Northern
Australia
Business
Development
Transformation
Grant

What is business transformation?

Business transformation is a process of changing a business's structure and operations to better align it with market expectations.
Why does every business need to transform? Transforming a business is necessary for three reasons:
i) because the market has evolved in an unpredicted way, requiring new skills and competencies from its workforce - think social media, globalization, increased sophistication of consumers...
ii) the outside forces change the needs of your stakeholders -- this can be from regulation or competition. The result may be that today’s business model no longer delivers sustainable profitability to your partners or shareholders
iii) a competitor emerges who does not play by yesterday’s rules.

 

What is digital transformation?

Digital transformation is the process of taking traditional business operations and recasting them into an expanded, more technologically informed way of operating. The result is a company that's agile, focused on data-driven decisions, open to customer-centric innovations, and ready to take advantage of emerging technologies like artificial intelligence.

Digital transformation initiates comprehensive changes within organizations so they can respond better to client needs in their marketplace space or industry by leveraging technology tools and exploring new avenues for generating additional revenue. Initiatives can involve organizational strategy; marketing; mobile solutions; branding; financial services; customer service; operations (supply chain management); analytics/big data/business intelligence (BI); information technology (IT) governance and innovation.

 

What does scaling up mean in the context of entrepreneurship?

Scaling up means to increase production, growth and scale. It refers to the activities related to expanding a company's size so that it becomes better suited for handling increased customer demand. More simply put, scaling up is about making big plans because somebody else can act on them.

There are many aspects of the entrepreneurial process that must be scaled up in order to grow one's business; product or service production, marketing campaigns (reaching more people), targeting larger markets (through diversification). There must also be an effort to maintain quality levels while scaling up by increasing oversight and taking time for team meetings/training sessions.

All of these things happen alongside appropriate changes in management style, longer work hours and accommodating shareholders by securing continued financing or venture capital.

Scaling up is particularly important in the early stages of a startup, but it does not stop once the company is established. Staying on top of scaling up generally requires effort and discipline, because it can be easy to become complacent.

 

What are the characteristics of a scalable business?

Scalable businesses operate within an ecosystem of exponential customer feedback loops. These loops create information that allows the company to grow faster as they develop a better understanding of their product/market fit. A scalable business grows revenue, it's growth is not constrained by outside forces or conditions, and its ability to leverage economies of scale provide for a cost advantage over competitors. When these three characteristics are present in a company, you have a scalable business!

 

What are the biggest challenges in scaling a business?

The biggest challenges in scaling a business can be broken down into four broad categories: growing pains, challenges when scaling, cash flow and team members.

Growing Pains: The best example of this is the struggle to keep up with demand. The moment you appear in mass media and word-of-mouth spreads like wildfire, the environment changes radically. Suddenly people who were never even aware of your existence are contacting you for work or requesting that you attend their event. These requests need to be accommodated but it sometimes takes away from what is already happening in your regular routine, leading to disruptions in how things typically run at the company level and causing some anxiety related to how these requests will continue flooding through the system after this initial surge of interest has passed.

Another growing pain is suffering from growing pains (see what I did there?). As your team grows, it becomes harder to keep everybody on the same page and moving in the same direction. You need to scale up your leadership skills or be able to delegate important tasks to others who are taking on more responsibility. Not growing with your growing company can lead to growing pains.

Scaling: Scaling is the act of growing your company beyond it's current state, without growing pains. The moment you hire your first employee there are new rules to follow enforced by the government that may not have applied when you were working independently or just with freelancers. It can be an expensive and difficult process in the beginning but well worth it

Cash Flow: One of the top reasons businesses fail is because they are unable to keep up with cash flow, especially when growing pains are met with growing demand. The biggest growing pain in this situation is that you are not prepared for growth and need more time to scale your business or hire more people before growing too fast and running out of money

Team Members: If growing pains is met with growing demand then cash flow is not sufficient to meet that growing demand. Growing your team members will help ease the growing pains caused by growing demand but great employees are hard to find even when you don't have growing pains. Retaining good people can be challenging sometimes but it will always be worth it

Conclusion: The best advice is to plan ahead, which will prevent growing pain from growing into growing demand. If you can identify growing pains as they're happening then you'll know how to implement the proper plan of action to scale up your business properly and financially responsibly.