It takes time, energy, and an abundance of resources to grow your business… so you might as well do it the right way. And in a world where most entrepreneurs pursue growth for growth’s sake, an intentional and lean approach will serve you well.
What is a Lean Business?
In a world of bloated businesses that frivolously waste resources and focus their energy and efforts on the wrong things, a lean business is refreshing.
“Simply stated, a lean business is a business that maximizes value while minimizing waste,” Planview explains. “A lean business model focuses on improving processes across the value stream in order to eliminate waste and deliver optimized value to the customer.”
Every lean business has its own unique approach, but they all tend to observe a fairly consistent set of principles. This includes:
- Resource maximization. A lean business does more with less. Every resource is fully maximized and channeled in such a way that it feeds the whole. There are no wasted pockets or leaky holes – everything is perfectly optimized with clear objectives in mind.
- Waste elimination. Part of being a lean business is eliminating as much waste as possible. This means ruthlessly destroying any activity that doesn’t produce value for the customer.
- Scalability. Lean businesses don’t put the cart before the horse. They’re smart about resources and allergic to bloat. Yet at the same time, they have the systems in place to scale at ease. This allows them to grow efficiently without ever getting stuck in a compromising situation.
- Quality-first. Lean businesses aren’t necessarily cheap businesses. Quality is a primary focus. The idea is that quality breeds customer loyalty, which reduces the pressure on customer acquisition and maximizes marketing and ad spend.
- Deferred commitment. Lean businesses aren’t flaky, but they are hesitant to make long-term commitments. Instead, they adopt a “just-in-time” approach that enables them to nimbly make decisions on the fly (based on the most relevant information).
If you focus on these five principles, you can transform any bloated business into a lean company that’s able to grow with efficiency and ease.
4 Tips for Lean Growth
Not sure how to kickstart your lean transformation? Here are a few simple tips you can use to get things moving in a positive direction.
1. Outsource as Much as Possible
Hiring a full-time employee is expensive. In addition to salary costs, you also have to account for recruiting expenses, benefits, bonuses, and other administrative costs. You’re making a commitment, which sort of boxes you in and forces you to go in a particular direction. But the good news is that there are alternative approaches. Outsourcing is one of them.
Outsourcing shouldn’t be viewed as a fallback plan. Instead, you want to look at it as the plan. Take advertising and marketing for example. By outsourcing to a company like EAG Advertising & Marketing, you can benefit from world-class customer acquisition strategies without wasting money on ancillary expenses. This also makes you more scalable, as you can add and subtract contractors as your needs change.
2. Learn to Say This Word
Serious about being lean? You’ll have to fall in love with the word “no.” As a business owner, you get opportunities thrown at you left and right. And while many of them sound enticing, they can actually produce unnecessary friction within your business by complicating systems and processes. Being bold enough to say no to something that could generate revenue in order to stay lean and wait for superior opportunities is difficult. But if you perfect this discipline, you’ll do just fine.
3. Embrace Automation
Automation is the key to efficient business operations. And with significant advances in artificial intelligence (AI) and machine learning (ML) over the past couple of years, it’s more practical than ever before.
Embrace automation in areas of your business that are time-consuming and/or have a direct impact on the bottom line (whether it’s expense or revenue related). Time equals money. Your ability to save one of these variables dramatically impacts the other.
4. Standardize Processes
This step sort of goes hand in hand with the previous idea of automation. Lean businesses find something that works and then they figure out how to make it as frictionless and repeatable as possible. They do this by creating standard operating procedures that are documented and then handed over to outsourced partners.
Grow Your Business With Purpose
Growing a business the lean way requires purpose and intention. There are no shortcuts or hacks. You have to put in the work and plan ahead, so that your business can successfully maximize resources, eliminate waste, and enjoy optimum scalability.