of growth in profitability and even size and its economic viability will have been developed enough to warrant a possible sale to another party. The gag existing in such a firm includes lack of constant profitability or growth, little development in operations and structure while the management is does not make key decisions independently. If the firm is profitable and stable, it should be in the stage three where success is being experienced. An assessment on profitability would indicate the potential for expansion or continuous growth and development since the customer base is strong and demand is met sufficiently. A firm in this stage will be facing the issue of whether to expand or maintain its stability, with expansion plans being to start-up new branches while maintaining the status quo of the business (Cornwal, Vang & Hartman, 2012).
An evaluation that indicates that the firm has attained its economic health with sufficient customer base, large size and high market penetration shows that the firm is in stage four. An assessment on the length the firm has experienced economic success would indicate the stage of the firm, with a long-period of such success shows a stage three (Churchill & Lewis, 1983). An assessment of the risks being taken by the firm would also indicate the stage of the firm, with huge risks in investment shows the stage three when expansion is at a notch high. If the key challenges being experienced in the business relate to how rapid growth will be carried out or financed, it means that the firm is in stage four. In such a scenario, the delegation of responsibilities is done for effective managerial improvement and the systems and structures are largely developed. An important issue in this stage is whether there is enough cash flow to sustain growth demands and the managerial and financial challenges that comes large firms that are constantly growing. The financial controls and gains in a firm can be assessed to determine the stage of growth and development with consolidated financial systems indicating a concern for rapid growth, characteristics of stage five where resource maturity has been attained.
From the various growth stages that a firm could be operating at, there may exist gaps on market penetration, inefficient capital for start-up or expansion and lack of efficient management especially growth management and financial controls. To assist in eliminating the capital gap would require raising the necessary funds which will be instrumental in enabling the bridging all the other gaps. Raising of the necessary capital include looking for financial partners willing to lend the operations of the firm whether in production process, marketing and even expansion process. Raising funds would involve engaging venture capitals, borrowing from lenders such as banks and selling of the company shares to the public depending on the growth and development strategy of the organization (Cornwal, Vang & Hartman, 2012). Where the firm is experiencing challenges or gaps in customer base especially in the first stage of growth, a strategy would be to have embrace customer centricity. When the firm is experiencing challenges in obtaining good customer response, delivering on value which addresses the requirements and needs of customers can assist in solving the issue. Companies have to be customer centered while making considerable efforts in constantly tracking and understanding consumer dynamics so as to attract them in the right approach. This will be enabled by relevant solutions to the needs through valuable products. Where the firm is experiencing gaps in management , organization structure should be that the manager makes decisions after consulting widely from others , whether internal employees or consultants , so as to having good management couching and mentorship (Churchill & Lewis, 1983). This will be necessary regardless of the stage of the development the firm has reached. To enhance effectiveness and efficiency in business growth and expansion would involve overcoming not only financial gaps but also human resources needed to offer expertise on the various fields such as finance. This would be necessary in stage 3 and 4 where the firm is experiencing stability in growth and profitability and expansion is needed. The management gap would be overcome though implementation of various training and couching programs whose aim to equip the staff with relevant entrepreneurial and management skills required in the firm. The development of effective leadership across any stage of the business would help in implementation of strategies aimed at solving the experience and capital gap.
The management of the firm can employ metrics and processes that are directed towards growth and expansion so as to avoid remaining in the same development stage. I would, therefore, introduce simple, well-designed and straight forward process assisted by effective team management and management practices. For any enterprise, management team is very important especially where is based on competitiveness of the company in the market. With such a team, high-quality products that can efficiently meet the market demand are quite possible to produce and this will go a long way in attracting a large customer base for the first stage firm. In entrepreneurship, effective management plays a vital role in solid decision-making, alignment of various cross-functional responsibilities and proactive adoption of risk measurements to prevent the failure of a new business (Wilson & Bates, 2003). In addition, having strong management in the business will ensure that any talent-gap existing will be filled. Hence, the various challenges faced by a business involve debt gap, talent gap and leadership gap whose solutions would see a large improvement in the growth and development of the firm. Dealing with these gaps especially the debt gap means that an entrepreneur is not afraid to take various risks which will ensure growth and profitability of the venture. The goal will be that all efforts in the business will be aimed at accepting change that address these gaps and matching risks taken to final rewards.
