Scalability is the ability of a business to expand and grow while maintaining the core business model that generated the initial success. If a business finds success, the next logical step is to grow the business by replicating what worked and open ancillary locations with the same business model. Here are some challenges that you may face when scaling your business.
As a business grows it can be challenging to maintain consistent operational processes that result in consistent quality standards. A great example of quality control through operations is McDonald’s. If you go to any given McDonald’s restaurant you can almost guarantee that the bacon, egg and cheese biscuit will taste the same. It is by design that McDonald’s menu items can be produced by each location with little variation from the original menu item. Strict procedures and instructions are maintained for how to produce each menu item with accuracy. Furthermore, the components of McDonald’s menu items are made in large quantities off premises to ensure that consistent product is distributed to each location. To build an empire with standardization to the max takes time and sustained effort while maintaining control over all aspects of food production. What McDonald’s has done to streamline their operations and remove variation from their final product is commendable. However, a cheeseburger in New York City is different than a cheeseburger in Los Angeles. By removing all the variation from your final product there is no room for creativity. Creativity, gave rise to the initial idea to make quality hamburgers at a reasonable price with high quality ingredients. Creativity and passion is stripped away from the workers that are now forced to follow operating procedures that still work, but lack personalization. Big corporations strip away the fabric of our local communities. Scaling local will allow businesses to personalize products to their unique customer base.
Whenever you attend the grand opening of a store or restaurant you are met with enthusiasm, excitement, and passion. With every additional store front that is added, the levels of these emotions decrease. Welcome to Moe’s! You can demand from your workers a requirement to say or do certain things, but is that genuine? Is every worker at Moe’s really happy to see me every time I step in the door. No. Maintaining culture is about having your employees live the brand. If your employees are selling something that they themselves can not afford or share the wealth, how can they feel passionate about what they are selling? A relationship between a business and its workers needs to present for a culture to maintain its vibrancy. Here is an excerpt from Moe’s website:
From the second you walk into a Moe’s, you’ll notice there’s something different. You actually feel welcomed. Ever since our employees at the first location in Atlanta, GA in the year 2000 shouted “Welcome to Moe’s!” – which probably scared the bejesus out of those first guests – that phrase has embodied our entire culture. Everybody is welcome at Moe’s. Except, of course, fugitives.
The first employees were the passionate ones. These first employees had an opportunity to grow with the company and rise through the ranks with expansion. The employees at the 100th Moe’s are not as passionate about welcoming you to Moe’s. Those employees just know they have to say “Welcome to Moe’s” to keep their job. Workers need to have a closer connection to the profits of our corporations. Corporations are making millions and billions of dollars for shareholders at the expense of workers. By scaling local a corporation can keep the passion of the initial store concept with each new store. Scaling local will give workers an opportunity to grow with the brand and share the fruits of their labor.
Agility and Adaptability
Turning a jet ski is easier than turning a cruise ship. Once a business has scaled, making a change can be difficult or impossible. For businesses, failure to change and adapt results in being forced to shut down operations that are not fit for existing competition. To avoid the pitfalls of over standardization, companies should operate new locations as their own autonomous locations. The competition that businesses face locally is different than the competition that businesses face on a macro-economic level. Relying on an all-encompassing franchise management team can be catastrophic for franchisees. By localizing your franchise locations each location can adapt to find its own place in the local community. Allow a community to mold and shape each of your franchise locations rather than forcing a local community to the way that your franchise operates, is the direction that franchisors should take. Scaling locally allows businesses to form relationships with the people of their community. The next wave of businesses should employ a local mindset that will allow each store to build a local social presence while connecting with the customers surrounding their store.
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