At 48 employees, you may not have to comply with the FLSA’s requirements of break-time and overtime pay. But at 50 employees you might. Meeting now with an employment attorney can help ensure that when growth happens you stay compliant.
It’s a rare advisor that says they don’t want to grow their business in the next year. But it’s probably just as rare to find one who has scaled their businesses for future growth. While many may be wringing their hands over the fee wars and the impending market crisis that some say lies just beyond the horizon, smart business people would take every opportunity to ready themselves to grow.
By and large, the biggest challenge companies face in getting ready for growth is in personnel. Many companies can’t scale their culture when they grow their business. What is culture? This article from the Harvard Business Review (HBR) defines it as “the underlying beliefs and values that shape an organization.” In fact, personnel is noted as one of the top five challenges of a growing business. The others are regulation, technology, business models, and funding & finance. According to some business experts, “[w]hile the start-up phase tends to attract a lot of attention and focus on entrepreneurship, our findings indicate that key growth challenges tend to take place in later growth phases and over 50 % of challenges are related to scaling requirements/processes and geographical expansion.”
So how can you plan for growth and maintain your culture? Jordana Valencia, author of the HBR article linked above, suggests that companies describe their culture in clear, observable behaviors. She urges companies to shy away from terms that could be interpreted in varying ways like “respect”. Instead, stick with action items like listening skills and timeliness. She also suggests building an online library of learning skills now, rather than waiting until you can see holes in skill sets among employees. Finally, she suggests ensuring managers reinforce target behaviors through formal recognition opportunities.
Aside from culture, regulations and varying laws can impact growth in surprising ways. In the financial advisor field, businesses may think they need only keep tabs on changes to regulations coming from the main bodies like the Securities Exchange Commission, FINRA and the Department of Labor. But as your company grows in personnel, your treatment by state regulators may change too. As this Business News Daily article states “[a]s a business scales up, growing in terms of revenue and employment, they become subject to regulations that might not have applied before.” That article names employee benefits, minimum wage, health care and paid time off as key regulations to watch. It’s also worth noting that as your business grows in the number of employees on your payroll, you may move from state only labor laws to being subject to federal as well as state laws. At 48 employees, you may not have to comply with the Fair Labor Standards Act’s requirements of break-time and overtime pay. But at 50 employees you might. Meeting now with an employment attorney to learn how to set up new software for tracking paychecks and processing benefits can help ensure that when growth happens you stay compliant with federal and state laws.
Similarly, scaling your technology needs to meet increased business is something that works better ahead of time. Some consultants suggest the following critical steps in this process: evaluating your current needs and capabilities and creating a plan; finding the money in your budget now for future needs; invest in specific technology; and identify the staff in charge of technology change or strategically outsource it. In general, they suggest focusing on systems integration. “Companies today don’t run off of a single system -- they may have a dozen or more systems. If those systems don’t work together, they create silos, which in turn multiply communication and management problems…” As to which areas to focus on in technology growth, they suggest the following: customer relations management software (CRM), marketing automation, sales management, accounting, and human resources.
Before leaping into the unknown, we recommend a thorough examination of your plan. Because we are experts in the field, we know the marketplace and know what your existing vendor is capable of offering. Through this examination, we can help you optimize the service you receive.get xpress proposal