How to develop a smart growth strategy
Read time: 3 minutes
Managing a fast-growing business presents both opportunities and challenges. The chance to become an industry leader is attractive, but it comes with the risk that demand will outstrip capacity.
To avoid that pitfall, you need a strategic plan that’s backed by adequate financing, empowered employees, and the right information and communications technology.
So how does a company grow in just a few years from three guys working in a frigid apartment to one of the hottest game developer for media giants such as Warner, Electronic Arts, Disney and Nickelodeon?
Rapid growth is a doubled-edged sword
Such a meteoric rise may sound like a dream come true, but for the unprepared, it can be the end of a business.
“We were able to successfully manage growth, and that’s where many small companies fail,” says Steve Couture, the entrepreneurial force behind Quebec City video game developer Frima Studio. “It came down to having the right balance and a passion for three things: A creative artistic style, a solid technology base and good management.”
Indeed, fast growth can be a doubled-edged sword for entrepreneurs. The opportunity to expand and make more money will be lost if demand outstrips capacity, leading to disgruntled employees, strained client relationships and shoddy products or services. That’s why it’s vital that business owners step back from the daily grind and ensure their fundamentals are in order.
“Fast growth can kill your company if it’s not well-managed,” says Patrice Bernard, Senior Vice President, Products and Shared Services at BDC. “You have to define your growth objectives, and then decide how much growth you can support and how much financing you need to support that growth.”
A well-planned growth strategy
Bernard advises companies experiencing fast growth to begin by creating a growth strategy that identifies the human resources, processes, tools and information systems needed to meet targets.
“Expect to introduce new information and communications technology to improve your sales, productivity and financial controls. You should also plan for expanding facilities, adding machinery or hiring new talent.”
One of Frima’s biggest challenges has been attracting and retaining skilled people in an industry that is home to multinational competitors with much deeper pockets. Frima found its niche by creating a positive work environment for its 300 employees.
“We offer flexible work schedules, fresh fruits every day, massages, free bus passes and car sharing,” Couture says. “We also award points based on performance, which can be exchanged for services like grass cutting, changing your winter tires, tax preparation or even babysitting.”
A successful growth strategy depends on a flexible management structure that allows your business to respond quickly to market demands.
The last thing you want, says Couture, is layers of bureaucracy that stifle your agility. Frima’s structure enables people to pare off into smaller groups that can focus on different market platforms, such as mobile or multiplayer online games.
From its humble beginnings, Frima has become one of Canada’s top independent video game developers, with products based on some of Hollywood’s biggest brands—including Harry Potter and SpongeBob SquarePants—as well as games of its own.
Couture says he’s grown as an entrepreneur as well. He learned the hard way that business owners can’t expect to do everything on their own.
His advice? Make managing the business your No. 1 passion.
“I started out passionate about the programming side of the business,” he says. “Now, I’m far more passionate about things like human resources, accounting and growth projections. I’m an avid entrepreneur and I love it.”