The Challenges of Growing a Business

Transcript

Karen Kirton 

As business owners, we genuinely have a goal of growing our businesses and making it scalable. But growth isn't always what we need. And I know I've met business owners over the years who did scale and grow and then they decided that it actually wasn't for them and they sold or shut down their businesses. Sometimes they started again with something completely else. And mostly this came down to a loss of control which can lead to quality issues, but also sometimes just giving up some control to enable others to invest in the business because they needed that funding required for growth. There's complexity with managing teams of people cashflow debt issues. So joining us today to discuss business growth, including the challenges is Darrel King, who's the founder and CEO of Paula seven. And polar seven is a consulting and managed services organization, which takes our customers on a cloud journey. So migrating from a data center to cloud platform and then helping them manage and operate their environments. They keep long term relationships with their clients. Most of their clients have been with them for more than five years. And they also help them with their modernization phase, such as data and analytics services, serverless or containers. So thanks for joining us today, Darryl.

Darrell King 

No problem Karen Lachy thanks for having me.

Karen Kirton 

And looking I have been discussing through the series different facets of growth for business owners, and I'd love to hear your story darlin if you think there is still more advantages and disadvantages to business growth.

Darrell King 

Okay, at the end of the day, I think there's always more advantages to business growth than disadvantages, but it's you know, growing your businesses is fun, and it's an interesting journey. When I started the business in 2013, I'm not sure I realized just how much fun it would be and when I say fun, I mean, probably more interesting challenges to be found along the way. There's always a lot of things to learn and lots of challenges along the way to overcome for example, like finding the right people at the right points of the journey. You know, that old saying, you're driving a bus and you want the right people in the right seats. Cash flow is always a challenge. You know, when you think about funding, do you bootstrap it yourself? Or do you go out and seek investments and then obviously, having the cash itself to fund that growth, and then deciding to either take that money from externally or organically grow with bootstrapping, so it's finding your superpower for one to a better word or your unique unique selling position is all was an interesting thing to discover and uncover along the way.

Karen Kirton 

So when you started in 2013, was that just you like can you take us through what that growth has looked like? Over the almost 10 years? Congratulations.

Darrell King 

Yeah, thank you. Yeah, it was pretty much just me when I started this basically a blank sheet of paper. Amazon Web Services, which is the platform was new, relatively new at the time. You know, their first service came out in 2006. I think there was one perfect person working for Amazon in Sydney at the time. Now there's 1000s. And yeah, we started you know, with project focused model. And what that means is it was you know, bring on consultants, you'd win the business, you'd outline what the project was going to be and then you deliver the project. So it was a boom and bust type consulting and project model. And over the years, then probably about five or six years in we decided to change that and add managed services, which is a different model. Where are you consistently engaged in keep your customers and help them manage their business as usual operations.

Lachy Gray 

How did you find that transition going from, I guess that more traditional project model as you said, more is that more of a subscription model that you have now?

Darrell King 

Well, it's a recurring revenue model. So is it a subscription? Yeah, it's probably similar. But it's a recurring revenue model, which means that the enables you to you know, help grow the business and bring on more people because you've got you know, you know what, there's cash coming in the following month. But yeah, it's the transition. It probably wasn't a transition. It was more of, we've still continued to do the consulting and projects, and now we built another business unit within it. So we basically have two business units within the business.

Lachy Gray 

Yeah. Okay. And did that. Did that change your perspective on on funding as to whether you would stay bootstrapped or whether you would look for investment?

Darrell King 

Yes, I think I think it will. It will long term, I guess it's given the, you know, the ability to sleep better at night, I guess. You know, I still ask customers you know, what keeps you awake at night? And it's always interesting to see the response to that. Why use keep me awake at night when you had the boom and bust of projects is that you know, you could be you could be rich one month and poor the next but you had to balance that out over the years. So it's, it's interesting, and I think having having added the second business unit has just made that that easier.

Lachy Gray 

What has been some of the upsides to growth for you at pala seven?

Darrell King  1

Well, being small has its advantage where you can be nimble and agile. Where you can key you know, you can go in and meet a customer you can start a project and you can provide feedback, you know, tangible outcomes in short timeframes. There's not as much admin that goes with it as opposed to a larger organization. But then being small can also cut you out of larger opportunities. So it's that double edged sword of how to balancing a balancing act between the two. And of course, cash flow is always a challenge for a small business. And as you get larger, for example, you can invest more in new services and products. And people so it's yeah, it's a double-edged sword, I guess.

