The secret of getting bigger

How do you stay creative and introduce better business procedures as your consultancy grows? Mark Shaw has some advice for expanding firms

The most difficult aspect of running your own design consultancy must be the process of starting up, getting it right and making profit over the first few years, especially if you have salaries or significant rent to cover. The next most difficult aspect is managing the transition from your original structure to a more sophisticated operation that will enable you to build on your initial success and shape up a thriving business that has every chance of surviving over the long term.

One thing’s for sure, if your business isn’t getting bigger it’s likely to become smaller, because none of us can count on things staying the same, especially in the volatile world of design. So how do you manage the growth you’ve worked hard to achieve?

In many ways it’s easier simply to carry on, using your wits and drawing on your creativity and energy to manage your business as you add more employees and clients into your mix. Sooner or later you’ll have to face facts – proper structure and processes are the secret to successfully expanding your bottom-line.

Before going further, it’s worth considering the risks that doing all this throws up. How can you maintain the great atmosphere, the informality that everyone loves, the crazy vibe that sets you apart from the others, and the rock ‘n’ roll attitude that made you want to do it your way in the first place if you’re suddenly making everyone fill in time sheets, control their time on each project and write their own performance contract that gels with the business plan you’re supposed to have written?

The answer is to split the new structure and processes away from the funky stuff that makes you who you are. They can live happily side-by-side. Once the pain of implementing the processes is over, the original vibe will return, stronger and more mature.

If I’ve won your confidence that processes won’t stifle your freedom, let’s see what these processes actually are. In quick summary, the key elements that you will need to consider for your emerging consultancy are: a new business plan outlining your specialities, market position, marketing plan and ambitions, ending with a cashflow forecast for the next 12 and 36 months; a performance contract system that allows each of your employees to write their specific objectives for the next 12 months, linked to your business plan; a budget that predicts what your workload will be over the coming 12 and 24 months, coupled with forecasts that update it every few months; regular management accounts (every two or three months) that show your financial performance; and, finally, a steering group (or board) including trusted advisers with relevant business experience to guide you. You should also get everyone, or at least your creatives, to fill in time sheets to help you make sure your fees are accurate (and your people efficient).

Sounds boring and onerous? It is a bit. The toughest part is establishing these processes, making sure they’re accurate and communicating the value and benefit of them to your cool and funky people who hate anything that sounds vaguely businessy. Once they are clear that these processes are designed to make the business more profitable, which should mean you can pay them all more next year, they should support you. Set a realistic timetable, find some budget to oil the wheels and get your head down. It’ll all be sorted in no time.

As you put these processes in place you will need to decide what to keep and what to leave behind. There is no room for emotion in business, but there is plenty of space for it in your design consultancy.

Some staff may want to leave because they prefer a small consultancy, and this might be a good thing for them and your business. Make sure anyone invaluable is on a long notice period. Others may suddenly expect massive salaries, and you’ll need to discuss their expectations with them so they understand the need to play the long-term game. The rule of thumb is be bold and try not to over-commit, you never know how big this thing is going to get.

Mark Shaw is managing director of Jupiter Design

What you need to grow your business:

• New business plan with cashflow forecasts

• Performance contract system for your staff

• Accurate budget predicting your workloads

• Regular forecasts to revise this as you go along

• Steering group to guide and advise you

• Timesheet system for checking profitability

Why bother?

• It shines a light on your business performance

• It gives you the information you need to make your decisions

• It shares your business goals with everyone in the consultancy

• It will spot a problem before the problem spots you

• It gives you the confidence to plan ahead