Many care providers, both care home and domiciliary (home care), desire to grow their business. In fact, growth is often seen as the key sign of success. Both directors and business leaders are likely to perceive growth as a validation of their business strategy and a statement of business success. Employees, meanwhile, will be drawn to a growing care business – and the job security and opportunities for career development and advancement that such companies can offer. If you’re exploring how to start a domiciliary care agency and scale effectively, managing growth sustainably is essential.
But the impact of growth on a business is not always positive. Here we take a look at some of these potential ways growth can effect a care business – and what the pitfalls may be.
Diversification and risk management
Growth can be viewed as a way of managing risk. By diversifying service provision – either by offering new services or expanding current provision – any potential decline in one area can be offset in others. For example: homecare services may look to expand into neighbouring areas to increase their delivered hours. Or a 60-bed care home may look to offer specialist nursing care on top of its general nursing provision as a way of maximising capacity. Unless properly planned and resources, however, expanding service provision may impact the quality and consistency of existing care services. It is thus important to ensure your business has the capacity and expertise to expand before those additional services are offered.
Economic incentives
Many shareholder-owned businesses are driven by the need to increase share value, which is most often achieved by increasing revenue and profits to maximise shareholder returns. Growth offers the opportunity to do this. But there is danger here: pursuing shareholder value at all costs can leave other stakeholders – and particularly your most valuable assets, your employees – disengaged and disincentivised. Communicating and sharing the benefits of growth among staff and other stakeholders will promote engagement with and support delivery of growth plans, helping ensure their success.
Shareholders or investors can also come with strict targets for financial performance and return on investment. Care is needed here to ensure that these targets are reasonable and do not push you into a growth-at-any-cost mindset.
Competition and service quality
In most industries, there will several service providers within an area that compete with each other for business. Social care is no exception. At it’s healthiest, competition can drive improvements among market participants, as each endeavours to become the area’s preferred provider. But again, beware the risk: your first priority will always be maintaining the quality and consistency of your service provision, even as you pursue growth and seek to outpace the competition. Because, as author and expert on the nature of thinking, Edward de Bono, said: “companies that focus solely on competition will die; those that focus on value creation will thrive.”
Personal goals
The desire for recognition and financial reward among business owners can often be a driver of growth and success. And there’s nothing wrong with this. Those that do well, deserve their reward. But as with the focus on shareholder benefit mentioned earlier, the danger comes when the benefits of growth are not widely communicated or shared. Ultimately, successful growth is a team sport and, while a good manager should be recognised, so too should the fact that, without their entire team, there would be no growth.
Resources
A growing care business will gain access to more resources. This could be via the recruitment of additional and new job roles to support the company’s growth strategy; it could be utilising consultants to provide specialist expertise and support. It may also be from investment in new equipment, new partnerships, or an injection of investor finance. Ensuring these new resources are aligned with and effectively support the growth strategy is the key point here, so spend quality time working out exactly what you need – and then go out and find it.
Opportunity and change management
Growing a business can bring economies of scale through the consolidation of support services and the rescaling of operations with the aim of improving efficiencies and maximising profits. But through any organisational change, be mindful that all change is personal. Organisational change will most often fail because managers and business leaders fail to understand and act with this truth in mind. It means including people early in on in planning so they feel heard and engaged; it means understanding what drives existing behaviour and what steps are needed to get from here to where you want to be; and is means dealing with sensitively but firmly with barriers to change. Change management is never easy; investing time here will never be wasted.
Pursuing good growth
Growth can be hugely positive and rewarding. It can bring new resources into new areas. It can drive improvement in the quality and consistency of services. It can provide a sense of camaraderie and achievement among your staff team. And of course, it brings financial rewards. If you’re pursuing growth, we say go for it! But do it the right way. Look at the aspects we’ve mentioned here and try to understand how the growth you are seeking will impact services, service users, employees, and other stakeholders, as well as owners and directors. It’s also important to think about you. Are you ready for the added pressures and responsibilities that growth may bring?
We know the social care sector is not an easy place to work in at the moment. But we are here to help. Our expert team has long-standing experience working in the industry and provides straightforward advice, business support, and resources such as policies and procedures to enable you to deliver safe, high-quality care. You just need to ask.
Call W&P on 01305 767104
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