Business adolescence or managing the ‘puberty phase’ of your company

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If you have children, you might be familiar with growth spurts. Those create some changes (sometimes very visible) in our offspring and prompt a rush to the department store to purchase new clothing and shoes to match size and shape changes, sometimes just for a few months, for our dear beloved child to look well dressed and wear a civilized outfit (at least we hope so).

Companies are no different. Their growth spurts have symptoms and consequences that might be dismissed for a while until that T-Shirt or pair of sneakers really will no longer fit.

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Many successful companies started in dorms, garages, or in some of the most remote locations you could ever imagine. Now they have a global presence, thousands of employees, and many offices around the world. How a startup gets to become a Google, Microsoft, or Apple is part of the magic and creativity of its core team (usually the creators), as well as about the constant search for improvement as part of its own culture. Most importantly, the success of having managed the transformation of a company during its growing spurts must be achieved via observation, change management, and a lot of good communication.

HBR’s 5 Stages of Business Growth

In a 1983 article from the Harvard Business Review, the authors lay out how many companies pass through very similar growth phases (like in most of our human friends). Yet, companies sometimes jump or mix some of the symptoms and this could create some confusion.

In addition, the management style of the different decision-making levels impacts the way that one can see the symptoms of a change due to a transformation rather than a reaction to a market situation.

The five stages of evolution of a company include its initial existence (stage 1), its survival period (stage 2) and then its success (stage 3). In some cases, there is a stage 4 which is take-off and finally, maturity (stage 5).

From observation and experience, the move from the survival to the success stage is the most significant one that will prove if a company and its management are ready for the final stages of take-off and maturity.

According to the U.S Small Business Administration Statistics published in September 2019 (before COVID-19), 80 percent of created establishments survived their first year in business, but only 50 percent will pass the five year anniversary and only a third will reach 10 years. These statistics can be linked to the five stages of small business growth. One can easily overlay them to see that stage 2 to stage 3 is usually within the 3-5 years of existence depending on the business field and market conditions of the moment.

From Puberty to Success … Sourceability’s Story

What is important about the passage from survival to success (or “puberty-phase”) is that the company’s management (many times the founder or group of founders) have to step out of the day to day business. They need to make a significant decision about continuing or stopping active engagement in the decision making process on behalf of the company. It also comes to a point where functional managers (usually in the field of operations and marketing) have to be taken on board and trusted to take over some of the decisions of the founder(s) to enable the full transformation and reach the next level of success.

One example of applying the pattern of growth spurts to the transformation of a company is Sourceability LLC. In July of 2020, this company will turn five years old. As such, it is at the stage of this “puberty-phase” when the strategy has to be revisited, evaluating if there is a need for pruning any unneeded elements of the initial game plan and reviewing the effectiveness of its structure to provide the right fabric for the next period of global growth.

The Digitalization of the Supply Chain strategy announced in December 2019 by its CEO, Jens Gamperl, fits exactly into moving the company from stage 2 to stage 3: Success.

As an example, the creation of a Corporate Global Marketing and Communication team to support internal and external communication and messaging of its brands and products, show that refocus and adaptation of the strategy is being applied to the company’s core in order to be prepared to sustain growth.

This effort is enhanced with the development of a new mission statement focused on providing customers and partners with products and services that take advantage of the company’s strong background in distribution and logistics, gradually developing and providing online supply and design chain tools to drive incremental revenue and broaden its audience to provide greater stability that, as a consequence, provide resilience to market down-turns.

Mature Companies Need Mature Leaders

The growth spurt signs of businesses are not to be dismissed and it takes trained leaders to recognize when adaptation must come into play, avoiding the trap of staying too long in a situation that does not promote the move to the next development phase of the company. It takes courage and ambition to decide to step back or change the structure of the company, sometimes shedding some talent to be replaced with the right management profile to take the enterprise to the next step.

As such, Souceability is working to prepare itself for the “walk on the coals” and become the adult company that it wants to be.

Follow Sourceability’s progress as it transforms itself into the next stage of success with the Digitalization of the Supply Chain.

To learn more about Sourceability, follow on LinkedIn, Twitter, and Facebook.

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Flavio Stiffan joined the semiconductor industry in 1989 at Motorola in Geneva as system analyst supporting the Distribution Channel. He then moved to Phoenix Arizona to drive global IT projects and expanded his experience into Corporate Account Management and Business Development while leading the Distribution and Partner Channel for Latin America from 1999 till 2003. Upon Flavio’s relocation back to Europe, he has taken several roles in the Distribution account management including leading Freescale EMEA’s relationships with Universities during which he has overseen the coordination and set the stage for the opening of 24 teaching labs and the participation of 59 universities into The Freescale Cup Student Challenge, which he is still supporting today for NXP Semiconductors. Early 2015, he added responsibility for the e-tailer distribution market, leveraging his strong university and education network to drive mass-market branding activities and reinforced his connections by managing the NXP Global Ecosystem program strong of over 370 hardware and software partners. In November 2016, Flavio started Stiffan Consulting with the aim of promoting the linkage between the industry and academia. His consulting services include knowledge transfer activities, market strategy development and digital content creation for companies interested in addressing academia and innovators through management of ecosystem programs, academia relationships and incubators. In addition, he is consulting for Sourceability NA LLC as Vice-President of Global Marketing and Communication since January 2020, supporting the company with the creation of its corporate marketing team and brand evolution to a global digital supply chain leader Flavio holds an equivalency of bachelor’s degree in computer science. During his US tenure, he held the vice chair of the EIDX sub-committee for EDI standards. In 2015, he received a Master Certificate in Marketing Strategy, Branding, Business Management and Related Support services from Cornell University. Flavio currently lives in Munich, Germany with his wife and 2 daughters. He enjoys hiking, photography and cooking when he is not traveling visiting clients, partners, universities or supporting teaching labs.

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