Are You Ready to Scale Your Business? — Ultimate Checklist (Part 2)
Read Time: 6 min
The six crucial things you need to scale your business successfully.
Knowing these could have saved me several hundred thousand Euro and years of pain.
Last week, I gave you a checklist of 8 essential things you need before scaling your business.
These first eight are about cleaning up your business before adding anyone else.
These eight essential things could have saved us more than a million Euros in my last business.
If you missed the last one, you can read it now on my blog.
Most businesses I see are not ready to scale.
I see it over and over again:
Founders adding team members too early.
Scaling the team too fast.
The team breaks apart a few months later.
They have to fire half of the team or go bankrupt.
This week, I have the second part of the checklist for you.
When you have cleaned up, you can scale your business.
But scaling will only be successful if you nail the following six points.
4 and 5 could have saved me another 200k EUR.
The Six Things You Need to Scale Your Business Successfully
You can find the complete checklist ready to duplicate in the link below.
>>> Complete Ready to Scale Checklist for Entrepreneurs.
1. Have the Money to Scale
As founders, we do business; we don't gamble.
Especially not with the lives of others.
Have at least six months of reserves right now to ensure the company's runway when you hire someone new.
This includes salaries for the whole team.
It takes, on average, three months for a new hire to contribute at their total capacity.
Hiring them is a bad decision if you can't keep them for at least six months.
It is even unethical to hire them without communicating how long you can afford their work is even unethical.
You expect someone to dedicate a significant part of their life to your project.
You expect a person to put their financial security into your hands.
Make these decisions as easy as possible for the other person.
Yes, we want to scale fast, but we want to scale sustainably more.
Remember your runway life bar.
If you dip to 0, your company is dead.
It doesn't matter if you get more cash two months later.
You're dead before you get that cash.
Conversely, business is way more fun if you have reserves to play with. 😉
2. Defining Tasks for New Hires
One thing I could have done better hiring my first teammates was to know what they would be doing.
It would have helped me to pick the right person for the role during hiring.
It would have made onboarding them so much easier.
They would have reached their top speed a lot faster and with less effort.
As always, I need to know exactly what I want before asking someone else to do something.
If I can't explain the outcome I want to achieve, how can I expect someone else to create that outcome?
If you already achieved the previous point on this checklist, this point will be easy.
You know what responsibilities you want and can delegate.
You know what your 4D distribution looks like after hiring this person.
And you know how their 4D distribution should look.
The only thing you need to do now is to communicate this to your prospect to find the right person for the task.
Bonus points if your position description online already contains this information.
This will save you a lot of screening time during the hiring process.
3. Understanding and Documenting Company Culture
Knowing what a new hire is doing is not enough.
You must also understand how they will do it and what the collaboration will look like.
Someone else can only take responsibility in your company when they know the culture.
Your company culture guides everyone's behaviours and decisions.
Your culture is directly reflected in the work environment.
Only one person not fitting into the culture can destroy the team's productivity.
This is why I advocate hiring for culture instead of expertise.
I can train any skill I'm hiring for.
Before hiring, I did that task myself so I can teach someone else to do it at least as well as I did.
If you have the right person, anything further can be developed later.
Make sure that everyone has access to the documentation of your culture.
They must be able to read up on it when something is unclear to them.
Just as with everything else, externalize your thoughts to multiply their effect.
4. Solid Hiring Process
Filling an open position takes between 42 and 62 days on average.
This range depends on the skill level needed for the position.
The higher the skill level needed, the longer until the position is filled.
A structured hiring process can speed this up significantly.
With a solid hiring process, we filled our engineering positions within 33 days.
We made decisions based on facts instead of relying on our guts.
You came this far; setting up this hiring process should take you no time.
You already know precisely who you want to hire, what they will do, and the culture that will guide them.
With that knowledge, you can:
Write detailed position offers.
Sort out 90% of bad applications during screening.
Assess their cultural fit during interviews.
And test the skills they should bring with assignments.
With such a hiring process in place early on, we could have sorted out the bad hires already at screening time.
This would have saved us about 200k EUR—expensive learning.
5. Detailed Onboarding Plan
Nothing sucks more than starting a new position but not knowing what to do there and what is expected from you.
Before you hire someone new, you should have a plan for onboarding them into this position.
Who will they be working with or reporting to?
How will you train them in your culture, tech stack, and processes?
How do you get them from zero to hero in the shortest amount of time?
As a founder, your task is to design the work experience of your team.
What do you want your new team members to experience when they join the team?
If this is not your strength or passion, consider hiring a chief of staff or COO.
Do this as your first hire to delegate this responsibility.
With such an onboarding plan, we could have the hires we made up to speed within one month instead of three to six.
We could have also sorted out the misfits within the first month instead of six months.
6. Managing Accidental Diminisher Leadership Traits
As leaders, we must learn many skills we usually don't use in our professions or daily lives.
Even worse, throughout our lives, most of us pick up habits and world views that make us unfit to lead others.
I call those negative traits Diminisher Leadership Traits.
Being good in our profession doesn't mean we are good at leading.
Strangely, most companies still use this method to fill their leadership positions.
One of my diminisher leadership traits is that I want to help people too much.
If someone has a problem, I jump in to save the day.
Even though my intentions are good, this is a terrible habit for a leader.
I want to help remove every blocker they might have.
This is my job as their leader, right?
Yes, but I end up taking away their responsibility.
They stop thinking because they know I have all the solutions.
Ultimately, I end up with a team of brainless zombies waiting for me to micro-manage them.
Humans tend to go the path of least resistance.
If someone else has the solution, why should I invest more effort in finding one myself?
This is only one example.
There is a whole list of diminisher traits for leaders.
The important takeaway for you today is to be aware of your diminisher traits and keep them in check when you hire.
Otherwise, you end up with more work and a team that doesn't perform.
You can find the complete checklist again, ready to duplicate, in the link below.
What's Your Score?
Now, you have the complete checklist you need to scale your business successfully.
I know 14 points is a long list, but ignoring them will cause your business to die a slow and painful death.
I had my share of failures due to ignoring these.
Take the test yourself.
Are you ready to scale?
How many points can you check off on this list? 1/14, 5/14, 14/14?
This is your progress bar to get to the next level.
Outgrow your current level and start playing in the next league.
Implementing this checklist will cost you only one or two months of work.
This checklist will save you years of pain and countless Euros.
Wait, wait, wait! Marcel, none of these points on the list tell us how to do our marketing or what we need to scale our sales.
There is a simple reason for that:
Sales and marketing don't matter when scaling your business.
It is more important to hire the right people in the right environment and let them do the right things.
Then your revenue will grow by itself.
Your team will grow your business for you.
Tell me in the comments below how many points you get on this ultimate scaling checklist.
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Thanks for reading to the end!
You rock!
Cheers,
Marcel