Growing Pains: The Challenges That Come With Expansion
Growth makes sense, after all. Fierce competition means margins are tight, which means the benefits from being a large company can reduce costs (like spreading “overhead” costs across more field employees) and help win business. Scale opens up new customer opportunities. Moreover, growth means your best-performing supervisors will have promotion opportunities inside your company instead of somewhere else.
While there are clear benefits to growth, it hardly means growth is easy. We have found that there are three main challenges when facilities services companies grow.
Challenge #1: Less Time for Existing Contracts
Tomorrow’s growth will not get you far if today’s customers drop. With only 24 hours in a day, you may defer some priorities as you pursue new customers. Even with sales teams and excellent site-level management, executives pursuing growth must find a way to balance chasing new business and satisfying today’s customers. That becomes even more difficult when a growing company wins new business and needs to deliver ASAP.
However, executives who proactively manage their calendars, dedicating time to check in on existing contracts, find they can manage.
Challenge #2: Frontline Staff Growth
Finding workers and supervisors is not easy. In unionized environments, cleaners often remain with their buildings—which means the new contractor just needs to bring in quality supervisors. In non-union environments, finding quality staff, given today’s extremely tight labor market, is a massive time drain.
We find that frontline staff growth is top-of-mind for executives. So much so that it has become cliché: “Other than the labor shortage, how’s your business?”
Challenge #3: Back Office Growth
Back-office staff and processes cannot grow in proportion to the front line. After all, the benefit of scale is reducing overhead costs as you grow.
Consider which frontline tasks will affect the back office. Categorize tasks into three buckets as you add more employees and contracts:
- Tasks that get easier (e.g., finding prospective business)
- Tasks that get proportionally more difficult, time-consuming and complicated (e.g., onboarding new employees)
- Tasks that get exponentially more difficult, time-consuming and complicated (e.g., managing employee/contract schedules)
After you have categorized the issues, ask yourself, “When do we hire someone new?” You may also ask, “When do we decide to invest in technology instead of hiring new people?”
Consider what methods you are using for simple administrative tasks and what their outcomes are. Also, consider potential problems you might face when something interrupts these tasks (for whatever reason). What happens when something happens to the payroll, or when employees go on vacation? How is data about staff compiled and kept?
Develop a plan to take advantage of growth and thoughtfully reduce back-office costs, rather than putting out back-office fires as they arise. Decide which tasks technology can streamline and determine where employees can spend their time better.
Look to Tomorrow Today
It is important to remember that some of the tasks that get proportionally and exponentially more difficult with scale may not be your biggest time drains today—but they will be tomorrow. This does not have to be the case, however. Investing in technologies and processes can turn exponential and proportional tasks into tasks that are easier with scale. Facilities services companies are wise to consider these investments sooner rather than later.
Rahkeem Morris is a co-founder and CEO of SYRG. Before Cornell, Google and Harvard Business School, Rahkeem was a high school dropout who balanced multiple part-time jobs (working 13 in total) over nine years to make ends meet. SYRG was borne of his personal experience.