Small business owners face the challenge of growing their organization with limited resources. You may think this dilemma is somewhat rare, but 99% of companies are considered to be small businesses. Any major misstep can cost you a big client or potentially the entire business, depending on how critical the mistake is. The best scenario for your organization is to consider slow growth, wise project and customer selection, and focus on profitability by planning, requirements gathering, and scope management. Let’s consider these best practices for managing projects effectively while growing your small business with limited resources.
Slow and steady wins the race
Rapid growth is an exciting temptation for small business owners. It’s thrilling to see revenue grow beyond expectations, making it difficult to say no to new projects or further expansion opportunities. Revenue growth is positive, but can distract you from important consideration of the possible downsides. Before you leap to add additional projects or initiatives, ask yourself these questions:
- Do you have the resources (people, material and capital) available to take on new work?
- Does your team have the capacity to meet these new commitments?
- Can you keep the quality bar high?
It’s important to remember that rapid growth often comes with a price tag. With a small team, you likely have limited skill sets represented and limited access to new technologies needed to scale your business. Sometimes the best course of action is to grow at a measured and intentional pace, with only one new project at a time. You know the saying, “slow and steady wins the race.” Taking on too much without the appropriate bandwidth or resources could cause damage to your brand if you aren’t able to deliver on time and with quality. Or could influence you to invest in hard to find and expensive human resources when you simply have a short-term capacity constraint.
If you’re having trouble understanding if you have the capacity or appropriate resources, investing first in project management software to let it do the hard work. One piece of software I’ve found does a remarkably good job with resource planning, leveling, and optimization is LiquidPlanner. Solutions like this will show you if you have the bandwidth to take on that next project and help you forecast accurately when your team can take on more work. Let today’s specialized technology solutions do the heavy lifting. You don’t need a formal project management office (PMO) to understand your resource capacity.
Closely monitor scope creep
Saying ‘yes’ to everything may make you feel like a customer-centric brand, but saying yes too often can be highly damaging to your small business – and ultimately disappoint the customer you were aiming to please. Taking on too much, too fast will affect your ability to deliver your other projects on time. It will also damage your team’s well being and your own sanity as being overworked is both stressful and demoralizing. Take care to strike the right balance between delivering all your customer requests with what you have confidence your team can deliver well. To do so, I offer three simple resolutions to control potential scope creep:
Resource manage. Invest to understand your real resource capacity. Does your team have capacity to take on additional work? If not, feel empowered to say no. You agreed to a set of parameters at the beginning of your business arrangement.
Reprioritize. Customer needs change and/or market opportunities emerge. If your small team doesn’t have capacity to take on additional work, examine current work to determine if there are other things you can cut to make room for the new, higher priority needs or business opportunity.
Renegotiate. If you can take on new work, don’t do it for free. Renegotiate the terms of your arrangement to deliver on your client’s evolving business needs. Those requests need to be turned into profitable change orders that you can successfully deliver on and realize revenue from.
Make sure new business growth fits your long-term plan
Today’s business environment is fast paced. It is easy to get distracted with a ‘shiny object’ project that emerges. It is important to bear in mind the cost of such distractions. Most often, something tied to our longer-term strategic business plan will have to be sacrificed to make room for the new work. Should a clear-headed and sufficiently robust analysis justify a shift in your strategic plan, take the time to carefully convey what and why to the people who make up your team. Lean teams must collaborate well and trust each other. Unexpected and unexplained changes disrupt momentum and potentially undermine trust that once broken is hard to recover. You can certainly add more resources as you build your revenue and customer base. Until then, be intentional about pacing growth and engaging your people. This will ensure the team understands new work when it emerges and collaborates to deliver it as expected while maintaining alignment to the broader strategic plan.
My best advice to small companies with limited resources is to grow slowly. I’ve seen many small businesses go under for not practicing that principle. I’ve been called to rescue projects after small businesses have stretched themselves too thin. On one occasion both the CEO and the CIO handed me the keys and let me completely lead the project. I showed the sponsors that I was there to manage their projects successfully. I engaged the team, managed work according to our capacity, limited work to what we could reasonably deliver and earned the trust of leadership and the team. As a result, we consistently delivered on time and over time could deliver more by practicing these principles and deploying technology I’ve shared in this article.
Readers – what are your thoughts? Have you been through this? Do you agree with this list? What would you add to it? Please share your thoughts.
Brad Egeland is a Business Solution Designer and IT/PM consultant and author with over 25 years of software development, management, and project management experience. He has been named the “#1 Provider of Project Management Content in the World” with over 7,000 published articles, ebooks, white papers and videos. Brad is married, a father of 11, and living in sunny Las Vegas, NV.