How to Achieve Sustainable Growth

A typical misunderstanding of business growth is that it only happens through additional work, time, and effort, and for an already busy firm leader, this can seem like the last priority.

But, sustainable growth can be very different. Sustainable growth involves planning strategically and ahead of time so that you have the right resources to achieve your business goals, without reacting too quickly that you occur an overhead.

The following three elements should assist you in developing the resources required for the sustainable growth of your firm:

1. Increasing profit

Firstly, it is necessary to differentiate between profit and revenue. Revenue is the total amount of income generated from your services, whilst profit is what remains after all expenses and debts are deducted. A profit margin between 10 – 20% is acceptable for a healthy architecture firm.

We often find that when revenue increases, so do expenses, meaning that profit remains the same. This is often frustrating, as you are working hard with no substantial gain.

Increasing profit ultimately comes from widening the gap between expenses and revenue. To lower expenses, firms can seek to eliminate unnecessary expenditures and improve operational efficiency. On the other hand, firms can seek to increase revenue by developing effective marketing and business development strategies that help bring in an increased number of better projects and clients.

2. Expanding team size

Increasing team numbers often feels like a daunting task to firm leaders as it means more staff to manage and increased pressure to consistently bring in new work.

However, investing in the right people, with the right expertise, at the right time can drastically improve the functionality of your business and facilitate growth. This involves recruiting people that are specifically suitable and well trained in their area of expertise.

Additionally, having a slightly larger firm means you are less disrupted by events out of your control, such as a stalled project or an employee’s decision to leave. Generally, firms under five tend to scramble when these events occur, whereas larger firms with more available resources tend to be more stable during challenging times.

3. Improving and enhancing skills

Team members and leaders at all levels always have the potential to improve and become better at what they do. Investing in professional development is important as it gives your team a chance to gain skills that can facilitate and improve your business. For example, perhaps invest in leadership or business management, given these skills are not typically taught at design school.

Finally, ensure that you as a firm leader, model a culture of growth and development so that your team knows what to expect. Focus on changing unproductive processes, and ensure you have someone to hold you accountable!

It can often feel counter-intuitive to focus on growth when you are struggling with the responsibilities of owning a small design firm, however investing in sustained growth can indeed be what you need to uncover a new life cycle of your firm, where you feel more in control and ready to achieve your business goals.