Lachy Gray 

Shows it is very challenging. And in such a balance, isn't it to walk I mean, how have you sort of known that the business was growing too? Fast? So.

Darrell King 

So I think there's, yeah, there's a couple of times over the years when I could feel the pain of growth. I, for example, back in the early days, we were only consulting focused. We had about six projects running in parallel and lots of contractors to deliver the projects, which was very busy but the value of that growth was fantastic, because it built our reputation, and we were and we delivered all our projects on time and on budget. The challenge for the business was because you had that growth trajectory and you're trying to win hearts and minds is that it wasn't necessarily that profitable, because contractors were expensive to deliver those projects. So we had that balancing act. And I guess that's, that's when you know, after a year or two of that, that's when it led to the pivot, where we leveraged those initial engagements to build processes and systems to slow down the opportunities and then when ready turned back on the sales engine again, huh.

Karen Kirton 

It's always a difficult point to get to when you get consulting businesses. You're winning the work and you need the people to actually do the work and so it's always that you know, Where's where's the right level? Yeah, exactly. supply, supply and demand. So, pretty much every business advisor out there will say that business owners need to have a plan because it helps to keep the business focus. It helps to manage growth, but I know I come across a lot of businesses that have no plans or they have really basic information. And they're just, you know, building the plane as they're flying it. So what are your thoughts on business planning? Do you think it's helpful to keep growth sustainable?

Darrell King 

Definitely, the first thing I did was write a plan. Now, I'm not sure you would actually call it a plan for it was like it had all my thoughts on the page. And it was it gave me the ability to kind of understand where I was and where I wanted to go to. Like, it's funny, I've kept all of those plans and I'm kind of doing inverted commas if that's what you call in in a folder as kind of like historical archives. And it's quite interesting to look back on them over the years as they've evolved. Because plans are always going to evolve and they're always going to take a new form, but it's it's great to look back at them and and see how far I've come from that. Initial, you know, blank sheet of paper, and whatever achieved plus 10 times 100 times more than what was on that original page. So it's great to see that even today, you know, I still have a love hate relationship with planning. You know, we're 10 or 10 years in now. We've learned we've learned a lot along the way our business is a lot more mature. We have long term customers, you know, and we're a managed service organization. You know, our planning now has become a bigger operation with lots more people involved and inputs to to that planning. Planning process, I guess. So.

Lachy Gray 

Could you share a little bit about how you're as you're thinking changed, like as the business has grown? Do you still find the same planning approach? Like do you do one like a one page strategy? For example, or what does that look like?

Darrell King 

No, it's got a lot. It's got a lot bigger. I think it's had to get a lot bigger. And, you know, the, the plans require a lot more inputs into them. You know, there's a lot more financial thought that goes into it and modeling to grow us as a lot more people plan. Discussions. So for example, because we're two businesses in one right you have the people plan for the consulting business and then you have a people plan for the managed organization and then you have the support staff around us. So it's, it's just it's bigger and more complicated. But you know, you rise the goal is to write all of that and then to distill it down into something that the whole organization can understand. So for example, we've we've embraced what's called OKRs objectives and key results from a guy called John Doerr. And originally came out of Intel and Andy Grove originally. And we started now to use use those and anker so we have the business ones, and then they kind of all interlink to the teams below them, and right down to the to each staff member.

Lachy Gray 

So that's interesting. We did a an episode recently we talked about, yeah, how to measure goals and OKRs was, was one of the frameworks. How do you how do you track them? Do you use a platform for that or do you just do it manually?

Darrell King 

Look, we're a small business and platforms and SAS systems. There's you know, we've got to for every staff member currently, so they kind of take they birthday, bro like they grow like mushrooms and they, you know, your role was trying to find the one, the one to rule them all. And there never is and there's bits and pieces or there's an upgrade for so. And it's interesting. We use asana and Asana is our project management and collaboration system and then in the consulting team, and then we have employee material, which is our HR system. And of course both of them have goals done. Slightly different in each one. But if the asana wanted to engage with the goals, then you have to upgrade to some license. So it's like, do we do we need that level now? So our current strategy is to just use spreadsheets, good old trusty spreadsheets, and we'll you know, and we'll run it in the spreadsheets and when it when it starts providing value and we see the engagement of it and then we'll look at the tool. Because we've we've been on that track so many times where you go, let's try out this tool and let's see if it'll do this for us. But then you just add another tool when you know we could just run it in a spreadsheet for now and when the time comes engaged with another two

Karen Kirton 

spreadsheets.

