Taking a business from concept through creation and making it a successful operation doesn’t happen by accident. It takes careful planning and deliberate action through every phase of the business life cycle. Each phase sees different needs and shifts a company’s focus from one thing to another. Knowing where you are in the business life cycle – development, start-up, growth, expansion, or maturity – will help you develop a strategy for success.
Development
The first stage of the business life cycle is development – when you’re taking your idea and deciding how to make it into a viable company. During the development phase, company owners and stakeholders collaborate to create an initial business plan, outlining the products or services to be offered, the mission and goals to follow, and a basic plan for finances and marketing. This stage will speak the company into existence and lay the groundwork for its future, focusing on what the business will truly be and how it will operate.
Start-up
After opening, the business becomes a start-up. Here, you’re working towards gaining clients or customers and finalizing anything you may have missed during development. The start-up phase of the business life cycle is a difficult one to navigate, but an exciting time for your company. You’ll face many unique problems that can test your financial stability. You’ll face fluctuating business flow. But you’ll experience a whole host of firsts: first sales, first hires, first big triumphs. It’s a tumultuous time for a business that requires organization, grit, and determination, with a sole focus on survival.
Growth
Once you’ve made it through the start-up stage, the real fun begins – growth. This can often be the most enjoyable phase of the business life cycle as you’re seeing your hard work and preparation pay off. Your customer base is steadily accumulating and you’re seeing an increase in cash flow. What could be better? But this is the most critical time to create a plan of action. Mistakes during this rapid growth phase can become crippling errors, stopping the company dead in its tracks and placing it back in the start-up phase with a new, negative public image. If done right, though, your growth can be capitalized on and maintained for an extended period of time, leading you to expansion.
Expansion
As your company grows, your local market will become saturated, both from your own offerings and that of your competitors. As this saturation increases, you may have to look elsewhere to take the growth you’ve worked so hard to achieve and turn it into expansion. This can be approached in two ways: expanding your product or service, or expanding to new locations or service areas. This decision should be a strategic one, made after both risks and rewards are carefully calculated. Making the right choice in this phase can duplicate your business into new markets and launch the company into further success.
Maturity
As you’ve expanded, your customer needs have expanded too, and it is your company’s responsibility to continue meeting those needs. You now have the financial and operational resources available to do so, but you must determine the best way to allocate these resources to do it. This requires long-term planning: taking into account new technologies, new regulations, marketplace shifts, talent needs, succession planning, and all manner of long-term goals. This lens of long-term thinking about your company’s life will keep you ahead of the curve and allow you to maintain maturity.
What phase of development is your company in? Do you have a plan to establish success and forge ahead into the next phase of the business life cycle?
Forge Business Solutions focuses on business development, strategic planning, and company growth for businesses large and small by identifying the current state of the business and creating a plan of action for success in all phases of development.