How to Scale a Business: The Focus and Scale Method

According to the Startup Genome, 90 percent of internet startups fail. When analyzing the leading indicator of what causes business failure, their research team found: “70 percent of startups scaled prematurely along some dimension.” In essence, this study proves scaling a small business in an unfocused, unsustainable way gives you about a 10 percent chance of success. 

Having innovative ideas is a great quality to have as an entrepreneur, but when it comes to scaling, focus is vital. Navigating through 10 different ideas and projects eats up profits and keeps the team from growing at a faster rate. At best, this leads to disorganization. At worst, this leads to the end of your organization.

So, what does it mean to scale a business? And how do you decide what to focus on to grow your business?

If it seems companies like Google, Netflix, Pinterest, and WhatsApp have some kind of secret formula that allows them to scale with ease, they do. The good news? Follow The Focus and Scale Method below to replicate the process large-scale companies like these use for sustainable, long-term growth. 

Step 1: Get Clear on the Priorities That Matter

It’s scientifically proven that the human brain can only handle one priority at a time. Based on his studies, MIT professor and neuroscientist Earl Miller tells NPR, “People can’t multitask very well, and when people say they can, they’re deluding themselves . . . You’re not paying attention to one or two things simultaneously, but switching between them very rapidly.” 

Even if multitasking is impossible, it’s not uncommon for small business leaders to “focus” on three to four major business initiatives at once. As Steve Jobs once put it, “People think focus means saying yes to things you’ve got to focus on. But that’s not what it means at all. It means saying no to the hundred good ideas that there are. You have to pick carefully.”

In reality, people are much more productive when they focus on one thing at a time. This type of clarity also allows entrepreneurs to direct their team members toward work that truly matters and fulfills the business’s mission. 

Find the core of your company by:

• Identifying your unique gifts.
• Finding and leading with your “why”—the reason behind why the business exists.
• Aligning what you’re passionate about with the work you do. 
• Defining the company’s mission. 
• Prioritizing your top three initiatives by their level of importance. 

Step 2: Imagine the Possibilities

One way small business owners can start building a strategy for scaling their business is by visualizing what growth, amplified ten times over, looks like. A long-term business strategy isn’t laid out overnight—it’s a continuous creative process. Thinking beyond “what is” and thinking about “what could be” is a vital part of an effective business model.

In an article for Harvard Business Review, Martin Reeves and Jack Fuller write, “imagination—the capacity to create, evolve, and exploit mental models of things or situations that don’t yet exist—is the crucial factor in seizing and creating new opportunities, and finding new paths to growth.” 

Work through a 10x brainstorm by answering the following questions:

• What would your business look like 10xed? For example, envision your business with 10 times the revenue, employees, customers, and impact. 
• How did you visualize getting to this place? 
• Which milestones come between you and this visualization? 
• What team members, partners, additional services, data, and number of sales would you need in order to scale?
• What companies in your industry are already where you want to see yourself? 
• How did they achieve their success? 

Once mapping out your answers in detail:

• Take inventory of all of your business’s current ideas and initiatives in the works. 
• Next, circle the ones that fall in line with the company’s vision and mission. 
• Highlight the ones in green that bring in the most revenue.
• Highlight in red those that are a money drain. 
• Finally, review the list and pinpoint your most valuable ROI. 

Step 3: Develop a Strategy 

After brainstorming how to scale your business, it’s time to start building the company’s strategy for growth. As referenced in leadership and business expert John C. Maxwell’s The 15 Invaluable Laws of Growth, “working hard doesn’t guarantee success. And hope isn’t a strategy.” For this reason, the first law of growth is intentionality. Focusing on what you want and having a plan in place for achieving it creates an environment where work has a purpose. Every objective is designed to get you closer to your target. 

When scaling your business, be intentional by:

• Focusing on one major company goal that increases ROI. 
• Deciding the key action the business will take to achieve this objective. 
• Reverse engineering the process of achieving the core company initiative. 
• Developing a mapped out plan of attack based on working with the end result in mind.
• Asking yourself what has to be true for you to accomplish the established goal. 
• Determining what needs to happen during every stage of growth. 
• Setting terms that must be fulfilled before moving on to the next phase of the scaling process.

Step 4: Launch a Minimal Viable Product (MVP)

When scaling your business, never ramp up production on a product or service without first gauging your target audience’s temperature. Business consultant Eric Ries says one way companies can do this is by releasing an MVP, which he defines in The Lean Startup as a “version of a new product which allows a team to collect the maximum amount of validated learning about customers with the least effort.” 

Two real-life examples of MVPs are the first iPhone and the Tesla Roadster. Neither Apple nor Tesla would likely label these MVPs because customers don’t want a prototype. Nevertheless, businesses release MVPs to keep costs low while displaying their unique value proposition (UVP), attracting attention, and getting valuable feedback needed for creating a better model. 