Darrell King They make don't they make the world around?

Karen Kirton 

here actually has quite a grid goals process within it that it does using maybe instead of the spreadsheets.

Darrell King 

Yes. Maybe Maybe you can maybe you can spend maybe you can spend an hour showing me how to use it and I'd love to.

Karen Kirton 

Everything's connected together, right? But anyway, this is not an episode about HRIS.

Lachy Gray 

But it certainly resonates for me and I think it is a that's been a downside to growth for us is as you grow you think ah, we'll, let's get a tool to help us with this. You know, and all of a sudden, yeah, as you say we're probably similar in the number of platforms that we have, it was all paper cuts and some of them are big paper cups every month. And that they have to be managed and utilized and I've I've fallen into that trap myself. So that doesn't resonate with me.

Darrell King 

And security and compliance right so we we as a service provider and like we provide services to government agencies, so we need to be secure and compliant. And we have like sub two compliance, which means that all of these systems have to fall under a compliance rigor. So we need to ensure that there is no leakage of information from all these tools. And systems so and stia the no one unknown entity of the spreadsheet. Yeah,

Lachy Gray 

good boy. So what approaches have you put in place to try to make growth sustainable?

Darrell King 

Well, so far, you know, so Lachy. I think we know each other for a couple of years. So 2018 You know, and I think when I started the business, one of the one of the values that I set was that, you know, I wanted to build an autonomous sustainable business model. Meaning that, you know, I didn't, I didn't make myself just a job. That was That was never the goal. So I think with thinking with that mindset has enabled me to ensure that the business will be autonomous when I step away from it, so we're very process driven or to make that happen. You need to be very process driven, oriented business with processes and procedures, though, for example, we have an internet intranet, which is our article of truth and all of the business processes and systems are all listed and documented. And it's it is an interesting thing, when so when people come to me and ask me a question, I say, have you looked on the internet first, and if they if they have and it's not there, it's something that then gets added. But there's it's interesting a lot of people come now and there's normally I just send the link back and say, well, here you go. So that that enables that autonomy of the business. I think over time.

Karen Kirton 

You must be quite good at having like that process happening though. Because if every time someone says Hey, where's this thing or it's not interesting to put it on the internet? Somebody then needs to spend the time to create that but they never fall down that process or do you have a process for that as well?

Darrell King 

Well, you know, I think documented it there's there's overcooking documents and processes and procedures and then there is the breadcrumbs of information that enables people to follow so, you know, we're all of our staff are very tech focused and you know, they have the ability to be autonomous in themselves. So they continue to add to it as well and improve and evolve it right. It's a living it's a living documentation. repo, it's not a static repo. Because, yeah, that everything evolves over time.

Karen Kirton 

Now, with my business with amplify HR in a way help businesses are looking to scale and grow by putting in place all of their HR processes and their documents. And one thing that we find is that when businesses grow quite fast, one of the first casualties is culture. And you know, often the business owners don't realize until it's too late and they have high staff turnover, they can't get projects off the ground. You start to get the horrible term of HR issues. So you know, is this something that you've seen or experienced and where does workplace culture rank for you in terms of your business priorities?

Darrell King 

The high priority, right, the you know, number, our mentors, people focus growth, so people is number one. That's not to say that we've always been amazing at it. One of the one of the first things we do is change the mindset and call it people in culture as opposed to HR Human Resources seems so what would you call it? I don't know. Not. Not nice, whereas people in cultures there is probably another opposite in that right. But um, you know, I realized early that core to our businesses, our people and you know, our services business are the same. They were their people focused right and you have to, you have to be, you have to be understanding of that and all people are different. And it's even getting more interesting now with people working remotely. You know, the flexible work schedule thing is more organization, we cannot dictate and say everybody has to be in the office, we say, you know, it's we're flexible. what way do you want to work as long as there is an outcome focused and everyone's happy? So, but to, I guess, to answer your question, we implemented employment here in the very early days. And, of course, our intranet has been evolving to ensure successful lifecycle and work experiences here at pillar seven. So what I figured out probably about a year or two years ago, I read an article and realized that all these what, what the core hates processes are for running a business. And I basically documented all of those as a list and then created links to each in each of those to address each of them along the way. So things like HR planning, recruitment, selection, hiring, onboarding, training, performance review framework, benefits, administration, performance, managing and off boarding as well. So there are core HR processes that are all addressed and documented in our intranet.

