I’m writing a series called A Summary of How the Hidden Agents in the Stages of Growth Model Interact. You can also find this video series on the GCS Membership Site under the 7 SOG Videos tab, and they are called How it All Fits Together.
The real value in the 7 Stages of Growth is how all of the components work together to present a comprehensive picture of what business owner needs to know regarding their current stage of growth.
Stage 1: Start Up
1 – 10 employees
In Stage 1 it’s all about survival. Many businesses start because someone had an idea or they believe they can do something better, offer a new spin on something – whatever the reason, in this case they are starting a business and they become the Specialist, the expert, on what that product or service is. It is their passion, their energy, their vision that gets the company going. In this capacity they are showing two critical Faces of a Leader: the face of a Visionary and the face of a Specialist.
The CEO’s Influence in the company has to be Dominant. Without that Dominant Influence, direct or indirect, the company will not move forward. It will be like the proverbial ‘ship without a sail’. This Modality, the Dominant Modality is how the CEO exerts their presence in the company, day after day. That CEO’s presence must be Dominant as they are the life blood of the organization and will continue to be up to Stage 3.
The Builder/Protector Ratio for Stage 1 is 4 Builders to 1 Protector. The CEO must not only be a Builder, they must surround themselves with that like-mindedness in order to survive the challenges of a startup. Builders thrive on risk, look for every opportunity and aren’t cowed by the overwhelming issues that exist for them every day. There is need for the Protector mindset at this stage of growth to counter the optimism and sometimes tunnel vision of the Builders. Protectors apply the brakes when needed and should be encouraged to do so. For a CEO, this Builder mindset comes easy. As the company grows, however, managing their Builder-like tendencies become a challenge starting in Stage 3.
Creating focus and maintaining that focus, is most difficult in Stages 1 and 2. As the 5 key challenges testify, there is a lot of uncertainty that affects the CEOs ability to stay focused. Unless a company has outside funding, Cash Flow and Limited Capital needs can force a CEO to stray from his or her original core business too quickly, chasing projects that bring in money instead of staying focused on their overall goals and objectives.
Without a strong profit design and a targeted business plan, a Stage 1 company becomes Destabilized by the Chaos that comes as the CEO works to bring in money, find markets in which to sell their product or service and starts to bring in people to help deliver those products and services. Even if the CEO is focused on their delivery of the product or service, getting to market without strong financial backing can take too much time, causing the company to miss an opportunity which relates to the challenge Slow Getting Product and/or Service to Market.
Money (Profit) and People are the driving Gates of Focus for Stage 1. A Stage 1 company, as a startup, needs to generate sales and quickly get people on board who are bought into the CEOs vision, understand the goals and objectives and are willing to ‘go to the mat’ to get the product or service into the market, doing whatever it takes. This is why a Visionary Leadership Style is so important at this stage of growth. Finding people in the early stages of a company’s growth is all about fit — and skills and experience take a backseat. The staff at this stage of growth need to help Facilitate (make easier) how work gets done, how quickly it gets done and be flexible because there are so many unknowns and they need to react in alignment with the CEO.
Processes are not as critical at this stage of growth because the company is feeling its way and determining what works. Processes become much more important as a company moves into Stage 2 and there are more people, projects and clients to manage.
Stage 1 and NOT a Start Up: 1 – 10 employees
There are companies that choose to stay in Stage 1. Their business plan operates well with under 10 employees, generating enough income to provide a good living for the CEO as well as the employees. With the advent of the Internet, Internet companies are small, agile entities that can drive a lot of revenue with very few people. There are also many ‘brick and mortar’ companies that continue to thrive and not move out of Stage 1.
With that said, one of the key messages driven from the research of the stages of growth, is ‘If you aren’t growing, you’re dying.’ So even a 20-year old retail shop will start seeing an erosion of profits, clients moving away, market share dwindling if they don’t do something to continue to refresh their business goals and objectives. A company who has been in Stage 1 for a good length of time may need to reach out to a new market, open a new location, expand its product or service offerings. Something will have to ignite their growth and keep their revenue and profit alive.
Professional Service firms like CPA firms, Law firms, or Doctor offices set up their model to manage a set client load or a set employee or partner load. Their revenue model is driven by fees and specific offerings. They have some of the same challenges as a Stage 1 company when they Start Up, but because they don’t grow in Complexity, by adding people to their model, their challenges become more directed at becoming recognized for their specific expertise and they work hard to garner long term clients that they service for years. It’s a more ‘stable’ model, not without its challenges.
Check out my Flash Sheets by FlashPoint! where I explain all aspects of the 7 Stages of Growth by STAGE OF GROWTH, addressing how why the hidden agents show up as they do. This resource along with this series on How It Fits Together will provide you in-depth knowledge of this powerful model.
Your success. My passion.
Laurie Taylor, FlashPoint!