This business maturity model exercise helps you gain an understanding of which stage your business is in. Continue reading below to understand how to use this business maturity model exercise.
I have fond memories of my childhood days going along with my father on bicycle rides.
If you were born in the 70s or 80s, do you remember traveling in the small seat on the front handlebar?
Yes.
Sitting in that small seat on the front bar, clinging to the bell, enjoying that sound, and seeing the world for the first time with the warmth and care of a father is a lovely experience.
Every trip on the way back home, the only question I asked my father was, “Appa, how do you remember the routes?”
Appa would say, “Once you become big, you will also remember the routes. Not a big deal.”
But I didn’t want to wait till I became big. I persistently asked the same question.
My father once said,
If you know where you are going, understand where you are, and continue your journey, you will reach the destination.
I don’t know how much I used that advice in my life, but this is a golden word in business. If we understand where we are, it becomes easier to reach our goals.
But how do we understand where our business is and what stage of the growth curve we are in?
This business maturity model exercise helps you gain that understanding. This checklist exercise is customized for small and medium businesses (SMBs), with inputs from domain experts. Thanks to Amrith Lal of KRT & Co on Finance, Ms. Shanmugapriya of Hale Consultants on People, and Selvakumar, Founder of GreatWorks.
Before doing the exercise, let us understand a bit about the stages of business growth.
Just like human beings, a business is also born out of a dream. It takes baby steps, explores with childlike enthusiasm, settles on a direction, grows steadily, and at some point may get stagnant. Then it refreshes itself to grow further, finally finds its purpose, and grows strongly.
Each business takes its own time to grow and reach its full potential. Some businesses peak in 6 years, some in 30 years. There is no comparison here. The process of becoming is more important than the result.
But the ultimate aim is growth. When an organization is not growing, it is failing in its mission. Growth is non-negotiable in business.
So what are all the stages of growth?
The stages are:
- Initial Stage – Level 1
- Managed – Level 2
- Scalable (Capable) – Level 3
- Enterprise – Level 4
Stage 1: Initial
This is the formative stage of the business. Survival is the top priority. Everyone handles things on an ad-hoc basis.
For example, a CEO may go to the bank to deposit a cheque, or a service person may attend sales calls. This is common at this stage of business.
Over time, the organization needs to move beyond this level. Otherwise, it runs the risk of becoming stagnant or extinct.
To move to the next level, the business owner’s responsibility is to focus on bringing in people and processes.
Level 2: Managed
At this stage, the business is managed and self-sustaining, but there are still day-to-day dependencies on the owner.
To move to the next level, some recommended actions are:
- Establishing processes across the organization
- Scheduling regular training for employees
- Focusing on innovation
Level 3: Scalable
Organizations at this level are well set to meet market challenges. It is time to scale up in terms of revenue, market share, and geographic expansion.
To move to the next level, a key recommended action is:
- Connecting the silos across the organization
Level 4: Enterprise
At this level, the organization has found its purpose. Businesses at this stage often become brands.
Staying at the top is always challenging. Competitors are constantly fighting to take your place. Enterprises must continuously innovate to retain their position.
The organization’s purpose moves beyond business objectives and extends into social causes.
Now let us do the exercise.
You can download the Business Maturity Model assessment Excel sheet, which includes an 18-point checklist.
Here is the Step-by-Step Guide
Step 1: Download the Excel sheet and save a local copy.
Step 2: In the Excel sheet, four parameters are listed across functions like Finance, Marketing, Culture, and more. Choose the option that best fits your organization and fill in the “Your Score” column. This is the only editable field; all other cells are locked.
Step 3: After filling it in, check your overall score. Then come back to this page and review the stages of business growth.
Understanding where your business stands is the first step toward moving in the right direction. As my father said, understand where you are, start your journey, and you will reach your destination.
January may be the season for personal transformation, but April is the season for business transformation.
The journey will not be easy. Change is hard to implement and even harder to sustain. But you are not alone. We are here to guide you.
Before leaving this page, comment below on which stage your business is in and what steps you are planning to take to move your organization forward.
Wishing you good luck in this new financial year.
