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Is Your Company Growing Too Fast? 14 Red Flags To Watch For

Forbes Coaches Council
POST WRITTEN BY
Expert Panel, Forbes Coaches Council

Every business owner craves instant success and growth. Some are lucky enough to achieve that—but there are downsides to growing too quickly. Keeping up with quality and demand can be a challenge, despite the increasing sales numbers.

That's why we asked the members of Forbes Coaches Council to share some telltale signs that a company is growing too quickly. Here's what they had to say, and why they believe such rapid growth is a negative rather than a positive.

Photos courtesy of the individual members.

1. You're Making Mass Hirings 

Hiring is usually perceived as a positive sign, but beware! Sometimes a major hiring spree indicates a company struggling to keep up with overpromises on delivery or a company that hasn’t strategically planned to hire in alignment with its growth. - Tonya Echols, Vigere

2. New Employees Aren't Aligned With The Culture

A company's corporate culture and values are the soul of the organization in which all employees need to be aligned. A company knows it is growing too fast when newer employees are not given the time to connect to that soul through cultural orientations and events. The company then becomes fragmented and disoriented. - Dan Messinger, Cream of the Crop Leaders 

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3. Employees Are Stressed About The Unpredictability

Growth involves unpredictability, which can stress out employees. Employees who once felt secure and proud of their roles may now feel overworked and unimportant amidst expansion. Utilize this painful phase. Tune into your team. Listen and bond around their needs, ideas and efforts. Model attentiveness that galvanizes their commitment to you. They’ll take on new ownership for ensuring success. - Sharon A. Kuhn, Executive EQ

4. You Haven't Invested In Your Customer Experience

Often I'll see companies that are focused on rapid growth by investing heavily in marketing and branding, but they’ve overlooked designing a customer experience. This usually leads to more clients than they can handle, who in turn get frustrated by the lack of support or less-than-stellar delivery of services. - Racheal Cook, Racheal Cook MBA

5. You're Dealing With Constant 'People Problems'

One clear sign you're growing too fast is when "people problems" are more urgent than "business issues." Clear goals and plans to meet them, clear roles and accountabilities, and relentless focus mark a successful fast-growth business. When people's worries (unclear roles, career paths, promotions, pay fairness) dominate, you've outgrown your foundational infrastructure. People fuel growth! - Sharon Richmond, Richmond Associates Consulting

6. You're Putting Out Daily Fires

Rapid growth entails change, which tends to create friction. That sort of friction tends to manifest in a wide range of symptoms such as quality control issues, customer dissatisfaction as well as internal conflicts. Those symptoms are just that—symptoms. The underlying causes are virtually always within growth and scaling projects that were not planned or not executed properly. - Kamyar Shah, World Consulting Group

7. You're Suffering From Low Efficiency, Morale And Customer Satisfaction

Unmanaged employees lead to poor customer service, frustrated customers, low efficiency and morale. Training and management are key. When employees feel useful and successful, everything changes. Slow is smooth and smooth is fast. Quick growth isn't the answer. - Mike Koenigs, MikeKoenigs.com

8. Operating Expenses Are Gobbling Up Cash Flow

One telltale sign that a company may be growing too fast is when operating expenses consistently outpace cash flow. Many businesses require upfront expenditure to make goods and services before selling to clients. However, when businesses don't have the capital to fulfill the orders coming in, they are likely growing too fast and need to slow down and focus on strategies to build more capacity. - Karan Rhodes, Shockingly Different Leadership

9. There's A Lack Of Good Management Controls

In rapid growth mode, the early indicators of too quick growth include: unhappy customers, inconsistent service delivery, goals of new hires are not tied to key result areas, poor teamwork, spending money without impact analysis and lack of experience in the team to handle the challenges of the company needs. The lack of good management controls leads to poor long-term growth. - Bobbie Goheen, Synthesis Management Group

10. You Don't Respond Quickly Enough To Clients

Nothing frustrates a customer more than a lack of skill and adequate responses to questions or concerns. Your current clients are the main reason you have a business. They need to be treated like gold first. If you are growing quickly, chasing the "new money" and not responding to the people who have already put trust in you then you expect backlash and rebellion. Current clients must come first. - John M. O'Connor, Career Pro Inc.

11. You're Seeing A Lot Of Turnover

One huge red flag is when tenured teammates start to leave. This shows the foundation was not strong enough to build on. Once that happens, it's hard to regain control. The minute you notice this change, pause and regroup with those who got you there. Reassure these founding teammates that you need their leadership and are excited to see what comes next for them and the company. - Miranda VonFricken, Miranda VonFricken Masterminds & Coaching

12. Business Systems Start Crashing

When the rate of growth of a business is too fast, operating processes and systems start failing. They usually weren't designed for higher levels of demand. Mistakes get made, efficiencies get lost and the response to customers slows down. New processes and systems need to be quickly put in place, ones that can be scaled to match rapid growth. - Gabriella Goddard, Brainsparker Leadership Academy

13. You Can't Keep Up With The Growing Size And Volume Of Work

When your company is growing, measure two things: the size of your work and the volume of your work. Larger efforts become more complex, take more people and offer more risk. More volume means more widgets going through your processes. Often you have to change your operating model and processes in order to scale to meet demand. Growing quickly means you have to change very fast. - John Knotts, Crosscutter Enterprises

14. Your Foundation Is Crumbling

Having a solid foundation (clear mission, vision, values, identity) with processes and systems that provide efficiency, continuity and checks and balances are key for healthy growth. The foundation weakens when core messages are diluted. Processes and systems can break down if they are not structured to evolve with the growth, feeling like scrambled chaos. A quick pause to reinforce will stabilize. - Christy Geiger MCC, CPCC, Synergy Strategies Coaching & Training

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