Building Scope and Scale into businesses


If I were to pick up one theme which interests me in my professional pursuit, it would have to be the planning and execution of new business initiatives. This has also been a recurring theme in my life, as reflected in my choice of jobs and roles. The most interesting aspect of my present job at Ather is that it involves the same kind of journey. While the journey has been exciting but uncertain at the same time, I have never, till now taken out time to reflect on what building businesses really means about. I have predominantly worked in the manufacturing sector in industries like aerospace and automotive and they have shaped my observations below.

In very simplistic terms, building businesses is all about building scale or scope or both. The reasons involved maybe passion (a desire to do good, start new and so on ), aspirational (growth, market leadership), existential or just boredom for the promoters. Organizations on the path of building have to inevitably do one of the below: sell more to customers, sell to more customers, sell different things to the same customers or sell the same things to different customers. Of course, there is the added consideration of pricing, promotion et al.

Some of the critical elements to be considered for building businesses are:

  1. People: The importance of having the right people cannot be overstated. Borrowing from Bernoulli’s principle, I believe that it is essential to have both position (process orientation, skills, standardization) and momentum (creativity, problem-solving, agility) in the inherent characters of people who form these teams.
  2. Time: It is important for businesses to have an appreciation of the impact of time on their planning and execution cycles. A great idea, executed very well might still fall flat if it is anachronistic.
  3. Resources: I refer to resources in a very broad perspective, including connections, brand, goodwill and so on. Businesses need to plan out their resource forecasting and utilization to intricate detail, irrespective of how insignificant they might seem. To paraphrase from Dwight Eisenhower, plans are useless but planning is indispensable!

Some of the major risks involved here might be financial over leverage, overstretching of resources, building scale and scope in the wrong areas which are of no relevance to target customers or building them either too early or too late. I firmly believe that business school graduates are best suited for planning and executing these activities precisely because their general management education (ideally coupled with experience across different functions/ industries) prepares them to understand, evaluate and factor in these risks better.

Here are my list of must-do activities for businesses and professionals embarking or undertaking the growth journey:

  1. Split your activities into different time horizons and have different people responsible for mapping these horizons. It is seldom that an individual is able to perform efficiently and effectively across different time spans as the rhythms of activity are asynchronized.
  2. When in doubt, prototype. It is prudent to always undertake small, controlled experiments to increase confidence and manage risks and expectations. People rally better behind a small experiment which has succeeded rather than a grand idea which is yet to be proved !
  3. Be flexible early on in the process and take a lot of time to plan. The first organization I worked for and one of the most admired automobile companies ever, Toyota firmly advocates spending as much as 80% of allocated time in planning.
  4. Treat every activity as a learning exercise. We spend so much of our waking hours at work and deriving insightful learning from these hours is the best way to stay happy over a long term.

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