1 Simple Rule: Growth Is a Challenging Journey; Be Well Prepared

Plan early to leverage your team’s competencies.

When your venture enters a growth phase, you will face many challenges, such as expanding production, increasing marketing activities, coping with enhanced customer interactions, and managing more complex financials. However, even if you have the required competencies on your team, those competencies must be well coordinated to facilitate growth. Early planning can help you coordinate the diverse competencies on your team and ensure they are used in the best way for expanding your venture.

Experiment, but not without a plan.

You can experiment with different approaches to find the right way to grow. This approach is fine, but it may not automatically work out. A team with diverse competencies and—importantly—a plan is also required for success. A plan helps you coordinate your teams’ competencies and the information generated from your various growth experiments. Try to develop all three—experimentation, team knowledge diversity, and an early plan—in parallel to maximize your venture’s growth.

Adopt an entrepreneurial strategic posture.

Particularly in environments where technologies and customer demands change quickly, ventures with an entrepreneurial strategic posture often grow more quickly than those that do not have such a posture. An entrepreneurial strategic posture is proactive, risk-taking, and innovative. If you integrate these three principles into your strategic decision-making, you may outgrow your competitors quickly.

Be aware that you will need a lot of resources, and be creative when accessing them.

Growth is resource-intensive. To grow successfully, it would be best to build new production plants, acquire new talent, expand your marketing activities, and build new distribution channels. The good news is, however, that you may not need to do all these things by yourself. A strategic alliance can help you access some of these resources. Allying with large companies can provide access to their marketing and distribution capabilities, saving resources and enhancing success on your growth trajectory. Joining forces with other ventures to set up a new production facility or a research and development facility can save you money and provide access to talent. Identify such possibilities upfront to allocate your venture’s growth resources most efficiently.

2 Simple Rule: Transform Your Venture Multiple Times

When creativity does not move your venture forward anymore, select a leader.

In the early phase, you may feel excited that everyone in your venture can work on the tasks they like and be creative in executing them. Coordination is informal, and communication is frequent. However, a creativity-driven approach becomes challenging as you take on more employees. Not everyone can coordinate and communicate with everyone else anymore, leading to double work and inefficiencies. To overcome this situation, select a leader (yourself or someone else) who assigns clear responsibilities to venture members, introduces new communication channels and business processes, and allocates resources. These practices can provide the way into the next growth phase.

If you feel overwhelmed, foster delegation.

Although you may take your venture to a new level with further growth, it is likely that over time, you will become overwhelmed by the complexity and multitude of decisions you have to make. In addition, people in lower-level managerial positions who emerged as a growth consequence may feel frustrated by the need to coordinate their decisions with you. These people may ultimately leave your venture. To overcome this situation, establish delegation structures and empower lower-level managers for further growth.

When your venture becomes too complex, formalize your systems.

To grow your venture, you may have added increasingly more products, entered diverse markets, created multiple units within the venture, and provided individualized incentives. All this creates complexity, making it difficult to oversee your venture. Therefore, at this point, your organization should be formalized. This means that you may combine and/or merge some products and units, reassess whether all markets served are worth the effort or if focusing on the most profitable ones is a better solution, and introduce a formal incentive system that applies across the organization. This may also include expanding the central administration at your company’s headquarters.

To keep venture units entrepreneurial, spin them off.

Some units within ventures, like startups, may need creativity when developing highly innovative technologies or products. Consider giving them autonomy. They can become independent ventures with you retaining a major stake, or they can be ventures within your firm, for example, centers of excellence with high decision latitude and the possibility to do business their way.

3 Simple Rule: Build Your Cultural Intelligence to Enter Foreign Markets

Recognize that doing business in other countries is common for entrepreneurs.

With internet platforms and other communication mechanisms, many entrepreneurial firms target international customers and obtain supplies from international sources. Some new ventures are created with international markets in mind and are born global. Be open to taking your business to other countries.

Build your cultural intelligence.

Cultural intelligence means you can distinguish someone’s behavior by categorizing it as distinctive to that person, consistent with a particular national culture, or something that all people do. Correctly making these categorizations helps you better understand the person you are dealing with. It can also help you understand when knowledge about interactions with a person is transferable to others from the same culture and when such generalizations are inappropriate.

Use your head to build cultural intelligence.

You can build your cultural intelligence by thinking about people’s behavior. You can suspend judgment when assessing someone’s behavior to determine if it is cultural or idiosyncratic. You can improve your thinking by role-playing activities to learn about cultural activities. You can also use other learning strategies to learn about other cultures, such as reading books and watching instructional videos.

Use your body to build cultural intelligence.

You can build cultural intelligence by adopting some of the habits of the culture you want to learn about. This adoption can help you understand and generate trust with people from that culture. Don’t go too far in imitating certain behaviors—it may come across as mocking them and/or as being inauthentic. Stay within the bounds of your authenticity and make minor changes to your habits to reflect the cultural context.

Use your heart to build cultural intelligence.

You can build cultural intelligence by being motivated to better prepare for cross-cultural interactions. Also, you can build self-efficacy by succeeding in initial cross-cultural interactions. Cultural self-efficacy means that you believe you can be successful at cross-control interactions, enabling you to persevere in such situations and achieve success. To build this self-efficacy, engage in a few minor activities that will give you a chance to be successful—to have a few small wins. Then, you can build toward greater cross-cultural challenges.

