Business optimism is on the upswing. Against this backdrop, many small- and medium-sized companies are looking to implement strategies to propel their growth higher. Consider these tips to maintain your business agility as you ramp up new initiatives.
Confidence by the numbers
According to a survey among business owners with generally one to 100 employees, optimism about the economy rose to a 12-year high following the November 2016 election.1 More specifically, the National Federation of Independent Business (NFIB) Index of Small Business Optimism reached its highest level since 2004 in December 2016. The increase from the prior month was also its biggest monthly increase since July 1980, and the largest month-over-month change since the Index began.
Based on survey of small and independent business owners. Column 1 is the current reading; column 2 is the change
from the prior month; column 3 (the percent of the total change accounted for by each component).
According to the survey, these business owners feel particularly optimistic about the outlook for business conditions and real sales gains. Those two categories alone accounted for 73% of the gains. The report speculates that if the optimism continues, it will translate into spending plans and ultimately result in hiring, inventory purchases, and capital outlays.
Tips for business agility as you grow
Growth for a small- and medium-sized businesses can be challenging. On the one hand, your organization is ready for enterprise features, particularly in terms of software, HR and companywide knowledge sharing capabilities. But new support systems introduce new commitments. If companies don't invest in the right partners and processes, they may feel prematurely sidetracked. Consider these tips to boost your organization's agility during periods of rising growth:
1. Run experiments before deploying initiatives in full
Are your team members pushing for a new marketing program or a new hire? Before making such a commitment, encourage existing team members to run experiments on the job and start collecting data. For instance, if your sales staff is pushing for automation software, consider running some one-off campaigns to understand which platform and partner will be the best longterm solution.
2. Hire contractors before bringing on full-time employees
Not sure if you need an in-house marketing leader or accountant? Consider hiring a contractor or freelancer to fill the role before opening the position on a permanent basis. You'll be better positioned to understand whether a full- or part-time employee will be a better fit, what the role will entail, and which skills are necessary for success. Professional social networking sites are a great place to find individuals looking for these types of opportunities, and to evaluate whether they have the skills your organization needs.
3. Build processes early
During periods of growth your time is best spent pursuing new markets, customer bases, and product lines. If you're stuck backtracking to implement bookkeeping and expense reporting processes, for example, you may miss out on key market opportunities. Build processes early, before your company has a chance to let new opportunities slip through the cracks. It is often beneficial to craft essentials like brand identity and accounting systems early on, so you won't have to focus on those needs when more valuable opportunities arise. It's vital to have the right foundations in place for growth to help you focus on your future as an organization.
Consider outsourcing certain administrative functions so you can focus on building your business. These organizations are available to assist with writing policies, developing an employee handbook, creating a recognition/benefits plan, and more.
Business agility is not simply an attitude, it's a key capability that must be planned for. If you're not careful, you risk making the wrong long-term decisions. At the same time, if you're too careful you risk holding your organization back from capitalizing on growth opportunities. Strike the right balance by running experiments before building initiatives in full, making smaller talent commitments before hiring additional full-time employees, and building essential processes as early as possible.
Is growth in your future?
ADP® is your ticket to simplification, efficiency, and business risk mitigation. We can help you put a growth plan in place that maximizes your agility, as well as keeping the eye on the ball regarding ever-changing federal and state regulatory updates.
1 December 2016 NFIB Small Business Economic Trends.
- HR Management,
- Human Capital Management,
- Talent Management
- Research for Human Resources Professionals