The Balanced Business

John Gorzak, Vice President

John Gorzak

Businesses, especially smaller private companies, tend to experience performance plateaus over their life cycles. Often, these plateaus are triggered by growth.

Such growth spurts typically lead to an expansion in the ranks of management, along with a redefining of roles and responsibilities among the executives and founders who have been with the firm the longest. At the same time, owners may also feel pressured to delegate more and incorporate better tools for evaluating production and financial management. However, they may find it hard to let go or figure out how to implement them. Meanwhile, existing scorecards and other means of measuring performance can break down as communication among the new layers of management compromise preexisting checks and balances.

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In the end, the amount of change needed, and determining its nature and how best to implement it, can lead to stalled growth.

Fortunately, as growth starts to stall it produces symptoms. If management knows to be on the lookout for these early warning signs, they can proactively address them and their underlying causes to bring the business back into balance before any sustained damage can occur.

Resources for Counteracting Stalled Growth

Among the most effective ways of spotting and counteracting the symptoms of stalled growth is to seek perspective and actionable advice by joining groups of business people in different stages of facing similar issues.

In this area, Vistage, Young Presidents’ Organization (YPO), Executive Forums and local trade groups, like the Technology and Manufacturing Association and the Valley Industrial Association, are all good options. In fact, many of our customers have found these organizations’ forums have enabled them keep their growing companies on track.
OSB-0052_Gorzak-Sidebar2Another effective means of protecting the financial balance of your firm while enjoying revenue growth is to establish a framework of standards to gauge performance and the effectiveness of internal communications. There are many resources to choose from, but our clients have found the books listed in the accompanying box to be particularly impactful in the areas of:

  • Improving communication
  • Effectively delegating
  • Learning to measure the right things
  • Incorporating the flexibility to keep modifying

In addition to these resources, the commercial bankers at Old Second also stand ready to help you spot the early warning signs of stalled growth and address them. With a range of cash management tools and credit structures, we can work with you to maintain balanced growth in your business.

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