Fast Growing Companies – Challenges and Solutions

Fast Growing Companies – Challenges and Solutions

By: Steve Y. Lehrer, CPA

As your business begins to grow, your risks may begin to grow and evolve.  Investors and stakeholders will be comforted knowing that you understand the new risks and challenges facing your business, and that you have them under control.  Risks may manifest and change in a variety of ways.  Your future success will be driven by the way your business deals with these risks and challenges.

In order to identify and mitigate these risks, FGCs need to build the right foundation comprising of plans, objectives, policies, processes and performance indicators that can help the company fast track its growth in a stable manner. Rapid growth can be very challenging.  A major reason why fast-growing companies struggle is their inability to keep up with the many tasks required to facilitate such rapid expansion. 

Common performance challenges may include:

  • Lack of proper business planning
  • Unclear objectives and priorities leading to “Management by fire fighting”
  • Ad-hoc policies and processes
  • Cash Flow Management constraints
  • Lack of clear insight into business performance and profitability
  • Inadequate systems and controls

Here are some objectives that should be set by the owners and respective management, and monitored to ensure a healthy and productive growth:

 Administrative

  • A clearly defined mission, which is documented and conveyed to all employees
  • A written sales plan with an identified niche, pricing policy and targeted customers
  • An annual budget that is realistic and flexible, and is compared to actual results
  • Clear and concise job descriptions, employee training and ongoing evaluation

 Operational

  • A good relationship with suppliers and adequate contingency plans
  • A supply chain process with adequate inventory controls
  • Staying current with technological advances and safeguard assets / IT data
  • Knowledge of the industry, business, competitors and their locations
  • Documented policies and procedures and adequate internal controls
  • Focus on customer needs and conduct satisfaction surveys
  • Utilize effective advertising campaigns and participate in promotional events

 Financial

  • Accurate and timely accounting records and financial statements
  • Reconciled bank statements and balance sheet accounts monthly
  • Analyzed results of income and expenses
  • Timely and accurate tax filings and other regulatory requirements
  • Projected cash flow needs and proper financial planning

Parkview Risk Advisors (www.parkviewconsult.com)

About these ads

About Governance Advisor

I am a CPA with 20 years of experience. My skills are rooted in Corporate Governance, Reporting, Financial and Internal Audit, Enterprise Risk Management, Process Reengineering, Sarbanes-Oxley, SEC and Regulatory compliance.
This entry was posted in Uncategorized. Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s