Karen Kirton 

It sounds like maybe like you're talking before about the processes is so important to have a business that's going to grow and to grow in a way that doesn't require you. Yes, natural extension, isn't it to have all those people processes documented to

Darrell King 

definitely, yeah. So, you know, as, as I evolve, some of the team members and they take bigger roles and they become more management, you know, helping them understand these processes is Yeah, is is key.

Karen Kirton 

Really, yeah. Consistency is really important. Yeah,

Darrell King 

I can say we get a right all the time, but you know, it's 8020 rule like this, and then we can, we can always evolve and improve everything, right? Absolutely.

Lachy Gray 

What's your experience of trying to maintain your culture as you've grown over time, because culture can become a casualty, I guess, of, of or certainly fast growth, but also of remote work where yeah, you're not in the same office. You can't get a sense of the culture from a physical space. You have to do it all virtually What's it what's your experience been?

Darrell King 

Yeah, it has been. It's an it is an interesting transition. And you know, COVID was a large experiment at the, at the end of the day, you know, we as a as a born in the cloud technology company, you know, we've we've always been working remotely, you know, we're location agnostic. So that was all was part of the business from from its inception. As as it increased, so we put in tools you know, you have daily check ins, so we use Slack as another SAS collaboration tool. But we have daily check ins, daily updates, everybody logs in in the morning and does a daily update of what they're, you know, do they have any blockers, what they would the top three things they hope to achieve? And on that day, then we do daily stand ups, which used to be in the afternoon, but we've kind of now reduced that to three times three times a week. And then you have one on ones. So you know, which are going to be virtual and in person. Like we still have an office we pay for an office in the city, we call it a collaboration space, but it's you know, and it's interesting to see how many people use use the space when you know, most people I'd say are doing three days a week in the office, because people are social. You know what what realize I think after COVID Is that a lot of people are social. They want to hang out with other people they want to do the the watercooler chit chat they want to, you know, engage with others and and it's and it's good because if you what we think is you know, if you have that flexibility, then people will do what they need to get the information they require. So, you know, it's it's providing that trust and letting and trusting people to you know, that they they know what they know what they need to know what they want to sell.

Lachy Gray 

That's really interesting. So that's by choice. They're coming into the office three days a week if you keep it totally flexible.

Darrell King Yeah totally flexible

Karen Kirton 

Interesting, how many employees do you have Darrell?

Darrell King 

So we're currently 10. Some with a couple overseas. So, you know, this is the thing we have somebody in Japan, we got somebody in India and then the rest are predominantly Sydney, Sydney-based. Well, yeah, different places within Sydney.

Karen Kirton 

yeah, yeah, no, I understand because I was having a chat with Lachy last week. I'm I've decided I'm at the end of working from see going out later today to look at an office space with one of my colleagues because yeah, I decided I needed it and I asked her and she was like, Yes, I need it three days a week, right?

Darrell King 

exactly but you don't you don't want to give up you still want the flexibility, right, which I think everybody does, right? So always, you know, say you and trying to overlap with people. So I kind of like we work out and we use different tools like our Gmail calendar. Now. Calendar has added this location tab on it so you can look and you can see is a guy working remotely or in the office or somewhere else. So yeah, it's a whole new hybrid working model. And yeah, let's embrace it.

Lachy Gray 

Absolutely. And I want to ask you about your mascot, which is a polar bear. And I've never asked you about it before. So what is the story?

Darrell King 

That was there when I started the business, you know, domain names and you go right, okay, and I love I love polar bears. And you know, sustainability has always been very important to me, and to know, I was, I guess, to the business. But the reason we've adopted a polar bear as our mascot is that, you know, they are the poster child for the impacts of climate change, and they serve as that constant reminder of of it so that's that's where the polar bear comes from.

