14th September 2022
Hypergrowth businesses have turned traditional business practices on their head. The challenge facing boardrooms over recent years is one of holding their nerve and convincing the team and investors to ‘double-down’ on customer acquisition at the expense of profitability. This is even more acute in SaaS and subscription-style businesses where Generally Accepted Accounting Principles (GAAP) simply do not apply, and the business models are exceptionally sensitive to a few key levers.
This has led to an accepted notion that hypergrowth businesses are either growing fast or profitable. And if you’re profitable you just might not be all that ambitious, suggesting that growth and profitability are mutually exclusive.
Given this, how do these companies in the current macro-economic environment respond to a call from investors to become more efficient and carve a path to profitability?
The initial component to look at is a shift in the metrics used to manage the business. For example, revenue is likely to play a more important role than the number of customers acquired. And at the same time the costs of doing business are more likely to be interrogated.
This is where the customer support function can play a leading role in two clear ways:
1) Most hypergrowth businesses have prioritised growing market share through customer acquisition over creating finely tuned operations. This presents an excellent opportunity for those able and willing to differentiate beyond an innovative value chain and create effortless customer experiences. Opportunities abound in utilising technology, automation, streamlining methodology, and scaling repeatable processes.
2) Those businesses which fine tune their customer support functions also stand to benefit from the potential to leverage customer support as a driver of growth. Increasing the Lifetime Value (LTV) of a customer by driving up spend through upselling or cross-selling or improved customer satisfaction leading to increased retention.
The challenge lies in the ability for the business to be agile, embrace change and have conviction in what good looks like.
Resourcing for top line growth and bottom-line protection
The complexity of resourcing grows as businesses continue to scale, creating two challenges when seeking profitability.
1) The methods and approaches which worked adequately when starting up and finding product market fit don’t scale and are no longer fit for purpose.
2) Resourcing for profitability necessitates a paradigm shift from top-line growth at all costs to a balancing act between growth and bottom-line protection.
The good news is that workforce management is a time proven approach to increasing efficiency whilst also ensuring a company has the right people, with the right skills available at the right time to support their customers. A win for the employee, the business, and their customers.
Forging a new path can be daunting, but you don’t have to go it alone. Now may be the opportune time to call in the experts and accelerate your agenda in ways such as:
Outsourcing: All or part of your customer support operation presents significant efficiency opportunities – see our Whitepaper Outsourcing to support your hyper-growth trajectory.
Technology: Partnerships can help to overcome technology deficiencies in your support centre built up over time as profitability was prioritised. A CX Technology review can identify the opportunities and the right path to take.
Specialist customer experience consultants: CX experts canhelp you navigate the landscape and prioritise on the vital few things which will move the dial.
The customer support bonus: Realising benefits beyond profits
Focusing on customer support as you pivot to profitability provides additional benefits:
1) Delivery to your customers is enhanced and improved, increasing customer satisfaction
2) Employee morale is boosted; removing the operational pain points they feel on a day-to-day basis. Increasing retention and reducing the burden on recruitment
3) Development of an operational efficiency mindset and performance culture to support the next phases of your growth
The transition from a growth (potentially growth at all costs) mindset to a profitable one, is not going to be easy – particularly for larger scale-ups. However, the prize is worth it. Focusing on customer support means you can deliver bottom-line efficiencies whilst also improving the top line. Partnerships in outsourcing, technology and consulting can help to accelerate and deliver benefits beyond profitability.
We are passionate about delivering exceptional CX and have the skills and know-how to do so in a financially responsible way. If you would like to find out how we can support your journey from growth to profitability, please get in touch.
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