Use your network to build cultural intelligence.

Search your network to determine if you know people from the focal culture. These people may provide you with critical information about the culture. They may also provide an ideal opportunity for cross-cultural role-play in a psychologically safe environment—an excellent opportunity to learn at a low cost of failure.

To learn a culture, immerse yourself in it.

Immersion requires your head, heart, and body to thoroughly and actively understand your environment. Take away your cultural support from home and dive into the new culture. Experts say the best way to learn a language is to immerse yourself in a context where only that language is used. You have no choice but to learn.

4 Simple Rule: To Make Your Organization Entrepreneurial, Enhance Its Capacity to Learn

Learn from feedback to adapt.

When facing a dynamic environment, your venture’s initial alignment with the environment can be lost—your approach is likely consistent with the past but not the present conditions. You can’t anticipate all the environmental changes in advance. Still, you can try to notice them when they happen, learn from your venture’s outcomes in this new environment, and respond by adapting the venture to be aligned with the environment again. This adaption requires you and your venture to learn from feedback from the venture’s actions. Be open to feedback about conditions that have changed.

Focus on learning for venture dynamism.

A dynamic capability is a capability that can change a venture’s routines and systems. Learning is the ultimate dynamic capability. By learning from your venture’s actions, you can change your capabilities to regain alignment with the environment, which will in turn be reflected in enhanced venture performance. Therefore, learning is a capability that can help drive changes in existing capabilities and the development of new capabilities.

Offer psychological safety.

Psychological safety is an attribute of a venture’s climate that allows members to share information, including novel ideas, without being denigrated by others. This information-sharing among venture members is critical to creating new knowledge and spreading excellence throughout an organization. Psychological safety is paramount in learning from failure. When you feel psychologically safe to share information about your contribution to a failed project, you and others can learn from that failure. However, when psychological safety is lacking, people will hide mistakes and failures, and important sources of learning are wasted.

Recruit and promote diversity.

Diverse venture members can provide different sources of information and perspectives on the same event or task. Encouraging this diversity provides greater scope for your venture to learn and can thus improve creativity and innovation.

Schedule some pauses so you have a chance to reflect.

Entrepreneurs often move quickly. Speed is good. However, occasionally, you need to pause and reflect on what has happened to give your brain a chance to catch up and learn. Learning is not automatic or instantaneous. You may move quickly in the wrong direction without pausing to allow for reflection. Reflection is necessary for course corrections.

5 Simple Rule: Formalize Some of Your Personality to Build Your Venture’s Culture

Use your personality to build your venture’s culture.

A culture for a venture is critical for managing members to ensure they have shared values, beliefs, and assumptions that generate organizational behaviors. While established ventures have an organizational culture, you must build and establish one when you create a new venture. That organizational culture will likely reflect your personality as an entrepreneur because the venture is created to fulfill your goals and desires.

Provide a clear vision.

A vision conceptualizes what you want your venture to look like. Communicating this vision within the venture is essential because it ensures that all members adopt the same values, providing purpose to their activities. With shared values and an understanding of the venture’s purpose, venture members can cooperate, coordinate, and collectively generate superior decisions, learning, and performance.

Tell stories, highlight artifacts, and document systems.

While your personality can influence venture members’ behaviors, you need to establish a culture that can work for an extended period and as your venture grows. You can convert your personality to an organizational culture by articulating the values, beliefs, and assumptions that underlie your venture. Once the organizational culture has been articulated, you can start codifying it. Codification means documenting the aspects of the organizational culture. For example, some entrepreneurs write about their organizational culture as a manifesto. For the culture to work, it needs to be shared by all members. Such sharing can be facilitated by telling stories and displaying artifacts and other symbols that reflect the culture.

Recruit and train the “right” people to fit the venture’s culture.

You can maintain the organizational culture as your venture grows by recruiting the right people. By “right,” we mean people who fit with the current organizational culture or people you are confident are willing to adopt it. Whether for recruits or established members, it is essential that your training involves reinforcing the organizational culture, such as telling stories and highlighting artifacts that reflect the venture’s underlying values, beliefs, and assumptions.

Recognize that your venture’s culture can be a source of competitive advantage.

A strong and widely shared organizational culture can give your venture several competitive advantages. Your venture’s culture is unique because it is based on your personality and has evolved based on the venture’s various encounters. This uniqueness makes the organizational culture a source of competitive advantage that is difficult for others to imitate.

Build your venture’s culture in conjunction with organizational capabilities.

While an organizational culture can provide numerous benefits to a venture, the venture must be able to back it up. A venture with a culture but no capabilities is like having the sizzle without the steak.

Don’t outgrow your venture’s culture.

You may desire your venture to grow as rapidly as possible, but rapid growth has some dangers. Often, growth is enabled by a venture’s organizational culture. However, growth can stretch the organizational culture too far such that the venture loses its “essence.” Recognizing the limits of your organizational culture and the strains growth puts on it is essential. It may be wise to grow only as fast as your ability to maintain your venture’s culture.