When a business starts out, it is typically a case of ‘all hands to the pump’. As it grows, these frenetic ways of working often get ‘baked in’. If they persist, they will eventually become obstacles to business growth. This wastes energy and creates frustration that can put relationships and businesses under stress.
So it was in this family-run, events management company. Run by two generations of an extended family, it had built an enviable blue-chip Client base and was now creaking at the seams. The family needed to identify and address the obstacles that would otherwise hold it back.
Diverse Business Challenges
The business faced multiple challenges. New stakeholders in key clients meant established relationships and revenue flows were uncertain; a reluctance to take difficult decisions meant costs were too high ; blurred accountabilities were poorly aligned to people’s motivations and competencies; robust management information was hard to pin down; and finally every family member was on the Board, making decision-making hard to impossible.
Preparing the Board for Growth
The family invited us to attend a board meeting, during which we could see what needed to change.
Firstly, we created a refined understanding of the board’s role and how this differed from the operational remit of the leadership team.
Next, and with the family’s agreement, we reduced the size of the board and created clearer roles on it. For this, we had to facilitate some emotionally charged conversations that would have been difficult without outside support.
Then we agreed who would be best equipped and willing to fulfil each role.
Creating Scaleable Systems and Structure
This reorganisation at board level meant that we needed to redefine accountabilities and responsibilities across each operational function. This called for more tough conversations if we were to unblock operational obstacles to further business growth. As an indirect result, one family member left the business to pursue a long-standing ambition and start a new venture.
We also initiated a rapid, external assessment of the financial state of the business and its associated systems. This was partly in view of the threats to forecast revenue. The Board needed to know that the business could both support and sustain further growth and that it had sufficient and accurate management information.
Looking Forward to Future Business Growth
The work to date and its consequences was a lot for the family to assimilate. At this point, the Client felt that they needed time to consolidate the changes and focus on their clients.
At a follow-up review, they reported progress on several fronts: much improved forecast revenues; further reductions to the cost base; improved decision-making; and a much clearer vision of what the business now needed to continue on its new-found growth trajectory.
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