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The ‘Scale-Up Mindset’: Do you have it?

What is it about scale up companies that means they can grow so fast?

It comes in all shapes and sizes, but for almost all SME owners growth is the goal.
Entrepreneur Team Meeting

But why do some companies scale exponentially with a seemingly effortless ease? Whilst others find growth painful and hard to achieve?

More than anything else, this depends on leadership mindset.

The scale-up mindset

Before we explore the scale up mindset, let’s define both ‘growth’ and ‘scaling-up’.

For this exercise, we’ll treat a ‘growing company’ as one that takes a company from 1 to 100 customers. And a ‘scale up’ as a company that goes from 100 to 100,000.

Growth relies on human insight and decision-making that is often made in ‘live’ scenarios. Scaling-up is built on an ability to predict, plan for and make repeatable decisions time after time.

A growing company might have an experienced leadership team who make intelligent decisions about customer enquiries daily. These highly valued individuals have taken months, if not years, to develop the skills needed to make these decisions accurately.

A scaling company, however, will onboard new people quickly and support them with strong processes that simplify decision-making. This will mean a new employee can effectively make complex decisions within days of joining the company.

Scaling companies are built on processes that have been designed to scale. Processes that are efficient, repeatable and simple. This means that problems are foreseen and overcome long before they emerge.

 

Do you have the scale up mindset?

Amazon began as a start-up. It didn’t grow to become one of the largest companies in history by simply duplicating human effort. Instead, Amazon’s founders created intelligent processes with a relentless focus on the customer. They coupled this with an obsession for predictability, efficiency, and repeatability.

Consider your company. How easy was it to onboard your first ten customers? What about your next 100? Just as easy? If a spike in demand meant you needed to onboard 1000 new customers tomorrow, without any drop in service, could you do it?

That might sound like fantasy, but it’s exactly what happened to a number of Thinc customers during the first few months of the COVID-19 pandemic. Fortunately, they were prepared and scaled seamlessly.

But it’s not only freak events that can cause such significant changes in demand. Almost all scale up business owners report a period in time where their business ‘took off’ and they were suddenly presented with an entirely new business landscape to negotiate. Crucially, those who already had the scale up mindset were already well prepared to successfully navigate this exciting new world.

 

Scaling up your business – a ‘make or break’ moment

Growth mindset businesses are often ill-equipped for significant change. If orders suddenly increase, they’ll scramble to find short-term ‘fixes’ by throwing in more minds, minutes and muscle to meet demand.

Even if the challenge is met, the time and energy wasted on performing these manual tasks prevents them from working on other important areas of their operation. If repeated, this could have catastrophic consequences for the business overall.

So, if just working harder isn’t the answer, what factors allow some businesses to thrive during these make-or-break events?

At Thinc, we coined the term ‘intelligent companies’ to describe the businesses who are best positioned to smoothly transition from start-up to SME and from SME to scale up.

The leaders of these companies invest in processes, systems, and technology – and do so with scaling as the focus.

 

Applying the scale-up mindset

The scale up mindset isn’t built by spending five years at Harvard Business School. It’s not a zen-like state or something that a lucky few are born with.

It’s a practical, problem-oriented approach that any business leader can adopt. It requires self-belief, clarity, focus on the larger goal, and a relentlessness in pursuing it. And, fortunately, these are probably the very traits that helped you get into business in the first place.

In short, almost every entrepreneur has the capacity to develop a scale up mindset. And it’s the number one factor in defining whether you are running a growing business, or a scaling business.

So, what are the main things to consider when scaling your business?

1. Your people

“To go fast, travel alone. To go far, travel together.” – African proverb.

This proverb is useful. But ‘fast’ and ‘far’ shouldn’t be considered mutually exclusive. Scale ups are both fast and capable of going extremely far.

This is why intelligent companies – companies ready to scale – focus on amplifying human potential. They take good people and unleash their greatness, and they do this at volume. By using technology to automate routine decisions, employees can focus on adding value.

Humans have the ability to foresee and overcome challenges, and when this is harnessed across the entire workforce, issues can be ironed out and addressed before they even materialise. This unleashing of human creativity and collaboration can create exponential growth in multiple directions.

2. Hiring and nurturing talent

This is building on the last point, but it’s important to note. Scale ups invariably need to find new people and make them a great fit for their organisation. Your mindset and approach to hiring, on-boarding, and training will be critical to the success of your whole operation.

How do you know whether these processes are right? Ask yourself two simple questions.

Question A. What’s our success rate with new hires?

If you work from a ratio that a minimum of three in four new hires should succeed, that’s a healthy rule of thumb to follow.

Question B. How quickly can new employees add value?

New people should be up to speed in days and adding real value in weeks. Any longer than that, and the likelihood is you’ve got a growth rather than scale up approach to on boarding talent.

These are broad principles to help steer your thinking and get you ready for a scale up mindset, but both the hit-rate and on-boarding speed will vary greatly by sector and role. However, it’s well worth considering the efficiency and repeatability of your hiring and training processes. If that’s up to speed, you’ll already be well on the way to cultivating the talent you need to scale.

3. Clean data and powerful process.

According to research from McKinsey, artificial intelligence (AI) is set to increase UK GDP by 22% by the year 2030. It is predicted that scale up companies will be the primary value creator in this significant uplift.

So, data and intelligence are clearly important, but how do they relate to a scale up mindset?

The fundamental shift is to change the view of how your decisions are made. Many growing SMEs make decisions based on information that is interpreted by people in real-time scenarios. Depending on the size of your business, this might mean dozens, hundreds or even thousands of independent judgements being made every single day.

A move towards faster, more reliable decision-making means moving away from ‘judgement’ based decisions. This may take you as far as utilising AI, which can add previously unimaginable speed, reliability and accuracy to your operation. Or it may involve creating technology-powered processes, that help people make the right decisions at speed and scale.

The secret-sauce of AI, allowing you to get the best analytics make better, faster decisions, lies in having great data to feed it.

4. Design everything to grow with you.

Many companies believe they need to understand their business’ immediate future to make the right investment decisions.  This is where a leader with a scale up mindset differs. Instead of focussing on where the company is today and tomorrow, they stretch their imagination to its outer limits, imaging where investment could possibly take them.

Forecasting the potential of a scale up takes extensive experience. But this is one investment you need to get right first time.

You need to design out tedious manual processes and bring in automated systems. Replace disjointed IT systems with a seamless ecosystem. And data needs to become the new oil in the system – a rich, precious resource that will keep everything running smoothly, even when running flat out.

Creating a business that’s capable of scaling-up isn’t simple. However, once the systems, processes, people, and IT ecosystems are in place, you can focus on increasing demand without having to worry about whether your business can handle it.

If you think you’re ready to scale, or want to learn more from businesses who have ‘been there and done it’ contact our scale-up team today.

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