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How to Identify and Address the Challenges of Excessive Business Growth Growing too quickly can overwhelm even the best-run companies. Learn signs that growth has pushed past your limits and strategies for preparing infrastructure, team structure, and processes as you expand your business in a balanced, sustainable way.

By Murali Nethi Edited by Micah Zimmerman

Key Takeaways

  • When processes start breaking down, and you find yourself constantly in reactive, catch-up mode, it's a sign you need more capacity.
  • It's possible to maintain quality while achieving your growth goals with intentional effort.

Opinions expressed by Entrepreneur contributors are their own.

We have all heard stories about once-small companies that grow explosively and struggle to manage their new size and complexity. While growth is an overall positive thing, there is such a thing as growing too quickly, both internally for a company's culture and processes, as well as externally in how it relates to customers and the broader market, as with many things in life, balance and moderation are key.

In this article, I want to explore some of the most common challenges companies face when dealing with excessive or unplanned growth, as well as some strategies to help address them.

Knowing when you've hit the wall

Imagine you own a cupcake shop. For the first few years, you're the only employee — you bake, decorate, and sell the cupcakes yourself. Then suddenly, you get featured on a popular cooking show. Orders start flooding in, more than you can handle alone.

At first, the deluge seems like a blessing. But soon, you're overwhelmed — working 18-hour days, you still can't fulfill all the orders. Quality is slipping. You're out of ingredients because you didn't have time to place orders. Your landlord warns she'll evict you because customers are lined up out the door. Something has to change.

You've smashed into the limits of a one-person operation. It's time to shift into the next stage of business growth by hiring help, expanding your kitchen, upgrading equipment, and so on.

In other words, when processes start breaking down, and you find yourself constantly in reactive, catch-up mode, it's a sign you need more capacity. The tipping point will vary for each company, but if productivity and quality take a nosedive, growth has become excessive for your present resources.

Other red flags include:

  • Customer complaints spike
  • Employees seem stressed, burned out
  • You're always scrambling to meet deadlines
  • Infrastructure creaks under the weight - think cyberattacks, IT failures, supply chain issues
  • No time for strategy, only tackling emergencies
  • Costs rising faster than revenue
  • Profitability declines

Essentially, if growth starts hurting rather than helping, it's time for a change.

Matching team size to stage of growth

One of the biggest challenges with a booming business is having the right number of properly trained employees. Not enough staff, and everyone is overworked, leading to errors and attrition. Too many people result in inefficiency and bureaucracy.

How can you tell if your team is properly sized? Business guru Ichak Adizes developed a useful model. He identified five stages of organizational growth and the appropriate leadership style and team structure for each phase:

  1. Courtship — the founding. Requires an entrepreneurial leader focused on making the business viable — a tiny team of generalists wearing many hats.
  2. Infancy — starting to grow. Needs a directive leader to instill systems and processes. The core team expands but is still fluid.
  3. Go-Go — rapid expansion. Benefits from a visionary, rallying leader. Roles become more specialized. More management layers were added.
  4. Adolescence - growth slows. Needs an integrator leader to coordinate divisions. Hierarchy formalizes, and new services are added.
  5. Prime - Mature company. Runs best with a structured, systematic leader — layers of middle management, highly specialized roles.

The takeaway is to assess which growth stage your business is in periodically, then scale your team appropriately. Trying to manage a 100-person company like a 10-person startup will lead to chaos. But running a 10-person shop like a rigid 100-person bureaucracy will cause frustration. Align your leadership style, organizational structure, systems, and talent to your current size and growth needs.

Preparing the infrastructure for growth

Have you ever seen a company make "Worst Website" lists because it keeps crashing whenever a hot new product drops? Or notice empty shelves because supply chains got clogged? Business infrastructure needs to be scaled up to match growth.

Common growing pains include:

  • Facilities - More employees means more office space, factory capacity, retail outlets, etc. Plan facility expansions or moves well in advance.
  • Technology - Increasing digital traffic can overload websites and backend systems. Upgrade bandwidth, storage, and security systems.
  • Supply chain - Spiking demand strains suppliers and logistics. Diversify sources, improve forecasting, and add warehousing.
  • Support - From customer service to HR to IT help desks, ensure support scales with growth. Hire staff, upgrade technology, and streamline processes.
  • Finance - Rapid growth requires extra capital — model future funding needs. Arrange credit lines and evaluate investors/loans. Slow payments can also starve growth, so improve invoicing and collections.

In other words, growth exposes weak links across the business - identify those chokepoints early and strengthen infrastructure before it snaps.

Maintaining Quality During Growth Spurts

When demand skyrockets, it's tempting to focus solely on volume - churning out as much product or service as possible. But this usually comes at the expense of quality.

How can you maintain quality standards during growth spurts? A few strategies:

  • Incremental expansion - Rather than doubling your business overnight, scale up gradually. This gives you time to train employees, test systems, and learn as you grow.
  • Process excellence - Use lean techniques to identify and improve vulnerable processes. Standardize procedures, automate where possible, and keep simplifying. Smooth operations ensure quality.
  • Culture of quality - Build a workplace culture where employees feel responsible for quality. Empower staff to flag issues early and offer incentives for identifying improvements.
  • Continuous improvement - Make improvement part of everyday work, not a separate initiative. Use retrospectives, audits, and metrics to find issues and prevent recurrence.
  • Customer feedback - Actively monitor social media, reviews, and surveys. Complaints often highlight quality challenges. Rapidly address any defects or dissatisfaction.

It's possible to maintain quality while achieving your growth goals with intentional effort. If you're a florist experiencing increased orders and needing a solution to scale efficiently, I recommend checking out Hana Florist POS. As a florist-focused system, Hana Florist POS helps streamline operations, provide inventory management, and insights into financial metrics — all key aspects for navigating the growing pains I've outlined.

Murali Nethi

Entrepreneur Leadership Network® Contributor

CEO & Founder

Murali K. Nethi is the founder and CEO of SnapBlooms, a flower-delivery marketplace. His 24-plus-year background in enterprise architecture and IT allows him to explore business solutions in the retail industry.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

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