Various sources can help to scale your business. Technology is one crucial element. The other is the people behind your product or solution. You will need more people when your business grows, but they don't have to be full-time employees. You can hire different types of help, such as outsourced companies, subcontractors/freelancers, and full-time employees.

Types of hired help

Benefits <ul><li dir = "auto">You have a lot of say over what tasks a full-time employee accomplish daily.</li><li dir = "auto">They build specialised knowledge about your product or services.</li><li dir = "auto">They develop strong relationships with clients if they're in client-facing roles.</li><li dir = "auto">They become a crucial part of your company's culture.</li></ul> Drawbacks <ul><li>Full-time employees come with mandatory costs and other expenses.</li><li>If you want them to stay committed, you have to keep them happy by offering competitive salaries, benefits, training, tools and company perks.</li></ul>

Full-time employees

Benefits <ul><li dir = "auto">You hire a subcontractor for a specific project, so expenses are limited to the contract.</li><li dir = "auto">You don't have to pay salaries, benefits, or offer company perks.</li><li dir = "auto">You have a medium-level say over their work tasks.</li><li dir = "auto">You're hiring a professional who knows their craft and don't have to provide too much oversight.</li></ul> Disadvantages <ul><li>They might not be the best fit for your company or project.</li><li>They might leave for another hire at a higher rate if they don't want to work with you long-term.</li><li>They work with multiple clients and can't devote their full focus to your project.</li></ul>

Subcontractors/Freelancers

Advantages <ul><li dir = "auto">You have low maintenance. The company's team has a history of doing a specific type of work and requires the least overseeing.</li><li dir = "auto">You don't have to work with the outsourced company again if you're dissatisfied with the outcome.</li></ul> Disadvantages <ul><li>You have low control. You can't tell a company you've outsourced how to do the steps your way.</li><li>You might encounter problems with differing work styles and expectations.</li></ul>

Outsourced companies

Ensure that you comply with all applicable labour laws to prevent severe consequences. For example, the US IRS can penalise employers who misclassify employees. If you work with the applicable employment laws and treat your workers with care and respect, a strategic approach to hiring workers will benefit your company.

Remember to follow all laws

Stashed ideas

Scaling Your Business? The Pros And Cons Of Hiring Different Types Of Workers

Unit of value:<ul><li>What your customers pay for.</li><li>The smallest measurable unit at which your product or service delivers value.</li><li>Examples: servers, user seats, TBs of storage, API calls.</li></ul>Your unit of value determines how you price, scale and sell your product to customers.

Unit of value

Single units of value<ul><li>Dropbox / Office 365 - one user</li><li>VMWare - one server</li></ul>Medium/Team units of value<ul><li>GitHub - dev team</li><li>Salesforce - 3-4 sales reps</li></ul>Big units of value<ul><li>SAP - ERP for entire company</li><li>Oracle - Enterprise apps for entire company</li></ul>

Unit of value examples

From the 80/20 rule you know a few customers will drive your sales. Your goal is to find that handful of customers and scale them up. The goal is to create non-linear value for them.Build out your offerings so the more your customers consume, the more value they get. Sell additional products at scale, like management, monitoring, or security.One way to increase value is through network effects: more users = more value. Examples: collaboration tools (GitHub) and communication platforms (Slack).

Create non-linear value

<ol><li>Define your unit of value: What is the smallest unit of your product that delivers value to your customers?</li><li>Create a roadmap to increase that value as you scale. Identify ways to increase value as you and your customers grow. Figure out how to combine your services to create non-linear value over time.</li></ol>

Apply this to your startup

Jerry Chen, partner at Greylock and former VP of Cloud and Application Services at VMware, shares his Unit of Value framework for startups building a go-to-mar…

Workgroup

Unit of Value: A Framework for Scaling

In the world of finance, scalability refers to the ability of a company to sustain or better its performance in terms of profitability or efficiency when its sales volume increases.It is usually a big challenge for any company to maintain its profitability or efficiency when the volume of sales increases. Similarly, capital markets must have the ability to maintain their performance levels when the volumes of trade carried out by traders and investors rise.

