Scrambling to Scaling
The central challenge for growth companies is making the shift from "scrambling" to "scaling." Few organizations effectively navigate this transition due to what Stagen refers to as the performance paradox: the "winning formula" that created a company's initial success becomes the very thing that holds it back from getting to the next level. Additionally, typical entrepreneurial organizations are limited by a number of factors, including: executive leadership experience, infrastructure limitations, poor understanding of key financial drivers, an overemphasis on sales and top-line revenue growth, and a reliance on individual heroics to solve problems.
As illustrated in the table below, new competencies and a radically different mindset are required for an organization to make the move to scaling.
|Erratic results||Sustainable results|
|Don't have time to plan||Planning frees up time|
|Revenue focus||Profit focus|
|Higher variable cost, lower fixed cost||Higher fixed cost, lower variable cost|
|Great things accomplished through individual heroism||Great things accomplished by teams leveraging a powerful model|