Building Capacity

Increasing our ability to produce outputs. It’s a chicken and egg problem. We need more capacity to land big clients. We need more clients to access funding for expansion.

Many small businesses get stuck at this hurdle for so long they end up servicing only their current clients and giving up on their dreams.

Fortunately, we can build capacity in more than one way. The first option we know all to well. Invest in infrastructure and off-take. Buy/rent production assets or expertise and hope the sales team bring in the big business. The risks are high, and the consequences of failure are dire.

The second option is to increase capacity through strategic partnerships. Futures contracts if you will. Secure the capacity you need from someone who is not fully utilised, or whose capacity increases through synergy value with you.

This is a hard fix. We need trust. We need symbiotic thinking. We need to be willing to share. We need to deal with conflict.

If we do, we get to offer our clients better solutions than anyone else. We benefit from flexibility and responsiveness to changes in our customer needs and economic reality. We innovate at greater speed with broad, holistic solutions.

The primary question is this. Are we building capacity to increase profit or impact?

Big change requires capacity. Impact is a precursor to profit.

It doesn’t work the other way.

Alex Korolkoff

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