Definition of 'Scalability'

Money & Investments

Scalability  definition - What is meant by the term Scalability ? meaning of IPO, Definition of Scalability  on The Economic Times.

Money

What is Scalability? Definition of Scalability, Scalability Meaning - The Economic Times

A business model refers to a company&#39;s plan for making a profit.
<ul>
<li>It identifies the product or service</li>
<li>The target market</li>
<li>Anticipated expenses</li>
</ul>
A business model helps developing companies to attract investment, recruit talent, and motivate management and staff. Established businesses should regularly update their business plans to help anticipate trends and challenges ahead.

The Business Model

<ul>
<li>The primary component of the business model is the value proposition. A value proposition is a description of the goods or services a company offers and why they are desirable to customers or clients.</li>
<li>A new enterprise&#39;s business model also covers projected startup costs, financing sources, the target customer base, marketing strategy, a review of the competition, and projections of income and expenses.</li>
<li>When evaluating a company as a possible investment, the investor should find out exactly how it makes money by looking through the company&#39;s business model.</li>
</ul>

Understanding Business Models

A common mistake companies make in their business model is that they often underestimate the costs of funding the business until it becomes profitable.
Many analysts believe that companies that run on the best business models can run themselves.
<ul>
<li>One way analysts and investors evaluate the success of a business model is by looking at the company&#39;s gross profit - the total revenue minus the cost of goods sold. </li>
<li>Analysts also want to see cash flow or net income - the gross profit minus operating expenses.</li>
</ul>

Special Considerations

There are many types of business models for every kind of business.
<ul>
<li>Traditional business models include direct sales, franchising, advertising-based, and brick-and-mortar stores.</li>
<li>Hybrid models include businesses that combine internet retail with brick-and-mortar stores or sporting organizations.</li>
</ul>

Types of Business Models

There are two critical factors in judging business models. When business models don&#39;t work, it is because
<ol>
<li>the story doesn&#39;t make sense anymore, for example, the airline industry;</li>
<li>the numbers don&#39;t add up to profits, that is companies that suffered heavy losses or bankruptcy.</li>
</ol>

Criticism of Business Models

Business Model Definition

The shift from product-market-fit to growth disrupts far too many promising startups.
Companies at every stage can learn how to create effective, replicable, and durable product development systems using a few tactics.

Creating scalable systems

Leadership

There is such a thing as startup puberty and it occurs when your product starts to gather momentum. A startup may be so busy working on getting to this stage that they are caught off guard and may not be ready for the change. The most important changes for a product:
<ul>
<li>You are no longer your customer. Once you hit product market-fit, you need more data as you can no longer reasonably represent all your customers.</li>
<li>You have the ability to test much more. At this point, you can start optimizing because you&#39;re pulling enough users or customers to correlate product tweaks with behavior.</li>
</ul>

Crossing the chasm

New needs mean you need more people. To set people up for success, you need to make your product and engineering teams modular. Then you can split up problems that people can work with independently.
As you grow, your leverage will be in having many autonomously led teams, working side by side. This will enable you to scale easily later.

Modular teams

The idea is that product management can no longer say what they think users want. They need to predict what outcome a feature will have.
In the beginning, you don&#39;t have the data you need to do this. Your company, in itself, is your hypothesis. As you start to grow, your ability to make educated guesses becomes the core and fuel for making your product better.

