Implementing scalability can be the path that was lacking for the growth of your startup, since they are the companies in which this business model is most viable to be applied. This is because startups are created to expand the business and increase the number of customers, aiming at invoicing without having to spend so much on hiring large teams.
Scalability is that. As companies usually use technology to offer agile and quality services, without the need for a large structure to work, scalability is the possibility of the company to grow in number of customers and revenues, without having to increase their monthly costs. This occurs when you can offer services that interest the consumer, but do not require a large team or a lot of equipment.
However, for this to really work, some structural changes need to happen on the search for a high invoicing. Thinking on helping you, we have produced an article that presents some fundamental points for the good implementation of scalability. Check it out.
Types of Scalability
When we talk about scalability we can think of some specific types of this business model. In the economic sense, scalability implies that the business model of a startup has a significant increase in sales and revenue without having to spend much on developing your internal team. Currently there are some good models of success that have gone through this period of economic scalability.
A great success case is Amazon. The North American company is able to offer a wide variety of products to customers without having to acquire them. This way, the main need found by the company is to establish good partnerships, demand quality in the products and good delivery time. In other words, Amazon does not need to have large product inventories or large teams to manage these inventories and many employee expenses. If the company finds more customers for the products sold on its website it will not have an increase in its costs.
Just as economic scalability is common, computational scalability is also present and can confuse some. This kind of idea is more focused on computational and technology systems. All computers, applications, programs and algorithms may have the ability to scale to support increased users or workloads, but only if they are designed for it.
Databases need to be able to increase work if they receive more hardware resources, such as servers and processors. Algorithms can benefit from architectural innovations to help manage configurations of multiple servers, while cloud computing has broad applications to enable scalability of many parts of the IT infrastructure. But if these possibilities are not part of the original system design, it will not be considered scalable and would require rework to allow for this scalability.
Horizontal and vertical
Within the economic scalability, there are companies that prefer to focus their efforts on a horizontal model and others on a vertical one. To exemplify better, in horizontal scalability, the objective is the dominance of the segment as it happens with Submarino, Amazon and Lojas Americanas. In this case, these companies can sell a large amount of products from different sectors and categories, covering most of the active consumers on the Internet. On the other hand, the vertical scalability is more specific. Different from the previous one, they are companies specialized on sales of products of only one category, such as the ones that are on sale of electronic devices.
What does it take to have scalability?
One of the most important ways to scale in a startup is the adoption of cloud solutions. This is because implementing this type of service in your business allows professionals to work from wherever they are without having to be all in one place.
This way, in the middle of important trips and business commitments, access to important documents and capital for the development of your startup can be done through internet access, either by smartphone or notebook. Another advantage is that there is savings in renting a physical space, since most projects can be developed remotely over the Internet. This model is already quite common, since the number of companies that adopt the home-office regime has grown a lot.
In addition, investing in modern software for project management and communication are essential for the productivity of technology teams to be high and for the development of the project to be efficient, in the search for customer approval.
Adapt your startup
Before any radical change in the style of your business it is important that every leader plans what goals need to be achieved in order for your business to be scalable. Whether every semester or every year, define priorities and strategies that will be taken in the search for good results.
A common example of a scalable business model is e-commerce, which can increase your revenue without necessarily increasing your monthly expenses. On the other hand, a clothing store has no way to scale, as it needs to invest in a great amount of products in order the sales increase during the whole year.
Be organized in your processes
Having an organization in relation to the development of your projects is not only important for those who want to scale your company, but for any company. A business that aims at success in a shorter period of time needs to have its processes very well defined, to the point that other professionals can share knowledge among themselves. This way, the startup is not tied to only one professional and can have several performing the same function in which there is need, increasing the effectiveness of projects and reducing delivery time.
Outsource and use metrics
To increase your startup scalability even more, outsourcing some processes may be the solution so you don’t need to invest in internal teams. Especially when it comes to IT professionals, hiring a company specialized in outsourcing software development can save you a good part of your revenue, since the professionals will be experts in the subject, they will work for you and you don’t need to worry about training or how the project will be done.
In addition, it is important that you, as a company leader, make use of intelligent metrics of all the processes that are being done, whether in development, HR or Marketing. This way, it is possible to analyze possible problems and where there is a need for improvement. Currently, metrics such as KPIs and OKRs are the most used by startup leaders.