Assessment of leadership potential
An assessment on my leadership potential can be based on behaviors that drive results and the others that help in building relationships. The behavior can be traced to the cognitive ability in relation to analyzing a situation, recognizing strengths and weakness in such a situation and coming up with workable solutions to the weaknesses or challenges identified in the analysis. The ability to analyze the available information and finding out various challenges facing an organization, the strengths in the firm which can be used to solve the situation and influencing others to adopt changes (Daft, & Lane, 2008). Another aspect in assessing leadership potential is my personal divers which comprises of values, preferences and motivations that influence the decisions that I make and actions that I take for that matter. These drivers provide a willingness to take risks an engage in various tasks which require investing a lot of energy, time and resources for future rewards. Motivating others is a basic aspect in leadership function which determines how the working environment will be and whether the set goals and objects will be achieved both in the short-run and in the long-run (Daft, & Lane, 2008). To assess my leadership potential can also involve identifying ideas, beliefs, past experiences, skills and competences that I have applied in previous decision making. These can be summed up as personal attributes which are measured through competencies like problem solving, decision making, developing others and one’s flexibility. In addition, the views of others can be used to assess my leadership potential based on my past performances both inside and outside the working environment.
In regard to these measures, my strength in carrying out thorough analysis when confronted by a situations that require clear and quick decision making , which is enough evidence that my leadership potential is quite high. My knowledge past experience in leading informal groups, couple with the ability to motivate and influence others is good indications that I have good leadership skills. In addition to influencing and motivating others, I have also portrayed the ability to develop others through offering direction on personal choices that may lead to career development and failure after a wide searching. These strengths portray aspects that I can use in overcoming weaknesses that can derail my leadership skills. Moreover, my behavior when faced with various situations has been described by others as being calm, flexible and dependable. Improvement on leadership potential can play a key role in personal and career growth and development and overcoming weaknesses through strengths assessments (Daft, & Lane, 2008). The leadership potential can be enhanced through taking initiatives, working outside my profession or position, listening effectively and conflict management (Daft, & Lane, 2008). Taking initiatives means taking on more responsibilities as a leader which involve extra projects outside roles description since the more work I undertake the more I continue learning and improving. This also relate to working outside my roles which means extending help to other situations that may need quick and effective decision making . This helps in broadening the level of leadership skills and competencies that are necessary in business management an integral part in the success of any enterprise. Listening effectively is an important aspect that allows obtaining feedback and building good relationship in team work on any given projects’ undertaking. Conflict management is a very important factor in effective leadership especially when working as the leader of a group in an organization. It involves knowing how to deal with difficult people in such a group and resolving any arising conflict (Daft, & Lane, 2008). Mentorship and couching are important programs that can help in improving leadership potential since it involves learning from more experienced leadership in the long-run or short-run. Couching and mentorship provide an opportunity for one to learning from others experience, ask for guidance and assistance in important projects and this allows new skills development.
Initiating change
Initiating change in a cross-cultural team involve breaking the barriers that may arise from different organizational cultures of different departments or sections. As a leader, finding a way to eliminate the barriers or minimizes the effects of such barriers in change acceptance among the different members. There is therefore a need to achieve collaboration across the team members which can be achieved through aligning the interactions of members to a common objective. Coordinating the interactions between the team members will help in breaking communication barrier and tension that may exist, and this makes it possible to introduce change with minimum resistance (Judge & Business Expert Press, 2011). As a leader, initiating change easily will involve describing and explaining to the people why changes are needed, the need for every member to be involved in implementation of these changes and providing support the members to deal with effects of such changes. To achieve change acceptance across the team, building powerful coalition will make it possible for the members to own the change and consolidate their efforts towards achieving a common vision.
Reference
Wilson, P., & Bates, S. (2003). The essential guide to managing small business growth. Chichester: Wiley.217-220
Cornwall, J. R., Vang, D. O., & Hartman, J. M. (2012). Entrepreneurial financial management: an applied approach. ME Sharpe. 22-25
Churchill, N. C., & Lewis, V. L. (1983). The five stages of small business growth. Harvard business review, 61(3), 30-50.
Judge, W. Q., & Business Expert Press. (2011). Building organizational capacity for change: The strategic leader's new mandate. New York, N.Y.] (222 East 46th Street, New York, NY 10017: Business Expert Press.
Daft, R. L., & Lane, P. G. (2008). The leadership experience. Mason, OH: Thomson/South-Western.