Do’s and Don’ts of Developing an MVP

Do:

• Start with a basic product or service
• Establish a solid base model that has room to expand upon 
• Draw in the customer with unique, exciting features
• Gather information from customers and fans about their wants and needs 
• Evolve the product or service over time

Don’t:

• Begin by building something complex and expensive 
• Sacrifice quality
• Spend too much time and money on customizing the product or service
• Forget to conduct research on how to improve
• Stop adapting the offering to better suit your customers

Step 5: Implement Scalable Operational Processes

As Steven Covey, author of 7 Habits of Highly Effective People puts it: “People and organizations don’t grow much without delegation and completed staff work because they are confined to the capacities of the boss . . .” Developing organizational processes that aren’t scalable is like building your business inside a cage with no key to get out. In short, if it’s not scalable, it’s not sustainable—not for you, your business, and your employees. 

Scaling a business can’t happen when a leader puts themselves in the middle of company processes. For instance, this might look like an entrepreneur doing accounting or quality control checks. As mentioned above, business owners have to focus on their top priorities: the ones that grow the company in ways no one else can. Stepping out of company processes increases the time leaders have for working on their business, rather than in it. 

To set up scalable processes in your organization:

1. First, assess the current processes used in your business. Ask yourself what’s “working,” “broken,” and “missing”? 
2. Next, automate parts of your processes that drain valuable time (for instance, customer relationship management, follow-ups, lead generation, and marketing analytics).
3. Include step-by-step details on the company’s processes in the business’s playbook. Make this information as clear and informative as possible. Use images, screenshots, maps, and whatever else creates a better picture of how this work is done. The end goal is writing down the process so well that any person, no matter their experience level, can jump in, read the instructions, and successfully complete the task.  
4. After this, try the process out. During the testing phase look for areas that need more explanation or improvement, and make changes accordingly. 
5. Finally, once the process runs smoothly, delegate the work to someone who is capable of doing the job well. 

Step 6: Boost Sales to Their Maximum Potential 

One of the worst mistakes business owners make when scaling a business is leveling up without an increase in revenue. The Startup Genome Report cites that only 1 in 12 companies survives because of issues stemming from a lack of cash flow. Whether it’s hiring too many employees or heavily investing in product development or customer acquisition, the most common issue that causes startups to fail is spending too much, too soon. One way to bypass this error is getting increasing profit margins to a level that can sustain measures of growth (like adding to the team or ramping up production). 

To organically increase revenue:

• Make Your Unique Gifts Your Advantage
  Think about what you’re naturally more gifted at than most people. Write down a list of the top five qualities that come to mind. How can you use these qualities to your advantage? For each trait, produce an additional five ideas for adding these skills into your business plan for growth.
  
• Provide a Solution
  Businesses don’t sell products or services—they provide solutions. Honing in on the exact need you’re fulfilling helps focus the messaging your company uses to attract and retain customers. Think about it from the One Goal, One Action perspective: What is the one thing you’re going to excel at for those you serve?
  
• Tell a Transformative Story
  Marketing firm Yankelovich, Inc. found the average person sees 5,000 ads per day. One of the best ways companies can stand out and scale up in an era filled with digital noise is by creating content people want to consume. Businesses like Nike, Under Armour, and Yeti use their air time to tell their brand story. This involves taking customers on a transformative journey—one where the person starts with a problem, solves it with the help of a guide (the business), and ends their journey coming out on top.  

Step 7: Be Credible

Grandiose claims without evidence don’t impress customers. There’s a difference between saying you’re the best and proving you’re the best. In the age of information, the buying process begins in Google’s search bar. For instance, GE Capital Retail Bank’s Major Purchase Shopper Study shows 81 percent of customers research major purchases online before buying them. Knowing people want more information before buying means you must provide facts, stats, testimonials, and reviews on various brand touchpoints like your website and social media accounts. 

Step 8: Measure the Results 

The final step in scaling your business is monitoring the results of your initiatives. During this process, amplify sales and marketing efforts that are working. In addition, eliminate or adjust the ones that aren’t. Remember, this isn’t a static target, but one that’s always moving, evolving, and changing to create the best results. 

Master Scaling by Using This Resource

While this article provides a lot of insight into scaling a business, this is a process that company owners will likely want to research more heavily before taking the plunge. As mentioned before, scaling too fast, too soon is the leading cause of entrepreneurial failure. 

One of the most helpful resources Josh Axe uses in scaling his companies Axe Wellness and Ancient Nutrition is Scaling Up by Verne Harnish. As written in the book, “Scaling up is every entrepreneur’s dream—and nightmare. Hypergrowth is terrifying, and it’s most often success that kills great companies.” The book makes this process exciting, rather than scary by laying out in immense detail how to scale a company from the ground up. Since its release in 2014, it’s helped over 40,000 businesses grow into their maximum potential. It’s a highly recommended read for business owners preparing for growth. 

Click Here for More Information on Scaling Up