Priorities for scaling a business
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“There is nothing so useless as doing efficiently that which should not be done at all“, said management guru Peter Drucker. Drucker made a clear distinction between effectiveness and efficiency. Effectiveness is about doing the right things, while efficiency is about doing things right.
When scaling a business, this should be our order of priorities:
- Effectiveness – are we doing the right things?
- Efficiency – are we doing things right?
- Scaling – can we do more of the right things right?
If the world doesn’t need the products or services we provide it doesn’t matter if we’re good at producing them. If we’re producing things that are important, but producing them inefficiently, we shouldn’t scale production until we’re at least somewhat efficient.