What's the secret to growing a company from inception to $500 million in sales? While there is no universal answer, there is a pattern of success anyone can follow. As an entrepreneur, small business owner, CEO, or interested party, one of the best ways to steer a growing company in the right direction is through a continuous state of reshaping, refining, and re-tuning the business.
As you do so, keep in mind this is more of an art than a science. It takes skill, creativity, and a steady hand to know what needs to be done to create a final masterpiece.
The ice sculptor and the swan
In order to better visualize what I'm referring to as "reshaping" a business, it helps to think of a new company as if it were a giant block of ice. As the president, CEO, or owner, you are the ice sculptor--it is your job to transform that ice into a "swan".
Every stage of the sculpting process is going to look different. As you move through each phase, you'll need to add new details, bring in additional tools, and use new processes in order to achieve your original vision.
If the artist did not constantly work at reshaping the ice, the swan (end vision) would never emerge, and the result would be a giant melting mess that swirls down the drain. This same concept can be applied to a new business, where stagnation is the kiss of death.
As your company grows, you'll need to hire better talent, possibly switch channels or partnerships, open warehouses internationally, or improve your product. The only constant is change as you reshape and refine. Yet, the paradox here is that you don't want any changes that will disrupt the original vision. If you've already carved out the wings of the swan, it is not the time to decide you want to sculpt a bear instead. To put this concept in a business context, if you start a company that sells macaroons, but after opening three new locations decide to also sell cleaning supplies, you're likely going to destroy the business you set out to build.
Companies who reshaped and refined their way to success
There are many examples of companies that successfully "changed the tires on the car while it's driving down the road". They were steadfast in their vision, yet knew when, where, and how to reshape. Two classic examples include:
While the company's namesake may suggestion otherwise, the McDonald's brothers were not the ones who brought the Golden Arches to greatness. The larger-than-life, international success of McDonald's rests largely on the shoulders of Ray Kroc, an American entrepreneur who, arguably, was more passionate about the potential to grow McDonald's than the original founders.
After getting involved with the franchise, Kroc saw the massive potential McDonald's could have on a global scale and made several innovations. He made improvements to the hamburger preparation assembly line, standardized the taste of every burger, invested heavily in good talent, and more. Eventually, he became frustrated with the founders' resistance to expand and bought out the company in 1961. Through his constant attention to detail and desire to perfect the company's secret sauce, Kroc got McDonald's to outpace Burger King in 1977. Afterwards, Kroc re-assigned himself to senior chairman and turned over the reins of the company he carefully shaped for 16 years.
Experimentation is at the heart of Jeff Bezos' business philosophy and it helped move Amazon from garage-based startup to the largest Internet retailer in the world. Furthermore, when asked about what makes a successful CEO, Bezos replied, "We are stubborn on vision. We are flexible on details." Amazon was not afraid to dip its toes in the water of the media content, cloud storage, and consumer electronics businesses all while building out an amazing distribution infrastructure that has created an incredibly wide moat for their core ecommerce business. The combination of a clear vision, flexibility, and constant experimentation was the winning formula Bezos used to shape a company with a current net worth of $66.4 billion USD.
The ability to bring a company from a rough and unformed concept to a streamlined and profitable business is, without a doubt, an art form. However, you don't need to rely on innate talent to achieve greatness while growing a company--it is a skill that can be learned.
Stay tuned for part 2 of this series where I will explore specific ways in which you can stay true to your vision and expand your business in a controlled manner.