What Makes A Company Scalable?

Bigger isn’t always better.

And I’m still talking about business here 😛

I’m noticing a lot of content and focus on scaling these days. All these marketing, sales, and growth experts promoting “how to scale” and “more”.

While there’s nothing wrong with scaling and desiring more… I want to talk about the more important thing most of these growth experts aren’t talking about:

Scalability.

In this newsletter, I want to talk about:

• What makes your company scalable

• When you should focus on scaling

• Why you shouldn’t scale if your business is not yet scaleable

• What you should focus on instead to make it scaleable

Let’s put the “how to scale” stuff aside for a moment and let’s look at the “how to build a scalable business”.

What does it mean to scale?

Let’s start with the definition of scale.

Most people think scaling means “more growth”. It’s what you’re taught by marketing, sales, and growth experts.

Now if you ask entrepreneurs who have scaled real businesses and business operators who run scaled teams and companies, they’ll tell you that:

Scaling is more than just growth, it’s adapting to the increased demand, pressure, and resistance from surpassing your total addressable market (TAM).

Having a scalable business means having the potential and adaptability to evolve beyond this disruption of homeostasis while maintaining its brand, reputation and integrity.

Ineffective scaling is increasing revenue and profits in a way that violates the safety and fulfillment of your business, your team, your clients, and ultimately yourself.

This is where most people go wrong with scaling because they don’t truly understand what scalability is.

For them, and possibly for you right now:

More growth = more problems

Bigger here isn’t better.

Is your company scalable?

There are 3 things you need for your company to be scalable (in a good way):

• Predictability

• Self-managing team

• Enjoyability

If you don’t have these 3 things yet, you may want to reconsider scaling your business.

Predictability

Your company’s ability to consistently and sustainably grow and operate through various seasons.

• How predictably can your business get and retain attention?

• How predictably can your business get leads?

• How predictably can your business convert leads into customers?

• How predictably can your business deliver results and satisfaction?

• How predictably can your business create repeat customers?

If you scale unpredictable, you’ll only end up with bigger problems.

If you scale lead generation but your company’s ability to convert leads into customers is unpredictable, you’ll end up with bigger sales and conversion problems.

If you scale sales but your company’s ability to deliver results and customer satisfaction is unpredictable, you’ll end up with a lot of unhappy customers and damage to your brand reputation.

Bigger and more isn’t always better.

Stay small until you can make your small offers, small client base, and small team predictable. Then you can decide which levers you want to scale.

Self-managing team

Your company’s ability to operate and grow without needing you to be involved all the time.

• Is your team clear on what the goals and priorities are for the company?

• Is everyone on your team clear on their roles and responsibilities?

• Can your team execute on the goals and priorities without you driving them forward?

• Can your team identify and solve problems at least 80% of the time on their own?

• Can your leaders make decisions aligned with the company’s vision and values?

If your team isn’t mostly self-managing, scaling your business will lead to you being pulled in to manage the team.

Remember, scaling is a disruption to the homeostasis of the company.

A disorganized team will feel even more chaotic and disorganized during scale.

An organized and self-managing team will evolve through the disruption.

Enjoyability

Enjoyability is exactly as it sounds, it’s how much you enjoy your business.

• How much joy and fulfillment do you experience running this business?

• How much joy and fulfillment do you experience leading your team?

• How much joy and fulfillment do you experience serving your current clients?

Scaling unenjoyable, will only scale up your resentment and frustration.

I’ve seen people, who don’t enjoy their current business and the work they do, try to scale their company thinking: it’ll become enjoyable when I’m making more.

It rarely does.

Our energy and fulfillment rarely changes because we’re generating more revenue. Something that costs us our joy and fulfillment is rarely worth scaling.

And here’s the thing: when you shift your focus to make your business more enjoyable, it often naturally leads to scale and growth.

How to make your company scalable?

Let’s talk about some ways you can increase your company’s scalability.

Engineer Predictability

Make it work, then create systems and processes to make it repeatable and predictable.

For example:

• You find a method for generating new quality leads

• You continue to test the method until you know it repeatably works

• You hire or delegate to people to operate the process

• You work with them to build a system to consistently get results

• You test out a few other methods for generating leads

• You repeat the steps until you a few predictable ways of generating leads

Now you have engineered predictability to weather any season that comes.

Repeat this until you have engineered a business model that creates predictability in:

1. Lead Generation: getting quality leads

2. Conversion: turning leads into customers

3. Fulfillment: delivering results to customers

4. Retention: creating repeat customers

Now, you’re ready to scale.

Build a Self-Managing Team

Turn your team into a powerhouse that can operate with or without you.

• Create Operational Leverage: buy back your time and find people who can do things better than you can (and enjoy it more than you)

• Build the Infrastructure for Operational Excellence: design role clarity and accountability, aligned to how your business generates value (revenue, profit, client results)

• Develop Managers and Leaders: train your managers to better manage people and empower your leaders to call the shots like you would

Most entrepreneurs make the mistake of scaling first before putting in the time and energy to build for operational excellence.

Don’t be like most entrepreneurs.

Build the operations and team (even if you have a small team) needed for scalability, then you can scale sustainably with ease.

Make sure it is Enjoyable

This part is less about your business and more about you.

Your company’s scalability is proportionate to your level of personal growth.

• Time & Energy Management: develop high performance habits and systems that allow you to flow and adapt to the changes in seasons

• Alignment to Fulfillment: make decisions and make moves that bring you more fulfillment, not success (which will naturally follow)

• Self-Mastery and Identity Growth: invest in this. The biggest bottleneck in your business is usually you. The biggest obstacle will often be you getting in your own way.

If something is not enjoyable for you, start there.

Change it so that it’s enjoyable, or stop and pivot to something that will be.

Scaling enjoyable will NOT make it more enjoyable.

Yes, it’s common sense. But common sense doesn’t always mean common practice.

Conclusion

Focus on scalability, not scaling.

What makes your company scalable:

• Predictability

• A self-managing team

• Enjoyability

Hope you enjoyed this newsletter and found it helpful.

Your Pal,

Colin

P.S. Whenever you’re ready…

1. I created some tools and resources here to help you take your business to the next level

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