What does Scalable mean for your small business?

What does scalable mean? Here are my four criteria (that I think will help you)

1. Your business is systematized so it can run without you. The primary reason why most small businesses aren’t scalable is because owners/entrepreneurs aren’t scalable. If your business needs you and your brain power and effort, it’s not scalable. It’s an incorporated career.

To be scalable, it has to be able to run without you (which is actually good news for you because being scalable means you’re freed up to work on big projects, take time off for vacations and/or start new projects/companies/ventures).

2. Your business can produce a consistent and predictable result for clients/customers (i.e. that it’s replicable). There’s nothing wrong with leading a service-based business, the problem is it’s hard to scale because each customer/client tends to require a customized solution (think attorney, consultant, accountant, architect, etc.).

By definition, a customized solution can’t produce a consistent and predictable result because it’s not repeatable. So, the trick for most small businesses is to learn how to take what they do and reduce it to a process that can be applied over and over again to produce a predictable and consistent result.

3. Your business isn’t dependent upon exceptional talent. Now, I want you to notice I didn’t say your business needs to be able to run regardless of who’s employed because that’s a lie. You’ve been to some franchises one time and others multiple times. The reason why? The people, they still matter.

However, to be scalable, your business can’t be dependent upon a lot of superstars. First of all, they’re hard to find and secondly, they tend to be expensive. Instead, you want to build a business that can be run with good, competent people who can work the systems and deliver extraordinary results.

4. Your business can handle a reasonable new influx of customers/sales. While VCs want your business to work if you get a rapid influx of 1,000 or 10,000 new customers this month, chances are that won’t happen to you. But, what if your small business were to increase by 50% this year? Or if you were to double or triple or even quadruple your sales this year, could your business handle it? Could you rapidly bring in new resources (from people and processes to hardware and finances, etc.) and get them up to speed to handle that demand?

So, if you want to build a scalable business, and aren’t concerned with building the next Google, I’d encourage you to focus on these four ideas.

1. Systematize your business so it runs without you

2. Build your core offering so it produces a consistent and predictable result regardless of who the customer is

3. Build your business so that good, competent people can produce those results using your systems and processes (though there’s nothing wrong with grabbing as many highly-talented people as you can)

4. Design your business so it can rapidly handle a decent influx of new customers/sales

Based on those criteria, how are you doing? My guess is you probably now know you have some work to do.