This post comes from Ascend 2019 speaker Amy Lafko, the owner of Cairn Consulting Solutions. Want to see Amy speak about rehab therapy business and leadership strategy during a live interactive session? Register for Ascend here. Curious about the rest of the speaker lineup? Check it out here.
A few years ago, I was working as a director of rehab. My team of 35 had been in a really good groove. That’s when the merger was announced—and suddenly, I was supporting 15 more therapists in another county. Growth is good, but boy, it can be painful—unless you know what’s coming and how to work through it. At the time, I thought I knew what was coming; in reality, I didn’t have a clue. When a second merger was announced two years later, it was my opportunity to put into practice all that I learned to help manage the pain during that first round of growth.
Thanks to my first merger experience, I knew (1) how growth was going to affect the organization, (2) which things to focus on when, and (3) how to adapt my leadership skills. All of this made the second period of growth much less painful than the first.
7 Stages of Growth™
Based on the research of over 650 small businesses, the 7 Stages of Growth™ model was developed to provide knowledge on these three issues as well as the two types of transition zones that come with growth.
What’s a growth stage?
Understanding the dynamics of what your company needs as it moves through different stages of growth can mean the difference between success and failure. We may think that opening a business is the complex part, but the real complexity comes when we increase the number of employees. With that increased complexity, we move from one stage of growth to another. Through each stage of growth, different challenges present themselves, different leadership skills are needed, and there are different rules for success.
What’s a transition zone?
Between each stage of growth there is a transition zone. These transition zones are actually a phase of chaos that the organization moves through to prepare itself for the next stage of growth. Without that chaos, the organization would not be able to sustain itself or compete in the next stage of growth. These transition zones are going to hit you; you can’t ignore them or avoid them, but you can know when they are going to hit and how to prepare for them.
In these transition zones, the team is often confused about what is going on. Things were going great, and now everything feels chaotic. While leaders of organizations tend to understand and accept change (mainly because they are at the helm of creating that change), employees are often caught off-guard and confused. As a business owner, you may be up for the chaos; after all, you’re enough of a risk-taker to have opened a business. But I want you to think about the rest of your team. Do they like change, or do they prefer stability? Are they quick to adapt, or do they need time to think through decisions?
A flood zone is a type of transition zone that occurs when the level of activity in an organization increases to the point that those inside the company literally feel like there’s a flood. Things are coming at them so fast that they can barely stay above water: more patients, more bills to go out, more payroll to process, and more confusion—all of which can erode performance and make staff feel overwhelmed.
When this happens, the knee-jerk reaction for leaders is to immediately hire more people to help handle all of those increases. However, hiring more people actually creates more activity—new people to onboard, dwindling space, etc.—and the team continues to feel like they are drowning. In a flood zone, the demands on your time to manage people, processes, and profitability leave you very little time to focus on strategy for the future.
The first reaction of the leader should be to slow down and have people evaluate what, exactly, is going on. Instead of hiring more people—which only adds to the complexity of the organization—look at what the company is doing and how it’s doing it, and ask everyone involved if there other systems or processes that can be put into place to reduce the level of confusion and concern.
Eventually, of course, a growing business will need to hire more people to handle the influx of patients. This, in turn, may shift you into another stage of growth and force you through another flood zone. To prepare themselves and their company for that additional growth stage, leaders must:
- Begin the process of communicating the new challenges of the coming stage and get ahead of those challenges before they hit.
- Review some of the current challenges that haven’t truly been resolved and address those issues immediately.
- Recognize that the company is experiencing a flood zone and help your employees understand that growth naturally brings an increase in activity.
- Start putting into place more sophisticated processes that will address that new activity level—and help the company sustain profitability by working smarter, not harder (this approach will also help keep employees engaged and energized rather than driving them out due to frustration and burnout).
A wind tunnel is much different than a flood zone. It requires the organization to let go of methodologies that no longer work and create new ones that do. When I think of a wind tunnel, I imagine holding on for dear life. Unfortunately, resisting the force potentially causes me more harm than simply letting go. “What worked before will continue to work” is a strategy that defies logic, yet we cling to it. Instead of adapting or eliminating things that no longer work, many leaders cling to strategies from the past. Because of the increase in complexity, company leaders must re-evaluate how they are managing the many different aspects of the company and find new ways that will work better. A best practice as you experience a wind tunnel is to tap into the intelligence of your staff and encourage them to explore new, innovative ways of operating that may be a better fit for the size of the organization and the demands placed upon it (i.e., due to the number of employees).
As leaders move into a wind tunnel, they must:
- Begin the process of identifying all the various processes and procedures the company had been using.
- Take the time and energy to articulate what those processes and procedures were in order to capture the intelligence that exists in long-time employees
- Start evaluating all those processes and procedures by asking three critical questions:
- Do we still need all of these processes and procedures? You may think that because you worked hard to create these processes and procedures, they’ll still be effective. I guarantee you that the answer to the first question is “no.”
- Which ones no longer assist us in being successful?
- Which ones do we need, and how do we improve upon them?
A business that isn’t growing is dying. So, go ahead: increase the complexity of your organization by increasing the number of employees. Realize that depending on which stage you are moving in to, you will go through one of these transition zones. You can’t ignore the chaos, but you can begin to understand it, and you can create a language of growth that will help your employees understand what is happening and how you will move through it together.
Amy Lafko founded Cairn Consulting Solutions with the knowledge that you need to grow your people to grow your business. Amy focuses her work on the employee experience that is derived from skilled leaders and aligned teams. Whether through team dynamics sessions, development workshops, or consulting, Amy provides expertise to improve the entire lifecycle of your team. From hiring to engagement, she assists clients in decreasing turnover and increasing productivity and customer satisfaction. Amy earned her MSPT from Ithaca College and her MBA from Loyola University of MD. She is certified in DISC and Driving Forces as well as the 7 Stages of Growth™.