Twenty years ago, James Fischer, had an ambitious goal.

The co-Founder of the Origin Institute, a research and consulting company out of Boulder, Colorado, wanted to understand and decipher the patterns, behaviors and the characteristics in entrepreneurial enterprises – and – develop best practices to better navigate the trials and tribulations of business growth.

Six years and over 700 CEO interviews later, Jim documented his findings in the book, “Navigating the Growth Curve: 9 Fundamentals that Build a Profit-driven, People-centered, Growth-smart Company”.

What did he find?  A road-map describing the 7 predictable stages of growth that companies travel through in their journey from start up to going ventures of 500 people or more, drawn from the collective experiences of hundreds of entrepreneurial companies across 35 different industries.

Laurie Taylor, another founding partner, introduced me to Fischer’s Seven Stages of Growth model ten years ago. She came out to Philadelphia that year to present the model – and their findings – to a group of mid-market business leaders and CEO Think Tank® members.

The CEO’s and their teams with whom we work loved it, especially for the insights the model gives them, not only into their current stage of growth but also into what the road ahead looks like.  It’s called  the 7 Stages of Growth because his research found that there were actual 7 predictable stages that companies traveled through from Stage 1 – “Start Up” with less than 20 employees to Stage 7 “Visionary” with over 160 employees.

Here are 4 key findings that every small and mid-market company should know about growth and the challenges along the way:

1)      Complexity is about employees, not revenue.

“Money and processes are easy to manage compared to the dynamic impact that people bring to the table,” writes Laurie.  Although the “People” challenge shows up as the number one focus at different stages along the way, at one point delegation skills become critical while later the focus shifts to employee engagement and creating buy-in to the vision.

2)      Each stage of Growth has five overriding challenges.

Understanding the different challenges at each of the Seven Stages will help you to prioritize and focus your activities.  There are a total of 27 challenges that companies face along the growth path, different issues at different stages.  A warning – if the Executive team doesn’t deal proactively with the challenges of each stage as the company grows, they just add up as the company adds people.  In other words, challenges don’t go away.  They just come back to haunt you.

3)      Know what “Chaos Zone” is approaching and prepare.

Just like the Google Map app, the 7 Stages model will also tell you when you’re facing a significant transition period that will require increased attention. Fischer calls these “chaos zones”, aptly named Flood Zones and Wind Tunnels.

Expect a level of confusion at these “chaos zones” as leadership and employees adjust to either increased levels of work (Flood Zone transitions) OR the need to revamp and revise methodologies, processes and procedures that no longer work and acquire new ones that will support growth (Wind Tunnel transitions). Either way, each of these “chaos zones” need to be managed proactively or they will cripple the business.

4)      Different Leadership “rules” exist for each Stage of Growth.  

Growth isn’t just about dealing with challenges and knowing when to change your focus. Leadership styles, for both the CEO and the management team also need to change as a business grows in employees and complexity.  What’s appropriate for a “ramp up” CEO who needs to be a coach – won’t fly later as a company passes the 160 employee mark when a more visionary approach is required.

Of course there’s lots more to the 7 Stages Tool, as far as I’m concerned the best “business map app”, but hopefully this brief tour will get you thinking – and acting – differently as you plan your course for the future.

And if you’d like some help Navigating the Curves, reach out to us and set up a time to talk!

 

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