Why cutting the business down to size is a smart growth tactic in tough times, with Brian Timperley, the CEO and co-founder of Turrito Networks
There’s an old adage that says, ‘May you live in interesting times’, and this certainly captures the times that the world lives in today. Pandemic, hybrid working, fluctuating economies, market complexity and instability – these terms also paint the accurate picture of the business world today. Organisations are under pressure to perform, to deliver, to grow. There’s no change in stakeholder vision or corporate strategy just because times are tough, in fact if anything, the focus intensifies. But what if it’s time to consider a change to the typical “growth” mindset? If success lies not in old-school expansion, but rather in “shrinking”?
The challenge is that, for most companies, shrinking has a negative connotation. It implies problems and retraction and risk. This is not the message that the shareholders want to hear, nor one that business wants to share. The thing is, the right kind of shrinking can focus costs and help the business become more effective. So it’s not a sign of failure at all, it’s an intelligent move that can fundamentally change a company’s prospects. But if it helps, maybe frame this approach as a form of business “compression”. Compressing the rubbish and waste out, and reinforcing and strengthening foundational aspects of the business for long-term financial gain.
Most companies tend to suffer from sprawl – unused office space, excess licenses, unnecessary overheads and inefficient processes. It’s easy to lose control of these things, especially during lengthy periods of growth, or to not even realise that they’re there. The compress mindset turns the traditional approach of ‘sell more, get more’ on its head, instead asking the organisation to turn inwards , drawing maximum value from its overheads and expenses.
Remove the large and wasteful office footprint. Organisations should leverage the hybrid working model and invest in smaller, more purposeful offices that give staff a space where they can come together and collaborate on projects and ideas. The value of face-to-face engagements has become increasingly apparent, but with a diverse workforce and limited office interactions, smaller office spaces are a smarter move. These give employees the spaces they need to connect and collaborate, but don’t leave the business paying for costly wasted office space the rest of the time.
This approach can significantly improve business without the need for making knee jerk decisions that impact good people and their livelihoods. Instead of always turning to sales and demanding more output in increasingly uncertain and precarious environments, rather parallel their continued efforts with compression: cutting out the fat to build a leaner and more efficient organisation. Shrinking the company CAPEX frees up space and time, controls the footprint, and allows for recovered spend to instead be focused people, products, skills and solutions.
On the people front, this approach helps the business to put people first. People are the real reason most companies will succeed or fail and should not be a default point of call to shrink, especially in tough times. By removing waste and excess, the business is freeing up resources that can be used to navigate through difficult times and upskill and empower existing employees. To develop skills that are going to become essential to your competitive position over the next few years. It’s a calculated move that helps you enhance your existing headcount while building a business that has futureproof skills, as well as engaged and loyal talent.
Of course, technology plays no small role in the effective compression of the organisation. It is the key ingredient to making this as efficient and relevant as possible. It’s technology that helps the business do more, with less. Technology that has given business the tools it needs to acutely reassess its focus and move online at speed during the pandemic. And it is technology that’s allowing for the organisation to become more resilient and agile through improvements to systems and processes. This is the bridge between the old and new worlds and the reason why the business can adopt a hybrid working model and trust in its long-term ability to succeed.
The future is still uncertain, the markets still complicated and economies still fragile, so this is the perfect time to reassess the business, to compress the waste, to shrink the unnecessary, and to focus on a lean and efficient way of working. This can be achieved with the right technology partners, solutions and focus – because the right technology partners ensure that you are investing into solutions that help you futureproof the business.