Karen Kirton 

And Lachy I don't think you should be having a go at people about their business names by the way. Oh, tell me more. Well, Yarno was not exactly a name that you hear very often on either the story behind that so maybe it maybe that's also another part.

Darrell King 

Give us give us the short version.

Lachy Gray 

Well, we added we added an O on to the end of yarn. Still a story. You know. So I'm interested in how you think about sustainability. Maybe we talked before about the sustainability of growth, but what about sustainability in terms of the environment and your community? How are you approaching that?

Darrell King 

Yeah, so it's it's, well, we've offset our own energy consumption. And so we've invested in a solar farm. That's the Australian Government certified clean green energy. And we've set a goal of B Corp certification for 2022.

Lachy Gray 

So that's fantastic.

Lachy Gray 

So Darryl, what have you learned about growth that you'd share with our audience?

Darrell King 

What I would think about is, you know, growth. It's a it's a very interesting challenge. And I'm very, I'm a very optimistic person. And some of my favorite quotes are, life's too short to be taken seriously. And don't forget to smell the roses. It's all about the journey sometimes. So when you're thinking about growth, it is hard. It has challenges. It'll throw you curveballs, but just yeah, just remember to enjoy it. And, you know, I wouldn't have it any other way.

Karen Kirton 

I think that's good advice. Sometimes I feel like running a business is like when you have a newborn baby and people say Oh, enjoy it, enjoy it and like but I'm not sleeping. It's a good reminder that yeah, we should be enjoying it as well. It's been a great conversation. So Darrell, thank you so much. I have quite a few takeaways. And I just thought I'd share three which the first one is to have some kind of plan so I like that you said you started off with just that one page that you're still saving them which is amazing. Be so interesting to look back over the years as well, I think to have a look at that. But I feel like sometimes people get stuck in this idea that I need to have a 40 page clear and they get stuck in that overwhelm.

Darrell King 

But I've been I've been there for weeks and

Karen Kirton 

maybe months even so. Yeah, so just having like you said this, the thoughts and ideas down can be helpful to give that roadmap. I liked what you said about you know, considering that it's a business. It's not just a job for the owner. So it's a business that needs to work without you at some point. I think that's a great mindset to have. Which of course leads to your processes are so important, you know, governance compliance people, etc. So thank you for that. How about for you Lachy?

Lachy Gray 

Yeah, I agree. I'm the planning of this is something I find challenging. I like detail. And I'm quite happy creating documents. But yeah, if I don't look at it again, in a couple of weeks, that's a great measure for me. So I like the idea of yeah, really flexible plans that again, grow with the business which, which can be challenging. To know how much detail to put in there.

Karen Kirton 

Absolutely. So links to anything we've discussed will be over on our website, just go to yarno.com.au which is yarn with an O on the end, as we've now discussed

Lachy Gray 

very good. story tells the story Lachy

Karen Kirton 

to amplify hr.com.edu and follow the links to the podcast. So if you're receiving value from this episode, we'd love it if you leave a rating or review over at Apple podcasts. You can get in touch with Darrell at Darrelll which is da W E double L dot King at polarseven.com. Or you can also find him on LinkedIn. So it's a linkedin.com/in/darrell king all one word.

Lachy Gray 

Coming up in the next episode, we're gonna talk about lost connections which is the importance of in-person connection. In an increasingly remote work environment.

Karen Kirton 

And I'm looking forward to that, especially as we were just touching on that in this episode, which was not planned at all. It'd be good to have that chat. So that episodes coming up in two weeks from now, click the subscribe button and you'll be notified of when that's available. Any final thoughts Lachy?

Lachy Gray 

Well, I like somebody that Darrell said before that they optimistic. The time I've known him very optimistic and positive. And I think that's super important. Because change is a constant growth is hard. There will be ups and downs. But we just keep focusing on the present and we'll find a way through so thanks for sharing today though.

Darrell King 

No, and it was great. Thanks for having me. It was lovely to chat about these things because we do we we keep running so fast and sometimes we forget to reflect back and forget about start. Sorry, remember the early days and what it was like so yeah, thanks very much, I enjoyed it.

Karen Kirton 

And thanks for joining us and we'll see you next time on the Make it Work podcast.