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Continued from Previous…… SUM UP – Last Part
We discuss solutions in the major areas of People, Infrastructure, Processes, and Resources, and close this topic.
SOLUTIONS – RESOURCES
The last subject before closing is Resources. There is no denying the fact that adequate resources are needed for growth of any organization. It is also true that growing organizations never have surplus cash because the business and structure expansion is constantly consuming money. Another truth is that the entrepreneur also wishes to enjoy his newfound success and would like to drain resources.
The balance between opposing desires can be achieved through planning and adhering to plan.
Resource allocation priority should be business, everything else should be judged on this basis and decided. Allocating resources to long term projects, system upgradation, new office space, and other such things which do not translate into revenue is counterproductive and should be avoided. Too many small/medium companies suffer because they try to engage in activities which may look glamorous but are useless from business point of view.
Investment on customers is a great idea, but not right in the start, for two reasons. One, the customer is not yet convinced of the new products and will not give as much business as committed. Two, the customer feels more pressure of responsibility when they are dealing with large companies with huge resources. They do not take the same pressure from startups or small companies.
Resources may be generated through various ways. First is reinventing part of income for expansion. This is the easiest and most reliable choice. Two is getting finance lines from banks. This method should be used carefully because receiving is easy but returning is tough. Three is inviting some investor to invest. This is the most devious method because investors would like to have a say in how the business is run and may get into conflict with the entrepreneur or his original vision.
Fiscal discipline and wisdom are more critical than the finance itself.
We have discussed in detail about the challenges and issues faced during scaling up. We have also presented solutions to tackle the challenges.
Following may be considered as the key takeaways from this discussion.
- Scaling up is essential as the business grows
- Scaling up is essential to keep the business growing
- Scaling up may seem complex, but is simple at heart
- Ontime decision making is integral to the process of scaling up
- Scaling up is easier than doing business itself, which needs much more effort
- Scaling up would keep the organization effective, efficient, energetic, growth-oriented, and young forever.
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