Why is it so hard for a small company to grow bigger?

Mondo Workplace Updated on 2024-03-05

Key points:

1) Lack of willingness, motivation and strategy to grow the company.

2) Lack of continuous excellent experience combing and accumulation.

3) Lack of standardized work awareness to form excellent experience into core requirements.

4) Lack of awareness and ability of accumulation and fission of outstanding talents.

Small companies face a range of internal and external challenges when they want to grow into large enterprises. Some of the key challenges include: first, the lack of a clear and firm vision, motivation, and strategic plan to scale; Second, small companies often fail to effectively accumulate and inherit excellent practical experience in their daily operations. In addition, there is a lack of understanding of the translation of good practices into standardized workflows, resulting in the inability to form a replicable successful model. Finally, the shortcomings of talent management are the difficulty in attracting, cultivating and retaining high-quality talents, and motivating them to engage in internal fission and innovation.

1) Lack of willingness, motivation and strategy to grow the company.

Many small company founders may be content with the status quo or limited to short-term profit goals, without fully realizing or pursuing the determination to make the business bigger and stronger. For example, some small business owners may be more concerned about cash flow and survival than long-term brand building or market expansion. At the same time, the lack of a clear strategic plan is also a bottleneck that restricts its development, such as ignoring diversification, unclear market positioning or insufficient analysis of the competitive situation, which may lead to small companies being unable to seize opportunities and expand their scale in a timely manner in the face of market changes.

2) Lack of continuous excellent experience combing and accumulation.

In the process of rapid development, small enterprises tend to ignore the systematic summary of successful cases and lessons learned, which makes the organizational wisdom not effectively precipitated and inherited. For example, if successful solutions to specific market challenges are not documented and scaled up in a timely manner, other team members may have to start from scratch when they encounter similar problems in the future, wasting resources and time and impacting the overall growth rate of the organization.

3) Lack of standardized work awareness to form excellent experience into core requirements.

Successful small businesses often have unique operating models and business processes, but without distilling them into standard operating procedures and rolling them out across the organization, you can't ensure that these benefits can be replicated and applied at scale. Starbucks, for example, has been able to expand rapidly globally thanks to a high degree of standardization of its coffee-making and service processes, based on the effective translation of best practices and best practices.

4) Lack of awareness and ability of accumulation and fission of outstanding talents.

Talent is an important driving force for enterprise development, and small companies are often limited by problems such as low visibility and insufficient salary competitiveness, making it difficult to attract and retain high-quality talent. In addition, many small companies have not established an effective talent training system to allow existing employees to grow into senior management or technical talents, and achieve organizational fission through internal promotion or incubation of new projects. For example, Google encourages intrapreneurship, and many well-known products such as Gmail and AdSense are "20% of the time" programs of employees, which greatly facilitates the growth of talent and the birth of new projects.

To sum up, the main reason why it is difficult for small companies to grow is the lack of vision and ambitious development goals at the leadership level, and the lack of strategic planning and execution; Lack of documentation and dissemination of lessons learned in practice, and failure to institutionalize good practices into replicable standard processes; There are also shortcomings in talent management and training, which cannot form an excellent talent echelon, which hinders the improvement of enterprise innovation capabilities and the rapid expansion of scale. To break this dilemma, small companies need to carry out comprehensive upgrades and reforms in leadership, strategy formulation, experience inheritance and standardization, and talent system construction to achieve a leap from small to large.

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