Big business strategies SMEs should take on for growth
Small and medium enterprises (SMEs) should not be run like a big business. Resource poverty is the biggest reason: SMEs do not have enough employees to manage hiring, bookkeeping, fund-raising and other business aspects—in contrast to large corporations, which have entire departments dedicated to them. Day-to-day operations also differ greatly: SME owners are highly involved, often dealing directly with customers and making huge business decisions on their own. CEOs of big companies deal with high-level issues; they have data teams and partners to consult on the risk-to-reward ratio of major business decisions.
Still, there’s plenty of things SMEs can learn from their larger counterparts. Learning long-term business planning, networking and cash flow management is crucial—these contribute to any organization’s success, regardless of size. And while most SME owners hope to grow into bigger businesses, their current size has the advantage of needing less decision-makers to execute new strategies and processes.
The big business strategies listed here can make a huge impact on SME operations and business planning—without requiring the same expensive business tools and resources that big businesses use.
Systems and processes
SMEs must structure their businesses as if they are much larger than they actually are. This means separating business systems into four distinct categories and automating them whenever possible:
- Marketing system. This generates a consistent flow of leads into the business. But running digital ads can be daunting for many SMEs, and no one wants to allocate a budget for marketing tactics they don’t understand. So what’s free? Sending remarketing emails to previous clients, setting up automated Facebook Messenger responses or responding to reviews left on Google and Facebook business accounts.
- Sales system. After capturing leads, SMEs must have a process that converts them into paying customers. It can be as simple as automatically assigning a lead to an employee as soon as it comes in, or committing to call every new lead no later than one or two business days.
- Fulfillment system. The process of fulfilling customer orders in exchange for profit is often fraught with urgent issues. SMEs should have a system that automatically tracks a customer’s status from order to delivery, and a system that alerts the customer about their status so they are not kept waiting.
- Administration system. Issues on accounts, communications, human resources, and office maintenance can easily bog down any SME owner. Thus, a system that records concerns and flags them by importance is a good starting point to ensure nothing falls through the cracks.
Aside from freeing up time for strategy and planning, business systems can tell an SME owner about the health of their business in real time. When the business is ready to expand, owners can simply replicate systems or hand them off to new managers, without disrupting operations or reducing product quality.
Agile service delivery and product development
Agile service delivery is commonly used by startups, but any business that operates on a sequential delivery approach can adapt its methods. Agile is a form of project management designed to deliver products and services through processes and practices that strike a balance among speed, adaptability, product development and operations control.
In an agile environment, service delivery is planned upfront, focusing on what a team is capable of delivering within factors like cost, scope and time. The entire delivery process is then broken down into short developmental cycles called sprints. Every sprint delivers a working product to clients, which is then improved upon in the next sprint.
When adapted by SMEs, agile service delivery will limit nonimportant work in progress —prioritizing tasks that actually contribute to business goals. Coordination is another advantage. Employees must work closely together, sharing progress, data and issues as they happen, to ensure everyone is aligned and on track to delivery.
The agile approach also focuses on iterating better and better versions of a product, addressing many SME owners’ hurdles around product development. Many SMEs do not see a need to diversify or expand product lines, or find product research a costly endeavor. However, agile product development must be based on customers’ feedback and expectations—which SME owners can get for free, simply by creating a process that requests reviews from recent clients. This ensures an improved product is ready before interest in the current product line goes stale.
Agile product development for SMEs doesn’t end with product quality. A good product can be developed for franchising opportunities, or branded to appeal to an international market. Product development, more importantly, can pinpoint and address hard problems that every other businesses avoid—helping the business carve out a competitive advantage.
Personal branding
Many SME owners choose to hide behind their business brand, but a lot of local high-profile brands have built credibility and connections by showing the face behind their businesses. People are naturally interested in other people’s narratives. By developing an authentic and committed personal branding that aligns with their brand promise, an SME owner can establish themselves as an expert in their field, attract new opportunities from like-minded people, develop a larger network, and get free publicity for their business simply by posting regularly about their business struggles and experiences.
Investing in the above may seem obvious to any businessperson, yet these three strategies often fall to the wayside whenever SMEs are bogged down by fulfillment and administration concerns. So take the time to develop and allocate resources for organized business systems, agile delivery and product development and expanding personal branding. With financial technology support making it easier for SMEs to access revolving credit lines and new opportunities like business-to-government contracts, SMEs can achieve significant growth by laying the proper groundwork for expansion in place. INQ