Hypothesis-Driven Product Management

As a company matures, three major areas of product development change:
<ul>
<li>How you generate ideas</li>
<li>How you execute those ideas</li>
<li>How you continually build on those ideas.</li>
</ul>

Areas of change

Don&#39;t think you can continue to relate to your customer. Instead, make a list of the outcomes you want, then make a guess what will get you there based on data and research.
<ul>
<li><ul>
<li>If you don&#39;t have the volume of data, start with qualitative feedback from user surveys or testing.*</li>
</ul>
</li>
<li>Use competitive analysis. Have your competitors achieved a similar outcome to the one you like? How can you build on their ideas?</li>
<li>Interview people who you want to have as your target audience. What do they use that&#39;s similar? Why might they not choose a product like yours?</li>
</ul>
Once you have some working hypotheses, you can start quantitatively measuring results to drive future brainstorming.

Generating ideas

It is helpful when you brainstorm to separate idea generation from idea evaluation. Write down every idea. Then trim your list by applying the feedback you&#39;ve received through user tests, surveys, and other inputs. Prioritize this filtered list:
<ul>
<li>How important is the outcome this idea will serve?</li>
<li>What is the likelihood of success?</li>
</ul>

Prioritize the distilled list

After you brainstorm, you may have many initiatives. After you hit product-market fit, you need to allocate responsibility across teams and empower them to work without the leadership knowing everything. Thematic org areas include:
<ul>
<li>Core product: How to make typical use of the product better.</li>
<li>Signup experience: How to bring more people into the product.</li>
<li>Internal tools: How to optimize the way you&#39;re working with infrastructure.</li>
<li>Content: What content do you present to users? How?</li>
<li>Community: How to set up communities for success.</li>
<li>Channels: Where and how to engage with users outside the core product.</li>
<li>Monetization: How to sustain what you&#39;re doing.</li>
</ul>

Modular execution

The CEO should cede a large amount of control. The CEO should shift from caring about the design of the product to focusing of the design of the organization.
<ul>
<li>Once a founder or CEO gives up the need to know everything, its easier to reorganize along thematic lines.</li>
<li>Each team needs to be able to drive themselves forward with their own point people.</li>
<li>Focus on handing out prioritites, not tasks. Then let your people be creative about their own execution.</li>
<li>A holistic focus is recommended over a pure tech focus.</li>
</ul>

Give up control

The transition needs to happen when:
<ul>
<li>The CEO or co-founders can&#39;t contain everything in their heads and don&#39;t know what&#39;s happening in various parts of the product.</li>
<li>You&#39;re trying to expand the product, which requires more work to understand users.</li>
<li>Existing staff members are responsible for too many different areas.</li>
</ul>

When the transition is necessary

<ul>
<li>Appoint a business owner for each thematic area who is responsible for driving KPIs, managing stakeholders, and communicating changes.</li>
<li>Minimize existing cross-team dependencies.</li>
<li>Set quarterly operational targets. Tie individuals&#39; OKRs to objectives.</li>
<li>Have the founders or executives direct the smaller thematic teams by setting minimal but big company-wide objectives, and allocating resources.</li>
<li>Continually reevaluate where there are bottlenecks in the system and address them.</li>
</ul>

Initiating the transition

As your company matures, ensure to appoint someone to care about the holistic experience.
<ul>
<li>This person should be focused on collecting and communicating data coming out of experiments, and</li>
<li>Guiding everyone to build features and run tests that connect to company goals.</li>
</ul>
If you don&#39;t have proper communication on your product team, many individuals may pursue their own goals for their own feature, causing a sprawl of your product.

The impact of product ops

With the growth of your organization, consistently message the same things again and again. Templates ingrain this practice.
For instance, at Reddit, whenever you&#39;re about to run a test, you already have the format of an email to explain what you&#39;re testing. The template consists of fields where you&#39;ll insert the results.

Using templates

<ul>
<li>Pick only a few hard-and-fast rules.</li>
<li>Provide autonomy between firm commitments.</li>
<li>Be clear about the role of product ops.</li>
<li>Just start. Rather start something in ops than to have a master plan and the process figured out. Start light.</li>
</ul>

scaling

Types of hired help

Scaling Your Business? The Pros And Cons Of Hiring Different Types Of Workers

Unit of value

Unit of Value: A Framework for Scaling