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Unplanned growth poses business risk, says Epicor

Nine in ten organisations exposed to risk due to unplanned growth in 2015, according to survey

Unplanned growth poses business risk, says Epicor
Improperly managed growth can cause business risk due to failure to meet customer expectations or because IT failed to manage expanded operations.

Nine out of ten organisations struggled with unplanned growth in 2015, according to a global survey conducted on behalf of Epicor.

The survey of 1800 business leaders found that 89% experienced exposure to significant business dangers because growth was either unexpected or did not match expectations.

The main concerns cited by survey respondents of the risk of improperly managed growth included loss of customer intimacy, followed by excessive pressure on operations, damaging quality and customer satisfaction and concerns that their business IT systems may prove unable to cope with managing a larger, more complex, business model. Fifty-eight percent of respondents said their businesses grew in 2011, but only 11% said the growth was in line with expectations.

Growth also poses a number of concerns about resource availability as business activities scale. Forty-five percent of business leaders said that as a result of growth, they worry that their business might take on large or complex projects that they lack the skillset and technology to deliver effectively, damaging their brand reputation. They were also concerned that by growing the business, workloads may increase to a level that places too much pressure on staff, prompting key personnel to leave the organisation (43%). Just under half (45%) of business leaders polled worry they are not personally prepared for the challenges of managing a larger, more diverse business.

Globally, significant levels of unplanned growth were more likely to be experienced by mid-sized businesses with 100-999 employees (37%), than larger enterprises with over 1,000 employees (29%).  Unplanned growth can bring challenges and pitfalls which nearly three quarters of businesses agreed are of at least some concern to them. Growth was most likely to be described as painful (in as many as one in ten cases) by smaller mid-sized businesses (100-249 staff) as they make the difficult transition from small to mid-sized enterprise.

In the light of this it is not surprising that business leaders across the globe found growth to be difficult as well as rewarding, suggesting businesses across the globe need to prepare for growth more effectively.  Nearly half (45%) admitted that they found growth challenging in 2015.

To support business growth, and prepare for its challenges better, 79 percent of businesses believe that an effective and integrated IT infrastructure is essential. "This adoption of new technologies should position organisations to reap the benefits of newfound efficiencies and pave the way for growth," said Malcolm Fox, vice president, product marketing, Epicor.

"Although the majority of businesses intend to grow in 2016, it's clear that there are significant concerns with regard to businesses ability to deal with growth," said Fox. "These concerns are not altogether unfounded, as our research shows even when businesses plan to grow, this growth can still surprise them; putting unexpected pressures on the organization. The proper time to prepare for growth surges is well in advance, as having an information framework to enable an organization to respond and keep pace in the face of growth has never been more vital."

To help manufacturing businesses plan growth better Epicor has released a new eBook that outlines the key success factors that manufacturers believe contribute to their growth.

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